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| x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|-----------------------------------------------------------------------------------------|

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

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| Georgia                                                        | 58-2256460                        |
|----------------------------------------------------------------|-----------------------------------|
| (State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) |

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nanci

|     |                  |                                                                                                                           | Page   |
|----------|-----------------------|--------------------------------------------------------------------------------------------------------------------------------|--------|
| Part I.  | FINANCIAL INFORMATION |                                                                                                                           |
|     |                  |                                                                                                                           |   |
|     | Item 1.               | Condensed Consolidated Financial Statements                                                                                    |   |
|     |                  |                                                                                                                           |   |
|     |                  | Condensed Consolidated Balance Sheets – June 30, 2009 and December 31, 2008                                              | 1      |
|     |                  | Condensed Consolidated Statements of Income  - Three and Six Months Ended June 30, 2009 and 2008                     | 2      |
|     |                  | Condensed Consolidated Statements of Comprehensive Income – Three and Six  Months Ended June 30, 2009 and 2008 | 3      |
|     |                  | Condensed Consolidated Statements of Stockholders' Equity – Six Months  Ended June 30, 2009 and 2008           | 4      |
|     |                  | Condensed Consolidated Statements of Cash Flows – Six Months Ended June 30, 2009 and 2008                                | 5      |
|     |                  | Notes to Condensed Consolidated Financial Statements                                                                           | 7      |
|     |                  |                                                                                                                           |   |
|     | Item 2.               | Management’s Discussion and Analysis of Financial Condition and Results of Operations                                    | 18     |
|     |                  |                                                                                                                           |   |
|     | Item 3.               | Quantitative and Qualitative  Disclosures about Market Risk                                                          | 29     |
|     |                  |                                                                                                                           |   |
|     | Item 4.               | Controls and Procedures                                                                                                        | 29     |
|     |                  |                                                                                                                           |   |
| Part II. | OTHER INFORMATION     | 29                                                                                                                             |
|     |                  |                                                                                                                           |   |
|     | Item 1.               | Legal Proceedings                                                                                                              | 29     |
|     | Item 1A.              | Risk                                                                                                                           | 29     |
|     | Item 2.               | Unregistered Sales of Equity Securities and Use of Proceeds                                                                    | 29     |
|     | Item 3.               | Defaults Upon Senior Securities                                                                                                | 29     |
|     | Item 4.               | Submission of Matters to a Vote of Security Holders                                                                            | 30     |
|     | Item 5.               | Other Information                                                                                                              | 30     |
|     | Item 6.               | Exhibits                                                                                                                       | 30     |
|     |                  |                                                                                                                           |   |
|     |                  | Signatures                                                                                                                     | 31     |

----

Index

NANC

| SouthCrest Financial Group, Inc. and Subsidiaries                          |   |
|----------------------------------------------------------------------------|--------|
| Condensed Consolidated Balance Sheets                                      |   |
| June 30, 2009 and December 31, 2008                                        |   |
| (Unaudited)                                                                |   |
| (In thousands, except share and per share data)                            |   |
|                                                                       |   | June 30, |   |   | December 31, |   |
| Assets                                                                     |   | 2009 |   |   | 2008* |   |
| Cash and due from banks                                                    |   | $ | 40,151 |   |   | $ | 18,267 |   |
| Federal funds sold                                                         |   |   | 1,800 |   |   |   | 7,776 |   |
| Interest-bearing deposits at other financial institutions                  |   |   | 22,308 |   |   |   | 16,763 |   |
| Securities available for sale                                              |   |   | 88,898 |   |   |   | 78,910 |   |
| Securities held to maturity (fair value $32,737 and $40,302)               |   |   | 32,234 |   |   |   | 39,216 |   |
| Restricted equity securities, at cost                                      |   |   | 1,845 |   |   |   | 2,294 |   |
| Loans held for sale                                                        |   |   | 140 |   |   |   | 349 |   |
| Loans, net of unearned income                                              |   |   | 395,170 |   |   |   | 395,788 |   |
| Less allowance for loan losses                                             |   |   | 8,105 |   |   |   | 7,285 |   |
| Loans, net                                                                 |   |   | 387,065 |   |   |   | 388,503 |   |
| Bank-owned life insurance                                                  |   |   | 17,327 |   |   |   | 16,997 |   |
| Premises and equipment, net                                                |   |   | 19,967 |   |   |   | 19,373 |   |
| Goodwill                                                                   |   |   | 6,397 |   |   |   | 6,397 |   |
| Intangible assets, net                                                     |   |   | 2,272 |   |   |   | 2,577 |   |
| Other real estate owned                                                    |   |   | 7,849 |   |   |   | 5,592 |   |
| Other assets                                                               |   |   | 8,515 |   |   |   | 7,537 |   |
| Total assets                                                               |   | $ | 636,768 |   |   | $ | 610,551 |   |
| Liabilities, Redeemable Common Stock, and Stockholders' Equity             |   |   |   |   |   |   |   |   |
| Liabilities:                                                               |   |   |   |   |   |   |   |   |
| Deposits:                                                                  |   |   |   |   |   |   |   |   |
| Noninterest-bearing                                                        |   | $ | 79,821 |   |   | $ | 75,912 |   |
| Interest-bearing                                                           |   |   | 475,204 |   |   |   | 443,789 |   |
| Total deposits                                                             |   |   | 555,025 |   |   |   | 519,701 |   |
| Short-term borrowed funds                                                  |   |   | - |   |   |   | 15,115 |   |
| Long-term borrowed funds                                                   |   |   | 8,184 |   |   |   | 1,667 |   |
| Other liabilities                                                          |   |   | 9,844 |   |   |   | 9,546 |   |
| Total liabilities                                                          |   |   | 573,053 |   |   |   | 546,029 |   |
|                                                                       |   |   |   |   |   |   |   |   |
| Commitments and contingencies                                              |   |   |   |   |   |   |   |   |
|                                                                       |   |   |   |   |   |   |   |   |
| Redeemable common stock held by ESOP                                       |   |   | 524 |   |   |   | 494 |   |
|                                                                       |   |   |   |   |   |   |   |   |
| Stockholders' equity:                                                      |   |   |   |   |   |   |   |   |
| Common stock, par value $1; 10,000,000 shares authorized, 3,931,528 issued |   |   | 3,932 |   |   |   | 3,932 |   |
| Preferred stock, par value $1; 10,000,000 shares authorized, 0 issued      |   |   | - |   |   |   | - |   |
| Additional paid-in capital                                                 |   |   | 49,863 |   |   |   | 49,812 |   |
| Retained earnings                                                          |   |   | 9,278 |   |   |   | 9,700 |   |
| Unearned compensation - ESOP                                               |   |   | (303 | ) |   |   | (326 | ) |
| Accumulated other comprehensive income                                     |   |   | 421 |   |   |   | 910 |   |
| Total stockholders' equity                                                 |   |   | 63,191 |   |   |   | 64,028 |   |
| Total liabilities, redeemable common stock, and stockholders' equity       |   | $ | 636,768 |   |   | $ | 610,551 |   |

