Exhibit 4.2


WARRANT TO PURCHASE PREFERRED STOCK


THE SECURITIES REPRESENTED
BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE TRANSFERRED,
SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A REGISTRATION STATEMENT RELATING
THERETO IS IN EFFECT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR
PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT OR SUCH LAWS. THIS
INSTRUMENT IS ISSUED SUBJECT TO THE RESTRICTIONS ON TRANSFER AND OTHER
PROVISIONS OF A SECURITIES PURCHASE AGREEMENT BETWEEN THE ISSUER OF THESE
SECURITIES AND THE INVESTOR REFERRED TO THEREIN, A COPY OF WHICH IS ON FILE
WITH THE ISSUER. THE SECURITIES REPRESENTED BY THIS INSTRUMENT MAY NOT BE SOLD
OR OTHERWISE TRANSFERRED EXCEPT IN COMPLIANCE WITH SAID AGREEMENT. ANY SALE OR
OTHER TRANSFER NOT IN COMPLIANCE WITH SAID AGREEMENT WILL BE VOID. 


WARRANT
to purchase 600.006 Shares of

Fixed Rate Cumulative Perpetual Preferred Stock, Series B

(no par value)

of

FNB BANCORP


Issue Date: February 27, 2009


          1.
Definitions


          
Unless the context otherwise requires, when used herein the following terms
shall have the meanings indicated. 


          “Board of Directors” means the board of
directors of the Company, including any duly authorized committee thereof. 


          “business day” means any day except
Saturday, Sunday and any day on which banking institutions in the State of New
York generally are authorized or required by law or other governmental actions
to close. 


          “Charter” means, with respect to any
Person, its certificate or articles of incorporation, articles of association,
or similar organizational document. 


          “Company” means the Person whose name,
corporate or other organizational form and jurisdiction of organization is set
forth in Item 1 of Schedule A hereto. 






          “Exchange Act” means the Securities
Exchange Act of 1934, as amended, or any successor statute, and the rules and
regulations promulgated thereunder. 


          “Exercise Price” means the amount set
forth
in Item 2 of Schedule A hereto. 


          “Expiration Time” has the meaning set
forth
in Section 3. 


          “Issue
Date” means the date
set forth in Item 3 of Schedule A hereto. 


          “Liquidation Amount” means the amount set
forth in Item 4 of Schedule A hereto. 


          “Original Warrantholder” means the United
States Department of the Treasury. Any actions specified to be taken by the
Original Warrantholder hereunder may only be taken by such Person and not by
any other Warrantholder. 


          “Person” has the meaning given to it in
Section 3(a)(9) of the Exchange Act and as used in Sections 13(d)(3) and
14(d)(2) of the Exchange Act. 


          “Preferred
Stock” means the
series of perpetual preferred stock set forth in Item 5 of Schedule A hereto. 


          “Purchase Agreement” means the Securities
Purchase Agreement – Standard Terms incorporated into the Letter Agreement,
dated as of the date set forth in Item 6 of Schedule A hereto, as amended from
time to time, between the Company and the United States Department of the
Treasury (the “Letter Agreement”),
including all annexes and schedules thereto. 


          “Regulatory Approvals” with respect to
the
Warrantholder, means, to the extent applicable and required to permit the
Warrantholder to exercise this Warrant for shares of Preferred Stock and to own
such Preferred Stock without the Warrantholder being in violation of applicable
law, rule or regulation, the receipt of any necessary approvals and
authorizations of, filings and registrations with, notifications to, or
expiration or termination of any applicable waiting period under, the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules
and regulations thereunder. 


          “SEC” means the U.S. Securities and
Exchange Commission. 


          “Securities Act” means the Securities Act
of 1933, as amended, or any successor statute, and the rules and regulations
promulgated thereunder. 


          “Shares” has the meaning set forth in
Section 2. 


          “Warrantholder” has the meaning set forth
in Section 2. 


          “Warrant” means this Warrant, issued
pursuant to the Purchase Agreement. 


          2.
Number of Shares; Exercise Price


          This
certifies that, for value received, the United States Department of the
Treasury or its permitted assigns (the “Warrantholder”)
is entitled, upon the terms and subject to the conditions hereinafter set
forth, to acquire from the Company, in whole or in part, after the receipt of
all applicable Regulatory Approvals, if any, up to an aggregate of the number
of fully paid and nonassessable shares of Preferred Stock set forth in Item 7
of Schedule A hereto (the “Shares”),
at a purchase price per share of Preferred Stock equal to the Exercise Price. 


