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<a name="s352A4075C81A4E4361158B32D37DC550"></a><div></div><br><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">As filed with the Securities and Exchange Commission </font><font style="font-family:inherit;font-size:10pt;font-weight:bold;">on July 3,</font><font style="font-family:inherit;font-size:10pt;font-weight:bold;">&#32;2013</font></div><div style="line-height:120%;text-align:left;text-indent:713px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;">Registration No. __________</font></div><div style="line-height:120%;text-align:right;padding-left:402px;font-size:2pt;"><font style="font-family:inherit;font-size:2pt;"><br></font></div><div style="line-height:120%;"><hr></div><div style="line-height:100%;text-align:left;font-size:1pt;"><font style="font-family:inherit;font-size:1pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:14pt;"><font style="font-family:inherit;font-size:14pt;font-weight:bold;">UNITED STATES</font></div><div style="line-height:120%;text-align:center;font-size:14pt;"><font style="font-family:inherit;font-size:14pt;font-weight:bold;">SECURITIES AND EXCHANGE COMMISSION</font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">WASHINGTON, D.C. 20549</font></div><div style="line-height:120%;padding-top:16px;text-align:center;font-size:15pt;"><font style="font-family:inherit;font-size:15pt;font-weight:bold;">FORM S-1</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-weight:bold;">REGISTRATION STATEMENT</font></div><div style="line-height:120%;text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-weight:bold;">UNDER</font></div><div style="line-height:120%;text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-weight:bold;">THE SECURITIES ACT OF 1933</font></div><div style="line-height:120%;padding-bottom:4px;text-align:center;font-size:6pt;"><font style="font-family:inherit;font-size:6pt;font-weight:bold;">__________________________________</font></div><div style="line-height:120%;text-align:center;font-size:14pt;"><font style="font-family:inherit;font-size:14pt;font-weight:bold;">FIRST SECURITY GROUP, INC.</font></div><div style="line-height:120%;text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(Exact name of registrant as specified in its charter)</font></div><div style="line-height:120%;text-align:left;text-indent:540px;font-size:4pt;"><font style="font-family:inherit;font-size:4pt;font-weight:bold;">&#160;&#160;&#160;&#160;</font></div><div style="line-height:120%;font-size:8pt;"><div style="padding-left:0px;text-indent:0px;line-height:normal;padding-top:10px;"><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman;font-size:10pt;width:100%;border-collapse:collapse;text-align:left;"><tr><td colspan="3"></td></tr><tr><td width="33%"></td><td width="35%"></td><td width="32%"></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;text-indent:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;">TENNESSEE</font></div><div style="text-align:center;text-indent:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(State or other jurisdiction of incorporation or organization)</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;">6021</font></div><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(Primary Standard Industrial Classification Number)</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;text-indent:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;">58-2461486</font></div><div style="text-align:center;text-indent:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(IRS Employer Identification Number)</font></div></td></tr></table></div></div><div style="line-height:120%;padding-left:37px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;padding-bottom:4px;text-align:center;font-size:6pt;"><font style="font-family:inherit;font-size:6pt;font-weight:bold;">__________________________________</font></div><div style="line-height:120%;text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;">531 BROAD STREET</font></div><div style="line-height:120%;text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;">CHATTANOOGA, TENNESSEE  37402</font></div><div style="line-height:120%;text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;">(423) 266-2000</font></div><div style="line-height:120%;text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(Address, including zip code, and telephone number, including</font></div><div style="line-height:120%;text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">area code, of registrant&#8217;s principal executive offices)</font></div><div style="line-height:120%;padding-bottom:4px;text-align:center;font-size:6pt;"><font style="font-family:inherit;font-size:6pt;font-weight:bold;">__________________________________</font></div><div style="line-height:120%;text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;">D. MICHAEL KRAMER</font></div><div style="line-height:120%;text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;">FIRST SECURITY GROUP, INC.</font></div><div style="line-height:120%;text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;">531 BROAD STREET</font></div><div style="line-height:120%;text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;">CHATTANOOGA, TENNESSEE  37402</font></div><div style="line-height:120%;text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;">(423) 266-2000</font><font style="font-family:inherit;font-size:8pt;">&#32;</font></div><div style="line-height:120%;text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(Name, address, including zip code, and telephone number,</font></div><div style="line-height:120%;padding-bottom:4px;text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">including area code, of agent for service)</font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Copies of Communications to:</font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><div style="padding-left:0px;text-indent:0px;line-height:normal;padding-top:10px;"><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman;font-size:10pt;margin-left:auto;margin-right:auto;width:100%;border-collapse:collapse;text-align:left;"><tr><td colspan="3"></td></tr><tr><td width="34%"></td><td width="33%"></td><td width="33%"></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;vertical-align:top;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;text-align:center;vertical-align:top;">Robert D. Klingler</font></div><div style="text-align:center;vertical-align:top;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;text-align:center;vertical-align:top;">Bryan Cave LLP</font></div><div style="text-align:center;vertical-align:top;text-indent:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;text-align:center;vertical-align:top;">One Atlantic Center</font></div><div style="text-align:center;vertical-align:top;text-indent:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;text-align:center;vertical-align:top;">Fourteenth Floor</font></div><div style="text-align:center;vertical-align:top;text-indent:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;text-align:center;vertical-align:top;">1201 West Peachtree Street, NW</font></div><div style="text-align:center;vertical-align:top;text-indent:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;text-align:center;vertical-align:top;">Atlanta, Georgia  30309-3488</font></div><div style="text-align:center;vertical-align:top;text-indent:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;text-align:center;vertical-align:top;">(404) 572-6600</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;vertical-align:top;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;vertical-align:top;">Randolph A. Moore III</font></div><div style="text-align:center;vertical-align:top;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;vertical-align:top;">Alston &amp; Bird LLP</font></div><div style="text-align:center;vertical-align:top;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;vertical-align:top;">One Atlantic Center</font></div><div style="text-align:center;vertical-align:top;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;vertical-align:top;">1201 West Peachtree Street, NW</font></div><div style="text-align:center;vertical-align:top;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;vertical-align:top;">Atlanta, Georgia 30309</font></div><div style="text-align:center;vertical-align:top;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-weight:bold;vertical-align:top;">(404) 881-7794</font></div></td></tr></table></div></div><div style="line-height:120%;padding-left:37px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;padding-bottom:4px;text-align:center;font-size:6pt;"><font style="font-family:inherit;font-size:6pt;font-weight:bold;">__________________________________</font></div><div style="line-height:120%;padding-bottom:4px;text-align:left;text-indent:48px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement.</font></div><div style="line-height:120%;padding-bottom:4px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:8pt;">If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box.  </font><font style="font-family:Wingdings;font-size:10pt;">x</font></div><div style="line-height:120%;padding-bottom:4px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:8pt;">If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. </font><font style="font-family:Wingdings;font-size:10pt;">o</font></div><div style="line-height:120%;padding-bottom:4px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:8pt;">If this Form is a post-effective amendment filed pursuant to Rule 462(c) 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. </font><font style="font-family:Wingdings;font-size:10pt;">o</font></div><div style="line-height:120%;padding-bottom:4px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:8pt;">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. </font><font style="font-family:Wingdings;font-size:10pt;">o</font></div><div style="line-height:120%;padding-bottom:4px;text-align:left;text-indent:46px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">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 &#8220;large accelerated filer,&#8221; &#8220;accelerated filer&#8221; and &#8220;smaller reporting company&#8221; in Rule 12b-2 of the Exchange Act.</font></div><div style="line-height:120%;padding-bottom:4px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:8pt;">Large accelerated filer </font><font style="font-family:Wingdings;font-size:10pt;">o</font><font style="font-family:Wingdings;font-size:10pt;">&#32;</font><font style="font-family:inherit;font-size:10pt;">&#160;&#160;&#160;&#160;</font><font style="font-family:inherit;font-size:8pt;">Accelerated filer </font><font style="font-family:Wingdings;font-size:10pt;">o</font><font style="font-family:inherit;font-size:10pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font><font style="font-family:inherit;font-size:8pt;">Non-accelerated filer </font><font style="font-family:Wingdings;font-size:10pt;">o</font><font style="font-family:inherit;font-size:10pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font><font style="font-family:inherit;font-size:8pt;">Smaller reporting company </font><font style="font-family:Wingdings;font-size:10pt;">x</font></div><div style="line-height:120%;padding-bottom:4px;text-align:center;text-indent:48px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;"><br></font></div><br><div></div><hr style="page-break-after:always"><a name="s352A4075C81A4E4361158B32D37DC550"></a><div></div><br><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-weight:bold;">CALCULATION OF REGISTRATION FEE </font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><div style="padding-left:0px;text-indent:0px;line-height:normal;padding-top:10px;"><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman;font-size:10pt;margin-left:auto;margin-right:auto;width:100%;border-collapse:collapse;text-align:left;"><tr><td colspan="8"></td></tr><tr><td width="3%"></td><td width="3%"></td><td width="33%"></td><td width="12%"></td><td width="15%"></td><td width="18%"></td><td width="15%"></td><td width="1%"></td></tr><tr><td colspan="3" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-weight:bold;">Title of Each Class of Securities to be Registered </font><font style="font-family:inherit;font-size:9pt;font-weight:bold;"><sup style="vertical-align:top;line-height:120%;font-size:6pt">(1)</sup></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-weight:bold;">Amount to be Registered</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-weight:bold;">Proposed Maximum Offering <br>Price Per Share </font><font style="font-family:inherit;font-size:9pt;font-weight:bold;"><sup style="vertical-align:top;line-height:120%;font-size:6pt">(2)</sup></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-weight:bold;">Proposed Maximum Aggregate Offering Price </font><font style="font-family:inherit;font-size:9pt;font-weight:bold;"><sup style="vertical-align:top;line-height:120%;font-size:6pt">(3)</sup></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-weight:bold;">Amount of Registration Fee </font><font style="font-family:inherit;font-size:9pt;font-weight:bold;"><sup style="vertical-align:top;line-height:120%;font-size:6pt">(4)</sup></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td colspan="3" style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Non-Transferable Common Stock Subscription Rights</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">1,664,617</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">N/A</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">N/A</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">$0</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td colspan="3" style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Common Stock, par value $0.01 per share</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:8px;padding-bottom:8px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">3,329,234</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">$1.50</font></div></td><td style="vertical-align:bottom;padding-top:2px;padding-bottom:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">$4,993,851</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">$681</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;"><sup style="vertical-align:top;line-height:120%;font-size:5pt">(1)</sup>&#160;</font></div></td><td colspan="6" style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="padding-bottom:6px;text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">This registration statement relates to: (a) non-transferable subscription rights to purchase common stock of the Registrant, which subscription rights are to be issued to holders of the Registrant&#8217;s common stock and (b) the shares of common stock deliverable upon the exercise of the non-transferable subscription rights pursuant to the rights offering.</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;"><sup style="vertical-align:top;line-height:120%;font-size:5pt">(2)</sup>&#160;</font></div></td><td colspan="6" style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Offering price per share is fixed by the Stock Purchase Agreement, dated as of February 25, 2013, by and among the Registrant and each of the investors named therein.</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;"><sup style="vertical-align:top;line-height:120%;font-size:5pt">(3)</sup>&#160;</font></div></td><td colspan="6" style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Includes the gross proceeds from the assumed exercise of all non-transferable subscription rights to be issued.</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;"><sup style="vertical-align:top;line-height:120%;font-size:5pt">(4)</sup>&#160;</font></div></td><td colspan="6" style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="padding-bottom:6px;text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">The non-transferable subscription rights are being issued without consideration.  Pursuant to Rule 457(g), no separate registration fee is payable with respect to the rights being offered hereby since the rights are being registered in the same registration statement as the securities to be offered pursuant thereto.  Pursuant to Rule 457(p) under the Securities Act, the full amount of the registration fee currently due for this Registration Statement has been offset against part of the remaining unused portion of the $1,491.43 fee paid by the Registrant in connection with the Registration Statement on Form S-3 (No. 333-157196) filed on February 9, 2009.  The securities registered by Registration Statement No. 333-157196 have been removed from registration without having been sold via Post-Effective Amendment No. 1 filed on May 15, 2013.   As a result the unused portion of the registration fee previously paid in connection with the Form S-3 is reduced to $810.43.</font></div></td></tr></table></div></div><div style="line-height:120%;text-align:left;text-indent:46px;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;"><br></font></div><div style="line-height:120%;text-align:left;text-indent:46px;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-weight:bold;">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&#160;8(a) of the Securities Act or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section&#160;8(a), may determine.</font></div><div style="line-height:120%;text-align:center;font-size:2pt;"><font style="font-family:inherit;font-size:2pt;"><br></font></div><br><div></div><hr style="page-break-after:always"><a name="s63C18EC112DDDA60638E8B32D3BB13D3"></a><div></div><br><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#ff0000;font-weight:bold;">SUBJECT TO COMPLETION DATED JULY 3, 2013</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#ff0000;font-weight:bold;">The information in this preliminary prospectus is not complete and may be changed.  This preliminary prospectus is included in a registration statement that we filed with the Securities and Exchange Commission.  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 these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. </font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;text-decoration:underline;">PRELIMINARY PROSPECTUS</font></div><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Up to 3,329,234 Shares of Common Stock</font></div><div style="line-height:120%;padding-bottom:16px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Issuable upon the exercise of Subscription Rights at $1.50 per share</font></div><div style="line-height:120%;text-align:center;"><img src="fsg2013rightsoffering_image1.jpg" style="height:105px;width:350px;"></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We are distributing, at no charge to certain shareholders, non-transferable subscription rights to purchase up to 3,329,234 shares of our common stock, $0.01 par value per share (the &#8220;rights offering&#8221;).  Subscription rights will be distributed to persons who owned shares of our common stock as of 5:00 p.m. Eastern Time, on April 10, 2013, the record date of the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:12pt;"><font style="font-family:inherit;font-size:12pt;font-weight:bold;">The exercise of your subscription rights for shares of our common stock involves risks.  Before determining whether to exercise your subscription rights and purchase our common stock, you should carefully read the section titled &#8220;</font><font style="font-family:inherit;font-size:12pt;font-style:italic;font-weight:bold;">Risk Factors</font><font style="font-family:inherit;font-size:12pt;font-weight:bold;">&#8221; beginning on page 15 of this prospectus along with our periodic reports and other information we file with the Securities and Exchange Commission.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Each subscription right will entitle a shareholder to purchase two shares of our common stock at the subscription price of $1.50 per share for each share of common stock owned by such shareholder on the record date, which we refer to as the &#8220;basic subscription privilege.&#8221;  If you fully exercise your basic subscription privilege and other shareholders do not fully exercise their basic subscription privileges, you will be entitled to exercise an &#8220;over-subscription privilege,&#8221; subject to certain limitations and subject to allotment, to purchase a portion of the unsubscribed shares of our common stock at the same subscription price of $1.50 per share.  To the extent you properly exercise your over-subscription privilege for an amount of shares that exceeds the number of the unsubscribed shares available to you, any excess subscription payments received by the subscription agent will be returned to you, without interest, as soon as practicable following the expiration of the rights offering.  Funds we receive from subscribers in the rights offering will be held in escrow by the subscription agent until the rights offering is completed or canceled.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The subscription rights will expire if they are not exercised by 5:00 p.m., East</font><font style="font-family:inherit;font-size:10pt;">ern Time, on ___________, 2013.  We reserve the right to extend the expiration date one or more times, but in no event will we extend the rights offering beyond ___________, 2013.  We reserve the right to cancel, at any time, the rights offering. If the rights offering is cancelled, all subscription payments received by the subscription agent will be promptly returned, without interest or penalty.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">You should carefully consider whether to exercise your subscription rights prior to the expiration of the rights offering.  All exercises of subscription rights are irrevocable.  Our board of directors is making no recommendation regarding your exercise of the subscription rights.  The subscription rights may not be sold, transferred or assigned and will not be traded on the NASDAQ Capital Market or on any stock exchange or market.  Our common stock is traded on the NASDAQ Capital Market under the trading symbol &#8220;FSGI.&#8221;  The last reported sales price for shares of our common stock on July 2, 2013 was $2.16 per s</font><font style="font-family:inherit;font-size:10pt;">hare. </font></div><br><div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><hr style="page-break-after:always"><a name="s63C18EC112DDDA60638E8B32D3BB13D3"></a><div></div><br><div style="line-height:120%;text-align:center;font-size:10pt;"><div style="padding-left:0px;text-indent:0px;line-height:normal;padding-top:10px;"><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman;font-size:10pt;margin-left:auto;margin-right:auto;width:76.70940170940172%;border-collapse:collapse;text-align:left;"><tr><td colspan="7"></td></tr><tr><td width="48%"></td><td width="1%"></td><td width="25%"></td><td width="1%"></td><td width="1%"></td><td width="23%"></td><td width="1%"></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="3" style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:9.5pt;"><font style="font-family:inherit;font-size:9.5pt;"><br></font></div><div style="text-align:center;font-size:9.5pt;"><font style="font-family:inherit;font-size:9.5pt;font-weight:bold;">Per Share</font></div></td><td colspan="3" style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:9.5pt;"><font style="font-family:inherit;font-size:9.5pt;font-weight:bold;">Total Offering</font></div><div style="text-align:center;font-size:9.5pt;"><font style="font-family:inherit;font-size:9.5pt;font-weight:bold;">Size</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Public offering price</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;border-top:1px solid #000000;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">$</font></div></td><td style="vertical-align:top;padding-top:2px;padding-bottom:2px;border-top:1px solid #000000;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">1.50</font></div></td><td style="vertical-align:bottom;border-top:1px solid #000000;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;border-top:1px solid #000000;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">$</font></div></td><td style="vertical-align:top;padding-top:2px;padding-bottom:2px;border-top:1px solid #000000;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">4,993,851</font></div></td><td style="vertical-align:bottom;border-top:1px solid #000000;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Maximum dealer management fee</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">$</font></div></td><td style="vertical-align:top;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">0.09</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">$</font></div></td><td style="vertical-align:top;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">299,631</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Net proceeds, before expenses, to us</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">$</font></div></td><td style="vertical-align:top;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">1.41</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">$</font></div></td><td style="vertical-align:top;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">4,694,220</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td></tr></table></div></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">This is not an underwritten offering. The dealer manager has agreed to use its reasonable efforts to advise and assist us in our efforts to solicit subscriptions of the subscription rights distributed to holders of our common stock, but the dealer manager is not underwriting the offering and has no obligation to purchase or procure purchases of our common stock offered by this prospectus.  We are offering common stock directly to holders of record on the record date.  See &#8220;Plan of Distribution.&#8221; </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">These securities are not deposits, savings accounts or other obligations of any bank and are not insured or guaranteed by the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, or any other government agency.  Neither the Securities and Exchange Commission, the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency nor any state securities regulator has approved or disapproved of these securities or determined if this prospectus is accurate or complete. Any representation to the contrary is a criminal offense.</font></div><div style="line-height:120%;text-align:center;font-size:18pt;"><font style="font-family:inherit;font-size:18pt;font-weight:bold;">RAYMOND JAMES</font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">(Dealer Manager)</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The date of this prospectus is </font><font style="font-family:inherit;font-size:10pt;">___________</font><font style="font-family:inherit;font-size:10pt;">, 2013.</font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><hr style="page-break-after:always"><a name="s63C18EC112DDDA60638E8B32D3BB13D3"></a><div></div><br><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:center;font-size:10pt;"><div style="padding-left:0px;text-indent:0px;line-height:normal;padding-top:10px;"><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman;font-size:10pt;margin-left:auto;margin-right:auto;width:100%;border-collapse:collapse;text-align:left;"><tr><td colspan="2"></td></tr><tr><td width="91%"></td><td width="9%"></td></tr><tr><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">TABLE OF CONTENTS</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">Page</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">ABOUT THIS PROSPECTUS</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">1</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">SPECIAL NOTE ABOUT FORWARD-LOOKING STATEMENTS</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">1</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">WHERE YOU CAN FIND MORE INFORMATION</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">3</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">INCORPORATION OF CERTAIN INFORMATION BY REFERENCE</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">3</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:10pt;"><a style="text-decoration:none;color:#000000;font-family:Times New Roman;font-size:10pt;" href="#s8B751E9D0A2AA27D7CCC8B32D4090224"><font style="font-family:inherit;font-size:10pt;">QUESTIONS AND ANSWERS RELATING TO THE RIGHTS OFFERING</font></a></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">4</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">PROSPECTUS SUMMARY</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">10</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">RISK FACTORS</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">15</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">SUMMARY OF THE RECAPITALIZATION</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">20</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">USE OF PROCEEDS</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">21</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">CAPITALIZATION</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">22</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">MARKET FOR THE COMMON STOCK AND DIVIDEND INFORMATION</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">23</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">24</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">SUBSCRIPTIONS BY DIRECTORS AND EXECUTIVE OFFICERS</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">26</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">THE RIGHTS OFFERING</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">27</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">DESCRIPTION OF CAPITAL STOCK</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">34</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">PLAN OF DISTRIBUTION</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">40</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">42</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">LEGAL MATTERS</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">44</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">EXPERTS</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">44</font></div></td></tr></table></div></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><hr style="page-break-after:always"><a name="sDECBA8391339AD514D378B32D3DA8F6C"></a><div></div><br><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">ABOUT THIS PROSPECTUS</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;text-indent:33px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">This prospectus incorporates important business and financial information about us that is not included in or delivered with this document.  This information is available without charge upon written or oral request.  See &#8220;Where You Can Find More Information&#8221; and &#8220;Incorporation of Certain Information by Reference.&#8221;</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">You should rely only on the information contained in or incorporated by reference into this prospectus. We have not, and nor has our subscription and information agent, Registrar and Transfer Company, authorized anyone to provide you with different information.  The information contained in this prospectus is accurate only as of the date of this prospectus regardless of the time of delivery of this prospectus or any exercise of the subscription rights. Our business, financial condition, results of operations and prospects may have changed since those dates.  We are not making an offer of these securities in any state or jurisdiction where the offer is not permitted.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">No action is being taken in any jurisdiction outside the United States to permit a public offering of the common stock or possession or distribution of this prospectus in that jurisdiction.  Persons who come into possession of this prospectus in jurisdictions outside the United States are required to inform themselves about and to observe any restrictions as to this offering and the distribution of this prospectus applicable to those jurisdictions.</font></div><div style="line-height:120%;text-align:left;text-indent:33px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Unless this prospectus indicates otherwise or the context otherwise requires, the terms &#8220;we,&#8221; &#8220;our,&#8221; &#8220;us,&#8221; the &#8220;Company&#8221; or &#8220;First Security&#8221; as used in this prospectus refer to First Security Group, Inc. and its subsidiaries, including FSGBank, N.A., which we sometimes refer to as &#8220;FSGBank.&#8221; </font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">This prospectus, including information included or incorporated by reference in this prospectus, contains statements which constitute forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act, and which statements are inherently subject to risks and uncertainties.  These statements are based on many assumptions and estimates and are not guarantees of future performance.  Forward looking statements are statements that include projections, predictions, expectations or beliefs about future events or results or otherwise are not statements of historical fact.  Such statements are often characterized by the use of qualifying words (and their derivatives) such as &#8220;may,&#8221; &#8220;would,&#8221; &#8220;could,&#8221; &#8220;should,&#8221; &#8220;will,&#8221; &#8220;expect,&#8221; &#8220;anticipate,&#8221; &#8220;predict,&#8221; &#8220;project,&#8221; &#8220;potential,&#8221; &#8220;continue,&#8221; &#8220;assume,&#8221; &#8220;believe,&#8221; &#8220;intend,&#8221; &#8220;plan,&#8221; &#8220;forecast,&#8221; &#8220;goal,&#8221; &#8220;estimate,&#8221; or other statements concerning opinions or judgments of First Security and its management about future events. Factors that could influence the accuracy of such forward looking statements include, but are not limited to, the financial success or changing strategies of FSGBank&#8217;s customers or vendors, actions of government regulators, the level of market interest rates, and general economic conditions. </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">These forward-looking statements involve risks and uncertainties and may not be realized due to a variety of factors.  There can be no assurance that the results, performance or achievements of the Company will not differ materially from those expressed or implied by forward-looking statements.  Factors that could cause actual events or results to differ significantly from those described in the forward-looking statements include, but are not limited to the following: </font></div><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:73px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">First Security's ability to comply with any requirements imposed on it or FSGBank by their respective regulators, and the potential negative consequences that result;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:73px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">deterioration in the financial condition of borrowers resulting in significant increases in loan losses and provisions for those losses;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:73px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">changes in loan underwriting, credit review or loss reserve policies associated with economic conditions, examination conclusions, or regulatory developments;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:73px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">changes in business policies or practices as a result of the changes in management;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:73px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the risk that First Security may be required to contribute additional capital to FSGBank in the future to enable it to meet its regulatory capital requirements or otherwise;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:73px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">changes in financial market conditions, either internationally, nationally or locally in areas in which First Security conducts its operations, including, without limitation, reduced rates of business formation and growth, commercial and residential real estate development, and real estate prices;</font></div></td></tr></table><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">1</font></div></div><hr style="page-break-after:always"><a name="sDECBA8391339AD514D378B32D3DA8F6C"></a><div></div><br><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:73px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the failure of assumptions underlying the establishment of reserves for possible loan losses;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:73px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">changes in accounting principles, policies, and guidelines applicable to bank holding companies and banking;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:73px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the impacts of renewed regulatory scrutiny on consumer protection and compliance led by the newly created Consumer Financial Protection Bureau;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:73px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">changes in capital standards and asset risk-weighting included in proposed Federal Reserve rules to implement the so-called &#8220;Basel III&#8221; accords;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:73px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">fluctuations in markets for equity, fixed-income, commercial paper and other securities, which could affect availability, market liquidity levels, and pricing;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:73px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">governmental monetary and fiscal policies including the undetermined effects of the Federal Reserve&#8217;s "Quantitative Easing" programs, as well as legislative and regulatory changes, including, but not limited to, implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the &#8220;Dodd-Frank Act&#8221;).</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:73px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">changes in political and economic conditions, including the political and economic effects of the current economic downturn and other major developments, including the ongoing war on terrorism, continued tensions in the Middle East, and the ongoing economic challenges facing the European Union and other international markets;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:73px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the risks of changes in interest rates on the level and composition of deposits, loan demand and the values of loan collateral, securities and interest sensitive assets and liabilities;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:73px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds and other financial institutions operating in our market area and elsewhere, including institutions operating regionally, nationally and internationally, together with such competitors offering banking products and services by mail, telephone and the Internet;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:73px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the effect of any mergers, acquisitions or other transactions, to which we or FSGBank may from time to time be a party, including, without limitation, our ability to successfully integrate any businesses that we acquire;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:73px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">uncertainty regarding the amount of proceeds received from the rights offering; </font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:73px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the effects of the rights offering or the terms thereof on the price of our common stock;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:73px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">our ability to terminate the rights offering; and</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:73px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the other risk factors described under the heading &#8220;Risk Factors&#8221; in this prospectus or incorporated by reference into this prospectus.</font></div></td></tr></table><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Many of these risks are beyond our ability to control or predict, and you are cautioned not to put undue reliance on such forward-looking statements.  First Security does not intend to update or reissue any forward-looking statements contained in this prospectus as a result of new information or other circumstances that may become known to First Security, and undertakes no obligation to provide any such updates. </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by this Special Note.  </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">For other factors, risks and uncertainties that could cause our actual results to differ materially from estimates and projections contained in these forward-looking statements, please read the &#8220;Risk Factors&#8221; section of this prospectus beginning on page 15 and the information contained in the section entitled &#8220;Risk Factors&#8221; in our Annual Report on Form 10-K for the year ended December 31, 2012 and any risks described in our other filings with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act.</font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">2</font></div></div><hr style="page-break-after:always"><a name="sDECBA8391339AD514D378B32D3DA8F6C"></a><div></div><br><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">WHERE YOU CAN FIND MORE INFORMATION</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We are subject to the informational requirements of the Exchange Act, and file with the SEC proxy statements, Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.  You may read and copy any document we file at the SEC&#8217;s public reference room at 100 F Street, NE, Room 1580, Washington, D.C. 20549.  Please call the SEC at 1-800-SEC-0330 for further information on the public reference rooms.  Our SEC filings are also available to the public from the SEC&#8217;s web site at www.sec.gov or on our website at www.fsgbank.com</font><font style="font-family:inherit;font-size:10pt;font-style:italic;">.</font><font style="font-family:inherit;font-size:10pt;">&#32;&#32;Information on, or that can be accessible through, our website does not constitute a part of, and is not incorporated by reference in, this prospectus. </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">This prospectus, which is a part of a registration statement on Form S-1 that we have filed with the SEC under the Securities Act, omits certain information set forth in the registration statement.  Accordingly, for further information, you should refer to the registration statement and its exhibits on file with the SEC.  Furthermore, statements contained in this prospectus concerning any document filed as an exhibit are not necessarily complete and, in each instance, we refer you to the copy of such document filed as an exhibit to the registration statement. </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:12pt;"><font style="font-family:inherit;font-size:12pt;"><br></font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">INCORPORATION OF CERTAIN INFORMATION BY REFERENCE</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The SEC allows us to incorporate by reference the information we file with it, which means that we can disclose important information to you by referring you to those documents filed separately with the SEC.  The information we incorporate by reference is an important part of this prospectus.  We incorporate by reference the documents listed below, except to the extent that any information contained in those documents is deemed &#8220;furnished&#8221; in accordance with SEC rules.  The documents we incorporate by reference, all of which we have previously filed with the SEC, include: </font></div><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:93px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:12pt;padding-left:46px;"><font style="font-family:inherit;font-size:12pt;">&#8226;</font></div></td><td style="vertical-align:top;padding-left:2.6666666666666665px;"><div style="line-height:120%;text-align:left;font-size:12pt;text-indent:-2.6666666666666665px;"><font style="font-family:inherit;font-size:10pt;">Our Annual Report on Form 10-K for the year ended December 31, 2012, filed with the SEC on April 15, 2013; </font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:93px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:12pt;padding-left:46px;"><font style="font-family:inherit;font-size:12pt;">&#8226;</font></div></td><td style="vertical-align:top;padding-left:2.6666666666666665px;"><div style="line-height:120%;text-align:left;font-size:12pt;text-indent:-2.6666666666666665px;"><font style="font-family:inherit;font-size:10pt;">Our Quarterly Report on Form 10-Q for the quarter ended March 31, 2013, filed with the SEC on May 15, 2013; and</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:93px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:12pt;padding-left:46px;"><font style="font-family:inherit;font-size:12pt;">&#8226;</font></div></td><td style="vertical-align:top;padding-left:2.6666666666666665px;"><div style="line-height:120%;text-align:left;font-size:12pt;text-indent:-2.6666666666666665px;"><font style="font-family:inherit;font-size:10pt;">Our Current Reports on Form 8-K filed with the SEC on February 26, 2013, March 22, 2013, April 10, 2013, April 12, 2013, May 17, 2013 and June 12, 2013.</font></div></td></tr></table><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:46px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">A description of our capital stock can be found herein under &#8220;Description of Our Capital Stock.&#8221; </font></div><div style="line-height:120%;text-align:left;text-indent:46px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">You may request a copy of any of these filings at no cost, by writing or telephoning John R. Haddock, Chief Financial Officer, at (423) 308-2075, </font><font style="font-family:inherit;font-size:10pt;font-style:italic;text-decoration:underline;">jhaddock@FSGBank.com</font><font style="font-family:inherit;font-size:10pt;">, or at the following address or telephone number:  First Security Group, Inc, 531 Broad Street, Chattanooga, Tennessee 37402 or (423) 266-2000.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">3</font></div></div><hr style="page-break-after:always"><a name="sDECBA8391339AD514D378B32D3DA8F6C"></a><div></div><br><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">QUESTIONS AND ANSWERS RELATING TO THE RIGHTS OFFERING</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">The following are examples of what we anticipate will be common questions about the rights offering.  The answers are based on selected information included elsewhere in this prospectus.  The following questions and answers do not contain all of the information that may be important to you and may not address all of the questions that you may have about the rights offering.  This prospectus contains more detailed descriptions of the terms and conditions of the rights offering and provides or incorporates by reference additional information about us and our business, including potential risks related to the rights offering, our common stock and our business.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">What is the rights offering?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We are distributing, at no charge, to holders of shares of our common stock as of the record date, non-transferable subscription rights to purchase shares of our common stock.  You will receive one subscription right for each share of common stock you owned as of 5:00 p.m., Eastern Time, on April 10, 2013, the record date.  Each subscription right entitles the holder to a basic subscription privilege and an over-subscription privilege, which are described below.  The shares of common stock to be issued in the rights offering, like our existing shares of common stock, will be traded on the NASDAQ Capital Market under the symbol &#8220;FSGI.&#8221; </font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Why are we conducting the rights offering?</font></div><div style="line-height:120%;text-align:left;text-indent:46px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On February 25, 2013, the Company entered into a number of agreements in connection with a $91.1 million recapitalization (the &#8220;Recapitalization&#8221;), including a Stock Purchase Agreement by and among the Company and the investors named therein (the &#8220;Stock Purchase Agreement&#8221;).  Those agreements required the Company to issue and sell in a private placement (the &#8220;Private Placement&#8221;), approximately 60,735,000 shares of common stock at a price per share of $1.50 (the &#8220;Purchase Price&#8221;).  The closing of the Private Placement occurred over two days.  On April 11, 2013 (the &#8220;TARP Closing Date&#8221;), the Company issued 9,941,908 shares of common stock to the United States Department of the Treasury (the &#8220;Treasury&#8221;) in exchange for 33,000 shares of the Company&#8217;s Fixed Rate Cumulative Perpetual Preferred Stock, Series A (the &#8220;TARP Preferred Stock&#8221;), a warrant to purchase 82,363 shares of the Company&#8217;s common stock (the &#8220;TARP Warrant&#8221;) and all accrued but unpaid dividends on the TARP Preferred Stock.  Treasury then immediately sold such shares of common stock to investors.  On April 12, 2013 (the &#8220;Investor Closing Date&#8221;), the Company sold 50,793,092 shares of common stock directly to investors.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">As required by the Stock Purchase Agreement, we are conducting this rights offering to holders of our common stock as of April 10, 2013 (the &#8220;Pre-Recapitalization Shareholders&#8221;) to provide the Pre-Recapitalization Shareholders with the opportunity to purchase up to approximately $5 million of our common stock at a purchase price per share equal to the Purchase Price paid by investors under the Stock Purchase Agreement.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">What is the basic subscription privilege?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The basic subscription privilege gives the Pre-Recapitalization Shareholders the opportunity to purchase an aggregate of 3,329,234 shares of our common stock at a subscription price of $1.50 per share.  For each share of our common stock you owned as of the record date for the rights offering, your basic subscription privilege gives you the opportunity to purchase two shares of our common stock.  For example, if you owned 100 shares of common stock as of the record date, you would have received 100 subscription rights and would have the right to purchase 200 shares of our common stock for $1.50 per full share (or a total payment of $300.00).  You may exercise all or a portion of your basic subscription privilege, or you may choose not to exercise any subscription rights at all.  If you exercise less than your full basic subscription privilege, however, you will not be entitled to subscribe for shares under your over-subscription privilege.  We will not issue fractional shares through the exercise of the basic subscription privilege.  </font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you hold a First Security stock certificate, the number of rights you may exercise pursuant to your basic subscription privilege is indicated on the enclosed rights certificate.  If you hold your shares in the name of a custodian bank, broker, dealer or other nominee, you will not receive a rights certificate.  Instead, the Depository Trust Company will issue one subscription right to the nominee record holder for each share of our common stock that you owned at the record date.  If you are not contacted by your custodian bank, broker, dealer or other nominee, you should contact your nominee as soon as possible.  If the rights are attributable to shares that were held through the First Security Group, Inc. 401(k) and Employee Stock Ownership Plan (the &#8220;401(k) Plan&#8221;), you should follow the separate instructions provided to you by the tabulator designated by the trustee of the plan with respect to the shares held in that plan.</font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">4</font></div></div><hr style="page-break-after:always"><a name="sDECBA8391339AD514D378B32D3DA8F6C"></a><div></div><br><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">What is the over-subscription privilege?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In the event that you purchase all of the shares of our common stock available to you pursuant to your basic subscription privilege, you may also choose to purchase a portion of any shares of our common stock that are not purchased by our other Pre-Recapitalization Shareholders through the exercise of their basic subscription privileges, as applicable.  </font><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">You should indicate on your rights certificate how many additional shares you would like to purchase pursuant to your over-subscription privilege</font><font style="font-family:inherit;font-size:10pt;">.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If sufficient shares of common stock are available, we will seek to honor your over-subscription request in full.  If, however, over-subscription requests exceed the number of shares of common stock available, we will allocate the available shares of common stock pro rata based on the relative ownership percentages as of the record date of shareholders requesting additional shares.  We may exercise our discretion to round down to allocate shares in ten share increments.  As described above for the basic subscription privilege, we will not issue fractional shares through the exercise of over-subscription privileges.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In order to properly exercise your over-subscription privilege, you must deliver the subscription payment related to your over-subscription privilege at the time you deliver payment related to your basic subscription privilege.  Because we will not know the actual number of unsubscribed shares prior to the expiration of the rights offering, if you wish to maximize the number of shares you purchase pursuant to your over-subscription privilege, you will need to deliver payment in an amount equal to the aggregate subscription price for the maximum number of shares of our common stock that may be available to you.  See &#8220;The Rights Offering&#8212;Subscription Rights&#8212;Over-Subscription Privilege.&#8221;</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">How was the $1.50 per share subscription price determined?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Stock Purchase Agreement we previously entered into with investors provides that, as promptly as practicable following completion of the Recapitalization, First Security must conduct a rights offering to shareholders of record immediately prior to the Recapitalization pursuant to which such Pre-Recapitalization Shareholders may purchase up to $5.0 million of our common stock at a purchase price of $1.50 per share.  The $1.50 per share subscription price is designed to provide Pre-Recapitalization Shareholders with the opportunity to purchase shares of our common stock at the same price as the price of the common stock purchased by or issued to investors in the Recapitalization.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The subscription price is not necessarily related to our book value, net worth or any other established criteria of value and may or may not be considered the fair value of our common stock to be offered in the rights offering.  You should not assume or expect that, after the rights offering, our shares of common stock will trade at or above the $1.50 purchase price.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Am I required to exercise all of the subscription rights I receive in the rights offering?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">No.  You may exercise any number of your subscription rights, or you may choose not to exercise any subscription rights.  If you do not exercise any subscription rights, the number of shares of our common stock you own will not change.  However, if you choose not to exercise your basic subscription privilege in full, your ownership interest in our common stock will be diluted as a result of the rights offering.  In addition, if you do not exercise your basic subscription privilege in full, you will not be entitled to participate in the over-subscription privilege.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">How soon must I act to exercise my subscription rights?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you received a rights certificate and elect to exercise any or all of your subscription rights, the subscription agent must receive your completed and signed rights certificate and payment prior to the expiration of the rights offering, which is </font><font style="font-family:inherit;font-size:10pt;">_________, 2013, at 5:00 p.m., Eastern Time.  If you hold your shares in the name of a custodian bank, broker, dealer or other nominee, your nominee may establish a deadline prior to 5:00 p.m. Eastern Time, on _________, 2013 by which you must provide it with your instructions to exercise your subscription rights and payment for your shares.  If the subscription rights are attributable to shares that were held in your account in the 401(k) Plan, you must provide your instructions to the tabulator designated by the trustee of the plan no later than the date and time specified in the separate instructions applicable to those shares. Our board of directors may, in its discretion, extend the rights offering one or more times, but in no event will the expiration date be later than _________, 201</font><font style="font-family:inherit;font-size:10pt;">3.  Our board of directors may, in its discretion, cancel or amend the rights offering at any time. In </font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">5</font></div></div><hr style="page-break-after:always"><a name="sDECBA8391339AD514D378B32D3DA8F6C"></a><div></div><br><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the event that the rights offering is cancelled, all subscription payments received will be returned promptly, without interest or penalty.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Although we will make reasonable attempts to provide this prospectus to holders of subscription rights, the rights offering and all subscription rights will expire at 5:00 p.m., Eastern Time on </font><font style="font-family:inherit;font-size:10pt;">_________</font><font style="font-family:inherit;font-size:10pt;">, 2013 (unless extended), whether or not we have been able to locate each person entitled to subscription rights.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">May I transfer my subscription rights?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">No. You may not sell, transfer or assign your subscription rights to anyone.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Subscription rights will not be traded on the NASDAQ Capital Market or any other stock exchange or market.  Rights certificates may only be completed by the shareholder who receives the certificate.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Are we requiring a minimum subscription to complete the rights offering?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">There is no individual or aggregate minimum purchase requirement in the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Is there a limit to how much stock is being issued in the rights offering?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We will accept subscriptions for up to an aggregate of 3,329,234 shares of common stock in the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Has our board of directors made a recommendation to our shareholders regarding the rights offering?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">No.  Our board of directors is making no recommendation regarding your exercise of the subscription rights.  Shareholders who exercise subscription rights risk investment loss on new money invested.  We cannot predict the price at which our shares of common stock will trade; therefore, we cannot assure you that the market price for our common stock will be above the subscription price or that anyone purchasing shares at the subscription price will be able to sell those shares in the future at the same price or a higher price.  You are urged to make your decision based on your own assessment of our business and the rights offering.  Please see &#8220;Risk Factors&#8221; for a discussion of some of the risks involved in investing in our common stock.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Are there any limits on the number of shares I may purchase in the rights offering?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Subject to the discretion of the board of directors, a person, together with certain related persons and associates, may not purchase a number of shares such that upon completion of the rights offering the person owns securities representing in excess of 4.9% of the Company&#8217;s outstanding shares of common stock.  Additionally, federal law generally requires prior regulatory approval for any person or persons acting in concert to acquire 10% or more of our common stock.  We also will not issue shares of our common stock pursuant to the exercise of basic subscription rights or over-subscription rights to any person or entity who, in our sole opinion, could be required to obtain prior clearance or approval from or submit a notice to any state or federal bank regulatory authority to acquire, own or control such shares if, as of </font><font style="font-family:inherit;font-size:10pt;">_________</font><font style="font-family:inherit;font-size:10pt;">, 2013, we determine that such clearance or approval has not been obtained and/or any applicable waiting period has not expired.  If we elect not to issue shares in either such case, the unissued shares will become available to satisfy over-subscription elections by other shareholders pursuant to their subscription rights.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">How do I exercise my subscription rights if I own shares in certificated form?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you hold a First Security stock certificate and you wish to participate in the rights offering, you must take the following steps:</font></div><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">deliver a properly completed and signed rights certificate, and related subscription documents, to the subscription agent before 5:00 p.m., Eastern Time, o</font><font style="font-family:inherit;font-size:10pt;">n _________, 2013; and</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">deliver payment to the subscription agent before 5:00 p.m., Eastern Time, on _________, 2013.</font></div></td></tr></table><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In certain cases, you may be required to provide additional documentation or signature guara</font><font style="font-family:inherit;font-size:10pt;">ntees.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Please follow the delivery instructions on the rights certificate.  Do not deliver documents to First Security.  You are solely responsible for completing delivery to the subscription agent of your subscription documents, rights certificate and payment.  We urge you to allow sufficient time for delivery of your subscription materials to the </font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">6</font></div></div><hr style="page-break-after:always"><a name="sDECBA8391339AD514D378B32D3DA8F6C"></a><div></div><br><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">subscription agent so that they are received by the subscription agent by 5:00 p.m. Eastern Time, on </font><font style="font-family:inherit;font-size:10pt;">___________,</font><font style="font-family:inherit;font-size:10pt;">&#32;2013.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you send a payment that is insufficient to purchase the number of shares you requested, or if the number of shares you requested is not specified in the forms, the payment received will be applied to exercise your subscription rights to the fullest extent possible based on the amount of the payment received, subject to the availability of shares under the over-subscription privilege and the elimination of fractional shares. Any excess subscription payments received by the subscription agent will be returned, without interest, as soon as practicable following the expiration of the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">What form of payment is required to purchase the shares of our common stock in the rights offering?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">As described in the instructions accompanying the rights certificate, payments submitted to the subscription agent must be made in full in United States currency by:</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">personal check payable to Registrar and Transfer Company, our subscription agent, drawn upon a United States bank;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">bank check or bank draft payable to Registrar and Transfer Company, drawn upon a United States bank;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">postal, telegraphic or express money order payable to Registrar and Transfer Company; or</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">wire transfer of immediately available funds to the account maintained Registrar and Transfer Company. </font></div></td></tr></table><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you are issued subscription rights attributable to shares that were held in your account in the 401(k) Plan, the payment for the exercise of those subscription rights will be deducted from funds held in your account in the 401(k) Plan as described in more detail in the separate instructions applicable to those rights.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">What should I do if I want to participate in the rights offering, but my shares are held in the name of a custodian bank, broker, dealer or other nominee?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you hold your shares of common stock through a custodian bank, broker, dealer or other nominee, then your nominee is the record holder of the shares you own.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you are not contacted by your nominee, you should contact your nominee as soon as possible.  Your nominee must exercise the subscription rights on your behalf for the shares of common stock you wish to purchase.  You will not receive a rights certificate.  Please follow the instructions of your nominee.  Your nominee may establish a deadline that may be before the 5:00 p.m., Eastern Time, </font><font style="font-family:inherit;font-size:10pt;">_________</font><font style="font-family:inherit;font-size:10pt;">, 2013 expiration date that we have established for the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">When will I receive my new shares?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you purchase stock in the rights offering by submitting a rights certificate and payment, we will mail you a stock certificate as soon as practicable after the expiration date of the rights offering.  If your shares as of April 10, 2013 were held by a custodian bank, broker, dealer or other nominee, and you participate in the rights offering, you will not receive stock certificates for your new shares.  Your nominee will be credited with the shares of common stock you purchase in the rights offering as soon as practicable after the expiration of the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">After I send in my payment and rights certificate, may I cancel my exercise of subscription rights?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">No.  All exercises of subscription rights are irrevocable unless the rights offering is terminated, even if you later learn information that you consider to be unfavorable to the exercise of your subscription rights.  You should not exercise your subscription rights unless you are certain that you wish to purchase shares of our common stock in the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Are there any conditions to completing the rights offering?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">No, there are no conditions to completing the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Will our directors and officers participate in the rights offering?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">As of April 10, 2013, our current directors and executive officers owned approximately 142,019 shares of our common stock.  Due to the number of outstanding shares of our common stock as of the record date of the rights </font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">7</font></div></div><hr style="page-break-after:always"><a name="sDECBA8391339AD514D378B32D3DA8F6C"></a><div></div><br><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">offering, in order to facilitate the Company&#8217;s compliance with the $5,000,000 maximum rights offering amount imposed by the Stock Purchase Agreement and still offer each Pre-Recapitalization Shareholder the right to purchase two shares of our common stock, five of the Company&#8217;s directors and executive officers holding an aggregate of 23,750 shares on the record date have waived their right to participate in the rights offering.  In addition, 63,750 of the shares of restricted stock owned by directors and executive officers as of the record date were forfeited and are not eligible to participate in the rights offering.  As a result, our directors and executive officers collectively hold rights to purchase 109,038 shares of our common stock in the rights offering.  Certain of our directors and executive officers have indicated an interest in participating in the rights offering.  Collectively, we expect our directors and executive officers to purchase approximately </font><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#160;&#160;&#160;&#160;</font><font style="font-family:inherit;font-size:10pt;">&#32;shares of our common stock in the rights offering.  Our directors and executive officers are entitled to participate in the rights offering on the same terms and conditions applicable to all Pre-Recapitalization Shareholders.  Following the rights offering, our current directors and executive officers, together with their affiliates, are expected to beneficially own </font><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font><font style="font-family:inherit;font-size:10pt;">&#32;shares of common stock, or approxima</font><font style="font-family:inherit;font-size:10pt;">tely _</font><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#32;&#32;</font><font style="font-family:inherit;font-size:10pt;">% of our outstanding common stock, assuming that all shares are subscribed for in the rights offering and that no directors, executive officers or their affiliates participate in the oversubscription aspect of the rights offering.  See &#8220;Security Ownership of Certain Beneficial Owners And Management.&#8221;</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">After I send in my acknowledgement of subscription and my payment, may I cancel my exercise of subscription rights?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Once you submit the acknowledgement of subscription and your payment, you will not be allowed to revoke your subscription or request a refund of monies paid.  All acknowledgements of subscriptions are irrevocable, even if you learn information about us that you consider to be unfavorable.  You should not submit an acknowledgement of subscription unless you are certain that you wish to purchase shares of our common stock at the subscription price.  However, with respect to subscription rights issued to your account in the 401(k) Plan, if the market price of the stock is less than the subscription price on the date the rights are exercised, the trustee will not execute your instructions to purchase the common stock and your money will be refunded to your account in the 401(k) Plan.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">What effects will the rights offering have on our outstanding common stock?</font></div><div style="line-height:120%;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">As of April 10, 2013, 1,795,542</font><font style="font-family:inherit;font-size:10pt;font-weight:bold;">&#32;</font><font style="font-family:inherit;font-size:10pt;">shares of our common stock were issued and outstanding. On April 11, 2013 and April 12, 2013, the date following the record date for the rights offering, we issued an additional 60,735,000 shares of common stock in the Recapitalization and 107,175 shares of restricted stock were forfeited pursuant to the terms of the Exchange Agreement, leaving us with 62,423,367 shares of common stock outstanding immediately following the Recapitalization.  Assuming no options are exercised prior to the expiration of the rights offering and assuming all 3,329,234 shares are sold in the rights offering, we expect 65,752,601 shares of our common stock will be outstanding immediately after completion of the rights offering.</font></div><div style="line-height:120%;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The issuance of shares of our common stock in the rights offering will further dilute, and thereby reduce, your proportionate ownership in shares of our common stock unless you fully exercise your basic subscription privilege.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">How much will we receive in net proceeds from the rights offering? </font></div><div style="line-height:120%;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If the rights offering is fully subscribed, we expect that the aggregate rights offering proceeds, net of dealer manager fees and expenses, to be approximately $4.475 million.  