----

Index

| SouthCrest Financial Group, Inc. and Subsidiaries         |   |
|-----------------------------------------------------------|--------|
| Condensed Consolidated Statements of Income               |   |
| For The Three and Six Months Ended June 30, 2009 and 2008 |   |
| (Unaudited)                                               |   |
| (In thousands, except share and per share data)      |   |
|                                                      |   | Three Months |   |   | Six Months |   |
|                                                      |   | 2009 |   |   | 2008 |   |   | 2009 |   |   | 2008 |   |
| Interest income:                                          |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans                                                     |   | $ | 6,363 |   |   | $ | 6,802 |   |   | $ | 12,771 |   |   | $ | 14,173 |   |
| Securities - taxable                                      |   |   | 1,100 |   |   |   | 1,348 |   |   |   | 2,185 |   |   |   | 2,742 |   |
| Securities - nontaxable                                   |   |   | 213 |   |   |   | 229 |   |   |   | 432 |   |   |   | 458 |   |
| Federal funds sold                                        |   |   | 2 |   |   |   | 80 |   |   |   | 5 |   |   |   | 216 |   |
| Interest-bearing deposits at other banks                  |   |   | 146 |   |   |   | 126 |   |   |   | 294 |   |   |   | 250 |   |
| Total interest income                                     |   |   | 7,824 |   |   |   | 8,585 |   |   |   | 15,687 |   |   |   | 17,839 |   |
|                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest expense:                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Deposits                                                  |   |   | 2,541 |   |   |   | 3,250 |   |   |   | 5,153 |   |   |   | 6,832 |   |
| Other borrowings                                          |   |   | 63 |   |   |   | 74 |   |   |   | 129 |   |   |   | 208 |   |
| Total interest expense                                    |   |   | 2,604 |   |   |   | 3,324 |   |   |   | 5,282 |   |   |   | 7,040 |   |
|                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest income                                       |   |   | 5,220 |   |   |   | 5,261 |   |   |   | 10,405 |   |   |   | 10,799 |   |
| Provision for loan losses                                 |   |   | 1,363 |   |   |   | 1,115 |   |   |   | 2,237 |   |   |   | 1,470 |   |
| Net interest income after provision for loan losses       |   |   | 3,857 |   |   |   | 4,146 |   |   |   | 8,168 |   |   |   | 9,329 |   |
|                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other income:                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Service charges on deposit accounts                       |   |   | 892 |   |   |   | 1,005 |   |   |   | 1,683 |   |   |   | 1,962 |   |
| Other service charges and fees                            |   |   | 436 |   |   |   | 408 |   |   |   | 866 |   |   |   | 803 |   |
| Net gain on sale of loans                                 |   |   | 227 |   |   |   | 107 |   |   |   | 445 |   |   |   | 220 |   |
| Net gain (loss) on sale and call of securities            |   |   | (211 | ) |   |   | 29 |   |   |   | (201 | ) |   |   | 119 |   |
| Income on bank-owned life insurance                       |   |   | 163 |   |   |   | 168 |   |   |   | 330 |   |   |   | 349 |   |
| Other operating income                                    |   |   | 114 |   |   |   | 124 |   |   |   | 295 |   |   |   | 309 |   |
| Total other income                                        |   |   | 1,621 |   |   |   | 1,841 |   |   |   | 3,418 |   |   |   | 3,762 |   |
|                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other expenses:                                           |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Salaries and employee benefits                            |   |   | 2,782 |   |   |   | 2,903 |   |   |   | 6,048 |   |   |   | 5,743 |   |
| Equipment and occupancy expenses                          |   |   | 619 |   |   |   | 615 |   |   |   | 1,262 |   |   |   | 1,209 |   |
| Amortization of intangibles                               |   |   | 271 |   |   |   | 273 |   |   |   | 501 |   |   |   | 541 |   |
| Other operating expenses                                  |   |   | 2,103 |   |   |   | 1,471 |   |   |   | 3,719 |   |   |   | 2,901 |   |
| Total other expenses                                      |   |   | 5,775 |   |   |   | 5,262 |   |   |   | 11,530 |   |   |   | 10,394 |   |
|                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income (loss) before income taxes                         |   |   | (297 | ) |   |   | 725 |   |   |   | 56 |   |   |   | 2,697 |   |
| Income tax (benefit) expense                              |   |   | (186 | ) |   |   | 118 |   |   |   | (220 | ) |   |   | 685 |   |
| Net income (loss)                                         |   | $ | (111 | ) |   | $ | 607 |   |   | $ | 276 |   |   | $ | 2,012 |   |
|                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic and diluted earnings (loss) per share               |   | $ | (0.03 | ) |   | $ | 0.16 |   |   | $ | 0.07 |   |   | $ | 0.51 |   |
| Dividends per share                                       |   | $ | 0.04 |   |   | $ | 0.13 |   |   | $ | 0.17 |   |   | $ | 0.26 |   |
| Average shares outstanding - basic and diluted            |   |   | 3,917,742 |   |   |   | 3,916,358 |   |   |   | 3,917,227 |   |   |   | 3,916,003 |   |

