Atlantic Capital Bancshares, Inc. (Form: 10-Q, Received: 05/09/2018 14:39:05)

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_______________________________________________

FORM 10-Q

_______________________________________________

(Mark One)



ý	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2018



¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934

For the transition period from to

COMMISSION FILE NO. 001 -37615

_________________________________________________

ATLANTIC CAPITAL BANCSHARES, INC.

(Exact Name of Registrant as Specified in its Charter)

_________________________________________________



Georgia	20-5728270
(State of Incorporation)	(I.R.S. Employer Identification No.)

945 East Paces Ferry Road NE, Suite 1600, Atlanta, Georgia	30326
(Address of principal executive offices)	(Zip Code)



	(404) 995-6050
	(Registrant’s telephone number, including area code)
	3280 Peachtree Road NE, Suite 1600 Atlanta, Georgia 30305
	(Former name, former address, and former fiscal year, if changed since last report)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities and Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No ¨

Indicate by check mark whether the Registrant has submitted electronically and posted on its Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the Registrant was required to submit and post such files). Yes ý No ¨

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.



Large accelerated filer	¨		Accelerated filer	ý
Non-accelerated filer	¨	(Do not check if a smaller reporting company)
			Smaller reporting company	¨
			Emerging growth company	ý

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No ý

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: Common Stock, no par value: 26,037,219 shares outstanding as of May 1, 2018

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Atlantic Capital Bancshares, Inc.

Form 10-Q

INDEX



		Page No.
PART I.	FINANCIAL INFORMATION	1

Item 1.	Financial Statements (Unaudited)	1

	Consolidated Balance Sheets - March 31, 2018 and December 31, 2017	1

	Consolidated Statements of Income - Three Months ended March 31, 2018 and 2017	2

	Consolidated Statements of Comprehensive Income - Three Months ended March 31, 2018 and 2017	3

	Consolidated Statements of Shareholders’ Equity - Three Months ended March 31, 2018 and 2017	4

	Consolidated Statements of Cash Flows - Three Months ended March 31, 2018 and 2017	5

	Notes to Unaudited Consolidated Financial Statements	6

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	33

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	53

Item 4.	Controls and Procedures	53

PART II.	OTHER INFORMATION	54

Item 1.	Legal Proceedings	54

Item 1A.	Risk Factors	54

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	54

Item 3.	Defaults Upon Senior Securities	54

Item 4.	Mine Safety Disclosures	54

Item 5.	Other Information	54

Item 6.	Exhibits	55

SIGNATURES		56

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PART I - FINANCIAL INFORMATION


ITEM 1.	FINANCIAL STATEMENTS (UNAUDITED)

Atlantic Capital Bancshares, Inc. and Subsidiary

Consolidated Balance Sheets



	March 31, 2018			December 31, 2017
(in thousands, except share data)	(unaudited)			December 31, 2017
ASSETS
Cash and due from banks	$	39,985		$	38,086
Interest-bearing deposits in banks	62,787			281,247
Other short-term investments	9,669			10,681
Cash and cash equivalents	112,441			330,014
Securities available-for-sale	458,730			449,117
Other investments	37,949			32,174
Loans held for sale	835			1,487
Loans held for investment	1,959,421			1,933,839
Less: allowance for loan losses	(19,885		)	(19,344		)
Loans held for investment, net	1,939,536			1,914,495
Premises and equipment, net	15,475			12,054
Bank owned life insurance	64,014			63,667
Goodwill and intangible assets, net	27,485			27,633
Other real estate owned	927			1,215
Other assets	61,273			59,565
Total assets	$	2,718,665		$	2,891,421



LIABILITIES AND SHAREHOLDERS’ EQUITY
Deposits:
Noninterest-bearing demand	$	599,838		$	732,442
Interest-bearing checking	302,636			306,331
Savings	29,407			26,573
Money market	911,449			1,117,891
Time	140,594			138,612
Brokered deposits	112,376			128,816
Total deposits	2,096,300			2,450,665
Federal funds purchased and securities sold under agreements to repurchase	47,855			—
Federal Home Loan Bank borrowings	185,000			45,000
Long-term debt	49,577			49,535
Other liabilities	32,874			37,796
Total liabilities	2,411,606			2,582,996
SHAREHOLDERS’ EQUITY
Preferred Stock, no par value – 10,000,000 shares authorized; no shares issued and outstanding as of March 31, 2018 and December 31, 2017	—			—
Common stock, no par value – 100,000,000 shares authorized; 25,772,208 and 25,712,909 shares issued and outstanding as of March 31, 2018, and December 31, 2017, respectively	300,893			299,474
Retained earnings	18,693			12,810
Accumulated other comprehensive (loss) income	(12,527		)	(3,859		)
Total shareholders’ equity	307,059			308,425
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	2,718,665		$	2,891,421

See Accompanying Notes to Consolidated Financial Statements

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Atlantic Capital Bancshares, Inc. and Subsidiary

Consolidated Statements of Income

(Unaudited)



	Three Months Ended
	March 31,
(in thousands, except per share data)	2018			2017
INTEREST INCOME
Loans, including fees	$	22,675		$	19,994
Investment securities available-for-sale	2,592			2,018
Interest and dividends on other interest-earning assets	715			449
Total interest income	25,982			22,461
INTEREST EXPENSE
Interest on deposits	3,044			2,047
Interest on Federal Home Loan Bank advances	509			302
Interest on federal funds purchased and securities sold under agreements to repurchase	83			36
Interest on long-term debt	829			823
Total interest expense	4,465			3,208
NET INTEREST INCOME BEFORE PROVISION FOR LOAN LOSSES	21,517			19,253
Provision for loan losses	772			634
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES	20,745			18,619
NONINTEREST INCOME
Service charges	1,192			1,349
Gain (loss) on sales of other assets	(46		)	78
Mortgage income	304			257
Trust income	518			407
Derivatives income	114			(51		)
Bank owned life insurance	369			378
SBA lending activities	1,302			1,227
Other noninterest income	230			212
Total noninterest income	3,983			3,857
NONINTEREST EXPENSE
Salaries and employee benefits	12,077			11,065
Occupancy	1,355			1,230
Equipment and software	787			805
Professional services	832			904
Postage, printing and supplies	58			85
Communications and data processing	1,043			987
Marketing and business development	190			270
FDIC premiums	147			314
Amortization of intangibles	343			470
Foreclosed property/problem asset expense	282			3
Other noninterest expense	1,278			1,611
Total noninterest expense	18,392			17,744
INCOME BEFORE PROVISION FOR INCOME TAXES	6,336			4,732
Provision for income taxes	1,298			1,502
NET INCOME	$	5,038		$	3,230
NET INCOME PER SHARE:
Net income per share – basic	$	0.20		$	0.13
Net income per share – diluted	$	0.19		$	0.13

See Accompanying Notes to Consolidated Financial Statements

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Atlantic Capital Bancshares, Inc. and Subsidiary

Consolidated Statements of Comprehensive Income

(Unaudited)



	Three Months Ended
	March 31,
(in thousands)	2018			2017
Net income	$	5,038		$	3,230
Other comprehensive income
Unrealized gains (losses) on available-for-sale securities:
Unrealized holding gains (losses) arising during the period, net of tax of ($2,137) and $227, respectively	(6,414		)	364
Unrealized gains on available-for-sale securities, net of tax	(6,414		)	364
Cash flow hedges:
Net unrealized derivative gains (losses) on cash flow hedges, net of tax of ($470) and ($91), respectively	(1,410		)	(146		)
Changes from cash flow hedges	(1,410		)	(146		)
Other comprehensive income (loss), net of tax	(7,824		)	218
Comprehensive income (loss)	$	(2,786	)	$	3,448

See Accompanying Notes to Consolidated Financial Statements

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Atlantic Capital Bancshares, Inc. and Subsidiary

Consolidated Statements of Shareholders’ Equity

(Unaudited)



	Common Stock						Accumulated Other Comprehensive Income (Loss)
(in thousands, except share data)	Shares		Amount		Retained Earnings		Accumulated Other Comprehensive Income (Loss)			Total
Balance - December 31, 2016	25,093,135		$	292,747	$	16,536	$	(5,625	)	$	303,658
Comprehensive income:
Net Income	—		—		3,230		—			3,230
Change in unrealized gains on investment securities available-for-sale, net	—		—		—		364			364
Change in unrealized gains on cash flow hedges	—		—		—		(146		)	(146		)
Total comprehensive income										3,448
Issuance of common stock for option exercises	380,079		2,281		—		—			2,281
Issuance of common stock for long-term incentive plan	61,799		1,209		—		—			1,209
Restricted stock activity	—		229		—		—			229
Stock-based compensation	—		142		—		—			142
Balance - March 31, 2017	25,535,013		$	296,608	$	19,766	$	(5,407	)	$	310,967



Balance - December 31, 2017	25,712,909		$	299,474	$	12,810	$	(3,859	)	$	308,425
Comprehensive income:
Net Income	—		—		5,038		—			5,038
Reclassification of tax effects from AOCI	—		—		844		(844		)	—
Change in unrealized gains on investment securities available-for-sale, net	—		—		—		(6,414		)	(6,414		)
Change in unrealized gains (losses) on cash flow hedges	—		—		—		(1,410		)	(1,410		)
Total comprehensive income (loss)										(2,786		)
Change in accounting principle - Revenue Recognition	—		—		1		—			1
Net forfeitures of restricted stock	(2,023	)	—		—		—			—
Issuance of common stock for option exercises	22,481		325		—		—			325
Issuance of common stock for long-term incentive plan	38,841		687		—		—			687
Restricted stock activity	—		349		—		—			349
Stock-based compensation	—		58		—		—			58
Balance - March 31, 2018	25,772,208		$	300,893	$	18,693	$	(12,527	)	$	307,059

See Accompanying Notes to Consolidated Financial Statements

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Atlantic Capital Bancshares, Inc. and Subsidiary

Consolidated Statements of Cash Flows

(Unaudited)



	Three Months Ended
	March 31,
(in thousands)	2018			2017
OPERATING ACTIVITIES
Net income	$	5,038		$	3,230
Adjustments to reconcile net income to net cash provided by operating activities
Provision for loan losses	772			634
Depreciation, amortization, and accretion	1,078			1,428
Amortization of restricted stock compensation	349			229
Stock option compensation	58			142
Loss on disposition of premises and equipment, net	44			—
Net write downs and losses (gains) on sales of other real estate owned	279			(78		)
Net increase in cash value of bank owned life insurance	(347		)	(356		)
Origination of servicing assets	(371		)	(267		)
Proceeds from sales of SBA loans	19,337			11,698
Net gains on sale of SBA loans	(1,113		)	(762		)
Changes in operating assets and liabilities -
Net change in loans held for sale	652			5,978
Net (increase) decrease in other assets	(98		)	3,774
Net decrease in accrued expenses and other liabilities	(4,234		)	(4,202		)
Net cash provided by operating activities	21,444			21,448
INVESTING ACTIVITIES
Activity in securities available-for-sale:
Prepayments	11,622			10,804
Maturities and calls	65			1,000
Purchases	(30,560		)	(121,427		)
Net change in loans held for investment	(44,037		)	67,244
(Purchases) proceeds of Federal Home Loan Bank stock, net	(6,097		)	(4,631		)
Proceeds from sales of other real estate	9			216
(Purchases) of premises and equipment, net	(3,834		)	(703		)
Net cash (used in) investing activities	(72,832		)	(47,497		)
FINANCING ACTIVITIES
Net change in deposits	(354,365		)	(34,541		)
Net change in short-term borrowings	47,855			—
Proceeds from Federal Home Loan Bank advances	430,000			474,000
Repayments of Federal Home Loan Bank advances	(290,000		)	(367,000		)
Proceeds from exercise of stock options	325			2,281
Net cash (used in) provided by financing activities	(166,185		)	74,740
NET CHANGE IN CASH AND CASH EQUIVALENTS	(217,573		)	48,691
CASH AND CASH EQUIVALENTS – beginning of period	330,014			165,725
CASH AND CASH EQUIVALENTS – end of period	$	112,441		$	214,416

	Three Months Ended
	March 31,
	2018			2017
SUPPLEMENTAL SCHEDULE OF CASH FLOWS
Interest paid	$	3,715		$	4,028
Income taxes paid	—			110

See Accompanying Notes to Consolidated Financial Statements

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ATLANTIC CAPITAL BANCSHARES, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1 – ACCOUNTING POLICIES AND BASIS OF PRESENTATION

Basis of Presentation

The accounting and financial reporting policies of Atlantic Capital Bancshares, Inc. (“Atlantic Capital” or the “Company”) and its subsidiary, Atlantic Capital Bank, N.A. (the “Bank”), conform to accounting principles generally accepted in the United States of America (“GAAP”) and general banking industry practices. The accompanying interim consolidated financial statements have not been audited. All material intercompany balances and transactions have been eliminated.

In management’s opinion, all accounting adjustments necessary to accurately reflect the financial position and results of operations on the accompanying financial statements have been made. These adjustments are normal and recurring accruals considered necessary for a fair and accurate presentation. The accompanying consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in Atlantic Capital’s filing on Form 10-K. The results for interim periods are not necessarily indicative of results for the full year or any other interim periods. Certain prior period amounts have been reclassified to conform to the current year presentation.

NOTE 2 – ACCOUNTING STANDARDS UPDATES AND RECENTLY ADOPTED STANDARDS

In February 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2018-02, “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income.” The guidance gives entities the option to reclassify into retained earnings tax effects related to items in accumulated other comprehensive income (“OCI”) that were stranded in accumulated OCI as a result of tax reform. It is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption in any period is permitted and Atlantic Capital adopted ASU 2018-02 as of January 1, 2018. The adoption of this update resulted in a reclassification of approximately $844,000 between accumulated OCI and retained earnings, and a net impact of zero to total shareholders’ equity.

In August 2017, the FASB issued ASU 2017-12, “Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities.” The purpose of this updated guidance is to better align a company’s financial reporting for hedging activities with the economic objectives of those activities. ASU 2017-12 is effective for public business entities for fiscal years beginning after December 15, 2018, with early adoption, including adoption in an interim period, permitted. Atlantic Capital adopted ASU 2017-12 as of January 1, 2018. The guidance requires a modified retrospective transition method resulting in the cumulative effect of the change on the opening balance of each affected component of equity in the statement of financial position as of the date of adoption. Adoption did not have a material impact on Atlantic Capital’s consolidated financial statements.

In May 2017, the FASB issued ASU 2017-09, “Compensation - Stock Compensation (Topic 718): Scope and Modification Accounting.” The amendments in this ASU provide guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in accordance with Topic 718. The amendments were effective for interim and annual reporting periods beginning after December 15, 2017. This ASU did not have a material impact on Atlantic Capital’s consolidated financial statements.

In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments,” to address diversity in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The amendments provide guidance on the following eight specific cash flow issues: 1) debt prepayment or debt extinguishment costs; 2) settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing; 3) contingent consideration payments made after a business combination; 4) proceeds from the settlement of insurance claims; 5) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies; 6) distributions received from equity method investees; 7) beneficial interests in securitization transactions; and 8) separately identifiable cash flows and application of the predominance principle. The amendments were effective for public companies for fiscal years beginning after December 31, 2017, and interim periods within those fiscal years. This ASU did not have a material impact on the Company’s consolidated financial statements.

In January 2016, the FASB issued ASU 2016-1, “Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Liabilities.” The guidance in this update requires that equity investments (except those accounted for under the equity method of accounting) be measured at fair value with changes in fair value recognized in net income. However, an entity may choose to measure equity investments that do not have readily determinable fair values at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. The guidance also simplifies the impairment assessment of equity investments without readily determinable fair values

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by requiring a qualitative assessment to identify impairment. In addition, the guidance requires that public business entities base their fair value disclosures for financial instruments that are not measured at fair value in the financial statements on the exit price notion. For public entities, this update was effective for fiscal years beginning after December 15, 2017. The adoption of this update did not have a material impact on Atlantic Capital’s consolidated financial statements, however Atlantic Capital changed the disclosure of financial instruments not measured at fair value to reflect the exit price notion.

In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers.” The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. For public companies, this guidance was effective for annual and interim periods beginning after December 15, 2017. Atlantic Capital completed its review of the impact of ASU 2014-09 on components of non-interest income and did not find any significant changes to its methodology of recognizing revenue. Revenue streams impacted by the ASU included service charges, trust income, sales of financed other real estate, and check printing revenue. The Company recorded a cumulative effect adjustment to first quarter 2018 opening retained earnings in an amount less than $2,000 , and included newly applicable revenue disclosures.

In March 2017, the FASB issued ASU 2017-08, “Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities.” This guidance shortens the premium amortization period for certain callable debt securities by requiring amortization to the earliest call date. The standard is effective for public companies for annual and interim periods beginning after December 15, 2020. The adoption of this update is not expected to have a material impact on Atlantic Capital’s consolidated financial statements.

In January 2017, the FASB issued ASU 2017-04, “Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment,” which intends to simplify goodwill impairment testing by eliminating the second step of the analysis under which the implied fair value of goodwill is determined as if the reporting unit were being acquired in a business combination. The update instead requires entities to compare the fair value of a reporting unit with its carrying amount and recognize an impairment charge for any amount by which the carrying amount exceeds the reporting unit’s fair value, to the extent that the loss recognized does not exceed the amount of goodwill allocated to that reporting unit. ASU 2017-04 must be applied prospectively and is effective for the Company on January 1, 2020. Early adoption is permitted. Atlantic Capital does not expect the new guidance to have a material impact on its financial condition or results of operations.

In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326) Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 requires an entity to utilize a new impairment model known as the current expected credit loss (“CECL”) model to estimate its lifetime “expected credit loss” and record an allowance that, when deducted from the amortized cost basis of the financial asset, presents the net amount expected to be collected on the financial asset. The CECL model is expected to result in more timely recognition of credit losses. ASU 2016-13 also requires new disclosures for financial assets measured at amortized cost, loans and available-for-sale debt securities. ASU 2016-13 is effective for public companies for annual periods beginning after December 15, 2019, including interim periods within those fiscal years. Entities will apply the standard’s provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted. Atlantic Capital is in the process of evaluating the impact of the adoption of ASU 2016-13 on the Company’s consolidated financial statements and disclosures.

In February 2016, the FASB issued ASU 2016-2, “Leases.” Under the new guidance, leases classified as operating leases under previous GAAP must be recorded on the balance sheet. A lessee should recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. The standard is effective for public companies for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted. The new standard must be adopted using a modified retrospective transition, and provides for certain practical expedients. Upon adoption, Atlantic Capital expects to report higher assets and liabilities as a result of including leases on the consolidated balance sheet. The Company does not expect the new guidance to have a material impact on the consolidated statement of income or the consolidated statement of shareholders’ equity.

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NOTE 3 – ACQUISITIONS AND DIVESTITURES

Sale of Southeastern Trust Company (“SETCO”)

On December 14, 2017, the Bank entered into an agreement with The Banc Group, LLC to sell its trust business, a division of the Bank known as Southeastern Trust Company (“SETCO”), for approximately $1.7 million . The Banc Group, LLC is controlled by a former director and Chief Operating Officer of the Company. Subject to customary closing conditions, including the receipt of all regulatory approvals, the sale of SETCO is expected to close during the second quarter of 2018.

NOTE 4 – BALANCE SHEET OFFSETTING

Atlantic Capital enters into reverse repurchase agreements in order to invest short-term funds. Atlantic Capital enters into repurchase agreements for short-term financing needs.

The following table presents a summary of amounts outstanding under reverse repurchase agreements, repurchase agreements, and derivative financial instruments including those entered into in connection with the same counterparty under master netting agreements as of March 31, 2018 and December 31, 2017 . While these agreements are typically over-collateralized, U.S. GAAP requires disclosures in this table to limit the amount of such collateral to the amount of the related recognized asset or liability for each counterparty.



(in thousands)							Gross Amounts not Offset in the Balance Sheet
March 31, 2018	Gross Amounts of Recognized Assets		Gross Amounts Offset on the Balance Sheet		Net Asset Balance		Financial Instruments			Cash Collateral Received			Net Amount
Reverse repurchase agreements	$	9,669	$	—	$	9,669	$	(9,669	)	$	—		$	—
Derivatives	2,614		—		2,614		—			—			2,614
Total	$	12,283	$	—	$	12,283	$	(9,669	)	$	—		$	2,614
							Gross Amounts not Offset in the Balance Sheet
	Gross Amounts of Recognized Liabilities		Gross Amounts Offset on the Balance Sheet		Net Liability Balance		Financial Instruments			Cash Collateral Pledged			Net Amount
Repurchase agreements	$	7,855	$	—	$	7,855	$	(11,532	)	$	—		$	—
Derivatives	5,360		—		5,360		(4,039		)	(1,321		)	—
Total	$	13,215	$	—	$	13,215	$	(15,571	)	$	(1,321	)	$	—

							Gross Amounts not Offset in the Balance Sheet
December 31, 2017	Gross Amounts of Recognized Assets		Gross Amounts Offset on the Balance Sheet		Net Asset Balance		Financial Instruments			Cash Collateral Received			Net Amount
Reverse repurchase agreements	$	10,681	$	—	$	10,681	$	(10,681	)	$	—		$	—
Derivatives	3,018		—		3,018		—			—			3,018
Total	$	13,699	$	—	$	13,699	$	(10,681	)	$	—		$	3,018
							Gross Amounts not Offset in the Balance Sheet
	Gross Amounts of Recognized Liabilities		Gross Amounts Offset on the Balance Sheet		Net Liability Balance		Financial Instruments			Cash Collateral Pledged			Net Amount
Repurchase agreements	$	—	$	—	$	—	$	—		$	—		$	—
Derivatives	4,023		—		4,023		(2,705		)	(1,318		)	—
Total	$	4,023	$	—	$	4,023	$	(2,705	)	$	(1,318	)	$	—

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NOTE 5 – SECURITIES

The following table presents the amortized cost, unrealized gains and losses, and fair value of securities available-for-sale at March 31, 2018 and December 31, 2017 .



Available-For-Sale	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(in thousands)
March 31, 2018
Debt securities—
U.S. Government agencies	$	37,364	$	2	$	(834	)	$	36,532
U.S. states and political divisions	92,005		18		(6,210		)	85,813
Trust preferred securities	4,761		—		(111		)	4,650
Corporate debt securities	12,925		—		(468		)	12,457
Residential mortgage-backed securities	325,809		2,414		(8,945		)	319,278
Total	$	472,864	$	2,434	$	(16,568	)	$	458,730

December 31, 2017
Debt securities—
U.S. Government agencies	$	34,699	$	11	$	(599	)	$	34,111
U.S. states and political divisions	92,169		237		(2,405		)	90,001
Trust preferred securities	4,754		—		(104		)	4,650
Corporate debt securities	12,948		60		(386		)	12,622
Residential mortgage-backed securities	310,129		2,423		(4,819		)	307,733
Total	$	454,699	$	2,731	$	(8,313	)	$	449,117

The following table presents the amortized cost and fair value of debt securities by contractual maturity at March 31, 2018 . Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.



	Available-For-Sale
	Amortized Cost		Fair Value
	(in thousands)
Within 1 year	$	—	$	—
Over 1 year through 5 years	23,099		22,605
5 years to 10 years	52,910		51,238
Over 10 years	71,046		65,609
	147,055		139,452
Residential mortgage-backed securities	325,809		319,278
Total	$	472,864	$	458,730

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The following table summarizes available-for-sale securities in an unrealized loss position as of March 31, 2018 and December 31, 2017 .



	Less than 12 months					12 months or greater					Totals
Available-For-Sale	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
	(in thousands)
March 31, 2018
U.S. Government agencies	$	25,903	$	(499	)	$	8,848	$	(335	)	$	34,751	$	(834	)
U.S. states and political divisions	28,017		(1,017		)	54,396		(5,193		)	82,413		(6,210		)
Trust preferred securities	—		—			4,650		(111		)	4,650		(111		)
Corporate debt securities	9,464		(147		)	2,993		(321		)	12,457		(468		)
Residential mortgage-backed securities	183,751		(3,844		)	118,906		(5,101		)	302,657		(8,945		)
Totals	$	247,135	$	(5,507	)	$	189,793	$	(11,061	)	$	436,928	$	(16,568	)
December 31, 2017
U.S. Government agencies	$	22,148	$	(348	)	$	9,145	$	(251	)	$	31,293	$	(599	)
U.S. states and political divisions	14,009		(183		)	58,744		(2,222		)	72,753		(2,405		)
Trust preferred securities	—		—			4,650		(104		)	4,650		(104		)
Corporate debt securities	2,989		(27		)	2,970		(359		)	5,959		(386		)
Residential mortgage-backed securities	155,637		(1,344		)	126,580		(3,475		)	282,217		(4,819		)
Totals	$	194,783	$	(1,902	)	$	202,089	$	(6,411	)	$	396,872	$	(8,313	)

At March 31, 2018 , there were 318 available-for-sale securities that were in an unrealized loss position. Atlantic Capital does not intend to sell and does not believe it will be required to sell securities in an unrealized loss position prior to the recovery of their amortized cost basis. Unrealized losses at March 31, 2018 and December 31, 2017 were attributable to changes in interest rates.

Management evaluates securities for other-than-temporary impairment on a quarterly basis. Consideration is given to the length of time and the extent to which the fair value has been less than cost, the financial condition and near-term prospects of the issuer, among other factors. In analyzing an issuer’s financial condition, management considers whether the securities are issued by the federal government or its agencies, whether downgrades by bond rating agencies have occurred, and industry analysts’ reports. No impairment charges were recognized during the three months ended March 31, 2018 or 2017 .

Realized gains and losses are derived using the specific identification method for determining the cost of securities sold. No securities were sold during the three months ended March 31, 2018 and 2017 .

Investment securities with a carrying value of $79.9 million and $93.9 million were pledged to secure public funds and other borrowings at March 31, 2018 and December 31, 2017 , respectively.

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NOTE 6 – LOANS AND ALLOWANCE FOR LOAN LOSSES

The composition of the loan portfolio as of March 31, 2018 and December 31, 2017 , is summarized below.



	March 31, 2018			December 31, 2017
	(in thousands)
Loans held for sale
Other loans held for sale	$	835		$	1,487
Total loans held for sale	$	835		$	1,487

Loans held for investment
Commercial loans:
Commercial and industrial	$	636,181		$	615,359
Commercial real estate	914,100			940,415
Construction and land	145,904			115,495
Mortgage warehouse participations	44,575			39,981
Total commercial loans	1,740,760			1,711,250
Residential:
Residential mortgages	105,255			104,484
Home equity	70,712			76,244
Total residential loans	175,967			180,728
Consumer	30,966			29,393
Other	15,181			16,278
Total loans	1,962,874			1,937,649
Less net deferred fees and other unearned income	(3,453		)	(3,810		)
Less allowance for loan losses	(19,885		)	(19,344		)
Loans held for investment, net	$	1,939,536		$	1,914,495

At March 31, 2018 and December 31, 2017 , loans with a carrying value of $717.3 million and $667.2 million , respectively, were pledged as collateral to secure FHLB advances and the Federal Reserve discount window.

At March 31, 2018 , the carrying value and outstanding balance of Purchased Credit Impaired (“PCI”) loans accounted for under ASC 310-30 was $11.8 million and $14.0 million , respectively. At December 31, 2017 , the carrying value and outstanding balance of PCI loans accounted for under ASC 310-30 was $11.8 million and $14.1 million , respectively. The following table presents changes in the value of the accretable yield for acquired loans accounted for under ASC 310-30.



	For the Three Months Ended
	March 31, 2018			March 31, 2017
	(in thousands)
Balance at beginning of period	$	2,316		$	3,467
Accretion	(298		)	(444		)
Reclassification of nonaccretable discount due to change in expected cash flows	96			251
Other changes, net	295			95
Balance at end of period	$	2,409		$	3,369

In addition to the accretable yield on PCI loans, the fair value adjustments on purchased loans outside the scope of ASC 310-30 are also accreted to interest income over the life of the loans. At March 31, 2018 , the remaining accretable fair value discount on loans acquired through a business combination and not accounted for under ASC 310-30 was $2.5 million compared to $2.8 million at December 31, 2017 .

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The allowance for loan losses represents management’s estimate of probable incurred losses in the loan portfolio as of the end of the period. It is comprised of specific reserves for impaired loans and a general allowance for pools of loans with similar characteristics not individually evaluated. The allowance is regularly evaluated for loan losses to maintain an adequate level to absorb probable current inherent losses in the loan portfolio. Factors contributing to the determination of the allowance include the credit worthiness of the borrower, changes in the value of pledged collateral, and general economic conditions. Most loan commitments rated substandard or worse are specifically reviewed for loss potential. For loans deemed to be impaired, a specific allocation is assigned based on the losses expected to be realized from those loans.

The following table presents the balance and activity in the allowance for credit losses by portfolio segment for the three months ended March 31, 2018 and 2017 .



	2018												2017
Three Months Ended March 31,	Commercial			Residential			Consumer			Total			Commercial			Residential			Consumer			Total
	(in thousands)
Allowance for loan losses:
Beginning balance	$	18,267		$	802		$	275		$	19,344		$	18,717		$	1,418		$	460		$	20,595
Provision for loan losses	637			154			(19		)	772			297			34			303			634
Loans charged-off	(126		)	(128		)	(3		)	(257		)	(913		)	(46		)	(332		)	(1,291		)
Recoveries	19			—			7			26			—			—			1			1
Total ending allowance balance	$	18,797		$	828		$	260		$	19,885		$	18,101		$	1,406		$	432		$	19,939

The general component of the allowance for loan losses is based on the incurred losses inherent in the portfolio. The loss factors are determined through the generation of probabilities of default (“PDs”) and losses given default (“LGDs”) for groups of similar loans with similar credit grades where Loss Rate = PD x LGD. The PDs and LGDs for the loan portfolio are calculated based on Atlantic Capital’s loss history as well as available market-based data. The loss factor for each pool of loans is adjusted based on qualitative and environmental factors to account for conditions in the current environment which management believes are likely to cause a difference between the calculated loss based on historical performance and the incurred loss in the existing portfolio. These factors include: changes in policies and procedures, changes in the economy, changes in nature or volume of the portfolio and in the terms of loans, changes in lending management, changes in past dues and credit migration, changes in the loan review system, changes in the value of collateral and concentration risk and changes in external factors, such as competition, legal and regulatory. Quarterly, management evaluates these factors to determine an adjustment unique to Atlantic Capital and its market.

Charge-offs are recognized when the amount of the loss is quantifiable and timing is known. Collateral based loan charge-offs are measured based on the difference between the loan’s carrying value, including deferred fees, and the estimated net realizable value of the loan. When assessing property value for the purpose of determining a charge-off, a third-party appraisal or an independently derived internal evaluation is generally employed.

A loan is considered to be impaired when, based on current information and events, it is probable that all amounts due according to the contractual terms of the loan agreement will not be collected. Loans for which the terms have been modified or granted an economic concession, and for which the borrower is experiencing financial difficulties, are considered troubled debt restructurings (“TDRs”) and classified as impaired. Factors considered by management in determining impairment include payment status, collateral value, and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record, and the amount of the shortfall in relation to the principal and interest owed. A specific allowance is established for individually evaluated impaired loans as needed. Reserves on impaired loans are measured based on the present value of expected future cash flows discounted at the loan’s effective interest rate or the observable market price, or the fair value of the underlying collateral of the loan if the loan is collateral dependent.

Atlantic Capital’s policy is to place loans on nonaccrual status, when, in the opinion of management, the principal and interest on a loan is not likely to be repaid in accordance with the loan terms or when the loan becomes 90 days past due and is not both well secured and in the process of collection. When a loan is classified on nonaccrual status, interest previously accrued but not collected is reversed against current interest revenue. Principal and interest payments received on a nonaccrual loan are applied to reduce outstanding principal.

PCI loans are considered past due or delinquent when the contractual principal or interest due in accordance with the terms of the loan agreement remains unpaid after the due date of the scheduled payment. Loans accounted for under ASC 310-30 were not classified as nonaccrual at March 31, 2018 or December 31, 2017 , as the carrying value of the respective loan or pool of loans’ cash flows were considered estimable and collection was probable. Therefore, interest revenue, through accretion of the difference between the carrying value of the loans and the expected cash flows (accretable yield), is being recognized on all acquired loans accounted for under ASC 310-30.

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The balance in the allowance for loan losses and the recorded investment in loans by portfolio segment and based on impairment method is presented in the following table as of March 31, 2018 and December 31, 2017 .