We intend to use the offering proceeds to supplement the capital of First Security and for general corporate purposes.  See &#8220;Use of Proceeds.&#8221;</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Are there risks in exercising my subscription rights?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Yes.  The exercise of your subscription rights involves risks.  Exercising your subscription rights involves the purchase of additional shares of our common stock and should be considered as carefully as you would consider any other equity investment. Among other things, you should carefully consider the risks described under the heading &#8220;Risk Factors&#8221; in this prospectus and the information incorporated by reference herein and contained in the section entitled "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2012 and any risks described in our other filings with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act.</font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">8</font></div></div><hr style="page-break-after:always"><a name="sDECBA8391339AD514D378B32D3DA8F6C"></a><div></div><br><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">If the rights offering is not completed, will my subscription payment be refunded to me?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Yes.  The subscription agent will hold all funds it receives in a segregated bank account until completion of the rights offering.  If the rights offering is not completed, all subscription payments received by the subscription agent will be returned promptly, without interest or penalty.  If your shares are held in the name of a custodian bank, broker, dealer or other nominee, it may take longer for you to receive the refund of your subscription payment because the subscription agent will return payments through the record holder of your shares.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">What fees or charges apply if I purchase shares of the common stock in the rights offering?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We are not charging any fee or sales commission to issue subscription rights to you or to issue shares to you if you exercise your subscription rights (other than the subscription price).  If you exercise your subscription rights through a custodian bank, broker, dealer or other nominee, you are responsible for paying any fees or sales commissions your nominee may charge you.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Who should I contact if I have other questions?</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you have other questions regarding First Security or the rights offering, please contact our dealer manager, Raymond James &amp; Associates, Inc., at 404-240-2907 (or toll-free at 866-777-7789), attention: Sanjay Patel, Monday through Friday (except bank holidays), between 9:00 a.m. and 5:00 p.m., Eastern Time. </font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">9</font></div></div><hr style="page-break-after:always"><a name="s0E51DAB27644EC98C7C68B32D428244B"></a><div></div><br><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">PROSPECTUS SUMMARY</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">This prospectus summary highlights the information contained elsewhere in this prospectus.  Because this is only a summary, it does not contain all of the information that you should consider before deciding whether to exercise your subscription rights.  You should read this entire prospectus carefully, including the information set forth in &#8220;Risk Factors,&#8221; and the documents identified in the sections &#8220;Where You Can Find More Information&#8221; and &#8220;Incorporation of Certain Documents by Reference&#8221; in this prospectus, in their entirety before you decide to exercise your subscription rights.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">First Security Group, Inc. and FSGBank</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;text-indent:46px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We are a bank holding company headquartered in Chattanooga, Tennessee.  Founded in 1999, First Security's community bank subsidiary, FSGBank, has 30 full-service banking offices along the interstate corridors of eastern and middle Tennessee and northern Georgia.  In Dalton, Georgia, FSGBank operates under the name &#8220;Dalton Whitfield Bank,&#8221; and along the Interstate 40 corridor in Tennessee, FSGBank operates under the name &#8220;Jackson Bank &amp; Trust.&#8221;  </font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;text-indent:46px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Through FSGBank, we offer a range of lending services that are primarily secured by single and multi-family real estate, residential construction and owner-occupied commercial buildings.  In addition, we focus on serving the needs of small- to medium-sized businesses, by offering a range of lending, deposit and wealth management services to these businesses and their owners.  Our principal source of funds for loans and securities is core deposits gathered through our branch network.  We offer a wide range of deposit services, including checking, savings, money market accounts and certificates of deposit, and obtain most of our deposits from individuals and businesses in our market areas, including the vast majority of our loan customers.  Our wealth management division offers private client services, financial planning, trust administration, investment management and estate planning services.  We also provide mortgage banking and electronic banking services, such as Internet banking, online bill payment, cash management, ACH originations, and remote deposit capture.  We actively pursue business relationships by utilizing the business contacts of our Board of Directors, senior management and local bankers, thereby capitalizing on our extensive knowledge of the local marketplace. </font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;text-indent:40px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">As of March 31, 2013, we had total assets of approximately $1.0 billion, total deposits of approximately $990.9 million and tangible shareholders&#8217; equity of approximately $20.5&#160;million.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">The Recapitalization</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;text-indent:46px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On February 25, 2013, the Company entered into a number of agreements in connection with its $91.1 million Recapitalization, including the Stock Purchase Agreement.  Those agreements required the Company to issue and sell, in a Private Placement, 60,735,000 shares of common stock at the Purchase Price of $1.50 per share.  The closing of the Private Placement took place over two days, with the issuance of 9,941,908 shares of common stock to Treasury in exchange for 33,000 shares of the Company&#8217;s TARP Preferred Stock, the TARP Warrant to purchase 82,363 shares of common stock, and all accrued but unpaid dividends on the TARP Preferred Stock, and the sale by Treasury of such shares of common stock to investors occurring on the TARP Closing Date of April 11, 2013, and the sale of 50,793,092 shares of common stock directly to investors occurring on the Investor Closing Date, April 12, 2013.  See &#8220;Summary of the Recapitalization.&#8221;</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;text-indent:40px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Pursuant to the Stock Purchase Agreement, 60,735,000 shares of our common stock sold in the Recapitalization have been registered for resale on a registration statement on Form S-1 (File No. 333-188137) that was declared effective by the SEC on June 6, 2013.  The investors in our Recapitalization are no longer subject to lock-up agreements or any other contractual agreements not to dispose of our shares and these shares are freely transferable.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Regulatory Matters </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">First Security Group, Inc.</font><font style="font-family:inherit;font-size:10pt;font-style:italic;">&#32;</font><font style="font-family:inherit;font-size:10pt;">&#32;On September 7, 2010, the Company entered into a Written Agreement (the &#8220;Agreement&#8221;) with the Federal Reserve Bank of Atlanta (the &#8220;Federal Reserve&#8221;), the Company&#8217;s primary regulator.  The Agreement places restrictions on the Company that are designed to enhance the Company&#8217;s ability to act as a source of strength to the Company's wholly owned subsidiary, FSGBank.  The Agreement prohibits the Company </font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">10</font></div></div><hr style="page-break-after:always"><a name="s0E51DAB27644EC98C7C68B32D428244B"></a><div></div><br><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">from declaring or paying dividends without prior written consent of the Federal Reserve.  The Company is also prohibited from taking dividends, or any other form of payment representing a reduction of capital, from FSG Bank without prior written consent.  Within 60 days of the Agreement, the Company was required to submit to the Federal Reserve a written plan designed to maintain sufficient capital at the Company and the FSGBank.  The Company submitted a copy of FSGBank&#8217;s capital plan that had previously been submitted to FSGBank&#8217;s primary regulator, the Office of the Comptroller of the Currency (the &#8220;OCC&#8221;).  During May 2013, the OCC requested updated capital and strategic plans based on the Recapitalization.  On July 1, 2013, FSGBank submitted capital and strategic plans to the OCC.  The plans were also submitted to the Federal Reserve by the Company.  We can give no assurance that the Federal Reserve or the OCC will approve our capital and strategic plans.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Company is currently deemed not in compliance with several provisions of the Agreement.  Any material noncompliance may result in further enforcement actions by the Federal Reserve.  Management believes the successful execution of the strategic initiatives discussed below will ultimately result in full compliance with the Agreement and position the Company for long-term growth and a return to profitability.  </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Company's regulatory capital ratios as of March 31, 2013 were as follows: Tier 1 leverage ratio was 1.90% and total risk-based capital ratio was 4.68%.  On April 11-12, 2013, the Company issued 60,735,000 shares of common stock in the Private Placement.  After accounting for the net proceeds from the Private Placement, the Company&#8217;s pro forma regulatory capital ratios as of March 31, 2013 were as follows:  Tier 1 leverage ratio was 9.0% and total risk-based capital ratio was 17.5%.  </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Agreement is incorporated by reference as Exhibit&#160;10.20 to the registration statement of which this prospectus is a part and incorporated by reference herein.  The foregoing summary is not complete and is qualified in all respects by reference to the actual language of the Agreement.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">FSGBank.  </font><font style="font-family:inherit;font-size:10pt;">On April 28, 2010, pursuant to a Stipulation and Consent to the Issuance of a Consent Order, FSGBank consented and agreed to the issuance of a Consent Order by the OCC (the &#8220;Order&#8221;).  FSGBank and the OCC agreed to the areas of FSGBank&#8217;s operations that warrant improvement and on a plan for making those improvements.  The Order required FSGBank to develop and submit written strategic and capital plans covering at least a three year period.  The Board of Directors is required to ensure that competent management is in place in all executive officer positions to manage the FSGBank in a safe and sound manner.  In response, the Company and FSGBank underwent a restructuring of their executive and senior management teams. FSGBank is also required to review and revise various policies and procedures, including those associated with credit concentration management, the allowance for loan and lease losses, liquidity management, criticized assets, loan review and credit.  FSGBank is continuing to work with the OCC to ensure the policies and procedures are both appropriate and fully implemented. </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Within 120 days of the effective date of the Order, FSGBank was required to achieve and thereafter maintain total capital at least equal to 13.0% of risk-weighted assets and Tier 1 capital at least equal to 9.0% of adjusted total assets.  FSGBank has not achieved compliance with the capital requirements of the Order.  As of March 31, 2013, the eleventh financial reporting period subsequent to the 120 day requirement, FSGBank&#8217;s total capital to risk-weighted assets was 4.7% and the Tier 1 capital to adjusted total assets was 1.9%.  After accounting for the $65.0 million capital contribution by the Company into FSGBank, FSGBank's pro-forma regulatory capital ratios as of March 31, 2013 were as follows: Tier 1 leverage ratio was 8.1%, Tier 1 risk-based capital ratio was 14.5% and total risk-based capital ratio was 15.8%.  FSGBank has notified the OCC of its non-compliance with the requirements of the Order.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">During the third quarter of 2010, the OCC requested additional information and clarifications to FSGBank's submitted strategic and capital plans as well as the management assessments.  Subsequent to the resignation of its chief executive officer in April 2011, FSGBank requested an extension on the submission date for the strategic and capital plans until a new chief executive officer was appointed and had sufficient time to modify the strategic plan.  Strategic and capital plans covering three-years have been revised to reflect the actual terms and timing of the Recapitalization and were submitted to the OCC and Federal Reserve on July 1, 2013 for approval.  We can give no assurance that the Federal Reserve or the OCC will approve our capital and strategic plans.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Effective with the Order, FSGBank has been restricted from paying interest on deposits that is more than 0.75% above the rate applicable to the applicable market of FSGBank as determined by the Federal Deposit Insurance Corporation (the &#8220;FDIC&#8221;).  Additionally, FSGBank may not accept, renew or roll over brokered deposits without prior approval of the FDIC. </font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">11</font></div></div><hr style="page-break-after:always"><a name="s0E51DAB27644EC98C7C68B32D428244B"></a><div></div><br><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">FSGBank is currently deemed not in compliance with several provisions of the Order, including the capital requirements.  However, management believes that the completed Recapitalization will significantly improve compliance with the requirements of the Order.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Order is incorporated by reference in Exhibit&#160;10.18 to the registration statement of which this prospectus is a part and incorporated by reference herein.  The foregoing summary is not complete and is qualified in all respects by reference to the actual language of the Order. </font></div><div style="line-height:120%;text-align:left;text-indent:40px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">As of September 30, 2012, FSGBank's Tier I leverage ratio fell below the minimum level for an "adequately capitalized" bank of 4.0%.  As described below, there are three classifications for banks that are below "adequately capitalized," as follows: "undercapitalized," "significantly undercapitalized," and "critically undercapitalized."  As of December 31, 2012, FSGBank was reclassified from "undercapitalized" to "significantly undercapitalized" upon the filing of the call report on January 30, 2013.  As of March 31, 2013, FSGBank was reclassified to "critically undercapitalized" upon the filing of the call report on April 30, 2013.  Following the Recapitalization, on April 23, 2013, FSGBank filed a cash contribution to capital notice with the OCC certifying a $65.0 million capital contribution by the Company into FSGBank.  With that capital contribution, FSGBank's pro forma regulatory capital ratios as of March 31, 2013 increased as follows:  Tier 1 leverage ratio from 1.9% to 8.1%, Tier 1 risk-based capital ratio from 3.4% to 14.5% and total risk-based capital ratio from 4.7% to 15.8%.  All pro forma regulatory capital measures exceed the percentages of a well capitalized institution as defined under applicable regulatory guidelines; however, FSGBank's Tier 1 leverage ratio continues to be below the 9.0% required by the Order.  FSGBank will continue to be classified as adequately capitalized due to the capital requirements in the Order.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Corporate Information</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;text-indent:46px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Our common stock is traded on the NASDAQ Capital Market under the symbol &#8220;FSGI.&#8221;  We were incorporated in the state of Tennessee on February 1, 1999.  Our principal executive offices are located at 531 Broad Street, Chattanooga, Tennessee 37402, and our telephone number is (423)&#160;266-2000.  Our internet address is www.fsgbank.com.  The information contained on our website is not part of this prospectus.</font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">12</font></div></div><hr style="page-break-after:always"><a name="s0E51DAB27644EC98C7C68B32D428244B"></a><div></div><br><div style="line-height:120%;padding-bottom:8px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Summary of Rights Offering</font></div><div style="line-height:120%;padding-bottom:16px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">The following summary describes the principal terms of the rights offering, but is not intended to be complete. See the information under the heading &#8220;The Rights Offering&#8221; in this prospectus for a more detailed description of the terms and conditions of the rights offering.</font></div><div style="line-height:120%;font-size:10pt;"><div style="padding-left:0px;text-indent:0px;line-height:normal;padding-top:10px;"><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman;font-size:10pt;width:100%;border-collapse:collapse;text-align:left;"><tr><td colspan="2"></td></tr><tr><td width="30%"></td><td width="70%"></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Securities Offered</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We are distributing to you, at no charge, one non-transferable subscription right for each share of our common stock that you owned as of 5:00 p.m., Eastern Time, on April 10, 2013, either as a holder of record or, in the case of shares held of record by custodian banks, brokers, dealers or other nominees on your behalf, as a beneficial owner of such shares.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Subscription Price</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">$1.50 per share.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Record Date</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">5:00 p.m., Eastern Time, on April 10, 2013.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Expiration of the Rights Offering</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="padding-bottom:8px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">5:00 p.m., Eastern Time, on </font><font style="font-family:inherit;font-size:10pt;">_________</font><font style="font-family:inherit;font-size:10pt;">, 2013.  We may extend the rights offering without notice to you until </font><font style="font-family:inherit;font-size:10pt;">_________</font><font style="font-family:inherit;font-size:10pt;">, 2013.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Use of Proceeds</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="padding-bottom:8px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We expect the aggregate net proceeds from the rights offering to be approximately</font><font style="font-family:inherit;font-size:10pt;">&#160;$4.475 </font><font style="font-family:inherit;font-size:10pt;">million.  We intend to use the proceeds of the rights offering to supplement the capital of First Security and for general corporate purposes.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Basic Subscription Privilege</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The basic subscription privilege of each subscription right entitles you to purchase two shares of our common stock at a subscription price of $1.50 per share.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Over-Subscription Privilege</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In the event that you purchase all of the shares of our common stock available to you pursuant to your basic subscription privilege, you may also choose to subscribe for a portion of any shares of our common stock that are not purchased by our other shareholders through the exercise of their basic subscription privileges. You may subscribe for shares of common stock pursuant to your over-subscription privilege, subject to the purchase and ownership limitations described below under the heading &#8220;Limitations on the Purchase of Shares.&#8221;</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Limitations on the Purchase of Shares</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="padding-bottom:8px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Subject to the discretion of our board of directors, a person, together with certain related persons and associates, may not purchase a number of shares such that upon completion of the rights offering the person owns securities representing in excess of 4.9% of our common stock.  Additionally, federal law generally requires prior regulatory approval for any person or persons acting in concert to acquire 10% or more of our common stock.  We will not issue shares of our common stock pursuant to the exercise of basic subscription rights or over-subscription rights, or to any person or entity who, in our sole opinion, could be required to obtain prior clearance or approval from or submit a notice to any state or federal bank regulatory authority to acquire, own or control such shares if, as of </font><font style="font-family:inherit;font-size:10pt;">___________</font><font style="font-family:inherit;font-size:10pt;">, 2013, we determine that such clearance or approval has not been obtained and/or any applicable waiting period has not expired.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Non-Transferability of Rights</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The subscription rights may not be sold, transferred or assigned and will not be traded on the NASDAQ Capital Market or on any other stock exchange or market.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">No Board Recommendation</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Our board of directors is making no recommendation regarding the exercise of your subscription rights.  You are urged to make your decision based on your own assessment of our business and the rights offering.  Please see the &#8220;Risk Factors&#8221; section in this prospectus, the information incorporated by reference herein and contained in the section entitled "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2012 and any risk described in our other filings with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act for a discussion of some of the risks involved in investing in our common stock.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Revocation</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Except with regard to rights issued to accounts in the 401(k) Plan, all exercises of subscription rights are irrevocable, even if you later learn of information that you consider to be unfavorable to the exercise of your subscription rights.  You should not exercise your subscription rights unless you are certain that you wish to purchase additional shares of our common stock in the rights offering at a subscription price of $1.50 per share.  Note, however, that rights issued to accounts in the 401(k) Plan will not be exercised if the market price of our common stock is below a $1.50 on the date the common stock is to be purchased.</font></div></td></tr></table></div></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">13</font></div></div><hr style="page-break-after:always"><a name="s0E51DAB27644EC98C7C68B32D428244B"></a><div></div><br><div style="line-height:120%;font-size:10pt;"><div style="padding-left:0px;text-indent:0px;line-height:normal;padding-top:10px;"><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman;font-size:10pt;width:100%;border-collapse:collapse;text-align:left;"><tr><td colspan="2"></td></tr><tr><td width="30%"></td><td width="70%"></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Purchase Intentions of Our Directors and Officers</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Our directors and executive officers collectively hold rights to purchase 109,038 shares of our common stock in the rights offering.  Certain of our directors and executive officers have indicated an interest in participating in the rights offering.  Collectively, we expect our directors and executive officers to purchase approximately </font><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font><font style="font-family:inherit;font-size:10pt;">&#160;shares of our common stock in the rights offering.  Our directors and executive officers are entitled to participate in the rights offering on the same terms and conditions applicable to all other Pre-Recapitalization Shareholders.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Maximum Offering</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The rights offering is subject to a limit of 3,329,234 shares of common stock.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Material U.S. Federal Income Tax Considerations</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">For U.S. federal income tax purposes, you should not recognize income or loss upon the receipt, exercise or lapse of the subscription rights.  You should consult your own tax advisor as to the tax consequences to you of the receipt, exercise or lapse of the subscription rights in light of your particular circumstances.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Extension and Cancellation</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="padding-bottom:8px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Although we do not presently intend to do so, we have the option to extend the rights offering expiration date, but in no event will we extend the rights offering beyond </font><font style="font-family:inherit;font-size:10pt;">___________, 201</font><font style="font-family:inherit;font-size:10pt;">3.  Our board of directors may cancel the rights offering at any time.  In the event that the rights offering is cancelled, all subscription payments received by the subscription agent will be promptly returned, without interest.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Dealer Manager</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Raymond James &amp; Associates, Inc.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Shares Outstanding Before the Rights Offering</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="padding-bottom:8px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">62,428,367 shares of our common stock were outstanding as of</font><font style="font-family:inherit;font-size:10pt;">&#160;June 15, </font><font style="font-family:inherit;font-size:10pt;">2013.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Shares Outstanding After Completion of the Rights Offering</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Assuming no options are exercised prior to the expiration of the rights offering and assuming all 3,329,234 shares of common stock are sold in the rights offering, we expect 65,752,601 shares of our common stock will be outstanding immediately after completion of the rights offering.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Trading Symbol</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Shares of our common stock are currently traded on the NASDAQ Capital Market under the symbol &#8220;FSGI.&#8221;</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Risk Factors</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:8px;padding-right:2px;"><div style="padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Before you exercise your subscription rights to purchase shares of our common stock, you should be aware that there are risks associated with your investment, including the risks described in the section entitled &#8220;Risk Factors&#8221; of this prospectus, the risks that we have highlighted in other sections of this prospectus, the information incorporated by reference herein and contained in the section entitled "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2012 and any risks described in our other filings with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act. You should carefully read and consider these risk factors together with all of the other information included in this prospectus before you decide to exercise your subscription rights to purchase shares of our common stock.</font></div></td></tr></table></div></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">14</font></div></div><hr style="page-break-after:always"><a name="s2C41F9BBB68ADA23967E8B32D4865FAD"></a><div></div><br><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><a name="s71F7573642E42673268F8B32D4B56446"></a><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">RISK FACTORS</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">An investment in our common stock involves a high degree of risk. Before you purchase shares of our common stock, you should carefully consider the risks described below, together with the other information contained or incorporated by reference into this prospectus, including the information contained in the section entitled &#8220;Risk Factors&#8221; in our Annual Report on Form 10-K for the year ended December 31, 2012 and any risks described in our other filings with the SEC, pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act, before making a decision to invest in our common stock. The risks described below and in the documents referred to in the preceding sentence are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially and adversely affect our business operations. If any of the following risks actually occurs, our business, results of operations and financial condition could suffer. In that case, the trading price of our common stock and the values of any of our other securities could decline, and you may lose all or part of your investment. </font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Risks Related to the Rights Offering</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">The market price of our common stock is volatile and the future price of the shares of our common stock may be less than the $1.50 purchase price per share in the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you exercise your subscription rights to purchase shares of common stock in the rights offering, you may not be able to sell them later at or above the $1.50 purchase price in the rights offering.  The actual market price of our common stock could be subject to wide fluctuations in response to numerous factors, some of which are beyond our control.  These factors include, among other things, actual or anticipated variations in our costs of doing business, operating results and cash flow, the nature and content of our earnings releases and our competitors&#8217; earnings releases, changes in financial estimates by securities analysts, business conditions in our markets and the general state of the securities markets and the market for other financial stocks, changes in capital markets that affect the perceived availability of capital to companies in our industry, governmental legislation or regulation, currency and exchange rate fluctuations, as well as general economic and market conditions, such as downturns in our economy and recessions.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">All exercises of subscription rights are irrevocable, even if you learn information about us that you consider to be unfavorable or the market price of our common stock declines below the subscription price you have paid.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Other than with respect to subscription rights issued to accounts in the 401(k) Plan, once you exercise your subscription rights, you may not revoke them, even if you learn information about us that you consider to be unfavorable.  If you exercise your subscription rights and, afterwards, the public trading market price of our shares of common stock decreases below the subscription price, you will have committed to buying shares of our common stock at a price above the prevailing market price and could have an immediate unrealized loss.  Our common stock is traded on the NASDAQ Capital Market under the ticker symbol &#8220;FSGI,&#8221; and the last reported sales price of our common stock on the NASDAQ Capital Market on July 2, 2013 was $2.16 per share.  We cannot assure you that the market price of shares of our common stock will not decline after you exercise your subscription rights.  Moreover, we cannot assure you that following the exercise of your subscription rights you will be able to sell your common stock at a price equal to or greater than the subscription price.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">The subscription price determined for the rights offering is not an indication of the fair value of our common stock.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">As required by the Stock Purchase Agreement, we are conducting this rights offering to provide our Pre-Recapitalization Shareholders with the opportunity to purchase up to 3,329,234 shares of our common stock at a purchase price per share of $1.50, the same price per share paid by investors in the Recapitalization.  The per share subscription price is not necessarily related to our book value, net worth or any other established criteria of fair value and may or may not be considered the fair value of our common stock to be offered in the rights offering.  After the date of this prospectus, our shares of common stock may trade at prices below the subscription price.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Shareholders may face dilution as a result of the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Other than shareholders who purchase sufficient shares of our common stock in the rights offering to maintain their proportionate ownership interest, the issuance of shares of our common stock in the rights offering will dilute, and thereby reduce, each existing shareholder&#8217;s proportionate ownership interest in shares of our </font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">15</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">common stock.  The dilutive effect of the rights offering may have an adverse impact on the market price of our common stock.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">We may, in our sole discretion, terminate the rights offering at any time prior to the expiration of the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We may, in our sole discretion, terminate the rights offering at any time prior to the expiration of the rights offering.  If we terminate the rights offering, neither we nor the dealer manager and the subscription agent will have any obligation to you with respect to the subscription rights except to return any exercise payment received by the subscription agent, without interest or penalty.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">You will not be able to sell the shares you buy in the rights offering until you receive your stock certificates or your account is credited with the shares of common stock.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you purchase shares of our common stock in the rights offering by submitting a rights certificate and payment, we will mail you a stock certificate as soon as practicable after the expiration of the rights offering, on </font><font style="font-family:inherit;font-size:10pt;">___________,</font><font style="font-family:inherit;font-size:10pt;">&#32;2013, or such later date as to which the rights offering may be extended.  If your shares are held by a custodian bank, broker, dealer or other nominee or are held in the 401(k) Plan and you purchase shares of our common stock, your account with your nominee or the 401(k) Plan will be credited with the shares of common stock you purchased in the rights offering as soon as practicable after the expiration of the rights offering, or such later date as to which the rights offering may be extended.  Until your stock certificates have been delivered or your account is credited, you may not be able to sell your shares even though the common stock issued in the rights offering will be traded on the NASDAQ Capital Market.  The stock price may decline between the time you decide to sell your shares and the time you are actually able to sell your shares.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Our common stock has substantially less liquidity than other publicly traded companies.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Our common stock has substantially less liquidity than other publicly traded companies.  A public trading market having the desired characteristics of depth, liquidity and orderliness depends on the presence in the marketplace of willing buyers and sellers of our common stock at any given time.  This marketplace depends on the individual decisions of investors and general economic and market conditions over which we have no control.  This limited market may affect your ability to sell your shares on short notice, and the sale of a large number of shares at one time could temporarily depress the market price of our common stock.  For these reasons, our common stock should not be viewed as a short-term investment.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The market price of our common stock may fluctuate in the future, and this volatility may be unrelated to our performance. General market price declines or overall market swings in the future could adversely affect the price of our common stock, and the current market price may not be indicative of future market prices.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">We have broad discretion in the use of proceeds of the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We have not designated the anticipated net proceeds of the rights offering for specific uses.  Accordingly, our management will have considerable discretion in the application of the net proceeds of the rights offering and you will not have the opportunity, as part of your investment decision, to assess whether the proceeds are being used appropriately or effectively.  Management&#8217;s failure to utilize the proceeds effectively could have an adverse effect on our business, financial condition and results of operations.  See &#8220;Use of Proceeds.&#8221;  </font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Significant sales of our common stock from the Recapitalization or this rights offering, or the perception that significant sales may occur in the future, could adversely affect the market price for our common stock. </font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font></div><div style="line-height:120%;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The sale of substantial amounts of our common stock could adversely affect the price of our common stock. Sales of substantial amounts of our common stock in the public market, and the availability of shares for future sale could cause the market price of our common stock to decline and remain low for a substantial amount of time. Pursuant to the Stock Purchase Agreement, 60,735,000 shares of our common stock sold in the Recapitalization have been registered for resale on a registration statement on Form S-1 (File No. 333-188137</font><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">)</font><font style="font-family:inherit;font-size:10pt;">&#32;that was declared effective by the SEC on June 6, 2013. The investors in our Recapitalization are no longer subject to any lock-up agreements or any other contractual agreements not to dispose of our shares. Any disposition by the investors in our Recapitalization, or any of our substantial shareholders, of our common stock in the public market, or the perception that such dispositions could occur, will likely adversely affect prevailing market prices of our common stock, causing a decline in our market price.  We cannot foresee the impact of such potential sales on the market, but it is possible that if a significant percentage of such available shares were attempted to be sold within a short period of time, the market of our shares would be adversely affected.  Even if a substantial number of sales do not occur </font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">16</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">within a short period of time, the mere existence of this "market overhang" could have a negative impact on the market for our common stock and our ability to raise additional capital.</font></div><div style="line-height:120%;padding-top:18px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Your percentage ownership in our common stock may be diluted in the future because of existing equity awards on our common stock, and future capital raising activities. </font></div><div style="line-height:120%;padding-top:6px;text-align:left;text-indent:33px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">As of March 31, 2013, we had outstanding options to purchase 132,196 shares of our common stock at a weighted average exercise price of $24.26 per share. All of these options are held by our directors, executive officers and employees. The issuance of shares following the exercise of options will result in dilution of your ownership of our common stock. In the future, we may issue additional equity securities in order to fund working capital needs, regulatory capital requirements, capital expenditures and product development, or to make acquisitions and other investments, which may dilute your ownership interest. </font></div><div style="line-height:120%;padding-top:18px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">If you do not act promptly and follow the subscription instructions, your exercise of subscription rights may be rejected. </font></div><div style="line-height:120%;padding-top:6px;text-align:left;text-indent:33px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you desire to purchase shares in the rights offering, you must act promptly to ensure that the subscription agent actually receives all required forms and payments before the expiration of the rights offering at 5:00&#160;p.m., Eastern Time, on </font><font style="font-family:inherit;font-size:10pt;">_________,</font><font style="font-family:inherit;font-size:10pt;">&#32;2013, unless we extend the rights offering for additional periods. If you are a beneficial owner of shares, you must act promptly to ensure that your broker, dealer, custodian bank or other nominee holder acts for you and that all required forms and payments are actually received by the subscription agent before the expiration of the rights offering. We are not responsible if your nominee fails to ensure that the subscription agent receives all required forms and payments before the expiration of the rights offering. If you fail to complete and sign the required subscription forms, send an incorrect payment amount, or otherwise fail to follow the subscription procedures that apply to the exercise of your subscription rights prior to the expiration of the rights offering, the subscription agent may reject your subscription or accept it only to the extent of the payment received. Neither we nor our subscription agent undertake any responsibility to contact you concerning an incomplete or incorrect subscription form or payment, nor are we under any obligation to correct such forms or payment. We have the sole discretion to determine whether a subscription exercise properly complies with the subscription procedures. </font></div><div style="line-height:120%;padding-top:18px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">We may place a limit on the number of shares of common stock you may purchase if your exercise of subscription rights (including the oversubscription privilege) would result in you owning more than 4.9% of our common stock. </font></div><div style="line-height:120%;padding-top:6px;text-align:left;text-indent:33px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Subject to the discretion of our board of directors, a person, together with certain related persons and associates, may not purchase a number of shares such that upon completion of the rights offering the person owns securities representing in excess of 4.9% of our common stock.  </font></div><div style="line-height:120%;padding-top:6px;text-align:left;text-indent:33px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In addition, we will not issue shares of our common stock pursuant to the exercise of basic subscription rights or over-subscription rights, to any person or entity who, in our sole opinion, could be required to obtain prior clearance or approval from or submit a notice to any state or federal bank regulatory authority to acquire, own or control such shares if, as of the expiration date of the rights offering, we determine that such clearance or approval has not been obtained and/or any applicable waiting period has not expired.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:33px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In the event that shares are not issued because of either of the above restrictions based on percentage ownership, or the failure to obtain regulatory clearance or approval, the right to acquire such shares will be forfeited and such shares will become available to satisfy oversubscription privileges by other participating shareholders.  You will be asked to certify that you are not in violation of this provision when you exercise your subscription rights, and we will pursue any and all legal remedies available to us against anyone who violates this provision. In addition, violation of this provision may subject you to investigation and sanctions by federal bank regulatory authorities. </font></div><div style="line-height:120%;padding-top:18px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">The subscription rights are not transferable and there is no market for the subscription rights. </font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:33px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">You may not sell, give away or otherwise transfer your subscription rights. The subscription rights are only transferable by operation of law. Because the subscription rights are non-transferable, there is no market or other means for you to directly realize any value associated with your subscription rights.</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">We are currently operating under a Consent Order from the OCC and a Written Agreement from the Federal Reserve, which will impact our operations and generally require significant management attention.</font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">17</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;text-align:left;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">While we continue to make progress on compliance with our regulatory agreements and expect that the completion of our Recapitalization will improve such compliance, we are currently not in compliance with several components of the agreements, including the capital requirements. Our compliance efforts require a significant amount of our management's time and attention. Continuing non-compliance may result in additional restrictions and/or regulatory enforcement actions that may negatively impact our operations and financial condition. </font></div><div style="line-height:120%;text-align:left;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">We are subject to an Order imposed by the OCC that could have a material negative affect on our business, operating flexibility, financial condition and the value of our common stock. In addition, addressing the Order will require significant time and attention from our management team, which may increase our costs, impede the efficiency of our internal business processes and adversely affect our profitability in the near-term.</font></div><div style="line-height:120%;text-align:left;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On April 28, 2010, pursuant to a Stipulation and Consent to the Issuance of a Consent Order,  FSGBank by and through its Board of Directors consented and agreed to the issuance of a Consent Order by the OCC, FSGBank's primary regulator. FSGBank and the OCC agreed as to the areas of  FSGBank's operations that warranted improvement and to a plan for making those improvements. The Order requires FSGBank to develop and submit written strategic and capital plans covering at least a three-year period. FSGBank is required to review and revise various policies and procedures, including those associated with concentration management, the allowance for loan and lease losses, liquidity management, criticized asset, loan review and credit.</font></div><div style="line-height:120%;text-align:left;text-indent:29px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;text-indent:29px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">While the Company has taken, and intends to continue to take, such actions as may be necessary to enable FSGBank to comply with the requirements of the Order, there can be no assurance that  FSGBank will be able to comply fully with the provisions of the Order, or that efforts to comply with the Order, particularly the limitations on interest rates offered by FSGBank, will not have adverse effects on the operations and financial condition of the Company and FSGBank.</font></div><div style="line-height:120%;text-align:left;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We are currently deemed not in compliance with several provisions of the Order, including the capital requirements. However, management believes that the completed Recapitalization will improve FSGBank's compliance with the requirements of the Order. Any material noncompliance could result in further enforcement actions by the OCC, including the OCC requiring that FSGBank develop a plan to sell, merge or liquidate. We can provide no assurances that we will be able to comply fully with the Order, that efforts to comply with the Order will not have a material adverse effect on the operations and financial condition of FSGBank, or that further enforcement actions will not be imposed on FSGBank.</font></div><div style="line-height:120%;text-align:left;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">FSGBank is not currently in compliance with the capital requirements contained in the Order, which could adversely affect our financial condition and our results of operations.</font></div><div style="line-height:120%;text-align:left;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Order requires FSGBank to, within 120 days of the effective date of the Order, achieve and thereafter maintain total capital at least equal to 13.0% of risk-weighted assets and Tier 1 capital at least equal to 9.0% of adjusted total assets. Following the Recapitalization, on April 23, 2013, FSGBank filed a cash contribution to capital notice with the OCC certifying a $65.0 million capital contribution by the Company into FSGBank.  With that capital contribution, FSGBank's pro forma regulatory capital ratios increased substantially.  As of March 31, 2013, all pro forma regulatory capital measures exceeded the percentages of a well-capitalized institution as defined under applicable regulatory guidelines; however, FSGBank's Tier 1 leverage ratio continues to be below the 9.0% required in the Order.  FSGBank will continue to be classified as adequately capitalized due to the capital requirements in the Order. </font></div><div style="line-height:120%;text-align:left;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">We are subject to an Agreement with the Federal Reserve that could have a material negative effect on our business, operating flexibility, financial condition and the value of our common stock.</font></div><div style="line-height:120%;text-align:left;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On September 7, 2010, the Company entered into an Agreement with the Federal Reserve. The Agreement places restrictions on the Company that are designed to enhance the Company's ability to act as a source of strength to FSGBank. Pursuant to the Agreement, the Company is prohibited from declaring or paying dividends without prior written consent from the Federal Reserve. In addition, pursuant to the Agreement, without the prior written consent of regulators, the Company is prohibited from taking dividends, or any other form of payment representing a reduction of capital, from FSGBank; incurring, increasing or guaranteeing any debt; or redeeming any shares of the Company's common stock. The Company will also provide quarterly written progress reports to the Federal Reserve. </font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">18</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Company was also required to submit to the Federal Reserve a written plan designed to maintain sufficient capital at the Company, on a consolidated basis, and at FSGBank.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#32;The Company submitted a copy of FSGBank&#8217;s capital plan that had previously been submitted to FSGBank&#8217;s primary regulator, the OCC.  During May 2013, the OCC requested updated capital and strategic plans based on the Recapitalization.  On July 1, 2013, FSGBank submitted capital and strategic plans to the OCC.  The plans were also submitted to the Federal Reserve by the Company.  We can give no assurance that the Federal Reserve or the OCC will approve our capital and strategic plans.</font></div><div style="line-height:120%;text-align:left;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Although management believes the successful execution of the Recapitalization will improve our compliance with the Agreement and ultimately position the Company for long-term growth and a return to profitability, the Company is currently deemed not in compliance with provisions of the Agreement. Any material noncompliance may result in further enforcement actions by the Federal Reserve.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">19</font></div></div><hr style="page-break-after:always"><a name="s146218D49E9460CD439E8B32D4D479A4"></a><div></div><br><div style="line-height:120%;padding-bottom:8px;text-align:center;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">SUMMARY OF THE RECAPITALIZATION</font></div><div style="line-height:120%;text-align:left;text-indent:46px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On February 25, 2013, the Company entered into a number of agreements in connection with its $91.1 million Recapitalization, including the Stock Purchase Agreement.  Those agreements required the Company to issue and sell, in a Private Placement, 60,735,000 shares of common stock at the Purchase Price of $1.50 per share.  The closing of the Private Placement took place over two days, with the issuance of 9,941,908 shares of common stock to Treasury in exchange for 33,000 shares of the Company&#8217;s TARP Preferred Stock, the TARP Warrant to purchase 82,363 shares of common stock, and all accrued but unpaid dividends on the TARP Preferred Stock, and the sale by Treasury of such shares of common stock to investors occurring on the TARP Closing Date of April 11, 2013, and the sale of 50,793,092 shares of common stock directly to investors occurring on the Investor Closing Date, April 12, 2013.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">TARP Exchange </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On February 25, 2013, the Company entered into an Exchange Agreement with Treasury, which held 33,000 shares of the TARP Preferred Stock and the TARP Warrant.  The Exchange Agreement required Treasury to exchange the TARP Preferred Stock and the TARP Warrant for a number of shares of common stock (the &#8220;Converted Shares&#8221;) that, based on a price per share equal to the Purchase Price, represented a discount of 73.25% of the aggregate liquidation amount of the TARP Preferred Stock plus 100% of the accrued but unpaid dividends thereon through the TARP Closing Date (collectively, the &#8220;TARP Exchange&#8221;).  Accordingly, on April 11, 2013, the Company issued 9,941,908 shares of common stock to the Treasury.  Immediately following the issuance of the Converted Shares to Treasury, Treasury sold the Converted Shares to certain investors identified by the Company at the Purchase Price pursuant to TARP Securities Purchase Agreements (the &#8220;Securities Purchase Agreements&#8221;) between such investors, Treasury and the Company in private placement transactions exempt from registration under the Securities Act.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Stock Purchase Agreement </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On February 25, 2013, the Company entered into a Stock Purchase Agreement (the &#8220;Stock Purchase Agreement&#8221;) with certain institutional investors, including affiliates of EJF Capital LLC (&#8220;EJF&#8221;), GF Financial II, LLC (&#8220;GF Financial&#8221;), MFP Partners, L.P. (&#8220;MFP&#8221;), Ulysses Partners, L.P. (&#8220;Ulysses&#8221;), and the other investors named therein (collectively, the &#8220;Investors&#8221;), whereby EJF, GF Financial, MFP and Ulysses each agreed to purchase approximately $9.0 million of common stock at the Purchase Price.  The Stock Purchase Agreement provided that the Company could direct each Investor to purchase all or part of such Investor's committed investment from Treasury.  Investors purchased shares remaining from their committed investment directly from the Company.  </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Pursuant to the Stock Purchase Agreement, 60,735,000 shares of our common stock sold in the Recapitalization have been registered for resale on a registration statement on Form S-1 (File No. 333-188137) that was declared effective by the SEC on June 6, 2013. The investors in our Recapitalization are no longer subject to any lock-up agreements or any other contractual agreements not to dispose of our shares and these shares are freely transferable.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Subscription Agreements </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Other accredited investors (the &#8220;Local Investors&#8221;) executed subscription agreements (&#8220;Subscription Agreements&#8221;), pursuant to which they committed to purchase shares of common stock for the Purchase Price.  The Subscription Agreements provided that the Company could direct each Local Investor to purchase all or a portion of such Local Investor's committed investment from Treasury.  </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In aggregate, the Investors and Local Investors agreed to purchase approximately $91.1 million of common stock at $1.50 per share.  Accordingly, Investors and Local Investors purchased 9,941,908 shares from Treasury on April 11, 2013, and, on April 12, 2013, the Company sold 50,793,092 shares of common stock to the Investors and the Local Investors.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Gross-Up Rights </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Stock Purchase Agreement provides that each Investor acquiring 5.0% or more of the Company's outstanding common stock will hold gross-up rights by which they may purchase sufficient securities as to maintain their ownership percentage of the Company.  Any offering of securities by the Company that is not contemplated by the Stock Purchase Agreement will trigger these rights, and any purchase of securities by such Investors will be on the same or similar terms as those offered to other investors.  The gross-up rights terminate with respect to each Investor once such Investor no longer owns 5.0% or more of the Company's outstanding common stock.  As </font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">20</font></div></div><hr style="page-break-after:always"><a name="s146218D49E9460CD439E8B32D4D479A4"></a><div></div><br><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">provided in the Stock Purchase Agreement, the gross-up rights will not be triggered by the rights offering contemplated by this prospectus.  </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Changes to the Board of Directors </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Pursuant to the Stock Purchase Agreement, MFP and Ulysses each designated an individual to serve as a director of the Company.  Accordingly, the Company has appointed the two designated directors to the Board.  The Company has agreed to continue to nominate the designated directors so long as the respective institutions retain ownership of at least 50% of their acquired shares. </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Stock Purchase Agreement also provides that each Investor that beneficially owns at least 5.0% of the Company's outstanding common stock may designate an individual to attend meetings of the Board of Directors as a non-voting observer (the &#8220;Observer&#8221;).  The right of each Investor to appoint an Observer terminates once such Investor no longer owns 5.0% or more of the Company's outstanding common stock. </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The foregoing summary of the documents relating to the Recapitalization are not complete and are qualified in their entirely by reference to the full text of such documents, copies of which are included as exhibits to the Company&#8217;s Current Report on Form 8-K filed on February 26, 2013 and are incorporated by reference herein.   See &#8220;Where You Can Find More Information&#8221; and &#8220;Incorporation of Certain Information by Reference.&#8221;</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">USE OF PROCEEDS</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The total proceeds to us from the rights offering will depend on the number of subscription rights that are exercised.  If we issue all 3,329,234 shares of common stock available in the rights offering, the total gross proceeds to us, before dealer management fees and expenses, will be approximately $5.0 million.  We estimate that the dealer manager fees will be approximatel</font><font style="font-family:inherit;font-size:10pt;">y $300,000 and the other expenses of the rights offering will be approximately $225,000, resulting in estimated net proceeds to us, assuming that all of the shares available in the rights offering are sold, of approximately $4.475 mill</font><font style="font-family:inherit;font-size:10pt;">ion.  The net proceeds may vary since total expenses of the rights offering may be more or less than those estimated and since the number of shares sold may be less than estimated. We intend to use the net proceeds from the rights offering to supplement the capital of First Security and for general corporate purposes.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Because there is no minimum number of shares that must be sold in the rights offering, we can provide no assurance regarding the amount of capital we will actually raise in the rights offering.</font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">21</font></div></div><hr style="page-break-after:always"><a name="sE6414AF4FB9B623755C68B32D5033D2B"></a><div></div><br><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">CAPITALIZATION</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The following table sets forth our capitalization and regulatory capital ratios at March 31, 2013 and as adjusted to reflect: (1) the completion of the Recapitalization and (2) the sale of the maximum 3,329,234 shares of our common stock at the subscription price of $1.50 per share and the receipt of the net proceeds from the rights offering after deducting estimated dealer manager fees of approxim</font><font style="font-family:inherit;font-size:10pt;">ately $300,000 and other offering expenses in the amount of $225,000.  The table does not reflect the use of p</font><font style="font-family:inherit;font-size:10pt;">roceeds from the Recapitalization or the rights offering.  The information presented in the table below should be read in conjunction with the consolidated financial statements and notes thereto incorporated by reference into this prospectus.</font><div style="padding-left:0px;text-indent:0px;line-height:normal;padding-top:10px;"><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman;font-size:10pt;width:100%;border-collapse:collapse;text-align:left;"><tr><td colspan="12"></td></tr><tr><td width="47%"></td><td width="1%"></td><td width="13%"></td><td width="1%"></td><td width="1%"></td><td width="1%"></td><td width="15%"></td><td width="1%"></td><td width="1%"></td><td width="1%"></td><td width="17%"></td><td width="1%"></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="3" style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:9pt;text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-weight:bold;">Actual as of March 31, 2013</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="3" style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:9pt;text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-weight:bold;">As Adjusted for the Recapitalization</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="3" style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:9pt;text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-weight:bold;">As Further Adjusted for Rights Offering</font><font style="font-family:inherit;font-size:9pt;font-weight:bold;"><sup style="vertical-align:top;line-height:120%;font-size:6pt">1</sup></font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="11" style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;border-top:1px solid #000000;"><div style="text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">(in thousands, except per share information)</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-weight:bold;">Shareholders&#8217; Equity</font></div></td><td colspan="3" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="3" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="3" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="3" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="3" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="3" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:9pt;text-align:left;padding-left:12px;text-indent:-12px;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Preferred Stock &#8211; no par value &#8211; 10,000,000 shares authorized; 33,000 issued as of March 31, 2013; Liquidation value of $38,569 as of March 31, 2013</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">$</font></div></td><td style="vertical-align:bottom;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">32,660</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">$</font></div></td><td style="vertical-align:bottom;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">&#8212;</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">$</font></div></td><td style="vertical-align:bottom;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">&#8212;</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;padding-left:12px;text-indent:-12px;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Common Stock &#8211; $.01 par value &#8211; 150,000,000 shares authorized; 1,772,342 shares issued as of March 31, 2013</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">115</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">722</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">755</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;padding-left:12px;text-indent:-12px;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Paid-in surplus</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">106,622</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">192,027</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">196,469</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;padding-left:12px;text-indent:-12px;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Common stock warrants</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">2,006</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">&#8212;</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">&#8212;</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;padding-left:12px;text-indent:-12px;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Accumulated deficit</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">(123,293</font></div></td><td style="vertical-align:bottom;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">)</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">(97,565</font></div></td><td style="vertical-align:bottom;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">)</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">(97,565</font></div></td><td style="vertical-align:bottom;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">)</font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;padding-left:12px;text-indent:-12px;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Accumulated other comprehensive income</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">2,884</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">2,884</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">2,884</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Total shareholders&#8217; equity</font></div></td><td style="vertical-align:top;border-bottom:3px double #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;border-top:1px solid #000000;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">$</font></div></td><td style="vertical-align:top;border-bottom:3px double #000000;padding-top:2px;padding-bottom:2px;border-top:1px solid #000000;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">20,994</font></div></td><td style="vertical-align:bottom;border-bottom:3px double #000000;border-top:1px solid #000000;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;border-bottom:3px double #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;border-top:1px solid #000000;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">$</font></div></td><td style="vertical-align:bottom;border-bottom:3px double #000000;padding-top:2px;padding-bottom:2px;border-top:1px solid #000000;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">98,068</font></div></td><td style="vertical-align:bottom;border-bottom:3px double #000000;border-top:1px solid #000000;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;border-bottom:3px double #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;border-top:1px solid #000000;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">$</font></div></td><td style="vertical-align:bottom;border-bottom:3px double #000000;padding-top:2px;padding-bottom:2px;border-top:1px solid #000000;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">102,543</font></div></td><td style="vertical-align:bottom;border-bottom:3px double #000000;border-top:1px solid #000000;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:9pt;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Number of common shares outstanding</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">1,772</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">62,423</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">65,753</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td></tr><tr><td style="vertical-align:top;border-bottom:1px solid #000000;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Book value per share</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">$</font></div></td><td style="vertical-align:bottom;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">11.85</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">$</font></div></td><td style="vertical-align:bottom;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">1.57</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">$</font></div></td><td style="vertical-align:bottom;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">1.56</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td></tr><tr><td colspan="12" style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:8pt;text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;"><sup style="vertical-align:top;line-height:120%;font-size:5pt">1</sup></font><font style="font-family:inherit;font-size:8pt;">&#160;Assumes that all shares available in the rights offering are sold.