----

Index

| SouthCrest Financial Group, Inc. and Subsidiaries                                                                                                   |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------|--------|
| Condensed Consolidated Statements of Comprehensive Income (Loss)                                                                                    |   |
| For The Three and Six Months Ended June 30, 2009 and 2008                                                                                           |   |
| (Unaudited)                                                                                                                                         |   |
| (In thousands)                                                                                                                                      |   |
|                                                                                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                |   | Three Months |   |   | Six Months |   |
|                                                                                                                                                |   | 2009 |   |   | 2008 |   |   | 2009 |   |   | 2008 |   |
|                                                                                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income (loss)                                                                                                                                   |   | $ | (111 | ) |   | $ | 607 |   |   | $ | 276 |   |   | $ | 2,012 |   |
|                                                                                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other comprehensive income (loss):                                                                                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Unrealized holding losses on securities available for sale arising during the period, net of taxes of  $(242), $(725), $(224), and $(446) |   |   | (393 | ) |   |   | (1,165 | ) |   |   | (364 | ) |   |   | (826 | ) |
| Reclassification adjustment for gains (losses) included in net income, net of tax of $(80), $11, $(76) and $45                                      |   |   | (131 | ) |   |   | 18 |   |   |   | (125 | ) |   |   | 74 |   |
| Comprehensive income (loss)                                                                                                                         |   | $ | (635 | ) |   | $ | (540 | ) |   | $ | (213 | ) |   | $ | 1,260 |   |

----

Index

| SouthCrest Financial Group, Inc.                      |   |
|-------------------------------------------------------|--------|
| And Subsidiaries                                      |   |
| Consolidated Statements of Stockholders' Equity       |   |
| For The Six Months Ended June 30, 2009 and 2008       |   |
| (Unaudited)                                           |   |
| (In thousands, except share and per share data)       |   |
|                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   | Accumulated |   |   |   |   |   |   |   |
|                                                  |   |   |   |   |   |   |   | Additional |   |   |   |   |   | Other |   |   | Unearned |   |   | Total |   |
|                                                  |   | Common Stock |   |   | Paid-In |   |   | Retained |   |   | Comprehensive |   |   | Compensation |   |   | Stockholders' |   |
|                                                  |   | Shares |   |   | Par |   |   | Capital |   |   | Earnings |   |   | Income (Loss) |   |   | (ESOP) |   |   | Equity |   |
|                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance, December 31, 2008                            |   |   | 3,931,528 |   |   | $ | 3,932 |   |   | $ | 49,812 |   |   | $ | 9,700 |   |   | $ | 910 |   |   | $ | (326 | ) |   | $ | 64,028 |   |
| Net income                                            |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 276 |   |   |   | - |   |   |   | - |   |   |   | 276 |   |
| Cash dividends declared, $.17 per share               |   |   | - |   |   |   | - |   |   |   | - |   |   |   | (668 | ) |   |   | - |   |   |   | - |   |   |   | (668 | ) |
| Stock-based compensation                              |   |   | - |   |   |   | - |   |   |   | 51 |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 51 |   |
| Adjustment for shares owned by ESOP                   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | (30 | ) |   |   | - |   |   |   | - |   |   |   | (30 | ) |
| Principal reduction of ESOP debt                      |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 23 |   |   |   | 23 |   |
| Other comprehensive income (loss)                     |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | (489 | ) |   |   | - |   |   |   | (489 | ) |
| Balance, June 30, 2009                                |   |   | 3,931,528 |   |   | $ | 3,932 |   |   | $ | 49,863 |   |   | $ | 9,278 |   |   | $ | 421 |   |   | $ | (303 | ) |   | $ | 63,191 |   |
|                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance, December 31, 2007                            |   |   | 3,931,528 |   |   | $ | 3,932 |   |   | $ | 49,707 |   |   | $ | 17,881 |   |   | $ | 550 |   |   | $ | (349 | ) |   | $ | 71,721 |   |
| Net income                                            |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 2,012 |   |   |   | - |   |   |   | - |   |   |   | 2,012 |   |
| Adjustment resulting from adoption of EITF Issue 06-4 |   |   | - |   |   |   | - |   |   |   | - |   |   |   | (493 | ) |   |   | - |   |   |   | - |   |   |   | (493 | ) |
| Cash dividends declared, $.26 per share               |   |   | - |   |   |   | - |   |   |   | - |   |   |   | (1,022 | ) |   |   | - |   |   |   | - |   |   |   | (1,022 | ) |
| Stock-based compensation                              |   |   | - |   |   |   | - |   |   |   | 53 |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 53 |   |
| Adjustment for shares owned by ESOP                   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 69 |   |   |   | - |   |   |   | - |   |   |   | 69 |   |
| Principal reduction of ESOP debt                      |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 23 |   |   |   | 23 |   |
| Other comprehensive income                            |   |   | - |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | (752 | ) |   |   | - |   |   |   | (752 | ) |
| Balance, June 30, 2008                                |   |   | 3,931,528 |   |   | $ | 3,932 |   |   | $ | 49,760 |   |   | $ | 18,447 |   |   | $ | (202 | ) |   | $ | (326 | ) |   | $ | 71,611 |   |

