**EXHIBIT 10.7**

**LONG TERM PERFORMANCE INCENTIVEPLAN**

**Purpose****:**

To incent Executive Management andmembers of the Board of Directors to build long-term shareholder value.

**Type****:**

The bank’s Long Term PerformanceIncentive Plan provides for the annual grant of stock options of the bank’scommon stock to executive management and members of the board of directorssubject to the achievement of the bank’s annual business plan.  The program incorporates incentive stockoptions (ISO’s) as well as non-qualified stock options (NSO’s) for managementwhile using NSO’s for non-employee directors.

The participants and the amount of theannual grants are as follows:
| Participants                    |   | Annual  Grant (Shares)* |   |
|---------------------------------|--------|-------------------------|--------|
|                                 |   |                         |   |
| Board of Directors  (2000 Each) |   | 20,000                  |   |
| CEO                             |   | 10,000                  |   |
| EVP’s (8,500 each)         |   | 17,000                  |   |
| SVP’s (7000 each)          |   | 21,000                  |   |
|                            |   |                         |   |
|                            |   | 68,000                  |   |

Board members will receive additionaloptions based upon superior achievement of the bank’s annual business planaccording to the schedule below:
| Business Plan |   | Additional       |   | Total            |   |
|---------------|--------|------------------|--------|------------------|--------|
| Exceeded by   |   | Options  Granted |   | Options  Granted |   |
|               |   |                  |   |                  |   |
|          |   |             |   |             |   |
| 5%            |   | 1,000            |   | 3,000            |   |
| 10%           |   | 2,000            |   | 4,000            |   |
| 15%           |   | 3,000            |   | 5,000            |   |

Administration:

·Plan will be administered by the VP/Shareholder Relations under the directionof the Compensation Committee.

·Eligible participants who join the organization prior to July first may beeligible to participate in the program with the approval of the CompensationCommittee (on a pro-rata basis).

·An eligible participant must be an Officer or Board Member of the company atthe time the options are awarded in order to receive a grant.

·Options granted shall be subject to the conditions as outlined in theparticular Stock Option Agreement.

·Options will be generally granted by the end of February following the plan yearend subject to the annual business plan being successfully achieved.

·For the purpose of the Plan the fair market value of the Common Stock shall bethe average of the closing price of the Common Stock on the twenty businessdays prior to and including the date of grant of the option, as reported byNasdaq, or, if the Common Stock is not quoted on NASDAQ, the fair market valueas determined by the Committee.

·Unless otherwise voted, the annual business plan target will be the latestbudget as approved by the Board of Directors.

·The options are forfeited in accordance with the terms as outlined in theparticular Stock Option Agreement.

·In the unlikely event that the number of shares needed to meet the annual grantare not available options will be granted on a pro-rata basis.

**Vesting and Exercise of Options****:**

·The options will vest upon grant and be exercisable at the grant price.

·The maximum amount of incentive options which can become first exercisable inany one year will be limited to $100,000 based on the grant price.

·All options become exercisable in full upon a change of control of the companyeven if the stock price target is not met.

·All options with delayed vesting would fully vest at the end of year nine, evenif none of the targets are met.  Thisprovision is required to avoid unnecessary financial statement charges forcompensation.