</font></div></td></tr></table></div></div><div style="line-height:120%;text-align:center;font-size:10pt;"><div style="padding-left:0px;text-indent:0px;line-height:normal;padding-top:10px;"><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman;font-size:10pt;margin-left:auto;margin-right:auto;width:100%;border-collapse:collapse;text-align:left;"><tr><td colspan="13"></td></tr><tr><td width="25%"></td><td width="10%"></td><td width="1%"></td><td width="3%"></td><td width="15%"></td><td width="1%"></td><td width="3%"></td><td width="10%"></td><td width="1%"></td><td width="10%"></td><td width="1%"></td><td width="19%"></td><td width="1%"></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-weight:bold;">March 31, 2013</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-weight:bold;">Estimated Impact of Recapitalization</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:9pt;text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-weight:bold;">Estimated Impact of Rights Offering</font><font style="font-family:inherit;font-size:9pt;font-weight:bold;"><sup style="vertical-align:top;line-height:120%;font-size:6pt">1</sup></font></div></td><td colspan="2" style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:9pt;text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-weight:bold;">Pro-forma</font><font style="font-family:inherit;font-size:9pt;font-weight:bold;"><sup style="vertical-align:top;line-height:120%;font-size:6pt">2</sup></font></div></td><td colspan="2" style="vertical-align:bottom;border-bottom:1px solid #000000;padding-top:2px;padding-bottom:2px;"><div style="font-size:9pt;text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-weight:bold;">Minimum to be Well Capitalized under Prompt Corrective Action Provisions</font><font style="font-family:inherit;font-size:9pt;font-weight:bold;"><sup style="vertical-align:top;line-height:120%;font-size:6pt">3</sup></font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-weight:bold;">Company Capital Levels</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Tier 1 capital</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">17,584</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">77,074</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">4,475</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">99,133</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Total risk-based capital</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">24,967</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">77,074</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">4,475</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">106,516</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Tier 1 leverage capital ratio</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">1.68</font></div></td><td style="vertical-align:top;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">%</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">9.47</font></div></td><td style="vertical-align:top;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">%</font></div></td><td colspan="2" style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">n/a</font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Total risk-based capital ratio</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">4.27</font></div></td><td style="vertical-align:top;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">%</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">18.23</font></div></td><td style="vertical-align:top;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">%</font></div></td><td colspan="2" style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">n/a</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:18px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;font-weight:bold;">FSGBank Capital Levels</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Tier 1 capital</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">19,932</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">65,000</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">4,475</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">89,407</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:bottom;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Total risk-based capital</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">27,313</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">65,000</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">4,475</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">96,788</font></div></td><td style="vertical-align:bottom;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;padding-left:12px;text-indent:-12px;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Tier 1 leverage capital ratio</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">1.90</font></div></td><td style="vertical-align:bottom;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">%</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">8.54</font></div></td><td style="vertical-align:top;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">%</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">5.00</font></div></td><td style="vertical-align:bottom;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">%</font></div></td></tr><tr><td style="vertical-align:top;border-bottom:1px solid #000000;background-color:;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;padding-left:12px;text-indent:-12px;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Total risk-based capital ratio</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">4.68</font></div></td><td style="vertical-align:bottom;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">%</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">16.57</font></div></td><td style="vertical-align:top;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">%</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:right;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">10.00</font></div></td><td style="vertical-align:bottom;padding-right:2px;padding-top:2px;padding-bottom:2px;"><div style="text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">%</font></div></td></tr><tr><td colspan="13" style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:8pt;padding-left:12px;text-indent:-12px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;"><sup style="vertical-align:top;line-height:120%;font-size:5pt">1</sup></font><font style="font-family:inherit;font-size:8pt;">&#160;Assumes that all shares available in the rights offering are sold.</font></div></td></tr><tr><td colspan="13" style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:8pt;padding-left:12px;text-indent:-12px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;"><sup style="vertical-align:top;line-height:120%;font-size:5pt">2</sup></font><font style="font-family:inherit;font-size:8pt;">&#160;Includes both the Estimated Impact of Recapitalization and the Estimated Impact of Rights Offering, assuming that all shares available in the rights offering are sold.</font></div></td></tr><tr><td colspan="13" style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:8pt;padding-left:12px;text-indent:-12px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;"><sup style="vertical-align:top;line-height:120%;font-size:5pt">3</sup></font><font style="font-family:inherit;font-size:8pt;">&#160;FSGBank continues to operate under a Consent Order with heightened capital adequacy requirements.  The Consent Order requires FSGBank to maintain a Tier 1 leverage capital ratio of 9.0% and total risk-based capital ratio of 13.0%.  Accordingly, FSGBank would be considered "adequately capitalized" based on the estimated pro-forma capital levels.</font></div></td></tr></table></div></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">22</font></div></div><hr style="page-break-after:always"><a name="sDE1D210D37F38879C4808B32D52256EB"></a><div></div><br><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">MARKET FOR THE COMMON STOCK AND DIVIDEND INFORMATION</font></div><div style="line-height:120%;padding-bottom:16px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">From August 10, 2005 to March 26, 2013, our common stock traded on the NASDAQ Global Select Market under the symbol FSGI.  As previously disclosed, we were not in compliance with the continued listing requirements of the NASDAQ Global Select Market and were subject to delisting after March 25, 2013.  As a result, we applied to transfer our listing to the NASDAQ Capital Market.  Our application was granted effective March 26, 2013, subject to certain conditions described in the Current Report on Form 8-K filed March 22, 2013, which is incorporated herein by reference.  On July 2, 2013, there were 670 registered holders of our common stock.  The high and low closing prices per share of our common stock for the periods indicated below were as follows: </font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><div style="padding-left:0px;text-indent:0px;line-height:normal;padding-top:10px;"><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman;font-size:10pt;margin-left:auto;margin-right:auto;width:55.12820512820513%;border-collapse:collapse;text-align:left;"><tr><td colspan="3"></td></tr><tr><td width="66%"></td><td width="17%"></td><td width="17%"></td></tr><tr><td style="vertical-align:middle;border-bottom:1px solid #000000;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:9.5pt;"><font style="font-family:inherit;font-size:9.5pt;font-weight:bold;">Quarter</font></div></td><td style="vertical-align:top;border-bottom:1px solid #000000;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:right;font-size:9.5pt;"><font style="font-family:inherit;font-size:9.5pt;font-weight:bold;">High</font></div></td><td style="vertical-align:top;border-bottom:1px solid #000000;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:right;font-size:9.5pt;"><font style="font-family:inherit;font-size:9.5pt;font-weight:bold;">Low</font></div></td></tr><tr><td style="vertical-align:middle;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;border-top:1px solid #000000;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">2013</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">3rd Quarter (through _____)</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">$ </font><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#160;&#160;&#160;&#160;&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">$ </font><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#160;&#160;&#160;&#160;&#160;</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="padding-bottom:6px;padding-top:6px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">2</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">nd</sup></font><font style="font-family:inherit;font-size:10pt;">&#160;Quarter</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;text-align:right;">6.24</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;text-align:right;">1.96</font></div></td></tr><tr><td style="vertical-align:middle;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">1st Quarter</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">3.44</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">1.60</font></div></td></tr><tr><td style="vertical-align:middle;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">2012</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="padding-bottom:6px;padding-top:6px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">4</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">th</sup></font><font style="font-family:inherit;font-size:10pt;">&#160;Quarter</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">3.04</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">1.30</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="padding-bottom:6px;padding-top:6px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">3</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">rd</sup></font><font style="font-family:inherit;font-size:10pt;">&#160;Quarter</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">3.30</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">2.15</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="padding-bottom:6px;padding-top:6px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">2</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">nd</sup></font><font style="font-family:inherit;font-size:10pt;">&#160;Quarter</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">3.35</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">1.98</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="padding-bottom:6px;padding-top:6px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">1</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">st</sup></font><font style="font-family:inherit;font-size:10pt;">&#160;Quarter</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">3.68</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">2.35</font></div></td></tr><tr><td style="vertical-align:middle;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">2011</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="padding-bottom:6px;padding-top:6px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">4</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">th</sup></font><font style="font-family:inherit;font-size:10pt;">&#160;Quarter</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">3.34</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">1.13</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="padding-bottom:6px;padding-top:6px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">3</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">rd</sup></font><font style="font-family:inherit;font-size:10pt;">&#160;Quarter</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">5.70</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">1.81</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="padding-bottom:6px;padding-top:6px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">2</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">nd</sup></font><font style="font-family:inherit;font-size:10pt;">&#160;Quarter</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">9.10</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">4.61</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="padding-bottom:6px;padding-top:6px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">1</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">st</sup></font><font style="font-family:inherit;font-size:10pt;">&#160;Quarter</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">13.00</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:right;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">8.10</font></div></td></tr></table></div></div><div style="line-height:120%;padding-bottom:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;padding-bottom:16px;text-align:left;text-indent:46px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The closing sale price of our common stock as reported on the NASDAQ Capital Market on July 2, 2013 was $2.16 per share.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">23</font></div></div><hr style="page-break-after:always"><a name="sDE1D210D37F38879C4808B32D52256EB"></a><div></div><br><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><a name="s5F7C456E42B1532FB5F48B32D560139B"></a><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Security Ownership of Certain Beneficial Owners</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The following table indicates, as of June 15, 2013, the number of shares of common stock beneficially owned by each greater than five percent holder of the Company&#8217;s outstanding voting securities, each executive officer and director and all executive officers and directors, as a group.</font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><div style="padding-left:0px;text-indent:0px;line-height:normal;padding-top:10px;"><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman;font-size:10pt;margin-left:auto;margin-right:auto;width:83.76068376068376%;border-collapse:collapse;text-align:left;"><tr><td colspan="4"></td></tr><tr><td width="68%"></td><td width="15%"></td><td width="1%"></td><td width="16%"></td></tr><tr><td style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:7pt;"><font style="font-family:inherit;font-size:7pt;"><br></font></div><div style="font-size:7pt;"><font style="font-family:inherit;font-size:7pt;"><br></font></div><div style="font-size:7pt;"><font style="font-family:inherit;font-size:7pt;"><br></font></div><div style="font-size:7pt;"><font style="font-family:inherit;font-size:7pt;"><br></font></div><div style="padding-bottom:1px;font-size:7.5pt;"><font style="font-family:inherit;font-size:7.5pt;font-weight:bold;">Name of Shareholder</font></div></td><td colspan="2" style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="text-align:center;font-size:7.5pt;"><font style="font-family:inherit;font-size:7.5pt;font-weight:bold;">Number of Shares Owned 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style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:14px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:left;font-size:7.5pt;"><font style="font-family:inherit;font-size:7.5pt;font-weight:bold;">Affiliates of EJF Capital LLC: (3)</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">8267561 Canada, Inc.</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">118,574</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">HHMI VII, LLC</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">282,827</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">EJF Financial Opportunities Master Fund, LP</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">157,938</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">EJF Debt Opportunities Master Fund II, LP</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">2,006,896</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">EJF Debt Opportunities Master Fund, LP</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">2,588,145</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">EJF Financial Services Fund, LP</font></div></td><td style="vertical-align:middle;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">925,620</font></div></td><td style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Subtotal</font></div></td><td style="vertical-align:middle;border-bottom:3px double #000000;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;border-top:1px solid #000000;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">6,080,000</font></div></td><td style="vertical-align:bottom;border-bottom:3px double #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:1px solid #000000;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;border-bottom:3px double #000000;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;border-top:1px solid #000000;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">9.7</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:14px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:14px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:14px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:left;font-size:7.5pt;"><font style="font-family:inherit;font-size:7.5pt;font-weight:bold;">MFP: (4)</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">MFP Partners, LP</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">6,080,000</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">9.7</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:14px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:14px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:14px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:left;font-size:7.5pt;"><font style="font-family:inherit;font-size:7.5pt;font-weight:bold;">GF Financial: (5)</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">GF Financial II, LLC</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">6,080,000</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">9.7</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:14px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:14px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:14px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:left;font-size:7.5pt;"><font style="font-family:inherit;font-size:7.5pt;font-weight:bold;">Affiliates of Ulysses: (6)</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Ulysses Partners, LP</font></div></td><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">5,130,000</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">---</font></div></td></tr><tr><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Ulysses Offshore Fund, Ltd</font></div></td><td style="vertical-align:middle;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">870,000</font></div></td><td style="vertical-align:bottom;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;border-bottom:1px solid #000000;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">---</font></div></td></tr><tr><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Subtotal</font></div></td><td style="vertical-align:middle;border-bottom:3px double 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style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:3px double #000000;"><div style="overflow:hidden;height:14px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;border-top:3px double #000000;"><div style="overflow:hidden;height:14px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:14px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:14px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;height:14px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:middle;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:left;font-size:7.5pt;"><font style="font-family:inherit;font-size:7.5pt;font-weight:bold;">Directors and Executive Officers:</font></div></td><td colspan="2" style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Henchy R. Enden (7)</font></div><div style="padding-bottom:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">&#160;&#160;</font><font style="font-family:inherit;font-size:8pt;font-style:italic;">Director </font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">500</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">*</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">William F. Grant, III (8)</font></div><div style="padding-bottom:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">&#160;&#160;</font><font style="font-family:inherit;font-size:8pt;font-style:italic;">Director </font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">44,309</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">*</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">William C. Hall (9)</font></div><div style="padding-bottom:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">&#160;&#160;</font><font style="font-family:inherit;font-size:8pt;font-style:italic;">Director</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">16,968</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">*</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Adam G. Hurwich (10)</font></div><div style="padding-bottom:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">&#160;&#160;</font><font style="font-family:inherit;font-size:8pt;font-style:italic;">Director</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">1,000</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">*</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Carol H. Jackson (11)</font></div><div style="padding-bottom:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">&#160;&#160;</font><font style="font-family:inherit;font-size:8pt;font-style:italic;">Director</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">63,786</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">*</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Kelly P. Kirkland (12)</font></div><div style="padding-bottom:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">&#160;&#160;</font><font style="font-family:inherit;font-size:8pt;font-style:italic;">Director</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">18,347</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">*</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">D. 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Lane (14)</font></div><div style="padding-bottom:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">&#160;&#160;</font><font style="font-family:inherit;font-size:8pt;font-style:italic;">Director</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">21,950</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">*</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Larry D. Mauldin (15)</font></div><div style="padding-bottom:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-style:italic;">&#160;&#160;Director</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">170,650</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">*</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Denise M. Cobb (16)</font></div><div style="padding-bottom:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">&#160;&#160;</font><font style="font-family:inherit;font-size:8pt;font-style:italic;">Executive Vice President and Chief Administrative Officer</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">24,756</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">*</font></div></td></tr><tr><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">John R. 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Tietz (18)</font></div><div style="padding-bottom:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;font-style:italic;">&#160;&#160;Executive Vice President and Chief Credit Officer</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">90,053</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">*</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="padding-bottom:1px;text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">All directors and officers as a group (19)</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="text-align:right;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">639,942</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="overflow:hidden;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:1px;padding-right:2px;"><div style="padding-bottom:1px;text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">1.0</font></div></td></tr></table></div></div><div style="line-height:100%;text-align:left;padding-left:53px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">24</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:100%;text-align:left;padding-left:53px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:8pt;"><div style="padding-left:0px;text-indent:0px;line-height:normal;padding-top:10px;"><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman;font-size:10pt;margin-left:auto;margin-right:auto;width:84.82905982905983%;border-collapse:collapse;text-align:left;"><tr><td colspan="2"></td></tr><tr><td width="16%"></td><td width="84%"></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:2px;padding-bottom:6px;padding-right:2px;border-top:1px solid #000000;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">*</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Less than one percent of outstanding shares.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(1)</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Some or all of the shares may be subject to margin accounts.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(2)</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="padding-bottom:1px;text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Assumes the full exercise of the subscription rights in the Rights Offering.  The percentage of our common stock beneficially owned was calculated based on 62,428,367 shares of common stock issued and outstanding as of June 15, 2013.  The percentage assumes the exercise by the shareholder or group named in each row of all options for the purchase of our common stock held by such shareholder or group and exercisable within 60 days of June 15, 2013.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(3)</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Each of EJF Debt Opportunities Master Fund, L.P., EJF Debt Opportunities Master Fund II, LP, EJF Financial Services Fund, LP and EJF Financial Opportunities Master Fund, LP is the record owner of the shares indicated.  EJF Debt Opportunities GP, LLC serves as the general partner and investment manager of EJF Debt Opportunities Master Fund, L.P. and may be deemed to share beneficial ownership of the shares of Common Stock of which EJF Debt Opportunities Master Fund, L.P. is the record owner. EJF Debt Opportunities II GP, LLC serves as the general partner and investment manager of EJF Debt Opportunities Master Fund II, LP and may be deemed to share beneficial ownership of the shares of common stock of which EJF Debt Opportunities Master Fund II, LP is the record owner.  EJF Financial Services GP, LLC serves as the general partner and investment manager of EJF Financial Services Fund, LP and may be deemed to share beneficial ownership of the shares of common stock of which EJF Financial Services Fund, LP is the record owner. EJF Financial Opportunities GP, LLC serves as the general partner of EJF Financial Opportunities Master Fund, LP and may be deemed to share beneficial ownership of the shares of common stock of which EJF Financial Opportunities Master Fund, LP is the record owner.  EJF Capital LLC is the sole member and manager of each of EJF Debt Opportunities GP, LLC, EJF Debt Opportunities II GP, LLC, EJF Financial Services GP, LLC and EJF Financial Opportunities GP, LLC, and may be deemed to share beneficial ownership of the shares of common stock of which such entities may share beneficial ownership.  EJF Capital LLC also serves as the investment manager of EJF Financial Opportunities Master Fund, LP and certain managed accounts and consequently may be deemed to share beneficial ownership of the shares held of record by EJF Financial Opportunities Master Fund, LP , 8267561 Canada, Inc. and HHMI VII, LLC. Emanuel J. Friedman is the controlling member of EJF Capital LLC and may be deemed to share beneficial ownership of the shares of common stock over which EJF Capital LLC may share beneficial ownership.  The address of each EJF affiliate is 2107 Wilson Boulevard, Suite 410, Arlington, VA 22201.</font></div><div style="padding-bottom:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;"><br></font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(4)</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">MFP Partners, LP, a Delaware limited partnership (&#8220;MFP&#8221;), is the record holder of the shares indicated.  MFP Investors LLC, a Delaware limited liability company and general partner of MFP (&#8220;MFP Investors&#8221;), and Michael F. Price, managing partner of MFP and the managing member and controlling person of MFP Investors (the &#8220;MFP Reporting Persons&#8221;).  Due to their respective relationships with MFP and each other, each of the MFP Reporting Persons may be deemed to share voting and dispositive power with respect to the shares presented.  The address of the MFP Reporting Persons is 667 Madison Avenue, 25th Floor, New York, New York 10065.</font></div><div style="padding-bottom:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;"><br></font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(5)</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">GF Financial II, LLC a Delaware limited liability company (&#8220;GFF II&#8221;), is the record holder of the shares indicated.  Diaco Investments, L.P., is a Delaware limited partnership and 100% owner of GFF II (&#8220;Diaco&#8221;), Siget, LLC, is a Delaware limited liability company and general partner of Diaco (&#8220;Siget&#8221;), Simon Glick is a managing member of Siget and Seymour Pluchenik is a managing member of Siget.  Each of the foregoing may be deemed to share voting and dispositive power with respect to the shares held by GFF II.  The address of each GFF II affiliate is 810 Seventh Avenue, 28th Floor, New York, New York 10019.</font></div><div style="padding-bottom:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;"><br></font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(6)</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Ulysses Management LLC is a Delaware limited liability company (&#8220;Ulysses Management&#8221;), Ulysses Partners, L.P., is a Delaware limited partnership (&#8220;Ulysses Partners&#8221;), Ulysses Offshore Fund, Ltd, is an exempted company incorporated and existing under the laws of the Cayman Islands (&#8220;Ulysses Offshore&#8221;), Joshua Nash LLC, is a Delaware limited liability company (&#8220;Nash LLC&#8221;), and Joshua Nash is a United States citizen.  Ulysses Management, in its capacity as investment manager, may be deemed to share voting and investment power over the 5,130,000 shares beneficially owned by Ulysses Partners and the 870,000 shares beneficially owned by Ulysses Offshore, Nash LLC, as the managing general partner of Ulysses Partners, may be deemed to share voting and investment power over the 5,130,000 shares beneficially owned by Ulysses Partners, and Mr. Nash, as an executive of Ulysses Management, the sole member of Nash LLC and the President of Ulysses Offshore, may be deemed to share voting and investment power over the 6,000,000 shares beneficially owned by Ulysses Management and the 5,130,000 shares beneficially owned by Ulysses Partners and Ulysses Offshore.  The address of each Ulysses Management affiliate is c/o Ulysses Management LLC, One Rockefeller Plaza, New York, New York  10020.</font></div><div style="padding-bottom:1px;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;"><br></font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(7)</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="padding-bottom:1px;text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">All shares directly owned by Ms. Enden.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(8)</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="padding-bottom:1px;text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Includes 1,650 shares that Mr. Grant has the right to acquire by exercising options that are exercisable within 60 days after June 15, 2013.  All other shares directly owned by Mr. Grant.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(9)</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="padding-bottom:1px;text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Includes 120 shares subject to restricted stock awards and 1,848 shares that Mr. Hall has the right to acquire by exercising options that are exercisable within 60 days after June 15, 2013. All other shares directly owned.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(10)</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="padding-bottom:1px;text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">All shares directly owned by Mr. Hurwich.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(11)</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="padding-bottom:1px;text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Includes 666 shares owned by Ms. Jackson's spouse and 509 shares owned by an IRA for the benefit of Ms. Jackson; also includes 5,370 shares that Ms. Jackson has the right to acquire by exercising options that are exercisable with 60 days after June 15, 2013. All other shares directly owned.</font></div></td></tr></table></div></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">25</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;text-align:center;font-size:8pt;"><div style="padding-left:0px;text-indent:0px;line-height:normal;padding-top:10px;"><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman;font-size:10pt;margin-left:auto;margin-right:auto;width:84.82905982905983%;border-collapse:collapse;text-align:left;"><tr><td colspan="2"></td></tr><tr><td width="16%"></td><td width="84%"></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(12)</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="padding-bottom:1px;text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Includes 1,650 shares that Ms. Kirkland has the right to acquire by exercising options that are exercisable within 60 days after June 15, 2013.  All other shares directly owned by Ms. Kirkland.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(13)</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="padding-bottom:1px;text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Includes 1,452 shares held in First Security's 401(k) plan and also includes 8,750 shares subject to restricted stock awards.  All other shares directly owned.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(14)</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="padding-bottom:1px;text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Includes 1,650 shares that Mr. Lane has the right to acquire by exercising options that are exercisable within 60 days after June 15, 2013.  All other shares directly owned by Mr. Lane.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(15)</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="padding-bottom:1px;text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Includes 10,000 shares subject to restricted stock awards.  Also includes 1,650 shares that Mr. Mauldin has the right to acquire by exercising options that are exercisable within 60 days after June 15, 2013.  All other shares directly owned by Mr. Mauldin.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(16)</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="padding-bottom:1px;text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Includes 1,706 shares held in First Security's 401(k) plan and also includes 2,500 shares subject to restricted stock awards.  Additionally, Ms. Cobb has the right to acquire 550 shares by exercising options that are exercisable within 60 days after June 15, 2013. All other shares directly owned.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(17)</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="padding-bottom:1px;text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Includes 1,716 shares held in First Security's 401(k) plan and also includes 2,500 shares subject to restricted stock awards. Additionally, Mr. Haddock has the right to acquire 805 shares by exercising options that are exercisable within 60 days after June 15, 2013. All other shares directly owned.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(18)</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="padding-bottom:1px;text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Includes 1,634 shares owned by a trust controlled by Mr. Tietz and also includes 7,500 shares subject to restricted stock awards. All other shares directly owned.</font></div></td></tr><tr><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="text-align:center;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">(19)</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:1px;padding-right:2px;"><div style="padding-bottom:1px;text-align:left;font-size:8pt;"><font style="font-family:inherit;font-size:8pt;">Includes 15,173 shares that the owner has the right to acquire by exercising options that are exercisable within 60 days after June 15, 2013.</font></div></td></tr></table></div></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;"><br></font></div><div style="line-height:120%;padding-bottom:8px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">SUBSCRIPTIONS BY DIRECTORS AND EXECUTIVE OFFICERS</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">As of April 10, 2013, our current directors and executive officers owned approximately 142,019 shares of our common stock.  Due to the number of outstanding shares of our common stock as of the record date of the rights offering, in order to facilitate the Company&#8217;s compliance with the $5,000,000 maximum rights offering amount imposed by the Stock Purchase Agreement and still offer each Pre-Recapitalization Shareholder the right to purchase two shares of our common stock, five of the Company&#8217;s directors and executive officers holding an aggregate of 23,750 shares on the record date have waived their right to participate in the rights offering.  In addition, 63,750 of the shares of restricted stock owned by directors and executive officers as of the record date were forfeited and are not eligible to participate in the rights offering.  As a result, our directors and executive officers collectively hold rights to purchase 109,038 shares of our common stock in the rights offering.  Certain of our directors and executive officers have indicated an interest in participating in the rights offering.  Collectively, we expect our directors and executive officers to purchase approximately </font><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#160;&#160;&#160;&#160;</font><font style="font-family:inherit;font-size:10pt;">&#32;shares of our common stock in the rights offering, subject to change.  Our directors and executive officers are entitled to participate in the rights offering on the same terms and conditions applicable to all other Pre-Recapitalization Shareholders.  Following the rights offering, our current directors and executive officers, to</font><font style="font-family:inherit;font-size:10pt;">gether with their affiliates, are expected to beneficially own </font><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font><font style="font-family:inherit;font-size:10pt;">&#32;shares of common stock, or approximately </font><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#32;&#32;&#32;&#32;</font><font style="font-family:inherit;font-size:10pt;">% of o</font><font style="font-family:inherit;font-size:10pt;">ur outstanding common stock, assuming that all shares are subscribed for in the rights offering and that no directors, executive officers or their affiliates participate in the oversubscription aspect of the rights offering.  See &#8220;Security Ownership of Certain Beneficial Owners And Management.&#8221;</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">26</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;padding-bottom:8px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">THE RIGHTS OFFERING</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Subscription Rights</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We are distributing to the holders of shares of our common stock as of April 10, 2013, the record date, non-transferable subscription rights to purchase shares of our common stock at $1.50 per share.  The subscription rights entitle the holders of our common stock to purchase up to an aggregate of approximately 3,329,234 shares of our common stock for an aggregate purchase price of approximately $5.0 million.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Each holder of record of our common stock will receive one subscription right for each share of our common stock owned by such holder as of 5:00 p.m., Eastern Time, on April 10, 2013.  Each subscription right entitles the holder to a basic subscription privilege and an over-subscription privilege.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Basic Subscription Privilege.</font><font style="font-family:inherit;font-size:10pt;">&#32;&#32;With your basic subscription privilege, you may purchase two shares of our common stock for each share of common stock that you owned as of the record date, subject to delivery of the required documents and payment of the subscription price of $1.50 per share prior to the expiration of the rights offering.  You may exercise all or a portion of your basic subscription privilege. However, if you exercise less than your full basic subscription privilege, you will not be entitled to purchase shares under your over-subscription privilege.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Over-Subscription Privilege.</font><font style="font-family:inherit;font-size:10pt;">&#32;&#32;In the event that you purchase all of the shares of common stock available to you pursuant to your basic subscription privilege, you may also choose to purchase a portion of any shares of our common stock that are not purchased by other shareholders through the exercise of their basic subscription privileges.  If sufficient shares of common stock are available, we will seek to honor the over-subscription requests in full.  If, however, over-subscription requests exceed the number of shares of common stock available, we will allocate the available shares of common stock pro rata based on the relative ownership percentages as of the record date of shareholders requesting additional shares.  We may exercise our discretion to round down to allocate shares in ten share increments.  As described above for the basic subscription privilege, we will not issue fractional shares through the exercise of over-subscription privileges.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In order to properly exercise your over-subscription privilege, you must deliver the subscription payment related to your over-subscription privilege at the time you deliver payment related to your basic subscription privilege.  Because we will not know the actual number of unsubscribed shares prior to the expiration of the rights offering, if you wish to maximize the number of shares you purchase pursuant to your over-subscription privilege, you will need to deliver payment in an amount equal to the aggregate subscription price for the maximum number of shares of our common stock that may be available to you.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We can provide no assurances that you will be able to purchase the number of shares issuable upon the exercise of your over-subscription privilege in full.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We will not be able to satisfy any orders for shares pursuant to the over-subscription privilege if all of our shareholders exercise their basic subscription privileges in full.  We can only honor an over-subscription privilege to the extent sufficient shares of our common stock are available following the exercise of subscription rights under the basic subscription privileges.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">To the extent the aggregate subscription price of the actual number of unsubscribed shares available to you pursuant to the over-subscription privilege is less than the amount you paid in connection with the exercise of the over-subscription privilege, you will be allocated only the number of unsubscribed shares actually available to you, and any excess subscription payments will be returned to you, without interest, as soon as practicable.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">To the extent the amount you paid in connection with the exercise of the over-subscription privilege is less than the aggregate subscription price of the actual number of unsubscribed shares available to you pursuant to the over-subscription privilege, you will be allocated the number of unsubscribed shares for which you actually paid in connection with the over-subscription privilege.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Reasons for the Rights Offering</font></div><div style="line-height:120%;text-align:left;text-indent:46px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On February 25, 2013, the Company entered into a number of agreements in connection with a $91.1 million Recapitalization, including a Stock Purchase Agreement by and among the Company and the investors named therein.  Those agreements required the Company to issue and sell, in a Private Placement, approximately 60,735,000 shares of common stock at the Purchase Price of $1.50 per share.  The closing of the Private Placement occurred over two days, with the issuance of 9,941,908 shares of common stock to Treasury in exchange for 33,000 </font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">27</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">shares of the Company&#8217;s TARP Preferred Stock, the TARP Warrant to purchase 82,363 shares of common stock,  and all accrued but unpaid dividends on the TARP Preferred Stock, and the sale by Treasury of such shares of common stock to investors occurring on the TARP Closing Date of April 11, 2013, and the sale of 50,793,092 shares of common stock directly to investors occurring on the Investor Closing Date, April 12, 2013.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">As required by the Stock Purchase Agreement, we are conducting this rights offering to holders of our common stock as of April 10, 2013, the Pre-Recapitalization Shareholders, to provide the Pre-Recapitalization Shareholders with the opportunity to purchase approximately $5 million of our common stock at a purchase price per share equal to the Purchase Price.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Method of Exercising Subscription Rights</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">One non-transferable subscription right to purchase two shares of our common stock is being distributed for each share of our common stock that you owned as of 5:00 p.m., Eastern Time, on April 10, 2013.  Once exercised, the subscription rights are irrevocable and may not be cancelled or modified.  You may exercise your subscription rights as follows:</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Subscription by Registered Holders.</font><font style="font-family:inherit;font-size:10pt;font-style:italic;">&#32;</font><font style="font-family:inherit;font-size:10pt;">If you hold a First Security stock certificate, the number of rights you may exercise pursuant to your basic subscription privilege is indicated on the enclosed rights certificate.  You may exercise your subscription rights by properly completing and executing the rights certificate and forwarding it, together with your full payment, to the subscription agent at the address set forth below under &#8220;&#8212;Subscription Agent,&#8221; to be received prior to the 5:00 p.m., Eastern Time, </font><font style="font-family:inherit;font-size:10pt;">___________, </font><font style="font-family:inherit;font-size:10pt;">2013 expiration date that we have established for the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Subscription by Beneficial Owners.  </font><font style="font-family:inherit;font-size:10pt;">If you are a beneficial owner of shares of our common stock that are registered in the name of a broker, custodian bank or other nominee, you will not receive a rights certificate.  Instead, one subscription right will be issued to the nominee record holder for each share of our common stock that you owned at the record date. If you are not contacted by your nominee, you should promptly contact your nominee in order to subscribe for shares of our common stock in the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you hold your shares of common stock in the name of a custodian bank, broker, dealer or other nominee, your nominee will exercise the subscription rights on your behalf in accordance with your instructions. Your nominee may establish a deadline that may be before the 5:00 p.m., Eastern Time,</font><font style="font-family:inherit;font-size:10pt;">&#32;___________, 2013 </font><font style="font-family:inherit;font-size:10pt;">expiration date that we have established for the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If the rights are attributable to shares that were held in your account in the 401(k) Plan, you must provide your instructions to the tabulator selected by</font><font style="font-family:inherit;font-size:10pt;font-weight:bold;">&#32;</font><font style="font-family:inherit;font-size:10pt;">the 401(k) Plan&#8217;s trustee by no later than the date and time specified in the separate instructions applicable to those shares.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Payment Method</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">As described in the instructions accompanying the rights certificate, payments submitted to the subscription agent must be made in full United States currency by:</font></div><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:11pt;padding-left:48px;"><font style="font-family:inherit;font-size:11pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:10pt;">personal check payable to Registrar and Transfer Company, our subscription agent, drawn upon a United States bank;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:11pt;padding-left:48px;"><font style="font-family:inherit;font-size:11pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:10pt;">bank check or bank draft payable to Registrar and Transfer Company, drawn upon a United States bank;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:11pt;padding-left:48px;"><font style="font-family:inherit;font-size:11pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:10pt;">postal, telegraphic or express money order payable to Registrar and Transfer Company; or</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:11pt;padding-left:48px;"><font style="font-family:inherit;font-size:11pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:10pt;">wire transfer of immediately available funds to the account maintained by Registrar and Transfer Company.</font></div></td></tr></table><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you are issued subscription rights attributable to shares that were held in your account in the 401(k) Plan, the payment for the exercise of the subscription rights will be deducted from funds held in your account in the 401(k) Plan as described in more detail in the separate instructions applicable to those subscription rights.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">You should read and follow the instructions accompanying the rights certificate carefully.  As described in the instructions accompanying the rights certificate, in certain cases additional documentation or signature guarantees may be required.</font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">28</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The method of delivery of payments of the subscription amount to the subscription agent will be at the risk of the holders of subscription rights. If sent by mail, we recommend that you send those documents and payments by registered mail, properly insured, with return receipt requested, and that a sufficient number of days be allowed to ensure delivery to the subscription agent.  Do not send or deliver these materials to us or to the dealer manager.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">There is no sales fee or commission payable by you.  We will pay all fees charged by the subscription and information agent and our advisors. You are responsible for paying any other commissions, fees, taxes or other expenses incurred in connection with the exercise of the subscription rights.  </font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Medallion Guarantee May Be Required</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Your signature on your rights certificate must be guaranteed by an eligible institution, such as a member firm of a registered national securities exchange or a member of the Financial Industry Regulatory Authority, or a commercial bank or trust company having an office or correspondent in the United States, subject to standards and procedures adopted by the subscription agent, unless:</font></div><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:11pt;padding-left:48px;"><font style="font-family:inherit;font-size:11pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:10pt;">you provide on the rights certificate that shares are to be delivered in your name and to your address of record, as imprinted on the face of the rights certificate; or</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:11pt;padding-left:48px;"><font style="font-family:inherit;font-size:11pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:10pt;">you are an eligible institution.</font></div></td></tr></table><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Limit on How Many Shares of Common Stock You May Purchase in the Rights Offering</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Subject to the discretion of the board of directors, a person, together with certain related persons and associates, may not purchase a number of shares such that upon completion of the rights offering the person owns securities representing in excess of 4.9% of our outstanding common stock.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In addition, we will not issue shares of our common stock pursuant to the exercise of basic subscription rights or over-subscription rights to any person or entity who, in our sole opinion, could be required to obtain prior clearance or approval from or submit a notice to any state or federal bank regulatory authority to acquire, own or control such shares if, as of</font><font style="font-family:inherit;font-size:10pt;">&#32;___________, </font><font style="font-family:inherit;font-size:10pt;">2013, we determine that such clearance or approval has not been obtained and/or any applicable waiting period has not expired. If we elect not to issue shares in such a case, the unissued shares will become available to satisfy over-subscription by other shareholders pursuant to their subscription rights.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The term &#8220;associate&#8221; is used above to indicate any of the following relationships with a person:</font></div><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:11pt;padding-left:48px;"><font style="font-family:inherit;font-size:11pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:10pt;">any corporation or organization, other than First Security or a subsidiary thereof, of which a person is a senior officer or partner, or beneficially owns, directly or indirectly, 10% or more of any class of equity securities of the corporation or organization;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:11pt;padding-left:48px;"><font style="font-family:inherit;font-size:11pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:10pt;">any trust or other estate, if the person has a substantial beneficial interest in the trust or estate or is a trustee or fiduciary of the estate (although a person who has a substantial beneficial interest in one of our tax-qualified or non-tax-qualified employee plans, or who is a trustee or fiduciary of the plan is not an associate of the plan, and our tax-qualified employee plans are not associates of a person);</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:11pt;padding-left:48px;"><font style="font-family:inherit;font-size:11pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:10pt;">any person who is related by blood or marriage to such person and:</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman; font-size:10pt;"><tr><td style="width:144px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:96px;"><font style="font-family:inherit;font-size:10pt;">(i)</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">who lives in the same house as the person; or</font></div></td></tr></table><div style="line-height:120%;text-align:left;padding-left:144px;text-indent:-48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman; font-size:10pt;"><tr><td style="width:144px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:96px;"><font style="font-family:inherit;font-size:10pt;">(ii)</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">who is a director or senior officer of First Security or a subsidiary thereof; and</font></div></td></tr></table><div style="line-height:120%;text-align:left;padding-left:96px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:11pt;padding-left:48px;"><font style="font-family:inherit;font-size:11pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:10pt;">any person acting in concert with the persons or entities specified above.</font></div></td></tr></table><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">As used above, the term &#8220;acting in concert&#8221; means:</font></div><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:11pt;padding-left:48px;"><font style="font-family:inherit;font-size:11pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:10pt;">knowing participation in a joint activity or interdependent conscious parallel action towards a common goal, whether or not pursuant to an express agreement; or</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:11pt;padding-left:48px;"><font style="font-family:inherit;font-size:11pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:10pt;">a combination or pooling of voting or other interests in the securities of an issuer for a common purpose pursuant to any contract, understanding, relationship, agreement or other arrangement, whether written or otherwise.</font></div></td></tr></table><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">29</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">A person or company that acts in concert with another person or company (&#8220;other party&#8221;) shall also be deemed to be acting in concert with any person or company who is also acting in concert with that other party, except that any of our tax-qualified employee plans will not be deemed to be acting in concert with its trustee or a person who serves in a similar capacity solely for the purpose of determining whether stock held by the trustee and stock held by the plan will be aggregated.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Missing or Incomplete Subscription Information</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you send a payment that is insufficient to purchase the number of shares you requested, or if the number of shares you requested is not specified in the forms, the payment received will be applied to exercise your subscription rights to the fullest extent possible based on the amount of the payment received, subject to the availability of shares under the over-subscription privilege and the elimination of fractional shares.  Any excess subscription payments received by the subscription agent will be returned, without interest, as soon as practicable following the expiration of the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Expiration Date</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The subscription period, during which you may exercise your subscription rights, expires at 5:00 p.m., Eastern Time, on ___________, 2013, which is the expiration of the rights offering.  If you do not exercise your subscription rights prior to that time, your subscription rights will expire and will no longer be exercisable.  We will not be required to issue shares of our common stock to you if the subscription agent receives your rights certificate or your subscription payment after that time.  We have the option to extend the rights offering without notice to you. In no event will the expiration date be later </font><font style="font-family:inherit;font-size:10pt;">than ___________, </font><font style="font-family:inherit;font-size:10pt;">2013.  We may extend the expiration of the rights offering by giving oral or written notice to the subscription agent prior to the expiration of the rights offering.  If we elect to extend the expiration of the rights offering, we will issue a press release announcing such extension no later than the next business day after the board of directors determines to extend the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you hold your shares of common stock in the name of a custodian bank, broker, dealer or other nominee, your nominee will exercise the subscription rights on your behalf in accordance with your instructions.  Your nominee may establish a deadline that may be before the 5:00 p.m., Eastern Time,</font><font style="font-family:inherit;font-size:10pt;">&#32;___________, 2013</font><font style="font-family:inherit;font-size:10pt;">, expiration date that we have established for the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If the subscription rights are attributable to shares that were held in your account in the 401(k) Plan, you must provide your instructions to the tabulator selected by the 401(k) Plan&#8217;s trustee in the form required by the tabulator by no later than the date and time specified in the separate instructions applicable to those shares.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Determination of Subscription Price</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">As required by the Stock Purchase Agreement, we are conducting this rights offering to provide our Pre-Recapitalization Shareholders with the opportunity to purchase up to 3,329,234 shares of our common stock at a purchase price per share of $1.50, the same price per share paid by investors in the Recapitalization.  The subscription price is not necessarily related to our book value, net worth or any other established criteria of value and may or may not be considered the fair value of our common stock to be offered in the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We cannot assure you that the market price of our shares of common stock will not decline during or after the rights offering. We also cannot assure you that you will be able to sell shares of our common stock purchased during the rights offering at a price equal to or greater than the subscription price.  We urge you to obtain a current quote for our common stock before exercising your subscription rights.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Termination</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We may, in our sole discretion and for any reason, terminate the rights offering at any time prior to the completion of the rights offering.  If we terminate the rights offering, all affected subscription rights will expire without value, and neither we nor the dealer manager and the subscription agent will have any obligation to you with respect to the subscription rights except to return any exercise payment received by the subscription agent, without interest or penalty.  </font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Subscription Agent</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The subscription agent for the rights offering is Registrar and Transfer Company.  The address to which rights certificates and payments, other than wire transfers, should be mailed or delivered is provided below.  If sent </font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">30</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">by mail, we recommend that you send documents and payments by registered mail, properly insured, with return receipt requested, and that a sufficient number of days be allowed to ensure delivery to the subscription agent.  Do not send or deliver these materials to First Security or the dealer manager.</font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Registrar and Transfer Company</font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">___________</font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">___________</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you have any questions regarding completing a rights certificate or submitting payment in the rights offering, please call our subscription agent for the rights offering, Registrar and Transfer Company, at ___________, Monday through Friday (except bank holidays), between ___ a.m. and ___ p.m., ___________ T</font><font style="font-family:inherit;font-size:10pt;">ime.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Dealer Manager</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We have appointed Raymond James &amp; Associates, Inc. as dealer manager for the rights offering.  Any questions or requests regarding First Security or the rights offering may be directed to Raymond James &amp; Associates, Inc., at 404-240-2907 (or toll-free at 866-777-7789), attention: Sanjay Patel, Monday through Friday (except bank holidays), between 9:00 a.m. and 5:00 p.m., Eastern Standard Time. Banks and brokers may contact Raymond James &amp; Associates, Inc., at the number above.  We will pay the fees and expenses of the dealer manager and have also agreed to indemnify the dealer manager from certain liabilities that it may incur in connection with the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">No Fractional Shares</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">All shares will be sold at a purchase price of $1.50 per share.  We will not issue fractional shares.  Fractional shares of our common stock resulting from the exercise of the basic subscription privileges and the over-subscription privileges will be eliminated by rounding down to the nearest whole share.  Any excess subscription payments received by the subscription agent will be returned, without interest, as soon as practicable.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Notice to Nominees</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you are a broker, custodian bank or other nominee holder that holds shares of our common stock for the account of others on the record date, you should notify the beneficial owners of the shares for whom you are the nominee of the rights offering as soon as possible to learn their intentions with respect to exercising their subscription rights.  You should obtain instructions from the beneficial owners, as set forth in the instructions we have provided to you for your distribution to beneficial owners.  If a registered holder of our common stock so instructs, you should complete the rights certificate and submit it to the subscription agent with the proper subscription payment to be received by the expiration date.  You may exercise the number of subscription rights to which all beneficial owners in the aggregate otherwise would have been entitled had they been direct holders of our common stock on the record date, provided that you, as a nominee record holder, make a proper showing to the subscription agent by submitting the form entitled &#8220;Nominee Holder Certification,&#8221; which is provided with your rights offering materials.  If you did not receive this form, you should contact the subscription agent to request a copy.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Beneficial Owners</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you are a beneficial owner of shares of our common stock and will receive your subscription rights through a broker, custodian bank or other nominee, we will ask your nominee to notify you of the rights offering.  If you wish to exercise your subscription rights, you will need to have your broker, custodian bank or other nominee act for you, as described above.  To indicate your decision with respect to your subscription rights, you should follow the instructions of your nominee. If you wish instead to obtain a separate rights certificate, you should contact your nominee as soon as possible and request that a rights certificate be issued to you.  You should contact your nominee if you do not receive notice of the rights offering, but you believe you are entitled to participate in the rights offering.  We are not responsible if you do not receive the notice by mail or otherwise from your nominee or if you receive notice without sufficient time to respond to your nom</font><font style="font-family:inherit;font-size:10pt;">inee by the deadline established by your nominee, which may be before the 5:00 p.m., Eastern Time, ___________,</font><font style="font-family:inherit;font-size:10pt;">&#32;2013 expiration date that we have established for the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you were a beneficial owner of shares of our common stock through the 401(k) Plan as of the record date, subscription rights attributable to shares held in your account in the 401(k) Plan will be issued to your account in the 401(k) Plan.  You will need to notify the tabulator selected by the trustee for the 401(k) Plan if you wish to </font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">31</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">exercise your subscription rights.  To indicate your decision with respect to those subscription rights, you should follow the separate instructions provided by the tabulator.  You should contact the tabulator if you do not receive notice of the rights offering, but you believe you are entitled to participate in the rights offering based on stock that you held in the 401(k) Plan as of 5:00 p.m. Eastern Time on April 10, 2013.  You must respond to the tabul</font><font style="font-family:inherit;font-size:10pt;">ator by the deadline established by the tabulator, which may be before the 5:00 p.m., Eastern Time, ___________,</font><font style="font-family:inherit;font-size:10pt;">&#32;2013, expiration date.  The deadline and any special instructions will be included in separate instructions issued to you with respect to those subscription rights.  Those instructions only apply to subscription rights issued to your account in the 401(k) Plan.  Therefore, if you have subscription rights issued to your account in the 401(k) Plan and subscription rights issued with respect to other stock you held, you will need to provide separate instructions, and potentially comply with separate deadlines, with respect to those subscription rights.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Non-Transferability of Subscription Rights</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The subscription rights granted to you are non-transferable and, therefore, you may not sell, transfer or assign your subscription rights to anyone. The subscription rights will not be quoted on the NASDAQ Capital Market or any other stock exchange or market.  The shares of our common stock issuable upon exercise of the subscription rights will be traded on the NASDAQ Capital Market under the ticker symbol &#8220;FSGI.&#8221;</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Validity of Subscriptions</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We will resolve all questions regarding the validity and form of the exercise of your subscription rights, including time of receipt and eligibility to participate in the rights offering.  Our determination will be final and binding.  Once made, subscriptions and directions are irrevocable, and we will not accept any alternative, conditional or contingent subscriptions or directions.  We reserve the absolute right to reject any subscriptions or directions not properly submitted or the acceptance of which would be unlawful. You must resolve any irregularities in connection with your subscriptions before the subscription period expires, unless waived by us in our sole discretion.  Neither we nor the subscription agent shall be under any duty to notify you or your representative of defects in your subscriptions.  A subscription will be considered accepted, subject to our right to withdraw or terminate the rights offering, only when a properly completed and duly executed rights certificate and any other required documents and the full subscription payment have been received by the subscription agent.  Our interpretations of the terms and conditions of the rights offering will be final and binding.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Escrow Arrangements; Return of Funds</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The subscription agent will hold funds received in payment for shares of our common stock in a segregated account pending completion of the rights offering.  The subscription agent will hold this money in escrow until the rights offering is completed or is withdrawn and canceled.  If the rights offering is canceled for any reason, all subscription payments received by the subscription agent will be returned promptly, without interest or penalty.