----

Index

| SouthCrest Financial Group, Inc. and Subsidiaries                                 |   |
|-----------------------------------------------------------------------------------|--------|
| Condensed Consolidated Statements of Cash Flows                                   |   |
| For The Six Months Ended June 30, 2009 and 2008                                   |   |
| (Unaudited)                                                                       |   |
| (In thousands)                                                                    |   |
|                                                                              |   | 2009 |   |   | 2008 |   |
| OPERATING ACTIVITIES                                                              |   |   |   |   |   |   |
| Net income                                                                        |   | $ | 276 |   |   | $ | 2,012 |   |
| Adjustments to reconcile net income to net cash provided by operating activities: |   |   |   |   |   |   |   |   |
| Depreciation                                                                      |   |   | 661 |   |   |   | 602 |   |
| Amortization of intangibles                                                       |   |   | 501 |   |   |   | 541 |   |
| Other amortization                                                                |   |   | (4 | ) |   |   | (15 | ) |
| Provision for loan losses                                                         |   |   | 2,237 |   |   |   | 1,470 |   |
| Stock compensation expense                                                        |   |   | 51 |   |   |   | 53 |   |
| Defined benefit plan expense                                                      |   |   | 400 |   |   |   | - |   |
| Deferred income taxes                                                             |   |   | (146 | ) |   |   | 417 |   |
| Income on bank-owned life insurance                                               |   |   | (330 | ) |   |   | (349 | ) |
| Loss (gain) on sales and calls of investment securities                           |   |   | 201 |   |   |   | (119 | ) |
| (Increase) decrease in interest receivable                                        |   |   | 122 |   |   |   | (633 | ) |
| Increase (decrease) in income taxes payable                                       |   |   | 358 |   |   |   | (606 | ) |
| Increase (decrease) in interest payable                                           |   |   | 534 |   |   |   | 206 |   |
| Net gain on sale of loans                                                         |   |   | (445 | ) |   |   | (220 | ) |
| Originations of mortgage loans held for sale                                      |   |   | (22,343 | ) |   |   | (10,236 | ) |
| Proceeds from sales of mortgage loans held for sale                               |   |   | 22,801 |   |   |   | 10,359 |   |
| Loss on sale of other real estate                                                 |   |   | 56 |   |   |   | - |   |
| (Increase) decrease in other assets                                               |   |   | (654 | ) |   |   | 356 |   |
| (Decrease) increase in other liabilities                                          |   |   | (994 | ) |   |   | 441 |   |
| Net cash provided by operating activities                                         |   |   | 3,282 |   |   |   | 4,279 |   |
| INVESTING ACTIVITIES                                                              |   |   |   |   |   |   |   |   |
| Proceeds from maturities of securities held to maturity                           |   |   | 6,939 |   |   |   | 21,166 |   |
| Purchases of securities held to maturity                                          |   |   | - |   |   |   | (5,113 | ) |
| Proceeds from maturities of securities available for sale                         |   |   | 22,127 |   |   |   | 17,194 |   |
| Purchases of securities available for sale                                        |   |   | (33,528 | ) |   |   | (31,662 | ) |
| Proceeds from sales of securities available for sale                              |   |   | 350 |   |   |   | - |   |
| Proceeds from redemption of restricted equity securities                          |   |   | 449 |   |   |   | 266 |   |
| Net increase in interest-bearing deposits in banks                                |   |   | (5,545 | ) |   |   | (5,272 | ) |
| Net increase in loans                                                             |   |   | (3,430 | ) |   |   | (9,956 | ) |
| Purchase of premises and equipment                                                |   |   | (1,255 | ) |   |   | (1,810 | ) |
| Proceeds from sale of other real estate owned                                     |   |   | 438 |   |   |   | 288 |   |
| Net cash used in investing activities                                             |   |   | (13,455 | ) |   |   | (14,899 | ) |
| FINANCING ACTIVITIES                                                              |   |   |   |   |   |   |   |   |
| Net increase in deposits                                                          |   |   | 35,324 |   |   |   | 14,728 |   |
| Repayments of short-term borrowed funds                                           |   |   | (8,598 | ) |   |   | (3,055 | ) |
| Leveraged ESOP transaction                                                        |   |   | 23 |   |   |   | 23 |   |
| Dividends paid                                                                    |   |   | (668 | ) |   |   | (1,022 | ) |
| Net cash provided by financing activities                                         |   |   | 26,081 |   |   |   | 10,674 |   |
| Net increase in cash and due from banks                                           |   |   | 15,908 |   |   |   | 54 |   |
| Cash and cash equivalents at beginning of year                                    |   |   | 26,043 |   |   |   | 25,376 |   |
| Cash and cash equivalents end of period                                           |   | $ | 41,951 |   |   | $ | 25,430 |   |