March 31, 2018	Commercial		Residential		Consumer		Total
	(in thousands)
Allowance for loan losses:
Ending allowance balance attributable to loans
Individually evaluated for impairment	$	276	$	—	$	—	$	276
Collectively evaluated for impairment	18,516		828		260		19,604
PCI	5		—		—		5
Total ending allowance balance	$	18,797	$	828	$	260	$	19,885

Loans:
Loans individually evaluated for impairment	$	6,731	$	183	$	—	$	6,914
Loans collectively evaluated for impairment	1,724,816		173,172		46,135		1,944,123
PCI	9,213		2,612		12		11,837
Total ending loans balance	$	1,740,760	$	175,967	$	46,147	$	1,962,874

December 31, 2017	Commercial		Residential		Consumer		Total
	(in thousands)
Allowance for loan losses:
Ending allowance balance attributable to loans
Individually evaluated for impairment	$	306	$	—	$	—	$	306
Collectively evaluated for impairment	17,918		800		275		18,993
PCI	43		2		—		45
Total ending allowance balance	$	18,267	$	802	$	275	$	19,344

Loans:
Loans individually evaluated for impairment	$	6,886	$	186	$	—	$	7,072
Loans collectively evaluated for impairment	1,694,948		178,204		45,671		1,918,823
PCI	9,416		2,338		—		11,754
Total ending loans balance	$	1,711,250	$	180,728	$	45,671	$	1,937,649

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The following table presents information on Atlantic Capital’s impaired loans for the three months ended March 31, 2018 and 2017 :



	For the Three Months Ended March 31,
	2018										2017
	Unpaid Principal Balance		Recorded Investment		Related Allowance		Average Balance of Recorded Investment While Impaired		Interest Income Recognized During Impairment		Unpaid Principal Balance		Recorded Investment		Related Allowance		Average Balance of Recorded Investment While Impaired		Interest Income Recognized During Impairment
	(in thousands)
Impaired loans with no related allowance recorded:
Commercial and industrial	$	1,035	$	972	$	—	$	973	$	13	$	1,132	$	1,069	$	—	$	1,550	$	17
Commercial real estate	1,755		1,592		—		1,592		—		2,388		2,226		—		2,303		—
Construction and land	—		—		—		—		—		—		—		—		—		—
Residential mortgages	228		183		—		184		—		244		198		—		225		—
Home equity	—		—		—		—		—		549		549		—		549		—
Mortgage warehouse	—		—		—		—		—		—		—		—		—		—
Consumer	—		—		—		—		—		—		—		—		—		—
Total	$	3,018	$	2,747	$	—	$	2,749	$	13	$	4,313	$	4,042	$	—	$	4,627	$	17
Impaired loans with an allowance recorded:
Commercial and industrial	$	3,643	$	3,643	$	168	$	3,691	$	46	$	8,316	$	8,316	$	2,077	$	8,357	$	108
Commercial real estate	524		524		108		544		6		750		750		159		753		7
Construction and land	—		—		—		—		—		—		—		—		—		—
Residential mortgages	—		—		—		—		—		147		147		4		147		—
Home equity	—		—		—		—		—		—		—		—		—		—
Mortgage warehouse	—		—		—		—		—		—		—		—		—		—
Consumer	—		—		—		—		—		—		—		—		—		—
Total	$	4,167	$	4,167	$	276	$	4,235	$	52	$	9,213	$	9,213	$	2,240	$	9,257	$	115
Total impaired loans	$	7,185	$	6,914	$	276	$	6,984	$	65	$	13,526	$	13,255	$	2,240	$	13,884	$	132

Atlantic Capital evaluates loans in accordance with ASC 310-40, Troubled Debt Restructurings by Creditors. TDRs are loans in which Atlantic Capital has modified the terms or granted an economic concession to a borrower who is experiencing financial difficulties. These modifications may include interest rate reductions, term extensions and other concessions intended to minimize losses.

As of March 31, 2018 and December 31, 2017 , the Company had a recorded investment in TDRs of $5.2 million and $5.3 million , respectively. The Company had commitments to lend additional funds of $28,000 and $26,000 on loans modified as TDRs, as of March 31, 2018 and December 31, 2017 , respectively. The Company did not modify any new loans as a TDR during the three months ended March 31, 2018 or 2017 and there were no subsequent defaults on prior TDRs.

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Atlantic Capital individually rates loans based on internal credit risk ratings using numerous factors, including thorough analysis of historical and expected cash flows, consumer credit risk scores (FICO scores), rating agency information, LTV ratios, collateral, collection experience, and other internal metrics. Atlantic Capital uses a dual rating system. The likelihood of default of a credit transaction is graded in the Obligor Rating. The risk of loss given default is graded in the Facility Rating. The Obligor Rating is determined through credit analysis. Facility Ratings are used to describe the value to the Company that the collateral represents. Facility Ratings are based on the collateral package or market expectations regarding the value and liquidity of the collateral. Ratings are generally reviewed at least annually or more frequently if there is a material change in creditworthiness. Exceptions to this policy may include well collateralized term loans and loans to individuals with limited exposure or complexity.

Atlantic Capital uses the following definitions for risk ratings:

Pass: Loans that are analyzed individually as part of the above described process and that do not meet the criteria of special mention, substandard or doubtful.

Special Mention: Loans classified as special mention have a potential weakness that requires management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.

Substandard: Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

Doubtful: Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

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As of March 31, 2018 and December 31, 2017 , and based on the most recent analysis performed, the risk category of loans by class of loans is as follows.



	Pass		Special Mention		Substandard Accruing		Substandard Nonaccruing		Doubtful Nonaccruing		Total
	(in thousands)
March 31, 2018
Commercial and industrial	$	593,133	$	16,089	$	21,656	$	14	$	—	$	630,892
Commercial real estate	879,885		11,453		17,483		—		1,592		910,413
Construction and land	145,667		—		—		—		—		145,667
Residential mortgages	100,871		1,063		746		322		315		103,317
Home equity	68,869		642		304		223		—		70,038
Mortgage warehouse	44,575		—		—		—		—		44,575
Consumer/Other	45,895		—		240		—		—		46,135
Total loans, excluding PCI loans	$	1,878,895	$	29,247	$	40,429	$	559	$	1,907	$	1,951,037
Commercial and industrial	$	—	$	—	$	5,289	$	—	$	—	$	5,289
Commercial real estate	3,130		188		256		—		113		3,687
Construction and land	222		6		9		—		—		237
Residential mortgages	467		699		772		—		—		1,938
Home equity	34		288		352		—		—		674
Mortgage warehouse	—		—		—		—		—		—
Consumer/Other	—		—		12		—		—		12
Total PCI loans	$	3,853	$	1,181	$	6,690	$	—	$	113	$	11,837



	Pass		Special Mention		Substandard Accruing		Substandard Nonaccruing		Doubtful		Total
	(in thousands)
December 31, 2017
Commercial and industrial	$	572,942	$	15,643	$	21,332	$	16	$	2	$	609,935
Commercial real estate	919,939		6,227		8,906		—		1,592		936,664
Construction and land	115,255		—		—		—		—		115,255
Residential mortgages	100,342		1,075		753		398		321		102,889
Home equity	74,841		64		310		285		—		75,500
Mortgage warehouse	39,981		—		—		—		—		39,981
Consumer/Other	45,422		57		192		—		—		45,671
Total loans, excluding PCI loans	$	1,868,722	$	23,066	$	31,493	$	699	$	1,915	$	1,925,895
Commercial and industrial	$	—	$	3,881	$	1,543	$	—	$	—	$	5,424
Commercial real estate	3,151		212		276		—		112		3,751
Construction and land	222		7		11		—		—		240
Residential mortgages	428		493		674		—		—		1,595
Home equity	34		354		356		—		—		744
Mortgage warehouse	—		—		—		—		—		—
Consumer/Other	—		—		—		—		—		—
Total PCI loans	$	3,835	$	4,947	$	2,860	$	—	$	112	$	11,754

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Atlantic Capital monitors loans by past due status. The following table presents the aging of the recorded investment in past due loans as of March 31, 2018 and December 31, 2017 by class of loans.



	As of March 31, 2018
	Accruing Current		Accruing 30-89 Days Past Due		Accruing 90+ Days Past Due		Nonaccruing		PCI Loans		Total
	(in thousands)
Loans by Classification
Commercial and industrial	$	627,685	$	3,193	$	—	$	14	$	5,289	$	636,181
Commercial real estate	908,300		521		—		1,592		3,687		914,100
Construction and land	145,667		—		—		—		237		145,904
Residential mortgages	102,129		551		—		637		1,938		105,255
Home equity	69,775		5		35		223		674		70,712
Mortgage warehouse	44,575		—		—		—		—		44,575
Consumer	45,900		235		—		—		12		46,147
Total Loans	$	1,944,031	$	4,505	$	35	$	2,466	$	11,837	$	1,962,874



	As of December 31, 2017
	Accruing Current		Accruing 30-89 Days Past Due		Accruing 90+ Days Past Due		Nonaccruing		PCI Loans		Total
	(in thousands)
Loans by Classification
Commercial and industrial	$	606,677	$	3,239	$	—	$	19	$	5,424	$	615,359
Commercial real estate	932,916		2,156		—		1,592		3,751		940,415
Construction and land	114,988		267		—		—		240		115,495
Residential mortgages	100,402		1,470		298		719		1,595		104,484
Home equity	75,081		135		—		284		744		76,244
Mortgage warehouse	39,981		—		—		—		—		39,981
Consumer	45,599		72		—		—		—		45,671
Total Loans	$	1,915,644	$	7,339	$	298	$	2,614	$	11,754	$	1,937,649

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NOTE 7 – GOODWILL AND INTANGIBLE ASSETS

The carrying amount of goodwill and other intangible assets as of March 31, 2018 and December 31, 2017 is summarized below:



	March 31,			December 31,
	2018			2017
	(in thousands)
Core deposit intangible	$	9,544		$	9,544
Less: accumulated amortization	(4,967		)	(4,624		)
Less: impairment related to divested branches	(2,286		)	(2,286		)
Core deposit intangible, net	2,291			2,634
Servicing assets, net	3,435			3,240
Total other intangibles, net	5,726			5,874
Goodwill	21,759			21,759
Total goodwill and other intangible assets, net	$	27,485		$	27,633

There were no goodwill impairment charges recorded in the three months ended March 31, 2018 and 2017 . The following table presents activity for goodwill and other intangible assets:



	For the Three Months Ended March 31,
	Goodwill		Core Deposit Intangible			Total
	(in thousands)
2018
Balance, beginning of period	$	21,759	$	2,634		$	24,393
Amortization	—		(343		)	(343		)
Balance, end of period	$	21,759	$	2,291		$	24,050

2017
Balance, beginning of period	$	21,759	$	4,624		$	26,383
Amortization	—		(470		)	(470		)
Balance, end of period	$	21,759	$	4,154		$	25,913

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NOTE 8 – SERVICING ASSETS

SBA Servicing Assets

SBA servicing assets are initially recorded at fair value. Subsequently, Atlantic Capital accounts for SBA servicing assets using the amortization method and they are included in other assets. As of March 31, 2018 and December 31, 2017 , the balance of SBA loans sold and serviced by Atlantic Capital totaled $151.0 million and $135.8 million , respectively.

Changes in the balance of servicing assets for the three months ended March 31, 2018 and 2017 are presented in the following table .



	Three months ended March 31,
SBA Loan Servicing Assets	2018			2017
	(in thousands)
Beginning carrying value, net	$	2,635		$	2,359
Additions	371			267
Amortization	(134		)	(131		)
Impairment	—			—
Ending carrying value	$	2,872		$	2,495

At March 31, 2018 and December 31, 2017 , the sensitivity of the fair value of the SBA loan servicing assets to immediate changes in key economic assumptions are presented in the table below .



Sensitivity of the SBA Servicing Assets	March 31, 2018				December 31, 2017
	(dollars in thousands)
Fair value of retained servicing assets	$	3,114			$	2,865
Weighted average life	5.96 years				6.22 years
Prepayment speed:	9.45			%	8.64			%
Decline in fair value due to a 10% adverse change	$	(111	)		$	(103	)
Decline in fair value due to a 20% adverse change	$	(199	)		$	(181	)
Weighted average discount rate	12.98			%	13.01			%
Decline in fair value due to a 100 bps adverse change	$	(103	)		$	(103	)
Decline in fair value due to a 200 bps adverse change	$	(185	)		$	(180	)

The above sensitivities are hypothetical and should be used with caution. As the amounts indicate, changes in fair value based on valuation assumptions generally cannot be extrapolated because the relationship of the change in assumption to the change in fair value may not be linear. Also, the effect of a variation in a particular assumption on the fair value of the retained interest is calculated without changing any other assumption. In reality, changes in one factor may result in changes in another, which might magnify or counteract the sensitivities.

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TriNet Servicing Assets

Changes in the balance of TriNet servicing assets for the three months ended March 31, 2018 and 2017 are presented in the following table.



	Three months ended March 31,
TriNet Servicing Assets	2018			2017
	(in thousands)
Beginning carrying value, net	$	605		$	825
Additions	—			—
Amortization	(42		)	(47		)
Impairment	—			—
Ending carrying value	$	563		$	778

At March 31, 2018 and December 31, 2017 , the sensitivity of the fair value of the TriNet servicing assets to immediate changes in key economic assumptions are presented in the table below .



Sensitivity of the TriNet Servicing Assets	March 31, 2018				December 31, 2017
	(dollars in thousands)
Fair value of retained servicing assets	$	652			$	697
Weighted average life	7.35 years				7.37 years
Prepayment speed:	5.00			%	5.00			%
Decline in fair value due to a 10% adverse change	$	(9	)		$	(10	)
Decline in fair value due to a 20% adverse change	$	(18	)		$	(20	)
Weighted average discount rate	8.00			%	8.00			%
Decline in fair value due to a 100 bps adverse change	$	(17	)		$	(19	)
Decline in fair value due to a 200 bps adverse change	$	(33	)		$	(37	)

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NOTE 9 – OTHER COMPREHENSIVE INCOME (LOSS)

Other comprehensive income (loss) for Atlantic Capital consists of changes in net unrealized gains and losses on investment securities available-for-sale and derivatives. The following tables present a summary of the changes in accumulated other comprehensive income (loss) balances for the applicable periods.



	For the Three Months Ended
	March 31, 2018
	Pre-Tax Amount			Income Tax (Expense) Benefit			After-Tax Amount
	(in thousands)
Accumulated other comprehensive income (loss) beginning of period	$	(6,274	)	$	2,415		$	(3,859	)
Reclassification of tax effects from AOCI	—			(844		)	(844		)
Unrealized net gains (losses) on investment securities available-for-sale	(8,551		)	2,137			(6,414		)
Unrealized net gains (losses) on derivatives	(1,880		)	470			(1,410		)
Accumulated other comprehensive income (loss) end of period	$	(16,705	)	$	4,178		$	(12,527	)



	For the Three Months Ended
	March 31, 2017
	Pre-Tax Amount			Income Tax (Expense) Benefit			After-Tax Amount
	(in thousands)
Accumulated other comprehensive income (loss) beginning of period	$	(9,144	)	$	3,519		$	(5,625	)
Unrealized net gains (losses) on investment securities available-for-sale	591			(227		)	364
Unrealized net gains (losses) on derivatives	(237		)	91			(146		)
Accumulated other comprehensive income (loss) end of period	$	(8,790	)	$	3,383		$	(5,407	)

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NOTE 10 – EARNINGS PER COMMON SHARE

Basic earnings per share amounts are computed by dividing net income by the weighted average number of shares of common stock outstanding.

Diluted earnings per share amounts are computed by dividing net income by the weighted average number of shares of common stock outstanding and the dilutive effects of the shares awarded under the stock option plan, based on the treasury stock method using an average fair market value of the stock during the respective periods.

The following table represents the earnings per share calculations for the three months ended March 31, 2018 and 2017 .



	Three Months Ended
	March 31,
	2018		2017
(in thousands, except share and per share amounts)
Net income available to common shareholders	$	5,038	$	3,230
Weighted average shares outstanding
Basic ⁽¹⁾	25,750,824		25,320,690
Effect of dilutive securities:
Stock options and warrants	194,949		351,596
Diluted	25,945,773		25,672,286
Income per common share:
Basic	$	0.20	$	0.13
Diluted	$	0.19	$	0.13
⁽¹⁾ Unvested restricted shares are participating securities and included in basic share calculations.

Stock options outstanding of 432 at March 31, 2018 and 747 at March 31, 2017 have not been included in diluted earnings per share because to do so would have been anti-dilutive for the periods presented. These awards were considered anti-dilutive because the exercise price of the award was higher than the market value of the shares.

The Amended and Restated Articles of Incorporation of Atlantic Capital, which were approved by the Board of Directors on March 24, 2015 and by Atlantic Capital’s shareholders on May 21, 2015, authorize Atlantic Capital to issue 110,000,000 shares of capital stock, of which 10,000,000 shares are designated as preferred stock, no par value per share, and 100,000,000 shares are designated as common stock, no par value per share.

At March 31, 2018 , 25,772,208 shares of common stock were issued and outstanding. At December 31, 2017 , 25,712,909 shares of common stock were issued and outstanding.

The primary source of funds available to Atlantic Capital is payments of dividends from the Bank. The Bank has not paid any dividends to Atlantic Capital in 2018 or 2017. Banking laws and other regulations limit the amount of dividends a bank subsidiary may pay without prior regulatory approval. Additionally, Atlantic Capital’s ability to pay dividends to its shareholders will depend on the ability of the Bank to pay dividends to Atlantic Capital. The Bank is subject to regulatory restrictions on the payment of cash dividends, which generally may be paid only from current earnings.

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NOTE 11 – DERIVATIVES AND HEDGING

Risk Management

Atlantic Capital’s objectives in using interest rate derivatives are to add stability to net interest revenue and to manage its exposure to interest rate movements. To accomplish these objectives, Atlantic Capital primarily uses interest rate swaps as part of its interest rate risk management strategy.

Cash Flow Hedges

At March 31, 2018 , Atlantic Capital’s interest rate swaps designated as cash flow hedges involve the payment of floating-rate amounts to a counterparty in exchange for receiving fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. At March 31, 2018 and December 31, 2017 , Atlantic Capital had interest rate swaps designated as cash flow hedges with aggregate notional amounts of $100.0 million , respectively.

No hedge ineffectiveness gains or losses were recognized on active cash flow hedges for the three months ended March 31, 2018 and 2017 . The effective portion of changes in the fair value of derivatives designated and that qualify as cash flow hedges is recorded in accumulated other comprehensive income and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. Atlantic Capital expects that approximately $83,000 will be reclassified as a decrease to loan interest income over the next twelve months related to these cash flow hedges.

Customer Swaps

Atlantic Capital also enters into derivative contracts, which consist of interest rate swaps, to facilitate the needs of customers desiring to manage interest rate risk. These swaps are not designated as accounting hedges under ASC 815, Derivatives and Hedging . To economically hedge the interest rate risk associated with offering this product, Atlantic Capital simultaneously enters into derivative contracts with third parties to offset the customer contracts, such that Atlantic Capital minimizes its net risk exposure resulting from such transactions. The derivative contracts are structured such that the notional amounts reduce over time to generally match the expected amortization of the underlying loans. These derivatives are not speculative and arise from a service provided to clients.

Atlantic Capital’s derivative instruments are recorded at fair value in other assets and accrued interest receivable and other liabilities and accrued interest payable in the Consolidated Balance Sheets. The changes in the fair value of the derivative instruments are recognized in other noninterest income in the Consolidated Statements of Income. At March 31, 2018 and December 31, 2017 , Atlantic Capital had interest rate swaps related to this program with an aggregate notional amount of $129.9 million and $142.3 million , respectively.

Atlantic Capital acquired a loan level hedging program, which First Security utilized to accommodate clients preferring a fixed rate loan. The loan documents include an addendum with a zero premium collar. The zero premium collar is a cap and a floor at the same interest rate, resulting in a fixed rate to the borrower. To hedge this embedded option, First Security entered into a dealer facing trade exactly mirroring the terms in the loan addendum.

Counterparty Credit Risk

As a result of its derivative contracts, Atlantic Capital is exposed to credit risk. Specifically approved counterparties and exposure limits are defined. Quarterly, the customer derivative contracts and related counterparties are evaluated for credit risk and an adjustment is made to the contract’s fair value. This adjustment is recognized in the Consolidated Statements of Income.

Most derivative contracts with clients are secured by collateral. Additionally, in accordance with the interest rate agreements with derivatives dealers, Atlantic Capital may be required to post margin to these counterparties. At March 31, 2018 and December 31, 2017 , Atlantic Capital had minimum collateral posting thresholds with certain of its derivative counterparties and posted collateral of $8.3 million and $8.8 million , respectively, against its obligations under these agreements. Cash collateral related to derivative contracts is recorded in other assets in the Consolidated Balance Sheets.

Atlantic Capital has master netting agreements with the derivatives dealers with which it does business, but reflects gross assets and liabilities on the Consolidated Balance Sheets.

In conjunction with the FASB’s fair value measurement guidance, management made an accounting policy election to measure the credit risk of its derivative financial instruments that are subject to master netting arrangements on a net basis.

To accommodate clients, Atlantic Capital occasionally enters into credit risk participation agreements with counterparty banks to accept a portion of the credit risk related to interest rate swaps. This allows clients to execute an interest rate swap with one bank while allowing for distribution of the credit risk among participating members. Credit risk participation agreements arise when Atlantic Capital contracts with other financial institutions, as a guarantor, to share credit risk associated with certain interest rate swaps. These agreements provide for reimbursement of losses resulting from a third party default on the underlying swap. At March 31, 2018 and December 31, 2017 , Atlantic Capital had credit risk participation agreements with a notional amount of $14.1 million and $14.8 million , respectively.

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The following table reflects the estimated fair value positions of derivative contracts and credit risk participation agreements as of March 31, 2018 and December 31, 2017 :



Derivatives designated as hedging instruments under ASC 815

(in thousands)		March 31, 2018				December 31, 2017
Interest Rate Products	Balance Sheet Location	Notional Amount		Fair Value		Notional Amount		Fair Value
Cash flow hedge of LIBOR based loans	Other liabilities	$	100,000	$	2,739	$	100,000	$	887

Derivatives not designated as hedging instruments under ASC 815

(in thousands)		March 31, 2018				December 31, 2017
Interest Rate Products	Balance Sheet Location	Notional Amount		Fair Value		Notional Amount		Fair Value
Customer swap positions	Other assets	$	64,958	$	1,065	$	71,160	$	946
Zero premium collar	Other assets	94,189		1,549		94,953		2,072
		$	159,147	$	2,614	$	166,113	$	3,018

Dealer offsets to customer swap positions	Other liabilities	$	64,958	$	1,061	$	71,160	$	975
Credit risk participation	Other liabilities	14,058		2		14,807		4
Dealer offset to zero premium collar	Other liabilities	94,189		1,558		94,953		2,157
		$	173,205	$	2,621	$	180,920	$	3,136

The following table presents the effect of the Company’s derivative financial instruments that are not designated as hedging instruments on the Consolidated Statements of Income for the three months ended March 31, 2018 and 2017 .



Derivatives not designated as hedging instruments under ASC 815

(in thousands)	Location of Gain or (Loss) Recognized in Income on Derivative	Amount of Gain or (Loss) Recognized in Income on Derivative
		Three Months Ended March 31,
		2018		2017
Interest rate products	Other income / (expense)	$	108	$	(51	)
Other contracts	Other income / (expense)	3		—
Total		$	111	$	(51	)

Fee income	Other income / (expense)	$	3	$	—

The following table reflects the impact to the Consolidated Statements of Income related to derivative contracts for the three months ended March 31, 2018 and 2017 :



Derivatives in Cash Flow Hedging Relationships

	Three Months Ended March 31,
(in thousands)	Amount of Gain or (Loss) Recognized in OCI on Derivatives (Effective Portion)						Gain or (Loss) Reclassified from Accumulated OCI in Income (Effective Portion)
	2018			2017			Location	2018		2017
Interest rate swaps	$	(1,778	)	$	(100	)	Interest income	$	102	$	137

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NOTE 12 – OTHER BORROWINGS AND LONG TERM DEBT

Federal Home Loan Bank borrowings as of March 31, 2018 and December 31, 2017 are as follows:



	March 31, 2018					December 31, 2017
	Balance		Interest Rate			Balance		Interest Rate
	(in thousands)					(in thousands)
FHLB short-term borrowings:					FHLB short-term borrowings:
Fixed rate advance maturing April 3, 2018	40,000		1.61	%	Fixed rate advance maturing January 16, 2018	45,000		1.40	%
Fixed rate advance maturing April 6, 2018	40,000		1.70	%
Fixed rate advance maturing April 12, 2018	30,000		1.70	%
Fixed rate advance maturing April 16, 2018	45,000		1.86	%
Fixed rate advance maturing April 23, 2018	30,000		1.85	%
Total	$	185,000			Total	$	45,000

On September 28, 2015, Atlantic Capital issued subordinated notes (the “Notes”) totaling $50.0 million in aggregate principal amount. The Notes are due September 30, 2025 and bear a fixed rate of interest of 6.25% per year until September 29, 2020. From September 30, 2020 to the maturity date, the interest rate will be a floating rate equal to the three-month LIBOR plus 468 basis points. The Notes were priced at 100% of their par value. The Notes qualify as Tier 2 regulatory capital.

Subordinated debt is summarized as follows.



	March 31, 2018		December 31, 2017
	(in thousands
Floating rate 10 year capital securities, with interest paid semi-annually at an annual fixed rate of 6.25% until September 30, 2020	$	50,000	$	50,000
Principal amount of subordinated debt	$	50,000	$	50,000
Less debt issuance costs		423		465
Subordinated debt, net	$	49,577	$	49,535

All subordinated debt outstanding at March 31, 2018 matures after more than five years.

NOTE 13 – SHARE-BASED COMPENSATION

Atlantic Capital sponsors a stock incentive plan for the benefit of directors and employees. Under the 2015 Stock Incentive Plan, there were approximately 4,525,000 shares reserved for issuance to directors and employees. The Compensation Committee has the authority to grant the following: an incentive or nonqualified option; a restricted stock award (including a restricted stock award or a restricted unit award); a performance award (including a performance share award or a performance unit award); a phantom stock award; a dividend equivalent award; or any other award granted under the plan.

As of March 31, 2018 , approximately 3,660,000 additional awards were available to be granted under the plan. Stock options are granted at a price which is no less than the fair market value of a share of Atlantic Capital common stock on the grant date. Stock options generally vest over three years and expire after ten years.

As of March 31, 2018 and December 31, 2017 , no warrants were outstanding for the purchase of common stock.

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The Company estimates the fair value of its options and warrants awards using the Black-Scholes option pricing model. The risk-free rate for periods within the contractual life of the option and warrant is based on the U.S. Treasury yield curve in effect at the time of grant. There were no options or warrants granted during the three months ended March 31, 2017. The table below summarizes the assumptions used to calculate the fair value of options granted/modified during the three months ended March 31, 2018:



	2018
Risk‑free interest rate	1.66	%
Expected term in years	0.25
Expected stock price volatility	24.2	%
Dividend yield	—	%

The following table represents stock option activity for the three months ended March 31, 2018 :



	Shares		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value
Outstanding, December 31, 2017	757,711		$	12.66
Granted	15,000		14.64
Exercised	(25,376	)	12.80
Forfeited	(15,000	)	14.64
Expired	(118	)	482.97
Outstanding, March 31, 2018	732,217		$	12.58	5.31	$	4,127

Exercisable, March 31, 2018	645,522		$	12.32	5.02	$	3,813

Atlantic Capital recognized compensation expense relating to stock options of $58,000 and $142,000 for the three months ended March 31, 2018 and 2017, respectively. Using the Black-Scholes pricing model, the amount of compensation expense was determined based on the fair value of the options at the time of grant, multiplied by the number of options granted that were expected to vest, which was then amortized over the vesting period.

The following table represents restricted stock activity for the three months ended March 31, 2018 :



	Shares		Weighted Average Grant-Date Fair Value
Outstanding, December 31, 2017	239,468		$	15.69
Granted	19,882		12.61
Vested	(8,769	)	4.93
Forfeited	(21,905	)	15.94
Outstanding, March 31, 2018	228,676		$	15.81

Compensation expense for restricted stock is based on the fair value of restricted stock awards at the time of grant, which is equal to the value of Atlantic Capital’s common stock on the date of grant. The value of restricted stock grants that are expected to vest is amortized into expense over the vesting period. For the three months ended March 31, 2018 and 2017, compensation expense of $401,000 and $229,000 , respectively, was recognized related to restricted stock awards.

As of March 31, 2018 , there was $ 2.2 million of unrecognized compensation cost related to restricted stock awards granted under the plan. That cost is expected to be recognized over a weighted-average period of 2.83 years.

During the three months ended March 31, 2018, the Company modified options for 15,000 shares and 6,869 restricted stock awards to two individuals. The modifications allowed for the immediate vesting of the awards upon termination of service. The total incremental cost resulting from the modifications was $111,000 for the three months ended March 31, 2018.

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NOTE 14 – FAIR VALUE MEASUREMENTS

Atlantic Capital follows the guidance pursuant to ASC 820-10, Fair Value Measurements and Disclosures . This guidance defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. This issuance applies to reported balances that are required or permitted to be measured at fair value under existing accounting pronouncements; accordingly, the standard does not require any new fair value measurements of reported balances. Atlantic Capital measures its investment securities and interest rate derivative assets and liabilities at fair value on a recurring basis. Fair value is used on a nonrecurring basis either when assets are evaluated for impairment or for disclosure purposes. Atlantic Capital measures its servicing assets, goodwill, intangible assets, loans held for sale, impaired loans and other real estate owned at fair value on a nonrecurring basis if necessary.

The guidance emphasizes that fair value is a market-based measurement, not an entity-specific measurement and defines fair value as the price that could be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As a basis for considering market participant assumptions in fair value measurements, this guidance establishes a fair value hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the reporting entity (observable inputs that are classified within Levels 1 and 2 of the hierarchy) and the reporting entity’s own assumptions about market participant assumptions (unobservable inputs classified within Level 3 of the hierarchy).

Atlantic Capital applied the following fair value hierarchy:

Level 1 – Assets or liabilities for which the identical item is traded on an active exchange, such as publicly-traded instruments or futures contracts.

Level 2 – Assets or liabilities valued based on observable market data for similar instruments.

Level 3 – Assets or liabilities for which significant valuation assumptions are not readily observable in the market, instruments valued based on the best available data, some of which is internally-developed, and risk premiums that a market participant would require.

In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement. There were no transfers between Level 1 and Level 2 or Level 2 and Level 3 during the three months ended March 31, 2018 and 2017.

Atlantic Capital records investment securities available-for-sale at fair value on a recurring basis. Investment securities classified as available-for-sale are reported at fair value utilizing Level 2 inputs. For these securities, Atlantic Capital obtains fair value measurements from an independent pricing service. In estimating the fair values for investment securities, Atlantic Capital believes that independent third-party market prices are the best evidence of an exit price. The fair value measurements consider observable data that may include dealer quotes, market spreads, cash flows, the Treasury Department yield curve, trade execution data, market consensus prepayment speeds, credit information and the securities’ terms and conditions, among other things.

Derivative instruments are primarily transacted as over-the-counter trades and priced with observable market assumptions. Ongoing measurements include observable market assumptions with appropriate valuation adjustments for liquidity and for credit risk of counterparties and Atlantic Capital’s own credit. For these instruments, Atlantic Capital obtains fair value measurements from an independent pricing service. The fair value measurements consider factors such as the likelihood of default by Atlantic Capital and its counterparties, total exposure and remaining maturities in determining the appropriate fair value adjustments to record. Generally, the expected loss of each client counterparty is estimated using Atlantic Capital’s internal risk rating system. For financial institution counterparties that are rated by national rating agencies, those ratings are used in determining the credit risk. This approach used to estimate exposures to counterparties is also used by Atlantic Capital to estimate its own credit risk on derivative liability positions.

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Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following table presents the assets that were measured at fair value on a recurring basis by level within the fair value hierarchy as reported in the Consolidated Balance Sheets at March 31, 2018 and December 31, 2017 .



	Fair Value Measurements at
	March 31, 2018 Using:
	Quoted Prices in Active Markets for Identical Securities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	(in thousands)
Securities available-for-sale—
U.S. government agencies	$	—	$	36,532	$	—	$	36,532
U.S. states and political subdivisions	—		85,813		—		85,813
Trust preferred securities	—		4,650		—		4,650
Corporate debt securities	—		12,457		—		12,457
Mortgage-backed securities	—		319,278		—		319,278
Total securities available-for-sale	$	—	$	458,730	$	—	$	458,730
Interest rate derivative assets	$	—	$	2,614	$	—	$	2,614
Interest rate derivative liabilities	$	—	$	5,360	$	—	$	5,360



	Fair Value Measurements at
	December 31, 2017 Using:
	Quoted Prices in Active Markets for Identical Securities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	(in thousands)
Securities available-for-sale—
U.S. government agencies	$	—	$	34,111	$	—	$	34,111
U.S. states and political subdivisions	—		90,001		—		90,001
Trust preferred securities	—		4,650		—		4,650
Corporate debt securities	—		12,622		—		12,622
Mortgage-backed securities	—		307,733		—		307,733
Total securities available-for-sale	$	—	$	449,117	$	—	$	449,117
Interest rate derivative assets	$	—	$	3,018	$	—	$	3,018
Interest rate derivative liabilities	$	—	$	4,023	$	—	$	4,023

For the three months ended March 31, 2018 and 2017 , there was not a change in the methods and significant assumptions used to estimate fair value.

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Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis

The following table presents the assets that were measured at fair value on a nonrecurring basis by level within the fair value hierarchy as reported in the Consolidated Balance Sheets at March 31, 2018 and December 31, 2017 .



March 31, 2018		Level 1 Fair Value Measurement		Level 2 Fair Value Measurement		Level 3 Fair Value Measurement		Total
	(in thousands)
Impaired Loans		$	—	$	—	$	2,142	$	2,142



December 31, 2017		Level 1 Fair Value Measurement		Level 2 Fair Value Measurement		Level 3 Fair Value Measurement		Total
	(in thousands)
Impaired Loans		$	—	$	—	$	2,199	$	2,199

Level 3 loans consist of impaired loans which have been partially charged-off or have specific valuation allowances. The fair value of Level 3 assets is estimated based on the underlying collateral value. For loans which the cash proceeds from the sale of the underlying collateral is the expected source of repayment, the fair value of these loans was derived from internal estimates of the underlying collateral incorporating market data, including third party appraisals or evaluations, when available. Appraised values may be discounted based on management’s assessment of the level of inactivity in the real estate market and other markets for the underlying collateral, changes in market conditions from the time of the valuation, and other information that in management’s judgment may affect the value. Impaired loans are evaluated on at least a quarterly basis and adjusted accordingly.