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Shareholder Rights</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">You will have no rights as a holder of the shares of our common stock you purchase in the rights offering until certificates representing the shares of our common stock are issued to you, or your account at your nominee is credited with the shares of our common stock purchased in the rights offering.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Foreign Shareholders</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We will not mail this prospectus or rights certificates to shareholders with addresses that are outside the United States or that have an army post office or foreign post office address.  The subscription agent will hold these rights certificates for the account of such shareholders.  To exercise subscription rights, our foreign shareholders must notify the subscription agent prior to 5:00 p.m., Eastern Time, at least three business days prior to the expiration of the rights offering (or, if the rights offering is extended, on or before three business days prior to the extended expiration date) and demonstrate to the satisfaction of the subscription agent that the exercise of such subscription rights does not violate the laws of the jurisdiction of such shareholder.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">No Revocation or Change</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Once you submit the rights certificate or have instructed your nominee of your subscription request, you are not allowed to revoke or change the exercise or request a refund of monies paid.  All exercises of subscription rights are irrevocable, even if you learn information about us that you consider to be unfavorable.  However, with respect </font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">32</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">to subscription rights issued to your account in the 401(k) Plan, if the market price of the stock is less than the subscription price on the date the subscription rights are exercised, the trustee will not execute your instructions to purchase the common stock and your money will be refunded to your account in the 401(k) Plan. You should not exercise your subscription rights unless you are certain that you wish to purchase additional shares of our common stock at the subscription price.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Purchase Limitations</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Subject to the discretion of the board of directors, a person, together with certain related persons and associates, may not purchase a number of shares such that upon completion of the rights offering the person owns securities representing in excess of 4.9% of our outstanding common stock.  Additionally, federal law generally requires prior regulatory approval for any person or persons acting in concert to acquire 10% or more of our common stock.  We will not issue shares of our common stock pursuant to the exercise of basic subscription rights or over-subscription rights to any person or entity who, in our sole opinion, could be required to obtain prior clearance or approval from or submit a notice to any state or federal bank regulatory authority to acquire, own or control such shares if, as of</font><font style="font-family:inherit;font-size:10pt;">&#32;___________, 2013</font><font style="font-family:inherit;font-size:10pt;">, we determine that such clearance or approval has not been obtained and/or any applicable waiting period has not expired. If we elect not to issue shares in such a case, the unissued shares will become available to satisfy over-subscription elections by other shareholders pursuant to their subscription rights.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Material U.S. Federal Income Tax Treatment of Rights Distribution</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">For U.S. federal income tax purposes, you should not recognize income or loss upon the receipt, exercise or lapse of the subscription rights for the reasons described below in &#8220;Material U.S. Federal Income Tax Consequences.&#8221;</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">No Recommendation to Rights Holders</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Our board of directors is making no recommendation regarding your exercise of the subscription rights.  Shareholders who exercise subscription rights risk investment loss on new money invested.  We cannot assure you that the market price for our common stock will be above the subscription price or that anyone purchasing shares at the subscription price will be able to sell those shares in the future at the same price or a higher price.  You are urged to make your decision based on your own assessment of our business and the rights offering.  Please see the &#8220;Risk Factors&#8221; section of this prospectus and the information incorporated by reference herein and contained in the section entitled "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2012 and any risks described in our other filings with the SEC pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act for a discussion of some of the risks involved in investing in our common stock.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Shares of Our Common Stock Outstanding After the Rights Offering</font></div><div style="line-height:120%;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">As of April 10, 2013, 1,795,542</font><font style="font-family:inherit;font-size:10pt;font-weight:bold;">&#32;</font><font style="font-family:inherit;font-size:10pt;">shares of our common stock were issued and outstanding.  On April 11, 2013 and April 12, 2013, the date following the record date for the rights offering, we issued an additional 60,735,000 shares of common stock in the Recapitalization and 107,175 shares of restricted stock were forfeited pursuant to the terms of the Exchange Agreement, leaving us with 62,423,367 shares of common stock outstanding immediately following the Recapitalization.  Assuming no options are exercised prior to the expiration of the rights offering and assuming all 3,329,234 shares are sold in the rights offering, we expect 65,752,601 shares of our common stock will be outstanding immediately after completion of the rights offering.</font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">33</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">DESCRIPTION OF CAPITAL STOCK</font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The following description of the terms and conditions of our capital stock is qualified in its entirety by reference to our Amended and Restated Articles of Incorporation, our Amended and Restated Bylaws, and to Tennessee or federal law applicable to us.  For a more thorough understanding of the terms of our capital stock, you should refer to our Amended and Restated Articles of Incorporation and our Amended and Restated Bylaws, which are filed as exhibits to the registration statement of which this prospectus is a part.</font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The authorized capital stock of First Security presently consists of 150,000,000 shares of common stock and 10,000,000 shares of preferred stock.  As of July 3, 2013, 62,428,367 shares of our common stock were issued and outstanding, 127,196 shares of common stock were issuable upon exercise of outstanding stock options and approximately 149,000 shares of common stock were reserved for future issuance under our stock option plans, and no shares of preferred stock were issued and outstanding.  On June 18, 2013, the Company filed a definitive proxy statement requesting that our shareholders approve an amendment to the Company&#8217;s Articles of Incorporation to permit the Board of Directors to effect a one-for-ten (1-for-10) reverse stock split.  Our annual shareholders meeting is July 24, 2013 and our shareholders will vote on the reverse stock split at that meeting.  The description of our capital stock set forth below is only a summary.  The full terms of our capital stock are set forth in Exhibits&#160;3.1, 3.2, 4.1 and 4.2 to the registration statement of which this prospectus is a part and incorporated by reference herein.</font></div><div style="line-height:120%;padding-bottom:13px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Description of Common Stock</font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The following section describes the material features and rights of our common stock.  The summary does not purport to be exhaustive and is qualified in its entirety by reference to our Amended and Restated Articles of Incorporation and our Amended and Restated Bylaws, each of which is filed as an exhibit to the registration statement of which this prospectus is a part, and to applicable Tennessee law.</font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">General.  </font><font style="font-family:inherit;font-size:10pt;">The holders of our common stock have one vote per share on all matters submitted to a vote of our shareholders.  There are no cumulative voting rights for the election of directors.  Holders of common stock are entitled to receive ratably such dividends as may be declared by the Board of Directors out of legally available funds, subject to preferences that may be applicable to any outstanding series of preferred stock.  In the event of a liquidation, dissolution or winding up of First Security, the holders of common stock are entitled to share ratably in all assets remaining after payment of liabilities and the liquidation preference of any outstanding preferred stock. Holders of shares of our common stock have no preemptive, subscription, redemption, sinking fund or conversion rights.</font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Dividends.  </font><font style="font-family:inherit;font-size:10pt;">The holders of our common stock are entitled to receive dividends declared by our Board of Directors out of funds legally available therefor. Our ability to pay dividends depends on the amount of dividends paid to us by our subsidiaries.  The payment of dividends is subject to government regulation, in that regulatory authorities may prohibit banks and bank holding companies from paying dividends in a manner that would constitute an unsafe or unsound banking practice.  In addition, a bank may not pay cash dividends if doing so would reduce the amount of its capital below that necessary to meet minimum regulatory capital requirements.  State laws also limit a bank&#8217;s ability to pay dividends.  Accordingly, the dividend restrictions imposed on our subsidiaries by statute or regulation effectively may limit the amount of dividends we can pay.</font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Transfer Agent.  </font><font style="font-family:inherit;font-size:10pt;">The transfer agent and registrar for our common stock is Registrar and Transfer Company.</font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Description of Preferred Stock</font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We are authorized to issue 10,000,000 shares of preferred stock, no par value per share.  The 10,000,000 authorized but unissued shares of preferred stock are typically referred to as &#8220;blank check&#8221; preferred stock.  This term refers to preferred stock for which the rights and restrictions are determined by the board of directors of a corporation.  We do not have any preferred stock outstanding, however under our Amended and Restated Articles of Incorporation, our Board of Directors has the authority, without any further shareholder vote or action, to issue the remaining preferred stock in one or more series and to fix, determine or amend the relative rights and preferences of any series so established, within the limitations set forth by the Tennessee Business Corporation Act, relating to the powers, designations, rights, preferences, and restrictions thereof, including but not limited to:</font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">34</font></div></div><hr style="page-break-after:always"><div></div><br><table cellpadding="0" cellspacing="0" style="padding-top:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:48px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the designation, stated value and liquidation preference of such preferred stock and the amount of stock offered; </font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:48px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the offering price; </font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:48px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the dividend rate or rates (or method of calculation), the date or dates from which dividends shall accrue, and whether such dividends shall be cumulative or noncumulative and, if cumulative, the dates from which dividends shall commence to cumulate;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:48px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">any redemption or sinking fund provisions; </font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:48px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the amount that shares of such series shall be entitled to receive in the event of our liquidation, dissolution or winding-up; </font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:48px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the terms and conditions, if any, on which shares of such series shall be convertible or exchangeable for shares of our stock of any other class or classes, or other series of the same class;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:48px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the voting rights, if any, of shares of such series;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:48px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the status as to reissuance or sale of shares of such series redeemed, purchased or otherwise reacquired, or surrendered to us on conversion or exchange;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:48px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the conditions and restrictions, if any, on the payment of dividends or on the making of other distributions on, or the purchase, redemption or other acquisition by us or any subsidiary, of the common stock or of any other class of our shares ranking junior to the shares of such series as to dividends or upon liquidation;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:48px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the conditions and restrictions, if any, on the creation of indebtedness of us or of any subsidiary, or on the issuance of any additional stock ranking on a parity with or prior to the shares of such series as to dividends or upon liquidation; and </font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:48px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">any additional dividend, liquidation, redemption, sinking or retirement fund and other rights, preferences, privileges, limitations and restrictions of such preferred stock.</font></div></td></tr></table><div style="line-height:120%;padding-top:8px;text-align:left;padding-left:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The existence of blank-check preferred stock could have the effect of making it more difficult or time consuming for a third party to acquire a majority of our outstanding voting stock or otherwise effect a change of control.  Within the limits described above, the Board may issue preferred stock for capital raising transactions, acquisitions, joint ventures or other corporate purposes that have the effect of making an acquisition of the Company more difficult or costly, as could also be the case if the Board were to issue additional common stock for such purposes.  One series of preferred stock has been designated for possible issuance in the future.  See &#8220;Anti-takeover Effects of Certain Provisions in Our Articles, Bylaws and Tennessee Law -- Tax Benefits Preservation Plan and Designation of Series B Participating Preferred Stock.&#8221;</font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Anti-takeover Effects of Certain Provisions of Our Articles, Bylaws and Tennessee Law</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Consideration of Factors Other than Price.  </font><font style="font-family:inherit;font-size:10pt;">A Tennessee corporation&#8217;s charter may specifically authorize the members of its board of directors, in the exercise of their judgment, to give due consideration to factors other than price and to consider whether a merger, exchange, tender offer, or significant disposition of assets would adversely affect the corporation&#8217;s employees, customers, suppliers, the communities in which the corporation operates, or any other relevant factor in the exercise of their fiduciary duty to the shareholders.  The Company&#8217;s Amended and Restated Articles of Incorporation authorize our Board of Directors to take into consideration, in addition to price, the following factors in connection with a merger, tender offer, or other proposed business combination:</font></div><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:93px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the business, financial condition, and earnings prospects of the acquiring person;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:93px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the competence, experience, and integrity of the acquiring person;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:93px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the prospects for a successful conclusion of the business combination;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:93px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">our prospects as an independent entity; and</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-bottom:13px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:93px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:46px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the social and economic impact of the proposed transaction on us and our employees, depositors, loan and other customers, creditors, and the communities in which we operate.</font></div></td></tr></table><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">35</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The provisions of the Company&#8217;s Amended and Restated Articles of Incorporation may have the effect of protecting us from unwanted takeover bids because the Board of Directors is permitted to take into account in good faith all relevant factors in performing its duly authorized duties.</font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Blank-Check Preferred Stock</font><font style="font-family:inherit;font-size:10pt;font-weight:bold;">.</font><font style="font-family:inherit;font-size:10pt;font-style:italic;">&#32;&#32;</font><font style="font-family:inherit;font-size:10pt;">As noted above, our Board of Directors, without shareholder approval, has the authority under our Amended and Restated Articles of Incorporation to issue preferred stock with rights superior to the rights of the holders of common stock.  As a result, preferred stock, while not intended as a defensive measure against takeovers, could be issued quickly and easily, could adversely affect the rights of holders of common stock and could make it more difficult or time consuming for a third party to acquire a majority of our outstanding voting stock or otherwise effect a change of control.  The Board may issue preferred stock for capital raising transactions, acquisitions, joint ventures or other corporate purposes that have the effect of making an acquisition of the Company more difficult or costly, as could also be the case if the Board were to issue additional common stock for such purposes.</font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Tax Benefits Preservation Plan and Designation of Series B Participating Preferred Stock</font><font style="font-family:inherit;font-size:10pt;">.  On October 24, 2012, the Board of Directors of the Company authorized the adoption by the Company of a Tax Benefits Preservation Plan (the &#8220;Plan&#8221;) and declared a dividend of one preferred stock purchase right (each an &#8220;NOL Right&#8221; and collectively, the &#8220;NOL Rights&#8221;) for each outstanding share of the common stock, payable to holders of record as of the close of business on November 12, 2012.  The Company adopted the Plan on October 30, 2012.  Each NOL Right entitles the registered holder to purchase from the Company one one-thousandth of one share of Series B Participating Preferred Stock, no par value, of the Company (the &#8220;Series B Preferred Stock&#8221;), at a purchase price equal to $20.00 per one one-thousandth of a share, subject to adjustment (the &#8220;NOL Purchase Price&#8221;). The description and terms of the NOL Rights are set forth in the Plan, dated October 30, 2012, as the same may be amended from time to time, between the Company and Registrar and Transfer Company, as Rights Agent.  The full terms of the Plan are set forth in Exhibit 4.2 to the registration statement of which this prospectus is a part and incorporated by reference herein. </font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Purpose of the Plan</font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Company has previously experienced substantial net operating losses, which it may &#8220;carry forward&#8221; in certain circumstances to offset current and future taxable income and thus reduce its federal income tax liability, subject to certain requirements and restrictions.  The purpose of the Plan is to help preserve the value of the Company's deferred tax assets, such as its net operating losses (&#8220;Tax Benefits&#8221;), for U.S. federal income tax purposes. </font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">These Tax Benefits can be valuable to the Company.  However, if the Company experiences an &#8220;ownership change,&#8221; as defined in Section 382 (&#8220;Section 382&#8221;) of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations promulgated thereunder, its ability to use the Tax Benefits could be substantially limited and/or delayed, which would significantly impair the value of the Tax Benefits.  Generally, the Company would experience an &#8220;ownership change&#8221; under Section 382 if one or more &#8220;5 percent shareholders&#8221; increase their aggregate percentage ownership by more than 50 percentage points over the lowest percentage of stock owned by such shareholders over the preceding three-year period.  As a result, the Company has utilized a 5% &#8220;trigger&#8221; threshold in the Plan that is intended to act as a deterrent to any person or entity seeking to acquire 5% or more of the outstanding common stock without the prior approval of the Board. </font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Exercise </font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Prior to a Distribution Date (as defined below), the NOL Rights are not exercisable.  After a Distribution Date, each Right is exercisable to purchase, for the NOL Purchase Price, one one-thousandth of a share of Series B Preferred Stock. </font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Distribution Date means the earlier of: </font></div><table cellpadding="0" cellspacing="0" style="padding-bottom:13px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:96px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:72px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the 10th business day after public announcement that any person or group has become an Acquiring Person (as defined below); and</font></div></td></tr></table><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">36</font></div></div><hr style="page-break-after:always"><div></div><br><table cellpadding="0" cellspacing="0" style="padding-bottom:13px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:96px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:72px;"><font style="font-family:inherit;font-size:10pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">the 10th business day after the date of the commencement of a tender or exchange offer by any person which would or could, if consummated, result in such person becoming an Acquiring Person, subject to extension by the Board.</font></div></td></tr></table><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Flip-In </font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If any person or group becomes a &#8220;5-percent shareholder&#8221; (an &#8220;Acquiring Person&#8221;) (subject to certain exceptions described in the Plan), then on a Distribution Date, each NOL Right (other than NOL Rights beneficially owned by the Acquiring Person and certain affiliated persons) will entitle the holder to purchase, for the NOL Purchase Price, a number of shares of common stock of the Company equal to the quotient of (x) two times the NOL Purchase Price divided by (y) the then current market price of the Company's common stock; provided that (i) none of the Company and certain affiliates of the Company shall be an Acquiring Person, (ii) none of certain existing &#8220;5-percent shareholders&#8221; (including certain persons who are &#8220;5-percent shareholders&#8221; following specified exchange offers with the Company) shall be an Acquiring Person unless and until any such &#8220;5-percent shareholder&#8221; increases its percentage stock ownership in the Company by more than one-tenth of one percentage point, (iii) none of certain other &#8220;grandfathered persons&#8221; (as described in the Plan) shall be an Acquiring Person so long as any such &#8220;grandfathered person&#8221; satisfies the applicable requirements set forth in the Plan, (iv) no person or group who or which the Board determines, in its sole discretion, has inadvertently become a &#8220;5-percent shareholder&#8221; (or inadvertently failed to continue to qualify as a &#8220;grandfathered person&#8221;) shall be an Acquiring Person so long as such Person promptly enters into, and delivers to the Company, an irrevocable commitment promptly to divest, and thereafter promptly divests (without exercising or retaining any power, including voting, with respect to such securities), sufficient securities of the Company so that such person's (or such group's) percentage stock ownership in the Company is less than 5 percent (or, in the case of any person or group that has inadvertently failed to qualify as a &#8220;grandfathered person,&#8221; the securities of the Company that caused such person or group to fail to qualify as a &#8220;grandfathered person&#8221;) , (v) no person or group that has become a &#8220;5-percent shareholder&#8221; shall be an Acquiring Person if the Board in good faith determines that such person's or group's attainment of &#8220;5-percent shareholder&#8221; status has not jeopardized or endangered the Company's utilization of the Tax Benefits or is otherwise in the best interests of the Company; provided that such a person or group shall be an &#8220;Acquiring Person&#8221; if the Board makes a contrary determination in good faith, and (vi) an acquisition by a person or group of at least a majority of the Company's common stock made by that person or group as part of a &#8220;qualified offer&#8221; (as defined in the Plan) shall not result in any person or group becoming an Acquiring Person. </font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Exchange </font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">At any time after any person has become an Acquiring Person (but before any person becomes the beneficial owner of 50% or more of the Company's common stock), the Board may elect to exchange all or part of the NOL Rights (other than the NOL Rights beneficially owned by the Acquiring Person and certain affiliated persons) for one share of common stock (or, at the option of the Board, fractional shares of preferred stock with an aggregate current market price that equals the current market price of one share of common stock) per NOL Right, subject to adjustment. </font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Redemption </font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Board may, at its option, redeem all, but not less than all, of the then outstanding NOL Rights at a redemption price of $0.00001 per Right at any time prior to a Distribution Date. </font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Expiration </font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The NOL Rights will expire on the earliest of (i) October 30, 2022, (ii) the time at which all NOL Rights are redeemed or exchanged, (iii) the first day of a taxable year of the Company as to which the Board determines that no Tax Benefits may be carried forward, (iv) a date on which the Board determines that a limitation on the use of the Tax Benefits under Section 382 would no longer be material to the Company, provided that such date is prior to public disclosure that a person became an Acquiring Person, (v) the repeal or amendment of Section 382 or any successor statute, if the Board determines that the Plan is no longer necessary for the preservation of Tax Benefits, (vi) the final adjournment of the Company's 2013 annual meeting of shareholders if the approval of the Plan by a majority of the shareholders voting at such meeting has not been received before such time, and (vii) the close of business on the date that is the final adjournment of the third annual meeting of shareholders following the last annual meeting of shareholders at which the Plan was most recently approved by a majority of shareholders voting </font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">37</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;padding-bottom:13px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">at such meeting, unless the Plan is re-approved by a majority of the shareholders at such third annual meeting of shareholders. </font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Amendments </font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">At any time on or prior to a Distribution Date, the Company may, and the Rights Agent shall if the Company so directs, supplement or amend any provision of the Plan without the approval of any holders of NOL Rights. </font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">After a Distribution Date, the Company may, and the Rights Agent shall if the Company so directs, supplement or amend the Plan without the approval of any holders of NOL Rights; provided, however, that no such supplement or amendment may (a) adversely affect the interests of the holders of NOL Rights as such (other than an Acquiring Person), (b) cause the Plan again to become amendable other than in accordance with this sentence or (c) cause the NOL Rights again to become redeemable. </font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Shareholder Rights </font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">NOL Rights holders, in their capacity as such, have no rights as a shareholder of the Company, including the right to vote and to receive dividends. </font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;">Anti-dilution Provisions </font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Plan includes anti-dilution provisions designed to prevent efforts to diminish the efficacy of the NOL Rights.</font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Business Combination Act.  </font><font style="font-family:inherit;font-size:10pt;">Because the Company&#8217;s common stock is registered with the SEC under the Securities Exchange Act of 1934, the Business Combination Act automatically applies to the Company unless the shareholders adopt a charter or bylaw amendment that expressly excludes the Company from the anti-takeover provisions of the Business Combination Act two years prior to a proposed takeover.  The Board of Directors has no present intention of recommending such charter or bylaw amendment.</font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Business Combination Act imposes a five-year standstill on transactions such as mergers, share exchanges, sales of significant assets, liquidations, and other interested party transactions between Tennessee corporations and &#8220;interested shareholders&#8221; and their associates or affiliates, unless the business combination is approved by the Board of Directors before the interested shareholder acquires 10% or more of the beneficial ownership of any class of the corporation&#8217;s voting securities.  Thereafter, the transaction either requires a two-thirds vote of the shareholders other than the interested shareholder or must satisfy certain fair price standards.</font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Business Combination Act also provides exculpatory protection for the Board of Directors in refusing to waive the protections afforded under the Business Combination Act and/or Control Share Acquisition Act, or for resisting mergers, exchanges, tender offers, and similar transactions based on criteria other than price</font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Control Share Acquisition Act.  </font><font style="font-family:inherit;font-size:10pt;">The Control Share Acquisition Act limits the voting rights of shares owned by a person above certain percentage thresholds (generally 20%) unless the non-interested shareholders of the corporation approve the acquisition of additional shares by the interested shareholder above the designated threshold.  However, the Control Share Acquisition Act applies only to corporations whose articles of incorporation or bylaws contain an express declaration that control share acquisitions are to be governed by the Control Share Acquisition Act.  In addition, the articles of incorporation or bylaws may specifically provide for the redemption of the control shares (shares in excess of the designated threshold) or appraisal rights for dissenting shareholders in a control share transaction.  Neither the Company&#8217;s Amended and Restated Articles of Incorporation nor its Amended and Restated Bylaws currently contain a provision that subjects the Company to the provisions of the Control Share Acquisition Act, and the Board of Directors has no present intention of adopting any such bylaw amendment.  However, the Board of Directors could adopt such a bylaw amendment at any future time by majority vote based on facts and circumstances then present.</font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Greenmail Act.  </font><font style="font-family:inherit;font-size:10pt;">The Greenmail Act applies to a Tennessee corporation that has a class of voting stock registered or traded on a national securities exchange or registered with the SEC pursuant to Section 12(g) of the Exchange Act.  Under the Greenmail Act, the Company may not purchase any of its shares at a price above the market value of such shares from any person who holds more than 3.0% of the class of securities to be purchased if </font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">38</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;padding-bottom:13px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">such person has held such shares for less than two years, unless the purchase has been approved by the affirmative vote of a majority of the outstanding shares of each class of voting stock issued by the Company or the Company makes an offer, of at least equal value per share, to all shareholders of such class.</font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Investor Protection Act.  </font><font style="font-family:inherit;font-size:10pt;">The Investor Protection Act generally requires the registration, or an exemption from registration, before a person can make a tender offer for shares of a Tennessee corporation which, if successful, would result in the person beneficially owning more than 10% of any class.  Registration requires the filing with the Tennessee Commissioner of Commerce and Insurance of a registration statement, a copy of which must be sent to the target company, and the public disclosure of the material terms of the proposed offer.  The Investor Protection Act also prohibits fraudulent and deceptive practices in connection with takeover offers, and provides remedies for violations.</font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Investor Protection Act does not apply to an offer involving a vote by holders of equity securities of the target company, pursuant to its articles of incorporation, on a merger, consolidation, or sale of corporate assets in consideration of the issuance of securities of another corporation, or on a sale of its securities in exchange for cash or securities of another corporation.  Also excluded from the Investor Protection Act are tender offers that are open on substantially equal terms to all shareholders, are recommended by the board of directors of the target company, and include full disclosure of all terms.</font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">General Effects.  </font><font style="font-family:inherit;font-size:10pt;">The provisions described above, to the extent applicable, will have the general effect of discouraging, or rendering more difficult, unfriendly takeover or acquisition attempts.  Consequently, such provisions would be beneficial to current management in an unfriendly takeover attempt but could have an adverse effect on shareholders who might wish to participate in such a transaction.  However, the Company believes that such provisions are advantageous to the shareholders in that these provisions will permit management and the shareholders to carefully consider and understand a proposed acquisition, lead to higher offering prices, and require a higher level of shareholder participation in the decision if the transaction is not approved by our Board of Directors.</font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">39</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><a name="s9CA5E91F1CD212E9F3F68B32D5808A4F"></a><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">PLAN OF DISTRIBUTION</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We are offering shares of our common stock directly to you pursuant to the rights offering.  Our officers and directors may contact holders of our common stock by mail, telephone, facsimile, and personal interview and may request brokers, custodian banks or other nominee holders on your behalf to forward materials relating to the offers to beneficial owners of our common stock.  These officers, directors, and other employees will not receive any commissions or compensation in connection with these activities other than their normal compensation.  We have retained Raymond James &amp; Associates, Inc. to act as dealer manager in connection with the rights offering.  The dealer manager will use its reasonable efforts to advise and assist us in our efforts to solicit existing shareholders to exercise subscription rights in the rights offering, but will not underwrite the rights offering and has no obligation to purchase or procure purchases of the subscription rights or common stock offered hereby or otherwise act in any capacity whatsoever as an underwriter. </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">For acting as dealer manager, we have agreed to pay the dealer manager a fee equal to the greater of (i) 6.0% of the gross proceeds received from the rights offering and (ii) $200,000.  In addition, we have agreed to reimburse the dealer manager for its reasonable out-of-pocket expenses, up to</font><font style="font-family:inherit;font-size:10pt;">&#32;$100,000</font><font style="font-family:inherit;font-size:10pt;">.  Other than the dealer manager, we have not employed any brokers, dealers or underwriters to assist in the solicitation of the exercise of subscription rights in the rights offering and, except as just described, no other commissions, fees or discounts will be paid in connection with the rights offering. </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Although Raymond James &amp; Associates, Inc. has no obligation to act, and will not act, in any capacity as an underwriter in the rights offering, if it were nonetheless deemed to be an underwriter under the Securities Act, the fees and commissions to be paid to it might be deemed to be underwriting fees and commissions.  We have agreed to indemnify Raymond James &amp; Associates, Inc. against certain liabilities and expenses in connection with its engagement, including certain potential liabilities under the federal securities laws.  We will also pay the fees and expenses of Registrar and Transfer Company, as subscription agent, and we have agreed to indemnify the subscription agent from certain liabilities in connection with the rights offering.  We will pay out-of-pocket expenses, including payments to legal advisors, accountants, the dealer manager, subscription agent, printing costs, mailing costs, and filing fees estimated to total approximately $</font><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#32;&#32;&#32;&#32;&#32;&#32;&#32;&#32;&#32;</font><font style="font-family:inherit;font-size:10pt;">. </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The dealer manager has not prepared any report or opinion constituting a recommendation or advice to us or to our shareholders, nor has the dealer manager prepared an opinion as to the fairness of the subscription price or the terms of the rights offering.  The dealer manager expresses no opinion and makes no recommendation to our shareholders as to the purchase by any person of any shares of our common stock.  The dealer manager expresses no opinion as to the prices that the shares of common stock may trade for if and when they are issued or at any future time. </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In the ordinary course of its business, Raymond James &amp; Associates, Inc. and/or its affiliates have in the past performed investment banking and other services for us for which they have received customary compensation.  In the ordinary course of its business, Raymond James &amp; Associates, Inc. and/or its affiliates may in the future perform investment banking or other services for us for which it will receive customary compensation. </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">As soon as practicable, we will distribute subscription rights certificates to shareholders who owned shares of our common stock at 5:00 p.m., Eastern Time, on April 10, 2013.  If you wish to exercise your subscription rights and purchase shares of our common stock, you should complete the subscription rights certificate and return it with payment for the shares to the subscription agent, Registrar and Transfer Company, at: </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">By Mail:</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Registrar and Transfer Company</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">___________</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">___________ </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">By Hand or By Overnight Courier: </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Registrar and Transfer Company </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">___________</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">___________ </font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">40</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:center;font-size:12pt;"><font style="font-family:inherit;font-size:12pt;"><br></font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">See &#8220;The Rights Offering &#8212; Method of Exercising Subscription Rights.&#8221;  If you have any questions, you should contact the subscription agent, Registrar and Transfer Company,  at</font><font style="font-family:inherit;font-size:10pt;">&#32;___________. </font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">41</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The following summary describes the material U.S. federal income tax consequences of the receipt, exercise and expiration of the subscription rights acquired through the rights offering and owning and disposing of the shares of common stock received upon exercise of the subscription rights.  Insofar as the summary relates to matters of U.S. federal income tax law and regulations or legal conclusions with respect thereto, the summary constitutes the opinion of our tax counsel, Bryan Cave LLP.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">This summary is based upon the Internal Revenue Code of 1986, as amended (the &#8220;Code&#8221;), Treasury regulations promulgated thereunder and administrative and judicial interpretations thereof, all as currently in effect and all of which are subject to differing interpretations or to change, possibly with retroactive effect.  No assurance can be given that the Internal Revenue Service (&#8220;IRS&#8221;) would not assert, or that a court would not sustain, a position contrary to any of the tax consequences described below.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">This summary is for general information only and does not purport to discuss all aspects of U.S. federal income taxation that may be important to a particular holder in light of the holder&#8217;s particular circumstances or to holders that may be subject to special tax rules, including, but not limited to, partnerships or other pass-through entities, banks and other financial institutions, tax-exempt entities, employee stock ownership plans, certain former citizens or residents of the United States, insurance companies, regulated investment companies, real estate investment trusts, dealers in securities or currencies, brokers, traders in securities that have elected to use the mark-to-market method of accounting, persons holding subscription rights or shares of common stock as part of an integrated transaction, including a &#8220;straddle,&#8221; &#8220;hedge,&#8221; &#8220;constructive sale&#8221; or &#8220;conversion transaction,&#8221; persons whose functional currency for tax purposes is not the U.S. dollar, and persons subject to the alternative minimum tax provisions of the Code.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">This summary applies to you only if you are a U.S. holder (as defined below) and receive your subscription rights in the rights offering, and you hold your subscription rights or shares of common stock issued to you upon exercise of the subscription rights as capital assets for tax purposes. This summary does not apply to you if you are not a U.S. holder.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We have not sought, and will not seek, a ruling from the IRS regarding the federal income tax consequences of the rights offering or the related share issuances. The following summary does not address the tax consequences of the rights offering or the related share issuance under foreign, state, or local tax laws.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">You are a U.S. holder if you are a beneficial owner of subscription rights or common stock and you are:</font></div><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman; font-size:10pt;"><tr><td style="width:96px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:11pt;padding-left:48px;"><font style="font-family:inherit;font-size:11pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:10pt;">An individual who is a citizen or resident of the United States for U.S. federal income tax purposes;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman; font-size:10pt;"><tr><td style="width:96px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:11pt;padding-left:48px;"><font style="font-family:inherit;font-size:11pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:10pt;">A corporation (or other business entity treated as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of Columbia;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman; font-size:10pt;"><tr><td style="width:96px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:11pt;padding-left:48px;"><font style="font-family:inherit;font-size:11pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:10pt;">An estate the income of which is subject to U.S. federal income tax regardless of its source; or</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman; font-size:10pt;"><tr><td style="width:96px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:11pt;padding-left:48px;"><font style="font-family:inherit;font-size:11pt;">&#8226;</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:10pt;">A trust (a) if a court within the United States can exercise primary supervision over its administration and one or more U.S. persons are authorized to control all substantial decisions of the trust or (b) that has a valid election in effect under applicable Treasury Regulations to be treated as a U.S. person.</font></div></td></tr></table><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If a partnership (including any entity treated as a partnership for U.S. federal income tax purposes) receives the subscription rights or holds the common stock received upon exercise of the subscription rights, the tax treatment of a partner in such partnership generally will depend upon the status of the partner and the activities of the partnership. Such a partner or partnership is urged to consult its own tax advisor as to the U.S. federal income tax consequences of receiving and exercising the subscription rights and acquiring, holding or disposing of our common shares.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Each recipient of rights in the rights offering should consult the recipient&#8217;s own tax advisor with respect to the tax consequences of the rights offering and the related share issuances that may result from such recipient&#8217;s particular circumstances.</font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">42</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Taxation of Subscription Rights</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Receipt of Subscription Rights</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Your receipt of subscription rights pursuant to the rights offering will not be treated as a taxable distribution with respect to your existing shares of common stock for U.S. federal income tax purposes.  Under Section 305 of the Code, a shareholder who receives a right to acquire shares will, in certain circumstances, be treated as having received a taxable dividend in an amount equal to the value of such right.  A common shareholder who receives a right to acquire shares of common stock generally will be treated as having received a taxable dividend if such shareholder&#8217;s proportionate interest in the earnings and profits or assets of the corporation is increased and any other shareholder receives a distribution of cash or other property.  A common shareholder who receives a right to acquire shares of common stock will be treated as having received a taxable dividend if the distribution is treated as part of a &#8220;disproportionate distribution.&#8221;  A disproportionate distribution of stock or stock rights occurs when a distribution (or series of distributions) from a corporation results in (a) an increase in the shareholder&#8217;s proportionate interest in the earnings and profits or assets of the corporation and (b) the receipt by other shareholders of cash or other property.  For purposes of the above, &#8220;shareholder&#8221; includes holders of warrants, options and convertible securities.  We do not believe, however, that a disproportionate distribution will occur and, therefore, the receipt of subscription rights will not be taxable to a shareholder.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Tax Basis in the Subscription Rights</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If the fair market value of the subscription rights you receive is less than 15% of the fair market value of your existing shares of common stock on the date you receive the subscription rights, the subscription rights will be allocated a zero basis for U.S. federal income tax purposes, unless you elect to allocate your basis in your existing shares of common stock between your existing shares of common stock and the subscription rights in proportion to the relative fair market values of the existing shares of common stock and the subscription rights determined on the date of receipt of the subscription rights. If you choose to allocate basis between your existing shares of common stock and the subscription rights, you must make this election on a statement included with your tax return for the taxable year in which you receive the subscription rights.  Such an election is irrevocable.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">However, if the fair market value of the subscription rights you receive is 15% or more of the fair market value of your existing shares of common stock on the date you receive the subscription rights, then you must allocate your basis in your existing shares of common stock between your existing shares of common stock and the subscription rights you receive in proportion to their fair market values determined on the date you receive the subscription rights.  The fair market value of the subscription rights on the date the subscription rights will be distributed is uncertain. In determining the fair market value of the subscription rights, you should consider all relevant facts and circumstances, including the trading price thereof.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Exercise of Subscription Rights</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">You will not recognize gain or loss on the exercise of a subscription right.  Your tax basis in a new share of common stock acquired when you exercise a subscription right will be equal to your adjusted tax basis in the subscription right, if any, plus the subscription price.  The holding period of a share of common stock acquired when you exercise your subscription rights will begin on the date of exercise.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Expiration of Subscription Rights</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you allow subscription rights received in the rights offering to expire, you will not recognize any gain or loss for U.S. federal income tax purposes, and you will re-allocate any portion of the tax basis in your existing shares of common stock previously allocated to the subscription rights that have expired to the existing shares of common stock.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Taxation of Shares of Common Stock Acquired upon Exercise of Subscription Rights</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Distributions</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Distributions with respect to shares of common stock acquired upon exercise of subscription rights will be taxable as dividend income when actually or constructively received to the extent of our current or accumulated earnings and profits as determined for U.S. federal income tax purposes.  To the extent that the amount of a distribution exceeds our current and accumulated earnings and profits, such distribution will be treated first as a tax-free return of capital to the extent of your adjusted tax basis in such shares of common stock and thereafter as capital gain.</font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">43</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Dispositions</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">If you sell or otherwise dispose of the shares of common stock acquired upon exercise of the subscription rights, you will generally recognize capital gain or loss equal to the difference between the amount realized and your adjusted tax basis in the shares of common stock.  Such capital gain or loss will be long-term capital gain or loss if your holding period for the shares of common stock is more than one year. Long-term capital gain of an individual is generally taxed at favorable rates.  The deductibility of capital losses is subject to limitations.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Recent Legislation Relating to Foreign Accounts</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Recently enacted legislation may impose withholding taxes on certain types of payments made to &#8220;foreign financial institutions&#8221; and certain other non-U.S. entities.  The legislation imposes a 30% withholding tax on dividends paid after December 31, 2013 on, or gross proceeds paid after December 31, 2014 from the sale or other disposition of, our common stock paid to a foreign financial institution unless the foreign financial institution enters into an agreement with the U.S. Treasury to among other things, undertake to identify accounts held by certain U.S. persons or U.S.-owned foreign entities, annually report certain information about such accounts and withhold 30% on payments to account holders whose actions prevent it from complying with these reporting and other requirements.  In addition, the legislation imposes a 30% withholding tax on the same types of payments to a foreign non-financial entity unless the entity certifies that it does not have any substantial U.S. owners or furnishes identifying information regarding each substantial U.S. owner. Holders should consult their tax advisors regarding this legislation.</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Health Care and Education Reconciliation Act of 2010</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On March 30, 2010, President Obama signed into law the Health Care and Reconciliation Act of 2010, which requires certain U.S. shareholders who are individuals, estates or trusts to pay a 3.8% tax on, among other things, dividends on and capital gains from the sale or other disposition of stock for taxable years beginning after December 31, 2012.  Holders should consult their tax advisors regarding the effect, if any, of this legislation on their ownership and disposition of our common stock.</font></div><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Information Reporting and Backup Withholding</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Payments made to you of proceeds from the sale of the shares of common stock acquired upon exercise of the subscription rights may be subject to information reporting and/or backup withholding with respect to dividend payments on or the gross proceeds from the disposition of our common stock acquired through the exercise of subscription rights.  Backup withholding may apply under certain circumstances if you (1) fail to furnish your social security or other taxpayer identification number (&#8220;TIN&#8221;), (2) furnish an incorrect TIN, (3) fail to report interest or dividends properly, or (4) fail to provide a certified statement, signed under penalty of perjury, that the TIN provided is correct, that you are not subject to backup withholding and that you are a U.S. person. Any amount withheld from a payment under the backup withholding rules is allowable as a credit against (and may entitle you to a refund with respect to) your U.S. federal income tax liability, provided that the required information is furnished to the IRS. Certain persons are exempt from backup withholding, including corporations and financial institutions.  You are urged to consult your own tax advisor as to your qualification for exemption from backup withholding and the procedure for obtaining such exemption.</font></div><a name="sCB20414F195FA406087F8B32D5AE9E1B"></a><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">LEGAL MATTERS</font></div><div style="line-height:120%;padding-bottom:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Certain legal matters with respect to this rights offering will be passed upon for us by Bryan Cave LLP, Atlanta, Georgia.  Certain legal matters with respect to this rights offering will be passed upon for the dealer manager by Alston &amp; Bird LLP, Atlanta, Georgia.  </font></div><a name="s55B2E902254E29BE47FB8B32D5CE2BBE"></a><div style="line-height:120%;padding-bottom:8px;padding-top:16px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">EXPERTS</font></div><div style="line-height:120%;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Our consolidated financial statements as incorporated in this prospectus by reference to the Annual Report on Form 10-K for the years ended December 31, 2012 and 2011 and for each of the years in the two-year period ended December 31, 2012 have been so incorporated in reliance on the report of Crowe Horwath LLP, independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.</font></div><div style="line-height:120%;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">44</font></div></div><hr style="page-break-after:always"><div></div><br><div style="line-height:120%;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Our consolidated financial statements for the year ended December 31, 2010 have been incorporated by reference in this prospectus in reliance upon the report of Joseph Decosimo and Company, PLLC, an independent registered public accounting firm, incorporated by reference herein and therein, and upon the authority of said firm as experts in accounting and auditing.</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">45</font></div></div><hr style="page-break-after:always"><a name="s5CF2033842478845D4A28B32D5FC6B17"></a><div><div style="line-height:120%;padding-bottom:13px;padding-top:13px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><br><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:16pt;"><font style="font-family:inherit;font-size:16pt;font-weight:bold;">Up to 3,329,234 Shares</font></div><div style="line-height:120%;text-align:center;font-size:14pt;"><font style="font-family:inherit;font-size:14pt;font-weight:bold;">Common Stock</font></div><div style="line-height:120%;text-align:center;font-size:16pt;"><font style="font-family:inherit;font-size:16pt;"><br></font></div><div style="line-height:100%;text-align:center;font-size:5pt;"><font style="font-family:inherit;font-size:5pt;"><br></font></div><div style="line-height:120%;text-align:center;"><img src="fsg2013rightsoffering_image1.jpg" style="height:106px;width:350px;"></div><div style="line-height:120%;text-align:center;font-size:18pt;"><font style="font-family:inherit;font-size:18pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:center;padding-left:228px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">PROSPECTUS</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:16pt;"><font style="font-family:inherit;font-size:16pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:16pt;"><font style="font-family:inherit;font-size:16pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:16pt;"><font style="font-family:inherit;font-size:16pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:16pt;"><font style="font-family:inherit;font-size:16pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:16pt;"><font style="font-family:inherit;font-size:16pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:16pt;"><font style="font-family:inherit;font-size:16pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:16pt;"><font style="font-family:inherit;font-size:16pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:16pt;"><font style="font-family:inherit;font-size:16pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:16pt;"><font style="font-family:inherit;font-size:16pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:16pt;"><font style="font-family:inherit;font-size:16pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:16pt;"><font style="font-family:inherit;font-size:16pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:16pt;"><font style="font-family:inherit;font-size:16pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:16pt;"><font style="font-family:inherit;font-size:16pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:14pt;"><font style="font-family:inherit;font-size:14pt;font-weight:bold;">_________________, 2013</font></div><br><div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><hr style="page-break-after:always"><a name="s8E206418BE6B2B44021A8B32D61C52CD"></a><div><div style="line-height:120%;padding-bottom:13px;padding-top:13px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><br><div style="line-height:120%;padding-bottom:16px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">PART II</font></div><div style="line-height:120%;padding-bottom:16px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">INFORMATION NOT REQUIRED IN PROSPECTUS</font></div><div style="line-height:120%;padding-bottom:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Item 13.&#160;&#160;&#160;&#160;Expenses of Issuance and Distribution.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The following table sets forth the costs and expenses, other than dealer manager fees, payable by us in connection with the sale of the common stock being registered.  All amounts are estimated except the SEC registration fee, the FINRA filing fee and the NASDAQ Capital Market listing of additional shares fee. </font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><div style="padding-left:0px;text-indent:0px;line-height:normal;padding-top:10px;"><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman;font-size:10pt;margin-left:auto;margin-right:auto;width:100%;border-collapse:collapse;text-align:left;"><tr><td colspan="2"></td></tr><tr><td width="83%"></td><td width="17%"></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">SEC registration fee</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="padding-bottom:6px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">$ 681</font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">FINRA filing fee</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">*</font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">NASDAQ Capital Market listing fee</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">*</font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Printing, postage and mailing</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">*</font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Legal fees and expenses</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">*</font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Accounting fees and expenses</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">*</font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Blue Sky fees and expenses</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">*</font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Transfer agent and registrar fees and expenses</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">*</font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Miscellaneous fees and expenses</font></div></td><td style="vertical-align:top;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">*</font></div></td></tr><tr><td style="vertical-align:top;background-color:;padding-left:2px;padding-top:6px;padding-bottom:6px;padding-right:2px;"><div style="text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">TOTAL</font></div></td><td style="vertical-align:bottom;padding-left:2px;padding-top:2px;padding-bottom:2px;padding-right:2px;"><div style="padding-bottom:6px;padding-top:6px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">$225,000</font></div></td></tr></table></div></div><div style="line-height:120%;padding-top:8px;text-align:left;padding-left:36px;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;">____________________</font></div><div style="line-height:120%;padding-top:8px;text-align:left;padding-left:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">*&#160;&#160;&#160;&#160;To be supplied by Amendment.</font></div><div style="line-height:120%;padding-bottom:16px;padding-top:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Item 14.&#160;&#160;&#160;&#160;Indemnification of Directors and Officers.</font></div><div style="line-height:120%;padding-bottom:16px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Tennessee Business Corporation Act provides that a corporation may indemnify any of its directors and officers against liability incurred in connection with a proceeding if (i) the director or officer acted in good faith, (ii)&#160;in the case of conduct in his or her official capacity with the corporation, the director or officer reasonably believed such conduct was in the corporation's best interest, (iii) in all other cases, the director or officer reasonably believed that his or her conduct was not opposed to the best interest of the corporation, and (iv) in connection with any criminal proceeding, the director or officer had no reasonable cause to believe that his or her conduct was unlawful. In actions brought by or in the right of the corporation, however, the Tennessee Business Corporation Act provides that no indemnification may be made if the director or officer was adjudged to be liable to the corporation.  In cases where the director or officer is wholly successful, on the merits or otherwise, in the defense of any proceeding instigated because of his or her status as an officer or director of a corporation, the Tennessee Business Corporation Act mandates that the corporation indemnify the director or officer against reasonable expenses incurred in the proceeding.  The Tennessee Business Corporation Act also provides that in connection with any proceeding charging improper personal benefit to an officer or director, no indemnification may be made if such officer or director is adjudged liable on the basis that personal benefit was improperly received. Notwithstanding the foregoing, the Tennessee Business Corporation Act provides that a court of competent jurisdiction, upon application, may order that an officer or director be indemnified for reasonable expenses if, in consideration of all relevant circumstances, the court determines that such individual is fairly and reasonably entitled to indemnification, notwithstanding the fact that (i) such officer or director was adjudged liable to the corporation in a proceeding by or in right of the corporation, (ii) such officer or director was adjudged liable on the basis that personal benefit was improperly received by him; or (iii) such officer or director breached his duty of care to the corporation.</font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">II-</font><font style="font-family:inherit;font-size:10pt;">1</font></div></div><hr style="page-break-after:always"><a name="s8E206418BE6B2B44021A8B32D61C52CD"></a><div><div style="line-height:120%;padding-bottom:13px;padding-top:13px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><br><div style="line-height:120%;padding-bottom:16px;text-align:left;text-indent:36px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Bylaws provide that no director shall be personally liable to First Security or its shareholders for monetary damages for breach of any fiduciary duty as a director except for liability for (i) any breach of the director's duty of loyalty, (ii) acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) for the types of liability set forth in Section 48-18-304 of the Tennessee Business Corporation Act, which provides that directors who vote for unlawful distributions of corporate funds will be held personally liable to the corporation for the amount of any such distribution, or (iv) for any act or omission occurring before the effective date of the Articles of Incorporation.</font></div><div style="line-height:120%;padding-bottom:16px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Item 15. &#160;&#160;&#160;&#160;Recent Sales of Unregistered Securities.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:46px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On February 25, 2013, the Company entered into an Exchange Agreement with Treasury, which held 33,000 shares of the Company's TARP Preferred Stock and the TARP Warrant to purchase 82,363 shares of the Company's common stock.  The Exchange Agreement required Treasury to exchange the TARP Preferred Stock and the TARP Warrant for the Converted Shares, which represented the number of shares of common stock that, based on a price per share equal to the Purchase Price, represented a discount of 73.25% of the aggregate liquidation amount of the TARP Preferred Stock plus 100% of the accrued but unpaid dividends thereon through the TARP Closing Date.  Accordingly, on April 11, 2013, the Company issued 9,941,908 shares of common stock to Treasury.  Immediately following the issuance of the Converted Shares to Treasury, Treasury sold the Converted Shares to certain investors identified by the Company at the Purchase Price pursuant to TARP Securities Purchase Agreements between such investors, Treasury and the Company.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">On February 25, 2013, the Company entered into Stock Purchase Agreements with certain institutional investors, including affiliates of EJF, GF Financial, MFP, Ulysses and the other investors named therein (collectively, the &#8220;Investors&#8221;), whereby EJF, GF Financial, MFP and Ulysses each agreed to purchase approximately $9.0 million of common stock at the Purchase Price.  In aggregate, the Company executed a Stock Purchase Agreement with Investors to purchase approximately $91.1 million of common stock.  The Stock Purchase Agreement provides that the Company could direct each Investor to purchase all or part of such Investor's committed investment from Treasury.  Investors purchased shares remaining from their committed investment directly from the Company. </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The Local Investors executed Subscription Agreements, pursuant to which they committed to purchase shares of common stock for the Purchase Price.  The Subscription Agreements provided that the Company could direct each Local Investor to purchase all or a portion of such Local Investor's committed investment from Treasury.</font></div><div style="line-height:120%;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In aggregate, the Investors and Local Investors agreed to purchase approximately $91.1 million of common stock at $1.50 per share.  Accordingly, Investors and Local Investors purchased 9,941,908 shares from Treasury on April 11, 2013, and, on April 12, 2013, the Company sold 50,793,092 shares of common stock to the Investors and the Local Investors.