----

Index

| SouthCrest Financial Group, Inc. and Subsidiaries                  |   |
|--------------------------------------------------------------------|--------|
| Condensed Consolidated Statements of Cash Flows (continued)        |   |
| For The Six Months Ended June 30, 2009 and 2008                    |   |
| (Unaudited)                                                        |   |
| (In thousands)                                                     |   |
|                                                               |   | 2009 |   |   | 2008 |   |
|                                                               |   |   |   |   |   |   |
| SUPPLEMENTAL DISCLOSURES                                           |   |   |   |   |   |   |
| Cash paid for:                                                     |   |   |   |   |   |   |
| Interest                                                           |   | $ | 4,748 |   |   | $ | 6,834 |   |
| Income taxes                                                       |   |   | 368 |   |   |   | 1,406 |   |
|                                                               |   |   |   |   |   |   |   |   |
| NONCASH TRANSACTIONS                                               |   |   |   |   |   |   |   |   |
| Principal balances of loans transferred to other real estate owned |   | $ | 2,751 |   |   | $ | 1,451 |   |
| Increase in mortgage servicing rights                              |   |   | 196 |   |   |   | 104 |   |
| Increase (decrease) in redeemable common stock held by ESOP        |   |   | 30 |   |   |   | (69 | ) |
| Unrealized (loss) on securities available for sale, net            |   |   | (489 | ) |   |   | (752 | ) |

----

Index

anci

----

Index

|                                                        |   |      |   |   | Gross      |   |   | Gross      |   |   |   |   |
|-------------------------------------------------------------|--------|-----------|--------|--------|------------|--------|--------|------------|--------|--------|--------|--------|
|                                                        |   | Amortized |   |   | Unrealized |   |   | Unrealized |   |   | Fair   |   |
| (Dollars in thousands)                                      |   | Cost      |   |   | Gains      |   |   | Losses     |   |   | Value  |   |
|                                                        |   |      |   |   |       |   |   |       |   |   |   |   |
|                                                        |   |      |   |   |       |   |   |       |   |   |   |   |
| June 30, 2009:                                              |   |      |   |   |       |   |   |       |   |   |   |   |
| U.S. Government and agency securities                       |   | $         | 37,498 |   |       | $      | 356    |       |   | $      | (243   | )      |   | $ | 37,611 |   |
| State and municipal securities                              |   |      | 16,487 |   |       |   | 287    |       |   |   | (98    | )      |   |   | 16,676 |   |
| Mortgage-backed securities-government-sponsored enterprises |   |      | 31,653 |   |       |   | 866    |       |   |   | (34    | )      |   |   | 32,485 |   |
| Corporate bonds                                             |   |      | 1,962  |   |       |   | -      |       |   |   | (395   | )      |   |   | 1,567 |   |
| Equity Securities                                           |   |      | 623    |   |       |   | -      |       |   |   | (64    | )      |   |   | 559 |   |
|                                                        |   | $         | 88,223 |   |       | $      | 1,509  |       |   | $      | (834   | )      |   | $ | 88,898 |   |
|                                                        |   |      |   |   |       |   |   |       |   |   |   |   |   |   |   |   |
| December 31, 2008:                                          |   |      |   |   |       |   |   |       |   |   |   |   |   |   |   |   |
| U.S. Government and agency securities                       |   | $         | 25,702 |   |       | $      | 509    |       |   | $      | -      |   |   | $ | 26,211 |   |
| State and municipal securities                              |   |      | 16,648 |   |       |   | 262    |       |   |   | (135   | )      |   |   | 16,775 |   |
| Mortgage-backed securities-government-sponsored enterprises |   |      | 32,035 |   |       |   | 1,090  |       |   |   | (27    | )      |   |   | 33,098 |   |
| Corporate bonds and equity securities                       |   |      | 3,083  |   |       |   | 22     |       |   |   | (279   | )      |   |   | 2,826 |   |
|                                                        |   | $         | 76,648 |   |       | $      | 1,883  |       |   | $      | (441   | )      |   | $ | 78,910 |   |