Assets and Liabilities Not Measured at Fair Value

For financial instruments that have quoted market prices, those quotes are used to determine fair value. Financial instruments that have no defined maturity, have a remaining maturity of 180 days or less, or reprice frequently to a market rate, are assumed to have a fair value that approximates the reported book value, after taking into consideration any applicable credit risk. If no market quotes are available, financial instruments are valued by discounting the expected cash flows using an estimated current market interest rate for the financial instrument. For loans held for investment, fair value is measured using the exit price notion. For off-balance sheet derivative instruments, fair value is estimated as the amount that Atlantic Capital would receive or pay to terminate the contracts at the reporting date, taking into account the current unrealized gains or losses on open contracts.

The short maturity of Atlantic Capital’s assets and liabilities results in having a significant number of financial instruments whose fair value equals or closely approximates carrying value. Such financial instruments are reported in the following balance sheet captions: cash and due from banks, interest-bearing deposits in other banks, other short-term investments, and FHLB stock. The fair value of securities available-for-sale equals the balance sheet value. Due to the short-term settlement of accrued interest receivable and payable, the carrying amount closely approximates fair value.

Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial instrument. These estimates do not reflect the premium or discount on any particular financial instrument that could result from the sale of Atlantic Capital’s entire holdings. Because no ready market exists for a significant portion of Atlantic Capital’s financial instruments, fair value estimates are based on many judgments. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

Off-balance sheet financial instruments (commitments to extend credit and standby letters of credit) are generally short-term and at variable rates. Therefore, both the carrying amount and the estimated fair value associated with these instruments are immaterial.

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The following table presents the estimated fair values of Atlantic Capital’s financial instruments at March 31, 2018 and December 31, 2017 .



	Fair Value Measurements at
	March 31, 2018 Using:
	Carrying Value		Quoted Prices in Active markets for Identical Securities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	(in thousands)
Financial assets
Cash and due from banks	$	39,985	$	39,985	$	—	$	—
Interest bearing deposits in banks	62,787		62,787		—		—
Other short-term investments	9,669		9,669		—		—
Total securities available-for-sale	458,730		—		458,730		—
FHLB stock	10,485		—		—		10,485
Federal Reserve Bank stock	9,792		—		—		9,792
Loans held for investment, net	1,939,536		—		—		1,893,372
Loans held for sale	835		—		835		—
Derivative assets	2,614		—		2,614		—
Financial liabilities
Deposits	$	2,096,300	$	—	$	2,037,010	$	—
Federal funds purchased and securities sold under agreements to repurchase	47,855		47,855		—		—
Subordinated debt	49,577		—		48,823		—
FHLB advances	185,000		—		185,276		—
Derivative financial instruments	5,360		—		5,360		—



	Fair Value Measurements at
	December 31, 2017 Using:
	Carrying Value		Quoted Prices in Active markets for Identical Securities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
	(in thousands)
Financial assets
Cash and due from banks	$	38,086	$	38,086	$	—	$	—
Interest-bearing deposits in other banks	281,247		281,247		—		—
Other short-term investments	10,681		10,681		—		—
Total securities available-for-sale	449,117		—		449,117		—
FHLB stock	4,388		—		—		4,388
Federal Reserve Bank stock	9,792		—		—		9,792
Loans held for investment, net	1,914,495		—		—		1,955,705
Loans held for sale	1,487		—		1,487		—
Derivative assets	3,018		—		3,018		—
Financial liabilities
Deposits	$	2,450,665	$	—	$	2,411,810	$	—
Subordinated debt	49,535		—		49,888		—
FHLB advances	45,000		—		45,057		—
Derivative financial instruments	4,023		—		4,023		—

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NOTE 15 – COMMITMENTS AND CONTINGENCIES

Atlantic Capital is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit and letters of credit, most of which are standby letters of credit. These instruments involve, to varying degrees, elements of credit risk in excess of the amounts recognized in the Consolidated Balance Sheets. The contract amounts of these instruments reflect the extent of involvement Atlantic Capital has in particular classes of financial instruments.

Standby letters of credit are written conditional commitments issued by Atlantic Capital to guarantee the performance of a customer to a third party. Those guarantees are primarily issued to support public and private borrowing arrangements. Most letters of credit expire in less than one year. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers.

Atlantic Capital’s exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit and standby letters of credit is represented by the contractual amount of those instruments. Atlantic Capital uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments.

Atlantic Capital’s maximum exposure to credit risk for unfunded loan commitments and standby letters of credit at March 31, 2018 and December 31, 2017 was as follows:



	March 31, 2018		December 31, 2017
	(in thousands)
Financial Instruments whose contract amount represents credit risk:
Commitments to extend credit	$	688,312	$	689,753
Standby letters of credit	13,560		10,958
	$	701,872	$	700,711

Atlantic Capital, in the normal course of business, is subject to various pending and threatened lawsuits in which claims for monetary damages are asserted. Although it is not possible to predict the outcome of these lawsuits, or the range of any possible loss, management, after consultation with legal counsel, does not anticipate that the ultimate aggregate liability, if any, arising from these lawsuits will have a material adverse effect on Atlantic Capital’s financial position or results of operations.

NOTE 16 – REVENUE RECOGNITION

On January 1, 2018, the Company adopted ASU No. 2014-09 “Revenue from Contracts with Customers” (Topic 606) and all subsequent ASUs that modified Topic 606. As stated in Note 2, Accounting Standards Updates and Recently Adopted Standards , the implementation of the new standard did not result in any significant changes to the Company’s methodology of recognizing revenue; as such, the Company recorded a cumulative effect adjustment to first quarter 2018 opening retained earnings in an amount less than $2,000 . Results for reporting periods beginning after January 1, 2018 are presented under Topic 606, while prior period amounts were not adjusted and continue to be reported in accordance with the Company’s historic accounting under Topic 605.

Topic 606 does not apply to revenue associated with financial instruments, including revenue from loans and securities. In addition, certain noninterest income streams such as fees associated with financial guarantees and derivatives are also not in scope of the new guidance. Topic 606 is applicable to noninterest revenue streams such as service charges on deposit accounts and trust and asset management income. However, the recognition of these revenue streams did not change significantly upon adoption of Topic 606. Substantially all of the Company’s revenue is generated from contracts with customers. Noninterest revenue streams within the scope of Topic 606 are discussed below.

Service Charges on Deposit Accounts

Service charges represent general service fees for monthly account maintenance and activity, or transaction-based fees and consist of transaction-based revenue, time-based revenue (service period), item-based revenue or some other individual attribute-based revenue. Revenue is recognized when the performance obligation is completed which is generally monthly for account maintenance services or when a transaction has been completed, such as a wire transfer or ATM withdrawal. Payment for such performance obligations are generally received at the time the performance obligations are satisfied. The following table presents service charges by type of service provided for the three months ended March 31, 2018 and 2017:

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	For the three months ended March 31,
	2018		2017
	(in thousands)
Deposit account analysis fees and charges	$	571	$	499
ATM fees	290		407
NSF fees	193		248
Wire fees	90		91
Foreign Exchange Fees	38		84
Other	10		20
	$	1,192	$	1,349

Trust and Asset Management

Trust and asset management income is primarily comprised of fees earned from the management and administration of trusts and other customer assets. The Company’s performance obligation is generally satisfied over time and the resulting fees are recognized monthly, based upon the month-end market value of the assets under management and the applicable fee rate. Payment is generally received a few days after month end through a direct charge to customers’ accounts. The Company’s performance obligation for these transactional-based services is generally satisfied, and related revenue recognized, at a point in time (i.e., as incurred). Payment is received shortly after services are rendered. The following table presents trust income by type of service provided for the three months ended March 31, 2018 and 2017:



	For the three months ended March 31,
	2018		2017
	(in thousands)
Personal trust and agency accounts	$	313	$	232
Employee benefit and retirement-related trust and agency accounts	60		52
Investment management and investment advisory agency accounts	107		88
Custody and safekeeping accounts	13		18
Other	25		17
	$	518	$	407

Other

Other noninterest income consists of other recurring revenue streams such as check printing income, safety deposit box rental fees, and other miscellaneous revenue streams. Check printing income is recognized ratably over the contract period as the Company satisfies its performance obligation to sell a specific number of check packages. Safe deposit box rental fees are charged to the customer annually and recognized upon receipt of payment. The Company determined that since rentals and renewals occur fairly consistently over time, revenue is recognized on a basis consistent with the duration of the performance obligation.

Contract Balances

A contract asset balance occurs when an entity performs a service for a customer before the customer pays consideration (resulting in a contract receivable) or before payment is due (resulting in a contract asset). A contract liability balance is an entity’s obligation to transfer a service to a customer for which the entity has already received payment (or payment is due) from the customer. The Company’s noninterest revenue streams are largely based on transactional activity, or standard month-end revenue accruals such as asset management fees based on month-end market values. Consideration is often received immediately or shortly after the Company satisfies its performance obligation and revenue is recognized. The Company does not typically enter into long-term revenue contracts with customers, and therefore, does not experience significant contract balances. As of March 31, 2018 and December 31, 2017, the Company did not have any significant contract balances.

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ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q of Atlantic Capital Bancshares, Inc. (the “Company” or “Atlantic Capital”) contains forward-looking statements within the meaning of section 27A of the Securities Act of 1933, as amended, and 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “projection,” “would,” and “outlook,” or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates, and projections about our industry, management’s beliefs, and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, and uncertainties that are difficult to predict. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements.

The following risks, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statements:


•	changes in our business strategy implemented following the integration with First Security Group, Inc. (“First Security”) may result in the expected benefits of the acquisition not being fully realized;


•	costs associated with, and fluctuations in income resulting from, strategic decisions with respect to particular markets, locations or lines of business;


•	loss of income from out trust business following our exit of this business;


•	changes in asset quality and credit risk;


•	the cost and availability of capital;


•	customer acceptance of our products and services;


•	customer borrowing, repayment, investment and deposit practices;


•	the introduction, withdrawal, success and timing of business initiatives;


•	the impact, extent, and timing of technological changes;


•	severe catastrophic events in our geographic area;


•	a weakening of the economies in which we conduct operations may adversely affect our operating results;


•	the U.S. legal and regulatory framework, including those associated with the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), could adversely affect the operating results of the company;


•	an increasing interest rate environment may compress margins and adversely affect net interest income;


•	changes in trade, monetary and fiscal policies of various governmental bodies and central banks could affect the economic environment in which we operate;


•	our ability to determine accurate values of certain assets and liabilities;


•	adverse developments in securities, public debt, and capital markets, including changes in market liquidity and volatility;


•	our ability to anticipate or respond to interest rate changes correctly and manage interest rate risk presented through unanticipated changes in our interest rate risk position and/or short- and long-term interest rates;


•	unanticipated changes in our liquidity position, including but not limited to our ability to enter the financial markets to manage and respond to any changes to our liquidity position;


•	adequacy of our risk management program;


•	increased costs associated with operating as a public company;


•	increased competitive pressure due to consolidation in the financial services industry;

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•	risks related to security breaches, cybersecurity attacks and other significant disruptions in our information technology systems, including attacks focused on the financial industry, may result in costs and liabilities related to compromised personal information of our customers;


•	the effect of changes in tax law, such as the effect of the Tax Cuts and Jobs Act that was enacted on December 22, 2017; or


•	other risks and factors identified in our Annual Report on Form 10-K as filed with the Securities and Exchange Commission on March 15, 2018 (the “Annual Report”) in Part I, Item 1A under the heading “Risk Factors.”

CRITICAL ACCOUNTING POLICIES

The accounting and reporting policies of Atlantic Capital are in accordance with GAAP and conform to general practices within the banking industry. Atlantic Capital’s financial position and results of operations are affected by management’s application of accounting policies, including judgments made to arrive at the carrying value of assets and liabilities and amounts reported for revenues, expenses and related disclosures. Different assumptions in the application of these policies could result in material changes in Atlantic Capital’s consolidated financial position and/or consolidated results of operations. The more critical accounting and reporting policies include Atlantic Capital’s accounting for the allowance for loan losses, fair value measurements, and income tax related items. Significant accounting policies are discussed in the Notes to Consolidated Financial Statements within Atlantic Capital’s Annual Report on Form 10-K.

Non-GAAP Financial Measures.

This Form 10-Q contains non-GAAP financial measures and should be read along with the accompanying tables, which provide a reconciliation of non-GAAP financial measures to GAAP financial measures. Atlantic Capital management uses non-GAAP financial measures, including: (i) taxable equivalent interest income; (ii) taxable equivalent net interest income; (iii) taxable equivalent net interest margin; (iv) net interest income after provision for loan losses-taxable equivalent; (v) income before income taxes-taxable equivalent; and (vi) income tax expense-taxable equivalent. Management uses these non-GAAP financial measures because it believes they provide a greater understanding of ongoing performance and operations, enhance comparability with prior periods, and provide users of our financial information with a meaningful measure for assessing our financial results and credit trends. Non-GAAP financial measures have limitations as analytical tools, and investors should not consider them in isolation or as an alternative to any measure of performance or financial condition as determined in accordance with GAAP. In addition, non-GAAP financial measures may not be comparable to similarly titled non-GAAP financial measures presented by other companies. Investors should consider Atlantic Capital’s performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. A reconciliation of these non-GAAP financial measures to GAAP financial measures is included in Table 1.

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EXECUTIVE OVERVIEW AND EARNINGS SUMMARY

Atlantic Capital reported net income of $5.0 million for the first quarter of 2018 compared to net income of $3.2 million for the first quarter of 2017. Diluted income per common share was $.19 for the first quarter of 2018 compared to diluted income per common share of $.13 for the first quarter of 2017.

The increase in net income for the three months ended March 31, 2018, compared to the same period in 2017, was primarily the result of a $2.1 million, or 11%, increase in taxable equivalent net interest income after provision for loan losses, offset by a $648,000, or 4%, increase in noninterest expense.

Taxable equivalent net interest income was $21.6 million for the first quarter of 2018, compared to $19.5 million for the first quarter of 2017. Taxable equivalent net interest margin increased to 3.51% for the three months ended March 31, 2018 from 3.20% for the three months ended March 31, 2017. The margin increase for the three months ended March 31, 2018 compared to the prior year was due to increases in the Fed Funds rate.

Provision for loan losses for the quarter ended March 31, 2018 totaled $772,000, an increase of $138,000 from the quarter ended March 31, 2017. The higher provision for the three months ended March 31, 2018 was primarily related to loan growth.

Noninterest income increased $126,000, or 3%, to $4.0 million from the first quarter of 2017. The increase was primarily due to a $165,000, or 324%, increase in derivatives income which was attributable to the quarterly credit valuation adjustment.

The closing on the sale of Southeastern Trust Company is expected to occur in the second quarter of 2018 and result in a gain of approximately $1.7 million. Quarterly expense savings are expected to be approximately $450,000 to $500,000, but will be offset by an expected decrease in quarterly trust income of approximately $518,000 based on first quarter 2018 results.

For the first quarter of 2018, noninterest expense increased $648,000, or 4%, to $18.4 million compared to the first quarter of 2017. The most significant component of the increase was salaries and employee benefits due to severance expense.

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Table 1 - Quarterly Selected Financial Data
(dollars in thousands, except share and per share data; taxable equivalent)

	2018			2017
	First Quarter			Fourth Quarter				Third Quarter			Second Quarter			First Quarter
INCOME SUMMARY
Interest income	$	26,085		$	25,350			$	24,566		$	24,545		$	22,716
Interest expense	4,465			4,028				4,060			3,833			3,208
Net interest income	21,620			21,322				20,506			20,712			19,508
Provision for loan losses	772			282				322			1,980			634
Net interest income after provision for loan losses	20,848			21,040				20,184			18,732			18,874
Noninterest income	3,983			3,568				3,477			5,287			3,857
Noninterest expense	18,392			20,594				17,504			17,623			17,744
Income before income taxes	6,439			4,014				6,157			6,396			4,987
Income tax expense	1,401			19,351				2,105			2,067			1,757
Net income (loss)	$	5,038		$	(15,337	)		$	4,052		$	4,329		$	3,230

PER SHARE DATA
Basic earnings per share	$	0.20		$	(0.60	)		$	0.16		$	0.17		$	0.13
Diluted earnings per share	0.19			(0.60		)		0.16			0.17			0.13

PERFORMANCE MEASURES
Return on average equity	6.66		%	(18.66		)	%	4.96		%	5.48		%	4.19		%
Return on average assets	0.76			(2.24		)		0.60			0.63			0.48
Taxable equivalent net interest margin	3.51			3.39				3.26			3.26			3.20
Efficiency ratio	72.13			83.45				73.65			68.37			76.78
Equity to assets	11.29			10.67				12.31			11.82			11.10

ASSET QUALITY
Allowance for loan losses to loans	1.01		%	1.00			%	0.99		%	1.11		%	1.05		%
Net charge-offs	$	231		$	(192	)		$	3,322		$	49		$	1,290
Net charge-offs to average loans ⁽¹⁾	0.05		%	(0.04		)	%	0.68		%	0.01		%	0.26		%
NPAs to total assets	0.13			0.14				0.23			0.52			0.21

AVERAGE BALANCES
Total loans	$	1,938,953		$	1,898,745			$	1,934,505		$	1,962,374		$	1,949,385
Investment securities	453,917			460,269				455,868			455,090			419,335
Total assets	2,704,822			2,720,070				2,701,387			2,762,389			2,694,715
Deposits	2,153,885			2,194,849				2,121,263			2,158,675			2,111,992
Shareholders’ equity	306,821			326,059				323,832			316,825			308,261
Number of common shares - basic	25,750,824			25,723,548				25,699,179			25,621,910			25,320,690
Number of common shares - diluted	25,945,773			25,888,064				25,890,779			25,831,281			25,672,286

AT PERIOD END
Total loans	$	1,960,256		$	1,935,326			$	1,908,706		$	1,963,835		$	1,930,965
Investment securities	458,730			449,117				447,005			450,273			456,942
Total assets	2,718,665			2,891,421				2,638,412			2,702,575			2,802,078
Deposits	2,096,300			2,450,665				2,103,645			2,113,954			2,203,039
Shareholders’ equity	307,059			308,425				324,754			319,435			310,967
Number of common shares outstanding	25,772,208			25,712,909				25,716,418			25,654,521			25,535,013

⁽¹⁾ Annualized.

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Non-GAAP Performance Measures Reconciliation
(dollars in thousands)
	2018			2017
	First Quarter			Fourth Quarter			Third Quarter			Second Quarter			First Quarter
Taxable equivalent interest income reconciliation
Interest income - GAAP	$	25,982		$	25,137		$	24,351		$	24,322		$	22,461
Taxable equivalent adjustment	103			213			215			223			255
Interest income - taxable equivalent	$	26,085		$	25,350		$	24,566		$	24,545		$	22,716

Taxable equivalent net interest income reconciliation
Net interest income - GAAP	$	21,517		$	21,109		$	20,291		$	20,489		$	19,253
Taxable equivalent adjustment	103			213			215			223			255
Net interest income - taxable equivalent	$	21,620		$	21,322		$	20,506		$	20,712		$	19,508

Taxable equivalent net interest income after provision for loan losses reconciliation
Net interest income after provision for loan losses - GAAP	$	20,745		$	20,827		$	19,969		$	18,509		$	18,619
Taxable equivalent adjustment	103			213			215			223			255
Net interest income after provision for loan losses - taxable equivalent	$	20,848		$	21,040		$	20,184		$	18,732		$	18,874

Taxable equivalent income before income taxes reconciliation
Income before income taxes - GAAP	$	6,336		$	3,801		$	5,942		$	6,173		$	4,732
Taxable equivalent adjustment	103			213			215			223			255
Income before income taxes - taxable equivalent	$	6,439		$	4,014		$	6,157		$	6,396		$	4,987

Taxable equivalent income tax expense reconciliation
Income tax expense - GAAP	$	1,298		$	19,138		$	1,890		$	1,844		$	1,502
Taxable equivalent adjustment	103			213			215			223			255
Income tax expense - taxable equivalent	$	1,401		$	19,351		$	2,105		$	2,067		$	1,757

Taxable equivalent net interest margin reconciliation
Net interest margin - GAAP	3.49		%	3.35		%	3.23		%	3.23		%	3.16		%
Impact of taxable equivalent adjustment	0.02			0.04			0.03			0.03			0.04
Net interest margin - taxable equivalent	3.51		%	3.39		%	3.26		%	3.26		%	3.20		%

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RESULTS OF OPERATIONS

Net Interest Income and Net Interest Margin

Taxable equivalent net interest income for the first quarter of 2018 totaled $21.6 million, a $2.1 million, or 11%, increase compared to the first quarter of 2017. This increase was primarily driven by a $3.4 million, or 15%, increase in taxable equivalent interest income. The change in taxable equivalent interest income primarily resulted from the following:


•	a $2.7 million, or 13%, increase in interest income on loans, resulting from increases in the Fed Funds rate; and


•	a $422,000, or 19%, increase to $2.7 million in taxable equivalent interest income on investment securities, resulting from a $34.6 million, or 8%, increase in average balance, as well as a 46 basis point increase in the yield on taxable investments.

Interest expense for the three months ended March 31, 2018 totaled $4.5 million, a $1.3 million, or 39%, increase from the same period of 2017. The rate paid on interest bearing liabilities increased 30 basis points from the first quarter of 2017 to the first quarter of 2018, driven by an increase in interest rates on deposits and other borrowings. Average interest-bearing deposits were lower mainly due to the branch sale in the second quarter of 2017 and a reduction in brokered deposits. In addition, premium amortization of acquired time deposits reduced interest expense during the first quarter of 2018 in the amount of $65,000, compared to $119,000 in the first quarter of 2017.

Taxable equivalent net interest margin increased to 3.51% for the three months ended March 31, 2018 compared to 3.20% for the three months ended March 31, 2017. The primary reason for the increase in taxable equivalent net interest margin was higher interest rates on loans resulting from Fed Funds rate increases.

The following table presents information regarding average balances for assets and liabilities, the total dollar amounts of interest income and dividends from average interest-earning assets, the total dollar amounts of interest expense on average interest-bearing liabilities, and the resulting average yields and costs. The yields and costs for the periods indicated are derived by dividing the income or expense by the average balances for assets or liabilities, respectively, for the periods presented. Loan fees are included in interest income on loans.

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Table 2 - Average Balance Sheets and Net Interest Analysis
(dollars in thousands; taxable equivalent)
	Three months ended March 31,
	2018						2017
	Average Balance		Interest Income/Expense		Tax Equivalent Yield/Rate		Average Balance		Interest Income/Expense		Tax Equivalent Yield/Rate
Assets
Interest bearing deposits in other banks	$	78,207	$	397	2.06	%	$	72,494	$	165	0.92	%
Other short-term investments	10,346		63		2.47		11,052		47		1.72
Investment securities:
Taxable investment securities	375,771		2,116		2.28		339,614		1,523		1.82
Non-taxable investment securities ⁽¹⁾	78,146		579		3.00		79,721		750		3.82
Total investment securities	453,917		2,695		2.41		419,335		2,273		2.20
Total loans	1,938,953		22,675		4.74		1,949,385		19,994		4.16
FHLB and FRB stock	17,895		255		5.78		19,608		237		4.90
Total interest-earning assets	2,499,318		26,085		4.23		2,471,874		22,716		3.73
Non-earning assets	205,504						222,841
Total assets	$	2,704,822					$	2,694,715
Liabilities
Interest bearing deposits:
NOW, money market, and savings	1,257,580		2,251		0.73		1,137,088		1,315		0.47
Time deposits	139,788		314		0.91		163,021		272		0.68
Brokered deposits	117,787		479		1.65		191,558		460		0.97
Total interest-bearing deposits	1,515,155		3,044		0.81		1,491,667		2,047		0.56
Other borrowings	156,822		592		1.53		194,478		338		0.70
Long-term debt	49,550		829		6.79		49,381		823		6.76
Total interest-bearing liabilities	1,721,527		4,465		1.05		1,735,526		3,208		0.75
Demand deposits	638,730						620,325
Other liabilities	37,744						30,603
Shareholders’ equity	306,821						308,261
Total liabilities and shareholders’ equity	$	2,704,822					$	2,694,715
Net interest spread					3.18	%					2.98	%
Net interest income and net interest margin (taxable equivalent) ⁽²⁾			$	21,620	3.51	%			$	19,508	3.20	%

⁽¹⁾ Interest revenue on tax-exempt securities has been increased to reflect comparable interest on taxable securities. The rate used was 21% for the three months ended March 31, 2018 and 35% for the three months ended March 31, 2017, reflecting the statutory federal income tax rates.
⁽²⁾ Taxable equivalent net interest income divided by total interest-earning assets using the appropriate day count convention based on the type of interest-earning asset.

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The following table shows the relative effect on taxable equivalent net interest income for changes in the average outstanding amounts (volume) of interest-earning assets and interest-bearing liabilities and the rates earned and paid on such assets and liabilities (rate). Variances resulting from a combination of changes in rate and volume are allocated in proportion to the absolute dollar amounts of the change in each category .



Table 3 - Changes in Taxable Equivalent Net Interest Income
(dollars in thousands)
	Three Months Ended March 31, 2018 Compared to 2017 Increase (decrease) Due to Changes in:
	Volume			Yield/Rate			Total Change
Interest earning assets
Interest bearing deposits in other banks	$	29		$	203		$	232
Other short-term investments	(4		)	20			16
Investment securities:
Taxable investment securities	204			389			593
Non-taxable investment securities	(12		)	(159		)	(171		)
Total investment securities	192			230			422
Total loans	(122		)	2,803			2,681
FHLB and FRB stock	(24		)	42			18
Total interest-earning assets	71			3,298			3,369
Interest bearing liabilities
Interest bearing deposits:
NOW, money market, and savings	216			720			936
Time deposits	(52		)	94			42
Brokered deposits	(300		)	319			19
Total interest-bearing deposits	(136		)	1,133			997
Total borrowings	(142		)	396			254
Total long-term debt	3			3			6
Total interest-bearing liabilities	(275		)	1,532			1,257
Change in net interest income	$	346		$	1,766		$	2,112

Provision for Loan Losses

Management considers a number of factors in determining the required level of the allowance for loan losses and the provision required to achieve what is believed to be appropriate reserve level, including historical loss experience, loan growth, credit risk rating trends, nonperforming loan levels, delinquencies, loan portfolio concentrations and economic and market trends. The provision for loan losses represents management’s determination of the amount necessary to be charged against the current period’s earnings to maintain the allowance for loan losses at a level that it considered adequate in relation to the estimated losses inherent in the loan portfolio.

For the three months ended March 31, 2018, the provision for loan losses was $772,000, an increase of $138,000, or 22%, compared to the three months ended March 31, 2017. The higher provision for the three months ended March 31, 2018 was primarily related to higher balances subject to the general reserve. At March 31, 2018, nonperforming loans totaled $2.5 million compared to $4.0 million at March 31, 2017. Net loan charge-offs were 0.05% of average loans (annualized) for the three months ended March 31, 2018 compared to 0.26% for the three months ended March 31, 2017. The allowance for loan losses to total loans at March 31, 2018 was 1.01%, compared to 1.05% at March 31, 2017.

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Noninterest Income

Noninterest income for the three months ended March 31, 2018 was $4.0 million, a decrease of $126,000, or 3%, compared to the first quarter of 2017. The following table presents the components of noninterest income.



Table 4 - Noninterest Income
(dollars in thousands)
	Three months ended March 31,						Change
	2018			2017			$			%
Service charges	$	1,192		$	1,349		$	(157	)	(12	)	%
Gain (loss) on sales of other assets	(46		)	78			(124		)	(159	)
Mortgage income	304			257			47			18
Trust income	518			407			111			27
Derivatives income (loss)	114			(51		)	165			324
Bank owned life insurance	369			378			(9		)	(2	)
SBA lending activities	1,302			1,227			75			6
Other noninterest income	230			212			18			8
Total noninterest income	$	3,983		$	3,857		$	126		3		%

Service charges for the three months ended March 31, 2018 decreased $157,000, or 12%, from the same period in 2017. The decrease was primarily due to the divestiture of the Cleveland branch in the second quarter of 2017 and lower foreign exchange fees.

Gain on sales of other assets for the three months ended March 31, 2018 decreased $124,000, or 159%, from the same period in 2017 due to $78,000 in net gains on sales of other real estate owned in the first quarter of 2017 and a loss on disposition of fixed assets totaling $46,000 in the first quarter of 2018. Trust income for the three months ended March 31, 2018 increased $111,000, or 27%, from the same period in 2017 due to an increase in managed assets. The Bank entered into an agreement to sell Southeastern Trust Company, which is expected to close in the second quarter of 2018. Derivative income for the first quarter of 2018 increased $165,000, or 324%, from the same period in 2017 due to the quarterly credit valuation adjustment.

Income from SBA lending activities for the first quarter of 2018 increased $75,000, or 6%, from the same period in 2017, due to a higher level of loan sales. During the three months ended March 31, 2018 and 2017, guaranteed portions of 17 and 11 SBA loans totaling $17.7 million and $14.6 million, respectively, were sold in the secondary market.

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Noninterest Expense

The following table presents the components of noninterest expense.



Table 5 - Noninterest Expense
(dollars in thousands)
	Three months ended March 31,				Change
	2018		2017		$			%
Salaries and employee benefits	$	12,077	$	11,065	$	1,012		9		%
Occupancy	1,355		1,230		125			10
Equipment and software	787		805		(18		)	(2	)
Professional services	832		904		(72		)	(8	)
Postage, printing and supplies	58		85		(27		)	(32	)
Communications and data processing	1,043		987		56			6
Marketing and business development	190		270		(80		)	(30	)
FDIC premiums	147		314		(167		)	(53	)
Amortization of intangibles	343		470		(127		)	(27	)
Foreclosed property/problem asset expense	282		3		279			9,300
Other noninterest expense	1,278		1,611		(333		)	(21	)
Total noninterest expense	$	18,392	$	17,744	$	648		4		%

Noninterest expense for the first quarter of 2018 was $18.4 million, an increase of $648,000, or 4%, from the first quarter of 2017. The increase from the prior year is primarily due to higher salaries and employee benefits due to severance expense.

Salaries and employee benefits expense for the three months ended March 31, 2018 totaled $12.1 million, an increase of $1.0 million, or 9%, from the same period in 2017. The increase was primarily attributable to severance expense of $1.1 million in the first quarter of 2018. Full time equivalent headcount totaled 339 at March 31, 2018, compared to 331 at March 31, 2017, an increase of 8 positions, mainly due to growth in the Bank’s SBA lending team.

Occupancy costs were $1.4 million for the first quarter of 2018, an increase of $125,000, or 10%, compared to the first quarter of 2017. The increase was the result of higher rent expense due to the overlap of leases from the relocation of the Atlanta headquarters.

Professional services costs were $832,000 for the first quarter of 2018, a decrease of $72,000, or 8%, compared to the first quarter of 2017. The decrease was due to lower legal and consulting fees.

Communications and data processing costs were $1.0 million for the first quarter of 2018, an increase of $56,000, or 6%, compared to the first quarter of 2017. The increase was due to a higher volume of transactions with the Bank’s core processor.

FDIC premiums were $147,000 for the first quarter of 2018, a decrease of $167,000, or 53%, compared to the first quarter of 2017. The decrease was due to a lower assessment rate.

Amortization of intangibles includes the amortization of core deposit intangible related to the acquisition of First Security and totaled $343,000 for the three months ended March 31, 2018 and $470,000 for the three months ended March 31, 2017. The decrease in 2018 was partly due to the write-off of core deposit intangibles related to one branch divested during the second quarter of 2017.

Foreclosed property expense for the three months ended March 31, 2018 totaled $282,000, an increase of $279,000 from the same period in 2017. The increase is due to the revaluation and subsequent write-down of an existing other real estate owned property.

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Income Taxes

Atlantic Capital monitors and evaluates the potential impact of current events on the estimates used to establish income tax expenses and income tax liabilities. On a periodic basis, Atlantic Capital evaluates its income tax positions based on current tax law and positions taken by various tax auditors within the jurisdictions where Atlantic Capital is required to file income tax returns.

The income tax provision for the three months ended March 31, 2018 was $1.3 million as compared with $1.5 million for the same period in 2017. The effective tax rate (as a percentage of pre-tax earnings) was 20.5% for the three months ended March 31, 2018 compared to 31.7% for the same period in 2017. The decrease in the effective tax rate for the three months ended March 31, 2018 was due to the tax reform legislation signed into law in December 2017 that lowered the Federal corporate rate to 21%.

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts and their respective tax basis including operating losses and tax credit carryforwards. Net deferred tax assets (deferred tax assets net of deferred tax liabilities and valuation allowance) are reported in the consolidated balance sheet as a component of total assets. As of March 31, 2018, no remeasurement adjustments have been recorded as a result of the revaluation of deferred tax balances for the impact of the 2017 Tax Cuts and Jobs Act. The Company will continue to monitor and record any applicable adjustments in the period the amounts are determined.

Accounting Standards Codification Topic 740, Income Taxes , requires that companies assess whether a valuation allowance should be established against their deferred tax assets based on the consideration of all available evidence using a “more likely than not” standard. The determination of whether a valuation allowance for deferred tax assets is appropriate is subject to considerable judgment and requires an evaluation of all positive and negative evidence with more weight given to evidence that can be objectively verified. Each quarter, management considers both positive and negative evidence and analyzes changes in near-term market conditions as well as other factors which may impact future operating results.