</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Pursuant to the Stock Purchase Agreement, 60,735,000 shares of our common stock sold in the Recapitalization have been registered for resale on a registration statement on Form S-1 (File No. 333-188137) that was declared effective by the SEC on June 6, 2013.  The investors in our Recapitalization are no longer subject to any lock-up agreements or any other contractual agreements not to dispose of our shares and these shares are freely transferable. </font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The issuance of securities pursuant to the transactions described above were private placements to &#8220;accredited investors&#8221; (as that term is defined under Rule 501 of Regulation D), and were therefore exempt from registration under the Securities Act, in reliance upon Section 4(a)(2) of the Securities Act and Regulation D Rule 506, as a transaction by an issuer not involving a public offering. </font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">II-2</font></div></div><hr style="page-break-after:always"><a name="s8E206418BE6B2B44021A8B32D61C52CD"></a><div><div style="line-height:120%;padding-bottom:13px;padding-top:13px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><br><div style="line-height:120%;padding-bottom:16px;text-align:left;font-size:10.5pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Item 16.&#160;&#160;&#160;&#160;Exhibits</font><font style="font-family:inherit;font-size:10.5pt;">&#32;</font></div><div style="line-height:120%;text-align:left;padding-left:72px;text-indent:-72px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Exhibit</font></div><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman; 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font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">3.2</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Amended and Restated Bylaws. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(1)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">4.1</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Common Stock Certificate. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(2)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">4.2</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Tax Benefit Preservation Plan, dated October 30, 2012. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(3)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">4.3**</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Rights Certificate.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">5.1**</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of opinion of Bryan Cave LLP.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.1*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">First Security&#8217;s Second Amended and Restated 1999 Long-Term Incentive Plan. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(2)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.2*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">First Security&#8217;s Amended and Restated 2002 Long-Term Incentive Plan. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(4)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.3*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Incentive Stock Option Award under the Second Amended and Restated 1999 Long-Term Incentive Plan. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(5)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.4*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Incentive Stock Option Award under the 2002 Long-Term Incentive Plan. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(5)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.5*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Non-qualified Stock Option Award under the 2002 Long-Term Incentive Plan. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(5)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.6*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Restricted Stock Award under the 2002 Long-Term Incentive Plan. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(5)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.7*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Restricted Stock Award under the 2002 Long-Term Incentive Plan with TARP restrictions. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(6)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.8*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Employment Agreement Dated as of May 16, 2003 by and between First Security and Rodger B. Holley. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(7)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.9*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Salary Continuation Agreement Dated as of December 21, 2005 by and between First Security, FSGBank and Rodger B. Holley.</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt"> (8)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.10*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Employment Agreement Dated as of September 20, 2010 and Executed November 24, 2010 by and between First Security and Ralph E. &#8220;Gene&#8221; Coffman, Jr. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(9)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.11*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Employment Agreement Dated as of May 16, 2003 by and between First Security and William L. Lusk, Jr. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(7)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.12*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Salary Continuation Agreement Dated as of December 21, 2005 by and between First Security, FSGBank and William L. Lusk, Jr. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(8)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.13*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">First Security Group, Inc. Non-Employee Director Compensation Policy. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(8)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.14*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of First Amendment to Employment Agreements, Dated as of December 18, 2008 (executed by Messrs. Holley and Lusk). </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(8)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.15*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Senior Executive Officer Agreement, Dated as of January 9, 2009 (executed by Messrs. Holley and Lusk).</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt"> (11)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.16</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Letter Agreement, Dated January 9, 2009, including Securities Purchase Agreement&#8212;Standard Terms, incorporated by reference therein, between the Company and the United States Department of the Treasury. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(11)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.17*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of TARP Restricted Employee Agreement, Dated as of December 10, 2009 (executed by Messrs. Holley and Lusk). </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(12)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.18</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Consent Order, Dated April 28, 2010, between FSGBank and the Office of the Comptroller of the Currency. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(13)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.19</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Stipulation and Consent to the Issuance of a Consent Order, Dated April 28, 2010, between FSGBank and the Office of the Comptroller of the Currency. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(13)</sup>&#160;</font></div></td></tr></table><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">II-3</font></div></div><hr style="page-break-after:always"><a name="s8E206418BE6B2B44021A8B32D61C52CD"></a><div><div style="line-height:120%;padding-bottom:13px;padding-top:13px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><br><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.20</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Written Agreement, Dated September 7, 2010, between First Security Group, Inc. and the Federal Reserve Bank of Atlanta. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(14)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.21</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Resignation Letter of Rodger B. Holley, dated April 21, 2011. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(15)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.22</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Severance Agreement by and between Rodger B. Holley, First Security Group, Inc. and FSGBank, N.A., dated April 21, 2011. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(15)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.23</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Engagement Agreement with First Security Group, Inc., FSGBank, N.A. and Triumph Investment Management, LLC, dated April 28, 2011. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(16)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.24</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Amendment to Engagement Agreement with First Security Group, Inc., FSGBank, N.A. and Triumph Investment Management, LLC, dated March 28, 2012. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(17)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.25</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Employment Agreement by and between D. Michael Kramer, First Security Group, Inc. and FSGBank, N.A., dated December 28, 2011. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(18)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.26</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Exchange Agreement by and between First Security Group, Inc. and The United States Department of The Treasury, dated February 25, 2013. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(19)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.27</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Stock Purchase Agreement by and between First Security Group, Inc. and certain Named Investors, dated February 25, 2013. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(19)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.28</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Securities Purchase Agreement by and between The United States Department of The Treasury and First Security Group, Inc., dated February 25, 2013. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(19)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.29*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">First Security Group, Inc., 2012 Long-Term Incentive Plan. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(20)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.30*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Incentive Stock Option Award under the 2012 Long-Term Incentive Plan. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(21)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.31*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Non-qualified Stock Option Award under the 2012 Long-Term Incentive Plan. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(21)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.32*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Restricted Stock Award for a Director under the 2012 Long-Term Incentive Plan with TARP restrictions. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(21)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.33*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Restricted Stock Award for an Employee under the 2012 Long-Term Incentive Plan with TARP restrictions. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(21)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.34**</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Dealer Manager Agreement. </font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">21.1</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Subsidiaries of the Registrant. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(1)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">23.1</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Consent of Crowe Horwath LLP.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">23.2</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Consent of Joseph Decosimo and Company, PLLC.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">23.3**</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Consent of Bryan Cave LLP (see Exhibit 5.1 to this Registration Statement)</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">24</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Power of Attorney (contained on the Signature Page).</font></div></td></tr></table><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">99.1**&#160;&#160;&#160;&#160;Form of Instruction as to Use of Rights Certificates.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">99.2**&#160;&#160;&#160;&#160;Form of Letter to Shareholders who are Record Holders.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">99.3**&#160;&#160;&#160;&#160;Form of Letter to Shareholders who are Dealers/Nominees.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">99.4**&#160;&#160;&#160;&#160;Form of Letter to Clients who are Beneficial Holders.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">99.5**&#160;&#160;&#160;&#160;Form of Nominee Holder Certification.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">99.6**&#160;&#160;&#160;&#160;Form of Beneficial Owner Election Form.</font></div><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">99.7**</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Separate Instruction Letter for Participants in the First Security Group, Inc. 401(k) and Employee Stock Ownership Plan.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">101</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Interactive Data Files providing financial information from the Registrant&#8217;s Annual Report on Form 10-K for the year ended December 31, 2012 in XBRL (eXtensible Business Reporting Language).  Pursuant to Regulation 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Section 11 or 12 of the Securities Act of 1933, </font></div></td></tr></table><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">II-4</font></div></div><hr style="page-break-after:always"><a name="s8E206418BE6B2B44021A8B32D61C52CD"></a><div><div style="line-height:120%;padding-bottom:13px;padding-top:13px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><br><div style="line-height:120%;padding-left:72px;padding-bottom:6px;padding-top:6px;text-align:left;"><font style="font-family:inherit;font-size:10pt;">as amended, or Section 18 of the Securities Exchange Act of 1934, as amended, and are otherwise not subject to liability. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(21)</sup>&#160;</font></div><div style="line-height:120%;text-indent:96px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font></div><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">The indicated exhibit is a compensatory plan.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">**</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">To be filed by amendment.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">1</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security&#8217;s Registration Statement on Form S-1 dated April 25, 2013, File No. 333-188137.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">2</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security&#8217;s Registration Statement on Form S-1 dated April 20, 2001, File No. 333-59338.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">3</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security&#8217;s Current Report on Form 8-K filed October 30, 2012.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">4</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference from Appendix A to First Security&#8217;s Proxy Statement filed April 30, 2007.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">5</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security&#8217;s Annual Report on Form 10-K for the year ended December 31, 2004.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">6</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security&#8217;s Annual Report on Form 10-K for the year ended December 31, 2010.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">7</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security&#8217;s Quarterly Report on Form 10-Q for the period ended June 30, 2003.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">8</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security&#8217;s Annual Report on Form 10-K for the year ended December 31, 2005.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">9</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security's Current Report on Form 8-K filed December 1, 2010.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">10</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security&#8217;s Annual Report on Form 10-K for the year ended December 31, 2008.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">11</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security's Current Report on Form 8-K filed January 9, 2009.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">12</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security&#8217;s Annual Report on Form 10-K for the year ended December 31, 2009.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">13</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security's Current Report on Form 8-K filed April 29, 2010.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">14</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security's Current Report on Form 8-K filed September 14, 2010.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">15</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security's Current Report on Form 8-K filed April 27, 2011.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">16</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security's Current Report on Form 8-K filed April 29, 2011.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">17</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security&#8217;s Annual Report on Form 10-K for the year ended December 31, 2011.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">18</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security's Current Report on Form 8-K filed December 29, 2011.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">19</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security's Current Report on Form 8-K filed February 26, 2013.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">20</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference from Appendix A to First Security's Proxy Statement filed May 1, 2012.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">21</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security&#8217;s Annual Report on Form 10-K for the year ended December 31, 2012.</font></div></td></tr></table><div style="line-height:120%;padding-bottom:16px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;padding-bottom:16px;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Item 17.&#160;&#160;&#160;&#160;Undertakings.</font></div><div style="line-height:120%;padding-bottom:16px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;"></font><font style="font-family:inherit;font-size:10pt;">The undersigned registrant hereby undertakes:</font></div><div style="line-height:120%;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><table cellpadding="0" cellspacing="0" style="padding-top:8px;padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;">(a)</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:96px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:72px;"><font style="font-family:inherit;font-size:10pt;">(i)</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">to include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:96px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:72px;"><font style="font-family:inherit;font-size:10pt;">(ii)</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">to reflect in the prospectus any facts or events arising after the effective date of this registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in </font></div></td></tr></table><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">II-5</font></div></div><hr style="page-break-after:always"><a name="s8E206418BE6B2B44021A8B32D61C52CD"></a><div><div style="line-height:120%;padding-bottom:13px;padding-top:13px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><br><div style="line-height:120%;padding-left:96px;padding-bottom:8px;padding-top:8px;text-align:left;"><font style="font-family:inherit;font-size:10pt;">the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the &#8220;Calculation of Registration Fee&#8221; table in the effective registration statement; and</font></div><table cellpadding="0" cellspacing="0" style="padding-top:8px;padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:96px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:72px;"><font style="font-family:inherit;font-size:10pt;">(iii)</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;">(b)</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;">(c)</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;">(d)</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser:</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:96px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:72px;"><font style="font-family:inherit;font-size:10pt;">(i)</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:96px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:72px;"><font style="font-family:inherit;font-size:10pt;">(ii)</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information required by section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof; provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;">(e)</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities, the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:96px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:72px;"><font style="font-family:inherit;font-size:10pt;">(i)</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:96px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:72px;"><font style="font-family:inherit;font-size:10pt;">(ii)</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:96px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:72px;"><font style="font-family:inherit;font-size:10pt;">(iii)</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:96px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:72px;"><font style="font-family:inherit;font-size:10pt;">(iv)</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.</font></div></td></tr></table><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">II-6</font></div></div><hr style="page-break-after:always"><a name="s8E206418BE6B2B44021A8B32D61C52CD"></a><div><div style="line-height:120%;padding-bottom:13px;padding-top:13px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><br><table cellpadding="0" cellspacing="0" style="padding-top:8px;padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;">(f)</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other that the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit of proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act of 1933 and will be governed by the final adjudication of such issue.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:48px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:24px;"><font style="font-family:inherit;font-size:10pt;">(g)</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The undersigned registrant hereby undertakes that:</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:96px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:72px;"><font style="font-family:inherit;font-size:10pt;">(i)</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b) (1) or (4) or 497(h) under the Securities Act of 1933 shall be deemed to be part of this registration statement as of the time it was declared effective.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:8px;padding-bottom:8px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:96px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:72px;"><font style="font-family:inherit;font-size:10pt;">(ii)</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">For the purpose of determining any liability under the Securities Act of 1933 each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.</font></div></td></tr></table><div style="line-height:120%;padding-bottom:8px;padding-top:8px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">&#160;&#160;&#160;&#160;</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">II-7</font></div></div><hr style="page-break-after:always"><a name="s8937F945761FE9ACFFC38B32D65A9C8A"></a><div><div style="line-height:120%;padding-bottom:13px;padding-top:13px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><br><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">SIGNATURES</font></div><div style="line-height:120%;text-align:left;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;"><br></font></div><div style="line-height:120%;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Chattanooga, State of Tennessee, on July 3, 2013. </font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:justify;text-indent:300px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">FIRST SECURITY GROUP, INC.</font></div><div style="line-height:120%;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:justify;text-indent:300px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">By:&#160;&#160;&#160;&#160;</font><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#32;/s/ D. Michael Kramer&#160;&#160;&#160;&#160;</font></div><div style="line-height:120%;text-align:justify;text-indent:324px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">D. Michael Kramer</font></div><div style="line-height:120%;text-align:justify;text-indent:324px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">President and Chief Executive Officer</font></div><div style="line-height:120%;text-align:left;padding-left:288px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">POWER OF ATTORNEY </font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">KNOW ALL MEN BY THESE PRESENTS, that each of the persons whose signature appears below appoints and constitutes D. Michael Kramer and John R. Haddock and each of them, his or her true and lawful attorney-in-fact and agent, each acting alone, with full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to execute any and all amendments (including post-effective amendments) to the within registration statement (as well as any registration statement for the same offering covered by this registration statement that is to be effective upon filing pursuant to Rule 462(b) under the Securities Act of 1933), and to file the same, together with all exhibits thereto and all other documents in connection therewith, with the Securities and Exchange Commission and such other agencies, offices and persons as may be required by applicable law, granting unto each said attorney-in-fact and agent, each acting alone, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that each said attorney-in-fact and agent, each acting alone may lawfully do or cause to be done by virtue hereof.</font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities on July 3, 2013.</font></div><div style="line-height:120%;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:9.5pt;"><font style="font-family:inherit;font-size:9.5pt;font-weight:bold;">Name&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Title</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#32;/s/ D. Michael Kramer&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font><font style="font-family:inherit;font-size:10pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;President and Chief Executive Officer and Director</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">D. Michael Kramer</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">(Principal Executive Officer)</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#32;/s/ John R. Haddock&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font><font style="font-family:inherit;font-size:10pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Executive Vice President and Chief Financial Officer</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">John R. Haddock</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">(Principal Financial and Accounting Officer)</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#32;/s/ Larry D. Mauldin&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font><font style="font-family:inherit;font-size:10pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Chairman of the Board and Director</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Larry D. Mauldin&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#32;/s/ Henchy R. Enden&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font><font style="font-family:inherit;font-size:10pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Director</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Henchy R. Enden</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#32;/s/ William F. Grant, III&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font><font style="font-family:inherit;font-size:10pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Director</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">William F. Grant, III</font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">II-</font><font style="font-family:inherit;font-size:10pt;">8</font></div></div><hr style="page-break-after:always"><a name="s8937F945761FE9ACFFC38B32D65A9C8A"></a><div><div style="line-height:120%;padding-bottom:13px;padding-top:13px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><br><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#32;/s/ William C. Hall&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font><font style="font-family:inherit;font-size:10pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Director</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">William C. Hall</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#32;/s/ Adam G. Hurwich&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font><font style="font-family:inherit;font-size:10pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Director</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Adam G. Hurwich</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#32;/s/ Carol H. Jackson&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font><font style="font-family:inherit;font-size:10pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Director</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Carol H. Jackson</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#32;/s/ Kelly P. Kirkland&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font><font style="font-family:inherit;font-size:10pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Director</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Kelly P. Kirkland</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#32;/s/ Robert R. Lane&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font><font style="font-family:inherit;font-size:10pt;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Director</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Robert R. Lane</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">II-9</font></div></div><hr style="page-break-after:always"><a name="s804FE2F9B240DFFC963C8B32D679CB77"></a><div><div style="line-height:120%;padding-bottom:13px;padding-top:13px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><br><div style="line-height:120%;text-align:center;font-size:11pt;"><font style="font-family:inherit;font-size:11pt;font-weight:bold;">EXHIBIT INDEX</font></div><div style="line-height:120%;text-align:justify;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><div style="line-height:120%;text-align:left;padding-left:72px;text-indent:-72px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Exhibit</font></div><table cellpadding="0" cellspacing="0" style="font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">Number</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">Definition&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">3.1</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Amended and Restated Articles of Incorporation. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(1)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">3.2</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Amended and Restated Bylaws. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(1)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">4.1</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Common Stock Certificate. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(2)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">4.2</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Tax Benefit Preservation Plan, dated October 30, 2012. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(3)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">4.3**</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Rights Certificate.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">5.1**</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of opinion of Bryan Cave LLP.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.1*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">First Security&#8217;s Second Amended and Restated 1999 Long-Term Incentive Plan. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(2)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.2*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">First Security&#8217;s Amended and Restated 2002 Long-Term Incentive Plan. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(4)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.3*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Incentive Stock Option Award under the Second Amended and Restated 1999 Long-Term Incentive Plan. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(5)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.4*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Incentive Stock Option Award under the 2002 Long-Term Incentive Plan. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(5)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.5*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Non-qualified Stock Option Award under the 2002 Long-Term Incentive Plan. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(5)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.6*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Restricted Stock Award under the 2002 Long-Term Incentive Plan. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(5)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.7*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Restricted Stock Award under the 2002 Long-Term Incentive Plan with TARP restrictions. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(6)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.8*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Employment Agreement Dated as of May 16, 2003 by and between First Security and Rodger B. Holley. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(7)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.9*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Salary Continuation Agreement Dated as of December 21, 2005 by and between First Security, FSGBank and Rodger B. Holley.</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt"> (8)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.10*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Employment Agreement Dated as of September 20, 2010 and Executed November 24, 2010 by and between First Security and Ralph E. &#8220;Gene&#8221; Coffman, Jr. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(9)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.11*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Employment Agreement Dated as of May 16, 2003 by and between First Security and William L. Lusk, Jr. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(7)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.12*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Salary Continuation Agreement Dated as of December 21, 2005 by and between First Security, FSGBank and William L. Lusk, Jr. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(8)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.13*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">First Security Group, Inc. Non-Employee Director Compensation Policy. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(8)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.14*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of First Amendment to Employment Agreements, Dated as of December 18, 2008 (executed by Messrs. Holley and Lusk). </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(8)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.15*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Senior Executive Officer Agreement, Dated as of January 9, 2009 (executed by Messrs. Holley and Lusk).</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt"> (11)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.16</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Letter Agreement, Dated January 9, 2009, including Securities Purchase Agreement&#8212;Standard Terms, incorporated by reference therein, between the Company and the United States Department of the Treasury. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(11)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.17*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of TARP Restricted Employee Agreement, Dated as of December 10, 2009 (executed by Messrs. Holley and Lusk). </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(12)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.18</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Consent Order, Dated April 28, 2010, between FSGBank and the Office of the Comptroller of the Currency. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(13)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.19</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Stipulation and Consent to the Issuance of a Consent Order, Dated April 28, 2010, between FSGBank and the Office of the Comptroller of the Currency. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(13)</sup>&#160;</font></div></td></tr></table><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">II-</font><font style="font-family:inherit;font-size:10pt;">10</font></div></div><hr style="page-break-after:always"><a name="s804FE2F9B240DFFC963C8B32D679CB77"></a><div><div style="line-height:120%;padding-bottom:13px;padding-top:13px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><br><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.20</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Written Agreement, Dated September 7, 2010, between First Security Group, Inc. and the Federal Reserve Bank of Atlanta. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(14)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.21</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Resignation Letter of Rodger B. Holley, dated April 21, 2011. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(15)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.22</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Severance Agreement by and between Rodger B. Holley, First Security Group, Inc. and FSGBank, N.A., dated April 21, 2011. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(15)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.23</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Engagement Agreement with First Security Group, Inc., FSGBank, N.A. and Triumph Investment Management, LLC, dated April 28, 2011. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(16)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.24</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Amendment to Engagement Agreement with First Security Group, Inc., FSGBank, N.A. and Triumph Investment Management, LLC, dated March 28, 2012. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(17)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.25</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Employment Agreement by and between D. Michael Kramer, First Security Group, Inc. and FSGBank, N.A., dated December 28, 2011. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(18)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.26</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Exchange Agreement by and between First Security Group, Inc. and The United States Department of The Treasury, dated February 25, 2013. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(19)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.27</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Stock Purchase Agreement by and between First Security Group, Inc. and certain Named Investors, dated February 25, 2013. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(19)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.28</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Securities Purchase Agreement by and between The United States Department of The Treasury and First Security Group, Inc., dated February 25, 2013. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(19)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.29*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">First Security Group, Inc., 2012 Long-Term Incentive Plan. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(20)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.30*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Incentive Stock Option Award under the 2012 Long-Term Incentive Plan. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(21)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.31*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Non-qualified Stock Option Award under the 2012 Long-Term Incentive Plan. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(21)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.32*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Restricted Stock Award for a Director under the 2012 Long-Term Incentive Plan with TARP restrictions. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(21)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.33*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Restricted Stock Award for an Employee under the 2012 Long-Term Incentive Plan with TARP restrictions. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(21)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">10.34**</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Dealer Manager Agreement. </font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">21.1</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Subsidiaries of the Registrant. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(1)</sup>&#160;</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">23.1</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Consent of Crowe Horwath LLP.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">23.2</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Consent of Joseph Decosimo and Company, PLLC.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">23.3**</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Consent of Bryan Cave LLP (see Exhibit 5.1 to this Registration Statement)</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">24</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Power of Attorney (contained on the Signature Page).</font></div></td></tr></table><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">99.1**&#160;&#160;&#160;&#160;Form of Instruction as to Use of Rights Certificates.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">99.2**&#160;&#160;&#160;&#160;Form of Letter to Shareholders who are Record Holders.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">99.3**&#160;&#160;&#160;&#160;Form of Letter to Shareholders who are Dealers/Nominees.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">99.4**&#160;&#160;&#160;&#160;Form of Letter to Clients who are Beneficial Holders.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">99.5**&#160;&#160;&#160;&#160;Form of Nominee Holder Certification.</font></div><div style="line-height:120%;padding-bottom:6px;padding-top:6px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">99.6**&#160;&#160;&#160;&#160;Form of Beneficial Owner Election Form.</font></div><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">99.7**</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Form of Separate Instruction Letter for Participants in the First Security Group, Inc. 401(k) and Employee Stock Ownership Plan.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:72px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:10pt;padding-left:0px;"><font style="font-family:inherit;font-size:10pt;">101</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Interactive Data Files providing financial information from the Registrant&#8217;s Annual Report on Form 10-K for the year ended December 31, 2012 in XBRL (eXtensible Business Reporting Language).  Pursuant to Regulation 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Section 11 or 12 of the Securities Act of 1933, </font></div></td></tr></table><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">II-11</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><hr style="page-break-after:always"><a name="s804FE2F9B240DFFC963C8B32D679CB77"></a><div><div style="line-height:120%;padding-bottom:13px;padding-top:13px;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div><br><div style="line-height:120%;padding-left:72px;padding-bottom:6px;padding-top:6px;text-align:left;"><font style="font-family:inherit;font-size:10pt;">as amended, or Section 18 of the Securities Exchange Act of 1934, as amended, and are otherwise not subject to liability. </font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">(21)</sup>&#160;</font></div><div style="line-height:120%;text-indent:96px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;text-decoration:underline;">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;</font></div><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">*</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">The indicated exhibit is a compensatory plan.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">**</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">To be filed by amendment.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">1</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security&#8217;s Registration Statement on Form S-1 dated April 25, 2013, File No. 333-188137.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">2</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security&#8217;s Registration Statement on Form S-1 dated April 20, 2001, File No. 333-59338.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">3</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security&#8217;s Current Report on Form 8-K filed October 30, 2012.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">4</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference from Appendix A to First Security&#8217;s Proxy Statement filed April 30, 2007.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">5</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security&#8217;s Annual Report on Form 10-K for the year ended December 31, 2004.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">6</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security&#8217;s Annual Report on Form 10-K for the year ended December 31, 2010.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">7</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security&#8217;s Quarterly Report on Form 10-Q for the period ended June 30, 2003.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">8</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security&#8217;s Annual Report on Form 10-K for the year ended December 31, 2005.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">9</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security's Current Report on Form 8-K filed December 1, 2010.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">10</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security&#8217;s Annual Report on Form 10-K for the year ended December 31, 2008.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">11</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security's Current Report on Form 8-K filed January 9, 2009.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">12</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security&#8217;s Annual Report on Form 10-K for the year ended December 31, 2009.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">13</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security's Current Report on Form 8-K filed April 29, 2010.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">14</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security's Current Report on Form 8-K filed September 14, 2010.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">15</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security's Current Report on Form 8-K filed April 27, 2011.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">16</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security's Current Report on Form 8-K filed April 29, 2011.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">17</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security&#8217;s Annual Report on Form 10-K for the year ended December 31, 2011.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">18</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security's Current Report on Form 8-K filed December 29, 2011.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">19</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference to First Security's Current Report on Form 8-K filed February 26, 2013.</font></div></td></tr></table><table cellpadding="0" cellspacing="0" style="padding-top:6px;padding-bottom:6px;font-family:Times New Roman; font-size:10pt;"><tr><td style="width:30px;"></td><td></td></tr><tr><td style="vertical-align:top"><div style="line-height:120%;font-size:9pt;padding-left:1px;"><font style="font-family:inherit;font-size:9pt;">20</font></div></td><td style="vertical-align:top;"><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">Incorporated by reference from Appendix A to First Security's Proxy Statement filed May 1, 2012.</font></div></td></tr></table><div style="line-height:120%;text-align:left;padding-left:24px;text-indent:-24px;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;">21      Incorporated by reference to First Security&#8217;s Annual Report on Form 10-K for the year ended December 31, 2012.</font></div><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;"><br></font></div><div style="line-height:120%;text-align:left;font-size:9pt;"><font style="font-family:inherit;font-size:9pt;"><br></font></div><div style="line-height:120%;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div><br><div><div style="line-height:120%;text-align:center;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">II-12</font></div><div style="line-height:120%;text-align:left;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;"><br></font></div></div>	</body>
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{"company-data": {"conformed-name": "FIRST SECURITY GROUP INC/TN", "cik": "0001138817", "assigned-sic": "6021", "irs-number": "582461486", "state-of-incorporation": "TN", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "S-1", "act": "33", "file-number": "333-189816", "film-number": "13954470"}, "business-address": {"street1": "531 BROAD STREET", "city": "CHATTANOOGA", "state": "TN", "zip": "37402", "phone": "423-266-2000"}, "mail-address": {"street1": "531 BROAD STREET", "city": "CHATTANOOGA", "state": "TN", "zip": "37402"}}
FSG2013RightsOfferingFormS-1-v4
As filed with the Securities and Exchange Commission
on July 3,
2013
Registration No. __________
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
__________________________________
FIRST SECURITY GROUP, INC.
(Exact name of registrant as specified in its charter)
TENNESSEE
(State or other jurisdiction of incorporation or organization)
6021
(Primary Standard Industrial Classification Number)
58-2461486
(IRS Employer Identification Number)
__________________________________
531 BROAD STREET
CHATTANOOGA, TENNESSEE  37402
(423) 266-2000
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
__________________________________
D. MICHAEL KRAMER
FIRST SECURITY GROUP, INC.
531 BROAD STREET
CHATTANOOGA, TENNESSEE  37402
(423) 266-2000
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copies of Communications to:
Robert D. Klingler
Bryan Cave LLP
One Atlantic Center
Fourteenth Floor
1201 West Peachtree Street, NW
Atlanta, Georgia  30309-3488
(404) 572-6600
Randolph A. Moore III
Alston & Bird LLP
One Atlantic Center
1201 West Peachtree Street, NW
Atlanta, Georgia 30309
(404) 881-7794
__________________________________
Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement.
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box.
x
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.
o
If this Form is a post-effective amendment filed pursuant to Rule 462(c) 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.
o
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.
o
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.
Large accelerated filer
o
Accelerated filer
o
Non-accelerated filer
o
Smaller reporting company
x
CALCULATION OF REGISTRATION FEE
Title of Each Class of Securities to be Registered
(1)
Amount to be Registered
Proposed Maximum Offering
Price Per Share
(2)
Proposed Maximum Aggregate Offering Price
(3)
Amount of Registration Fee
(4)
Non-Transferable Common Stock Subscription Rights
1,664,617
N/A
N/A
$0
Common Stock, par value $0.01 per share
3,329,234
$1.50
$4,993,851
$681
(1)
This registration statement relates to: (a) non-transferable subscription rights to purchase common stock of the Registrant, which subscription rights are to be issued to holders of the Registrant's common stock and (b) the shares of common stock deliverable upon the exercise of the non-transferable subscription rights pursuant to the rights offering.
(2)
Offering price per share is fixed by the Stock Purchase Agreement, dated as of February 25, 2013, by and among the Registrant and each of the investors named therein.
(3)
Includes the gross proceeds from the assumed exercise of all non-transferable subscription rights to be issued.
(4)
The non-transferable subscription rights are being issued without consideration.  Pursuant to Rule 457(g), no separate registration fee is payable with respect to the rights being offered hereby since the rights are being registered in the same registration statement as the securities to be offered pursuant thereto.  Pursuant to Rule 457(p) under the Securities Act, the full amount of the registration fee currently due for this Registration Statement has been offset against part of the remaining unused portion of the $1,491.43 fee paid by the Registrant in connection with the Registration Statement on Form S-3 (No. 333-157196) filed on February 9, 2009.  The securities registered by Registration Statement No. 333-157196 have been removed from registration without having been sold via Post-Effective Amendment No. 1 filed on May 15, 2013.   As a result the unused portion of the registration fee previously paid in connection with the Form S-3 is reduced to $810.43.
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 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.
SUBJECT TO COMPLETION DATED JULY 3, 2013
The information in this preliminary prospectus is not complete and may be changed.  This preliminary prospectus is included in a registration statement that we filed with the Securities and Exchange Commission.  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 these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.
PRELIMINARY PROSPECTUS
Up to 3,329,234 Shares of Common Stock
Issuable upon the exercise of Subscription Rights at $1.50 per share
We are distributing, at no charge to certain shareholders, non-transferable subscription rights to purchase up to 3,329,234 shares of our common stock, $0.01 par value per share (the "rights offering").  Subscription rights will be distributed to persons who owned shares of our common stock as of 5:00 p.m. Eastern Time, on April 10, 2013, the record date of the rights offering.
The exercise of your subscription rights for shares of our common stock involves risks.  Before determining whether to exercise your subscription rights and purchase our common stock, you should carefully read the section titled "
Risk Factors
" beginning on page 15 of this prospectus along with our periodic reports and other information we file with the Securities and Exchange Commission.
Each subscription right will entitle a shareholder to purchase two shares of our common stock at the subscription price of $1.50 per share for each share of common stock owned by such shareholder on the record date, which we refer to as the "basic subscription privilege."  If you fully exercise your basic subscription privilege and other shareholders do not fully exercise their basic subscription privileges, you will be entitled to exercise an "over-subscription privilege," subject to certain limitations and subject to allotment, to purchase a portion of the unsubscribed shares of our common stock at the same subscription price of $1.50 per share.  To the extent you properly exercise your over-subscription privilege for an amount of shares that exceeds the number of the unsubscribed shares available to you, any excess subscription payments received by the subscription agent will be returned to you, without interest, as soon as practicable following the expiration of the rights offering.  Funds we receive from subscribers in the rights offering will be held in escrow by the subscription agent until the rights offering is completed or canceled.
The subscription rights will expire if they are not exercised by 5:00 p.m., East
ern Time, on ___________, 2013.  We reserve the right to extend the expiration date one or more times, but in no event will we extend the rights offering beyond ___________, 2013.  We reserve the right to cancel, at any time, the rights offering. If the rights offering is cancelled, all subscription payments received by the subscription agent will be promptly returned, without interest or penalty.
You should carefully consider whether to exercise your subscription rights prior to the expiration of the rights offering.  All exercises of subscription rights are irrevocable.  Our board of directors is making no recommendation regarding your exercise of the subscription rights.  The subscription rights may not be sold, transferred or assigned and will not be traded on the NASDAQ Capital Market or on any stock exchange or market.  Our common stock is traded on the NASDAQ Capital Market under the trading symbol "FSGI."  The last reported sales price for shares of our common stock on July 2, 2013 was $2.16 per s
hare.
Per Share
Total Offering
Size
Public offering price
$
1.50
$
4,993,851
Maximum dealer management fee
$
0.09
$
299,631
Net proceeds, before expenses, to us
$
1.41
$
4,694,220
This is not an underwritten offering. The dealer manager has agreed to use its reasonable efforts to advise and assist us in our efforts to solicit subscriptions of the subscription rights distributed to holders of our common stock, but the dealer manager is not underwriting the offering and has no obligation to purchase or procure purchases of our common stock offered by this prospectus.  We are offering common stock directly to holders of record on the record date.  See "Plan of Distribution."
These securities are not deposits, savings accounts or other obligations of any bank and are not insured or guaranteed by the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, or any other government agency.  Neither the Securities and Exchange Commission, the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency nor any state securities regulator has approved or disapproved of these securities or determined if this prospectus is accurate or complete. Any representation to the contrary is a criminal offense.
RAYMOND JAMES
(Dealer Manager)
The date of this prospectus is
___________
, 2013.
TABLE OF CONTENTS
Page
ABOUT THIS PROSPECTUS
1
SPECIAL NOTE ABOUT FORWARD-LOOKING STATEMENTS
1
WHERE YOU CAN FIND MORE INFORMATION
3
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
3
QUESTIONS AND ANSWERS RELATING TO THE RIGHTS OFFERING
4
PROSPECTUS SUMMARY
10
RISK FACTORS
15
SUMMARY OF THE RECAPITALIZATION
20
USE OF PROCEEDS
21
CAPITALIZATION
22
MARKET FOR THE COMMON STOCK AND DIVIDEND INFORMATION
23
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
24
SUBSCRIPTIONS BY DIRECTORS AND EXECUTIVE OFFICERS
26
THE RIGHTS OFFERING
27
DESCRIPTION OF CAPITAL STOCK
34
PLAN OF DISTRIBUTION
40
MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES
42
LEGAL MATTERS
44
EXPERTS
44
ABOUT THIS PROSPECTUS
This prospectus incorporates important business and financial information about us that is not included in or delivered with this document.  This information is available without charge upon written or oral request.  See "Where You Can Find More Information" and "Incorporation of Certain Information by Reference."
You should rely only on the information contained in or incorporated by reference into this prospectus. We have not, and nor has our subscription and information agent, Registrar and Transfer Company, authorized anyone to provide you with different information.  The information contained in this prospectus is accurate only as of the date of this prospectus regardless of the time of delivery of this prospectus or any exercise of the subscription rights. Our business, financial condition, results of operations and prospects may have changed since those dates.  We are not making an offer of these securities in any state or jurisdiction where the offer is not permitted.
No action is being taken in any jurisdiction outside the United States to permit a public offering of the common stock or possession or distribution of this prospectus in that jurisdiction.  Persons who come into possession of this prospectus in jurisdictions outside the United States are required to inform themselves about and to observe any restrictions as to this offering and the distribution of this prospectus applicable to those jurisdictions.
Unless this prospectus indicates otherwise or the context otherwise requires, the terms "we," "our," "us," the "Company" or "First Security" as used in this prospectus refer to First Security Group, Inc. and its subsidiaries, including FSGBank, N.A., which we sometimes refer to as "FSGBank."
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus, including information included or incorporated by reference in this prospectus, contains statements which constitute forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act, and which statements are inherently subject to risks and uncertainties.  These statements are based on many assumptions and estimates and are not guarantees of future performance.  Forward looking statements are statements that include projections, predictions, expectations or beliefs about future events or results or otherwise are not statements of historical fact.  Such statements are often characterized by the use of qualifying words (and their derivatives) such as "may," "would," "could," "should," "will," "expect," "anticipate," "predict," "project," "potential," "continue," "assume," "believe," "intend," "plan," "forecast," "goal," "estimate," or other statements concerning opinions or judgments of First Security and its management about future events. Factors that could influence the accuracy of such forward looking statements include, but are not limited to, the financial success or changing strategies of FSGBank's customers or vendors, actions of government regulators, the level of market interest rates, and general economic conditions.
These forward-looking statements involve risks and uncertainties and may not be realized due to a variety of factors.  There can be no assurance that the results, performance or achievements of the Company will not differ materially from those expressed or implied by forward-looking statements.  Factors that could cause actual events or results to differ significantly from those described in the forward-looking statements include, but are not limited to the following:
•
First Security's ability to comply with any requirements imposed on it or FSGBank by their respective regulators, and the potential negative consequences that result;
•
deterioration in the financial condition of borrowers resulting in significant increases in loan losses and provisions for those losses;
•
changes in loan underwriting, credit review or loss reserve policies associated with economic conditions, examination conclusions, or regulatory developments;
•
changes in business policies or practices as a result of the changes in management;
•
the risk that First Security may be required to contribute additional capital to FSGBank in the future to enable it to meet its regulatory capital requirements or otherwise;
•
changes in financial market conditions, either internationally, nationally or locally in areas in which First Security conducts its operations, including, without limitation, reduced rates of business formation and growth, commercial and residential real estate development, and real estate prices;
1
•
the failure of assumptions underlying the establishment of reserves for possible loan losses;
•
changes in accounting principles, policies, and guidelines applicable to bank holding companies and banking;
•
the impacts of renewed regulatory scrutiny on consumer protection and compliance led by the newly created Consumer Financial Protection Bureau;
•
changes in capital standards and asset risk-weighting included in proposed Federal Reserve rules to implement the so-called "Basel III" accords;
•
fluctuations in markets for equity, fixed-income, commercial paper and other securities, which could affect availability, market liquidity levels, and pricing;
•
governmental monetary and fiscal policies including the undetermined effects of the Federal Reserve's "Quantitative Easing" programs, as well as legislative and regulatory changes, including, but not limited to, implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act").
•
changes in political and economic conditions, including the political and economic effects of the current economic downturn and other major developments, including the ongoing war on terrorism, continued tensions in the Middle East, and the ongoing economic challenges facing the European Union and other international markets;
•
the risks of changes in interest rates on the level and composition of deposits, loan demand and the values of loan collateral, securities and interest sensitive assets and liabilities;
•
the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds and other financial institutions operating in our market area and elsewhere, including institutions operating regionally, nationally and internationally, together with such competitors offering banking products and services by mail, telephone and the Internet;
•
the effect of any mergers, acquisitions or other transactions, to which we or FSGBank may from time to time be a party, including, without limitation, our ability to successfully integrate any businesses that we acquire;
•
uncertainty regarding the amount of proceeds received from the rights offering;
•
the effects of the rights offering or the terms thereof on the price of our common stock;
•
our ability to terminate the rights offering; and
•
the other risk factors described under the heading "Risk Factors" in this prospectus or incorporated by reference into this prospectus.
Many of these risks are beyond our ability to control or predict, and you are cautioned not to put undue reliance on such forward-looking statements.  First Security does not intend to update or reissue any forward-looking statements contained in this prospectus as a result of new information or other circumstances that may become known to First Security, and undertakes no obligation to provide any such updates.
All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by this Special Note.
For other factors, risks and uncertainties that could cause our actual results to differ materially from estimates and projections contained in these forward-looking statements, please read the "Risk Factors" section of this prospectus beginning on page 15 and the information contained in the section entitled "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2012 and any risks described in our other filings with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act.
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WHERE YOU CAN FIND MORE INFORMATION
We are subject to the informational requirements of the Exchange Act, and file with the SEC proxy statements, Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.  You may read and copy any document we file at the SEC's public reference room at 100 F Street, NE, Room 1580, Washington, D.C. 20549.  Please call the SEC at 1-800-SEC-0330 for further information on the public reference rooms.  Our SEC filings are also available to the public from the SEC's web site at www.sec.gov or on our website at www.fsgbank.com
.
Information on, or that can be accessible through, our website does not constitute a part of, and is not incorporated by reference in, this prospectus.
This prospectus, which is a part of a registration statement on Form S-1 that we have filed with the SEC under the Securities Act, omits certain information set forth in the registration statement.  Accordingly, for further information, you should refer to the registration statement and its exhibits on file with the SEC.  Furthermore, statements contained in this prospectus concerning any document filed as an exhibit are not necessarily complete and, in each instance, we refer you to the copy of such document filed as an exhibit to the registration statement.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The SEC allows us to incorporate by reference the information we file with it, which means that we can disclose important information to you by referring you to those documents filed separately with the SEC.  The information we incorporate by reference is an important part of this prospectus.  We incorporate by reference the documents listed below, except to the extent that any information contained in those documents is deemed "furnished" in accordance with SEC rules.  The documents we incorporate by reference, all of which we have previously filed with the SEC, include:
•
Our Annual Report on Form 10-K for the year ended December 31, 2012, filed with the SEC on April 15, 2013;
•
Our Quarterly Report on Form 10-Q for the quarter ended March 31, 2013, filed with the SEC on May 15, 2013; and
•
Our Current Reports on Form 8-K filed with the SEC on February 26, 2013, March 22, 2013, April 10, 2013, April 12, 2013, May 17, 2013 and June 12, 2013.
A description of our capital stock can be found herein under "Description of Our Capital Stock."
You may request a copy of any of these filings at no cost, by writing or telephoning John R. Haddock, Chief Financial Officer, at (423) 308-2075,
jhaddock@FSGBank.com
, or at the following address or telephone number:  First Security Group, Inc, 531 Broad Street, Chattanooga, Tennessee 37402 or (423) 266-2000.
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QUESTIONS AND ANSWERS RELATING TO THE RIGHTS OFFERING
The following are examples of what we anticipate will be common questions about the rights offering.  The answers are based on selected information included elsewhere in this prospectus.  The following questions and answers do not contain all of the information that may be important to you and may not address all of the questions that you may have about the rights offering.  This prospectus contains more detailed descriptions of the terms and conditions of the rights offering and provides or incorporates by reference additional information about us and our business, including potential risks related to the rights offering, our common stock and our business.
What is the rights offering?
We are distributing, at no charge, to holders of shares of our common stock as of the record date, non-transferable subscription rights to purchase shares of our common stock.  You will receive one subscription right for each share of common stock you owned as of 5:00 p.m., Eastern Time, on April 10, 2013, the record date.  Each subscription right entitles the holder to a basic subscription privilege and an over-subscription privilege, which are described below.  The shares of common stock to be issued in the rights offering, like our existing shares of common stock, will be traded on the NASDAQ Capital Market under the symbol "FSGI."
Why are we conducting the rights offering?
On February 25, 2013, the Company entered into a number of agreements in connection with a $91.1 million recapitalization (the "Recapitalization"), including a Stock Purchase Agreement by and among the Company and the investors named therein (the "Stock Purchase Agreement").  Those agreements required the Company to issue and sell in a private placement (the "Private Placement"), approximately 60,735,000 shares of common stock at a price per share of $1.50 (the "Purchase Price").  The closing of the Private Placement occurred over two days.  On April 11, 2013 (the "TARP Closing Date"), the Company issued 9,941,908 shares of common stock to the United States Department of the Treasury (the "Treasury") in exchange for 33,000 shares of the Company's Fixed Rate Cumulative Perpetual Preferred Stock, Series A (the "TARP Preferred Stock"), a warrant to purchase 82,363 shares of the Company's common stock (the "TARP Warrant") and all accrued but unpaid dividends on the TARP Preferred Stock.  Treasury then immediately sold such shares of common stock to investors.  On April 12, 2013 (the "Investor Closing Date"), the Company sold 50,793,092 shares of common stock directly to investors.
