1115055--2/26/2010--PINNACLE_FINANCIAL_PARTNERS

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We are geographically concentrated in the Nashville, Tennessee and Knoxville, Tennessee MSAs, and changes in local economic conditions impact our profitability. If our allowance for loan losses is not sufficient to cover actual loan losses, our earnings will decrease. We have increased levels of other real estate owned, primarily as a result of foreclosures, and we anticipate higher levels of foreclosed real estate expense. Legislative and regulatory initiatives that were enacted in response to the financial crisis are beginning to wind down. National or state legislation or regulation may increase our expenses and reduce earnings. We may not be able to continue to expand into the Knoxville MSA in the time frame and at the levels that we currently expect. Our ability to maintain required capital levels and adequate sources of funding and liquidity could be impacted by changes in the capital markets and deteriorating economic and market conditions. Although we have initiated efforts to reduce our reliance on noncore funding, this type of funding still represents a large component of our funding base. If the federal funds rate remains at current extremely low levels, our net interest margin, and consequently our net earnings, may be negatively impacted Fluctuations in interest rates could reduce our profitability. Our stock price can be volatile. A decline in our stock price or expected future cash flows, or a material adverse change in our results of operations or prospects, could result in impairment of our goodwill. An investment in our common stock is not an insured deposit. We have a significant deferred tax asset and cannot assure you that it will be fully realized. Competition with other banking institutions could adversely affect our profitability. Loss of our senior executive officers or other key employees could impair our relationship with our customers and adversely affect our business. The limitations on bonuses, retention awards, severance payments and incentive compensation contained in ARRA may adversely affect our ability to retain our highest performing employees. We may issue additional common stock or other equity securities in the future which could dilute the ownership interest of existing shareholders. Even though our common stock is currently traded on the Nasdaq Stock Market s Global Select Market, it has less liquidity than many other stocks quoted on a national securities exchange. If a change in control is delayed or prevented, the market price of our common stock could be negatively affected. Holders of Pinnacle Financial s bank indebtedness and junior subordinated debentures have rights that are senior to those of Pinnacle Financial s common shareholders. Our business is dependent on technology, and an inability to invest in technological improvements may adversely affect our results of operations and financial condition.

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1115055--2/26/2010--PINNACLE_FINANCIAL_PARTNERS_INC