Based on all evidence considered, as of March 31, 2018 and 2017, management concluded that it was more likely than not that the net deferred tax asset would be realized, except as outlined in the following discussion. At March 31, 2018 and 2017, Atlantic Capital recorded a deferred tax asset valuation allowance totaling $8.5 million and $9.2 million, respectively, on certain net operating loss carryforwards due to the fact that certain tax attributes are subject to an annual limitation as a result of the acquisition of First Security, which constituted a change of ownership as defined under Internal Revenue Code Section 382. Management expects to generate future taxable income and believes this will allow for full utilization of Atlantic Capital’s remaining net operating loss carryforwards within the statutory carryforward periods.

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FINANCIAL CONDITION

Total assets at March 31, 2018 and December 31, 2017 were $2.72 billion and $2.89 billion, respectively. Average total assets for the first quarter of 2018 were $2.70 billion, compared to $2.69 billion in the first quarter of 2017.

Loans

At March 31, 2018, total loans increased $24.9 million, or 1%, to $1.96 billion compared to $1.94 billion at December 31, 2017, primarily due to a $20.8 million, or 3%, increase in commercial and industrial loans and a $30.4 million, or 26%, increase in construction and land loans. These increases were offset by a decrease of $32.7 million, or 6%, in non-owner occupied commercial real estate loans. Table 6 provides additional information regarding Atlantic Capital’s loan portfolio.



Table 6 - Loans
(dollars in thousands)
	March 31, 2018			% of Total Loans		December 31, 2017			% of Total Loans
Loans held for sale
Other loans held for sale	$	835				$	1,487
Total loans held for sale	$	835				$	1,487

Loans held for investment
Commercial loans:
Commercial and industrial	$	636,181		32	%	$	615,359		32	%
Commercial real estate:
Owner occupied	353,235			18		346,746			18
Non-owner occupied	560,865			29		593,669			30
Construction and land	145,904			7		115,495			6
Mortgage warehouse participations	44,575			2		39,981			2
Total commercial loans	1,740,760			88		1,711,250			88

Residential:
Residential mortgages	105,255			5		104,484			5
Home equity	70,712			4		76,244			4
Total residential loans	175,967			9		180,728			9

Consumer	30,966			2		29,393			2
Other	15,181			1		16,278			1
	1,962,874					1,937,649
Less net deferred fees and other unearned income	(3,453		)			(3,810		)
Total loans held for investment	1,959,421					1,933,839

Total loans	$	1,960,256				$	1,935,326

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Nonperforming Assets

Nonperforming assets include nonaccrual loans, accruing loans past due 90 days or more, and other real estate owned. Loans are considered to be past due when payment is not received from the borrower by the contractually specified due date. Interest accruals on loans are discontinued when interest or principal has been in default 90 days or more, unless the loan is both secured by collateral that is sufficient to repay the debt in full and the loan is in the process of collection. When a loan is placed on nonaccrual status, interest accrued and not paid in the current accounting period is reversed against current period income. Interest accrued and not paid in prior periods, if significant, is reversed against the allowance for loan losses.

Income on such loans is subsequently recognized on a cash basis as long as the future collection of principal is deemed probable or after all principal payments are received. Commercial loans are placed back on accrual status after sustained performance of timely and current principal and interest payments and it is probable that all remaining amounts due, both principal and interest, are fully collectible according to the terms of the loan agreement. Residential loans and consumer loans are generally placed back on accrual status when they are no longer past due.

Purchased Credit Impaired (“PCI”) loans accounted for under ASC 310-30 are considered past due or delinquent when the contractual principal or interest due in accordance with the terms of the loan agreement remains unpaid after the due date of the scheduled payment. However, these loans are considered as performing, even though they may be contractually past due, as any non-payment of contractual principal or interest is considered in the periodic re-estimation of expected cash flows and is included in the resulting recognition of current period covered loan loss provision or future period yield adjustments. PCI loans were not classified as nonaccrual at March 31, 2018 as the carrying value of the respective loan or pool of loans cash flows were considered estimable and collection was probable. Therefore, interest revenue, through accretion of the difference between the carrying value of the loans and the expected cash flows, is being recognized on all PCI loans.

At March 31, 2018, Atlantic Capital’s nonperforming assets totaled $3.4 million, or 0.13% of total assets, compared to $4.1 million, or 0.14% of total assets, at December 31, 2017. The decrease was primarily due to a loan relationship totaling $298,000 which was past due 90 days and still accruing as of December 31, 2017 but became current in the first quarter, as well as a $288,000, or 24%, decrease in other real estate owned due to write downs.

Nonaccrual loans totaled $2.5 million and $2.6 million as of March 31, 2018 and December 31, 2017, respectively. Loans past due 90 days and still accruing totaled $35,000 at March 31, 2018 compared to $298,000 at December 31, 2017. Table 7 provides details on nonperforming assets and other risk elements.



Table 7 - Nonperforming assets
(dollars in thousands)

	March 31, 2018			December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017
Nonaccrual loans	$	2,466		$	2,614		$	4,058		$	11,909		$	3,212
Loans past due 90 days and still accruing	35			298			495			391			771
Total nonperforming loans* (NPLs)	2,501			2,912			4,553			12,300			3,983
Other real estate owned	927			1,215			1,494			1,819			1,869
Total nonperforming assets (NPAs)	$	3,428		$	4,127		$	6,047		$	14,119		$	5,852
NPLs as a percentage of total loans	0.13		%	0.15		%	0.24		%	0.63		%	0.21		%
NPAs as a percentage of total assets	0.13			0.14			0.23			0.52			0.21

*Nonperforming loans exclude those loans which are PCI loans

T roubled Debt Restructurings

Troubled Debt Restructurings (“TDRs”) are selectively made to provide relief to customers experiencing liquidity challenges or other circumstances that could affect their ability to meet their debt obligations. Typical modifications include short-term deferral of interest or modification of payment terms. Nonperforming TDRs are not accruing interest and are included as nonperforming assets within nonaccrual loans. TDRs which are accruing interest based on the restructured terms are considered performing. Table 8 summarizes TDRs.

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Table 8 - Troubled Debt Restructurings
(dollars in thousands)
	March 31, 2018		December 31, 2017
Accruing TDRs	$	5,167	$	5,323
Nonaccruing TDRs	—		—
Total TDRs	$	5,167	$	5,323

Potential Problem Loans

Management identifies and maintains a list of potential problem loans. These are loans that are internally risk graded special mention or below but which are not included in nonaccrual status and are not past due 90 days or more. A loan is added to the potential problem list when management becomes aware of information about possible credit problems of the borrower which raises doubts as to the ability of such borrower to comply with the current loan repayment terms. Potential problem loans totaled $69.7 million and $54.6 million, respectively, as of March 31, 2018 and December 31, 2017. Management closely tracks the financial performance of the borrower and the current values of collateral when assessing the collectability of these loans.

Allowance for Loan Losses

At March 31, 2018, the allowance for loan losses totaled $19.9 million, or 1.01% of loans, compared to $19.3 million, or 1.00% of loans, at December 31, 2017. The increase in the allowance was primarily related to an increase in outstanding loan balances.

Net charge-offs for the first quarter of 2018 and 2017 were $231,000 and $1.3 million, respectively. Table 9 provides details concerning the allowance for loan losses during the past five quarters.



Table 9 - Allowance for Loan Losses (ALL)
(dollars in thousands)
	2018				2017
	First				Fourth				Third				Second				First
	Quarter				Quarter				Quarter				Quarter				Quarter
Balance at beginning of period	$	19,344			$	18,870			$	21,870			$	19,939			$	20,595
Provision for loan losses	811				312				314				2,048				565
Provision for PCI loan losses	(39		)		(30		)		8				(68		)		69
Loans charged-off:
Commercial and industrial	(126		)		—				(3,292		)		—				(781		)
Commercial real estate	—				—				—				—				(132		)
Construction and land	—				—				(16		)		—				—
Residential mortgages	(70		)		—				—				—				(46		)
Home equity	(58		)		—				(31		)		(8		)		—
Consumer	(3		)		(13		)		(7		)		(57		)		(332		)
Other	—				—				—				—				—
Total loans charged-off	(257		)		(13		)		(3,346		)		(65		)		(1,291		)
Recoveries on loans previously charged-off:
Commercial and industrial	19				192				1				7				—
Commercial real estate	—				—				—				2				—
Construction and land	—				1				15				—				—
Residential mortgages	—				—				—				1				—
Home equity	—				—				—				1				—
Consumer	7				12				8				5				1
Other	—				—				—				—				—
Total recoveries	26				205				24				16				1
Net charge-offs	$	(231	)		$	192			$	(3,322	)		$	(49	)		$	(1,290	)
Balance at period end	$	19,885			$	19,344			$	18,870			$	21,870			$	19,939

Net charge-offs (annualized) to average loans	0.05			%	(0.04		)	%	0.68			%	0.01			%	0.26			%
Allowance for loan losses to loans held for investment	1.01				1.00				0.99				1.11				1.05

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Investment Securities

Investment securities available-for-sale totaled $458.7 million at March 31, 2018, compared to $449.1 million at December 31, 2017. Available-for-sale securities are reported at their aggregate fair value, and unrealized gains and losses are included as a component of other comprehensive income, net of deferred taxes. As of March 31, 2018, investment securities available-for-sale had a net unrealized loss of $14.1 million, compared to a net unrealized loss of $5.6 million as of December 31, 2017. Changes in interest rates and credit spreads result in temporary unrealized losses as the market price of securities fluctuate. After evaluating the securities with unrealized losses, management concluded that no other than temporary impairment existed as of March 31, 2018.

Changes in the amount of Atlantic Capital’s available-for-sale securities portfolio result primarily from balance sheet trends including loans, deposit balances and short-term borrowings. When inflows arising from deposits and short-term borrowings exceed loan demand, Atlantic Capital invests excess funds in the securities portfolio or in short-term investments. Conversely, when loan demand exceeds growth in deposits and short-term borrowings, Atlantic Capital allows interest-bearing balances with other banks to decline and uses proceeds from maturing or sold securities to fund loan demand. Details of investment securities at March 31, 2018 and December 31, 2017 are provided in Table 10.



Table 10 - Securities
(dollars in thousands)
	March 31, 2018				December 31, 2017
Available-For-Sale Securities	Amortized Cost		Fair Value		Amortized Cost		Fair Value
U.S. Government agencies	$	37,364	$	36,532	$	34,699	$	34,111
U.S. states and political divisions	92,005		85,813		92,169		90,001
Trust preferred securities	4,761		4,650		4,754		4,650
Corporate debt securities	12,925		12,457		12,948		12,622
Residential mortgage-backed securities	325,809		319,278		310,129		307,733
Total	$	472,864	$	458,730	$	454,699	$	449,117

The effective duration of Atlantic Capital’s securities at March 31, 2018 was 4.99 years.

Goodwill and Other Intangible Assets

Atlantic Capital’s core deposit intangible representing the value of the acquired deposit base, is an amortizing intangible asset that is required to be tested for impairment only when events or circumstances indicate that impairment may exist. There were no events or circumstances that led management to believe that any impairment existed at March 31, 2018 in Atlantic Capital’s other intangible assets.

Goodwill represents the premium paid for acquired companies above the fair value of the assets acquired and liabilities assumed, including separately identifiable intangible assets. Atlantic Capital evaluates its goodwill annually, or more frequently if necessary, to determine if any impairment exists.

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LIQUIDITY AND CAPITAL RESOURCES

Deposits

At March 31, 2018, total deposits were $2.10 billion, a decrease of $354.4 million, or 14%, from December 31, 2017. Noninterest-bearing demand deposits decreased $132.6 million, or 18%, and money market deposits decreased $206.4 million, or 18%, from December 31, 2017 to March 31, 2018. The decrease was the result of seasonal volatility and a large increase in temporary deposits during the quarter ended December 31, 2017.

Total average deposits for the quarter ended March 31, 2018 were $2.15 billion, an increase of $41.9 million, or 2%, from the same period in 2017. Average interest-bearing demand deposits increased $38.3 million, or 13%, average money market deposits increased $82.9 million, or 10%, and average brokered deposits decreased $73.8 million, or 39%, for the quarter ended March 31, 2018 from the same period in 2017. Table 11 provides additional information regarding deposits during the past five quarters.



Table 11 - Deposits
(dollars in thousands)

Period End Deposits

	March 31, 2018			December 31, 2017			September 30, 2017			June 30, 2017			March 31, 2017			Linked Quarter Change			Year Over Year Change
DDA	$	599,838		$	732,442		$	599,292		$	612,744		$	606,386		$	(132,604	)	$	(6,548	)
NOW	302,636			306,331			270,740			250,254			259,760			(3,695		)	42,876
Savings	29,407			26,573			30,131			30,170			30,756			2,834			(1,349		)
Money Market	911,449			1,117,891			865,238			882,824			916,390			(206,442		)	(4,941		)
Time	140,594			138,612			144,250			142,915			150,867			1,982			(10,273		)
Brokered	112,376			128,816			193,994			195,047			209,385			(16,440		)	(97,009		)
Deposits to be assumed in branch sale	—			—			—			—			29,495			—			(29,495		)
Total Deposits	$	2,096,300		$	2,450,665		$	2,103,645		$	2,113,954		$	2,203,039		$	(354,365	)	$	(106,739	)

Payments Clients	$	311,943		$	405,873		$	239,079		$	250,104		$	321,899		$	(93,930	)	$	(9,956	)

Average Deposits ⁽¹⁾

	2018			2017												Linked Quarter Change			Year Over Year Change
	First Quarter			Fourth Quarter			Third Quarter			Second Quarter			First Quarter			Linked Quarter Change			Year Over Year Change
DDA	$	638,730		$	649,218		$	628,029		$	626,330		$	620,325		$	(10,488	)	$	18,405
NOW	329,171			338,741			291,810			293,160			290,862			(9,570		)	38,309
Savings	29,609			29,851			30,236			30,468			30,306			(242		)	(697		)
Money Market	898,800			907,524			870,618			860,116			815,920			(8,724		)	82,880
Time	139,788			140,921			143,862			149,898			163,021			(1,133		)	(23,233		)
Brokered	117,787			128,594			156,708			198,703			191,558			(10,807		)	(73,771		)
Total Deposits	$	2,153,885		$	2,194,849		$	2,121,263		$	2,158,675		$	2,111,992		$	(40,964	)	$	41,893

Payments Clients	$	256,794		$	234,558		$	209,851		$	244,157		$	273,630		$	22,236		$	(16,836	)

Noninterest bearing deposits as a percentage of average deposits	29.7		%	29.6		%	29.6		%	29.0		%	29.4		%
Cost of deposits	0.57		%	0.52		%	0.50		%	0.46		%	0.39		%

⁽¹⁾ Includes average balances of deposits to be assumed in branch sale.

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Short-Term Borrowings

At March 31, 2018 and December 31, 2017, balances of federal funds purchased were $40.0 million and $0, respectively. There were securities sold under repurchase agreements with commercial checking customers totaling $7.9 million and $0 as of March 31, 2018 or December 31, 2017, respectively.

As a member of the Federal Home Loan Bank of Atlanta (“FHLB”), Atlantic Capital has the ability to acquire short and long-term advances through a blanket agreement secured by our unencumbered qualifying 1-4 family first mortgage loans and by pledging investment securities or individual, qualified loans, subject to approval of the FHLB. At March 31, 2018 and December 31, 2017, Atlantic Capital had FHLB advances of $185.0 million and $45.0 million, respectively. FHLB borrowings increased due to an increase in short-term funding needs.

Long-Term Debt

During the third quarter of 2015, Atlantic Capital issued $50.0 million in fixed-to-floating rate subordinated notes due in 2025, all of which was outstanding at March 31, 2018.

Liquidity Risk Management

Liquidity risk is the risk that an institution will be unable to generate or obtain sufficient funding, at a reasonable cost, to meet operational cash needs and to take advantage of revenue producing opportunities as they arise. Other forms of liquidity risk include market constraints on the ability to convert assets into cash at expected levels, an inability to access funding sources at sufficient levels at a reasonable cost, and changes in economic conditions or exposure to credit, market, operational, legal and reputation risks that can affect an institution’s liquidity risk profile. Liquidity management involves maintaining Atlantic Capital’s ability to meet the daily cash flow requirements of Atlantic Capital’s customers, both depositors and borrowers.

Atlantic Capital utilizes various measures to monitor and control liquidity risk across three different types of liquidity:


•	tactical liquidity measures the risk of a negative cash flow position whereby cash outflows exceed cash inflows over a short-term horizon;


•	structural liquidity measures the amount by which illiquid assets are supported by long-term funding; and


•	contingent liquidity utilizes cash flow stress testing across three crisis scenarios to determine the adequacy of Atlantic Capital’s liquidity.

Atlantic Capital aims to maintain a diverse mix of existing and potential liquidity sources to support the liquidity management function. At its core is a reliance on the customer deposit book, due to the low cost it offers. Other sources of liquidity include asset-based liquidity in the form of cash and unencumbered securities, as well as access to wholesale funding from external counterparties, primarily advances from the FHLB of Atlanta, Federal Funds lines and other borrowing facilities. Atlantic Capital aims to avoid funding concentrations by diversifying external secured and unsecured funding with respect to maturities, counterparties and nature. At March 31, 2018, management believed that Atlantic Capital had sufficient on-balance sheet liquidity to meet its funding needs.

At March 31, 2018, Atlantic Capital had access to $335.0 million in unsecured borrowings and $711.6 million in secured borrowings through various sources. Atlantic Capital also has the ability to attract more retail deposits by offering aggressively priced rates.

Shareholders’ Equity and Capital Adequacy

Shareholders’ equity at March 31, 2018 was $307.1 million, a decrease of $1.4 million from December 31, 2017. Atlantic Capital and the Bank are required to meet minimum capital requirements imposed by regulatory authorities. Failure to meet certain capital requirements may result in actions by regulatory agencies that could have a material impact on Atlantic Capital’s consolidated financial statements. Tables 12 and 13 provide additional information regarding regulatory capital requirements and Atlantic Capital’s capital levels. Accumulated other comprehensive income, which includes unrealized gains and losses on securities available-for-sale and unrealized gains and losses on derivatives qualifying as cash flow hedges, is excluded in the calculation of regulatory capital ratios.

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Table 12 - Capital Ratios
(dollars in thousands)
	Consolidated						Bank						Regulatory Guidelines
	March 31, 2018			December 31, 2017			March 31, 2018			December 31, 2017			Minimum		Well capitalized		Minimum Capital plus capital conservation buffer 2019
Risk based ratios:
Common equity tier 1 capital	11.3		%	11.2		%	12.8		%	12.7		%	4.5	%	6.5	%	7.0	%
Tier 1 Capital	11.3			11.2			12.8			12.7			6.0		8.0		8.5
Total capital	14.3			14.1			13.7			13.6			8.0		10.0		10.5
Leverage ratio	10.1			9.7			11.3			11.1			4.0		5.0		N/A

Common equity tier 1 capital	$	266,769		$	259,865		$	303,540		$	295,629
Tier 1 capital	266,769			259,865			303,540			295,629
Total capital	337,118			329,641			324,312			315,870

Risk weighted assets	2,364,023			2,330,574			2,363,349			2,330,171
Quarterly average total assets for leverage ratio	2,652,005			2,667,652			2,681,691			2,675,228

Atlantic Capital continues to exceed minimum capital standards and the Bank remains “well-capitalized” under regulatory guidelines.

In July 2013, bank regulatory agencies approved the Basel III capital guidelines, which are aimed at strengthening existing capital requirements for bank holding companies through a combination of higher minimum capital requirements, new capital conservation buffers and more conservative definitions of capital and balance sheet exposure. Atlantic Capital and the Bank became subject to the requirements of Basel III effective January 1, 2015, subject to a transition period for several aspects of the rule.

Under the revised rules, Atlantic Capital’s common equity tier 1 ratio was 11.3 % at March 31, 2018, exceeding the fully phased-in minimum of 7.0%, which includes the 2.5% minimum capital conservation buffer. Management continues to monitor Basel III developments and remains committed to managing Atlantic Capital’s capital levels in a prudent manner.



Table 13 - Tier 1 Common Equity
(dollars in thousands)

	March 31, 2018
Tier 1 capital	$	266,769
Less: restricted core capital	—
Tier 1 common equity	$	266,769

Risk-adjusted assets	$	2,364,023
Tier 1 common equity ratio	11.3		%

Off-Balance Sheet Arrangements

Atlantic Capital makes contractual commitments to extend credit and issues standby letters of credit in the ordinary course of its business activities. These commitments are legally binding agreements to lend money to customers at predetermined interest rates for a specified period of time. In addition to commitments to extend credit, Atlantic Capital also issues standby letters of credit which are assurances to a third party that it will not suffer a loss if the customer fails to meet a contractual obligation to the third party. At March 31, 2018, Atlantic Capital had issued commitments to extend credit of approximately $688.3 million and standby letters of credit of approximately $13.6 million through various types of commercial lending arrangements.

Based on historical experience, many of the commitments and letters of credit will expire unfunded. Through its various sources of liquidity, Atlantic Capital believes it will be able to fund these obligations as they arise. Atlantic Capital evaluates each customer’s credit worthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary upon extension of credit, is

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based on Atlantic Capital’s credit evaluation of the borrower. Collateral varies but may include accounts receivable, inventory, property, plant and equipment, and commercial and residential real estate.

Contractual Obligations

There have been no significant changes in Atlantic Capital’s contractual obligations at March 31, 2018 compared to December 31, 2017.

RISK MANAGEMENT

Effective risk management is critical to Atlantic Capital’s success. The Dodd-Frank Act requires that bank holding companies with total assets in excess of $10 billion establish an enterprise-wide risk committee consisting of members of its board of directors. Although Atlantic Capital does not have total assets in excess of $10 billion, the Bank’s board of directors has an Audit and Risk Committee that, among other responsibilities, provides oversight of enterprise-wide risk management activities. The Audit and Risk Committee reviews the Bank’s activities in identifying, measuring and mitigating existing and emerging risks (including credit, liquidity, interest-rate, compliance, operational, strategic and reputational risks). The committee monitors management’s execution of risk management practices in accordance with the risk appetite of the Bank, reviews supervisory examination reports together with management’s response to such examinations and discusses legal matters that may have a material impact on the financial statements or Atlantic Capital’s compliance policies. With guidance from and oversight by the Audit and Risk Committee, management continually refines and enhances its risk management policies and procedures to maintain effective risk management programs and processes.

Credit Risk Management

Credit risk is the risk of not collecting payments pursuant to the contractual terms of loans, leases and investment securities. Atlantic Capital manages credit risk closely by having appropriate policies and procedures for the types of loans we make. To ensure that lending policies and procedures are followed, Atlantic Capital has an independent credit review function that conducts risk reviews and analyses of loans to help assure compliance with credit policies and to monitor asset quality trends. The risk reviews include portfolio analysis by industry, collateral type and product. Atlantic Capital has implemented policies and procedures designed to identify potential problem loans as early as possible, to record charge-offs or write-downs as appropriate and to maintain adequate allowances for loan losses that are inherent in the loan portfolio.

Market Risk Management

Market risk reflects the risk of economic loss resulting from adverse changes in market price and interest rates. This risk of loss can be reflected in diminished current market values and/or reduced potential net interest income in future periods. Atlantic Capital’s market risk arises primarily from interest rate risk inherent in Atlantic Capital’s lending and deposit-taking activities. The structure of Atlantic Capital’s loan and deposit portfolios is such that a significant decline in interest rates may adversely impact net market values and net interest income. Atlantic Capital does not maintain a trading account nor is Atlantic Capital subject to currency exchange risk or commodity price risk. Since interest rate risk is by far the most significant element of Atlantic Capital’s market risk, we rely on the risk management methods noted below for interest rate risk to manage market risk.

Interest Rate Risk Management

Interest rate risk results principally from assets and liabilities maturing or repricing at different points in time, from assets and liabilities repricing at the same point in time but in different amounts and from short-term and long-term interest rates changing in different magnitudes. Market interest rates also have an impact on the interest rate and repricing characteristics of loans that are originated as well as the rate characteristics of interest-bearing liabilities.

Atlantic Capital assesses interest rate risk by forecasting net interest income under various interest rate scenarios and comparing those results to forecasted net interest income assuming stable rates. Atlantic Capital’s rate shock simulation, as of March 31, 2018, indicates that, over a 12-month period, net interest income is estimated to increase by 10.87 % with rates rising 200-basis points. The increase in net interest income is primarily due to the short-term repricing characteristics of the loan portfolio, combined with a favorable funding mix. Atlantic Capital’s loan portfolio consists mainly of floating rate loans. Atlantic Capital’s core client deposits are likely to allow Atlantic Capital to lag short term interbank rate indices when pricing deposits. Transaction accounts comprise a significant amount of Atlantic Capital’s total deposits.

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Table 14 provides the impact on net interest income resulting from various interest rate scenarios as of March 31, 2018 and December 31, 2017.



Table 14 - Net Interest Income Sensitivity Simulation Analysis

	Estimated change in net interest income
Change in interest rate (basis point)	March 31, 2018			December 31, 2017
-100	(6.46	)	%	(10.68	)	%
+100	5.63			7.68
+200	10.87			15.64
+300	16.09			23.30

Atlantic Capital also utilizes the market value of equity (“MVE”) as a tool in measuring and managing interest rate risk. L ong-term interest rate risk exposure is measured using the MVE sensitivity analysis to study the impact of long-term cash flows on capital. As of March 31, 2018, the MVE calculated with a 200-basis point shock up in rates decreased by 4.16 % from the base case MVE value. Table 15 presents the MVE profile as of March 31, 2018 and December 31, 2017.



Table 15 - Market Value of Equity Modeling Analysis

	Estimated % change in MVE
Change in interest rate (basis point)	March 31, 2018			December 31, 2017
-100	(1.15	)	%	(3.09	)	%
+100	(1.45	)		1.31
+200	(4.16	)		1.38
+300	(17.60	)		0.59

Atlantic Capital may utilize interest rate swaps, floors, collars or other derivative financial instruments in an attempt to manage Atlantic Capital’s overall sensitivity to changes in interest rates.

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ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The information required by this item is included in Part I, Item 2 of this report under “Management’s Discussion and Analysis of Financial Condition and Results of Operations-Risk Management.”


ITEM 4.	CONTROLS AND PROCEDURES

The Company maintains disclosure controls and procedures as required under Rule 13a-15 promulgated under the Exchange Act, that are designed to ensure that information required to be disclosed in the Company’s Exchange Act reports is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. As of March 31, 2018 , the Company’s management carried out an evaluation, under the supervision and with the participation of the Chief Executive Officer and Chief Financial Officer, of the effectiveness of its disclosure controls and procedures. Based on the foregoing, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of March 31, 2018 .

No changes were made to the Company’s internal control over financial reporting (as defined in Rule 13a-15(f) promulgated under the Exchange Act) during the quarter ended March 31, 2018 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

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PART II - OTHER INFORMATION


ITEM 1.	LEGAL PROCEEDINGS

In the ordinary course of operations, Atlantic Capital and the Bank are defendants in various legal proceedings. Additionally, in the ordinary course of business, Atlantic Capital and the Bank are subject to regulatory examinations and investigations. Based on our current knowledge and advice of counsel, in the opinion of management there is no such pending or threatened legal matter which would result in a material adverse change, either individually or in the aggregate, in the consolidated financial condition or results of operations of Atlantic Capital.


ITEM 1A.	RISK FACTORS

In addition to the other information set forth in this report, you should carefully consider the factors discussed in the Company’s Annual Report on Form 10-K for the period ended December 31, 2017, under Part I, Item 1A “Risk Factors,” because these risk factors may affect the operations and financial results of the Company. Our evaluation of our risk factors has not changed materially since those discussed in the Annual Report. The risks described in the Annual Report are not the only risks facing the Company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition, and operating results.


ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.


ITEM 3.	DEFAULTS UPON SENIOR SECURITIES

None.


ITEM 4.	MINE SAFETY DISCLOSURES

Not applicable.


ITEM 5.	OTHER INFORMATION

None.

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ITEM 6.	EXHIBITS



3.1	Amended and Restated Articles of Incorporation of Atlantic Capital Bancshares, Inc., which is incorporated by reference to Exhibit 3.1 to our Registration Statement on Form S-4 (file no. 333-204855), initially filed with the Securities and Exchange Commission on June 10, 2015
3.2	Amended and Restated Bylaws of Atlantic Capital Bancshares, Inc., which is incorporated by reference to Exhibit 3.1 to our Current Report on Form 8-K (file no. 001-37615), filed with the Securities and Exchange Commission on January 19, 2017
10.1	Executive Officer Long Term Incentive Plan (as Amended and Restated Effective April 19, 2018), which is incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K (file no. 001-37615), filed with the Securities and Exchange Commission on April 20, 2018.*
10.2	Form of Restricted Stock Award Agreement (Employees - with Employment Agreement) under the 2015 Stock Incentive Plan*
10.3	Form of Restricted Stock Award Agreement (Employees - without Employment Agreement) under the 2015 Stock Incentive Plan*
10.4	Form of Restricted Stock Unit Agreement (Employees - with Employment Agreement) under the 2015 Stock Incentive Plan*
10.5	Form of Restricted Stock Unit Agreement (Employees - without Employment Agreement) under the 2015 Stock Incentive Plan*
10.6	Form of Stock Option Agreement (Employees - with Employment Agreement) under the 2015 Stock Incentive Plan*
10.7	Form of Stock Option Agreement (Employees - without Employment Agreement) under the 2015 Stock Incentive Plan*
10.8	Form of Performance Share Award Agreement (Employees - with Employment Agreement) (Executive Officer Long Term Incentive Plan (“LTIP”) Award)*
10.9	Form of Performance Share Award Agreement (Employees - without Employment Agreement) (Executive Officer Long Term Incentive Plan (“LTIP”) Award)*
31.1	Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification of Chief Executive Officer pursuant to Rule 13a-14(b) under the Exchange Act, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2	Certification of Chief Financial Officer pursuant to Rule 13a-14(b) under the Exchange Act, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101	The following materials from our Quarterly Report on Form 10-Q for the quarter ended March 31, 2018, formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets as of March 31, 2018 and December 31, 2017; (ii) the Consolidated Statements of Income for the three months ended March 31, 2018 and 2017; (iii) the Consolidated Statements of Comprehensive Income for the three months ended March 31, 2018 and 2017; (iv) the Consolidated Statements of Shareholders’ Equity for the three months ended March 31, 2018 and 2017; (v) the Consolidated Statements of Cash Flows for the three months ended March 31, 2018 and 2017; and (vi) the Notes to the Unaudited Consolidated Financial Statements

* Management contract or compensatory plan or arrangement.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized.



	ATLANTIC CAPITAL BANCSHARES, INC.

	/s/ Douglas L. Williams
	Douglas L. Williams
	President and Chief Executive Officer
	(Principal Executive Officer)


	/s/ Patrick T. Oakes
	Patrick T. Oakes
	Executive Vice President and
	Chief Financial Officer
	(Principal Financial and Accounting Officer)




	Date: May 9, 2018

Exhibit 10.2

Restricted Stock Award No. __

ATLANTIC CAPITAL BANCSHARES, INC.

2015 STOCK INCENTIVE PLAN

Restricted Stock Award Agreement

(Employees)

Name of Participant:

Grant Date:

Number of Shares Subject to Award:

THIS AGREEMENT (together with Schedules A and B attached hereto, this “ Agreement ”) is made effective as of the ____ day of ________________ (the “ Grant Date ”) between Atlantic Capital Bancshares, Inc., a Georgia corporation (the “ Company ”), and _______________________, an Employee of the Company or an Affiliate (the “ Participant ”).

R E C I T A L S:

In furtherance of the purposes of the Atlantic Capital Bancshares, Inc. 2015 Stock Incentive Plan, as it may be amended (the “ Plan ”), and in consideration of the services of the Participant and such other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Participant hereby agree as follows:

1. Incorporation of Plan . The rights and duties of the Company and the Participant under this Agreement shall in all respects be subject to and governed by the provisions of the Plan, a copy of which is delivered herewith or has been previously provided to the Participant and the terms of which are incorporated herein by reference. In the event of any conflict between the provisions in this Agreement and those of the Plan, the provisions of the Plan shall govern, unless the Administrator determines otherwise. Unless otherwise defined herein, capitalized terms in this Agreement shall have the same definitions as set forth in the Plan.

2. Grant of Restricted Stock Award.

(a) The number of shares of the Company’s common stock (the “ Common Stock ”) subject to the Restricted Stock Award (the “ Award ”) granted under this Agreement shall be ______ shares (the “ Shares ”). Any portion of the Shares subject to the Award which have not vested (due to continued service requirements, performance objectives or other conditions) shall be referred to as “ Unvested Shares .” Any portion of the Shares subject to the Award which were granted without being subject to continued service, performance objectives or other conditions, and/or shares as to which such conditions have been met or cancelled, shall be referred to as “ Vested Shares .”

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Rev. April 2018

(b) Subject to the terms of this Agreement and the Plan, the Company hereby grants the Participant, as a matter of separate inducement and agreement in connection with his or her employment with or service to the Company, and not in lieu of any salary or other compensation for his or her services, this Award for that number of Shares as is set forth in this Section 2. The Participant expressly acknowledges that the terms of Schedules A and B shall be incorporated herein by reference and shall constitute part of this Agreement.