As required by the Stock Purchase Agreement, we are conducting this rights offering to holders of our common stock as of April 10, 2013 (the "Pre-Recapitalization Shareholders") to provide the Pre-Recapitalization Shareholders with the opportunity to purchase up to approximately $5 million of our common stock at a purchase price per share equal to the Purchase Price paid by investors under the Stock Purchase Agreement.
What is the basic subscription privilege?
The basic subscription privilege gives the Pre-Recapitalization Shareholders the opportunity to purchase an aggregate of 3,329,234 shares of our common stock at a subscription price of $1.50 per share.  For each share of our common stock you owned as of the record date for the rights offering, your basic subscription privilege gives you the opportunity to purchase two shares of our common stock.  For example, if you owned 100 shares of common stock as of the record date, you would have received 100 subscription rights and would have the right to purchase 200 shares of our common stock for $1.50 per full share (or a total payment of $300.00).  You may exercise all or a portion of your basic subscription privilege, or you may choose not to exercise any subscription rights at all.  If you exercise less than your full basic subscription privilege, however, you will not be entitled to subscribe for shares under your over-subscription privilege.  We will not issue fractional shares through the exercise of the basic subscription privilege.
If you hold a First Security stock certificate, the number of rights you may exercise pursuant to your basic subscription privilege is indicated on the enclosed rights certificate.  If you hold your shares in the name of a custodian bank, broker, dealer or other nominee, you will not receive a rights certificate.  Instead, the Depository Trust Company will issue one subscription right to the nominee record holder for each share of our common stock that you owned at the record date.  If you are not contacted by your custodian bank, broker, dealer or other nominee, you should contact your nominee as soon as possible.  If the rights are attributable to shares that were held through the First Security Group, Inc. 401(k) and Employee Stock Ownership Plan (the "401(k) Plan"), you should follow the separate instructions provided to you by the tabulator designated by the trustee of the plan with respect to the shares held in that plan.
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What is the over-subscription privilege?
In the event that you purchase all of the shares of our common stock available to you pursuant to your basic subscription privilege, you may also choose to purchase a portion of any shares of our common stock that are not purchased by our other Pre-Recapitalization Shareholders through the exercise of their basic subscription privileges, as applicable.
You should indicate on your rights certificate how many additional shares you would like to purchase pursuant to your over-subscription privilege
.
If sufficient shares of common stock are available, we will seek to honor your over-subscription request in full.  If, however, over-subscription requests exceed the number of shares of common stock available, we will allocate the available shares of common stock pro rata based on the relative ownership percentages as of the record date of shareholders requesting additional shares.  We may exercise our discretion to round down to allocate shares in ten share increments.  As described above for the basic subscription privilege, we will not issue fractional shares through the exercise of over-subscription privileges.
In order to properly exercise your over-subscription privilege, you must deliver the subscription payment related to your over-subscription privilege at the time you deliver payment related to your basic subscription privilege.  Because we will not know the actual number of unsubscribed shares prior to the expiration of the rights offering, if you wish to maximize the number of shares you purchase pursuant to your over-subscription privilege, you will need to deliver payment in an amount equal to the aggregate subscription price for the maximum number of shares of our common stock that may be available to you.  See "The Rights Offering—Subscription Rights—Over-Subscription Privilege."
How was the $1.50 per share subscription price determined?
The Stock Purchase Agreement we previously entered into with investors provides that, as promptly as practicable following completion of the Recapitalization, First Security must conduct a rights offering to shareholders of record immediately prior to the Recapitalization pursuant to which such Pre-Recapitalization Shareholders may purchase up to $5.0 million of our common stock at a purchase price of $1.50 per share.  The $1.50 per share subscription price is designed to provide Pre-Recapitalization Shareholders with the opportunity to purchase shares of our common stock at the same price as the price of the common stock purchased by or issued to investors in the Recapitalization.
The subscription price is not necessarily related to our book value, net worth or any other established criteria of value and may or may not be considered the fair value of our common stock to be offered in the rights offering.  You should not assume or expect that, after the rights offering, our shares of common stock will trade at or above the $1.50 purchase price.
Am I required to exercise all of the subscription rights I receive in the rights offering?
No.  You may exercise any number of your subscription rights, or you may choose not to exercise any subscription rights.  If you do not exercise any subscription rights, the number of shares of our common stock you own will not change.  However, if you choose not to exercise your basic subscription privilege in full, your ownership interest in our common stock will be diluted as a result of the rights offering.  In addition, if you do not exercise your basic subscription privilege in full, you will not be entitled to participate in the over-subscription privilege.
How soon must I act to exercise my subscription rights?
If you received a rights certificate and elect to exercise any or all of your subscription rights, the subscription agent must receive your completed and signed rights certificate and payment prior to the expiration of the rights offering, which is
_________, 2013, at 5:00 p.m., Eastern Time.  If you hold your shares in the name of a custodian bank, broker, dealer or other nominee, your nominee may establish a deadline prior to 5:00 p.m. Eastern Time, on _________, 2013 by which you must provide it with your instructions to exercise your subscription rights and payment for your shares.  If the subscription rights are attributable to shares that were held in your account in the 401(k) Plan, you must provide your instructions to the tabulator designated by the trustee of the plan no later than the date and time specified in the separate instructions applicable to those shares. Our board of directors may, in its discretion, extend the rights offering one or more times, but in no event will the expiration date be later than _________, 201
3.  Our board of directors may, in its discretion, cancel or amend the rights offering at any time. In
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the event that the rights offering is cancelled, all subscription payments received will be returned promptly, without interest or penalty.
Although we will make reasonable attempts to provide this prospectus to holders of subscription rights, the rights offering and all subscription rights will expire at 5:00 p.m., Eastern Time on
_________
, 2013 (unless extended), whether or not we have been able to locate each person entitled to subscription rights.
May I transfer my subscription rights?
No. You may not sell, transfer or assign your subscription rights to anyone.
Subscription rights will not be traded on the NASDAQ Capital Market or any other stock exchange or market.  Rights certificates may only be completed by the shareholder who receives the certificate.
Are we requiring a minimum subscription to complete the rights offering?
There is no individual or aggregate minimum purchase requirement in the rights offering.
Is there a limit to how much stock is being issued in the rights offering?
We will accept subscriptions for up to an aggregate of 3,329,234 shares of common stock in the rights offering.
Has our board of directors made a recommendation to our shareholders regarding the rights offering?
No.  Our board of directors is making no recommendation regarding your exercise of the subscription rights.  Shareholders who exercise subscription rights risk investment loss on new money invested.  We cannot predict the price at which our shares of common stock will trade; therefore, we cannot assure you that the market price for our common stock will be above the subscription price or that anyone purchasing shares at the subscription price will be able to sell those shares in the future at the same price or a higher price.  You are urged to make your decision based on your own assessment of our business and the rights offering.  Please see "Risk Factors" for a discussion of some of the risks involved in investing in our common stock.
Are there any limits on the number of shares I may purchase in the rights offering?
Subject to the discretion of the board of directors, a person, together with certain related persons and associates, may not purchase a number of shares such that upon completion of the rights offering the person owns securities representing in excess of 4.9% of the Company's outstanding shares of common stock.  Additionally, federal law generally requires prior regulatory approval for any person or persons acting in concert to acquire 10% or more of our common stock.  We also will not issue shares of our common stock pursuant to the exercise of basic subscription rights or over-subscription rights to any person or entity who, in our sole opinion, could be required to obtain prior clearance or approval from or submit a notice to any state or federal bank regulatory authority to acquire, own or control such shares if, as of
_________
, 2013, we determine that such clearance or approval has not been obtained and/or any applicable waiting period has not expired.  If we elect not to issue shares in either such case, the unissued shares will become available to satisfy over-subscription elections by other shareholders pursuant to their subscription rights.
How do I exercise my subscription rights if I own shares in certificated form?
If you hold a First Security stock certificate and you wish to participate in the rights offering, you must take the following steps:
•
deliver a properly completed and signed rights certificate, and related subscription documents, to the subscription agent before 5:00 p.m., Eastern Time, o
n _________, 2013; and
•
deliver payment to the subscription agent before 5:00 p.m., Eastern Time, on _________, 2013.
In certain cases, you may be required to provide additional documentation or signature guara
ntees.
Please follow the delivery instructions on the rights certificate.  Do not deliver documents to First Security.  You are solely responsible for completing delivery to the subscription agent of your subscription documents, rights certificate and payment.  We urge you to allow sufficient time for delivery of your subscription materials to the
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subscription agent so that they are received by the subscription agent by 5:00 p.m. Eastern Time, on
___________,
2013.
If you send a payment that is insufficient to purchase the number of shares you requested, or if the number of shares you requested is not specified in the forms, the payment received will be applied to exercise your subscription rights to the fullest extent possible based on the amount of the payment received, subject to the availability of shares under the over-subscription privilege and the elimination of fractional shares. Any excess subscription payments received by the subscription agent will be returned, without interest, as soon as practicable following the expiration of the rights offering.
What form of payment is required to purchase the shares of our common stock in the rights offering?
As described in the instructions accompanying the rights certificate, payments submitted to the subscription agent must be made in full in United States currency by:
•
personal check payable to Registrar and Transfer Company, our subscription agent, drawn upon a United States bank;
•
bank check or bank draft payable to Registrar and Transfer Company, drawn upon a United States bank;
•
postal, telegraphic or express money order payable to Registrar and Transfer Company; or
•
wire transfer of immediately available funds to the account maintained Registrar and Transfer Company.
If you are issued subscription rights attributable to shares that were held in your account in the 401(k) Plan, the payment for the exercise of those subscription rights will be deducted from funds held in your account in the 401(k) Plan as described in more detail in the separate instructions applicable to those rights.
What should I do if I want to participate in the rights offering, but my shares are held in the name of a custodian bank, broker, dealer or other nominee?
If you hold your shares of common stock through a custodian bank, broker, dealer or other nominee, then your nominee is the record holder of the shares you own.
If you are not contacted by your nominee, you should contact your nominee as soon as possible.  Your nominee must exercise the subscription rights on your behalf for the shares of common stock you wish to purchase.  You will not receive a rights certificate.  Please follow the instructions of your nominee.  Your nominee may establish a deadline that may be before the 5:00 p.m., Eastern Time,
_________
, 2013 expiration date that we have established for the rights offering.
When will I receive my new shares?
If you purchase stock in the rights offering by submitting a rights certificate and payment, we will mail you a stock certificate as soon as practicable after the expiration date of the rights offering.  If your shares as of April 10, 2013 were held by a custodian bank, broker, dealer or other nominee, and you participate in the rights offering, you will not receive stock certificates for your new shares.  Your nominee will be credited with the shares of common stock you purchase in the rights offering as soon as practicable after the expiration of the rights offering.
After I send in my payment and rights certificate, may I cancel my exercise of subscription rights?
No.  All exercises of subscription rights are irrevocable unless the rights offering is terminated, even if you later learn information that you consider to be unfavorable to the exercise of your subscription rights.  You should not exercise your subscription rights unless you are certain that you wish to purchase shares of our common stock in the rights offering.
Are there any conditions to completing the rights offering?
No, there are no conditions to completing the rights offering.
Will our directors and officers participate in the rights offering?
As of April 10, 2013, our current directors and executive officers owned approximately 142,019 shares of our common stock.  Due to the number of outstanding shares of our common stock as of the record date of the rights
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offering, in order to facilitate the Company's compliance with the $5,000,000 maximum rights offering amount imposed by the Stock Purchase Agreement and still offer each Pre-Recapitalization Shareholder the right to purchase two shares of our common stock, five of the Company's directors and executive officers holding an aggregate of 23,750 shares on the record date have waived their right to participate in the rights offering.  In addition, 63,750 of the shares of restricted stock owned by directors and executive officers as of the record date were forfeited and are not eligible to participate in the rights offering.  As a result, our directors and executive officers collectively hold rights to purchase 109,038 shares of our common stock in the rights offering.  Certain of our directors and executive officers have indicated an interest in participating in the rights offering.  Collectively, we expect our directors and executive officers to purchase approximately
shares of our common stock in the rights offering.  Our directors and executive officers are entitled to participate in the rights offering on the same terms and conditions applicable to all Pre-Recapitalization Shareholders.  Following the rights offering, our current directors and executive officers, together with their affiliates, are expected to beneficially own
shares of common stock, or approxima
tely _
% of our outstanding common stock, assuming that all shares are subscribed for in the rights offering and that no directors, executive officers or their affiliates participate in the oversubscription aspect of the rights offering.  See "Security Ownership of Certain Beneficial Owners And Management."
After I send in my acknowledgement of subscription and my payment, may I cancel my exercise of subscription rights?
Once you submit the acknowledgement of subscription and your payment, you will not be allowed to revoke your subscription or request a refund of monies paid.  All acknowledgements of subscriptions are irrevocable, even if you learn information about us that you consider to be unfavorable.  You should not submit an acknowledgement of subscription unless you are certain that you wish to purchase shares of our common stock at the subscription price.  However, with respect to subscription rights issued to your account in the 401(k) Plan, if the market price of the stock is less than the subscription price on the date the rights are exercised, the trustee will not execute your instructions to purchase the common stock and your money will be refunded to your account in the 401(k) Plan.
What effects will the rights offering have on our outstanding common stock?
As of April 10, 2013, 1,795,542
shares of our common stock were issued and outstanding. On April 11, 2013 and April 12, 2013, the date following the record date for the rights offering, we issued an additional 60,735,000 shares of common stock in the Recapitalization and 107,175 shares of restricted stock were forfeited pursuant to the terms of the Exchange Agreement, leaving us with 62,423,367 shares of common stock outstanding immediately following the Recapitalization.  Assuming no options are exercised prior to the expiration of the rights offering and assuming all 3,329,234 shares are sold in the rights offering, we expect 65,752,601 shares of our common stock will be outstanding immediately after completion of the rights offering.
The issuance of shares of our common stock in the rights offering will further dilute, and thereby reduce, your proportionate ownership in shares of our common stock unless you fully exercise your basic subscription privilege.
How much will we receive in net proceeds from the rights offering?
If the rights offering is fully subscribed, we expect that the aggregate rights offering proceeds, net of dealer manager fees and expenses, to be approximately $4.475 million.  We intend to use the offering proceeds to supplement the capital of First Security and for general corporate purposes.  See "Use of Proceeds."
Are there risks in exercising my subscription rights?
Yes.  The exercise of your subscription rights involves risks.  Exercising your subscription rights involves the purchase of additional shares of our common stock and should be considered as carefully as you would consider any other equity investment. Among other things, you should carefully consider the risks described under the heading "Risk Factors" in this prospectus and the information incorporated by reference herein and contained in the section entitled "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2012 and any risks described in our other filings with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act.
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If the rights offering is not completed, will my subscription payment be refunded to me?
Yes.  The subscription agent will hold all funds it receives in a segregated bank account until completion of the rights offering.  If the rights offering is not completed, all subscription payments received by the subscription agent will be returned promptly, without interest or penalty.  If your shares are held in the name of a custodian bank, broker, dealer or other nominee, it may take longer for you to receive the refund of your subscription payment because the subscription agent will return payments through the record holder of your shares.
What fees or charges apply if I purchase shares of the common stock in the rights offering?
We are not charging any fee or sales commission to issue subscription rights to you or to issue shares to you if you exercise your subscription rights (other than the subscription price).  If you exercise your subscription rights through a custodian bank, broker, dealer or other nominee, you are responsible for paying any fees or sales commissions your nominee may charge you.
Who should I contact if I have other questions?
If you have other questions regarding First Security or the rights offering, please contact our dealer manager, Raymond James & Associates, Inc., at 404-240-2907 (or toll-free at 866-777-7789), attention: Sanjay Patel, Monday through Friday (except bank holidays), between 9:00 a.m. and 5:00 p.m., Eastern Time.
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PROSPECTUS SUMMARY
This prospectus summary highlights the information contained elsewhere in this prospectus.  Because this is only a summary, it does not contain all of the information that you should consider before deciding whether to exercise your subscription rights.  You should read this entire prospectus carefully, including the information set forth in "Risk Factors," and the documents identified in the sections "Where You Can Find More Information" and "Incorporation of Certain Documents by Reference" in this prospectus, in their entirety before you decide to exercise your subscription rights.
First Security Group, Inc. and FSGBank
We are a bank holding company headquartered in Chattanooga, Tennessee.  Founded in 1999, First Security's community bank subsidiary, FSGBank, has 30 full-service banking offices along the interstate corridors of eastern and middle Tennessee and northern Georgia.  In Dalton, Georgia, FSGBank operates under the name "Dalton Whitfield Bank," and along the Interstate 40 corridor in Tennessee, FSGBank operates under the name "Jackson Bank & Trust."
Through FSGBank, we offer a range of lending services that are primarily secured by single and multi-family real estate, residential construction and owner-occupied commercial buildings.  In addition, we focus on serving the needs of small- to medium-sized businesses, by offering a range of lending, deposit and wealth management services to these businesses and their owners.  Our principal source of funds for loans and securities is core deposits gathered through our branch network.  We offer a wide range of deposit services, including checking, savings, money market accounts and certificates of deposit, and obtain most of our deposits from individuals and businesses in our market areas, including the vast majority of our loan customers.  Our wealth management division offers private client services, financial planning, trust administration, investment management and estate planning services.  We also provide mortgage banking and electronic banking services, such as Internet banking, online bill payment, cash management, ACH originations, and remote deposit capture.  We actively pursue business relationships by utilizing the business contacts of our Board of Directors, senior management and local bankers, thereby capitalizing on our extensive knowledge of the local marketplace.
As of March 31, 2013, we had total assets of approximately $1.0 billion, total deposits of approximately $990.9 million and tangible shareholders' equity of approximately $20.5 million.
The Recapitalization
On February 25, 2013, the Company entered into a number of agreements in connection with its $91.1 million Recapitalization, including the Stock Purchase Agreement.  Those agreements required the Company to issue and sell, in a Private Placement, 60,735,000 shares of common stock at the Purchase Price of $1.50 per share.  The closing of the Private Placement took place over two days, with the issuance of 9,941,908 shares of common stock to Treasury in exchange for 33,000 shares of the Company's TARP Preferred Stock, the TARP Warrant to purchase 82,363 shares of common stock, and all accrued but unpaid dividends on the TARP Preferred Stock, and the sale by Treasury of such shares of common stock to investors occurring on the TARP Closing Date of April 11, 2013, and the sale of 50,793,092 shares of common stock directly to investors occurring on the Investor Closing Date, April 12, 2013.  See "Summary of the Recapitalization."
Pursuant to the Stock Purchase Agreement, 60,735,000 shares of our common stock sold in the Recapitalization have been registered for resale on a registration statement on Form S-1 (File No. 333-188137) that was declared effective by the SEC on June 6, 2013.  The investors in our Recapitalization are no longer subject to lock-up agreements or any other contractual agreements not to dispose of our shares and these shares are freely transferable.
Regulatory Matters
First Security Group, Inc.
On September 7, 2010, the Company entered into a Written Agreement (the "Agreement") with the Federal Reserve Bank of Atlanta (the "Federal Reserve"), the Company's primary regulator.  The Agreement places restrictions on the Company that are designed to enhance the Company's ability to act as a source of strength to the Company's wholly owned subsidiary, FSGBank.  The Agreement prohibits the Company
10
from declaring or paying dividends without prior written consent of the Federal Reserve.  The Company is also prohibited from taking dividends, or any other form of payment representing a reduction of capital, from FSG Bank without prior written consent.  Within 60 days of the Agreement, the Company was required to submit to the Federal Reserve a written plan designed to maintain sufficient capital at the Company and the FSGBank.  The Company submitted a copy of FSGBank's capital plan that had previously been submitted to FSGBank's primary regulator, the Office of the Comptroller of the Currency (the "OCC").  During May 2013, the OCC requested updated capital and strategic plans based on the Recapitalization.  On July 1, 2013, FSGBank submitted capital and strategic plans to the OCC.  The plans were also submitted to the Federal Reserve by the Company.  We can give no assurance that the Federal Reserve or the OCC will approve our capital and strategic plans.
The Company is currently deemed not in compliance with several provisions of the Agreement.  Any material noncompliance may result in further enforcement actions by the Federal Reserve.  Management believes the successful execution of the strategic initiatives discussed below will ultimately result in full compliance with the Agreement and position the Company for long-term growth and a return to profitability.
The Company's regulatory capital ratios as of March 31, 2013 were as follows: Tier 1 leverage ratio was 1.90% and total risk-based capital ratio was 4.68%.  On April 11-12, 2013, the Company issued 60,735,000 shares of common stock in the Private Placement.  After accounting for the net proceeds from the Private Placement, the Company's pro forma regulatory capital ratios as of March 31, 2013 were as follows:  Tier 1 leverage ratio was 9.0% and total risk-based capital ratio was 17.5%.
The Agreement is incorporated by reference as Exhibit 10.20 to the registration statement of which this prospectus is a part and incorporated by reference herein.  The foregoing summary is not complete and is qualified in all respects by reference to the actual language of the Agreement.
FSGBank.
On April 28, 2010, pursuant to a Stipulation and Consent to the Issuance of a Consent Order, FSGBank consented and agreed to the issuance of a Consent Order by the OCC (the "Order").  FSGBank and the OCC agreed to the areas of FSGBank's operations that warrant improvement and on a plan for making those improvements.  The Order required FSGBank to develop and submit written strategic and capital plans covering at least a three year period.  The Board of Directors is required to ensure that competent management is in place in all executive officer positions to manage the FSGBank in a safe and sound manner.  In response, the Company and FSGBank underwent a restructuring of their executive and senior management teams. FSGBank is also required to review and revise various policies and procedures, including those associated with credit concentration management, the allowance for loan and lease losses, liquidity management, criticized assets, loan review and credit.  FSGBank is continuing to work with the OCC to ensure the policies and procedures are both appropriate and fully implemented.
Within 120 days of the effective date of the Order, FSGBank was required to achieve and thereafter maintain total capital at least equal to 13.0% of risk-weighted assets and Tier 1 capital at least equal to 9.0% of adjusted total assets.  FSGBank has not achieved compliance with the capital requirements of the Order.  As of March 31, 2013, the eleventh financial reporting period subsequent to the 120 day requirement, FSGBank's total capital to risk-weighted assets was 4.7% and the Tier 1 capital to adjusted total assets was 1.9%.  After accounting for the $65.0 million capital contribution by the Company into FSGBank, FSGBank's pro-forma regulatory capital ratios as of March 31, 2013 were as follows: Tier 1 leverage ratio was 8.1%, Tier 1 risk-based capital ratio was 14.5% and total risk-based capital ratio was 15.8%.  FSGBank has notified the OCC of its non-compliance with the requirements of the Order.
During the third quarter of 2010, the OCC requested additional information and clarifications to FSGBank's submitted strategic and capital plans as well as the management assessments.  Subsequent to the resignation of its chief executive officer in April 2011, FSGBank requested an extension on the submission date for the strategic and capital plans until a new chief executive officer was appointed and had sufficient time to modify the strategic plan.  Strategic and capital plans covering three-years have been revised to reflect the actual terms and timing of the Recapitalization and were submitted to the OCC and Federal Reserve on July 1, 2013 for approval.  We can give no assurance that the Federal Reserve or the OCC will approve our capital and strategic plans.
Effective with the Order, FSGBank has been restricted from paying interest on deposits that is more than 0.75% above the rate applicable to the applicable market of FSGBank as determined by the Federal Deposit Insurance Corporation (the "FDIC").  Additionally, FSGBank may not accept, renew or roll over brokered deposits without prior approval of the FDIC.
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FSGBank is currently deemed not in compliance with several provisions of the Order, including the capital requirements.  However, management believes that the completed Recapitalization will significantly improve compliance with the requirements of the Order.
The Order is incorporated by reference in Exhibit 10.18 to the registration statement of which this prospectus is a part and incorporated by reference herein.  The foregoing summary is not complete and is qualified in all respects by reference to the actual language of the Order.
As of September 30, 2012, FSGBank's Tier I leverage ratio fell below the minimum level for an "adequately capitalized" bank of 4.0%.  As described below, there are three classifications for banks that are below "adequately capitalized," as follows: "undercapitalized," "significantly undercapitalized," and "critically undercapitalized."  As of December 31, 2012, FSGBank was reclassified from "undercapitalized" to "significantly undercapitalized" upon the filing of the call report on January 30, 2013.  As of March 31, 2013, FSGBank was reclassified to "critically undercapitalized" upon the filing of the call report on April 30, 2013.  Following the Recapitalization, on April 23, 2013, FSGBank filed a cash contribution to capital notice with the OCC certifying a $65.0 million capital contribution by the Company into FSGBank.  With that capital contribution, FSGBank's pro forma regulatory capital ratios as of March 31, 2013 increased as follows:  Tier 1 leverage ratio from 1.9% to 8.1%, Tier 1 risk-based capital ratio from 3.4% to 14.5% and total risk-based capital ratio from 4.7% to 15.8%.  All pro forma regulatory capital measures exceed the percentages of a well capitalized institution as defined under applicable regulatory guidelines; however, FSGBank's Tier 1 leverage ratio continues to be below the 9.0% required by the Order.  FSGBank will continue to be classified as adequately capitalized due to the capital requirements in the Order.
Corporate Information
Our common stock is traded on the NASDAQ Capital Market under the symbol "FSGI."  We were incorporated in the state of Tennessee on February 1, 1999.  Our principal executive offices are located at 531 Broad Street, Chattanooga, Tennessee 37402, and our telephone number is (423) 266-2000.  Our internet address is www.fsgbank.com.  The information contained on our website is not part of this prospectus.
12
Summary of Rights Offering
The following summary describes the principal terms of the rights offering, but is not intended to be complete. See the information under the heading "The Rights Offering" in this prospectus for a more detailed description of the terms and conditions of the rights offering.
Securities Offered
We are distributing to you, at no charge, one non-transferable subscription right for each share of our common stock that you owned as of 5:00 p.m., Eastern Time, on April 10, 2013, either as a holder of record or, in the case of shares held of record by custodian banks, brokers, dealers or other nominees on your behalf, as a beneficial owner of such shares.
Subscription Price
$1.50 per share.
Record Date
5:00 p.m., Eastern Time, on April 10, 2013.
Expiration of the Rights Offering
5:00 p.m., Eastern Time, on
_________
, 2013.  We may extend the rights offering without notice to you until
_________
, 2013.
Use of Proceeds
We expect the aggregate net proceeds from the rights offering to be approximately
$4.475
million.  We intend to use the proceeds of the rights offering to supplement the capital of First Security and for general corporate purposes.
Basic Subscription Privilege
The basic subscription privilege of each subscription right entitles you to purchase two shares of our common stock at a subscription price of $1.50 per share.
Over-Subscription Privilege
In the event that you purchase all of the shares of our common stock available to you pursuant to your basic subscription privilege, you may also choose to subscribe for a portion of any shares of our common stock that are not purchased by our other shareholders through the exercise of their basic subscription privileges. You may subscribe for shares of common stock pursuant to your over-subscription privilege, subject to the purchase and ownership limitations described below under the heading "Limitations on the Purchase of Shares."
Limitations on the Purchase of Shares
Subject to the discretion of our board of directors, a person, together with certain related persons and associates, may not purchase a number of shares such that upon completion of the rights offering the person owns securities representing in excess of 4.9% of our common stock.  Additionally, federal law generally requires prior regulatory approval for any person or persons acting in concert to acquire 10% or more of our common stock.  We will not issue shares of our common stock pursuant to the exercise of basic subscription rights or over-subscription rights, or to any person or entity who, in our sole opinion, could be required to obtain prior clearance or approval from or submit a notice to any state or federal bank regulatory authority to acquire, own or control such shares if, as of
___________
, 2013, we determine that such clearance or approval has not been obtained and/or any applicable waiting period has not expired.
Non-Transferability of Rights
The subscription rights may not be sold, transferred or assigned and will not be traded on the NASDAQ Capital Market or on any other stock exchange or market.
No Board Recommendation
Our board of directors is making no recommendation regarding the exercise of your subscription rights.  You are urged to make your decision based on your own assessment of our business and the rights offering.  Please see the "Risk Factors" section in this prospectus, the information incorporated by reference herein and contained in the section entitled "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2012 and any risk described in our other filings with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act for a discussion of some of the risks involved in investing in our common stock.
Revocation
Except with regard to rights issued to accounts in the 401(k) Plan, all exercises of subscription rights are irrevocable, even if you later learn of information that you consider to be unfavorable to the exercise of your subscription rights.  You should not exercise your subscription rights unless you are certain that you wish to purchase additional shares of our common stock in the rights offering at a subscription price of $1.50 per share.  Note, however, that rights issued to accounts in the 401(k) Plan will not be exercised if the market price of our common stock is below a $1.50 on the date the common stock is to be purchased.
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Purchase Intentions of Our Directors and Officers
Our directors and executive officers collectively hold rights to purchase 109,038 shares of our common stock in the rights offering.  Certain of our directors and executive officers have indicated an interest in participating in the rights offering.  Collectively, we expect our directors and executive officers to purchase approximately
shares of our common stock in the rights offering.  Our directors and executive officers are entitled to participate in the rights offering on the same terms and conditions applicable to all other Pre-Recapitalization Shareholders.
Maximum Offering
The rights offering is subject to a limit of 3,329,234 shares of common stock.
Material U.S. Federal Income Tax Considerations
For U.S. federal income tax purposes, you should not recognize income or loss upon the receipt, exercise or lapse of the subscription rights.  You should consult your own tax advisor as to the tax consequences to you of the receipt, exercise or lapse of the subscription rights in light of your particular circumstances.
Extension and Cancellation
Although we do not presently intend to do so, we have the option to extend the rights offering expiration date, but in no event will we extend the rights offering beyond
___________, 201
3.  Our board of directors may cancel the rights offering at any time.  In the event that the rights offering is cancelled, all subscription payments received by the subscription agent will be promptly returned, without interest.
Dealer Manager
Raymond James & Associates, Inc.
Shares Outstanding Before the Rights Offering
62,428,367 shares of our common stock were outstanding as of
June 15,
2013.
Shares Outstanding After Completion of the Rights Offering
Assuming no options are exercised prior to the expiration of the rights offering and assuming all 3,329,234 shares of common stock are sold in the rights offering, we expect 65,752,601 shares of our common stock will be outstanding immediately after completion of the rights offering.
Trading Symbol
Shares of our common stock are currently traded on the NASDAQ Capital Market under the symbol "FSGI."
Risk Factors
Before you exercise your subscription rights to purchase shares of our common stock, you should be aware that there are risks associated with your investment, including the risks described in the section entitled "Risk Factors" of this prospectus, the risks that we have highlighted in other sections of this prospectus, the information incorporated by reference herein and contained in the section entitled "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2012 and any risks described in our other filings with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act. You should carefully read and consider these risk factors together with all of the other information included in this prospectus before you decide to exercise your subscription rights to purchase shares of our common stock.
14
RISK FACTORS
An investment in our common stock involves a high degree of risk. Before you purchase shares of our common stock, you should carefully consider the risks described below, together with the other information contained or incorporated by reference into this prospectus, including the information contained in the section entitled "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2012 and any risks described in our other filings with the SEC, pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act, before making a decision to invest in our common stock. The risks described below and in the documents referred to in the preceding sentence are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially and adversely affect our business operations. If any of the following risks actually occurs, our business, results of operations and financial condition could suffer. In that case, the trading price of our common stock and the values of any of our other securities could decline, and you may lose all or part of your investment.
Risks Related to the Rights Offering
The market price of our common stock is volatile and the future price of the shares of our common stock may be less than the $1.50 purchase price per share in the rights offering.
If you exercise your subscription rights to purchase shares of common stock in the rights offering, you may not be able to sell them later at or above the $1.50 purchase price in the rights offering.  The actual market price of our common stock could be subject to wide fluctuations in response to numerous factors, some of which are beyond our control.  These factors include, among other things, actual or anticipated variations in our costs of doing business, operating results and cash flow, the nature and content of our earnings releases and our competitors' earnings releases, changes in financial estimates by securities analysts, business conditions in our markets and the general state of the securities markets and the market for other financial stocks, changes in capital markets that affect the perceived availability of capital to companies in our industry, governmental legislation or regulation, currency and exchange rate fluctuations, as well as general economic and market conditions, such as downturns in our economy and recessions.
All exercises of subscription rights are irrevocable, even if you learn information about us that you consider to be unfavorable or the market price of our common stock declines below the subscription price you have paid.
Other than with respect to subscription rights issued to accounts in the 401(k) Plan, once you exercise your subscription rights, you may not revoke them, even if you learn information about us that you consider to be unfavorable.  If you exercise your subscription rights and, afterwards, the public trading market price of our shares of common stock decreases below the subscription price, you will have committed to buying shares of our common stock at a price above the prevailing market price and could have an immediate unrealized loss.  Our common stock is traded on the NASDAQ Capital Market under the ticker symbol "FSGI," and the last reported sales price of our common stock on the NASDAQ Capital Market on July 2, 2013 was $2.16 per share.  We cannot assure you that the market price of shares of our common stock will not decline after you exercise your subscription rights.  Moreover, we cannot assure you that following the exercise of your subscription rights you will be able to sell your common stock at a price equal to or greater than the subscription price.
The subscription price determined for the rights offering is not an indication of the fair value of our common stock.
As required by the Stock Purchase Agreement, we are conducting this rights offering to provide our Pre-Recapitalization Shareholders with the opportunity to purchase up to 3,329,234 shares of our common stock at a purchase price per share of $1.50, the same price per share paid by investors in the Recapitalization.  The per share subscription price is not necessarily related to our book value, net worth or any other established criteria of fair value and may or may not be considered the fair value of our common stock to be offered in the rights offering.  After the date of this prospectus, our shares of common stock may trade at prices below the subscription price.
Shareholders may face dilution as a result of the rights offering.
Other than shareholders who purchase sufficient shares of our common stock in the rights offering to maintain their proportionate ownership interest, the issuance of shares of our common stock in the rights offering will dilute, and thereby reduce, each existing shareholder's proportionate ownership interest in shares of our
15
common stock.  The dilutive effect of the rights offering may have an adverse impact on the market price of our common stock.
We may, in our sole discretion, terminate the rights offering at any time prior to the expiration of the rights offering.
We may, in our sole discretion, terminate the rights offering at any time prior to the expiration of the rights offering.  If we terminate the rights offering, neither we nor the dealer manager and the subscription agent will have any obligation to you with respect to the subscription rights except to return any exercise payment received by the subscription agent, without interest or penalty.
You will not be able to sell the shares you buy in the rights offering until you receive your stock certificates or your account is credited with the shares of common stock.
If you purchase shares of our common stock in the rights offering by submitting a rights certificate and payment, we will mail you a stock certificate as soon as practicable after the expiration of the rights offering, on
___________,
2013, or such later date as to which the rights offering may be extended.  If your shares are held by a custodian bank, broker, dealer or other nominee or are held in the 401(k) Plan and you purchase shares of our common stock, your account with your nominee or the 401(k) Plan will be credited with the shares of common stock you purchased in the rights offering as soon as practicable after the expiration of the rights offering, or such later date as to which the rights offering may be extended.  Until your stock certificates have been delivered or your account is credited, you may not be able to sell your shares even though the common stock issued in the rights offering will be traded on the NASDAQ Capital Market.  The stock price may decline between the time you decide to sell your shares and the time you are actually able to sell your shares.
Our common stock has substantially less liquidity than other publicly traded companies.
Our common stock has substantially less liquidity than other publicly traded companies.  A public trading market having the desired characteristics of depth, liquidity and orderliness depends on the presence in the marketplace of willing buyers and sellers of our common stock at any given time.  This marketplace depends on the individual decisions of investors and general economic and market conditions over which we have no control.  This limited market may affect your ability to sell your shares on short notice, and the sale of a large number of shares at one time could temporarily depress the market price of our common stock.  For these reasons, our common stock should not be viewed as a short-term investment.
The market price of our common stock may fluctuate in the future, and this volatility may be unrelated to our performance. General market price declines or overall market swings in the future could adversely affect the price of our common stock, and the current market price may not be indicative of future market prices.
We have broad discretion in the use of proceeds of the rights offering.
We have not designated the anticipated net proceeds of the rights offering for specific uses.  Accordingly, our management will have considerable discretion in the application of the net proceeds of the rights offering and you will not have the opportunity, as part of your investment decision, to assess whether the proceeds are being used appropriately or effectively.  Management's failure to utilize the proceeds effectively could have an adverse effect on our business, financial condition and results of operations.  See "Use of Proceeds."
Significant sales of our common stock from the Recapitalization or this rights offering, or the perception that significant sales may occur in the future, could adversely affect the market price for our common stock.
The sale of substantial amounts of our common stock could adversely affect the price of our common stock. Sales of substantial amounts of our common stock in the public market, and the availability of shares for future sale could cause the market price of our common stock to decline and remain low for a substantial amount of time. Pursuant to the Stock Purchase Agreement, 60,735,000 shares of our common stock sold in the Recapitalization have been registered for resale on a registration statement on Form S-1 (File No. 333-188137
)
that was declared effective by the SEC on June 6, 2013. The investors in our Recapitalization are no longer subject to any lock-up agreements or any other contractual agreements not to dispose of our shares. Any disposition by the investors in our Recapitalization, or any of our substantial shareholders, of our common stock in the public market, or the perception that such dispositions could occur, will likely adversely affect prevailing market prices of our common stock, causing a decline in our market price.  We cannot foresee the impact of such potential sales on the market, but it is possible that if a significant percentage of such available shares were attempted to be sold within a short period of time, the market of our shares would be adversely affected.  Even if a substantial number of sales do not occur
16
within a short period of time, the mere existence of this "market overhang" could have a negative impact on the market for our common stock and our ability to raise additional capital.
Your percentage ownership in our common stock may be diluted in the future because of existing equity awards on our common stock, and future capital raising activities.
As of March 31, 2013, we had outstanding options to purchase 132,196 shares of our common stock at a weighted average exercise price of $24.26 per share. All of these options are held by our directors, executive officers and employees. The issuance of shares following the exercise of options will result in dilution of your ownership of our common stock. In the future, we may issue additional equity securities in order to fund working capital needs, regulatory capital requirements, capital expenditures and product development, or to make acquisitions and other investments, which may dilute your ownership interest.
If you do not act promptly and follow the subscription instructions, your exercise of subscription rights may be rejected.
If you desire to purchase shares in the rights offering, you must act promptly to ensure that the subscription agent actually receives all required forms and payments before the expiration of the rights offering at 5:00 p.m., Eastern Time, on
_________,
2013, unless we extend the rights offering for additional periods. If you are a beneficial owner of shares, you must act promptly to ensure that your broker, dealer, custodian bank or other nominee holder acts for you and that all required forms and payments are actually received by the subscription agent before the expiration of the rights offering. We are not responsible if your nominee fails to ensure that the subscription agent receives all required forms and payments before the expiration of the rights offering. If you fail to complete and sign the required subscription forms, send an incorrect payment amount, or otherwise fail to follow the subscription procedures that apply to the exercise of your subscription rights prior to the expiration of the rights offering, the subscription agent may reject your subscription or accept it only to the extent of the payment received. Neither we nor our subscription agent undertake any responsibility to contact you concerning an incomplete or incorrect subscription form or payment, nor are we under any obligation to correct such forms or payment. We have the sole discretion to determine whether a subscription exercise properly complies with the subscription procedures.
We may place a limit on the number of shares of common stock you may purchase if your exercise of subscription rights (including the oversubscription privilege) would result in you owning more than 4.9% of our common stock.
Subject to the discretion of our board of directors, a person, together with certain related persons and associates, may not purchase a number of shares such that upon completion of the rights offering the person owns securities representing in excess of 4.9% of our common stock.
In addition, we will not issue shares of our common stock pursuant to the exercise of basic subscription rights or over-subscription rights, to any person or entity who, in our sole opinion, could be required to obtain prior clearance or approval from or submit a notice to any state or federal bank regulatory authority to acquire, own or control such shares if, as of the expiration date of the rights offering, we determine that such clearance or approval has not been obtained and/or any applicable waiting period has not expired.
In the event that shares are not issued because of either of the above restrictions based on percentage ownership, or the failure to obtain regulatory clearance or approval, the right to acquire such shares will be forfeited and such shares will become available to satisfy oversubscription privileges by other participating shareholders.  You will be asked to certify that you are not in violation of this provision when you exercise your subscription rights, and we will pursue any and all legal remedies available to us against anyone who violates this provision. In addition, violation of this provision may subject you to investigation and sanctions by federal bank regulatory authorities.
The subscription rights are not transferable and there is no market for the subscription rights.
You may not sell, give away or otherwise transfer your subscription rights. The subscription rights are only transferable by operation of law. Because the subscription rights are non-transferable, there is no market or other means for you to directly realize any value associated with your subscription rights.
We are currently operating under a Consent Order from the OCC and a Written Agreement from the Federal Reserve, which will impact our operations and generally require significant management attention.
17
While we continue to make progress on compliance with our regulatory agreements and expect that the completion of our Recapitalization will improve such compliance, we are currently not in compliance with several components of the agreements, including the capital requirements. Our compliance efforts require a significant amount of our management's time and attention. Continuing non-compliance may result in additional restrictions and/or regulatory enforcement actions that may negatively impact our operations and financial condition.
We are subject to an Order imposed by the OCC that could have a material negative affect on our business, operating flexibility, financial condition and the value of our common stock. In addition, addressing the Order will require significant time and attention from our management team, which may increase our costs, impede the efficiency of our internal business processes and adversely affect our profitability in the near-term.
On April 28, 2010, pursuant to a Stipulation and Consent to the Issuance of a Consent Order,  FSGBank by and through its Board of Directors consented and agreed to the issuance of a Consent Order by the OCC, FSGBank's primary regulator. FSGBank and the OCC agreed as to the areas of  FSGBank's operations that warranted improvement and to a plan for making those improvements. The Order requires FSGBank to develop and submit written strategic and capital plans covering at least a three-year period. FSGBank is required to review and revise various policies and procedures, including those associated with concentration management, the allowance for loan and lease losses, liquidity management, criticized asset, loan review and credit.
While the Company has taken, and intends to continue to take, such actions as may be necessary to enable FSGBank to comply with the requirements of the Order, there can be no assurance that  FSGBank will be able to comply fully with the provisions of the Order, or that efforts to comply with the Order, particularly the limitations on interest rates offered by FSGBank, will not have adverse effects on the operations and financial condition of the Company and FSGBank.
We are currently deemed not in compliance with several provisions of the Order, including the capital requirements. However, management believes that the completed Recapitalization will improve FSGBank's compliance with the requirements of the Order. Any material noncompliance could result in further enforcement actions by the OCC, including the OCC requiring that FSGBank develop a plan to sell, merge or liquidate. We can provide no assurances that we will be able to comply fully with the Order, that efforts to comply with the Order will not have a material adverse effect on the operations and financial condition of FSGBank, or that further enforcement actions will not be imposed on FSGBank.
FSGBank is not currently in compliance with the capital requirements contained in the Order, which could adversely affect our financial condition and our results of operations.
The Order requires FSGBank to, within 120 days of the effective date of the Order, achieve and thereafter maintain total capital at least equal to 13.0% of risk-weighted assets and Tier 1 capital at least equal to 9.0% of adjusted total assets. Following the Recapitalization, on April 23, 2013, FSGBank filed a cash contribution to capital notice with the OCC certifying a $65.0 million capital contribution by the Company into FSGBank.  With that capital contribution, FSGBank's pro forma regulatory capital ratios increased substantially.  As of March 31, 2013, all pro forma regulatory capital measures exceeded the percentages of a well-capitalized institution as defined under applicable regulatory guidelines; however, FSGBank's Tier 1 leverage ratio continues to be below the 9.0% required in the Order.  FSGBank will continue to be classified as adequately capitalized due to the capital requirements in the Order.
We are subject to an Agreement with the Federal Reserve that could have a material negative effect on our business, operating flexibility, financial condition and the value of our common stock.
On September 7, 2010, the Company entered into an Agreement with the Federal Reserve. The Agreement places restrictions on the Company that are designed to enhance the Company's ability to act as a source of strength to FSGBank. Pursuant to the Agreement, the Company is prohibited from declaring or paying dividends without prior written consent from the Federal Reserve. In addition, pursuant to the Agreement, without the prior written consent of regulators, the Company is prohibited from taking dividends, or any other form of payment representing a reduction of capital, from FSGBank; incurring, increasing or guaranteeing any debt; or redeeming any shares of the Company's common stock. The Company will also provide quarterly written progress reports to the Federal Reserve.
18
The Company was also required to submit to the Federal Reserve a written plan designed to maintain sufficient capital at the Company, on a consolidated basis, and at FSGBank.
The Company submitted a copy of FSGBank's capital plan that had previously been submitted to FSGBank's primary regulator, the OCC.  During May 2013, the OCC requested updated capital and strategic plans based on the Recapitalization.  On July 1, 2013, FSGBank submitted capital and strategic plans to the OCC.  The plans were also submitted to the Federal Reserve by the Company.  We can give no assurance that the Federal Reserve or the OCC will approve our capital and strategic plans.
Although management believes the successful execution of the Recapitalization will improve our compliance with the Agreement and ultimately position the Company for long-term growth and a return to profitability, the Company is currently deemed not in compliance with provisions of the Agreement. Any material noncompliance may result in further enforcement actions by the Federal Reserve.
19
SUMMARY OF THE RECAPITALIZATION
On February 25, 2013, the Company entered into a number of agreements in connection with its $91.1 million Recapitalization, including the Stock Purchase Agreement.  Those agreements required the Company to issue and sell, in a Private Placement, 60,735,000 shares of common stock at the Purchase Price of $1.50 per share.  The closing of the Private Placement took place over two days, with the issuance of 9,941,908 shares of common stock to Treasury in exchange for 33,000 shares of the Company's TARP Preferred Stock, the TARP Warrant to purchase 82,363 shares of common stock, and all accrued but unpaid dividends on the TARP Preferred Stock, and the sale by Treasury of such shares of common stock to investors occurring on the TARP Closing Date of April 11, 2013, and the sale of 50,793,092 shares of common stock directly to investors occurring on the Investor Closing Date, April 12, 2013.
TARP Exchange
On February 25, 2013, the Company entered into an Exchange Agreement with Treasury, which held 33,000 shares of the TARP Preferred Stock and the TARP Warrant.  The Exchange Agreement required Treasury to exchange the TARP Preferred Stock and the TARP Warrant for a number of shares of common stock (the "Converted Shares") that, based on a price per share equal to the Purchase Price, represented a discount of 73.25% of the aggregate liquidation amount of the TARP Preferred Stock plus 100% of the accrued but unpaid dividends thereon through the TARP Closing Date (collectively, the "TARP Exchange").  Accordingly, on April 11, 2013, the Company issued 9,941,908 shares of common stock to the Treasury.  Immediately following the issuance of the Converted Shares to Treasury, Treasury sold the Converted Shares to certain investors identified by the Company at the Purchase Price pursuant to TARP Securities Purchase Agreements (the "Securities Purchase Agreements") between such investors, Treasury and the Company in private placement transactions exempt from registration under the Securities Act.
Stock Purchase Agreement
On February 25, 2013, the Company entered into a Stock Purchase Agreement (the "Stock Purchase Agreement") with certain institutional investors, including affiliates of EJF Capital LLC ("EJF"), GF Financial II, LLC ("GF Financial"), MFP Partners, L.P. ("MFP"), Ulysses Partners, L.P. ("Ulysses"), and the other investors named therein (collectively, the "Investors"), whereby EJF, GF Financial, MFP and Ulysses each agreed to purchase approximately $9.0 million of common stock at the Purchase Price.  The Stock Purchase Agreement provided that the Company could direct each Investor to purchase all or part of such Investor's committed investment from Treasury.  Investors purchased shares remaining from their committed investment directly from the Company.