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          3.
Exercise of Warrant; Term


          Subject
to Section 2, to the extent permitted by applicable laws and regulations, the
right to purchase the Shares represented by this Warrant is exercisable, in
whole or in part by the Warrantholder, at any time or from time to time after
the execution and delivery of this Warrant by the Company on the date hereof,
but in no event later than 5:00 p.m., New York City time on the tenth
anniversary of the Issue Date (the “Expiration
Time”), by (A) the surrender of this Warrant and Notice of Exercise
annexed hereto, duly completed and executed on behalf of the Warrantholder, at
the principal executive office of the Company located at the address set forth
in Item 8 of Schedule A hereto (or such other office or agency of the Company
in the United States as it may designate by notice in writing to the
Warrantholder at the address of the Warrantholder appearing on the books of the
Company), and (B) payment of the Exercise Price for the Shares thereby
purchased, by having the Company withhold, from the shares of Preferred Stock
that would otherwise be delivered to the Warrantholder upon such exercise,
shares of Preferred Stock issuable upon exercise of the Warrant with an
aggregate Liquidation Amount equal in value to the aggregate Exercise Price as
to which this Warrant is so exercised. 


          If
the Warrantholder does not exercise this Warrant in its entirety, the
Warrantholder will be entitled to receive from the Company within a reasonable
time, and in any event not exceeding three business days, a new warrant in
substantially identical form for the purchase of that number of Shares equal to
the difference between the number of Shares subject to this Warrant and the
number of Shares as to which this Warrant is so exercised. Notwithstanding
anything in this Warrant to the contrary, the Warrantholder hereby acknowledges
and agrees that its exercise of this Warrant for Shares is subject to the
condition that the Warrantholder will have first received any applicable
Regulatory Approvals. 


          4.
Issuance of Shares; Authorization


          Certificates
for Shares issued upon exercise of this Warrant will be issued in such name or
names as the Warrantholder may designate and will be delivered to such named
Person or Persons within a reasonable time, not to exceed three business days
after the date on which this Warrant has been duly exercised in accordance with
the terms of this Warrant. The Company hereby represents and warrants that any
Shares issued upon the exercise of this Warrant in accordance with the
provisions of Section 3 will be duly and validly authorized and issued, fully
paid and nonassessable and free from all taxes, liens and charges (other than
liens or charges created by the Warrantholder, income and franchise taxes
incurred in connection with the exercise of the Warrant or taxes in respect of
any transfer occurring contemporaneously therewith). The Company agrees that
the Shares so issued will be deemed to have been issued to the Warrantholder as
of the close of business on the date on which this Warrant and payment of the
Exercise Price are delivered to the Company in accordance with the terms of
this Warrant, notwithstanding that the stock transfer books of the Company may
then be closed or certificates representing such Shares may not be actually
delivered on such date. The Company will at all times reserve and keep
available, out of its authorized but unissued preferred stock, solely for the
purpose of providing for the exercise of this Warrant, the aggregate number of
shares of Preferred Stock then issuable upon exercise of this Warrant at any
time. The Company will use reasonable best efforts to ensure that the Shares
may be issued without violation of any applicable law or regulation or of any
requirement of any securities exchange on which the Shares are listed or
traded. 


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          5.
No Rights as Stockholders; Transfer Books


          This
Warrant does not entitle the Warrantholder to any voting rights or other rights
as a stockholder of the Company prior to the date of exercise hereof. The
Company will at no time close its transfer books against transfer of this
Warrant in any manner which interferes with the timely exercise of this
Warrant. 


          6.
Charges, Taxes and Expenses


          Issuance
of certificates for Shares to the Warrantholder upon the exercise of this
Warrant shall be made without charge to the Warrantholder for any issue or
transfer tax or other incidental expense in respect of the issuance of such
certificates, all of which taxes and expenses shall be paid by the Company. 


          7.
Transfer/Assignment


          (A)
Subject to compliance with clause (B) of this Section 7, this Warrant and all
rights hereunder are transferable, in whole or in part, upon the books of the
Company by the registered holder hereof in person or by duly authorized
attorney, and a new warrant shall be made and delivered by the Company, of the
same tenor and date as this Warrant but registered in the name of one or more
transferees, upon surrender of this Warrant, duly endorsed, to the office or
agency of the Company described in Section 3. All expenses (other than stock
transfer taxes) and other charges payable in connection with the preparation,
execution and delivery of the new warrants pursuant to this Section 7 shall be
paid by the Company. 


          (B)
The transfer of the Warrant and the Shares issued upon exercise of the Warrant
are subject to the restrictions set forth in Section 4.4 of the Purchase Agreement.
If and for so long as required by the Purchase Agreement, this Warrant shall
contain the legends as set forth in Section 4.2(a) of the Purchase Agreement. 