3. Share Certificates; Dividends and Voting Rights . Subject to the conditions of this Section 3, a certificate or certificates representing the Shares subject to the Award shall be issued in the name of the Participant promptly after the Grant Date. The Participant shall not be deemed to be the holder of any of the Shares subject to the Award and shall not have any rights of a shareholder unless and until certificates for such Shares have been issued to him or her. The Administrator shall require, as a condition to the grant of the Award and the issuance of the Shares, that (a) the Participant deliver the certificate(s) representing all of the Unvested Shares to the Administrator or its designee to be held in escrow until the Award vests and is no longer subject to a substantial risk of forfeiture (in which case the Shares shall be promptly released to the Participant) or is forfeited (in which case the Shares shall be returned to the Company); and/or (b) the Participant deliver to the Company a stock power, endorsed in blank (or similar instrument), relating to the Unvested Shares and in addition to both (a) and (b), the Participant has executed such other agreements required under Section 10(a). Upon the issuance and delivery of a certificate for the Shares, the Participant shall have such rights and incidents of ownership of the Shares acquired pursuant to the Award, including voting rights, as are permitted by the Plan, this Agreement, any other agreements and any Applicable Law; provided, however, that, (a) except as otherwise provided in Section 5(b) herein, any Unvested Shares subject to the Award (and any related voting rights, dividend rights or other rights as a shareholder) shall be forfeited in the event that the employment or service of the Participant terminates (for any reason) prior to the time such Unvested Shares vest, and in the event of such termination or forfeiture, the Participant shall have no rights with respect to the Award or the Unvested Shares; (b) all of the Shares subject to the Award shall be subject to any restrictions applicable under the Plan (including but not limited to the provisions of Section 18 therein), this Agreement and any other applicable agreements; and (c) if any cash or non-cash dividends are declared and paid by the Company with respect to any Shares subject to the Award (to the extent that the Award is not then vested), the Participant shall have dividend rights with respect to such Shares, but such dividend rights shall be subject to the same vesting schedule, forfeiture terms and other restrictions as are applicable to the underlying Shares.

4. Vesting of Award.

(a) Subject to the terms of the Plan and this Agreement, including but not limited to Section 5 and Section 12 herein, the Award shall vest and be earned, and the Shares subject to the Award shall vest and be earned, upon such date or dates, and subject to such conditions, as are described on Schedule A, which is attached hereto and expressly made a part of this Agreement. Without limiting the effect of the foregoing, the Shares subject to the Award may vest in installments over a period of time, if so provided in Schedule A. The Participant expressly acknowledges that the Award shall vest only upon such terms and conditions as are provided in this Agreement (including but not limited to Schedule A) and otherwise in accordance with the terms of the Plan.

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Rev. April 2018

Notwithstanding anything to the contrary herein, the Protective Covenants contained in the Agreement between the Participant and the Company dated ______________, 20___ (the “ Employment Agreement ”), a copy of which is attached hereto as Schedule B and incorporated herein by reference, shall remain in full force and effect according to their terms regardless of whether the Participant’s rights under this Agreement have vested or not or have been forfeited or not.

(b) The Administrator has sole authority to determine whether and to what degree the Award has vested and been earned and is payable and to interpret the terms and conditions of this Agreement and the Plan.

5. Effect of Termination of Employment or Service.

(a) Except as otherwise provided in this Section 5 or in Section 12 herein, if the employment or service of the Participant is terminated for any reason (whether by the Company or the Participant and whether voluntary or involuntary or with or without Cause) (such date of termination of employment or service being referred to as the “ Termination Date ”) and all or any part of the Award has not vested or been earned pursuant to the terms of the Plan and this Agreement, then the Award, to the extent not vested or earned as of the Participant’s Termination Date, shall be forfeited immediately upon such termination, and the Participant shall have no further rights with respect to the Award or the Shares underlying that portion of the Award that has not yet been earned and vested (that is, the Unvested Shares). The Participant expressly acknowledges and agrees that the termination of his or her employment or service shall (except as may otherwise be provided in this Agreement or the Plan) result in forfeiture of the Award and the Shares to the extent that the Award has not been earned and vested as of his or her Termination Date.

(b) Notwithstanding the provisions of Section 5(a), and subject to the terms of Section 3(c) of the Plan, the Award shall become 100% earned and vested upon the termination of the Participant’s employment or service if and only if the Participant’s termination is due to:

(i) death;

(ii) Disability; or

(iii) Good Reason (as defined in the Participant’s Employment Agreement or if there is no Employment Agreement defining Good Reason, as defined in Section 5(c) of this Agreement).

(c) For purposes of this Section 5, “ Good Reason ” shall occur if during the Participant’s employment, the Participant’s employment is materially and adversely altered by the Company, without the Participant’s consent, by:

(i) a material reduction in the Participant’s base salary;

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Rev. April 2018

(ii) the assignment to the Participant of duties or responsibilities materially inconsistent with, or a material diminution in, the Participant’s position, authority, duties or responsibilities; or

(iii) the relocation of the Participant’s principal place of employment by more than 30 miles from the location at which the Participant is stationed.

An event or condition that would otherwise constitute “Good Reason” shall constitute Good Reason only if the Company fails to rescind or cure such event or condition within 30 days after receipt from the Participant of written notice of the event which constitutes Good Reason, and Good Reason shall cease to exist for any event or condition described herein on the 60th day following the later of the occurrence or the Participant’s knowledge thereof, unless the Participant has given the Company written notice thereof prior to such date.

The Administrator shall have the sole discretion to determine the basis for the Participant’s termination of employment or service, including whether such termination is due to Disability, Good Reason or Cause.

6. No Right of Continued Employment or Service; Forfeiture of Award; No Rights to Future Awards . Neither the Plan, this Agreement, the grant of the Award nor any other action related to the Plan shall confer upon the Participant any right to continue in the employ or service of the Company or an Affiliate or to interfere in any way with the right of the Company or an Affiliate to terminate the Participant’s employment or service at any time. Except as otherwise provided in the Plan or this Agreement or as may be determined by the Administrator, all rights of the Participant with respect to the unvested portion of the Award shall terminate upon termination of the Participant’s employment or service with the Company or an Affiliate. The Participant acknowledges and agrees that the Company has no obligation to advise the Participant of the expiration of the Award. The grant of the Award does not create any obligation to grant further awards.

7. Nontransferability of Award . The Award shall not be transferable (including by sale, assignment, pledge or hypothecation) other than transfers by will or the laws of intestate succession, and the Participant or other recipient of the Award shall not sell, transfer, assign, pledge or otherwise encumber the Shares subject to the Award until the Restriction Period has expired and all conditions to vesting have been met. The designation of a beneficiary in accordance with the Plan does not constitute a transfer.

8. Superseding Agreement; Binding Effect . This Agreement supersedes any statements, representations or agreements of the Company with respect to the grant of the Award, and the Participant hereby waives any rights or claims related to any such statements, representations or agreements. This Agreement does not supersede or amend any existing confidentiality agreement, non-competition agreement, non-solicitation agreement, employment agreement, consulting agreement or any other similar agreement between the Participant and the Company, including but not limited to any restrictive covenants contained in such agreements, which shall remain in full force and effect and enforceable in accordance with their terms. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective executors, administrators, next-of-kin, successors and assigns.

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9. Representations and Warranties of Participant . The Participant represents and warrants to the Company that:

(a) Agrees to Terms of the Plan and Agreement . The Participant has received a copy of the Plan, has read and understands the terms of the Plan and this Agreement and agrees to be bound by their terms and conditions.

(b) Tax Consequences . The Participant acknowledges that he or she is solely responsible and liable for the satisfaction of all taxes and penalties that may arise in connection with the Award (including but not limited to any taxes arising under Code Section 409A), and the Company shall not have any obligation to indemnify or otherwise hold the Participant harmless from any or all such taxes. The Participant further acknowledges that the Company has made no warranties or representations to the Participant with respect to the tax consequences (including but not limited to income tax consequences) related to the transactions contemplated by this Agreement, and the Participant is in no manner relying on the Company or its representatives for an assessment of such tax consequences. The Participant acknowledges that there may be adverse tax consequences upon acquisition or disposition of the Shares subject to the Award and that the Participant should consult a tax advisor prior to such acquisition or disposition. The Participant acknowledges that he or she has been advised that he or she should consult with his or her own attorney, accountant and/or tax advisor regarding the decision to enter into this Agreement and the consequences thereof. The Participant also acknowledges that the Company has no responsibility to take or refrain from taking any actions in order to achieve a certain tax result for the Participant.

10. Restrictions on Award and Shares.

(a) Other Agreements . As a condition to the issuance and delivery of the Shares subject to the Award, or the grant of any benefit pursuant to the terms of the Plan, the Company may require the Participant or other person to become a party to this Agreement, any shareholders’ agreement, other agreement(s) restricting the transfer, purchase or repurchase of shares of Common Stock of the Company, voting agreement and/or employment agreements, consulting agreements, non-competition agreements, confidentiality agreements, non-solicitation agreements or other agreements imposing such restrictions as may be required by the Company. In addition, without in any way limiting the effect of the foregoing, the Participant or other holder of the Shares shall be permitted to transfer such Shares only if such transfer is in accordance with the terms of the Plan, this Agreement, any shareholders’ agreement and any other applicable agreements. The acquisition of the Shares by the Participant or any other holder of the Shares shall be subject to, and conditioned upon, the agreement of the Participant or other holder of such Shares to the restrictions described in the Plan, this Agreement, any shareholders’ agreement and any other applicable agreements.

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unless such delivery, distribution or action is in compliance with Applicable Law (including but not limited to the requirements of the Securities Act). The Company is under no obligation to register the Shares with the Securities and Exchange Commission or to effect compliance with the exemption, registration, qualification or listing requirements of any state securities laws, stock exchange or similar organization, and the Company shall have no liability for any inability or failure to do so. The Company may cause a restrictive legend or legends to be placed on any certificate for Shares issued pursuant to the Award in such form as may be prescribed from time to time by Applicable Law or as may be advised by legal counsel.

11. Certain Changes in Status . The Participant acknowledges that the Administrator has the sole discretion to determine (taking into account any Code Section 409A considerations), at any time, the effect, if any, on the Award (including but not limited to modifying the vesting and/or earning of the Award) of any changes in the Participant’s status (other than termination) as an Employee, including but not limited to a change from full-time to part-time, or vice versa, or other similar changes in the nature or scope of the Participant’s employment or service.

12. Effect of Change of Control.

(a) Notwithstanding any other provision in the Plan to the contrary (and unless otherwise required pursuant to Code Section 409A), the following provisions shall apply in the event of a Change of Control:

(i) To the extent that the successor or surviving company in the Change of Control event does not assume or substitute the Award (or in which the Company is the ultimate parent corporation and does not continue the Award) on substantially similar terms or with substantially equivalent economic benefits (as determined by the Administrator) as the Award outstanding immediately prior to the Change of Control event, any restrictions, including but not limited to the Restriction Period, Performance Period and/or performance criteria applicable to the Award shall be deemed to have been met, and the Award shall become fully vested, earned and payable to the fullest extent of the original grant of the Award (or, if the Award is performance-based and the earning of which is based on attaining a target level of performance, the Award shall be deemed earned at target).

(ii) Further, in the event that the Award is substituted, assumed or continued as provided in Section 12(a) herein, the Award shall nonetheless become vested in full and any restrictions, including but not limited to the Restriction Period, Performance Period and/or performance criteria applicable to the Award shall be deemed to have been met, and the Award shall become fully vested, earned and payable to the fullest extent of the original award (or, if the Award is performance-based and the earning of which is based on attaining a target level of performance, the Award shall be deemed earned at target), if the employment or service of the Participant is terminated within six months before (in which case vesting shall not occur until the effective date of the Change of Control) or one year (or such other period after a Change of Control as may be stated in a Participant’s employment, change of control, consulting or other similar agreement, if applicable) after the effective date of a Change of Control if such termination of employment or service (i) is by the Company not for Cause or (ii) is by the Participant for Good Reason. For

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Rev. April 2018

clarification, for the purposes of this Section 12, the “Company” shall include any successor to the Company.

(iii) Notwithstanding any other provision of the Plan to the contrary, in the event that the Participant has entered into an employment agreement as of the Effective Date of the Plan or is a participant in the Company’s Change in Control Plan or similar arrangement, the Participant shall be entitled to the greater of the benefits provided upon a change of control of the Company under the Plan or the respective employment agreement, Change in Control Plan or other arrangement, and such agreement, Change in Control Plan or other arrangement shall not be construed to reduce in any way the benefits otherwise provided to the Participant upon a Change of Control as defined in the Plan.

(b) For the purposes herein, except as may be otherwise required, if at all, under Code Section 409A, a “Change of Control” shall be deemed to have occurred on the earliest of the following dates:

(i) The date any entity or person shall have become the beneficial owner of, or shall have obtained voting control over, more than fifty percent (50%) of the total voting power of the Company’s then outstanding voting stock;

(ii) The date of the consummation of (A) a merger, consolidation or reorganization of the Company (or similar transaction involving the Company), in which the holders of the Common Stock immediately prior to the transaction have voting control over less than fifty-one percent (51%) of the voting securities of the surviving corporation immediately after such transaction, or (B) the sale or disposition of all or substantially all the assets of the Company; or

(iii) The date there shall have been a change in a majority of the Board of Directors of the Company within a 12-month period unless the nomination for election by the Company’s shareholders of each new Director was approved by the vote of two-thirds of the members of the Board (or a committee of the Board, if nominations are approved by a Board committee rather than the Board) then still in office who were in office at the beginning of the 12-month period.

(For the purposes herein, the term “person” shall mean any individual, corporation, partnership, group, association or other person, as such term is defined in Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, other than the Company, a Subsidiary of the Company or any employee benefit plan(s) sponsored or maintained by the Company or any Subsidiary thereof, and the term “beneficial owner” shall have the meaning given the term in Rule 13d-3 under the Exchange Act.)

For the purposes of clarity, (i) a transaction shall not constitute a Change of Control if its principal purpose is to change the state of the Company’s incorporation, create a holding company that would be owned in substantially the same proportions by the persons who held the Company’s securities immediately before such transaction or is another transaction of other similar effect; and (ii) in no event shall a firm commitment underwritten public offering of the Common Stock pursuant to an effective registration statement under the Securities Act constitute a Change of Control.

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Rev. April 2018

Notwithstanding the preceding provisions of Section 12(b), in the event that the Award is deemed to be deferred compensation subject to (and not exempt from) the provisions of Code Section 409A, then distributions related to the Award to be made upon a Change of Control may be permitted, in the Administrator's discretion, upon the occurrence of one or more of the following events (as they are defined and interpreted under Code Section 409A): (A) a change in the ownership of the Company; (B) a change in effective control of the Company; or (C) a change in the ownership of a substantial portion of the assets of the Company.

13. Governing Law . Except as otherwise provided in the Plan or herein, this Agreement shall be construed and enforced according to the laws of the State of Georgia, without regard to the conflict of laws provisions of any state, and in accordance with applicable federal laws of the United States. The Company and the Participant agree that any dispute arising from this Agreement shall be resolved only in a state or federal court sitting in Fulton County, Georgia, which shall have exclusive jurisdiction over any such dispute. The Company and the Participant consent to the personal jurisdiction and waive any objection to jurisdiction or venue in any such court.

14. Amendment and Termination; Waiver . Subject to the terms of the Plan, this Agreement may be amended, altered, suspended and/or terminated at any time, prospectively or retroactively, by the Administrator; provided, however, that any such amendment, alteration, suspension or termination of the Award shall not, without the written consent of the Participant, materially adversely affect the rights of the Participant with respect to the Award. Notwithstanding the foregoing, the Administrator shall have unilateral authority to amend the Plan and this Agreement (without Participant consent) to the extent necessary to comply with Applicable Law or changes to Applicable Law (including but in no way limited to Code Section 409A and federal securities laws). The Administrator also shall have unilateral authority to make adjustments to the terms and conditions of the Award in recognition of unusual or nonrecurring events affecting the Company or any Affiliate, or the financial statements of the Company or any Affiliate, or of changes in Applicable Law, or accounting principles, if the Administrator determines that such adjustments are appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan or necessary or appropriate to comply with applicable accounting principles or Applicable Law. The waiver by the Company of a breach of any provision of this Agreement by the Participant shall not operate or be construed as a waiver of any subsequent breach by the Participant.

RSA Agreement (Employees – with Employment Agreement)

Rev. April 2018

withheld shall have a Fair Market Value as of the date that the amount of tax to be withheld is determined as nearly equal as possible to, but not exceeding (unless otherwise permitted by the Administrator in a manner in accordance with Applicable Law and applicable accounting principles), the amount of such obligations being satisfied. Each election must be made in writing to the Administrator in accordance with election procedures established by the Administrator.

16. Administration . The authority to construe and interpret this Agreement and the Plan, and to administer all aspects of the Plan, shall be vested in the Administrator, and the Administrator shall have all powers with respect to this Agreement as are provided in the Plan. Any interpretation of this Agreement by the Administrator and any decision made by it with respect to this Agreement shall be final and binding.

17. Notices . Except as may be otherwise provided by the Plan or determined by the Administrator, any written notices provided for in this Agreement or the Plan shall be in writing and shall be deemed sufficiently given if either hand delivered or if sent by fax or overnight courier, or by postage paid first class mail. Notices sent by mail shall be deemed received three business days after mailed but in no event later than the date of actual receipt. Notices shall be directed, if to the Participant, at the Participant’s address indicated in the Company’s records, or if to the Company, at the Company’s principal office.

18. Severability . If any provision of this Agreement shall be held illegal or invalid for any reason, such illegality or invalidity shall not affect the remaining parts of this Agreement, and this Agreement shall be construed and enforced as if the illegal or invalid provision had not been included. To the extent any provision of this Agreement or a Prohibited Activity (as defined herein) is deemed to be unenforceable as written but could be made enforceable by way of modification or reformation, then it is the intent of the parties that such provision be modified or reformed to make it enforceable to the fullest extent permitted by law.

19. Right of Offset . Notwithstanding any other provision of the Plan or this Agreement, the Company may at any time (subject to any Code Section 409A considerations) reduce the amount of any payment or other benefit otherwise payable to or on behalf of the Participant by the amount of any obligation of the Participant to or on behalf of the Company or an Affiliate that is or becomes due and payable, and, by entering into this Agreement, the Participant shall be deemed to have consented to such reduction.

20. Forfeiture of Award .

(a) Notwithstanding any other provision of this Agreement, if, at any time during the employment or service of the Participant or during the 12-month period following termination of employment or service (regardless of whether such termination was by the Company or the Participant, and whether voluntary or involuntary or with or without Cause or Good Reason), the Participant engages in a Prohibited Activity (as defined herein), then the Award shall immediately be terminated (to the extent not otherwise already terminated) and all of Participant’s rights under this Agreement shall be forfeited in their entirety.

RSA Agreement (Employees – with Employment Agreement)

Rev. April 2018

(b) For the purposes herein, a “Prohibited Activity” shall mean the Participant's violation of any of the Protective Covenants (as defined in the Participant’s Employment Agreement) set forth in Section ___ of the Employment Agreement.

(c) Notwithstanding the provisions of Section 20(a) herein, the waiver by the Company in any one or more instances of any rights afforded to the Company pursuant to the terms of Section 20(a) herein shall not be deemed to constitute a further or continuing waiver of any rights the Company may have pursuant to the terms of this Agreement or the Plan (including but not limited to the rights afforded the Company in Section 19 herein).

21. Compliance with Recoupment, Ownership and Other Policies or Agreements . As a condition to receiving this Award, the Participant agrees that he or she shall abide by all provisions of any equity retention policy, stock ownership guidelines, compensation recovery policy and/or other policies adopted by the Company, each as in effect from time to time and to the extent applicable to the Participant. In addition, the Participant shall be subject to such compensation recovery, recoupment, forfeiture or other similar provisions as may apply to him or her under Applicable Law.

22. Counterparts; Further Instruments . This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. The parties hereto agree to execute such further instruments and to take such further action as may be reasonably necessary to carry out the purposes and intent of this Agreement.

[Signature Page Follows]

RSA Agreement (Employees – with Employment Agreement)

Rev. April 2018

IN WITNESS WHEREOF, this Agreement has been executed in behalf of the Company and by the Participant effective as of the day and year first above written.



ATLANTIC CAPITAL BANCSHARES, INC. By: Printed Name: Title: Attest: Secretary [Corporate Seal]	PARTICIPANT By: Printed Name:

RSA Agreement (Employees – with Employment Agreement)

Rev. April 2018

ATLANTIC CAPITAL BANCSHARES, INC.

2015 STOCK INCENTIVE PLAN

Restricted Stock Award Agreement

(Employees)

SCHEDULE A

Grant Date:

Number of Shares Subject to Award: ______ shares

Restriction Period: The Shares subject to the Award shall vest and be earned in installments, as provided below, subject to the continued employment or service of the Participant and such other terms and conditions as may be imposed by the Plan and the Agreement:



Date of Vesting	Percentage of Shares Vested

ATLANTIC CAPITAL BANCSHARES, INC.
2015 STOCK INCENTIVE PLAN

Restricted Stock Award Agreement
(Employees)

SCHEDULE B

Employment Agreement

[Attached]

RSA Agreement (Employees – with Employment Agreement)

Rev. April 2018

Exhibit 10.3

Restricted Stock Award No. __

ATLANTIC CAPITAL BANCSHARES, INC.
2015 STOCK INCENTIVE PLAN
Restricted Stock Award Agreement
(Employees)

Name of Participant:

Grant Date:

Number of Shares Subject to Award:

THIS AGREEMENT (together with Schedules A and B attached hereto, this “ Agreement ”) is made effective as of the ____ day of __________ (the “ Grant Date ”) between Atlantic Capital Bancshares, Inc., a Georgia corporation (the “ Company ”), and _______________________, an Employee of the Company or an Affiliate (the “ Participant ”).

R E C I T A L S :

2. Grant of Restricted Stock Award .

(b) Subject to the terms of this Agreement and the Plan, the Company hereby grants the Participant, as a matter of separate inducement and agreement in connection with his or her

RSA Agreement (Employees – without Employment Agreement)

Rev. April 2018

employment with or service to the Company, and not in lieu of any salary or other compensation for his or her services, this Award for that number of Shares as is set forth in this Section 2. The Participant expressly acknowledges that the terms of Schedules A and B shall be incorporated herein by reference and shall constitute part of this Agreement.

3. Share Certificates; Dividends and Voting Rights . Subject to the conditions of this Section 3, a certificate or certificates representing the Shares subject to the Award shall be issued in the name of the Participant promptly after the Grant Date. The Participant shall not be deemed to be the holder of any of the Shares subject to the Award and shall not have any rights of a shareholder unless and until certificates for such Shares have been issued to him or her. The Administrator shall require, as a condition to the grant of the Award and the issuance of the Shares, that (a) the Participant deliver the certificate(s) representing all of the Unvested Shares to the Administrator or its designee to be held in escrow until the Award vests and is no longer subject to a substantial risk of forfeiture (in which case the Shares shall be promptly released to the Participant) or is forfeited (in which case the Shares shall be returned to the Company); and/or (b) the Participant deliver to the Company a stock power, endorsed in blank (or similar instrument), relating to the Unvested Shares and in addition to both (a) and (b), the Participant has executed such other agreements required under Section 10(a). Upon the issuance and delivery of a certificate for the Shares, the Participant shall have such rights and incidents of ownership of the Shares acquired pursuant to the Award, including voting rights, as are permitted by the Plan, this Agreement, any other agreements and any Applicable Law; provided, however , that, (a) except as otherwise provided in Section 5(b) herein, any Unvested Shares subject to the Award (and any related voting rights, dividend rights or other rights as a shareholder) shall be forfeited in the event that the employment or service of the Participant terminates (for any reason) prior to the time such Unvested Shares vest, and in the event of such termination or forfeiture, the Participant shall have no rights with respect to the Award or the Unvested Shares; (b) all of the Shares subject to the Award shall be subject to any restrictions applicable under the Plan (including but not limited to the provisions of Section 18 therein), this Agreement and any other applicable agreements; and (c) if any cash or non-cash dividends are declared and paid by the Company with respect to any Shares subject to the Award (to the extent that the Award is not then vested), the Participant shall have dividend rights with respect to such Shares, but such dividend rights shall be subject to the same vesting schedule, forfeiture terms and other restrictions as are applicable to the underlying Shares.

4. Vesting of Award .

RSA Agreement (Employees – without Employment Agreement)

Rev. April 2018

5. Effect of Termination of Employment or Service .

(i) death;

(ii) Disability; or

(iii) Good Reason (as defined in the Participant’s employment agreement with the Company and/or Atlantic Capital Bank (the “ Bank ”), or, if there is no employment agreement defining Good Reason, as defined in Section 5(c) of this Agreement).

(i) a material reduction in the Participant’s base salary;

(ii) the assignment to the Participant of duties or responsibilities materially inconsistent with, or a material diminution in, the Participant’s position, authority, duties or responsibilities; or

(iii) the relocation of the Participant’s principal place of employment by more than 30 miles from the location at which the Participant is stationed.

RSA Agreement (Employees – without Employment Agreement)

Rev. April 2018

Reason shall cease to exist for any event or condition described herein on the 60th day following the later of the occurrence or the Participant’s knowledge thereof, unless the Participant has given the Company written notice thereof prior to such date.

9. Representations and Warranties of Participant . The Participant represents and warrants to the Company that:

(b) Tax Consequences . The Participant acknowledges that he or she is solely responsible and liable for the satisfaction of all taxes and penalties that may arise in connection

RSA Agreement (Employees – without Employment Agreement)

Rev. April 2018

with the Award (including but not limited to any taxes arising under Code Section 409A), and the Company shall not have any obligation to indemnify or otherwise hold the Participant harmless from any or all such taxes. The Participant further acknowledges that the Company has made no warranties or representations to the Participant with respect to the tax consequences (including but not limited to income tax consequences) related to the transactions contemplated by this Agreement, and the Participant is in no manner relying on the Company or its representatives for an assessment of such tax consequences. The Participant acknowledges that there may be adverse tax consequences upon acquisition or disposition of the Shares subject to the Award and that the Participant should consult a tax advisor prior to such acquisition or disposition. The Participant acknowledges that he or she has been advised that he or she should consult with his or her own attorney, accountant and/or tax advisor regarding the decision to enter into this Agreement and the consequences thereof. The Participant also acknowledges that the Company has no responsibility to take or refrain from taking any actions in order to achieve a certain tax result for the Participant.

10. Restrictions on Award and Shares .

(b) Compliance with Applicable Law . The Company may impose such restrictions on the Award, the Shares and any other benefits underlying the Award as it may deem advisable, including without limitation restrictions under the federal securities laws, the requirements of any stock exchange or similar organization and any blue sky, state or foreign securities laws or other laws applicable to such securities. Notwithstanding any other provision of the Plan or this Agreement to the contrary, the Company shall not be obligated to issue, deliver or transfer shares of Common Stock, make any other distribution of benefits or take any other action, unless such delivery, distribution or action is in compliance with Applicable Law (including but not limited to the requirements of the Securities Act). The Company is under no obligation to register the Shares with the Securities and Exchange Commission or to effect compliance with the exemption, registration, qualification or listing requirements of any state securities laws, stock exchange or similar organization, and the Company shall have no liability for any inability or failure to do so. The Company may cause a restrictive legend or legends to be placed on any certificate for Shares issued pursuant to the Award in such form as may be prescribed from time to time by Applicable Law or as may be advised by legal counsel.

RSA Agreement (Employees – without Employment Agreement)

Rev. April 2018

12. Effect of Change of Control .

RSA Agreement (Employees – without Employment Agreement)

Rev. April 2018

or other arrangement shall not be construed to reduce in any way the benefits otherwise provided to the Participant upon a Change of Control as defined in the Plan.

(b) For the purposes herein, except as may be otherwise required, if at all, under Code Section 409A, a “ Change of Control ” shall be deemed to have occurred on the earliest of the following dates:

(For the purposes herein, the term “ person ” shall mean any individual, corporation, partnership, group, association or other person, as such term is defined in Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, other than the Company, a Subsidiary of the Company or any employee benefit plan(s) sponsored or maintained by the Company or any Subsidiary thereof, and the term “ beneficial owner ” shall have the meaning given the term in Rule 13d-3 under the Exchange Act.)

RSA Agreement (Employees – without Employment Agreement)

Rev. April 2018

14. Amendment and Termination; Waiver . Subject to the terms of the Plan, this Agreement may be amended, altered, suspended and/or terminated at any time, prospectively or retroactively, by the Administrator; provided, however , that any such amendment, alteration, suspension or termination of the Award shall not, without the written consent of the Participant, materially adversely affect the rights of the Participant with respect to the Award. Notwithstanding the foregoing, the Administrator shall have unilateral authority to amend the Plan and this Agreement (without Participant consent) to the extent necessary to comply with Applicable Law or changes to Applicable Law (including but in no way limited to Code Section 409A and federal securities laws). The Administrator also shall have unilateral authority to make adjustments to the terms and conditions of the Award in recognition of unusual or nonrecurring events affecting the Company or any Affiliate, or the financial statements of the Company or any Affiliate, or of changes in Applicable Law, or accounting principles, if the Administrator determines that such adjustments are appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan or necessary or appropriate to comply with applicable accounting principles or Applicable Law. The waiver by the Company of a breach of any provision of this Agreement by the Participant shall not operate or be construed as a waiver of any subsequent breach by the Participant.

15. Withholding . The Participant acknowledges that the Company shall require the Participant or other person to pay to the Company in cash the amount of any tax or other amount required by any governmental authority to be withheld and paid over by the Company to such authority for the account of the Participant, and the Participant agrees, as a condition to the grant of the Award and delivery of the Shares or any other benefit, to satisfy such obligations. Notwithstanding the foregoing, the Administrator may in its discretion establish procedures to permit the Participant to satisfy such obligation in whole or in part, and any local, state, federal, foreign or other income tax obligations relating to the Award, by electing (the “ election ”) to deliver to the Company shares of Common Stock held by the Participant (which are fully vested and not subject to any pledge or other security interest) and/or have the Company withhold shares of Common Stock from the Shares to which the Participant is otherwise entitled. The number of shares to be withheld shall have a Fair Market Value as of the date that the amount of tax to be withheld is determined as nearly equal as possible to, but not exceeding (unless otherwise permitted by the Administrator in a manner in accordance with Applicable Law and applicable accounting principles), the amount of such obligations being satisfied. Each election must be made in writing to the Administrator in accordance with election procedures established by the Administrator.

16. Administration . The authority to construe and interpret this Agreement and the Plan, and to administer all aspects of the Plan, shall be vested in the Administrator, and the Administrator

RSA Agreement (Employees – without Employment Agreement)

Rev. April 2018

shall have all powers with respect to this Agreement as are provided in the Plan. Any interpretation of this Agreement by the Administrator and any decision made by it with respect to this Agreement shall be final and binding.

20. Forfeiture of Award .

(b) For the purposes herein, a “ Prohibited Activity ” shall have the meaning set forth on Schedule B attached hereto.

(c) The Participant acknowledges that compliance with the provisions of this Section 20 is a condition precedent to the Participant’s rights under this Agreement. The Participant further acknowledges and agrees that, by entering into this Agreement, the Participant agrees to be bound by the covenants contained in Schedule B for the durations and pursuant to the terms set forth therein regardless of whether the Participant’s rights under this Agreement have been forfeited because of a violation of the covenants or otherwise.

RSA Agreement (Employees – without Employment Agreement)

Rev. April 2018

(d) Notwithstanding the provisions of Section 20(a) herein, the waiver by the Company in any one or more instances of any rights afforded to the Company pursuant to the terms of Section 20(a) herein shall not be deemed to constitute a further or continuing waiver of any rights the Company may have pursuant to the terms of this Agreement or the Plan (including but not limited to the rights afforded the Company in Section 19 herein).

[Signature Page Follows]

RSA Agreement (Employees – without Employment Agreement)

Rev. April 2018

IN WITNESS WHEREOF, this Agreement has been executed in behalf of the Company and by the Participant effective as of the day and year first above written.



ATLANTIC CAPITAL BANCSHARES, INC. By: Printed Name: Title: Attest: Secretary [Corporate Seal]	PARTICIPANT By: Printed Name:

RSA Agreement (Employees – without Employment Agreement)

Rev. April 2018

ATLANTIC CAPITAL BANCSHARES, INC.
2015 STOCK INCENTIVE PLAN

Restricted Stock Award Agreement
(Employees)

SCHEDULE A

Grant Date:

Number of Shares Subject to Award: ______ shares


Restriction Period:	The Shares subject to the Award shall vest and be earned in installments, as provided below, subject to the continued employment or service of the Participant and such other terms and conditions as may be imposed by the Plan and the Agreement:



Date of Vesting	Percentage of Shares Vested

RSA Agreement (Employees – without Employment Agreement)

Rev. April 2018

ATLANTIC CAPITAL BANCSHARES, INC.
2015 STOCK INCENTIVE PLAN

Restricted Stock Award Agreement
(Employees)

SCHEDULE B

“Prohibited Activity”

A “ Prohibited Activity ” shall be any violation of any one or more than one of the protective covenants set forth hereafter:

1. Confidential Information and Trade Secrets . During the Participant’s employment, the parties acknowledge that the Company and/or Atlantic Capital Bank, N.A. (collectively, the “ Employers ”) shall disclose, or have already disclosed, to the Participant for use in the Participant’s employment, and the Participant shall be provided access to and otherwise shall make use of, acquire, create, or add to certain valuable, unique, proprietary, and secret information of the Employers (whether tangible or intangible and whether or not electronically kept or stored), including financial statements, drawings, designs, manuals, business plans, processes, procedures, formulas, inventions, pricing policies, customer and prospect lists and contacts, contracts, sources and identity of vendors and contractors, financial information of customers of the Employers, and other proprietary documents, materials, or information indigenous to the Employers, relating to their businesses and activities, or the manner in which the Employers do business, which is valuable to the Employers in conducting their business because the information is kept confidential and is not generally known to the Employers’ competitors or to the general public (“ Confidential Information ”). Confidential Information does not include information generally known or easily obtained from public sources or public records, unless the Participant causes the Confidential Information to become generally known or easily obtained from public sources or public records.

a. To the extent that the Confidential Information rises to the level of a trade secret under Applicable Law, then the Participant shall, during the Participant’s employment and for so long as the Confidential Information remains a trade secret under Applicable Law (or for the maximum period of time otherwise allowed by Applicable Law) (i) protect and maintain the confidentiality of such trade secrets and (ii) refrain from disclosing, copying, or using any such trade secrets, without the Employers’ prior written consent, except as necessary in the Participant’s performance of the Participant’s duties while employed with the Employers.

b. To the extent that the Confidential Information defined above does not rise to the level of a trade secret under Applicable Law, the Participant shall, during the Participant’s employment and for so long as such information remains confidential following any voluntary or involuntary termination of employment (whether by the Employers or Participant), (i) protect and maintain the confidentiality of the Confidential Information and (ii) refrain from disclosing, copying, or using any Confidential Information without the Employers’ prior written consent, except as necessary in the Participant’s performance of the Participant’s duties while employed with the Employers.