----

Index

|                                                        |   |      |   |   | Gross      |   |   | Gross      |   |   |   |   |
|-------------------------------------------------------------|--------|-----------|--------|--------|------------|--------|--------|------------|--------|--------|--------|--------|
|                                                        |   | Amortized |   |   | Unrealized |   |   | Unrealized |   |   | Fair   |   |
| (Dollars in thousands)                                      |   | Cost      |   |   | Gains      |   |   | Losses     |   |   | Value  |   |
|                                                        |   |      |   |   |       |   |   |       |   |   |   |   |
| Securities Held to Maturity                                 |   |      |   |   |       |   |   |       |   |   |   |   |
| June 30, 2009:                                              |   |      |   |   |       |   |   |       |   |   |   |   |
| U.S. Government and agency securities                       |   | $         | -      |   |       | $      | -      |       |   | $      | -      |   |   | $ | - |   |
| State and municipal securities                              |   |      | 5,748  |   |       |   | 120    |       |   |   | (74    | )      |   |   | 5,794 |   |
| Mortgage-backed securities-government-sponsored enterprises |   |      | 25,486 |   |       |   | 449    |       |   |   | (9     | )      |   |   | 25,926 |   |
| Corporate bonds                                             |   |      | 1,000  |   |       |   | 17     |       |   |   | -      |   |   |   | 1,017 |   |
|                                                        |   | $         | 32,234 |   |       | $      | 586    |       |   | $      | (83    | )      |   | $ | 32,737 |   |
|                                                        |   |      |   |   |       |   |   |       |   |   |   |   |   |   |   |   |
| December 31, 2008:                                          |   |      |   |   |       |   |   |       |   |   |   |   |   |   |   |   |
| U.S. Government and agency securities                       |   | $         | 1,990  |   |       | $      | 28     |       |   | $      | -      |   |   | $ | 2,018 |   |
| State and municipal securities                              |   |      | 6,579  |   |       |   | 128    |       |   |   | (98    | )      |   |   | 6,609 |   |
| Mortgage-backed securities-government-sponsored enterprises |   |      | 29,647 |   |       |   | 369    |       |   |   | (187   | )      |   |   | 29,829 |   |
| Corporate bonds                                             |   |      | 1,000  |   |       |   | 46     |       |   |   | -      |   |   |   | 1,046 |   |
|                                                        |   | $         | 39,216 |   |       | $      | 571    |       |   | $      | (285   | )      |   | $ | 39,502 |   |

|                       |   | Securities Available For Sale |   |   | Securities Held To Maturity |   |
|----------------------------|--------|-------------------------------|--------|--------|-----------------------------|--------|
|                       |   | Amortized                     |   |   | Fair                        |   |   | Amortized |   |   | Fair |   |
| (Dollars in thousands)     |   | Cost                          |   |   | Value                       |   |   | Cost |   |   | Value |   |
|                       |   |                          |   |   |                        |   |   |   |   |   |   |   |
| Due within one year        |   | $                             | 2,978  |   |                        | $      | 3,013 |   |   | $ | 155 |   |   | $ | 158 |   |
| Due from one to five years |   |                          | 22,182 |   |                        |   | 22,571 |   |   |   | 1,379 |   |   |   | 1,399 |   |
| Due from five to ten years |   |                          | 20,233 |   |                        |   | 20,162 |   |   |   | 2,101 |   |   |   | 2,178 |   |
| Due after ten years        |   |                          | 8,591  |   |                        |   | 8,540 |   |   |   | 2,113 |   |   |   | 2,058 |   |
| Mortgage-backed securities |   |                          | 31,653 |   |                        |   | 32,485 |   |   |   | 25,486 |   |   |   | 25,927 |   |
| Equity securities          |   |                          | 2,586  |   |                        |   | 2,127 |   |   |   | 1,000 |   |   |   | 1,017 |   |
|                       |   | $                             | 88,223 |   |                        | $      | 88,898 |   |   | $ | 32,234 |   |   | $ | 32,737 |   |

----

Index

| (Dollars in thousands)                |   | Less Than 12 Months |   |   | 12 Months or More |   |   | Total  |   |
|---------------------------------------|--------|---------------------|--------|--------|-------------------|--------|--------|--------|--------|
| June 30, 2009:                        |   | Fair                |   |   | Unrealized        |   |   | Fair   |   |   | Unrealized |   |   | Fair |   |   | Unrealized |   |
| Description of securities             |   | Value               |   |   | Losses            |   |   | Value  |   |   | Losses |   |   | Value |   |   | Losses |   |
| U.S. Government and agency securities |   | $                   | 12,988 |   |              | $      | (243   | )      |   | $ | - |   |   | $ | - |   |   | $ | 12,988 |   |   | $ | (243 | ) |
| State and municipal securities        |   |                | 3,062  |   |              |   | (86    | )      |   |   | 565 |   |   |   | (86 | ) |   |   | 3,627 |   |   |   | (172 | ) |
| Mortgage-backed securities            |   |                | 6,742  |   |              |   | (40    | )      |   |   | 262 |   |   |   | (3 | ) |   |   | 7,004 |   |   |   | (43 | ) |
| Equity securities                     |   |                | -      |   |              |   | -      |   |   |   | 159 |   |   |   | (64 | ) |   |   | 159 |   |   |   | (64 | ) |
| Corporate bonds                       |   |                | 958    |   |              |   | (57    | )      |   |   | 609 |   |   |   | (338 | ) |   |   | 1,567 |   |   |   | (395 | ) |
| Total                                 |   | $                   | 23,750 |   |              | $      | (426   | )      |   | $ | 1,595 |   |   | $ | (491 | ) |   | $ | 25,345 |   |   | $ | (917 | ) |