          8.
Exchange and Registry of Warrant


          This
Warrant is exchangeable, upon the surrender hereof by the Warrantholder to the
Company, for a new warrant or warrants of like tenor and representing the right
to purchase the same aggregate number of Shares. The Company shall maintain a
registry showing the name and address of the Warrantholder as the registered
holder of this Warrant. This Warrant may be surrendered for exchange or
exercise in accordance with its terms, at the office of the Company, and the
Company shall be entitled to rely in all respects, prior to written notice to
the contrary, upon such registry. 


          9.
Loss, Theft, Destruction or Mutilation of Warrant


          Upon
receipt by the Company of evidence reasonably satisfactory to it of the loss,
theft, destruction or mutilation of this Warrant, and in the case of any such
loss, theft or destruction, upon receipt of a bond, indemnity or security
reasonably satisfactory to the Company, or, in the case of any such mutilation,
upon surrender and cancellation of this Warrant, the Company shall make and
deliver, in lieu of such lost, stolen, destroyed or mutilated Warrant, a new
Warrant of like tenor and representing the right to purchase the same aggregate
number of Shares as provided for in such lost, stolen, destroyed or mutilated
Warrant. 


4






          10.
Saturdays, Sundays, Holidays, etc. 


          If
the last or appointed day for the taking of any action or the expiration of any
right required or granted herein shall not be a business day, then such action
may be taken or such right may be exercised on the next succeeding day that is
a business day. 


          11.
Rule 144 Information


          The
Company covenants that it will use its reasonable best efforts to timely file
all reports and other documents required to be filed by it under the Securities
Act and the Exchange Act and the rules and regulations promulgated by the SEC
thereunder (or, if the Company is not required to file such reports, it will,
upon the request of any Warrantholder, make publicly available such information
as necessary to permit sales pursuant to Rule 144 under the Securities Act),
and it will use reasonable best efforts to take such further action as any
Warrantholder may reasonably request, in each case to the extent required from
time to time to enable such holder to, if permitted by the terms of this
Warrant and the Purchase Agreement, sell this Warrant without registration
under the Securities Act within the limitation of the exemptions provided by
(A) Rule 144 under the Securities Act, as such rule may be amended from time to
time, or (B) any successor rule or regulation hereafter adopted by the SEC.
Upon the written request of any Warrantholder, the Company will deliver to such
Warrantholder a written statement that it has complied with such requirements. 


          12.
Adjustments and Other Rights


          For
so long as the Original Warrantholder holds this Warrant or any portion
thereof, if any event occurs that, in the good faith judgment of the Board of
Directors of the Company, would require adjustment of the Exercise Price or number
of Shares into which this Warrant is exercisable in order to fairly and
adequately protect the purchase rights of the Warrants in accordance with the
essential intent and principles of the Purchase Agreement and this Warrant,
then the Board of Directors shall make such adjustments in the application of
such provisions, in accordance with such essential intent and principles, as
shall be reasonably necessary, in the good faith opinion of the Board of
Directors, to protect such purchase rights as aforesaid. 


          Whenever
the Exercise Price or the number of Shares into which this Warrant is
exercisable shall be adjusted as provided in this Section 12, the Company shall
forthwith file at the principal office of the Company a statement showing in
reasonable detail the facts requiring such adjustment and the Exercise Price
that shall be in effect and the number of Shares into which this Warrant shall
be exercisable after such adjustment, and the Company shall also cause a copy
of such statement to be sent by mail, first class postage prepaid, to each
Warrantholder at the address appearing in the Company’s records. 


          13.
No Impairment


          The
Company will not, by amendment of its Charter or through any reorganization,
transfer of assets, consolidation, merger, dissolution, issue or sale of
securities or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms to be observed or performed hereunder by the
Company, but will at all times in good faith assist in the carrying out of all
the provisions of this Warrant and in taking of all such action as may be
necessary or appropriate in order to protect the rights of the Warrantholder. 


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          14.
Governing Law


          This
Warrant will be governed by and construed in accordance with the federal law of
the United States if and to the extent such law is applicable, and otherwise in
accordance with the laws of the State of New York applicable to contracts made
and to be performed entirely within such State. Each of the Company and the
Warrantholder agrees (a) to submit to the exclusive jurisdiction and venue of
the United States District Court for the District of Columbia for any civil
action, suit or proceeding arising out of or relating to this Warrant or the
transactions contemplated hereby, and (b) that notice may be served upon the
Company at the address in Section 17 below and upon the Warrantholder at the
address for the Warrantholder set forth in the registry maintained by the
Company pursuant to Section 8 hereof. To the extent permitted by applicable
law, each of the Company and the Warrantholder hereby unconditionally waives
trial by jury in any civil legal action or proceeding relating to the Warrant
or the transactions contemplated hereby or thereby.