RSA Agreement (Employees – without Employment Agreement)

Rev. April 2018

2. Return of Property of the Employers . Upon any voluntary or involuntary termination of the Participant’s employment (or at any time upon request of the Employers), the Participant agrees to immediately return to the Employers all property of the Employers (including, without limitation, all documents, electronic files, records, computer disks or other tangible or intangible things that may or may not relate to or otherwise comprise Confidential Information or trade secrets, as defined by Applicable Law) that the Participant created, used, possessed or maintained while working for the Employers from whatever source and whenever created, including all reproductions or excerpts thereof. This provision does not apply to purely personal documents of the Participant, but it does apply to business calendars, customer lists, contact information, computer programs, disks and their contents and like information that may contain some personal matters of the Participant. The Participant acknowledges that title to all such property is vested in the Employers.

3. Non-Diversion of Business Opportunity . During the Participant’s employment with the Employers and consistent with the Participant’s duties and fiduciary obligations to the Employers, the Participant shall (a) disclose to the Employers any business opportunity that comes to the Participant’s attention during the Participant’s employment with the Employers and that relates to the business of the Employers or otherwise arises as a result of the Participant’s employment with the Employers and (b) not take advantage of or otherwise divert any such opportunity for the Participant’s own benefit or that of any other person or entity without prior written consent of the Employers.

4. Non-Solicitation of Customers . During the Participant’s employment and for a period of twelve ( 12 ) months following any employment termination, the Participant agrees not to, directly or indirectly, contact, solicit, divert, appropriate, or call upon, with the intent of doing business with, the customers or clients of the Employers with whom the Participant has had material contact (as such term is defined by Georgia’s Restrictive Covenants Act) during the last year of the Participant’s employment with the Employers, including prospects of the Employers with whom the Participant had such contact during said last year of the Participant’s employment, if the purpose of such activity is either (a) to solicit such customers or clients or prospective customers or clients for a Competitive Business as herein defined (including, without limitation, any Competitive Business started by the Participant) or (b) to otherwise encourage any such customer or client to discontinue, reduce, or adversely alter the amount of its business with the Employers. The Participant acknowledges that, due to the Participant’s relationship with the Employers, the Participant shall develop, or has developed, special contacts and relationships with the Employers’ clients and prospects, and that it would be unfair and harmful to the Employers if the Participant took advantage of these relationships.

5. Competitive Business . A “ Competitive Business ”, as defined in this Agreement, is an enterprise that is in the business of offering banking products and/or services, which services and/or products are similar or substantially identical to those offered by the Employers during the Participant’s employment with the Employers.

6. Non-Piracy of Employees . During the Participant’s employment and for a period of twelve ( 12 ) months following any termination, the Participant covenants and agrees that the Participant

RSA Agreement (Employees – without Employment Agreement)

Rev. April 2018

shall not, within the Territory, directly or indirectly: (a) solicit, recruit, or hire (or attempt to solicit, recruit, or hire) or otherwise assist anyone in soliciting, recruiting, or hiring, any employee or independent contractor (which shall not include non-exclusive outside vendors) of the Employers who performed work for the Employers within the last six ( 6 ) months of the Participant’s employment with the Employers or who was otherwise engaged or employed with the Employers at the time of said termination of employment of the Participant or (b) otherwise encourage, solicit, or support any such employees or independent contractors to leave their employment or engagement with the Employers, in either case until such employee or contractor has been terminated or separated from the Employers for at least twelve ( 12 ) months.

7. Non-Compete . During the Participant’s employment and for a period of twelve ( 12 ) months following any employment termination, the Participant agrees not to, directly or indirectly, compete with the Employers, as an officer, director, member, principal, partner, shareholder (other than a shareholder in a company that is publicly traded and so long as such ownership is less than five percent ( 5% )), owner, manager, supervisor, administrator, employee, consultant, or independent contractor, by working in the Territory (as defined herein) for or as a “Competitive Business” (as defined above) in the Territory (as defined herein), in a capacity identical or substantially similar to the capacity in which the Participant served at the Employers. The “ Territory ” shall be defined as (i) the following counties in the State of Georgia: Barrow; Bartow; Butts; Carroll; Cherokee; Clayton; Cobb; Coweta; Dawson; DeKalb; Douglas; Fayette; Forsyth; Fulton; Gwinnett; Haralson; Heard; Henry; Jasper; Lamar; Meriwether; Newton; Paulding; Pickens; Pike; Rockdale; Spalding; and Walton, as well as (ii) the area within the city limits of Chattanooga, Tennessee, Knoxville, Tennessee and Charlotte, North Carolina as well as (iii) each county within which Chattanooga, Tennessee, Knoxville, Tennessee and Charlotte, North Carolina are located, as well as (iv) the counties (including those in adjacent states, if any) that are immediately contiguous to the counties referenced in subpart (iii), as well as (v) any counties of any state in which the Employers, at the time of termination of the Participant’s employment, are operating or providing services, or in which the Employers have plans to solicit or engage in business, which plans are known to the Participant during the term of the Participant’s employment; provided, however, that the Territory described herein is a good faith estimate of the geographic area that is now applicable or that may be applicable at the termination of the Participant’s employment as the areas in which the Employers do or shall do business during the term of the Participant’s employment, and the Employers and the Participant agree that this non-compete covenant shall ultimately be construed to cover only so much of such estimate as relates to the geographic areas in which the Employers do business within the two-year period preceding termination of the Participant’s employment.

RSA Agreement (Employees – without Employment Agreement)

Rev. April 2018

does not limit the Participant’s right to receive an award for providing information relating to a possible securities law violation to the Securities and Exchange Commission. Further, notwithstanding the foregoing, the Participant shall not be held criminally or civilly liable under any federal, state or local trade secret law for the disclosure of a trade secret that (x) is made (A) in confidence to a federal, state or local official, either directly or indirectly, or to an attorney; and (B) solely for the purpose of reporting or investigating a suspected violation or law; or (y) is made in a compliant or other document filed in a lawsuit or other proceeding, if such filing is made under seal. Additionally, an individual suing an employer for retaliation based on the reporting of a suspected violation of law may disclose a trade secret to his or her attorney and use the trade secret information in the court proceeding, so long as any document containing the trade secret is filed under seal and the individual does not disclose the trade secret except pursuant to court order. The rights described in this Section 8 are referred to in this Agreement as the “ Protected Rights .”

9. Acknowledgment .

a. It is understood and agreed by the Participant that the parties have attempted to limit his or her right to compete only to the extent necessary to protect the Employers from unfair competition and that the terms and provisions of Schedule B of this Agreement are not intended to restrict the Participant in the exercise of his or her skills or the use of knowledge or information that does not rise to the level of a trade secret under Applicable Law or Confidential Information of the Employers (to which trade secrets and Confidential Information the Participant has had and/or shall have access and has made and/or shall make use of during employment with the Employers).

b. It is further acknowledged that the purpose of these covenants and promises is (and that they are necessary) to protect the Employers’ legitimate business interests, to protect the Employers’ investment in the overall development of its business and the good will of its customers, and to protect and retain (and to prevent the Participant from unfairly and to the detriment of the Employers utilizing or taking advantage of) such business trade secrets and Confidential Information of the Employers and those substantial contacts and relationships (including those with customers and employees of the Employers) which the Participant established due to his or her employment with the Employers.

c. This Agreement is not intended to preclude the Participant’s opportunity to engage in or otherwise pursue occupations in any unrelated or non-competitive field of endeavor, or to engage in or otherwise pursue directly competitive endeavors so long as they meet the requirements of this Agreement.

d. The Participant acknowledges that these covenants and promises (and their respective time, geographic, and/or activity limitations) are reasonable and that said limitations are no greater than necessary to protect said legitimate business interests in light of the Participant’s position with the Employers and the Employers’ business, and the Participant agrees to strictly abide by the terms hereof. If any provision of this Agreement is ruled invalid or unenforceable by a court of competent jurisdiction because of a conflict between the provision and any Applicable Law or public policy, the provision shall be redrawn to make the provision consistent with, and valid and enforceable under, the law or public policy.

RSA Agreement (Employees – without Employment Agreement)

Rev. April 2018

Exhibit 10.4

Restricted Stock Unit Award No. ___

ATLANTIC CAPITAL BANCSHARES, INC.

2015 STOCK INCENTIVE PLAN

Restricted Stock Unit Agreement

(Employees)

Name of Participant:

Grant Date:

Number of Shares Subject to Award:

THIS AGREEMENT (together with Schedules A and B attached hereto, this “ Agreement ”) is made effective as of the ____ day of ___________, _____ (the “ Grant Date ”) between Atlantic Capital Bancshares, Inc., a Georgia corporation (the “ Company ”), and ___________________________, an Employee of the Company or an Affiliate (the “ Participant ”).

R E C I T A L S :

2. Grant of Award of Restricted Stock Units .

(a) The number of shares of the Company’s common stock (the “ Common Stock ”) subject to the Restricted Stock Units (the “ Award ”) granted under this Agreement shall be ________________ shares (the “ Shares ”).

(b) The “ Restriction Period ” is the period beginning on the Grant Date and ending on such date or dates and satisfaction of such conditions as described in Schedule A, which is attached hereto and expressly made a part of this Agreement.

RSU Agreement (Employees – with Employment Agreement)

Rev. April 2018

(c) Subject to the terms of this Agreement and the Plan, the Company hereby grants the Participant, as a matter of separate inducement and agreement in connection with his or her employment with or service to the Company, and not in lieu of any salary or other compensation for his or her services, this Award for that number of Shares as is set forth in this Section 2. The Participant expressly acknowledges that the terms of Schedules A and B shall be incorporated herein by reference and shall constitute part of this Agreement.

3. No Rights as a Shareholder . The Participant shall not be deemed to be the holder of any of the Shares subject to the Award and shall not have any rights of a shareholder unless and until (and then only to the extent that) the Award has vested and certificates for such Shares have been issued and delivered to him or her (or, in the case of uncertificated shares, other written evidence of ownership in accordance with Applicable Law shall have been provided); provided, however, that if any cash or non-cash dividends are declared and paid by the Company with respect to any Shares subject to the Award (to the extent that the Award is not then vested), the Participant shall have dividend equivalent rights with respect to such Shares, but such dividend equivalent rights shall be subject to the same vesting schedule, forfeiture terms and other restrictions as are applicable to the underlying Shares.

4. Vesting of Award .

(a) Subject to the terms of the Plan and this Agreement, including but not limited to Section 5 and Section 13 herein, the Award shall vest and be earned, and the Shares subject to the Award shall be distributable as provided in Section 6 herein, upon such date or dates, and subject to such conditions, as are described on Schedule A, which is attached hereto and expressly made a part of this Agreement. Without limiting the effect of the foregoing, the Shares subject to the Award may vest in installments over a period of time, if so provided in Schedule A. The Participant expressly acknowledges that the Award shall vest only upon such terms and conditions as are provided in this Agreement (including but not limited to Schedule A) and otherwise in accordance with the terms of the Plan. Notwithstanding anything to the contrary herein, the Protective Covenants contained in the Agreement between the Participant and the Company dated ___________________, 20____ (the “ Employment Agreement ”), a copy of which is attached hereto as Schedule B and incorporated herein by reference, shall remain in full force and effect according to their terms regardless of whether the Participant’s rights under this Agreement have vested or not or have been forfeited or not.

5. Effect of Termination of Employment or Service .

RSU Agreement (Employees – with Employment Agreement)

Rev. April 2018

then the Award, to the extent not vested or earned as of the Participant’s Termination Date, shall be forfeited immediately upon such termination, and the Participant shall have no further rights with respect to the Award or the Shares underlying that portion of the Award that has not yet been earned and vested. The Participant expressly acknowledges and agrees that the termination of his or her employment or service shall (except as may otherwise be provided in this Agreement or in the Plan) result in forfeiture of the Award and the Shares to the extent that the Award has not been earned and vested as of his or her Termination Date.

(i) death;

(ii) Disability;

(iii) Retirement; or

(iv) Good Reason (as defined in the Participant’s Employment Agreement, or, if there is no Employment Agreement defining Good Reason, as defined in Section 5(c) of this Agreement).

(i) a material reduction in the Participant’s base salary;

(ii) the assignment to the Participant of duties or responsibilities materially inconsistent with, or a material diminution in, the Participant’s position, authority, duties or responsibilities; or

(iii) the relocation of the Participant’s principal place of employment by more than 30 miles from the location at which the Participant is stationed.

An event or condition that would otherwise constitute “Good Reason” shall constitute Good Reason only if the Company fails to rescind or cure such event or condition within 30 days after receipt from the Participant of written notice of the event which constitutes Good Reason, and Good Reason shall cease to exist for any event or condition described herein on the 60 ^th day following the later of the occurrence or the Participant’s knowledge thereof, unless the Participant has given the Company written notice thereof prior to such date.

RSU Agreement (Employees – with Employment Agreement)

Rev. April 2018

6. Settlement of Award . The Award, if earned in accordance with the terms of this Agreement, shall be payable in whole shares of Common Stock. The total number of Shares that may be acquired upon vesting of the Award (or portion thereof) shall be rounded down to the nearest whole share. A certificate or certificates for the Shares subject to the Award or portion thereof shall be issued in the name of the Participant or his or her beneficiary (or, in the case of uncertificated shares, other written evidence of ownership in accordance with Applicable Law shall be provided) within 70 days following the date the Award or portion thereof has been earned and vested in accordance with the terms of this Agreement. If the 70-day period described herein begins in one calendar year and ends in another, the Participant (or his beneficiary) shall not have the right to designate the calendar year of the distribution (except as otherwise provided below with respect to a delay in distribution if the Participant is a “specified employee”). Notwithstanding the foregoing, if the Participant is or may be a “specified employee” (as defined under Code Section 409A), and the distribution is considered deferred compensation under Code Section 409A, then such distribution if made due to separation from service shall be subject to delay as provided in Section 21 of the Plan (or any successor provision thereto).

7. No Right of Continued Employment or Service; Forfeiture of Award; No Right to Future Awards . Neither the Plan, this Agreement, the grant of the Award nor any other action related to the Plan shall confer upon the Participant any right to continue in the employ or service of the Company or an Affiliate or to interfere in any way with the right of the Company or an Affiliate to terminate the Participant’s employment or service at any time. Except as otherwise provided in the Plan or this Agreement or as may be determined by the Administrator, all rights of the Participant with respect to the unvested portion of the Award shall terminate upon termination of the Participant’s employment or service with the Company or an Affiliate. The Participant acknowledges and agrees that the Company has no obligation to advise the Participant of the expiration of the Award. The grant of the Award does not create any obligation to grant further awards.

8. Nontransferability of Award and Shares . The Award shall not be transferable (including by sale, assignment, pledge or hypothecation) other than transfers by will or the laws of intestate succession, and the Participant or other recipient of the Award shall not sell, transfer, assign, pledge or otherwise encumber the Shares subject to the Award until the Restriction Period has expired and all conditions to vesting have been met. The designation of a beneficiary in accordance with the Plan does not constitute a transfer.

9. Superseding Agreement; Binding Effect . This Agreement supersedes any statements, representations or agreements of the Company with respect to the grant of the Award, and the Participant hereby waives any rights or claims related to any such statements, representations or agreements. This Agreement does not supersede or amend any existing confidentiality agreement, non-competition agreement, non-solicitation agreement, employment agreement, consulting agreement or any other similar agreement between the Participant and the Company, including but not limited to any restrictive covenants contained in such agreements, which shall remain in full force and effect and enforceable in accordance with their terms. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective executors, administrators, next-of-kin, successors and assigns.

RSU Agreement (Employees – with Employment Agreement)

Rev. April 2018

10. Representations and Warranties of Participant . The Participant represents and warrants to the Company that:

11. Restrictions on Award and Shares .

RSU Agreement (Employees – with Employment Agreement)

Rev. April 2018

distribution or action is in compliance with Applicable Law (including but not limited to the requirements of the Securities Act). The Company is under no obligation to register the Shares with the Securities and Exchange Commission or to effect compliance with the exemption, registration, qualification or listing requirements of any state securities laws, stock exchange or similar organization, and the Company shall have no liability for any inability or failure to do so. The Company may cause a restrictive legend or legends to be placed on any certificate for Shares issued pursuant to the Award in such form as may be prescribed from time to time by Applicable Law or as may be advised by legal counsel.

12. Certain Changes in Status . The Participant acknowledges that the Administrator has the sole discretion to determine (taking into account any Code Section 409A considerations), at any time, the effect, if any, on the Award (including but not limited to modifying the vesting and/or earning of the Award) of any changes in the Participant’s status (other than termination) as an Employee, including but not limited to a change from full-time to part-time, or vice versa, or other similar changes in the nature or scope of the Participant’s employment or service.

13. Effect of Change of Control.

(ii) Further, in the event that the Award is substituted, assumed or continued as provided in Section 13(a) herein, the Award shall nonetheless become vested in full and any restrictions, including but not limited to the Restriction Period, Performance Period and/or performance criteria applicable to the Award shall be deemed to have been met, and the Award shall become fully vested, earned and payable to the fullest extent of the original award (or, if the Award is performance-based and the earning of which is based on attaining a target level of performance, the Award shall be deemed earned at target), if the employment or service of the Participant is terminated within six months before (in which case vesting shall not occur until the effective date of the Change of Control) or one year (or such other period after a Change of Control as may be stated in a Participant’s employment, change of control, consulting or other similar agreement, if applicable) after the effective date of a Change of Control if such termination of employment or service (i) is by the Company not

RSU Agreement (Employees – with Employment Agreement)

Rev. April 2018

for Cause or (ii) is by the Participant for Good Reason. For clarification, for the purposes of this Section 13, the “Company” shall include any successor to the Company.

(For the purposes herein, the term “ person ” shall mean any individual, corporation, partnership, group, association or other person, as such term is defined in Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, other than the Company, a Subsidiary of the Company or any employee benefit plan(s) sponsored or maintained by the Company or any Subsidiary thereof, and the term “ beneficial owner ” shall have the meaning given the term in Rule 13d-3 under the Exchange Act.)

RSU Agreement (Employees – with Employment Agreement)

Rev. April 2018

Notwithstanding the preceding provisions of Section 13(b), in the event that the Award is deemed to be deferred compensation subject to (and not exempt from) the provisions of Code Section 409A, then distributions related to the Award to be made upon a Change of Control may be permitted, in the Administrator's discretion, upon the occurrence of one or more of the following events (as they are defined and interpreted under Code Section 409A): (A) a change in the ownership of the Company; (B) a change in effective control of the Company; or (C) a change in the ownership of a substantial portion of the assets of the Company.

14. Governing Law . Except as otherwise provided in the Plan or herein, this Agreement shall be construed and enforced according to the laws of the State of Georgia, without regard to the conflict of laws provisions of any state, and in accordance with applicable federal laws of the United States. The Company and the Participant agree that any dispute arising from this Agreement shall be resolved only in a state or federal court sitting in Fulton County, Georgia, which shall have exclusive jurisdiction over any such dispute. The Company and the Participant consent to the personal jurisdiction and waive any objection to jurisdiction or venue in any such court.

15. Amendment and Termination; Waiver . Subject to the terms of the Plan, this Agreement may be amended, altered, suspended and/or terminated at any time, prospectively or retroactively, by the Administrator; provided, however, that any such amendment, alteration, suspension or termination of the Award shall not, without the written consent of the Participant, materially adversely affect the rights of the Participant with respect to the Award. Notwithstanding the foregoing, the Administrator shall have unilateral authority to amend the Plan and this Agreement (without Participant consent) to the extent necessary to comply with Applicable Law or changes to Applicable Law (including but in no way limited to Code Section 409A and federal securities laws). The Administrator also shall have unilateral authority to make adjustments to the terms and conditions of the Award in recognition of unusual or nonrecurring events affecting the Company or any Affiliate, or the financial statements of the Company or any Affiliate, or of changes in Applicable Law, or accounting principles, if the Administrator determines that such adjustments are appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan or necessary or appropriate to comply with applicable accounting principles or Applicable Law. The waiver by the Company of a breach of any provision of this Agreement by the Participant shall not operate or be construed as a waiver of any subsequent breach by the Participant.

RSU Agreement (Employees – with Employment Agreement)

Rev. April 2018

17. Administration . The authority to construe and interpret this Agreement and the Plan, and to administer all aspects of the Plan, shall be vested in the Administrator, and the Administrator shall have all powers with respect to this Agreement as are provided in the Plan. Any interpretation of this Agreement by the Administrator and any decision made by it with respect to this Agreement shall be final and binding.

18. Notices . Except as may be otherwise provided by the Plan or determined by the Administrator, any written notices provided for in this Agreement or the Plan shall be in writing and shall be deemed sufficiently given if either hand delivered or if sent by fax or overnight courier, or by postage paid first class mail. Notices sent by mail shall be deemed received three business days after mailed but in no event later than the date of actual receipt. Notices shall be directed, if to the Participant, at the Participant’s address indicated in the Company’s records, or if to the Company, at the Company’s principal office.

19. Severability . If any provision of this Agreement shall be held illegal or invalid for any reason, such illegality or invalidity shall not affect the remaining parts of this Agreement, and this Agreement shall be construed and enforced as if the illegal or invalid provision had not been included. To the extent any provision of this Agreement or a Prohibited Activity (as defined herein) is deemed to be unenforceable as written but could be made enforceable by way of modification or reformation, then it is the intent of the parties that such provision be modified or reformed to make it enforceable to the fullest extent permitted by law.

20. Right of Offset . Notwithstanding any other provision of the Plan or this Agreement, the Company may at any time (subject to any Code Section 409A considerations) reduce the amount of any payment or other benefit otherwise payable to or on behalf of the Participant by the amount of any obligation of the Participant to or on behalf of the Company or an Affiliate that is or becomes due and payable, and, by entering into this Agreement, the Participant shall be deemed to have consented to such reduction.

RSU Agreement (Employees – with Employment Agreement)

Rev. April 2018

21. Forfeiture of Award .

(a) Notwithstanding any other provision of this Agreement, if, at any time during the employment or service of the Participant or during the 12-month period following termination of employment or service (regardless of whether such termination was by the Company or the Participant, and whether voluntary or involuntary or with or without Cause or Good Reason), the Participant engages in a Prohibited Activity (as defined herein), then the Award shall immediately be terminated to the extent not otherwise already terminated and all of Participant’s rights under this Agreement shall be forfeited in their entirety.

(b) For the purposes herein, a “Prohibited Activity” shall mean the Participant’s violation of any of the Protective Covenants (as defined in the Participant’s Employment Agreement) set forth in Section ____ of the Employment Agreement.

(c) Notwithstanding the provisions of Section 21(a) herein, the waiver by the Company in any one or more instances of any rights afforded to the Company pursuant to the terms of Section 21(a) herein shall not be deemed to constitute a further or continuing waiver of any rights the Company may have pursuant to the terms of this Agreement or the Plan (including but not limited to the rights afforded the Company in Section 20 herein).

22. Compliance with Recoupment, Ownership and Other Policies or Agreements . As a condition to receiving this Award, the Participant agrees that he or she shall abide by all provisions of any equity retention policy, stock ownership guidelines, compensation recovery policy and/or other policies adopted by the Company, each as in effect from time to time and to the extent applicable to the Participant. In addition, the Participant shall be subject to such compensation recovery, recoupment, forfeiture or other similar provisions as may apply to him or her under Applicable Law.

23. Counterparts; Further Instruments . This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. The parties hereto agree to execute such further instruments and to take such further action as may be reasonably necessary to carry out the purposes and intent of this Agreement.

[Signature Page Follows]

RSU Agreement (Employees – with Employment Agreement)

Rev. April 2018

IN WITNESS WHEREOF, this Agreement has been executed in behalf of the Company and by the Participant effective as of the day and year first above written.



ATLANTIC CAPITAL BANCSHARES, INC. By: Printed Name: Title: Attest: Secretary [Corporate Seal]	PARTICIPANT By: Printed Name:

RSU Agreement (Employees – with Employment Agreement)

Rev. April 2018

ATLANTIC CAPITAL BANCSHARES, INC.

2015 STOCK INCENTIVE PLAN

Restricted Stock Unit Agreement
(Employees)

SCHEDULE A

Grant Date:

Number of Shares Subject to Award: ______ shares


Restriction Period:	The Shares subject to the Award shall vest and be earned in installments, as provided below, subject to the continued employment or service of the Participant and such other terms and conditions as may be imposed by the Plan and the Agreement:



Date of Vesting	Percentage Vested

RSU Agreement (Employees – with Employment Agreement)

Rev. April 2018

ATLANTIC CAPITAL BANCSHARES, INC.
2015 STOCK INCENTIVE PLAN

Restricted Stock Unit Agreement
(Employees)

SCHEDULE B

Employment Agreement

[Attached]

RSU Agreement (Employees – with Employment Agreement)

Rev. April 2018

Exhibit 10.5

Restricted Stock Unit Award No. __

ATLANTIC CAPITAL BANCSHARES, INC.
2015 STOCK INCENTIVE PLAN
Restricted Stock Unit Agreement
(Employees)

Name of Participant:

Grant Date:

Number of Shares Subject to Award:

THIS AGREEMENT (together with Schedules A and B attached hereto, this “ Agreement ”) is made effective as of the ____ day of __________, _____ (the “ Grant Date ”) between Atlantic Capital Bancshares, Inc., a Georgia corporation (the “Company”), and ___________________________, an Employee of the Company or an Affiliate (the “ Participant ”).

R E C I T A L S :

2. Grant of Award of Restricted Stock Units .

RSU Agreement (Employees – without Employment Agreement)

Rev. April 2018

Participant expressly acknowledges that the terms of Schedules A and B shall be incorporated herein by reference and shall constitute part of this Agreement.

4. Vesting of Award .

5. Effect of Termination of Employment or Service .

(a) Except as otherwise provided in this Section 5 or in Section 13 herein, if the employment or service of the Participant is terminated for any reason (whether by the Company or the Participant and whether voluntary or involuntary or with or without Cause) (such date of termination of employment or service being referred to as the “ Termination Date ”) and all or any part of the Award has not vested or been earned pursuant to the terms of the Plan and this Agreement, then the Award, to the extent not vested or earned as of the Participant’s Termination Date, shall be forfeited immediately upon such termination, and the Participant shall have no further rights with respect to the Award or the Shares underlying that portion of the Award that has not yet been earned and vested. The Participant expressly acknowledges and agrees that the termination of his or her employment or service shall (except as may otherwise be provided in this Agreement or in the Plan) result in forfeiture of the Award and the Shares to the extent that the Award has not been earned and vested as of his or her Termination Date.

RSU Agreement (Employees – without Employment Agreement)

Rev. April 2018

(i) death;

(ii) Disability;

(iii) Retirement; or

(iv) Good Reason (as defined in the Participant’s employment agreement with the Company and/or Atlantic Capital Bank (the “ Bank ”), or, if there is no employment agreement defining Good Reason, as defined in Section 5(c) of this Agreement).

(i) a material reduction in the Participant’s base salary;

(ii) the assignment to the Participant of duties or responsibilities materially inconsistent with, or a material diminution in, the Participant’s position, authority, duties or responsibilities; or

(iii) the relocation of the Participant’s principal place of employment by more than 30 miles from the location at which the Participant is stationed.

RSU Agreement (Employees – without Employment Agreement)

Rev. April 2018

year of the distribution (except as otherwise provided below with respect to a delay in distribution if the Participant is a “specified employee”). Notwithstanding the foregoing, if the Participant is or may be a “specified employee” (as defined under Code Section 409A), and the distribution is considered deferred compensation under Code Section 409A, then such distribution if made due to separation from service shall be subject to delay as provided in Section 21 of the Plan (or any successor provision thereto).

10. Representations and Warranties of Participant . The Participant represents and warrants to the Company that:

RSU Agreement (Employees – without Employment Agreement)

Rev. April 2018

Company shall not have any obligation to indemnify or otherwise hold the Participant harmless from any or all such taxes. The Participant further acknowledges that the Company has made no warranties or representations to the Participant with respect to the tax consequences (including but not limited to income tax consequences) related to the transactions contemplated by this Agreement, and the Participant is in no manner relying on the Company or its representatives for an assessment of such tax consequences. The Participant acknowledges that there may be adverse tax consequences upon acquisition or disposition of the Shares subject to the Award and that the Participant should consult a tax advisor prior to such acquisition or disposition. The Participant acknowledges that he or she has been advised that he or she should consult with his or her own attorney, accountant and/or tax advisor regarding the decision to enter into this Agreement and the consequences thereof. The Participant also acknowledges that the Company has no responsibility to take or refrain from taking any actions in order to achieve a certain tax result for the Participant.

11. Restrictions on Award and Shares .

RSU Agreement (Employees – without Employment Agreement)

Rev. April 2018

13. Effect of Change of Control .

RSU Agreement (Employees – without Employment Agreement)

Rev. April 2018

or other arrangement shall not be construed to reduce in any way the benefits otherwise provided to the Participant upon a Change of Control as defined in the Plan.

(b) For the purposes herein, except as may be otherwise required, if at all, under Code Section 409A, a “ Change of Control ” shall be deemed to have occurred on the earliest of the following dates:

(For the purposes herein, the term “ person ” shall mean any individual, corporation, partnership, group, association or other person, as such term is defined in Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, other than the Company, a Subsidiary of the Company or any employee benefit plan(s) sponsored or maintained by the Company or any Subsidiary thereof, and the term “ beneficial owner ” shall have the meaning given the term in Rule 13d-3 under the Exchange Act.)

RSU Agreement (Employees – without Employment Agreement)

Rev. April 2018

16. Withholding . The Participant acknowledges that the Company shall require the Participant or other person to pay to the Company in cash the amount of any tax or other amount required by any governmental authority to be withheld and paid over by the Company to such authority for the account of the Participant, and the Participant agrees, as a condition to the grant of the Award and delivery of the Shares or any other benefit, to satisfy such obligations. Notwithstanding the foregoing, the Administrator may in its discretion establish procedures to permit the Participant to satisfy such obligation in whole or in part, and any local, state, federal, foreign or other income tax obligations relating to the Award, by electing (the “ election ”) to deliver to the Company shares of Common Stock held by the Participant (which are fully vested and not subject to any pledge or other security interest) and/or have the Company withhold shares of Common Stock from the Shares to which the Participant is otherwise entitled. The number of shares to be withheld shall have a Fair Market Value as of the date that the amount of tax to be withheld is determined as nearly equal as possible to, but not exceeding (unless otherwise permitted by the Administrator in a manner in accordance with Applicable Law and applicable accounting principles), the amount of such obligations being satisfied. Each election must be made in writing to the Administrator in accordance with election procedures established by the Administrator.

17. Administration . The authority to construe and interpret this Agreement and the Plan, and to administer all aspects of the Plan, shall be vested in the Administrator, and the Administrator

RSU Agreement (Employees – without Employment Agreement)

Rev. April 2018

21. Forfeiture of Award .

(b) For the purposes herein, a “ Prohibited Activity ” shall have the meaning set forth on Schedule B attached hereto.

(c) The Participant acknowledges that compliance with the provisions of this Section 21 is a condition precedent to the Participant’s rights under this Agreement. The Participant further acknowledges and agrees that, by entering into this Agreement, the Participant agrees to be bound by the covenants contained in Schedule B for the durations and pursuant to the terms set forth therein regardless of whether the Participant’s rights under this Agreement have been forfeited because of a violation of the covenants or otherwise.

RSU Agreement (Employees – without Employment Agreement)

Rev. April 2018

(d) Notwithstanding the provisions of Section 21(a) herein, the waiver by the Company in any one or more instances of any rights afforded to the Company pursuant to the terms of Section 21(a) herein shall not be deemed to constitute a further or continuing waiver of any rights the Company may have pursuant to the terms of this Agreement or the Plan (including but not limited to the rights afforded the Company in Section 20 herein).

[Signature Page Follows]

RSU Agreement (Employees – without Employment Agreement)

Rev. April 2018

IN WITNESS WHEREOF, this Agreement has been executed in behalf of the Company and by the Participant effective as of the day and year first above written.