Pursuant to the Stock Purchase Agreement, 60,735,000 shares of our common stock sold in the Recapitalization have been registered for resale on a registration statement on Form S-1 (File No. 333-188137) that was declared effective by the SEC on June 6, 2013. The investors in our Recapitalization are no longer subject to any lock-up agreements or any other contractual agreements not to dispose of our shares and these shares are freely transferable.
Subscription Agreements
Other accredited investors (the "Local Investors") executed subscription agreements ("Subscription Agreements"), pursuant to which they committed to purchase shares of common stock for the Purchase Price.  The Subscription Agreements provided that the Company could direct each Local Investor to purchase all or a portion of such Local Investor's committed investment from Treasury.
In aggregate, the Investors and Local Investors agreed to purchase approximately $91.1 million of common stock at $1.50 per share.  Accordingly, Investors and Local Investors purchased 9,941,908 shares from Treasury on April 11, 2013, and, on April 12, 2013, the Company sold 50,793,092 shares of common stock to the Investors and the Local Investors.
Gross-Up Rights
The Stock Purchase Agreement provides that each Investor acquiring 5.0% or more of the Company's outstanding common stock will hold gross-up rights by which they may purchase sufficient securities as to maintain their ownership percentage of the Company.  Any offering of securities by the Company that is not contemplated by the Stock Purchase Agreement will trigger these rights, and any purchase of securities by such Investors will be on the same or similar terms as those offered to other investors.  The gross-up rights terminate with respect to each Investor once such Investor no longer owns 5.0% or more of the Company's outstanding common stock.  As
20
provided in the Stock Purchase Agreement, the gross-up rights will not be triggered by the rights offering contemplated by this prospectus.
Changes to the Board of Directors
Pursuant to the Stock Purchase Agreement, MFP and Ulysses each designated an individual to serve as a director of the Company.  Accordingly, the Company has appointed the two designated directors to the Board.  The Company has agreed to continue to nominate the designated directors so long as the respective institutions retain ownership of at least 50% of their acquired shares.
The Stock Purchase Agreement also provides that each Investor that beneficially owns at least 5.0% of the Company's outstanding common stock may designate an individual to attend meetings of the Board of Directors as a non-voting observer (the "Observer").  The right of each Investor to appoint an Observer terminates once such Investor no longer owns 5.0% or more of the Company's outstanding common stock.
The foregoing summary of the documents relating to the Recapitalization are not complete and are qualified in their entirely by reference to the full text of such documents, copies of which are included as exhibits to the Company's Current Report on Form 8-K filed on February 26, 2013 and are incorporated by reference herein.   See "Where You Can Find More Information" and "Incorporation of Certain Information by Reference."
USE OF PROCEEDS
The total proceeds to us from the rights offering will depend on the number of subscription rights that are exercised.  If we issue all 3,329,234 shares of common stock available in the rights offering, the total gross proceeds to us, before dealer management fees and expenses, will be approximately $5.0 million.  We estimate that the dealer manager fees will be approximatel
y $300,000 and the other expenses of the rights offering will be approximately $225,000, resulting in estimated net proceeds to us, assuming that all of the shares available in the rights offering are sold, of approximately $4.475 mill
ion.  The net proceeds may vary since total expenses of the rights offering may be more or less than those estimated and since the number of shares sold may be less than estimated. We intend to use the net proceeds from the rights offering to supplement the capital of First Security and for general corporate purposes.
Because there is no minimum number of shares that must be sold in the rights offering, we can provide no assurance regarding the amount of capital we will actually raise in the rights offering.
21
CAPITALIZATION
The following table sets forth our capitalization and regulatory capital ratios at March 31, 2013 and as adjusted to reflect: (1) the completion of the Recapitalization and (2) the sale of the maximum 3,329,234 shares of our common stock at the subscription price of $1.50 per share and the receipt of the net proceeds from the rights offering after deducting estimated dealer manager fees of approxim
ately $300,000 and other offering expenses in the amount of $225,000.  The table does not reflect the use of p
roceeds from the Recapitalization or the rights offering.  The information presented in the table below should be read in conjunction with the consolidated financial statements and notes thereto incorporated by reference into this prospectus.
Actual as of March 31, 2013
As Adjusted for the Recapitalization
As Further Adjusted for Rights Offering
1
(in thousands, except per share information)
Shareholders' Equity
Preferred Stock – no par value – 10,000,000 shares authorized; 33,000 issued as of March 31, 2013; Liquidation value of $38,569 as of March 31, 2013
$
32,660
$
—
$
—
Common Stock – $.01 par value – 150,000,000 shares authorized; 1,772,342 shares issued as of March 31, 2013
115
722
755
Paid-in surplus
106,622
192,027
196,469
Common stock warrants
2,006
—
—
Accumulated deficit
(123,293
)
(97,565
)
(97,565
)
Accumulated other comprehensive income
2,884
2,884
2,884
Total shareholders' equity
$
20,994
$
98,068
$
102,543
Number of common shares outstanding
1,772
62,423
65,753
Book value per share
$
11.85
$
1.57
$
1.56
1
Assumes that all shares available in the rights offering are sold.
March 31, 2013
Estimated Impact of Recapitalization
Estimated Impact of Rights Offering
1
Pro-forma
2
Minimum to be Well Capitalized under Prompt Corrective Action Provisions
3
Company Capital Levels
Tier 1 capital
17,584
77,074
4,475
99,133
Total risk-based capital
24,967
77,074
4,475
106,516
Tier 1 leverage capital ratio
1.68
%
9.47
%
n/a
Total risk-based capital ratio
4.27
%
18.23
%
n/a
FSGBank Capital Levels
Tier 1 capital
19,932
65,000
4,475
89,407
Total risk-based capital
27,313
65,000
4,475
96,788
Tier 1 leverage capital ratio
1.90
%
8.54
%
5.00
%
Total risk-based capital ratio
4.68
%
16.57
%
10.00
%
1
Assumes that all shares available in the rights offering are sold.
2
Includes both the Estimated Impact of Recapitalization and the Estimated Impact of Rights Offering, assuming that all shares available in the rights offering are sold.
3
FSGBank continues to operate under a Consent Order with heightened capital adequacy requirements.  The Consent Order requires FSGBank to maintain a Tier 1 leverage capital ratio of 9.0% and total risk-based capital ratio of 13.0%.  Accordingly, FSGBank would be considered "adequately capitalized" based on the estimated pro-forma capital levels.
22
MARKET FOR THE COMMON STOCK AND DIVIDEND INFORMATION
From August 10, 2005 to March 26, 2013, our common stock traded on the NASDAQ Global Select Market under the symbol FSGI.  As previously disclosed, we were not in compliance with the continued listing requirements of the NASDAQ Global Select Market and were subject to delisting after March 25, 2013.  As a result, we applied to transfer our listing to the NASDAQ Capital Market.  Our application was granted effective March 26, 2013, subject to certain conditions described in the Current Report on Form 8-K filed March 22, 2013, which is incorporated herein by reference.  On July 2, 2013, there were 670 registered holders of our common stock.  The high and low closing prices per share of our common stock for the periods indicated below were as follows:
Quarter
High
Low
2013
3rd Quarter (through _____)
$
$
2
nd
Quarter
6.24
1.96
1st Quarter
3.44
1.60
2012
4
th
Quarter
3.04
1.30
3
rd
Quarter
3.30
2.15
2
nd
Quarter
3.35
1.98
1
st
Quarter
3.68
2.35
2011
4
th
Quarter
3.34
1.13
3
rd
Quarter
5.70
1.81
2
nd
Quarter
9.10
4.61
1
st
Quarter
13.00
8.10
The closing sale price of our common stock as reported on the NASDAQ Capital Market on July 2, 2013 was $2.16 per share.
23
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Security Ownership of Certain Beneficial Owners
The following table indicates, as of June 15, 2013, the number of shares of common stock beneficially owned by each greater than five percent holder of the Company's outstanding voting securities, each executive officer and director and all executive officers and directors, as a group.
Name of Shareholder
Number of Shares Owned Prior to the Rights Offering (1)
Percentage of Outstanding Common Stock owned Prior to the Rights Offering (2)
Affiliates of EJF Capital LLC: (3)
8267561 Canada, Inc.
118,574
HHMI VII, LLC
282,827
EJF Financial Opportunities Master Fund, LP
157,938
EJF Debt Opportunities Master Fund II, LP
2,006,896
EJF Debt Opportunities Master Fund, LP
2,588,145
EJF Financial Services Fund, LP
925,620
Subtotal
6,080,000
9.7
MFP: (4)
MFP Partners, LP
6,080,000
9.7
GF Financial: (5)
GF Financial II, LLC
6,080,000
9.7
Affiliates of Ulysses: (6)
Ulysses Partners, LP
5,130,000
---
Ulysses Offshore Fund, Ltd
870,000
---
Subtotal
6,000,000
9.7
Directors and Executive Officers:
Henchy R. Enden (7)
Director
500
*
William F. Grant, III (8)
Director
44,309
*
William C. Hall (9)
Director
16,968
*
Adam G. Hurwich (10)
Director
1,000
*
Carol H. Jackson (11)
Director
63,786
*
Kelly P. Kirkland (12)
Director
18,347
*
D. Michael Kramer (13)
President, CEO and Director
112,202
*
Robert R. Lane (14)
Director
21,950
*
Larry D. Mauldin (15)
Director
170,650
*
Denise M. Cobb (16)
Executive Vice President and Chief Administrative Officer
24,756
*
John R. Haddock (17)
Executive Vice President, Chief Financial Officer
and Secretary
75,421
*
Christopher G. Tietz (18)
Executive Vice President and Chief Credit Officer
90,053
*
All directors and officers as a group (19)
639,942
1.0
24
*
Less than one percent of outstanding shares.
(1)
Some or all of the shares may be subject to margin accounts.
(2)
Assumes the full exercise of the subscription rights in the Rights Offering.  The percentage of our common stock beneficially owned was calculated based on 62,428,367 shares of common stock issued and outstanding as of June 15, 2013.  The percentage assumes the exercise by the shareholder or group named in each row of all options for the purchase of our common stock held by such shareholder or group and exercisable within 60 days of June 15, 2013.
(3)
Each of EJF Debt Opportunities Master Fund, L.P., EJF Debt Opportunities Master Fund II, LP, EJF Financial Services Fund, LP and EJF Financial Opportunities Master Fund, LP is the record owner of the shares indicated.  EJF Debt Opportunities GP, LLC serves as the general partner and investment manager of EJF Debt Opportunities Master Fund, L.P. and may be deemed to share beneficial ownership of the shares of Common Stock of which EJF Debt Opportunities Master Fund, L.P. is the record owner. EJF Debt Opportunities II GP, LLC serves as the general partner and investment manager of EJF Debt Opportunities Master Fund II, LP and may be deemed to share beneficial ownership of the shares of common stock of which EJF Debt Opportunities Master Fund II, LP is the record owner.  EJF Financial Services GP, LLC serves as the general partner and investment manager of EJF Financial Services Fund, LP and may be deemed to share beneficial ownership of the shares of common stock of which EJF Financial Services Fund, LP is the record owner. EJF Financial Opportunities GP, LLC serves as the general partner of EJF Financial Opportunities Master Fund, LP and may be deemed to share beneficial ownership of the shares of common stock of which EJF Financial Opportunities Master Fund, LP is the record owner.  EJF Capital LLC is the sole member and manager of each of EJF Debt Opportunities GP, LLC, EJF Debt Opportunities II GP, LLC, EJF Financial Services GP, LLC and EJF Financial Opportunities GP, LLC, and may be deemed to share beneficial ownership of the shares of common stock of which such entities may share beneficial ownership.  EJF Capital LLC also serves as the investment manager of EJF Financial Opportunities Master Fund, LP and certain managed accounts and consequently may be deemed to share beneficial ownership of the shares held of record by EJF Financial Opportunities Master Fund, LP , 8267561 Canada, Inc. and HHMI VII, LLC. Emanuel J. Friedman is the controlling member of EJF Capital LLC and may be deemed to share beneficial ownership of the shares of common stock over which EJF Capital LLC may share beneficial ownership.  The address of each EJF affiliate is 2107 Wilson Boulevard, Suite 410, Arlington, VA 22201.
(4)
MFP Partners, LP, a Delaware limited partnership ("MFP"), is the record holder of the shares indicated.  MFP Investors LLC, a Delaware limited liability company and general partner of MFP ("MFP Investors"), and Michael F. Price, managing partner of MFP and the managing member and controlling person of MFP Investors (the "MFP Reporting Persons").  Due to their respective relationships with MFP and each other, each of the MFP Reporting Persons may be deemed to share voting and dispositive power with respect to the shares presented.  The address of the MFP Reporting Persons is 667 Madison Avenue, 25th Floor, New York, New York 10065.
(5)
GF Financial II, LLC a Delaware limited liability company ("GFF II"), is the record holder of the shares indicated.  Diaco Investments, L.P., is a Delaware limited partnership and 100% owner of GFF II ("Diaco"), Siget, LLC, is a Delaware limited liability company and general partner of Diaco ("Siget"), Simon Glick is a managing member of Siget and Seymour Pluchenik is a managing member of Siget.  Each of the foregoing may be deemed to share voting and dispositive power with respect to the shares held by GFF II.  The address of each GFF II affiliate is 810 Seventh Avenue, 28th Floor, New York, New York 10019.
(6)
Ulysses Management LLC is a Delaware limited liability company ("Ulysses Management"), Ulysses Partners, L.P., is a Delaware limited partnership ("Ulysses Partners"), Ulysses Offshore Fund, Ltd, is an exempted company incorporated and existing under the laws of the Cayman Islands ("Ulysses Offshore"), Joshua Nash LLC, is a Delaware limited liability company ("Nash LLC"), and Joshua Nash is a United States citizen.  Ulysses Management, in its capacity as investment manager, may be deemed to share voting and investment power over the 5,130,000 shares beneficially owned by Ulysses Partners and the 870,000 shares beneficially owned by Ulysses Offshore, Nash LLC, as the managing general partner of Ulysses Partners, may be deemed to share voting and investment power over the 5,130,000 shares beneficially owned by Ulysses Partners, and Mr. Nash, as an executive of Ulysses Management, the sole member of Nash LLC and the President of Ulysses Offshore, may be deemed to share voting and investment power over the 6,000,000 shares beneficially owned by Ulysses Management and the 5,130,000 shares beneficially owned by Ulysses Partners and Ulysses Offshore.  The address of each Ulysses Management affiliate is c/o Ulysses Management LLC, One Rockefeller Plaza, New York, New York  10020.
(7)
All shares directly owned by Ms. Enden.
(8)
Includes 1,650 shares that Mr. Grant has the right to acquire by exercising options that are exercisable within 60 days after June 15, 2013.  All other shares directly owned by Mr. Grant.
(9)
Includes 120 shares subject to restricted stock awards and 1,848 shares that Mr. Hall has the right to acquire by exercising options that are exercisable within 60 days after June 15, 2013. All other shares directly owned.
(10)
All shares directly owned by Mr. Hurwich.
(11)
Includes 666 shares owned by Ms. Jackson's spouse and 509 shares owned by an IRA for the benefit of Ms. Jackson; also includes 5,370 shares that Ms. Jackson has the right to acquire by exercising options that are exercisable with 60 days after June 15, 2013. All other shares directly owned.
25
(12)
Includes 1,650 shares that Ms. Kirkland has the right to acquire by exercising options that are exercisable within 60 days after June 15, 2013.  All other shares directly owned by Ms. Kirkland.
(13)
Includes 1,452 shares held in First Security's 401(k) plan and also includes 8,750 shares subject to restricted stock awards.  All other shares directly owned.
(14)
Includes 1,650 shares that Mr. Lane has the right to acquire by exercising options that are exercisable within 60 days after June 15, 2013.  All other shares directly owned by Mr. Lane.
(15)
Includes 10,000 shares subject to restricted stock awards.  Also includes 1,650 shares that Mr. Mauldin has the right to acquire by exercising options that are exercisable within 60 days after June 15, 2013.  All other shares directly owned by Mr. Mauldin.
(16)
Includes 1,706 shares held in First Security's 401(k) plan and also includes 2,500 shares subject to restricted stock awards.  Additionally, Ms. Cobb has the right to acquire 550 shares by exercising options that are exercisable within 60 days after June 15, 2013. All other shares directly owned.
(17)
Includes 1,716 shares held in First Security's 401(k) plan and also includes 2,500 shares subject to restricted stock awards. Additionally, Mr. Haddock has the right to acquire 805 shares by exercising options that are exercisable within 60 days after June 15, 2013. All other shares directly owned.
(18)
Includes 1,634 shares owned by a trust controlled by Mr. Tietz and also includes 7,500 shares subject to restricted stock awards. All other shares directly owned.
(19)
Includes 15,173 shares that the owner has the right to acquire by exercising options that are exercisable within 60 days after June 15, 2013.
SUBSCRIPTIONS BY DIRECTORS AND EXECUTIVE OFFICERS
As of April 10, 2013, our current directors and executive officers owned approximately 142,019 shares of our common stock.  Due to the number of outstanding shares of our common stock as of the record date of the rights offering, in order to facilitate the Company's compliance with the $5,000,000 maximum rights offering amount imposed by the Stock Purchase Agreement and still offer each Pre-Recapitalization Shareholder the right to purchase two shares of our common stock, five of the Company's directors and executive officers holding an aggregate of 23,750 shares on the record date have waived their right to participate in the rights offering.  In addition, 63,750 of the shares of restricted stock owned by directors and executive officers as of the record date were forfeited and are not eligible to participate in the rights offering.  As a result, our directors and executive officers collectively hold rights to purchase 109,038 shares of our common stock in the rights offering.  Certain of our directors and executive officers have indicated an interest in participating in the rights offering.  Collectively, we expect our directors and executive officers to purchase approximately
shares of our common stock in the rights offering, subject to change.  Our directors and executive officers are entitled to participate in the rights offering on the same terms and conditions applicable to all other Pre-Recapitalization Shareholders.  Following the rights offering, our current directors and executive officers, to
gether with their affiliates, are expected to beneficially own
shares of common stock, or approximately
% of o
ur outstanding common stock, assuming that all shares are subscribed for in the rights offering and that no directors, executive officers or their affiliates participate in the oversubscription aspect of the rights offering.  See "Security Ownership of Certain Beneficial Owners And Management."
26
THE RIGHTS OFFERING
Subscription Rights
We are distributing to the holders of shares of our common stock as of April 10, 2013, the record date, non-transferable subscription rights to purchase shares of our common stock at $1.50 per share.  The subscription rights entitle the holders of our common stock to purchase up to an aggregate of approximately 3,329,234 shares of our common stock for an aggregate purchase price of approximately $5.0 million.
Each holder of record of our common stock will receive one subscription right for each share of our common stock owned by such holder as of 5:00 p.m., Eastern Time, on April 10, 2013.  Each subscription right entitles the holder to a basic subscription privilege and an over-subscription privilege.
Basic Subscription Privilege.
With your basic subscription privilege, you may purchase two shares of our common stock for each share of common stock that you owned as of the record date, subject to delivery of the required documents and payment of the subscription price of $1.50 per share prior to the expiration of the rights offering.  You may exercise all or a portion of your basic subscription privilege. However, if you exercise less than your full basic subscription privilege, you will not be entitled to purchase shares under your over-subscription privilege.
Over-Subscription Privilege.
In the event that you purchase all of the shares of common stock available to you pursuant to your basic subscription privilege, you may also choose to purchase a portion of any shares of our common stock that are not purchased by other shareholders through the exercise of their basic subscription privileges.  If sufficient shares of common stock are available, we will seek to honor the over-subscription requests in full.  If, however, over-subscription requests exceed the number of shares of common stock available, we will allocate the available shares of common stock pro rata based on the relative ownership percentages as of the record date of shareholders requesting additional shares.  We may exercise our discretion to round down to allocate shares in ten share increments.  As described above for the basic subscription privilege, we will not issue fractional shares through the exercise of over-subscription privileges.
In order to properly exercise your over-subscription privilege, you must deliver the subscription payment related to your over-subscription privilege at the time you deliver payment related to your basic subscription privilege.  Because we will not know the actual number of unsubscribed shares prior to the expiration of the rights offering, if you wish to maximize the number of shares you purchase pursuant to your over-subscription privilege, you will need to deliver payment in an amount equal to the aggregate subscription price for the maximum number of shares of our common stock that may be available to you.
We can provide no assurances that you will be able to purchase the number of shares issuable upon the exercise of your over-subscription privilege in full.
We will not be able to satisfy any orders for shares pursuant to the over-subscription privilege if all of our shareholders exercise their basic subscription privileges in full.  We can only honor an over-subscription privilege to the extent sufficient shares of our common stock are available following the exercise of subscription rights under the basic subscription privileges.
To the extent the aggregate subscription price of the actual number of unsubscribed shares available to you pursuant to the over-subscription privilege is less than the amount you paid in connection with the exercise of the over-subscription privilege, you will be allocated only the number of unsubscribed shares actually available to you, and any excess subscription payments will be returned to you, without interest, as soon as practicable.
To the extent the amount you paid in connection with the exercise of the over-subscription privilege is less than the aggregate subscription price of the actual number of unsubscribed shares available to you pursuant to the over-subscription privilege, you will be allocated the number of unsubscribed shares for which you actually paid in connection with the over-subscription privilege.
Reasons for the Rights Offering
On February 25, 2013, the Company entered into a number of agreements in connection with a $91.1 million Recapitalization, including a Stock Purchase Agreement by and among the Company and the investors named therein.  Those agreements required the Company to issue and sell, in a Private Placement, approximately 60,735,000 shares of common stock at the Purchase Price of $1.50 per share.  The closing of the Private Placement occurred over two days, with the issuance of 9,941,908 shares of common stock to Treasury in exchange for 33,000
27
shares of the Company's TARP Preferred Stock, the TARP Warrant to purchase 82,363 shares of common stock,  and all accrued but unpaid dividends on the TARP Preferred Stock, and the sale by Treasury of such shares of common stock to investors occurring on the TARP Closing Date of April 11, 2013, and the sale of 50,793,092 shares of common stock directly to investors occurring on the Investor Closing Date, April 12, 2013.
As required by the Stock Purchase Agreement, we are conducting this rights offering to holders of our common stock as of April 10, 2013, the Pre-Recapitalization Shareholders, to provide the Pre-Recapitalization Shareholders with the opportunity to purchase approximately $5 million of our common stock at a purchase price per share equal to the Purchase Price.
Method of Exercising Subscription Rights
One non-transferable subscription right to purchase two shares of our common stock is being distributed for each share of our common stock that you owned as of 5:00 p.m., Eastern Time, on April 10, 2013.  Once exercised, the subscription rights are irrevocable and may not be cancelled or modified.  You may exercise your subscription rights as follows:
Subscription by Registered Holders.
If you hold a First Security stock certificate, the number of rights you may exercise pursuant to your basic subscription privilege is indicated on the enclosed rights certificate.  You may exercise your subscription rights by properly completing and executing the rights certificate and forwarding it, together with your full payment, to the subscription agent at the address set forth below under "—Subscription Agent," to be received prior to the 5:00 p.m., Eastern Time,
___________,
2013 expiration date that we have established for the rights offering.
Subscription by Beneficial Owners.
If you are a beneficial owner of shares of our common stock that are registered in the name of a broker, custodian bank or other nominee, you will not receive a rights certificate.  Instead, one subscription right will be issued to the nominee record holder for each share of our common stock that you owned at the record date. If you are not contacted by your nominee, you should promptly contact your nominee in order to subscribe for shares of our common stock in the rights offering.
If you hold your shares of common stock in the name of a custodian bank, broker, dealer or other nominee, your nominee will exercise the subscription rights on your behalf in accordance with your instructions. Your nominee may establish a deadline that may be before the 5:00 p.m., Eastern Time,
___________, 2013
expiration date that we have established for the rights offering.
If the rights are attributable to shares that were held in your account in the 401(k) Plan, you must provide your instructions to the tabulator selected by
the 401(k) Plan's trustee by no later than the date and time specified in the separate instructions applicable to those shares.
Payment Method
As described in the instructions accompanying the rights certificate, payments submitted to the subscription agent must be made in full United States currency by:
•
personal check payable to Registrar and Transfer Company, our subscription agent, drawn upon a United States bank;
•
bank check or bank draft payable to Registrar and Transfer Company, drawn upon a United States bank;
•
postal, telegraphic or express money order payable to Registrar and Transfer Company; or
•
wire transfer of immediately available funds to the account maintained by Registrar and Transfer Company.
If you are issued subscription rights attributable to shares that were held in your account in the 401(k) Plan, the payment for the exercise of the subscription rights will be deducted from funds held in your account in the 401(k) Plan as described in more detail in the separate instructions applicable to those subscription rights.
You should read and follow the instructions accompanying the rights certificate carefully.  As described in the instructions accompanying the rights certificate, in certain cases additional documentation or signature guarantees may be required.
28
The method of delivery of payments of the subscription amount to the subscription agent will be at the risk of the holders of subscription rights. If sent by mail, we recommend that you send those documents and payments by registered mail, properly insured, with return receipt requested, and that a sufficient number of days be allowed to ensure delivery to the subscription agent.  Do not send or deliver these materials to us or to the dealer manager.
There is no sales fee or commission payable by you.  We will pay all fees charged by the subscription and information agent and our advisors. You are responsible for paying any other commissions, fees, taxes or other expenses incurred in connection with the exercise of the subscription rights.
Medallion Guarantee May Be Required
Your signature on your rights certificate must be guaranteed by an eligible institution, such as a member firm of a registered national securities exchange or a member of the Financial Industry Regulatory Authority, or a commercial bank or trust company having an office or correspondent in the United States, subject to standards and procedures adopted by the subscription agent, unless:
•
you provide on the rights certificate that shares are to be delivered in your name and to your address of record, as imprinted on the face of the rights certificate; or
•
you are an eligible institution.
Limit on How Many Shares of Common Stock You May Purchase in the Rights Offering
Subject to the discretion of the board of directors, a person, together with certain related persons and associates, may not purchase a number of shares such that upon completion of the rights offering the person owns securities representing in excess of 4.9% of our outstanding common stock.
In addition, we will not issue shares of our common stock pursuant to the exercise of basic subscription rights or over-subscription rights to any person or entity who, in our sole opinion, could be required to obtain prior clearance or approval from or submit a notice to any state or federal bank regulatory authority to acquire, own or control such shares if, as of
___________,
2013, we determine that such clearance or approval has not been obtained and/or any applicable waiting period has not expired. If we elect not to issue shares in such a case, the unissued shares will become available to satisfy over-subscription by other shareholders pursuant to their subscription rights.
The term "associate" is used above to indicate any of the following relationships with a person:
•
any corporation or organization, other than First Security or a subsidiary thereof, of which a person is a senior officer or partner, or beneficially owns, directly or indirectly, 10% or more of any class of equity securities of the corporation or organization;
•
any trust or other estate, if the person has a substantial beneficial interest in the trust or estate or is a trustee or fiduciary of the estate (although a person who has a substantial beneficial interest in one of our tax-qualified or non-tax-qualified employee plans, or who is a trustee or fiduciary of the plan is not an associate of the plan, and our tax-qualified employee plans are not associates of a person);
•
any person who is related by blood or marriage to such person and:
(i)
who lives in the same house as the person; or
(ii)
who is a director or senior officer of First Security or a subsidiary thereof; and
•
any person acting in concert with the persons or entities specified above.
As used above, the term "acting in concert" means:
•
knowing participation in a joint activity or interdependent conscious parallel action towards a common goal, whether or not pursuant to an express agreement; or
•
a combination or pooling of voting or other interests in the securities of an issuer for a common purpose pursuant to any contract, understanding, relationship, agreement or other arrangement, whether written or otherwise.
29
A person or company that acts in concert with another person or company ("other party") shall also be deemed to be acting in concert with any person or company who is also acting in concert with that other party, except that any of our tax-qualified employee plans will not be deemed to be acting in concert with its trustee or a person who serves in a similar capacity solely for the purpose of determining whether stock held by the trustee and stock held by the plan will be aggregated.
Missing or Incomplete Subscription Information
If you send a payment that is insufficient to purchase the number of shares you requested, or if the number of shares you requested is not specified in the forms, the payment received will be applied to exercise your subscription rights to the fullest extent possible based on the amount of the payment received, subject to the availability of shares under the over-subscription privilege and the elimination of fractional shares.  Any excess subscription payments received by the subscription agent will be returned, without interest, as soon as practicable following the expiration of the rights offering.
Expiration Date
The subscription period, during which you may exercise your subscription rights, expires at 5:00 p.m., Eastern Time, on ___________, 2013, which is the expiration of the rights offering.  If you do not exercise your subscription rights prior to that time, your subscription rights will expire and will no longer be exercisable.  We will not be required to issue shares of our common stock to you if the subscription agent receives your rights certificate or your subscription payment after that time.  We have the option to extend the rights offering without notice to you. In no event will the expiration date be later
than ___________,
2013.  We may extend the expiration of the rights offering by giving oral or written notice to the subscription agent prior to the expiration of the rights offering.  If we elect to extend the expiration of the rights offering, we will issue a press release announcing such extension no later than the next business day after the board of directors determines to extend the rights offering.
If you hold your shares of common stock in the name of a custodian bank, broker, dealer or other nominee, your nominee will exercise the subscription rights on your behalf in accordance with your instructions.  Your nominee may establish a deadline that may be before the 5:00 p.m., Eastern Time,
___________, 2013
, expiration date that we have established for the rights offering.
If the subscription rights are attributable to shares that were held in your account in the 401(k) Plan, you must provide your instructions to the tabulator selected by the 401(k) Plan's trustee in the form required by the tabulator by no later than the date and time specified in the separate instructions applicable to those shares.
Determination of Subscription Price
As required by the Stock Purchase Agreement, we are conducting this rights offering to provide our Pre-Recapitalization Shareholders with the opportunity to purchase up to 3,329,234 shares of our common stock at a purchase price per share of $1.50, the same price per share paid by investors in the Recapitalization.  The subscription price is not necessarily related to our book value, net worth or any other established criteria of value and may or may not be considered the fair value of our common stock to be offered in the rights offering.
We cannot assure you that the market price of our shares of common stock will not decline during or after the rights offering. We also cannot assure you that you will be able to sell shares of our common stock purchased during the rights offering at a price equal to or greater than the subscription price.  We urge you to obtain a current quote for our common stock before exercising your subscription rights.
Termination
We may, in our sole discretion and for any reason, terminate the rights offering at any time prior to the completion of the rights offering.  If we terminate the rights offering, all affected subscription rights will expire without value, and neither we nor the dealer manager and the subscription agent will have any obligation to you with respect to the subscription rights except to return any exercise payment received by the subscription agent, without interest or penalty.
Subscription Agent
The subscription agent for the rights offering is Registrar and Transfer Company.  The address to which rights certificates and payments, other than wire transfers, should be mailed or delivered is provided below.  If sent
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by mail, we recommend that you send documents and payments by registered mail, properly insured, with return receipt requested, and that a sufficient number of days be allowed to ensure delivery to the subscription agent.  Do not send or deliver these materials to First Security or the dealer manager.
Registrar and Transfer Company
___________
___________
If you have any questions regarding completing a rights certificate or submitting payment in the rights offering, please call our subscription agent for the rights offering, Registrar and Transfer Company, at ___________, Monday through Friday (except bank holidays), between ___ a.m. and ___ p.m., ___________ T
ime.
Dealer Manager
We have appointed Raymond James & Associates, Inc. as dealer manager for the rights offering.  Any questions or requests regarding First Security or the rights offering may be directed to Raymond James & Associates, Inc., at 404-240-2907 (or toll-free at 866-777-7789), attention: Sanjay Patel, Monday through Friday (except bank holidays), between 9:00 a.m. and 5:00 p.m., Eastern Standard Time. Banks and brokers may contact Raymond James & Associates, Inc., at the number above.  We will pay the fees and expenses of the dealer manager and have also agreed to indemnify the dealer manager from certain liabilities that it may incur in connection with the rights offering.
No Fractional Shares
All shares will be sold at a purchase price of $1.50 per share.  We will not issue fractional shares.  Fractional shares of our common stock resulting from the exercise of the basic subscription privileges and the over-subscription privileges will be eliminated by rounding down to the nearest whole share.  Any excess subscription payments received by the subscription agent will be returned, without interest, as soon as practicable.
Notice to Nominees
If you are a broker, custodian bank or other nominee holder that holds shares of our common stock for the account of others on the record date, you should notify the beneficial owners of the shares for whom you are the nominee of the rights offering as soon as possible to learn their intentions with respect to exercising their subscription rights.  You should obtain instructions from the beneficial owners, as set forth in the instructions we have provided to you for your distribution to beneficial owners.  If a registered holder of our common stock so instructs, you should complete the rights certificate and submit it to the subscription agent with the proper subscription payment to be received by the expiration date.  You may exercise the number of subscription rights to which all beneficial owners in the aggregate otherwise would have been entitled had they been direct holders of our common stock on the record date, provided that you, as a nominee record holder, make a proper showing to the subscription agent by submitting the form entitled "Nominee Holder Certification," which is provided with your rights offering materials.  If you did not receive this form, you should contact the subscription agent to request a copy.
Beneficial Owners
If you are a beneficial owner of shares of our common stock and will receive your subscription rights through a broker, custodian bank or other nominee, we will ask your nominee to notify you of the rights offering.  If you wish to exercise your subscription rights, you will need to have your broker, custodian bank or other nominee act for you, as described above.  To indicate your decision with respect to your subscription rights, you should follow the instructions of your nominee. If you wish instead to obtain a separate rights certificate, you should contact your nominee as soon as possible and request that a rights certificate be issued to you.  You should contact your nominee if you do not receive notice of the rights offering, but you believe you are entitled to participate in the rights offering.  We are not responsible if you do not receive the notice by mail or otherwise from your nominee or if you receive notice without sufficient time to respond to your nom
inee by the deadline established by your nominee, which may be before the 5:00 p.m., Eastern Time, ___________,
2013 expiration date that we have established for the rights offering.
If you were a beneficial owner of shares of our common stock through the 401(k) Plan as of the record date, subscription rights attributable to shares held in your account in the 401(k) Plan will be issued to your account in the 401(k) Plan.  You will need to notify the tabulator selected by the trustee for the 401(k) Plan if you wish to
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exercise your subscription rights.  To indicate your decision with respect to those subscription rights, you should follow the separate instructions provided by the tabulator.  You should contact the tabulator if you do not receive notice of the rights offering, but you believe you are entitled to participate in the rights offering based on stock that you held in the 401(k) Plan as of 5:00 p.m. Eastern Time on April 10, 2013.  You must respond to the tabul
ator by the deadline established by the tabulator, which may be before the 5:00 p.m., Eastern Time, ___________,
2013, expiration date.  The deadline and any special instructions will be included in separate instructions issued to you with respect to those subscription rights.  Those instructions only apply to subscription rights issued to your account in the 401(k) Plan.  Therefore, if you have subscription rights issued to your account in the 401(k) Plan and subscription rights issued with respect to other stock you held, you will need to provide separate instructions, and potentially comply with separate deadlines, with respect to those subscription rights.
Non-Transferability of Subscription Rights
The subscription rights granted to you are non-transferable and, therefore, you may not sell, transfer or assign your subscription rights to anyone. The subscription rights will not be quoted on the NASDAQ Capital Market or any other stock exchange or market.  The shares of our common stock issuable upon exercise of the subscription rights will be traded on the NASDAQ Capital Market under the ticker symbol "FSGI."
Validity of Subscriptions
We will resolve all questions regarding the validity and form of the exercise of your subscription rights, including time of receipt and eligibility to participate in the rights offering.  Our determination will be final and binding.  Once made, subscriptions and directions are irrevocable, and we will not accept any alternative, conditional or contingent subscriptions or directions.  We reserve the absolute right to reject any subscriptions or directions not properly submitted or the acceptance of which would be unlawful. You must resolve any irregularities in connection with your subscriptions before the subscription period expires, unless waived by us in our sole discretion.  Neither we nor the subscription agent shall be under any duty to notify you or your representative of defects in your subscriptions.  A subscription will be considered accepted, subject to our right to withdraw or terminate the rights offering, only when a properly completed and duly executed rights certificate and any other required documents and the full subscription payment have been received by the subscription agent.  Our interpretations of the terms and conditions of the rights offering will be final and binding.
Escrow Arrangements; Return of Funds
The subscription agent will hold funds received in payment for shares of our common stock in a segregated account pending completion of the rights offering.  The subscription agent will hold this money in escrow until the rights offering is completed or is withdrawn and canceled.  If the rights offering is canceled for any reason, all subscription payments received by the subscription agent will be returned promptly, without interest or penalty.
Shareholder Rights
You will have no rights as a holder of the shares of our common stock you purchase in the rights offering until certificates representing the shares of our common stock are issued to you, or your account at your nominee is credited with the shares of our common stock purchased in the rights offering.
Foreign Shareholders
We will not mail this prospectus or rights certificates to shareholders with addresses that are outside the United States or that have an army post office or foreign post office address.  The subscription agent will hold these rights certificates for the account of such shareholders.  To exercise subscription rights, our foreign shareholders must notify the subscription agent prior to 5:00 p.m., Eastern Time, at least three business days prior to the expiration of the rights offering (or, if the rights offering is extended, on or before three business days prior to the extended expiration date) and demonstrate to the satisfaction of the subscription agent that the exercise of such subscription rights does not violate the laws of the jurisdiction of such shareholder.
No Revocation or Change
Once you submit the rights certificate or have instructed your nominee of your subscription request, you are not allowed to revoke or change the exercise or request a refund of monies paid.  All exercises of subscription rights are irrevocable, even if you learn information about us that you consider to be unfavorable.  However, with respect
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to subscription rights issued to your account in the 401(k) Plan, if the market price of the stock is less than the subscription price on the date the subscription rights are exercised, the trustee will not execute your instructions to purchase the common stock and your money will be refunded to your account in the 401(k) Plan. You should not exercise your subscription rights unless you are certain that you wish to purchase additional shares of our common stock at the subscription price.
Purchase Limitations
Subject to the discretion of the board of directors, a person, together with certain related persons and associates, may not purchase a number of shares such that upon completion of the rights offering the person owns securities representing in excess of 4.9% of our outstanding common stock.  Additionally, federal law generally requires prior regulatory approval for any person or persons acting in concert to acquire 10% or more of our common stock.  We will not issue shares of our common stock pursuant to the exercise of basic subscription rights or over-subscription rights to any person or entity who, in our sole opinion, could be required to obtain prior clearance or approval from or submit a notice to any state or federal bank regulatory authority to acquire, own or control such shares if, as of
___________, 2013
, we determine that such clearance or approval has not been obtained and/or any applicable waiting period has not expired. If we elect not to issue shares in such a case, the unissued shares will become available to satisfy over-subscription elections by other shareholders pursuant to their subscription rights.
Material U.S. Federal Income Tax Treatment of Rights Distribution
For U.S. federal income tax purposes, you should not recognize income or loss upon the receipt, exercise or lapse of the subscription rights for the reasons described below in "Material U.S. Federal Income Tax Consequences."
No Recommendation to Rights Holders
Our board of directors is making no recommendation regarding your exercise of the subscription rights.  Shareholders who exercise subscription rights risk investment loss on new money invested.  We cannot assure you that the market price for our common stock will be above the subscription price or that anyone purchasing shares at the subscription price will be able to sell those shares in the future at the same price or a higher price.  You are urged to make your decision based on your own assessment of our business and the rights offering.  Please see the "Risk Factors" section of this prospectus and the information incorporated by reference herein and contained in the section entitled "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2012 and any risks described in our other filings with the SEC pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act for a discussion of some of the risks involved in investing in our common stock.
Shares of Our Common Stock Outstanding After the Rights Offering
As of April 10, 2013, 1,795,542
shares of our common stock were issued and outstanding.  On April 11, 2013 and April 12, 2013, the date following the record date for the rights offering, we issued an additional 60,735,000 shares of common stock in the Recapitalization and 107,175 shares of restricted stock were forfeited pursuant to the terms of the Exchange Agreement, leaving us with 62,423,367 shares of common stock outstanding immediately following the Recapitalization.  Assuming no options are exercised prior to the expiration of the rights offering and assuming all 3,329,234 shares are sold in the rights offering, we expect 65,752,601 shares of our common stock will be outstanding immediately after completion of the rights offering.
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DESCRIPTION OF CAPITAL STOCK
The following description of the terms and conditions of our capital stock is qualified in its entirety by reference to our Amended and Restated Articles of Incorporation, our Amended and Restated Bylaws, and to Tennessee or federal law applicable to us.  For a more thorough understanding of the terms of our capital stock, you should refer to our Amended and Restated Articles of Incorporation and our Amended and Restated Bylaws, which are filed as exhibits to the registration statement of which this prospectus is a part.
The authorized capital stock of First Security presently consists of 150,000,000 shares of common stock and 10,000,000 shares of preferred stock.  As of July 3, 2013, 62,428,367 shares of our common stock were issued and outstanding, 127,196 shares of common stock were issuable upon exercise of outstanding stock options and approximately 149,000 shares of common stock were reserved for future issuance under our stock option plans, and no shares of preferred stock were issued and outstanding.  On June 18, 2013, the Company filed a definitive proxy statement requesting that our shareholders approve an amendment to the Company's Articles of Incorporation to permit the Board of Directors to effect a one-for-ten (1-for-10) reverse stock split.  Our annual shareholders meeting is July 24, 2013 and our shareholders will vote on the reverse stock split at that meeting.  The description of our capital stock set forth below is only a summary.  The full terms of our capital stock are set forth in Exhibits 3.1, 3.2, 4.1 and 4.2 to the registration statement of which this prospectus is a part and incorporated by reference herein.
Description of Common Stock
The following section describes the material features and rights of our common stock.  The summary does not purport to be exhaustive and is qualified in its entirety by reference to our Amended and Restated Articles of Incorporation and our Amended and Restated Bylaws, each of which is filed as an exhibit to the registration statement of which this prospectus is a part, and to applicable Tennessee law.
General.
The holders of our common stock have one vote per share on all matters submitted to a vote of our shareholders.  There are no cumulative voting rights for the election of directors.  Holders of common stock are entitled to receive ratably such dividends as may be declared by the Board of Directors out of legally available funds, subject to preferences that may be applicable to any outstanding series of preferred stock.  In the event of a liquidation, dissolution or winding up of First Security, the holders of common stock are entitled to share ratably in all assets remaining after payment of liabilities and the liquidation preference of any outstanding preferred stock. Holders of shares of our common stock have no preemptive, subscription, redemption, sinking fund or conversion rights.
Dividends.
The holders of our common stock are entitled to receive dividends declared by our Board of Directors out of funds legally available therefor. Our ability to pay dividends depends on the amount of dividends paid to us by our subsidiaries.  The payment of dividends is subject to government regulation, in that regulatory authorities may prohibit banks and bank holding companies from paying dividends in a manner that would constitute an unsafe or unsound banking practice.  In addition, a bank may not pay cash dividends if doing so would reduce the amount of its capital below that necessary to meet minimum regulatory capital requirements.  State laws also limit a bank's ability to pay dividends.  Accordingly, the dividend restrictions imposed on our subsidiaries by statute or regulation effectively may limit the amount of dividends we can pay.
Transfer Agent.
The transfer agent and registrar for our common stock is Registrar and Transfer Company.
Description of Preferred Stock
We are authorized to issue 10,000,000 shares of preferred stock, no par value per share.  The 10,000,000 authorized but unissued shares of preferred stock are typically referred to as "blank check" preferred stock.  This term refers to preferred stock for which the rights and restrictions are determined by the board of directors of a corporation.  We do not have any preferred stock outstanding, however under our Amended and Restated Articles of Incorporation, our Board of Directors has the authority, without any further shareholder vote or action, to issue the remaining preferred stock in one or more series and to fix, determine or amend the relative rights and preferences of any series so established, within the limitations set forth by the Tennessee Business Corporation Act, relating to the powers, designations, rights, preferences, and restrictions thereof, including but not limited to:
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•
the designation, stated value and liquidation preference of such preferred stock and the amount of stock offered;
•
the offering price;
•
the dividend rate or rates (or method of calculation), the date or dates from which dividends shall accrue, and whether such dividends shall be cumulative or noncumulative and, if cumulative, the dates from which dividends shall commence to cumulate;
•
any redemption or sinking fund provisions;
•
the amount that shares of such series shall be entitled to receive in the event of our liquidation, dissolution or winding-up;
•
the terms and conditions, if any, on which shares of such series shall be convertible or exchangeable for shares of our stock of any other class or classes, or other series of the same class;
•
the voting rights, if any, of shares of such series;
•
the status as to reissuance or sale of shares of such series redeemed, purchased or otherwise reacquired, or surrendered to us on conversion or exchange;
•
the conditions and restrictions, if any, on the payment of dividends or on the making of other distributions on, or the purchase, redemption or other acquisition by us or any subsidiary, of the common stock or of any other class of our shares ranking junior to the shares of such series as to dividends or upon liquidation;
•
the conditions and restrictions, if any, on the creation of indebtedness of us or of any subsidiary, or on the issuance of any additional stock ranking on a parity with or prior to the shares of such series as to dividends or upon liquidation; and
•
any additional dividend, liquidation, redemption, sinking or retirement fund and other rights, preferences, privileges, limitations and restrictions of such preferred stock.
The existence of blank-check preferred stock could have the effect of making it more difficult or time consuming for a third party to acquire a majority of our outstanding voting stock or otherwise effect a change of control.  Within the limits described above, the Board may issue preferred stock for capital raising transactions, acquisitions, joint ventures or other corporate purposes that have the effect of making an acquisition of the Company more difficult or costly, as could also be the case if the Board were to issue additional common stock for such purposes.  One series of preferred stock has been designated for possible issuance in the future.  See "Anti-takeover Effects of Certain Provisions in Our Articles, Bylaws and Tennessee Law -- Tax Benefits Preservation Plan and Designation of Series B Participating Preferred Stock."
Anti-takeover Effects of Certain Provisions of Our Articles, Bylaws and Tennessee Law
Consideration of Factors Other than Price.
A Tennessee corporation's charter may specifically authorize the members of its board of directors, in the exercise of their judgment, to give due consideration to factors other than price and to consider whether a merger, exchange, tender offer, or significant disposition of assets would adversely affect the corporation's employees, customers, suppliers, the communities in which the corporation operates, or any other relevant factor in the exercise of their fiduciary duty to the shareholders.  The Company's Amended and Restated Articles of Incorporation authorize our Board of Directors to take into consideration, in addition to price, the following factors in connection with a merger, tender offer, or other proposed business combination:
•
the business, financial condition, and earnings prospects of the acquiring person;
•
the competence, experience, and integrity of the acquiring person;
•
the prospects for a successful conclusion of the business combination;
•
our prospects as an independent entity; and
•
the social and economic impact of the proposed transaction on us and our employees, depositors, loan and other customers, creditors, and the communities in which we operate.
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The provisions of the Company's Amended and Restated Articles of Incorporation may have the effect of protecting us from unwanted takeover bids because the Board of Directors is permitted to take into account in good faith all relevant factors in performing its duly authorized duties.
Blank-Check Preferred Stock
.
As noted above, our Board of Directors, without shareholder approval, has the authority under our Amended and Restated Articles of Incorporation to issue preferred stock with rights superior to the rights of the holders of common stock.  As a result, preferred stock, while not intended as a defensive measure against takeovers, could be issued quickly and easily, could adversely affect the rights of holders of common stock and could make it more difficult or time consuming for a third party to acquire a majority of our outstanding voting stock or otherwise effect a change of control.  The Board may issue preferred stock for capital raising transactions, acquisitions, joint ventures or other corporate purposes that have the effect of making an acquisition of the Company more difficult or costly, as could also be the case if the Board were to issue additional common stock for such purposes.