          15.
Binding Effect


          This
Warrant shall be binding upon any successors or assigns of the Company. 


          16.
Amendments


This Warrant may be amended
and the observance of any term of this Warrant may be waived only with the written
consent of the Company and the Warrantholder. 


          17.
Notices


          Any
notice, request, instruction or other document to be given hereunder by any
party to the other will be in writing and will be deemed to have been duly
given (a) on the date of delivery if delivered personally, or by facsimile,
upon confirmation of receipt, or (b) on the second business day following the
date of dispatch if delivered by a recognized next day courier service. All
notices hereunder shall be delivered as set forth in Item 9 of Schedule A
hereto, or pursuant to such other instructions as may be designated in writing
by the party to receive such notice. 


          18.
Entire Agreement


          This
Warrant, the forms attached hereto and Schedule A hereto (the terms of which
are incorporated by reference herein), and the Letter Agreement (including all
documents incorporated therein), contain the entire agreement between the
parties with respect to the subject matter hereof and supersede all prior and
contemporaneous arrangements or undertakings with respect thereto. 


[Remainder of page intentionally left blank] 


6







[Form of Notice of Exercise]


Date: ________________


	
 

	
 


	
TO:

	
FNB Bancorp 


	
 


	
RE:

	
Election to
 Purchase Preferred Stock 





          The
undersigned, pursuant to the provisions set forth in the attached Warrant,
hereby agrees to subscribe for and purchase such number of shares of Preferred
Stock covered by the Warrant such that after giving effect to an exercise
pursuant to Section 3(B) of the Warrant, the undersigned will receive the net
number of shares of Preferred Stock set forth below. The undersigned, in accordance
with Section 3 of the Warrant, hereby agrees to pay the aggregate Exercise
Price for such shares of Preferred Stock in the manner set forth in Section
3(B) of the Warrant. 


	
 

	
 


	
Number of
Shares of Preferred Stock1

	
__________________________________________






          The
undersigned agrees that it is exercising the attached Warrant in full and that,
upon receipt by the undersigned of the number of shares of Preferred Stock set
forth above, such Warrant shall be deemed to be cancelled and surrendered to the
Company. 


	
 

	
 

	
 


	
 

	
Holder:

	
 


	
 

	
 

	



	
 

	
 

	
 


	
 

	
By:

	
 


	
 

	
 

	



	
 

	
 

	
 


	
 

	
Name:

	
 


	
 

	
 

	



	
 

	
 

	
 


	
 

	
Title:

	
 


	
 

	
 

	









	
 

	
 


	
1.

	
Number of shares to be
received by the undersigned upon exercise of the attached Warrant pursuant to
Section 3(B) thereof.





7






          IN
WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by a
duly authorized officer.


          Dated:
February 27, 2009 


	
 

	
 

	
 


	
 

	
COMPANY: FNB
 BANCORP


	
 

	
 

	
 


	
 

	
By: 

	
 


	
 

	
 

	 


	
 

	
 

	
Thomas C. McGraw


	
 

	
 

	
Chief Executive Officer


	
 

	
 

	
 


	
 

	
Attest:


	
 

	
 

	
 


	
 

	
By:

	
 


	
 

	
 

	 


	
 

	
 

	
David A. Curtis


	
 

	
 

	
Senior Vice President and
Chief Financial
 Officer





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SCHEDULE A


Item 1
Name: FNB Bancorp 

Corporate or other organizational form: corporation 

Jurisdiction of organization: California


Item 2
Exercise Price: $0.01 per share


Item 3
Issue Date: February 27, 2009


Item 4
Liquidation Amount: $1,000 per share


Item 5
Series of Perpetual Preferred Stock: Fixed Rate
Cumulative Perpetual Preferred Stock, Series B (no par value) 


Item 6
Date of Letter Agreement between the Company and the
United States Department of the Treasury: February 27, 2009


Item 7

Number of shares of Preferred Stock: 600.006 shares of Fixed Rate Cumulative
Perpetual Preferred Stock, Series B (no par value)


Item 8

Company’s address: FNB Bancorp, 975 El Camino Real, 3rd Floor, South
San Francisco, CA 94080 


	
 

	
 


	
Item 9


	
 

	
Notice
 information: Attention: David A. Curtis, Senior Vice President and Chief
 Financial Officer c/o FNB Bancorp, 975 El Camino Real, 3rd Floor,
 South San Francisco, CA 94080, Telephone (650) 875-4862, email:
 DCurtis@FamilyBank.com





9