ATLANTIC CAPITAL BANCSHARES, INC. By: Printed Name: Title: Attest: Secretary [Corporate Seal]	PARTICIPANT By: Printed Name:

RSU Agreement (Employees – without Employment Agreement)

Rev. April 2018

ATLANTIC CAPITAL BANCSHARES, INC.
2015 STOCK INCENTIVE PLAN

Restricted Stock Unit Agreement
(Employees)

SCHEDULE A

Grant Date:

Number of Shares Subject to Award: ______ shares


Restriction Period:	The Shares subject to the Award shall vest and be earned in installments, as provided below, subject to the continued employment or service of the Participant and such other terms and conditions as may be imposed by the Plan and the Agreement:



Date of Vesting	Percentage Vested

ATLANTIC CAPITAL BANCSHARES, INC.
2015 STOCK INCENTIVE PLAN

Restricted Stock Unit Agreement
(Employees)

SCHEDULE B

“Prohibited Activity”

A “ Prohibited Activity ” shall be any violation of any one or more than one of the protective covenants set forth hereafter:

6. Non-Piracy of Employees . During the Participant’s employment and for a period of twelve ( 12 ) months following any termination, the Participant covenants and agrees that the Participant shall not, within the Territory, directly or indirectly: (a) solicit, recruit, or hire (or attempt to solicit, recruit, or hire) or otherwise assist anyone in soliciting, recruiting, or hiring, any employee or independent contractor (which shall not include non-exclusive outside vendors) of the Employers who performed work for the Employers within the last six ( 6 ) months of the Participant’s employment with the Employers or who was otherwise engaged or employed with the Employers at the time of said termination of employment of the Participant or (b) otherwise encourage, solicit, or support any such employees or independent contractors to leave their employment or engagement with the Employers, in either case until such employee or contractor has been terminated or separated from the Employers for at least twelve ( 12 ) months.

8. Protected Rights . Notwithstanding anything in this Agreement to the contrary, (a) nothing in this Agreement or other agreement prohibits the Participant from reporting possible violations of law or regulation to any governmental agency or entity, including but not limited to the Department of Justice, the Securities and Exchange Commission, the Congress and any agency Inspector General (the “ Government Agencies ”), or communicating with Government Agencies or otherwise participating in any investigation or proceedings that may be conducted by Government Agencies, including providing documents or other information; (b) the Participant does not need the prior authorization of the Employers to take any action described in (a), and the Participant is not required to notify the Employers that he or she has taken any action described in (a); and (c) this Agreement does not limit the Participant’s right to receive an award for providing information relating to a possible securities law violation to the Securities and Exchange Commission. Further, notwithstanding the foregoing, the Participant shall not be held criminally or civilly liable under any federal, state or local trade secret law for the disclosure of a trade secret that (x) is made (A) in confidence to a federal, state or local official, either directly or indirectly, or to an attorney; and (B) solely for the purpose of reporting or investigating a suspected violation or law; or (y) is made in a compliant or other document filed in a lawsuit or other proceeding, if such filing is made under seal. Additionally, an individual suing an employer for retaliation based on the reporting of a suspected violation of law may disclose a trade secret to his or her attorney and use the trade secret information in the court proceeding, so long as any document containing the trade secret is filed under seal and the individual does not disclose the trade secret except pursuant to court order. The rights described in this Section 8 are referred to in this Agreement as the “ Protected Rights .”

9. Acknowledgment .

RSU Agreement (Employees – without Employment Agreement)

Rev. April 2018

Exhibit 10.6

Option No. _____

ATLANTIC CAPITAL BANCSHARES, INC.

2015 STOCK INCENTIVE PLAN

Stock Option Agreement

(Employees)

Name of Participant:

Grant Date:

Number of Shares Subject to Option:

Option Price:

Type of Option:

Expiration Date:

THIS AGREEMENT (together with Schedules A and B attached hereto, this “ Agreement”) is made effective as of the ___ day of ______________, ____ (the “ Grant Date ”) between Atlantic Capital Bancshares, Inc., a Georgia corporation (the “Company” ), and ___________________, an Employee of the Company or an Affiliate (the “Participant” ).

R E C I T A L S :

In furtherance of the purposes of the Atlantic Capital Bancshares, Inc. 2015 Stock Incentive Plan, as it may be amended (the “Plan” ), and in consideration of the services of the Participant and such other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Participant hereby agree as follows:

2. Grant of Option; Term of Option . Subject to the terms of this Agreement and the Plan, the Company hereby grants the Participant, as a matter of separate inducement and agreement in connection with his or her employment with or service to the Company, and not in lieu of any salary or other compensation for his or her services, the right and option (the “Option ”) to purchase all or any part of an aggregate of ___________ (______) shares (the “Shares” ) of the Common Stock (the “Common Stock” ), at a purchase price (the “Option Price”) of ___________ Dollars ($______) per Share. The Option to purchase ___________ (____) of the Shares shall be designated as an

Stock Option Agreement (Employees – with Employment Agreement)

Rev. April 2018

Incentive Option. The Option to purchase ____________ (____) of the Shares shall be designated as a Nonqualified Option. To the extent that the Option is designated as an Incentive Option and such Option does not qualify as an Incentive Option, the Option (or portion thereof) shall be treated as a Nonqualified Option. Except as otherwise provided in the Plan, the Option will expire if not exercised in full before __________ ___, _____ (the “Expiration Date” ) (such term commencing with the Grant Date and ending on the Expiration Date being referred to as the “Option Period” ).

3. Exercise of Option .

(a) The Option shall become exercisable on the date or dates and subject to such conditions set forth in the Plan, this Agreement and Schedule A, which is attached hereto and expressly made a part of this Agreement. Notwithstanding anything to the contrary herein, the Protective Covenants contained in the Agreement between the Participant and the Company dated _____________, 20____ (the “ Employment Agreement ”), a copy of which is attached hereto as Schedule B and incorporated herein by reference, shall remain in full force and effect according to their terms regardless of whether the Participant’s rights under this Agreement have vested or not or have been forfeited or not.

(b) To the extent that the Option is exercisable but is not exercised, the Option shall accumulate and be exercisable by the Participant in whole or in part at any time prior to expiration of the Option, subject to the terms of the Plan and this Agreement. Upon the exercise of the Option in whole or in part, payment of the Option Price in accordance with the provisions of the Plan and this Agreement, and satisfaction of such other conditions as may be established by the Administrator, the Company shall promptly deliver to the Participant a certificate or certificates for the Shares purchased. The total number of Shares that may be acquired upon exercise of the Option shall be rounded down to the nearest whole share. Payment of the Option Price may be made in cash or cash equivalent; provided that, except where prohibited by the Administrator or any Applicable Law (and subject to such terms and conditions as may be established by the Administrator), payment may also be made (i) by delivery (by either actual delivery or attestation) of shares of Common Stock owned by the Participant for such time period, if any, as may be determined by the Administrator; (ii) by shares of Common Stock withheld upon exercise; (iii) by delivery of written notice of exercise to the Company and delivery to a broker of written notice of exercise and irrevocable instructions to promptly deliver to the Company the amount of sale or loan proceeds to pay the Option Price; (iv) by such other payment methods as may be approved by the Administrator and which are acceptable under Applicable Law; or (v) by any combination of the foregoing methods. Shares delivered or withheld in payment of the Option Price shall be valued at their Fair Market Value on the date of exercise, as determined by the Administrator or its designee.

(c) Limitation on Incentive Options . In no event shall there first become exercisable by the Participant in any one calendar year Incentive Options granted by the Company or any Parent or Subsidiary with respect to shares having an aggregate Fair Market Value (determined at the time an Incentive Option is granted) greater than $100,000. To the extent that any Incentive Options are first exercisable by the Participant in excess of such limitation, the excess shall be considered a Nonqualified Option.

Stock Option Agreement (Employees – with Employment Agreement)

Rev. April 2018

4. Effect of Change of Control .

(i) To the extent that the successor or surviving company in the Change of Control event does not assume or substitute the Option (or in which the Company is the ultimate parent corporation and does not continue the Option) on substantially similar terms or with substantially equivalent economic benefits (as determined by the Administrator) as the Option outstanding immediately prior to the Change of Control event, the Option shall become fully vested and exercisable, whether or not then otherwise vested and exercisable.

(ii) Further, in the event that the Option is substituted, assumed or continued as provided in Section 4(a) herein, the Option will nonetheless become vested and exercisable in full, if the employment or service of the Participant is terminated within six months before (in which case vesting shall not occur until the effective date of the Change of Control) or one year (or such other period after a Change of Control as may be stated in the Participant’s employment, change of control, consulting or other similar agreement, if applicable) after the effective date of a Change of Control if such termination of employment or service (i) is by the Company not for Cause or (ii) is by the Participant for Good Reason. For clarification, for the purposes of this Section 4, the “Company” shall include any successor to the Company.

(iii) Notwithstanding any other provision of the Plan to the contrary, in the event that the Participant has entered into an employment agreement as of the Effective Date of the Plan or is a participant in the Company’s Change in Control Plan or similar arrangement, the Participant shall be entitled to the greater of the benefits provided upon a change of control of the Company under the Plan or the respective employment agreement, Change in Control Plan or other arrangement, and such agreement, Change in Control Plan or other arrangement shall not be construed to reduce in any way the benefits otherwise provided to a Participant upon a Change of Control as defined in the Plan.

Stock Option Agreement (Employees – with Employment Agreement)

Rev. April 2018

immediately after such transaction, or (B) the sale or disposition of all or substantially all the assets of the Company; or

(For the purposes herein, the term “ person ” shall mean any individual, corporation, partnership, group, association or other person, as such term is defined in Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, other than the Company, a Subsidiary of the Company or any employee benefit plan(s) sponsored or maintained by the Company or any Subsidiary thereof, and the term “ beneficial owner ” shall have the meaning given the term in Rule 13d-3 under the Exchange Act.)

Notwithstanding the preceding provisions of Section 4(b), in the event that the Option is deemed to be deferred compensation subject to (and not exempt from) the provisions of Code Section 409A, then distributions related to the Option to be made upon a Change of Control may be permitted, in the Administrator's discretion, upon the occurrence of one or more of the following events (as they are defined and interpreted under Code Section 409A): (A) a change in the ownership of the Company; (B) a change in effective control of the Company; or (C) a change in the ownership of a substantial portion of the assets of the Company.

5. Effect of Termination of Employment or Service . The Option shall not be exercised unless the Participant is, at the time of exercise, an Employee and has been an Employee continuously since the date the Option was granted, subject to the following:

(a) The employment or service relationship of the Participant shall be treated as continuing intact for any period that the Participant is on military or sick leave or other bona fide leave of absence, provided that the period of such leave does not exceed 90 days, or, if longer, as long as the Participant’s right to reemployment is guaranteed either by statute or by contract. The employment or service relationship of the Participant shall also be treated as continuing intact while the Participant is not in active service because of Disability. The Administrator shall have sole authority to determine whether the Participant has incurred a Disability, and, if applicable, the Participant’s Termination Date.

(b) Subject to the terms of Section 3(c) of the Plan, if the employment or service of the Participant is terminated because of Disability, death, Good Reason (as defined in the

Stock Option Agreement (Employees – with Employment Agreement)

Rev. April 2018

Participant’s Employment Agreement with the Company and/or Atlantic Capital Bank (the “ Bank ”), or, if there is no Employment Agreement defining Good Reason, as defined in Section 5(b) of this Agreement) or Retirement, any portion of the Option that is unexercised and unvested on the Participant’s Termination Date shall immediately vest and become exercisable. The Option must be exercised, if at all, prior to the close of the Option Period. In the event of the Participant’s death, the Option shall be exercisable by such person or persons as shall have acquired the right to exercise the Option by will or by the laws of intestate succession. The Option shall cease to qualify for favorable income tax treatment as an incentive stock option under Code Section 422 if (and to the extent) the Option is exercised for Shares (i) more than three months after the date the Participant ceases to be an Employee for any reason other than death or Disability, or (ii) more than 12 months after the date the Participant ceases to be an Employee by reason of Disability.

For purposes of this Section 5, “ Good Reason ” shall occur if during the Participant’s employment, the Participant’s employment is materially and adversely altered by the Company, without the Participant’s consent, by:

(i) a material reduction in the Participant’s base salary;

(ii) the assignment to the Participant of duties or responsibilities materially inconsistent with, or a material diminution in, the Participant’s position, authority, duties or responsibilities; or

(iii) the relocation of the Participant’s principal place of employment by more than 30 miles from the location at which the Participant is stationed.

An event or condition that would otherwise constitute “Good Reason” shall constitute Good Reason only if the Company fails to rescind or cure such event or condition within 30 days after receipt from the Participant of written notice of the event which constitutes Good Reason, and Good Reason shall cease to exist for any event or condition described herein on the 60 ^th day following the later of the occurrence or the Participant’s knowledge thereof, unless the Participant has given the Company written notice thereof prior to such date.

(c) If the employment or service of the Participant is terminated for any reason other than Disability, death, Good Reason, Retirement or for Cause, the Option may be exercised to the extent vested and exercisable on the Participant’s Termination Date. Any unvested portion of the Option shall terminate on the Termination Date. The Option must be exercised, if at all, prior to the first to occur of the following, whichever shall be applicable: (X) the close of the period of three months next succeeding the Termination Date; or (Y) the close of the Option Period. If the Participant dies following such termination of employment or service and prior to the earlier of the dates specified in (X) or (Y) of this Section 5(c), the Participant shall be treated as having died while employed under Section 5(b) (treating for this purpose the Participant’s date of termination of employment or service as the Termination Date). In the event of the Participant’s death, the Option shall be exercisable by such person or persons as shall have acquired the right to exercise the Option by will or by the laws of intestate succession.

Stock Option Agreement (Employees – with Employment Agreement)

Rev. April 2018

(d) If the employment or service of the Participant is terminated for Cause, the Option shall lapse and no longer be exercisable as of the Participant’s Termination Date, as determined by the Administrator. The determination of “Cause” shall be made by the Administrator and such determination shall be final and conclusive. Without in any way limiting the effect of the foregoing, for purposes of the Plan and the Option, the Participant’s employment or service shall be deemed to have terminated for Cause if, after the Participant’s employment or service has terminated, facts and circumstances are discovered that would have justified, in the opinion of the Administrator, a termination for Cause.

6. No Right of Continued Employment or Service; Forfeiture of Option; No Right to Future Awards . Neither the Plan, this Agreement, the grant of the Option nor any other action related to the Plan shall confer upon the Participant any right to continue in the employ or service of the Company or an Affiliate or to interfere in any way with the right of the Company or an Affiliate to terminate the Participant’s employment or service at any time. Except as otherwise provided in the Plan or this Agreement or as may be determined by the Administrator, all rights of the Participant with respect to the Option shall terminate upon termination of the Participant’s employment or service with the Company or an Affiliate. The Participant acknowledges and agrees that the Company has no obligation to advise the Participant of the expiration of the Option. The grant of the Option does not create any obligation to grant further awards.

7. Nontransferability of Option . To the extent that this Option is designated as an Incentive Option, the Option shall not be transferable (including by sale, assignment, pledge or hypothecation) other than transfers by will or the laws of intestate succession, or, in the Administrator’s discretion, such transfers as may otherwise be permitted in accordance with Treasury Regulation Section 1.421-1(b)(2) or Treasury Regulation Section 1.421-2(c) or any successor provisions thereto. To the extent that this Option is designated as a Nonqualified Option, the Option shall not be transferable (including by sale, assignment, pledge or hypothecation) other than by will or the laws of intestate succession, except for transfers if and to the extent permitted by the Administrator in a manner consistent with the registration provisions of the Securities Act. Except as may be permitted by the preceding sentences, the Option shall be exercisable during the Participant’s lifetime only by him or by the Participant’s guardian or legal representative. The designation of a beneficiary in accordance with the Plan does not constitute a transfer.

8. Superseding Agreement; Binding Effect . This Agreement supersedes any statements, representations or agreements of the Company with respect to the grant of the Option, and the Participant hereby waives any rights or claims related to any such statements, representations or agreements. This Agreement does not supersede or amend any existing confidentiality agreement, non-competition agreement, non-solicitation agreement, employment agreement, consulting agreement or any other similar agreement between the Participant and the Company, including but not limited to any restrictive covenants contained in such agreements, which shall remain in full force and effect and enforceable in accordance with their terms. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective executors, administrators, next-of-kin, successors and assigns.

Stock Option Agreement (Employees – with Employment Agreement)

Rev. April 2018

9. Representations and Warranties of Participant . The Participant represents and warrants to the Company that:

(b) Tax Consequences . The Participant acknowledges that he or she is solely responsible and liable for the satisfaction of all taxes and penalties that may arise in connection with the Option (including but not limited to any taxes arising under Code Section 409A), and the Company shall not have any obligation to indemnify or otherwise hold the Participant harmless from any or all such taxes. The Participant further acknowledges that the Company has made no warranties or representations to the Participant with respect to the tax consequences (including but not limited to income tax consequences) related to the transactions contemplated by this Agreement, and the Participant is in no manner relying on the Company or its representatives for an assessment of such tax consequences. The Participant acknowledges that there may be adverse tax consequences upon acquisition or disposition of the Shares subject to the Option and that the Participant should consult a tax advisor prior to such acquisition or disposition. The Participant acknowledges that he or she has been advised that he or she should consult with his or her own attorney, accountant and/or tax advisor regarding the decision to enter into this Agreement and the consequences thereof. The Participant also acknowledges that the Company has no responsibility to take or refrain from taking any actions in order to achieve a certain tax result for the Participant.

10. Restrictions on Option and Shares .

(a) Other Agreements . As a condition to the issuance and delivery of the Shares subject to the Option, or the grant of any benefit pursuant to the terms of the Plan, the Company may require the Participant or other person to become a party to this Agreement, any shareholders’ agreement, other agreement(s) restricting the transfer, purchase or repurchase of shares of Common Stock of the Company, voting agreement and/or employment agreements, consulting agreements, non-competition agreements, confidentiality agreements, non-solicitation agreements or other agreements imposing such restrictions as may be required by the Company. In addition, without in any way limiting the effect of the foregoing, the Participant or other holder of the Shares shall be permitted to transfer such Shares only if such transfer is in accordance with the terms of the Plan, this Agreement, any shareholders’ agreement and any other applicable agreements. The acquisition of the Shares by the Participant or any other holder of the Shares shall be subject to, and conditioned upon, the agreement of the Participant or other holder of such Shares to the restrictions described in the Plan, this Agreement, any shareholders’ agreement and any other applicable agreements.

Stock Option Agreement (Employees – with Employment Agreement)

Rev. April 2018

distribution or action is in compliance with Applicable Law (including but not limited to the requirements of the Securities Act). The Company is under no obligation to register the Shares with the Securities and Exchange Commission or to effect compliance with the exemption, registration, qualification or listing requirements of any state securities laws, stock exchange or similar organization, and the Company shall have no liability for any inability or failure to do so. The Company may cause a restrictive legend or legends to be placed on any certificate for Shares issued pursuant to the Option in such form as may be prescribed from time to time by Applicable Law or as may be advised by legal counsel.

11. Certain Changes in Status . The Participant acknowledges that the Administrator has the sole discretion to determine (taking into account any Code Section 409A considerations), at any time, the effect, if any, on the Option (including but not limited to modifying the vesting and/or exercisability of the Option) of any changes in the Participant’s status (other than termination) as an Employee, including but not limited to a change from full-time to part-time, or vice versa, or other similar changes in the nature or scope of the Participant’s employment or service.

12. Governing Law . Except as otherwise provided in the Plan or herein, this Agreement shall be construed and enforced according to the laws of the State of Georgia, without regard to the conflict of laws provisions of any state, and in accordance with applicable federal laws of the United States. The Company and the Participant agree that any dispute arising from this Agreement shall be resolved only in a state or federal court sitting in Fulton County, Georgia, which shall have exclusive jurisdiction over any such dispute. The Company and the Participant consent to the personal jurisdiction and waive any objection to jurisdiction or venue in any such court.

13. Amendment and Termination; Waiver . Subject to the terms of the Plan, this Agreement may be amended, altered, suspended and/or terminated at any time, prospectively or retroactively, by the Administrator; provided, however, that any such amendment, alteration, suspension or termination of the Option shall not, without the written consent of the Participant, materially adversely affect the rights of the Participant with respect to the Option. Notwithstanding the foregoing, the Administrator shall have unilateral authority to amend the Plan and this Agreement (without Participant consent) to the extent necessary to comply with Applicable Law or changes to Applicable Law (including but in no way limited to Code Section 409A, Code Section 422 and federal securities laws). The Administrator also shall have unilateral authority to make adjustments to the terms and conditions of the Option in recognition of unusual or nonrecurring events affecting the Company or any Affiliate, or the financial statements of the Company or any Affiliate, or of changes in Applicable Law, or accounting principles, if the Administrator determines that such adjustments are appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan or necessary or appropriate to comply with applicable accounting principles or Applicable Law. The waiver by the Company of a breach of any provision of this Agreement by the Participant shall not operate or be construed as a waiver of any subsequent breach by the Participant.

14. No Rights as a Shareholder . The Participant and the Participant’s legal representatives, legatees, distributees or transferees shall not be deemed to be the holder of any Shares subject to

Stock Option Agreement (Employees – with Employment Agreement)

Rev. April 2018

the Option and shall not have any rights of a shareholder unless and until certificates for such Shares have been issued and delivered to him or them.

15. Withholding . The Participant acknowledges that the Company shall require the Participant or other person to pay to the Company in cash the amount of any tax or other amount required by any governmental authority to be withheld and paid over by the Company to such authority for the account of the Participant, and the Participant agrees, as a condition to the grant of the Option and delivery of the Shares or any other benefit, to satisfy such obligations. Notwithstanding the foregoing, the Administrator may in its discretion establish procedures to permit the Participant to satisfy such obligation in whole or in part, and any local, state, federal, foreign or other income tax obligations relating to the Option, by electing (the “ election ”) to deliver to the Company shares of Common Stock held by the Participant (which are fully vested and not subject to any pledge or other security interest) and/or have the Company withhold shares of Common Stock from the Shares to which the Participant is otherwise entitled. The number of shares to be withheld shall have a Fair Market Value as of the date that the amount of tax to be withheld is determined as nearly equal as possible to, but not exceeding (unless otherwise permitted by the Administrator in a manner in accordance with Applicable Law and applicable accounting principles), the amount of such obligations being satisfied. Each election must be made in writing to the Administrator in accordance with election procedures established by the Administrator.

19. Notice of Disposition . To the extent that the Option is designated as an Incentive Option, if Shares of Common Stock acquired upon exercise of the Option are disposed of within two years following the date of grant or one year following the transfer of such Shares to the Participant upon exercise, the Participant shall, promptly following such disposition, notify the Company in writing

Stock Option Agreement (Employees – with Employment Agreement)

Rev. April 2018

of the date and terms of such disposition and provide such other information regarding the disposition as the Administrator may reasonably require.

21. Forfeiture of Option .

(a) Notwithstanding any other provision of this Agreement, if, at any time during the employment or service of the Participant or during the 12-month period following termination of employment or service (regardless of whether such termination was by the Company or the Participant, and whether voluntary or involuntary or with or without Cause or Good Reason), the Participant engages in a Prohibited Activity (as defined herein), then the Option shall immediately be terminated (to the extent not otherwise already terminated) and all of Participant’s rights under this Agreement shall be forfeited in their entirety.

22. Compliance with Recoupment, Ownership and Other Policies or Agreements . As a condition to receiving this Option, the Participant agrees that he or she shall abide by all provisions of any equity retention policy, stock ownership guidelines, compensation recovery policy and/or other policies adopted by the Company, each as in effect from time to time and to the extent applicable to the Participant. In addition, the Participant shall be subject to such compensation recovery, recoupment, forfeiture or other similar provisions as may apply to him or her under Applicable Law.

[Signature Page Follows]

Stock Option Agreement (Employees – with Employment Agreement)

Rev. April 2018

IN WITNESS WHEREOF, this Agreement has been executed in behalf of the Company and by the Participant effective as of the day and year first above written.



ATLANTIC CAPITAL BANCSHARES, INC. By: Printed Name: Title: Attest: Secretary [Corporate Seal]	PARTICIPANT By: Printed Name:

Stock Option Agreement (Employees – with Employment Agreement)

Rev. April 2018

ATLANTIC CAPITAL BANCSHARES, INC.

2015 STOCK INCENTIVE PLAN

Stock Option Agreement

(Employees)

SCHEDULE A



Date Option granted:	___________________, _____
Date Option expires:	___________________, _____
Number of Shares subject to Option:	_______ shares
Option Price (per Share):	$________

Type of Option:	_____ Incentive Option
	_____ Nonqualified Option



Date Installment First Exercisable		Percentage of Option Which Is Exercisable

ATLANTIC CAPITAL BANCSHARES, INC.

2015 STOCK INCENTIVE PLAN

Stock Option Agreement

(Employees)

SCHEDULE B

Employment Agreement

[Attached]

Stock Option Agreement (Employees – with Employment Agreement)

Rev. April 2018

Exhibit 10.7

Option No. _____

ATLANTIC CAPITAL BANCSHARES, INC.

2015 STOCK INCENTIVE PLAN

Stock Option Agreement

(Employees)

Name of Participant:

Grant Date:

Number of Shares Subject to Option:

Option Price:

Type of Option:

Expiration Date:

THIS AGREEMENT (together with Schedules A and B attached hereto, this “Agreement” ) is made effective as of the ___ day of ______________, ____ (the “ Grant Date ”) between Atlantic Capital Bancshares, Inc., a Georgia corporation (the “Company” ), and ___________________, an Employee of the Company or an Affiliate (the “Participant” ).

R E C I T A L S :

In furtherance of the purposes of the Atlantic Capital Bancshares, Inc. 2015 Stock Incentive Plan, as it may be amended (the “Plan” ), and in consideration of the services of the Participant and such other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Participant hereby agree as follows:

Stock Option Agreement (Employees – without Employment Agreement)

Rev. April 2018

such Option does not qualify as an Incentive Option, the Option (or portion thereof) shall be treated as a Nonqualified Option. Except as otherwise provided in the Plan, the Option will expire if not exercised in full before __________ ___, _____ (the “Expiration Date” ) (such term commencing with the Grant Date and ending on the Expiration Date being referred to as the “Option Period” ).

3. Exercise of Option .

4. Effect of Change of Control .

(i) To the extent that the successor or surviving company in the Change of Control event does not assume or substitute the Option (or in which the Company is the

Stock Option Agreement (Employees – without Employment Agreement)

Rev. April 2018

ultimate parent corporation and does not continue the Option) on substantially similar terms or with substantially equivalent economic benefits (as determined by the Administrator) as the Option outstanding immediately prior to the Change of Control event, the Option shall become fully vested and exercisable, whether or not then otherwise vested and exercisable.

(iii) Notwithstanding any other provision of the Plan to the contrary, in the event that the Participant has entered into an employment agreement as of the Effective Date of the Plan or is a participant in the Company’s Change in Control Plan or similar arrangement, the Participant shall be entitled to the greater of the benefits provided upon a change of control of the Company under the Plan or the respective employment agreement, Change in Control Plan or other arrangement, and such agreement, Change in Control Plan or other arrangement shall not be construed to reduce in any way the benefits otherwise provided to a Participant upon a Change of Control as defined in the Plan.

Stock Option Agreement (Employees – without Employment Agreement)

Rev. April 2018

(For the purposes herein, the term “ person ” shall mean any individual, corporation, partnership, group, association or other person, as such term is defined in Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, other than the Company, a Subsidiary of the Company or any employee benefit plan(s) sponsored or maintained by the Company or any Subsidiary thereof, and the term “ beneficial owner ” shall have the meaning given the term in Rule 13d-3 under the Exchange Act.)

(b) Subject to the terms of Section 3(c) of the Plan, if the employment or service of the Participant is terminated because of Disability, death, Good Reason (as defined in the Participant’s employment agreement with the Company and/or Atlantic Capital Bank (the “ Bank ”), or, if there is no employment agreement defining Good Reason, as defined in Section 5(b) of this Agreement) or Retirement, any portion of the Option that is unexercised and unvested on the Participant’s Termination Date shall immediately vest and become exercisable. The Option must be exercised, if at all, prior to the close of the Option Period. In the event of the Participant’s death, the Option shall be exercisable by such person or persons as shall have acquired the right to exercise the Option by will or by the laws of intestate succession. The Option shall cease to qualify for favorable income tax treatment as an incentive stock option under Code Section 422 if (and to the extent) the Option is exercised for Shares (i) more than three months after the date the Participant

Stock Option Agreement (Employees – without Employment Agreement)

Rev. April 2018

ceases to be an Employee for any reason other than death or Disability, or (ii) more than 12 months after the date the Participant ceases to be an Employee by reason of Disability.

(i) a material reduction in the Participant’s base salary;

(ii) the assignment to the Participant of duties or responsibilities materially inconsistent with, or a material diminution in, the Participant’s position, authority, duties or responsibilities; or

(iii) the relocation of the Participant’s principal place of employment by more than 30 miles from the location at which the Participant is stationed.

An event or condition that would otherwise constitute “Good Reason” shall constitute Good Reason only if the Company fails to rescind or cure such event or condition within 30 days after receipt from the Participant of written notice of the event which constitutes Good Reason, and Good Reason shall cease to exist for any event or condition described herein on the 60 ^th day following the later of the occurrence or the Participant’s knowledge thereof, unless the Participant has given the Company written notice thereof prior to such date.

Stock Option Agreement (Employees – without Employment Agreement)

Rev. April 2018

9. Representations and Warranties of Participant . The Participant represents and warrants to the Company that:

Stock Option Agreement (Employees – without Employment Agreement)

Rev. April 2018

from any or all such taxes. The Participant further acknowledges that the Company has made no warranties or representations to the Participant with respect to the tax consequences (including but not limited to income tax consequences) related to the transactions contemplated by this Agreement, and the Participant is in no manner relying on the Company or its representatives for an assessment of such tax consequences. The Participant acknowledges that there may be adverse tax consequences upon acquisition or disposition of the Shares subject to the Option and that the Participant should consult a tax advisor prior to such acquisition or disposition. The Participant acknowledges that he or she has been advised that he or she should consult with his or her own attorney, accountant and/or tax advisor regarding the decision to enter into this Agreement and the consequences thereof. The Participant also acknowledges that the Company has no responsibility to take or refrain from taking any actions in order to achieve a certain tax result for the Participant.

10. Restrictions on Option and Shares .

(b) Compliance with Applicable Law . The Company may impose such restrictions on the Option, the Shares and any other benefits underlying the Option as it may deem advisable, including without limitation restrictions under the federal securities laws, the requirements of any stock exchange or similar organization and any blue sky, state or foreign securities laws or other laws applicable to such securities. Notwithstanding any other provision of the Plan or this Agreement to the contrary, the Company shall not be obligated to issue, deliver or transfer shares of Common Stock, make any other distribution of benefits or take any other action, unless such delivery, distribution or action is in compliance with Applicable Law (including but not limited to the requirements of the Securities Act). The Company is under no obligation to register the Shares with the Securities and Exchange Commission or to effect compliance with the exemption, registration, qualification or listing requirements of any state securities laws, stock exchange or similar organization, and the Company shall have no liability for any inability or failure to do so. The Company may cause a restrictive legend or legends to be placed on any certificate for Shares issued pursuant to the Option in such form as may be prescribed from time to time by Applicable Law or as may be advised by legal counsel.

Stock Option Agreement (Employees – without Employment Agreement)

Rev. April 2018

11. Certain Changes in Status . The Participant acknowledges that the Administrator has the sole discretion to determine (taking into account any Code Section 409A considerations), at any time, the effect, if any, on the Option (including but not limited to modifying the vesting and/or exercisability of the Option) of any changes in the Participant’s status (other than termination) as an Employee, including but not limited to a change from full-time to part-time, or vice versa, or other similar changes in the nature or scope of the Participant’s employment or service.

14. No Rights as a Shareholder . The Participant and the Participant’s legal representatives, legatees, distributees or transferees shall not be deemed to be the holder of any Shares subject to the Option and shall not have any rights of a shareholder unless and until certificates for such Shares have been issued and delivered to him or them.

Stock Option Agreement (Employees – without Employment Agreement)

Rev. April 2018

or other income tax obligations relating to the Option, by electing (the “ election ”) to deliver to the Company shares of Common Stock held by the Participant (which are fully vested and not subject to any pledge or other security interest) and/or have the Company withhold shares of Common Stock from the Shares to which the Participant is otherwise entitled. The number of shares to be withheld shall have a Fair Market Value as of the date that the amount of tax to be withheld is determined as nearly equal as possible to, but not exceeding (unless otherwise permitted by the Administrator in a manner in accordance with Applicable Law and applicable accounting principles), the amount of such obligations being satisfied. Each election must be made in writing to the Administrator in accordance with election procedures established by the Administrator.

Stock Option Agreement (Employees – without Employment Agreement)

Rev. April 2018

21. Forfeiture of Option .

(a) Notwithstanding any other provision of this Agreement, if, at any time during the employment or service of the Participant or during the 12-month period following termination of employment or service (regardless of whether such termination was by the Company or the Participant, and whether voluntary or involuntary or with or without Cause or Good Reason), the Participant engages in a Prohibited Activity (as defined herein), then the Option shall immediately be terminated (to the extent not otherwise already terminated) and all of Participant’s rights under this Agreement shall be forfeited in their entirety.

(b) For the purposes herein, a “Prohibited Activity” shall have the meaning set forth on Schedule B attached hereto.

[Signature Page Follows]

Stock Option Agreement (Employees – without Employment Agreement)

Rev. April 2018

IN WITNESS WHEREOF, this Agreement has been executed in behalf of the Company and by the Participant effective as of the day and year first above written.



ATLANTIC CAPITAL BANCSHARES, INC. By: Printed Name: Title: Attest: Secretary [Corporate Seal]	PARTICIPANT By: Printed Name:

Stock Option Agreement (Employees – without Employment Agreement)

Rev. April 2018

ATLANTIC CAPITAL BANCSHARES, INC.