Tax Benefits Preservation Plan and Designation of Series B Participating Preferred Stock
.  On October 24, 2012, the Board of Directors of the Company authorized the adoption by the Company of a Tax Benefits Preservation Plan (the "Plan") and declared a dividend of one preferred stock purchase right (each an "NOL Right" and collectively, the "NOL Rights") for each outstanding share of the common stock, payable to holders of record as of the close of business on November 12, 2012.  The Company adopted the Plan on October 30, 2012.  Each NOL Right entitles the registered holder to purchase from the Company one one-thousandth of one share of Series B Participating Preferred Stock, no par value, of the Company (the "Series B Preferred Stock"), at a purchase price equal to $20.00 per one one-thousandth of a share, subject to adjustment (the "NOL Purchase Price"). The description and terms of the NOL Rights are set forth in the Plan, dated October 30, 2012, as the same may be amended from time to time, between the Company and Registrar and Transfer Company, as Rights Agent.  The full terms of the Plan are set forth in Exhibit 4.2 to the registration statement of which this prospectus is a part and incorporated by reference herein.
Purpose of the Plan
The Company has previously experienced substantial net operating losses, which it may "carry forward" in certain circumstances to offset current and future taxable income and thus reduce its federal income tax liability, subject to certain requirements and restrictions.  The purpose of the Plan is to help preserve the value of the Company's deferred tax assets, such as its net operating losses ("Tax Benefits"), for U.S. federal income tax purposes.
These Tax Benefits can be valuable to the Company.  However, if the Company experiences an "ownership change," as defined in Section 382 ("Section 382") of the Internal Revenue Code of 1986, as amended, and the Treasury Regulations promulgated thereunder, its ability to use the Tax Benefits could be substantially limited and/or delayed, which would significantly impair the value of the Tax Benefits.  Generally, the Company would experience an "ownership change" under Section 382 if one or more "5 percent shareholders" increase their aggregate percentage ownership by more than 50 percentage points over the lowest percentage of stock owned by such shareholders over the preceding three-year period.  As a result, the Company has utilized a 5% "trigger" threshold in the Plan that is intended to act as a deterrent to any person or entity seeking to acquire 5% or more of the outstanding common stock without the prior approval of the Board.
Exercise
Prior to a Distribution Date (as defined below), the NOL Rights are not exercisable.  After a Distribution Date, each Right is exercisable to purchase, for the NOL Purchase Price, one one-thousandth of a share of Series B Preferred Stock.
Distribution Date means the earlier of:
•
the 10th business day after public announcement that any person or group has become an Acquiring Person (as defined below); and
36
•
the 10th business day after the date of the commencement of a tender or exchange offer by any person which would or could, if consummated, result in such person becoming an Acquiring Person, subject to extension by the Board.
Flip-In
If any person or group becomes a "5-percent shareholder" (an "Acquiring Person") (subject to certain exceptions described in the Plan), then on a Distribution Date, each NOL Right (other than NOL Rights beneficially owned by the Acquiring Person and certain affiliated persons) will entitle the holder to purchase, for the NOL Purchase Price, a number of shares of common stock of the Company equal to the quotient of (x) two times the NOL Purchase Price divided by (y) the then current market price of the Company's common stock; provided that (i) none of the Company and certain affiliates of the Company shall be an Acquiring Person, (ii) none of certain existing "5-percent shareholders" (including certain persons who are "5-percent shareholders" following specified exchange offers with the Company) shall be an Acquiring Person unless and until any such "5-percent shareholder" increases its percentage stock ownership in the Company by more than one-tenth of one percentage point, (iii) none of certain other "grandfathered persons" (as described in the Plan) shall be an Acquiring Person so long as any such "grandfathered person" satisfies the applicable requirements set forth in the Plan, (iv) no person or group who or which the Board determines, in its sole discretion, has inadvertently become a "5-percent shareholder" (or inadvertently failed to continue to qualify as a "grandfathered person") shall be an Acquiring Person so long as such Person promptly enters into, and delivers to the Company, an irrevocable commitment promptly to divest, and thereafter promptly divests (without exercising or retaining any power, including voting, with respect to such securities), sufficient securities of the Company so that such person's (or such group's) percentage stock ownership in the Company is less than 5 percent (or, in the case of any person or group that has inadvertently failed to qualify as a "grandfathered person," the securities of the Company that caused such person or group to fail to qualify as a "grandfathered person") , (v) no person or group that has become a "5-percent shareholder" shall be an Acquiring Person if the Board in good faith determines that such person's or group's attainment of "5-percent shareholder" status has not jeopardized or endangered the Company's utilization of the Tax Benefits or is otherwise in the best interests of the Company; provided that such a person or group shall be an "Acquiring Person" if the Board makes a contrary determination in good faith, and (vi) an acquisition by a person or group of at least a majority of the Company's common stock made by that person or group as part of a "qualified offer" (as defined in the Plan) shall not result in any person or group becoming an Acquiring Person.
Exchange
At any time after any person has become an Acquiring Person (but before any person becomes the beneficial owner of 50% or more of the Company's common stock), the Board may elect to exchange all or part of the NOL Rights (other than the NOL Rights beneficially owned by the Acquiring Person and certain affiliated persons) for one share of common stock (or, at the option of the Board, fractional shares of preferred stock with an aggregate current market price that equals the current market price of one share of common stock) per NOL Right, subject to adjustment.
Redemption
The Board may, at its option, redeem all, but not less than all, of the then outstanding NOL Rights at a redemption price of $0.00001 per Right at any time prior to a Distribution Date.
Expiration
The NOL Rights will expire on the earliest of (i) October 30, 2022, (ii) the time at which all NOL Rights are redeemed or exchanged, (iii) the first day of a taxable year of the Company as to which the Board determines that no Tax Benefits may be carried forward, (iv) a date on which the Board determines that a limitation on the use of the Tax Benefits under Section 382 would no longer be material to the Company, provided that such date is prior to public disclosure that a person became an Acquiring Person, (v) the repeal or amendment of Section 382 or any successor statute, if the Board determines that the Plan is no longer necessary for the preservation of Tax Benefits, (vi) the final adjournment of the Company's 2013 annual meeting of shareholders if the approval of the Plan by a majority of the shareholders voting at such meeting has not been received before such time, and (vii) the close of business on the date that is the final adjournment of the third annual meeting of shareholders following the last annual meeting of shareholders at which the Plan was most recently approved by a majority of shareholders voting
37
at such meeting, unless the Plan is re-approved by a majority of the shareholders at such third annual meeting of shareholders.
Amendments
At any time on or prior to a Distribution Date, the Company may, and the Rights Agent shall if the Company so directs, supplement or amend any provision of the Plan without the approval of any holders of NOL Rights.
After a Distribution Date, the Company may, and the Rights Agent shall if the Company so directs, supplement or amend the Plan without the approval of any holders of NOL Rights; provided, however, that no such supplement or amendment may (a) adversely affect the interests of the holders of NOL Rights as such (other than an Acquiring Person), (b) cause the Plan again to become amendable other than in accordance with this sentence or (c) cause the NOL Rights again to become redeemable.
Shareholder Rights
NOL Rights holders, in their capacity as such, have no rights as a shareholder of the Company, including the right to vote and to receive dividends.
Anti-dilution Provisions
The Plan includes anti-dilution provisions designed to prevent efforts to diminish the efficacy of the NOL Rights.
Business Combination Act.
Because the Company's common stock is registered with the SEC under the Securities Exchange Act of 1934, the Business Combination Act automatically applies to the Company unless the shareholders adopt a charter or bylaw amendment that expressly excludes the Company from the anti-takeover provisions of the Business Combination Act two years prior to a proposed takeover.  The Board of Directors has no present intention of recommending such charter or bylaw amendment.
The Business Combination Act imposes a five-year standstill on transactions such as mergers, share exchanges, sales of significant assets, liquidations, and other interested party transactions between Tennessee corporations and "interested shareholders" and their associates or affiliates, unless the business combination is approved by the Board of Directors before the interested shareholder acquires 10% or more of the beneficial ownership of any class of the corporation's voting securities.  Thereafter, the transaction either requires a two-thirds vote of the shareholders other than the interested shareholder or must satisfy certain fair price standards.
The Business Combination Act also provides exculpatory protection for the Board of Directors in refusing to waive the protections afforded under the Business Combination Act and/or Control Share Acquisition Act, or for resisting mergers, exchanges, tender offers, and similar transactions based on criteria other than price
Control Share Acquisition Act.
The Control Share Acquisition Act limits the voting rights of shares owned by a person above certain percentage thresholds (generally 20%) unless the non-interested shareholders of the corporation approve the acquisition of additional shares by the interested shareholder above the designated threshold.  However, the Control Share Acquisition Act applies only to corporations whose articles of incorporation or bylaws contain an express declaration that control share acquisitions are to be governed by the Control Share Acquisition Act.  In addition, the articles of incorporation or bylaws may specifically provide for the redemption of the control shares (shares in excess of the designated threshold) or appraisal rights for dissenting shareholders in a control share transaction.  Neither the Company's Amended and Restated Articles of Incorporation nor its Amended and Restated Bylaws currently contain a provision that subjects the Company to the provisions of the Control Share Acquisition Act, and the Board of Directors has no present intention of adopting any such bylaw amendment.  However, the Board of Directors could adopt such a bylaw amendment at any future time by majority vote based on facts and circumstances then present.
Greenmail Act.
The Greenmail Act applies to a Tennessee corporation that has a class of voting stock registered or traded on a national securities exchange or registered with the SEC pursuant to Section 12(g) of the Exchange Act.  Under the Greenmail Act, the Company may not purchase any of its shares at a price above the market value of such shares from any person who holds more than 3.0% of the class of securities to be purchased if
38
such person has held such shares for less than two years, unless the purchase has been approved by the affirmative vote of a majority of the outstanding shares of each class of voting stock issued by the Company or the Company makes an offer, of at least equal value per share, to all shareholders of such class.
Investor Protection Act.
The Investor Protection Act generally requires the registration, or an exemption from registration, before a person can make a tender offer for shares of a Tennessee corporation which, if successful, would result in the person beneficially owning more than 10% of any class.  Registration requires the filing with the Tennessee Commissioner of Commerce and Insurance of a registration statement, a copy of which must be sent to the target company, and the public disclosure of the material terms of the proposed offer.  The Investor Protection Act also prohibits fraudulent and deceptive practices in connection with takeover offers, and provides remedies for violations.
The Investor Protection Act does not apply to an offer involving a vote by holders of equity securities of the target company, pursuant to its articles of incorporation, on a merger, consolidation, or sale of corporate assets in consideration of the issuance of securities of another corporation, or on a sale of its securities in exchange for cash or securities of another corporation.  Also excluded from the Investor Protection Act are tender offers that are open on substantially equal terms to all shareholders, are recommended by the board of directors of the target company, and include full disclosure of all terms.
General Effects.
The provisions described above, to the extent applicable, will have the general effect of discouraging, or rendering more difficult, unfriendly takeover or acquisition attempts.  Consequently, such provisions would be beneficial to current management in an unfriendly takeover attempt but could have an adverse effect on shareholders who might wish to participate in such a transaction.  However, the Company believes that such provisions are advantageous to the shareholders in that these provisions will permit management and the shareholders to carefully consider and understand a proposed acquisition, lead to higher offering prices, and require a higher level of shareholder participation in the decision if the transaction is not approved by our Board of Directors.
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PLAN OF DISTRIBUTION
We are offering shares of our common stock directly to you pursuant to the rights offering.  Our officers and directors may contact holders of our common stock by mail, telephone, facsimile, and personal interview and may request brokers, custodian banks or other nominee holders on your behalf to forward materials relating to the offers to beneficial owners of our common stock.  These officers, directors, and other employees will not receive any commissions or compensation in connection with these activities other than their normal compensation.  We have retained Raymond James & Associates, Inc. to act as dealer manager in connection with the rights offering.  The dealer manager will use its reasonable efforts to advise and assist us in our efforts to solicit existing shareholders to exercise subscription rights in the rights offering, but will not underwrite the rights offering and has no obligation to purchase or procure purchases of the subscription rights or common stock offered hereby or otherwise act in any capacity whatsoever as an underwriter.
For acting as dealer manager, we have agreed to pay the dealer manager a fee equal to the greater of (i) 6.0% of the gross proceeds received from the rights offering and (ii) $200,000.  In addition, we have agreed to reimburse the dealer manager for its reasonable out-of-pocket expenses, up to
$100,000
.  Other than the dealer manager, we have not employed any brokers, dealers or underwriters to assist in the solicitation of the exercise of subscription rights in the rights offering and, except as just described, no other commissions, fees or discounts will be paid in connection with the rights offering.
Although Raymond James & Associates, Inc. has no obligation to act, and will not act, in any capacity as an underwriter in the rights offering, if it were nonetheless deemed to be an underwriter under the Securities Act, the fees and commissions to be paid to it might be deemed to be underwriting fees and commissions.  We have agreed to indemnify Raymond James & Associates, Inc. against certain liabilities and expenses in connection with its engagement, including certain potential liabilities under the federal securities laws.  We will also pay the fees and expenses of Registrar and Transfer Company, as subscription agent, and we have agreed to indemnify the subscription agent from certain liabilities in connection with the rights offering.  We will pay out-of-pocket expenses, including payments to legal advisors, accountants, the dealer manager, subscription agent, printing costs, mailing costs, and filing fees estimated to total approximately $
.
The dealer manager has not prepared any report or opinion constituting a recommendation or advice to us or to our shareholders, nor has the dealer manager prepared an opinion as to the fairness of the subscription price or the terms of the rights offering.  The dealer manager expresses no opinion and makes no recommendation to our shareholders as to the purchase by any person of any shares of our common stock.  The dealer manager expresses no opinion as to the prices that the shares of common stock may trade for if and when they are issued or at any future time.
In the ordinary course of its business, Raymond James & Associates, Inc. and/or its affiliates have in the past performed investment banking and other services for us for which they have received customary compensation.  In the ordinary course of its business, Raymond James & Associates, Inc. and/or its affiliates may in the future perform investment banking or other services for us for which it will receive customary compensation.
As soon as practicable, we will distribute subscription rights certificates to shareholders who owned shares of our common stock at 5:00 p.m., Eastern Time, on April 10, 2013.  If you wish to exercise your subscription rights and purchase shares of our common stock, you should complete the subscription rights certificate and return it with payment for the shares to the subscription agent, Registrar and Transfer Company, at:
By Mail:
Registrar and Transfer Company
___________
___________
By Hand or By Overnight Courier:
Registrar and Transfer Company
___________
___________
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See "The Rights Offering — Method of Exercising Subscription Rights."  If you have any questions, you should contact the subscription agent, Registrar and Transfer Company,  at
___________.
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MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES
The following summary describes the material U.S. federal income tax consequences of the receipt, exercise and expiration of the subscription rights acquired through the rights offering and owning and disposing of the shares of common stock received upon exercise of the subscription rights.  Insofar as the summary relates to matters of U.S. federal income tax law and regulations or legal conclusions with respect thereto, the summary constitutes the opinion of our tax counsel, Bryan Cave LLP.
This summary is based upon the Internal Revenue Code of 1986, as amended (the "Code"), Treasury regulations promulgated thereunder and administrative and judicial interpretations thereof, all as currently in effect and all of which are subject to differing interpretations or to change, possibly with retroactive effect.  No assurance can be given that the Internal Revenue Service ("IRS") would not assert, or that a court would not sustain, a position contrary to any of the tax consequences described below.
This summary is for general information only and does not purport to discuss all aspects of U.S. federal income taxation that may be important to a particular holder in light of the holder's particular circumstances or to holders that may be subject to special tax rules, including, but not limited to, partnerships or other pass-through entities, banks and other financial institutions, tax-exempt entities, employee stock ownership plans, certain former citizens or residents of the United States, insurance companies, regulated investment companies, real estate investment trusts, dealers in securities or currencies, brokers, traders in securities that have elected to use the mark-to-market method of accounting, persons holding subscription rights or shares of common stock as part of an integrated transaction, including a "straddle," "hedge," "constructive sale" or "conversion transaction," persons whose functional currency for tax purposes is not the U.S. dollar, and persons subject to the alternative minimum tax provisions of the Code.
This summary applies to you only if you are a U.S. holder (as defined below) and receive your subscription rights in the rights offering, and you hold your subscription rights or shares of common stock issued to you upon exercise of the subscription rights as capital assets for tax purposes. This summary does not apply to you if you are not a U.S. holder.
We have not sought, and will not seek, a ruling from the IRS regarding the federal income tax consequences of the rights offering or the related share issuances. The following summary does not address the tax consequences of the rights offering or the related share issuance under foreign, state, or local tax laws.
You are a U.S. holder if you are a beneficial owner of subscription rights or common stock and you are:
•
An individual who is a citizen or resident of the United States for U.S. federal income tax purposes;
•
A corporation (or other business entity treated as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of Columbia;
•
An estate the income of which is subject to U.S. federal income tax regardless of its source; or
•
A trust (a) if a court within the United States can exercise primary supervision over its administration and one or more U.S. persons are authorized to control all substantial decisions of the trust or (b) that has a valid election in effect under applicable Treasury Regulations to be treated as a U.S. person.
If a partnership (including any entity treated as a partnership for U.S. federal income tax purposes) receives the subscription rights or holds the common stock received upon exercise of the subscription rights, the tax treatment of a partner in such partnership generally will depend upon the status of the partner and the activities of the partnership. Such a partner or partnership is urged to consult its own tax advisor as to the U.S. federal income tax consequences of receiving and exercising the subscription rights and acquiring, holding or disposing of our common shares.
Each recipient of rights in the rights offering should consult the recipient's own tax advisor with respect to the tax consequences of the rights offering and the related share issuances that may result from such recipient's particular circumstances.
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Taxation of Subscription Rights
Receipt of Subscription Rights
Your receipt of subscription rights pursuant to the rights offering will not be treated as a taxable distribution with respect to your existing shares of common stock for U.S. federal income tax purposes.  Under Section 305 of the Code, a shareholder who receives a right to acquire shares will, in certain circumstances, be treated as having received a taxable dividend in an amount equal to the value of such right.  A common shareholder who receives a right to acquire shares of common stock generally will be treated as having received a taxable dividend if such shareholder's proportionate interest in the earnings and profits or assets of the corporation is increased and any other shareholder receives a distribution of cash or other property.  A common shareholder who receives a right to acquire shares of common stock will be treated as having received a taxable dividend if the distribution is treated as part of a "disproportionate distribution."  A disproportionate distribution of stock or stock rights occurs when a distribution (or series of distributions) from a corporation results in (a) an increase in the shareholder's proportionate interest in the earnings and profits or assets of the corporation and (b) the receipt by other shareholders of cash or other property.  For purposes of the above, "shareholder" includes holders of warrants, options and convertible securities.  We do not believe, however, that a disproportionate distribution will occur and, therefore, the receipt of subscription rights will not be taxable to a shareholder.
Tax Basis in the Subscription Rights
If the fair market value of the subscription rights you receive is less than 15% of the fair market value of your existing shares of common stock on the date you receive the subscription rights, the subscription rights will be allocated a zero basis for U.S. federal income tax purposes, unless you elect to allocate your basis in your existing shares of common stock between your existing shares of common stock and the subscription rights in proportion to the relative fair market values of the existing shares of common stock and the subscription rights determined on the date of receipt of the subscription rights. If you choose to allocate basis between your existing shares of common stock and the subscription rights, you must make this election on a statement included with your tax return for the taxable year in which you receive the subscription rights.  Such an election is irrevocable.
However, if the fair market value of the subscription rights you receive is 15% or more of the fair market value of your existing shares of common stock on the date you receive the subscription rights, then you must allocate your basis in your existing shares of common stock between your existing shares of common stock and the subscription rights you receive in proportion to their fair market values determined on the date you receive the subscription rights.  The fair market value of the subscription rights on the date the subscription rights will be distributed is uncertain. In determining the fair market value of the subscription rights, you should consider all relevant facts and circumstances, including the trading price thereof.
Exercise of Subscription Rights
You will not recognize gain or loss on the exercise of a subscription right.  Your tax basis in a new share of common stock acquired when you exercise a subscription right will be equal to your adjusted tax basis in the subscription right, if any, plus the subscription price.  The holding period of a share of common stock acquired when you exercise your subscription rights will begin on the date of exercise.
Expiration of Subscription Rights
If you allow subscription rights received in the rights offering to expire, you will not recognize any gain or loss for U.S. federal income tax purposes, and you will re-allocate any portion of the tax basis in your existing shares of common stock previously allocated to the subscription rights that have expired to the existing shares of common stock.
Taxation of Shares of Common Stock Acquired upon Exercise of Subscription Rights
Distributions
Distributions with respect to shares of common stock acquired upon exercise of subscription rights will be taxable as dividend income when actually or constructively received to the extent of our current or accumulated earnings and profits as determined for U.S. federal income tax purposes.  To the extent that the amount of a distribution exceeds our current and accumulated earnings and profits, such distribution will be treated first as a tax-free return of capital to the extent of your adjusted tax basis in such shares of common stock and thereafter as capital gain.
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Dispositions
If you sell or otherwise dispose of the shares of common stock acquired upon exercise of the subscription rights, you will generally recognize capital gain or loss equal to the difference between the amount realized and your adjusted tax basis in the shares of common stock.  Such capital gain or loss will be long-term capital gain or loss if your holding period for the shares of common stock is more than one year. Long-term capital gain of an individual is generally taxed at favorable rates.  The deductibility of capital losses is subject to limitations.
Recent Legislation Relating to Foreign Accounts
Recently enacted legislation may impose withholding taxes on certain types of payments made to "foreign financial institutions" and certain other non-U.S. entities.  The legislation imposes a 30% withholding tax on dividends paid after December 31, 2013 on, or gross proceeds paid after December 31, 2014 from the sale or other disposition of, our common stock paid to a foreign financial institution unless the foreign financial institution enters into an agreement with the U.S. Treasury to among other things, undertake to identify accounts held by certain U.S. persons or U.S.-owned foreign entities, annually report certain information about such accounts and withhold 30% on payments to account holders whose actions prevent it from complying with these reporting and other requirements.  In addition, the legislation imposes a 30% withholding tax on the same types of payments to a foreign non-financial entity unless the entity certifies that it does not have any substantial U.S. owners or furnishes identifying information regarding each substantial U.S. owner. Holders should consult their tax advisors regarding this legislation.
Health Care and Education Reconciliation Act of 2010
On March 30, 2010, President Obama signed into law the Health Care and Reconciliation Act of 2010, which requires certain U.S. shareholders who are individuals, estates or trusts to pay a 3.8% tax on, among other things, dividends on and capital gains from the sale or other disposition of stock for taxable years beginning after December 31, 2012.  Holders should consult their tax advisors regarding the effect, if any, of this legislation on their ownership and disposition of our common stock.
Information Reporting and Backup Withholding
Payments made to you of proceeds from the sale of the shares of common stock acquired upon exercise of the subscription rights may be subject to information reporting and/or backup withholding with respect to dividend payments on or the gross proceeds from the disposition of our common stock acquired through the exercise of subscription rights.  Backup withholding may apply under certain circumstances if you (1) fail to furnish your social security or other taxpayer identification number ("TIN"), (2) furnish an incorrect TIN, (3) fail to report interest or dividends properly, or (4) fail to provide a certified statement, signed under penalty of perjury, that the TIN provided is correct, that you are not subject to backup withholding and that you are a U.S. person. Any amount withheld from a payment under the backup withholding rules is allowable as a credit against (and may entitle you to a refund with respect to) your U.S. federal income tax liability, provided that the required information is furnished to the IRS. Certain persons are exempt from backup withholding, including corporations and financial institutions.  You are urged to consult your own tax advisor as to your qualification for exemption from backup withholding and the procedure for obtaining such exemption.
LEGAL MATTERS
Certain legal matters with respect to this rights offering will be passed upon for us by Bryan Cave LLP, Atlanta, Georgia.  Certain legal matters with respect to this rights offering will be passed upon for the dealer manager by Alston & Bird LLP, Atlanta, Georgia.
EXPERTS
Our consolidated financial statements as incorporated in this prospectus by reference to the Annual Report on Form 10-K for the years ended December 31, 2012 and 2011 and for each of the years in the two-year period ended December 31, 2012 have been so incorporated in reliance on the report of Crowe Horwath LLP, independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.
44
Our consolidated financial statements for the year ended December 31, 2010 have been incorporated by reference in this prospectus in reliance upon the report of Joseph Decosimo and Company, PLLC, an independent registered public accounting firm, incorporated by reference herein and therein, and upon the authority of said firm as experts in accounting and auditing.
45
Up to 3,329,234 Shares
Common Stock
PROSPECTUS
_________________, 2013
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 13.    Expenses of Issuance and Distribution.
The following table sets forth the costs and expenses, other than dealer manager fees, payable by us in connection with the sale of the common stock being registered.  All amounts are estimated except the SEC registration fee, the FINRA filing fee and the NASDAQ Capital Market listing of additional shares fee.
SEC registration fee
$ 681
FINRA filing fee
*
NASDAQ Capital Market listing fee
*
Printing, postage and mailing
*
Legal fees and expenses
*
Accounting fees and expenses
*
Blue Sky fees and expenses
*
Transfer agent and registrar fees and expenses
*
Miscellaneous fees and expenses
*
TOTAL
$225,000
____________________
*    To be supplied by Amendment.
Item 14.    Indemnification of Directors and Officers.
The Tennessee Business Corporation Act provides that a corporation may indemnify any of its directors and officers against liability incurred in connection with a proceeding if (i) the director or officer acted in good faith, (ii) in the case of conduct in his or her official capacity with the corporation, the director or officer reasonably believed such conduct was in the corporation's best interest, (iii) in all other cases, the director or officer reasonably believed that his or her conduct was not opposed to the best interest of the corporation, and (iv) in connection with any criminal proceeding, the director or officer had no reasonable cause to believe that his or her conduct was unlawful. In actions brought by or in the right of the corporation, however, the Tennessee Business Corporation Act provides that no indemnification may be made if the director or officer was adjudged to be liable to the corporation.  In cases where the director or officer is wholly successful, on the merits or otherwise, in the defense of any proceeding instigated because of his or her status as an officer or director of a corporation, the Tennessee Business Corporation Act mandates that the corporation indemnify the director or officer against reasonable expenses incurred in the proceeding.  The Tennessee Business Corporation Act also provides that in connection with any proceeding charging improper personal benefit to an officer or director, no indemnification may be made if such officer or director is adjudged liable on the basis that personal benefit was improperly received. Notwithstanding the foregoing, the Tennessee Business Corporation Act provides that a court of competent jurisdiction, upon application, may order that an officer or director be indemnified for reasonable expenses if, in consideration of all relevant circumstances, the court determines that such individual is fairly and reasonably entitled to indemnification, notwithstanding the fact that (i) such officer or director was adjudged liable to the corporation in a proceeding by or in right of the corporation, (ii) such officer or director was adjudged liable on the basis that personal benefit was improperly received by him; or (iii) such officer or director breached his duty of care to the corporation.
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1
The Bylaws provide that no director shall be personally liable to First Security or its shareholders for monetary damages for breach of any fiduciary duty as a director except for liability for (i) any breach of the director's duty of loyalty, (ii) acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) for the types of liability set forth in Section 48-18-304 of the Tennessee Business Corporation Act, which provides that directors who vote for unlawful distributions of corporate funds will be held personally liable to the corporation for the amount of any such distribution, or (iv) for any act or omission occurring before the effective date of the Articles of Incorporation.
Item 15.     Recent Sales of Unregistered Securities.
On February 25, 2013, the Company entered into an Exchange Agreement with Treasury, which held 33,000 shares of the Company's TARP Preferred Stock and the TARP Warrant to purchase 82,363 shares of the Company's common stock.  The Exchange Agreement required Treasury to exchange the TARP Preferred Stock and the TARP Warrant for the Converted Shares, which represented the number of shares of common stock that, based on a price per share equal to the Purchase Price, represented a discount of 73.25% of the aggregate liquidation amount of the TARP Preferred Stock plus 100% of the accrued but unpaid dividends thereon through the TARP Closing Date.  Accordingly, on April 11, 2013, the Company issued 9,941,908 shares of common stock to Treasury.  Immediately following the issuance of the Converted Shares to Treasury, Treasury sold the Converted Shares to certain investors identified by the Company at the Purchase Price pursuant to TARP Securities Purchase Agreements between such investors, Treasury and the Company.
On February 25, 2013, the Company entered into Stock Purchase Agreements with certain institutional investors, including affiliates of EJF, GF Financial, MFP, Ulysses and the other investors named therein (collectively, the "Investors"), whereby EJF, GF Financial, MFP and Ulysses each agreed to purchase approximately $9.0 million of common stock at the Purchase Price.  In aggregate, the Company executed a Stock Purchase Agreement with Investors to purchase approximately $91.1 million of common stock.  The Stock Purchase Agreement provides that the Company could direct each Investor to purchase all or part of such Investor's committed investment from Treasury.  Investors purchased shares remaining from their committed investment directly from the Company.
The Local Investors executed Subscription Agreements, pursuant to which they committed to purchase shares of common stock for the Purchase Price.  The Subscription Agreements provided that the Company could direct each Local Investor to purchase all or a portion of such Local Investor's committed investment from Treasury.
In aggregate, the Investors and Local Investors agreed to purchase approximately $91.1 million of common stock at $1.50 per share.  Accordingly, Investors and Local Investors purchased 9,941,908 shares from Treasury on April 11, 2013, and, on April 12, 2013, the Company sold 50,793,092 shares of common stock to the Investors and the Local Investors.
Pursuant to the Stock Purchase Agreement, 60,735,000 shares of our common stock sold in the Recapitalization have been registered for resale on a registration statement on Form S-1 (File No. 333-188137) that was declared effective by the SEC on June 6, 2013.  The investors in our Recapitalization are no longer subject to any lock-up agreements or any other contractual agreements not to dispose of our shares and these shares are freely transferable.
The issuance of securities pursuant to the transactions described above were private placements to "accredited investors" (as that term is defined under Rule 501 of Regulation D), and were therefore exempt from registration under the Securities Act, in reliance upon Section 4(a)(2) of the Securities Act and Regulation D Rule 506, as a transaction by an issuer not involving a public offering.
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Item 16.    Exhibits
Exhibit
Number
Definition
3.1
Amended and Restated Articles of Incorporation.
(1)
3.2
Amended and Restated Bylaws.
(1)
4.1
Form of Common Stock Certificate.
(2)
4.2
Tax Benefit Preservation Plan, dated October 30, 2012.
(3)
4.3**
Form of Rights Certificate.
5.1**
Form of opinion of Bryan Cave LLP.
10.1*
First Security's Second Amended and Restated 1999 Long-Term Incentive Plan.
(2)
10.2*
First Security's Amended and Restated 2002 Long-Term Incentive Plan.
(4)
10.3*
Form of Incentive Stock Option Award under the Second Amended and Restated 1999 Long-Term Incentive Plan.
(5)
10.4*
Form of Incentive Stock Option Award under the 2002 Long-Term Incentive Plan.
(5)
10.5*
Form of Non-qualified Stock Option Award under the 2002 Long-Term Incentive Plan.
(5)
10.6*
Form of Restricted Stock Award under the 2002 Long-Term Incentive Plan.
(5)
10.7*
Form of Restricted Stock Award under the 2002 Long-Term Incentive Plan with TARP restrictions.
(6)
10.8*
Employment Agreement Dated as of May 16, 2003 by and between First Security and Rodger B. Holley.
(7)
10.9*
Salary Continuation Agreement Dated as of December 21, 2005 by and between First Security, FSGBank and Rodger B. Holley.
(8)
10.10*
Employment Agreement Dated as of September 20, 2010 and Executed November 24, 2010 by and between First Security and Ralph E. "Gene" Coffman, Jr.
(9)
10.11*
Employment Agreement Dated as of May 16, 2003 by and between First Security and William L. Lusk, Jr.
(7)
10.12*
Salary Continuation Agreement Dated as of December 21, 2005 by and between First Security, FSGBank and William L. Lusk, Jr.
(8)
10.13*
First Security Group, Inc. Non-Employee Director Compensation Policy.
(8)
10.14*
Form of First Amendment to Employment Agreements, Dated as of December 18, 2008 (executed by Messrs. Holley and Lusk).
(8)
10.15*
Form of Senior Executive Officer Agreement, Dated as of January 9, 2009 (executed by Messrs. Holley and Lusk).
(11)
10.16
Letter Agreement, Dated January 9, 2009, including Securities Purchase Agreement—Standard Terms, incorporated by reference therein, between the Company and the United States Department of the Treasury.
(11)
10.17*
Form of TARP Restricted Employee Agreement, Dated as of December 10, 2009 (executed by Messrs. Holley and Lusk).
(12)
10.18
Consent Order, Dated April 28, 2010, between FSGBank and the Office of the Comptroller of the Currency.
(13)
10.19
Stipulation and Consent to the Issuance of a Consent Order, Dated April 28, 2010, between FSGBank and the Office of the Comptroller of the Currency.
(13)
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10.20
Written Agreement, Dated September 7, 2010, between First Security Group, Inc. and the Federal Reserve Bank of Atlanta.
(14)
10.21
Resignation Letter of Rodger B. Holley, dated April 21, 2011.
(15)
10.22
Severance Agreement by and between Rodger B. Holley, First Security Group, Inc. and FSGBank, N.A., dated April 21, 2011.
(15)
10.23
Engagement Agreement with First Security Group, Inc., FSGBank, N.A. and Triumph Investment Management, LLC, dated April 28, 2011.
(16)
10.24
Amendment to Engagement Agreement with First Security Group, Inc., FSGBank, N.A. and Triumph Investment Management, LLC, dated March 28, 2012.
(17)
10.25
Employment Agreement by and between D. Michael Kramer, First Security Group, Inc. and FSGBank, N.A., dated December 28, 2011.
(18)
10.26
Exchange Agreement by and between First Security Group, Inc. and The United States Department of The Treasury, dated February 25, 2013.
(19)
10.27
Stock Purchase Agreement by and between First Security Group, Inc. and certain Named Investors, dated February 25, 2013.
(19)
10.28
Form of Securities Purchase Agreement by and between The United States Department of The Treasury and First Security Group, Inc., dated February 25, 2013.
(19)
10.29*
First Security Group, Inc., 2012 Long-Term Incentive Plan.
(20)
10.30*
Form of Incentive Stock Option Award under the 2012 Long-Term Incentive Plan.
(21)
10.31*
Form of Non-qualified Stock Option Award under the 2012 Long-Term Incentive Plan.
(21)
10.32*
Form of Restricted Stock Award for a Director under the 2012 Long-Term Incentive Plan with TARP restrictions.
(21)
10.33*
Form of Restricted Stock Award for an Employee under the 2012 Long-Term Incentive Plan with TARP restrictions.
(21)
10.34**
Form of Dealer Manager Agreement.
21.1
Subsidiaries of the Registrant.
(1)
23.1
Consent of Crowe Horwath LLP.
23.2
Consent of Joseph Decosimo and Company, PLLC.
23.3**
Consent of Bryan Cave LLP (see Exhibit 5.1 to this Registration Statement)
24
Power of Attorney (contained on the Signature Page).
99.1**    Form of Instruction as to Use of Rights Certificates.
99.2**    Form of Letter to Shareholders who are Record Holders.
99.3**    Form of Letter to Shareholders who are Dealers/Nominees.
99.4**    Form of Letter to Clients who are Beneficial Holders.
99.5**    Form of Nominee Holder Certification.
99.6**    Form of Beneficial Owner Election Form.
99.7**
Form of Separate Instruction Letter for Participants in the First Security Group, Inc. 401(k) and Employee Stock Ownership Plan.
101
Interactive Data Files providing financial information from the Registrant's Annual Report on Form 10-K for the year ended December 31, 2012 in XBRL (eXtensible Business Reporting Language).  Pursuant to Regulation 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Section 11 or 12 of the Securities Act of 1933,
II-4
as amended, or Section 18 of the Securities Exchange Act of 1934, as amended, and are otherwise not subject to liability.
(21)
*
The indicated exhibit is a compensatory plan.
**
To be filed by amendment.
1
Incorporated by reference to First Security's Registration Statement on Form S-1 dated April 25, 2013, File No. 333-188137.
2
Incorporated by reference to First Security's Registration Statement on Form S-1 dated April 20, 2001, File No. 333-59338.
3
Incorporated by reference to First Security's Current Report on Form 8-K filed October 30, 2012.
4
Incorporated by reference from Appendix A to First Security's Proxy Statement filed April 30, 2007.
5
Incorporated by reference to First Security's Annual Report on Form 10-K for the year ended December 31, 2004.
6
Incorporated by reference to First Security's Annual Report on Form 10-K for the year ended December 31, 2010.
7
Incorporated by reference to First Security's Quarterly Report on Form 10-Q for the period ended June 30, 2003.
8
Incorporated by reference to First Security's Annual Report on Form 10-K for the year ended December 31, 2005.
9
Incorporated by reference to First Security's Current Report on Form 8-K filed December 1, 2010.
10
Incorporated by reference to First Security's Annual Report on Form 10-K for the year ended December 31, 2008.
11
Incorporated by reference to First Security's Current Report on Form 8-K filed January 9, 2009.
12
Incorporated by reference to First Security's Annual Report on Form 10-K for the year ended December 31, 2009.
13
Incorporated by reference to First Security's Current Report on Form 8-K filed April 29, 2010.
14
Incorporated by reference to First Security's Current Report on Form 8-K filed September 14, 2010.
15
Incorporated by reference to First Security's Current Report on Form 8-K filed April 27, 2011.
16
Incorporated by reference to First Security's Current Report on Form 8-K filed April 29, 2011.
17
Incorporated by reference to First Security's Annual Report on Form 10-K for the year ended December 31, 2011.
18
Incorporated by reference to First Security's Current Report on Form 8-K filed December 29, 2011.
19
Incorporated by reference to First Security's Current Report on Form 8-K filed February 26, 2013.
20
Incorporated by reference from Appendix A to First Security's Proxy Statement filed May 1, 2012.
21
Incorporated by reference to First Security's Annual Report on Form 10-K for the year ended December 31, 2012.
Item 17.    Undertakings.
The undersigned registrant hereby undertakes:
(a)
To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
(i)
to include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;
(ii)
to reflect in the prospectus any facts or events arising after the effective date of this registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in
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the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; and
(iii)
to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.
(b)
That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(c)
To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
(d)
That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser:
(i)
each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and
(ii)
each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information required by section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof; provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date.
(e)
That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities, the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
(i)
Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
(ii)
Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
(iii)
The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and
(iv)
Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
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(f)
Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other that the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit of proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act of 1933 and will be governed by the final adjudication of such issue.
(g)
The undersigned registrant hereby undertakes that:
(i)
For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b) (1) or (4) or 497(h) under the Securities Act of 1933 shall be deemed to be part of this registration statement as of the time it was declared effective.
(ii)
For the purpose of determining any liability under the Securities Act of 1933 each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Chattanooga, State of Tennessee, on July 3, 2013.
FIRST SECURITY GROUP, INC.
By:
/s/ D. Michael Kramer
D. Michael Kramer
President and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each of the persons whose signature appears below appoints and constitutes D. Michael Kramer and John R. Haddock and each of them, his or her true and lawful attorney-in-fact and agent, each acting alone, with full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to execute any and all amendments (including post-effective amendments) to the within registration statement (as well as any registration statement for the same offering covered by this registration statement that is to be effective upon filing pursuant to Rule 462(b) under the Securities Act of 1933), and to file the same, together with all exhibits thereto and all other documents in connection therewith, with the Securities and Exchange Commission and such other agencies, offices and persons as may be required by applicable law, granting unto each said attorney-in-fact and agent, each acting alone, full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that each said attorney-in-fact and agent, each acting alone may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities on July 3, 2013.
Name                            Title
/s/ D. Michael Kramer
President and Chief Executive Officer and Director
D. Michael Kramer
(Principal Executive Officer)
/s/ John R. Haddock
Executive Vice President and Chief Financial Officer
John R. Haddock
(Principal Financial and Accounting Officer)
/s/ Larry D. Mauldin
Chairman of the Board and Director
Larry D. Mauldin
/s/ Henchy R. Enden
Director
Henchy R. Enden
/s/ William F. Grant, III
Director
William F. Grant, III
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8
/s/ William C. Hall
Director
William C. Hall
/s/ Adam G. Hurwich
Director
Adam G. Hurwich
/s/ Carol H. Jackson
Director
Carol H. Jackson
/s/ Kelly P. Kirkland
Director
Kelly P. Kirkland
/s/ Robert R. Lane
Director
Robert R. Lane
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EXHIBIT INDEX
Exhibit
Number
Definition
3.1
Amended and Restated Articles of Incorporation.
(1)
3.2
Amended and Restated Bylaws.
(1)
4.1
Form of Common Stock Certificate.
(2)
4.2
Tax Benefit Preservation Plan, dated October 30, 2012.
(3)
4.3**
Form of Rights Certificate.
5.1**
Form of opinion of Bryan Cave LLP.
10.1*
First Security's Second Amended and Restated 1999 Long-Term Incentive Plan.
(2)
10.2*
First Security's Amended and Restated 2002 Long-Term Incentive Plan.
(4)
10.3*
Form of Incentive Stock Option Award under the Second Amended and Restated 1999 Long-Term Incentive Plan.
(5)
10.4*
Form of Incentive Stock Option Award under the 2002 Long-Term Incentive Plan.
(5)
10.5*
Form of Non-qualified Stock Option Award under the 2002 Long-Term Incentive Plan.
(5)
10.6*
Form of Restricted Stock Award under the 2002 Long-Term Incentive Plan.
(5)
10.7*
Form of Restricted Stock Award under the 2002 Long-Term Incentive Plan with TARP restrictions.
(6)
10.8*
Employment Agreement Dated as of May 16, 2003 by and between First Security and Rodger B. Holley.
(7)
10.9*
Salary Continuation Agreement Dated as of December 21, 2005 by and between First Security, FSGBank and Rodger B. Holley.
(8)
10.10*
Employment Agreement Dated as of September 20, 2010 and Executed November 24, 2010 by and between First Security and Ralph E. "Gene" Coffman, Jr.
(9)
10.11*
Employment Agreement Dated as of May 16, 2003 by and between First Security and William L. Lusk, Jr.
(7)
10.12*
Salary Continuation Agreement Dated as of December 21, 2005 by and between First Security, FSGBank and William L. Lusk, Jr.
(8)
10.13*
First Security Group, Inc. Non-Employee Director Compensation Policy.
(8)
10.14*
Form of First Amendment to Employment Agreements, Dated as of December 18, 2008 (executed by Messrs. Holley and Lusk).
(8)
10.15*
Form of Senior Executive Officer Agreement, Dated as of January 9, 2009 (executed by Messrs. Holley and Lusk).
(11)
10.16
Letter Agreement, Dated January 9, 2009, including Securities Purchase Agreement—Standard Terms, incorporated by reference therein, between the Company and the United States Department of the Treasury.
(11)
10.17*
Form of TARP Restricted Employee Agreement, Dated as of December 10, 2009 (executed by Messrs. Holley and Lusk).
(12)
10.18
Consent Order, Dated April 28, 2010, between FSGBank and the Office of the Comptroller of the Currency.
(13)
10.19
Stipulation and Consent to the Issuance of a Consent Order, Dated April 28, 2010, between FSGBank and the Office of the Comptroller of the Currency.
(13)
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10
10.20
Written Agreement, Dated September 7, 2010, between First Security Group, Inc. and the Federal Reserve Bank of Atlanta.
(14)
10.21
Resignation Letter of Rodger B. Holley, dated April 21, 2011.
(15)
10.22
Severance Agreement by and between Rodger B. Holley, First Security Group, Inc. and FSGBank, N.A., dated April 21, 2011.
(15)
10.23
Engagement Agreement with First Security Group, Inc., FSGBank, N.A. and Triumph Investment Management, LLC, dated April 28, 2011.
(16)
10.24
Amendment to Engagement Agreement with First Security Group, Inc., FSGBank, N.A. and Triumph Investment Management, LLC, dated March 28, 2012.
(17)
10.25
Employment Agreement by and between D. Michael Kramer, First Security Group, Inc. and FSGBank, N.A., dated December 28, 2011.
(18)
10.26
Exchange Agreement by and between First Security Group, Inc. and The United States Department of The Treasury, dated February 25, 2013.
(19)
10.27
Stock Purchase Agreement by and between First Security Group, Inc. and certain Named Investors, dated February 25, 2013.
(19)
10.28
Form of Securities Purchase Agreement by and between The United States Department of The Treasury and First Security Group, Inc., dated February 25, 2013.
(19)
10.29*
First Security Group, Inc., 2012 Long-Term Incentive Plan.
(20)
10.30*
Form of Incentive Stock Option Award under the 2012 Long-Term Incentive Plan.
(21)
10.31*
Form of Non-qualified Stock Option Award under the 2012 Long-Term Incentive Plan.
(21)
10.32*
Form of Restricted Stock Award for a Director under the 2012 Long-Term Incentive Plan with TARP restrictions.
(21)
10.33*
Form of Restricted Stock Award for an Employee under the 2012 Long-Term Incentive Plan with TARP restrictions.
(21)
10.34**
Form of Dealer Manager Agreement.
21.1
Subsidiaries of the Registrant.
(1)
23.1
Consent of Crowe Horwath LLP.
23.2
Consent of Joseph Decosimo and Company, PLLC.
23.3**
Consent of Bryan Cave LLP (see Exhibit 5.1 to this Registration Statement)
24
Power of Attorney (contained on the Signature Page).
99.1**    Form of Instruction as to Use of Rights Certificates.
99.2**    Form of Letter to Shareholders who are Record Holders.
99.3**    Form of Letter to Shareholders who are Dealers/Nominees.
99.4**    Form of Letter to Clients who are Beneficial Holders.
99.5**    Form of Nominee Holder Certification.
99.6**    Form of Beneficial Owner Election Form.
99.7**
Form of Separate Instruction Letter for Participants in the First Security Group, Inc. 401(k) and Employee Stock Ownership Plan.
101
Interactive Data Files providing financial information from the Registrant's Annual Report on Form 10-K for the year ended December 31, 2012 in XBRL (eXtensible Business Reporting Language).  Pursuant to Regulation 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Section 11 or 12 of the Securities Act of 1933,
II-11
as amended, or Section 18 of the Securities Exchange Act of 1934, as amended, and are otherwise not subject to liability.
(21)
*
The indicated exhibit is a compensatory plan.
**
To be filed by amendment.
1
Incorporated by reference to First Security's Registration Statement on Form S-1 dated April 25, 2013, File No. 333-188137.
2
Incorporated by reference to First Security's Registration Statement on Form S-1 dated April 20, 2001, File No. 333-59338.
3
Incorporated by reference to First Security's Current Report on Form 8-K filed October 30, 2012.
4
Incorporated by reference from Appendix A to First Security's Proxy Statement filed April 30, 2007.
5
Incorporated by reference to First Security's Annual Report on Form 10-K for the year ended December 31, 2004.
6
Incorporated by reference to First Security's Annual Report on Form 10-K for the year ended December 31, 2010.
7
Incorporated by reference to First Security's Quarterly Report on Form 10-Q for the period ended June 30, 2003.
8
Incorporated by reference to First Security's Annual Report on Form 10-K for the year ended December 31, 2005.
9
Incorporated by reference to First Security's Current Report on Form 8-K filed December 1, 2010.
10
Incorporated by reference to First Security's Annual Report on Form 10-K for the year ended December 31, 2008.
11
Incorporated by reference to First Security's Current Report on Form 8-K filed January 9, 2009.
12
Incorporated by reference to First Security's Annual Report on Form 10-K for the year ended December 31, 2009.
13
Incorporated by reference to First Security's Current Report on Form 8-K filed April 29, 2010.
14
Incorporated by reference to First Security's Current Report on Form 8-K filed September 14, 2010.
15
Incorporated by reference to First Security's Current Report on Form 8-K filed April 27, 2011.
16
Incorporated by reference to First Security's Current Report on Form 8-K filed April 29, 2011.
17
Incorporated by reference to First Security's Annual Report on Form 10-K for the year ended December 31, 2011.
18
Incorporated by reference to First Security's Current Report on Form 8-K filed December 29, 2011.
19
Incorporated by reference to First Security's Current Report on Form 8-K filed February 26, 2013.
20
Incorporated by reference from Appendix A to First Security's Proxy Statement filed May 1, 2012.
21      Incorporated by reference to First Security's Annual Report on Form 10-K for the year ended December 31, 2012.
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