| (Dollars in thousands)                |   | Less Than 12 Months |   |   | 12 Months or More |   |   | Total  |   |
|---------------------------------------|--------|---------------------|--------|--------|-------------------|--------|--------|--------|--------|
| December 31, 2008:                    |   | Fair                |   |   | Unrealized        |   |   | Fair   |   |   | Unrealized |   |   | Fair |   |   | Unrealized |   |
| Description of securities             |   | Value               |   |   | Losses            |   |   | Value  |   |   | Losses |   |   | Value |   |   | Losses |   |
| U.S. Government and agency securities |   | $                   | -      |   |              | $      | -      |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |
| State and municipal securities        |   |                | 2,940  |   |              |   | (147   | )      |   |   | 364 |   |   |   | (86 | ) |   |   | 3,304 |   |   |   | (233 | ) |
| Mortgage-backed securities            |   |                | 6,587  |   |              |   | (71    | )      |   |   | 5,858 |   |   |   | (143 | ) |   |   | 12,445 |   |   |   | (214 | ) |
| Equity securities                     |   |                | 1,021  |   |              |   | (102   | )      |   |   | - |   |   |   | - |   |   |   | 1,021 |   |   |   | (102 | ) |
| Corporate bonds                       |   |                | 767    |   |              |   | (177   | )      |   |   | - |   |   |   | - |   |   |   | 767 |   |   |   | (177 | ) |
| Total                                 |   | $                   | 11,315 |   |              | $      | (497   | )      |   | $ | 6,222 |   |   | $ | (229 | ) |   | $ | 17,537 |   |   | $ | (726 | ) |

----

Index

|                                    |   | June 30, |    |   | December 31, |   |
|-----------------------------------------|--------|----------|---------|--------|--------------|--------|
| (Dollars in thousands)                  |   | 2009     |    |   | 2008         |   |
| Commercial, financial, and agricultural |   | $        | 16,791  |   |         | $      | 18,740 |   |
| Real estate – construction        |   |     | 73,353  |   |         |   | 74,095 |   |
| Real estate – mortgage            |   |     | 265,496 |   |         |   | 261,866 |   |
| Consumer                                |   |     | 32,411  |   |         |   | 35,552 |   |
| Other                                   |   |     | 7,126   |   |         |   | 5,547 |   |
|                                    |   |     | 395,177 |   |         |   | 395,800 |   |
| Unearned income                         |   |     | (7      | )      |         |   | (12 | ) |
| Allowance for loan losses               |   |     | (8,105  | )      |         |   | (7,285 | ) |
| Loans, net                              |   | $        | 387,065 |   |         | $      | 388,503 |   |

|                                       |   | June 30, |   |   | December 31, |   |
|--------------------------------------------|--------|----------|--------|--------|--------------|--------|
| (Dollars in thousands)                     |   | 2009     |   |   | 2008         |   |
| Balance, beginning of year                 |   | $        | 7,285  |   |         | $      | 4,952 |   |
| Provision for loan losses                  |   |     | 2,237  |   |         |   | 4,002 |   |
| Loans charged off                          |   |     | (1,665 | )      |         |   | (2,244 | ) |
| Recoveries of loans previously charged off |   |     | 248    |   |         |   | 575 |   |
| Balance, end of year                       |   | $        | 8,105  |   |         | $      | 7,285 |   |

|                                          |   | June 30, |   |   | December 31, |   |
|-----------------------------------------------|--------|----------|--------|--------|--------------|--------|
| (Dollars in thousands)                        |   | 2009     |   |   | 2008         |   |
| Impaired loans without a valuation allowance  |   | $        | 3,572  |   |         | $      | - |   |
| Impaired loans with a valuation allowance     |   |     | 5,602  |   |         |   | 9,164 |   |
| Total impaired loans                          |   | $        | 9,174  |   |         | $      | 9,164 |   |
| Valuation allowance related to impaired loans |   | $        | 595    |   |         | $      | 1,603 |   |
| Average investment in impaired loans          |   | $        | 9,188  |   |         | $      | 5,920 |   |

|                                              |   | June 30, |   |   | December 31, |   |
|---------------------------------------------------|--------|----------|--------|--------|--------------|--------|
| (Dollars in thousands)                            |   | 2009     |   |   | 2008         |   |
| Nonaccrual loans                                  |   | $        | 9,174  |   |         | $      | 9,164 |   |
| Loans past due 90 days or more and still accruing |   | $        | 417    |   |         | $      | 779 |   |
| Loans restructured under troubled debt            |   | $        | 1,834  |   |         | $      | - |   |