2015 STOCK INCENTIVE PLAN

Stock Option Agreement

(Employees)

SCHEDULE A



Date Option granted:	___________________, _____
Date Option expires:	___________________, _____
Number of Shares subject to Option:	_______ shares
Option Price (per Share):	$________

Type of Option:	_____ Incentive Option
	_____ Nonqualified Option



Date Installment First Exercisable		Percentage of Option Which Is Exercisable

ATLANTIC CAPITAL BANCSHARES, INC.

2015 STOCK INCENTIVE PLAN

Stock Option Agreement

(Employees)

SCHEDULE B

“Prohibited Activity”

A “ Prohibited Activity ” shall be any violation of any one or more than one of the protective covenants set forth hereafter:

9. Acknowledgment .

Stock Option Agreement (Employees – without Employment Agreement)

Rev. April 2018

Exhibit 10.8

Performance Share Award No. ___

ATLANTIC CAPITAL BANCSHARES, INC.

2015 STOCK INCENTIVE PLAN

(As Amended and Restated Effective May 18, 2017)

Performance Share Award Agreement

(Employees)



Name of Participant:
Grant Date:
Threshold Number of Shares Subject to Award:	As set forth on Schedule A
Target Number Subject to Award:	As set forth on Schedule A
Maximum Number of Shares Subject to Award:	As set forth on Schedule A
Performance Metrics:	As set forth on Schedule A
Performance Period:	As set forth on Schedule A

R E C I T A L S :

In furtherance of (i) the purposes of the Atlantic Capital Bancshares, Inc. 2015 Stock Incentive Plan, as amended and restated effective May 18, 2017 and as it may be further amended and/or restated (the “ Plan ”), and (ii) the Atlantic Capital Bancshares, Inc. Executive Officer Long-Term Incentive Plan, as amended and restated effective April 19, 2018, and as it may be further amended and/or restated (the “ LTIP ”), and in consideration of the services of the Participant and such other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Participant hereby agree as follows:

1. Incorporation of Plan and LTIP . The rights and duties of the Company and the Participant under this Agreement shall in all respects be subject to and governed by the provisions of the Plan and the LTIP, copies of which are delivered herewith or have been previously provided to the Participant and the terms of which are incorporated herein by reference. In the event of any conflict between the provisions in this Agreement and those of the Plan or the LTIP, the provisions of the Plan or the LTIP, as the case shall be, shall govern, unless the Administrator determines otherwise. In addition, in the event of any conflict between the provisions in the Plan and the LTIP, the provisions of the Plan shall govern, unless the Administrator determines otherwise. Unless otherwise defined herein, capitalized terms in this Agreement shall have the same definitions as set forth in the Plan.

PSA Agreement (Employees – with Employment Agreement)

2. Grant of Performance Share Award . Subject to the terms of this Agreement, the Plan and the LTIP, the Company hereby grants the Participant a Performance Share Award (the “ Award ”) for up to the maximum number of shares of Common Stock (the “ Shares ”) as is set forth above and in Schedule A. The Award represents a Bonus opportunity granted under the LTIP and shall be payable, if and to the extent earned, solely in shares issued under the Plan (or a successor plan). The Participant expressly acknowledges that the terms of Schedules A and B shall be incorporated herein by reference and shall constitute part of this Agreement.

4. Earning of Award .

(a) Subject to the terms of the Plan and this Agreement, including but not limited to Section 5 and Section 13 herein, the Award shall be deemed earned, and the Shares subject to the Award shall be distributable as provided in Section 6 herein, upon such date or dates, and subject to such conditions, as are described in this Agreement, including but not limited to Schedule A. To be entitled to distribution of Shares or other payment hereunder (if any) upon vesting and earning of the Award, the Participant must be employed by the Company on the last day of the Performance Period. The Participant expressly acknowledges that the Award shall be deemed earned only upon such terms and conditions as are provided in this Agreement (including but not limited to Schedule A) and otherwise in accordance with the terms of the Plan. Notwithstanding anything to the contrary herein, the protective covenants contained in the Agreement between Participant and the Company dated ___________________, 20____ (the “ Employment Agreement ”), a copy of which is attached hereto as Schedule B and incorporated herein by reference, shall remain in full force and effect according to their terms regardless of whether the Participant’s rights under this Agreement have vested and been earned or not or have been forfeited or not.

5. Effect of Termination of Employment or Service .

PSA Agreement (Employees – with Employment Agreement)

part of the Award has not been earned pursuant to the terms of the Plan and this Agreement, then the Award, to the extent not earned as of the Participant’s Termination Date, shall be forfeited immediately upon such termination, and the Participant shall have no further rights with respect to the Award or the Shares underlying that portion of the Award that has not yet been earned. The Participant expressly acknowledges and agrees that the termination of his or her employment or service shall (except as may otherwise be provided in this Agreement or in the Plan) result in forfeiture of the Award and the Shares to the extent that the Award has not been earned as of his or her Termination Date.

(b) Notwithstanding the provisions of Section 5(a), and subject to the terms of Section 3(c) of the Plan, in the event of the Participant’s termination due to (i) death; (ii) Disability; (iii) Retirement; or (iv) Good Reason (as defined in the Participant’s Employment Agreement, or if there is no Employment Agreement defining Good Reason, as defined in Section 5(c) of this Agreement), a pro-rata portion of the Award shall be eligible to be earned based on attainment of the Performance Metrics for the Performance Period as specified in this Agreement, including Schedule A. The pro-rata portion that may be earned and vested shall be determined by multiplying the total number of Shares earned under Schedule A by a fraction, the numerator of which is the number of calendar days the Participant was employed during the Performance Period, and the denominator of which is the number of calendar days in the Performance Period; any such shares so earned shall be payable as provided in Section 6 herein.

(i) a material reduction in the Participant’s base salary;

(ii) the assignment to the Participant of duties or responsibilities materially inconsistent with, or a material diminution in, the Participant’s position, authority, duties or responsibilities; or

(iii) the relocation of the Participant’s principal place of employment by more than 30 miles from the location at which the Participant is stationed.

An event or condition that would otherwise constitute “Good Reason” shall constitute Good Reason only if the Company fails to rescind or cure such event or condition within 30 days after receipt from the Participant of written notice of the event which constitutes Good Reason, and Good Reason shall cease to exist for any event or condition described herein on the 60 ^th day following the later of the occurrence or the Participant’s knowledge thereof, unless the Participant has given the Company written notice thereof prior to such date.

(d) In the event that the Participant’s employment or service is terminated due to Cause, the Award shall immediately be forfeited and the Participant shall have no right to any Shares or other benefits related to the Award.

PSA Agreement (Employees – with Employment Agreement)

(e) The Administrator shall have the sole discretion to determine the basis for the Participant’s termination of employment or service, including whether such termination is due to Disability, Retirement, Good Reason or Cause.

6. Settlement of Award . The Administrator shall have discretion to determine the extent, if any, to which the Award has been earned. The Award, if earned in accordance with the terms of this Agreement, shall be payable in whole shares of Common Stock. The total number of Shares that may be acquired upon earning of the Award (or portion thereof) shall be rounded down to the nearest whole share. A certificate or certificates for the Shares subject to the Award or portion thereof shall be issued in the name of the Participant or his or her beneficiary (or, in the case of uncertificated shares, other written evidence of ownership in accordance with Applicable Law shall be provided) within 70 days following the date the Award or portion thereof has been earned in accordance with the terms of this Agreement; provided that the following shall apply: (i) in the event the Award is earned following completion of the Performance Period as described in Section 4 and Schedule A, herein, the Shares shall be distributable no later than 70 days following the completion of the Performance Period; (ii) in the event the Award is earned pursuant to Section 5(b) herein, the Shares shall be distributable no later than 70 days following the completion of the Performance Period; and (iii) in the event that the Award is earned pursuant to Section 13 herein, the Shares shall be distributable no later than 70 days following the occurrence of the Change of Control (as defined for these purposes under Code Section 409A) in the case of payment pursuant to Section 13(a)(i) or Section 13(a)(ii) (if the payment event is a Change in Control) or within 70 days of the Participant’s Termination Date if the payment event pursuant to Section 13(a)(ii) is the Participant’s termination of employment or service. If the 70-day period described herein begins in one calendar year and ends in another, the Participant (or his beneficiary) shall not have the right to designate the calendar year of the distribution (except as otherwise provided below with respect to a delay in distribution if the Participant is a “specified employee”). Notwithstanding the foregoing, if the Participant is or may be a “specified employee” (as defined under Code Section 409A), and the distribution is considered deferred compensation under Code Section 409A, then such distribution if made due to separation from service shall be subject to delay as provided in Section 21 of the Plan (or any successor provision thereto).

7. No Right of Continued Employment or Service; Forfeiture of Award; No Right to Future Awards . Neither the Plan, this Agreement, the grant of the Award nor any other action related to the Plan shall confer upon the Participant any right to continue in the employ or service of the Company or an Affiliate or to interfere in any way with the right of the Company or an Affiliate to terminate the Participant’s employment or service at any time. Except as otherwise provided in the Plan or this Agreement or as may be determined by the Administrator, all rights of the Participant with respect to the unvested and unearned portion of the Award shall terminate upon termination of the Participant’s employment or service with the Company or an Affiliate. The Participant acknowledges and agrees that the Company has no obligation to advise the Participant of the expiration of the Award. The grant of the Award does not create any obligation to grant further awards.

8. Nontransferability of Award and Shares . The Award shall not be transferable (including by sale, assignment, pledge or hypothecation) other than transfers by will or the laws of

PSA Agreement (Employees – with Employment Agreement)

intestate succession, and the Participant or other recipient of the Award shall not sell, transfer, assign, pledge or otherwise encumber the Shares subject to the Award until the Performance Period has expired and all conditions to earning and vesting in the Award have been met. The designation of a beneficiary in accordance with the Plan does not constitute a transfer.

10. Representations and Warranties of Participant . The Participant represents and warrants to the Company that:

(a) Agrees to Terms of the Plan and Agreement . The Participant has received a copy of the Plan and the LTIP, has read and understands the terms of the Plan, the LTIP and this Agreement and agrees to be bound by their terms and conditions.

11. Restrictions on Award and Shares .

PSA Agreement (Employees – with Employment Agreement)

non-competition agreements, confidentiality agreements, non-solicitation agreements or other agreements imposing such restrictions as may be required by the Company. In addition, without in any way limiting the effect of the foregoing, the Participant or other holder of the Shares shall be permitted to transfer such Shares only if such transfer is in accordance with the terms of the Plan, this Agreement, any shareholders’ agreement and any other applicable agreements. The acquisition of the Shares by the Participant or any other holder of the Shares shall be subject to, and conditioned upon, the agreement of the Participant or other holder of such Shares to the restrictions described in the Plan, this Agreement, any shareholders’ agreement and any other applicable agreements.

13. Effect of Change of Control.

(a) Subject to the terms of the Plan (and unless otherwise required pursuant to Code Section 409A), the following provisions shall apply in the event of a Change of Control:

(ii) Further, in the event that the Award is substituted, assumed or continued as provided in Section 13(a) herein, the Award shall nonetheless be deemed to be

PSA Agreement (Employees – with Employment Agreement)

vested, earned and payable at target (as determined by the Administrator), if the employment or service of the Participant is terminated within six months before (in which case vesting shall not occur until the effective date of the Change of Control) or one year (or such other period after a Change of Control as may be stated in a Participant’s employment, change of control, consulting or other similar agreement, if applicable) after the effective date of a Change of Control if such termination of employment or service (i) is by the Company not for Cause or (ii) is by the Participant for Good Reason. For clarification, for the purposes of this Section 13, the “Company” shall include any successor to the Company.

(For the purposes herein, the term “ person ” shall mean any individual, corporation, partnership, group, association or other person, as such term is defined in Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, other than the Company, a Subsidiary of the Company or any employee benefit plan(s) sponsored or maintained by the Company or any Subsidiary thereof, and the term “ beneficial owner ” shall have the meaning given the term in Rule 13d-3 under the Exchange Act.)

PSA Agreement (Employees – with Employment Agreement)

16. Withholding . The Participant acknowledges that the Company shall require the Participant or other person to pay to the Company in cash the amount of any tax or other amount

PSA Agreement (Employees – with Employment Agreement)

required by any governmental authority to be withheld and paid over by the Company to such authority for the account of the Participant, and the Participant agrees, as a condition to the grant of the Award and delivery of the Shares or any other benefit, to satisfy such obligations. Notwithstanding the foregoing, the Administrator may in its discretion establish procedures to permit the Participant to satisfy such obligation in whole or in part, and any local, state, federal, foreign or other income tax obligations relating to the Award, by electing (the “ election ”) to deliver to the Company shares of Common Stock held by the Participant (which are fully vested and not subject to any pledge or other security interest) and/or have the Company withhold shares of Common Stock from the Shares to which the Participant is otherwise entitled. The number of shares to be withheld shall have a Fair Market Value as of the date that the amount of tax to be withheld is determined as nearly equal as possible to, but not exceeding (unless otherwise permitted by the Administrator in a manner in accordance with Applicable Law and applicable accounting principles), the amount of such obligations being satisfied. Each election must be made in writing to the Administrator in accordance with election procedures established by the Administrator.

PSA Agreement (Employees – with Employment Agreement)

21. Forfeiture of Award .

[Signature Page Follows]

PSA Agreement (Employees – with Employment Agreement)

IN WITNESS WHEREOF, this Agreement has been executed in behalf of the Company and by the Participant effective as of the day and year first above written.



ATLANTIC CAPITAL BANCSHARES, INC. By: Printed Name: Title: Attest: Secretary [Corporate Seal]	PARTICIPANT By: Printed Name:

PSA Agreement (Employees – with Employment Agreement)

ATLANTIC CAPITAL BANCSHARES, INC.

2015 STOCK INCENTIVE PLAN

(As Amended and Restated Effective May 18, 2017)

Performance Share Award Agreement
(Employees)

SCHEDULE A



Performance Period:
Grant Date:
Performance Metric(s):
Target Number of Shares Subject to Award:
Threshold Number of Shares Subject to Award:
Maximum Number of Shares Subject to Award:

1. Earning of Award :

(a) General . The Award is granted to the Participant on the Grant Date set forth above and represents a right to receive some or all of the Shares (as defined in the Agreement) underlying the Award subject to satisfaction of the Performance Metric(s) (as defined below) as described herein. The Participant may earn from _____% to _____% of the target number of Shares subject to the Award, depending upon performance. The Performance Metric(s) are weighted _________________. The Award may be earned, if at all, based on attainment of performance goals specified below for _____ performance metric(s) (each, a “ Performance Metric ” and collectively, the “ Performance Metrics ”): ____________________________________. The Award shall not be deemed earned, and none of the Shares attributable to a Performance Metric shall be issued, unless the particular Performance Metric is attained at a minimum of the threshold level for such Performance Metric. If performance falls below the threshold level with regard to a Performance Metric, then no Shares shall be distributed with respect to that Performance Metric. The extent to which the Performance Metrics are met, and the number of Shares distributable, if any, shall be calculated with respect to each Performance Metric pursuant to the terms and conditions described in Section 2 below. All determinations made with respect to the Performance Metrics and the earning of the Award shall be made by the Administrator in its sole discretion, and the applicable Performance Metrics shall not be deemed achieved and the Award shall not be deemed earned unless and to the extent that the Administrator determines that the Award has been earned.

(b) Administrator Discretion . Notwithstanding any other terms of the Agreement, including this Schedule A, (i) the Administrator has sole discretion to reduce or eliminate that portion of the Award that shall be deemed earned and related Shares issuable, notwithstanding the attainment of threshold, target or maximum performance levels for either or both Performance Metrics, if the Administrator determines that

PSA Agreement (Employees – with Employment Agreement)

____________________, and (ii) the actual number of Shares earned may be reduced by the Administrator in its sole and absolute discretion based on such factors as the Administrator determines to be appropriate and advisable (however, it is the intention of the Administrator that it shall exercise such negative discretion only in extreme and unusual circumstances).

2. Calculation of Earning of Award .



		Number of Shares Earned at
Measure	% Weighting of Performance Metric	Threshold (___% of target)	Target (____% of target)	Maximum (_____% of target)

To the extent the actual level of attainment of each Performance Metric is at a point between the threshold performance level and the target performance level or between the target performance level and the maximum performance level, the number of Shares which the Participant may earn shall be determined based on linear interpolation.

Performance Metric:

Threshold:

Target:

Maximum:

If, for the Performance Period, the Company achieves the threshold performance level set forth above, the Participant shall be entitled to ___________ of the target number of the Shares.

If, for the Performance Period, the Company achieves the target performance level set forth above, the Participant shall be entitled to ____________ of the target number the Shares.

If, for the Performance Period, the Company achieves the maximum performance level set forth above, the Participant shall be entitled to ____________ of the target number of the Shares.

[Any additional performance metrics to be included here.]

3. Certain Definitions . In addition to other terms defined herein, the following definitions shall apply:

PSA Agreement (Employees – with Employment Agreement)

ATLANTIC CAPITAL BANCSHARES, INC.

2015 STOCK INCENTIVE PLAN

(As Amended and Restated Effective May 18, 2017)

Performance Share Award Agreement
(Employees)

SCHEDULE B

Employment Agreement

[Attached]

PSA Agreement (Employees – with Employment Agreement)

Exhibit 10.9

Performance Share Award No. ___

ATLANTIC CAPITAL BANCSHARES, INC.

2015 STOCK INCENTIVE PLAN

(As Amended and Restated Effective May 18, 2017)

Performance Share Award Agreement

(Employees)



Name of Participant:
Grant Date:
Threshold Number of Shares Subject to Award:	As set forth on Schedule A
Target Number Subject to Award:	As set forth on Schedule A
Maximum Number of Shares Subject to Award:	As set forth on Schedule A
Performance Metrics:	As set forth on Schedule A
Performance Period:	As set forth on Schedule A

R E C I T A L S :

PSA Agreement (Employees – without Employment Agreement)

4. Earning of Award .

5. Effect of Termination of Employment or Service .

(a) Except as otherwise provided in this Section 5 or in Section 13 herein, if the employment or service of the Participant is terminated for any reason (whether by the Company or the Participant and whether voluntary or involuntary or with or without Cause) (such date of termination of employment or service being referred to as the “ Termination Date ”) and all or any part of the Award has not been earned pursuant to the terms of the Plan and this Agreement, then the Award, to the extent not earned as of the Participant’s Termination Date, shall be forfeited immediately upon such termination, and the Participant shall have no further rights with respect to the Award or the Shares underlying that portion of the Award that has not yet been earned. The Participant expressly acknowledges and agrees that the termination of his or her employment or

PSA Agreement (Employees – without Employment Agreement)

service shall (except as may otherwise be provided in this Agreement or in the Plan) result in forfeiture of the Award and the Shares to the extent that the Award has not been earned as of his or her Termination Date.

(b) Notwithstanding the provisions of Section 5(a), and subject to the terms of Section 3(c) of the Plan, in the event of the Participant’s termination due to (i) death; (ii) Disability; (iii) Retirement; or (iv) Good Reason (as defined in the Participant’s employment agreement, or if there is no employment agreement defining Good Reason, as defined in Section 5(c) of this Agreement), a pro-rata portion of the Award shall be eligible to be earned based on attainment of the Performance Metrics for the Performance Period as specified in this Agreement, including Schedule A. The pro-rata portion that may be earned and vested shall be determined by multiplying the total number of Shares earned under Schedule A by a fraction, the numerator of which is the number of calendar days the Participant was employed during the Performance Period, and the denominator of which is the number of calendar days in the Performance Period; any such shares so earned shall be payable as provided in Section 6 herein.

(i) a material reduction in the Participant’s base salary;

(ii) the assignment to the Participant of duties or responsibilities materially inconsistent with, or a material diminution in, the Participant’s position, authority, duties or responsibilities; or

(iii) the relocation of the Participant’s principal place of employment by more than 30 miles from the location at which the Participant is stationed.

An event or condition that would otherwise constitute “Good Reason” shall constitute Good Reason only if the Company fails to rescind or cure such event or condition within 30 days after receipt from the Participant of written notice of the event which constitutes Good Reason, and Good Reason shall cease to exist for any event or condition described herein on the 60 ^th day following the later of the occurrence or the Participant’s knowledge thereof, unless the Participant has given the Company written notice thereof prior to such date.

6. Settlement of Award . The Administrator shall have discretion to determine the extent, if any, to which the Award has been earned. The Award, if earned in accordance with the

PSA Agreement (Employees – without Employment Agreement)

terms of this Agreement, shall be payable in whole shares of Common Stock. The total number of Shares that may be acquired upon earning of the Award (or portion thereof) shall be rounded down to the nearest whole share. A certificate or certificates for the Shares subject to the Award or portion thereof shall be issued in the name of the Participant or his or her beneficiary (or, in the case of uncertificated shares, other written evidence of ownership in accordance with Applicable Law shall be provided) within 70 days following the date the Award or portion thereof has been earned in accordance with the terms of this Agreement; provided that the following shall apply: (i) in the event the Award is earned following completion of the Performance Period as described in Section 4 and Schedule A, herein, the Shares shall be distributable no later than 70 days following the completion of the Performance Period; (ii) in the event the Award is earned pursuant to Section 5(b) herein, the Shares shall be distributable no later than 70 days following the completion of the Performance Period; and (iii) in the event that the Award is earned pursuant to Section 13 herein, the Shares shall be distributable no later than 70 days following the occurrence of the Change of Control (as defined for these purposes under Code Section 409A) in the case of payment pursuant to Section 13(a)(i) or Section 13(a)(ii) (if the payment event is a Change in Control) or within 70 days of the Participant’s Termination Date if the payment event pursuant to Section 13(a)(ii) is the Participant’s termination of employment or service. If the 70-day period described herein begins in one calendar year and ends in another, the Participant (or his beneficiary) shall not have the right to designate the calendar year of the distribution (except as otherwise provided below with respect to a delay in distribution if the Participant is a “specified employee”). Notwithstanding the foregoing, if the Participant is or may be a “specified employee” (as defined under Code Section 409A), and the distribution is considered deferred compensation under Code Section 409A, then such distribution if made due to separation from service shall be subject to delay as provided in Section 21 of the Plan (or any successor provision thereto).

7. No Right of Continued Employment or Service; Forfeiture of Award; No Right to Future Awards . Neither the Plan, this Agreement, the grant of the Award nor any other action related to the Plan shall confer upon the Participant any right to continue in the employ or service of the Company or an Affiliate or to interfere in any way with the right of the Company or an Affiliate to terminate the Participant’s employment or service at any time. Except as otherwise provided in the Plan or this Agreement or as may be determined by the Administrator, all rights of the Participant with respect to the unvested and unearned portion of the Award shall terminate upon termination of the Participant’s employment or service with the Company or an Affiliate. The Participant acknowledges and agrees that the Company has no obligation to advise the Participant of the expiration of the Award. The grant of the Award does not create any obligation to grant further awards.

8. Nontransferability of Award and Shares . The Award shall not be transferable (including by sale, assignment, pledge or hypothecation) other than transfers by will or the laws of intestate succession, and the Participant or other recipient of the Award shall not sell, transfer, assign, pledge or otherwise encumber the Shares subject to the Award until the Performance Period has expired and all conditions to earning and vesting in the Award have been met. The designation of a beneficiary in accordance with the Plan does not constitute a transfer.

PSA Agreement (Employees – without Employment Agreement)

10. Representations and Warranties of Participant . The Participant represents and warrants to the Company that:

11. Restrictions on Award and Shares .

PSA Agreement (Employees – without Employment Agreement)

of the Shares by the Participant or any other holder of the Shares shall be subject to, and conditioned upon, the agreement of the Participant or other holder of such Shares to the restrictions described in the Plan, this Agreement, any shareholders’ agreement and any other applicable agreements.

13. Effect of Change of Control.

(a) Subject to the terms of the Plan (and unless otherwise required pursuant to Code Section 409A), the following provisions shall apply in the event of a Change of Control:

(ii) Further, in the event that the Award is substituted, assumed or continued as provided in Section 13(a) herein, the Award shall nonetheless be deemed to be vested, earned and payable at target (as determined by the Administrator), if the employment or service of the Participant is terminated within six months before (in which case vesting shall not occur until the effective date of the Change of Control) or one year (or such other period after a Change of Control as may be stated in a Participant’s employment, change of control, consulting or other similar agreement, if applicable) after the effective date of a

PSA Agreement (Employees – without Employment Agreement)

Change of Control if such termination of employment or service (i) is by the Company not for Cause or (ii) is by the Participant for Good Reason. For clarification, for the purposes of this Section 13, the “Company” shall include any successor to the Company.

(For the purposes herein, the term “ person ” shall mean any individual, corporation, partnership, group, association or other person, as such term is defined in Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, other than the Company, a Subsidiary of the Company or any employee benefit plan(s) sponsored or maintained by the Company or any Subsidiary thereof, and the term “ beneficial owner ” shall have the meaning given the term in Rule 13d-3 under the Exchange Act.)

PSA Agreement (Employees – without Employment Agreement)

transaction of other similar effect; and (ii) in no event shall a firm commitment underwritten public offering of the Common Stock pursuant to an effective registration statement under the Securities Act constitute a Change of Control.

PSA Agreement (Employees – without Employment Agreement)

the Participant to satisfy such obligation in whole or in part, and any local, state, federal, foreign or other income tax obligations relating to the Award, by electing (the “ election ”) to deliver to the Company shares of Common Stock held by the Participant (which are fully vested and not subject to any pledge or other security interest) and/or have the Company withhold shares of Common Stock from the Shares to which the Participant is otherwise entitled. The number of shares to be withheld shall have a Fair Market Value as of the date that the amount of tax to be withheld is determined as nearly equal as possible to, but not exceeding (unless otherwise permitted by the Administrator in a manner in accordance with Applicable Law and applicable accounting principles), the amount of such obligations being satisfied. Each election must be made in writing to the Administrator in accordance with election procedures established by the Administrator.

21. Forfeiture of Award .

PSA Agreement (Employees – without Employment Agreement)

Participant engages in a Prohibited Activity (as defined herein), then the Award shall immediately be terminated (to the extent not otherwise already terminated) and all of Participant’s rights under this Agreement shall be forfeited in their entirety.

(b) For the purposes herein, a “Prohibited Activity” shall have the meaning set forth on Schedule B attached hereto.

[Signature Page Follows]

PSA Agreement (Employees – without Employment Agreement)

IN WITNESS WHEREOF, this Agreement has been executed in behalf of the Company and by the Participant effective as of the day and year first above written.



ATLANTIC CAPITAL BANCSHARES, INC. By: Printed Name: Title: Attest: Secretary [Corporate Seal]	PARTICIPANT By: Printed Name:

PSA Agreement (Employees – without Employment Agreement)

ATLANTIC CAPITAL BANCSHARES, INC.

2015 STOCK INCENTIVE PLAN

(As Amended and Restated Effective May 18, 2017)

Performance Share Award Agreement
(Employees)

SCHEDULE A



Performance Period:
Grant Date:
Performance Metric(s):
Target Number of Shares Subject to Award:
Threshold Number of Shares Subject to Award:
Maximum Number of Shares Subject to Award:

1. Earning of Award :

(a) General . The Award is granted to the Participant on the Grant Date set forth above and represents a right to receive some or all of the Shares (as defined in the Agreement) underlying the Award subject to satisfaction of the Performance Metric(s) (as defined below) as described herein. The Participant may earn from _____% to _____% of the target number of Shares subject to the Award, depending upon performance. The Performance Metric(s) are weighted ______________. The Award may be earned, if at all, based on attainment of performance goals specified below for _________ performance metric(s) (each, a “ Performance Metric ” and collectively, the “ Performance Metrics ”): __________________. The Award shall not be deemed earned, and none of the Shares attributable to a Performance Metric shall be issued, unless the particular Performance Metric is attained at a minimum of the threshold level for such Performance Metric. If performance falls below the threshold level with regard to a Performance Metric, then no Shares shall be distributed with respect to that Performance Metric. The extent to which the Performance Metrics are met, and the number of Shares distributable, if any, shall be calculated with respect to each Performance Metric pursuant to the terms and conditions described in Section 2 below. All determinations made with respect to the Performance Metrics and the earning of the Award shall be made by the Administrator in its sole discretion, and the applicable Performance Metrics shall not be deemed achieved and the Award shall not be deemed earned unless and to the extent that the Administrator determines that the Award has been earned.

PSA Agreement (Employees – without Employment Agreement)

and (ii) the actual number of Shares earned may be reduced by the Administrator in its sole and absolute discretion based on such factors as the Administrator determines to be appropriate and advisable (however, it is the intention of the Administrator that it shall exercise such negative discretion only in extreme and unusual circumstances).

2. Calculation of Earning of Award .



		Number of Shares Earned at
Measure	% Weighting of Performance Metric	Threshold (___% of target)	Target (___% of target)	Maximum (___% of target)

Performance Metric:

Threshold:

Target:

Maximum:

If, for the Performance Period, the Company achieves the threshold performance level set forth above, the Participant shall be entitled to _____________ of the target number of the Shares.

If, for the Performance Period, the Company achieves the target performance level set forth above, the Participant shall be entitled to ______________ of the target number the Shares.

If, for the Performance Period, the Company achieves the maximum performance level set forth above, the Participant shall be entitled to _____________ of the target number of the Shares.

[Any additional performance metrics to be included here.]

3. Certain Definitions . In addition to other terms defined herein, the following definitions shall apply:

PSA Agreement (Employees – without Employment Agreement)

ATLANTIC CAPITAL BANCSHARES, INC.

2015 STOCK INCENTIVE PLAN

(As Amended and Restated Effective May 18, 2017)

Performance Share Award Agreement
(Employees)

SCHEDULE B

“Prohibited Activity”

A “ Prohibited Activity ” shall be any violation of any one or more than one of the protective covenants set forth hereafter:

PSA Agreement (Employees – without Employment Agreement)

Employers’ prior written consent, except as necessary in the Participant’s performance of the Participant’s duties while employed with the Employers.

PSA Agreement (Employees – without Employment Agreement)

authorization of the Employers to take any action described in (a), and the Participant is not required to notify the Employers that he or she has taken any action described in (a); and (c) this Agreement does not limit the Participant’s right to receive an award for providing information relating to a possible securities law violation to the Securities and Exchange Commission. Further, notwithstanding the foregoing, the Participant shall not be held criminally or civilly liable under any federal, state or local trade secret law for the disclosure of a trade secret that (x) is made (A) in confidence to a federal, state or local official, either directly or indirectly, or to an attorney; and (B) solely for the purpose of reporting or investigating a suspected violation or law; or (y) is made in a compliant or other document filed in a lawsuit or other proceeding, if such filing is made under seal. Additionally, an individual suing an employer for retaliation based on the reporting of a suspected violation of law may disclose a trade secret to his or her attorney and use the trade secret information in the court proceeding, so long as any document containing the trade secret is filed under seal and the individual does not disclose the trade secret except pursuant to court order. The rights described in this Section 8 are referred to in this Agreement as the “ Protected Rights .”

9. Acknowledgment .

PSA Agreement (Employees – without Employment Agreement)

is ruled invalid or unenforceable by a court of competent jurisdiction because of a conflict between the provision and any Applicable Law or public policy, the provision shall be redrawn to make the provision consistent with, and valid and enforceable under, the law or public policy.

PSA Agreement (Employees – without Employment Agreement)

EXHIBIT 31.1

CERTIFICATION PURSUANT TO RULE 13a-14(a) OR 15d-14(a) OF THE EXCHANGE ACT,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Douglas L. Williams, certify that:


1.	I have reviewed this quarterly report on Form 10-Q of Atlantic Capital Bancshares, Inc.;


2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;


3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;


4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f) for the registrant and have:


a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;


b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;


c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and


d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and


5.	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):


a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and


b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 9, 2018





	/s/ Douglas L. Williams
	Douglas L. Williams
	President and Chief Executive Officer

EXHIBIT 31.2

CERTIFICATION PURSUANT TO RULE 13a-14(a) OR 15d-14(a) OF THE EXCHANGE ACT,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Patrick T. Oakes, certify that:


1.	I have reviewed this quarterly report on Form 10-Q of Atlantic Capital Bancshares, Inc.;


2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;


3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;


4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f) for the registrant and have:


a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;


b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;


c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and


d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and


5.	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):


a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and


b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 9, 2018





	/s/ Patrick T. Oakes
	Patrick T. Oakes
	Executive Vice President, Chief Financial Officer, and Secretary

EXHIBIT 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Douglas L. Williams, Chief Executive Officer of Atlantic Capital Bancshares, Inc. (the “Company”), certify pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that, to my knowledge:




(1)	the Quarterly Report on Form 10-Q of the Company for the fiscal quarter ended March 31, 2018 (the “Report”), as filed with the Securities and Exchange Commission, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and




(2)	the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company on the dates and for the periods presented therein.





	May 9, 2018	/s/ Douglas L. Williams
		Douglas L. Williams
		President and Chief Executive Officer

EXHIBIT 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Patrick T. Oakes, Chief Financial Officer of Atlantic Capital Bancshares, Inc. (the “Company”), certify pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that, to my knowledge:




(1)	the Quarterly Report on Form 10-Q of the Company for the fiscal quarter ended March 31, 2018 (the “Report”), as filed with the Securities and Exchange Commission, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and




(2)	the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company on the dates and for the periods presented therein.





	May 9, 2018	/s/ Patrick T. Oakes
		Patrick T. Oakes
		Executive Vice President, Chief Financial Officer, and Secretary