----

Index

|                         |   | June 30, |    |   | December 31, |   |
|------------------------------|--------|----------|---------|--------|--------------|--------|
| (Dollars In Thousands)       |   | 2009     |    |   | 2008         |   |
|                         |   |     |    |   |         |   |
| Noninterest bearing deposits |   | $        | 79,821  |   |         | $      | 75,912 |   |
| Interest checking            |   |     | 99,973  |   |         |   | 95,979 |   |
| Money market                 |   |     | 56,943  |   |         |   | 54,545 |   |
| Savings                      |   |     | 45,730  |   |         |   | 42,651 |   |
| Certificates of deposit      |   |     | 272,558 |   |         |   | 250,614 |   |
|                         |   | $        | 555,025 |   |         | $      | 519,701 |   |

----

Index

----

Index

|   | Level 1 | Observable inputs such as quoted prices in active markets; |
|--------|---------|------------------------------------------------------------|

|   | Level 2 | Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and |
|--------|---------|----------------------------------------------------------------------------------------------------------------|

|   | Level 3 |  Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------|

----

Index

| (Dollars in thousands)                |   | Fair Value |   |   | Quoted Prices In Active Markets for Identical Assets (Level 1) |   |   | Significant Other Observable Inputs (Level 2) |   |   | Significant Observable Inputs (Level 3) |   |
|---------------------------------------|--------|------------|--------|--------|----------------------------------------------------------------|--------|--------|-----------------------------------------------|--------|--------|-----------------------------------------|--------|
| As of June 30, 2009                   |   |       |   |   |                                                           |   |   |                                          |   |   |                                    |   |
| U.S. Government and agency securities |   | $          | 37,611 |   |                                                           | $      | -      |                                          |   | $      | 37,611                                  |   |   | $ | - |   |
| State and municipal securities        |   |       | 16,676 |   |                                                           |   | -      |                                          |   |   | 16,676                                  |   |   |   | - |   |
| Mortgage-backed securities            |   |       | 32,485 |   |                                                           |   | -      |                                          |   |   | 32,485                                  |   |   |   | - |   |
| Corporate bonds                       |   |       | 1,567  |   |                                                           |   | -      |                                          |   |   | 1,567                                   |   |   |   | - |   |
| Equity securities                     |   |       | 559    |   |                                                           |   | 19     |                                          |   |   | -                                       |   |   |   | 540 |   |
|                                  |   | $          | 88,898 |   |                                                           | $      | 19     |                                          |   | $      | 88,338                                  |   |   | $ | 540 |   |
| As of December 31, 2008               |   |       |   |   |                                                           |   |   |                                          |   |   |                                    |   |   |   |   |   |
| U.S. Government and agency securities |   | $          | 26,211 |   |                                                           | $      | -      |                                          |   | $      | 26,211                                  |   |   | $ | - |   |
| State and municipal securities        |   |       | 16,775 |   |                                                           |   | -      |                                          |   |   | 16,775                                  |   |   |   | - |   |
| Mortgage-backed securities            |   |       | 33,098 |   |                                                           |   | -      |                                          |   |   | 33,098                                  |   |   |   | - |   |
| Corporate bonds                       |   |       | 1,805  |   |                                                           |   | -      |                                          |   |   | 1,805                                   |   |   |   | - |   |
| Equity securities                     |   |       | 1,021  |   |                                                           |   | 27     |                                          |   |   | -                                       |   |   |   | 994 |   |
|                                  |   | $          | 78,910 |   |                                                           | $      | 27     |                                          |   | $      | 77,089                                  |   |   | $ | 994 |   |

|                                        |   | Investment Securities |   |
|---------------------------------------------|--------|-----------------------|--------|
|                                        |   | Available For Sale    |   |
|                                        |   |                  |   |
| Beginning balance, January 1, 2009          |   | $                     | 994    |   |
| Total gains (losses) realized or unrealized |   |                  |   |   |
| Included in earnings                        |   |                  | (150   | ) |
| Included in other comprehensive income      |   |                  | 40     |   |
| Transfers in (out) of Level 3               |   |                  | (350   | ) |
| Ending balance, June 30, 2009               |   | $                     | 540    |   |

----

Index

| (Dollars in thousands) |   | Fair Value |   | Quoted Prices In Active Markets for Identical Assets (Level 1) |   | Significant Other Observable Inputs (Level 2) |   | Significant Unobservable Inputs (Level 3) |   |
|----------------------------------|--------|------------|--------|------------------------------------------------------------------------------------|--------|----------------------------------------------------|--------|------------------------------------------------|--------|
| As of June 30, 2009              |   |       |   |                                                                               |   |                                               |   |                                           |   |
| Impaired loans                   |   |       | $      | 5,007                                                                              |   |                                               | $      | -                                              |   |   | $ | - |   |   | $ | 5,007 |   |
| Other real estate                |   |       |   | 7,849                                                                              |   |                                               |   | -                                              |   |   |   | - |   |   |   | 7,849 |   |
|                             |   |       |   |                                                                               |   |                                               |   |                                           |   |   |   |   |   |   |   |   |   |
| As of December 31, 2008          |   |       |   |                                                                               |   |                                               |   |                                           |   |   |   |   |   |   |   |   |   |
| Impaired loans                   |   |       | $      | 7,561                                                                              |   |                                               | $      | -                                              |   |   | $ | - |   |   | $ | 7,561 |   |
| Other real estate                |   |       |   | 5,592                                                                              |   |                                               |   | -                                              |   |   |   | - |   |   |   | 5,592 |   |

|                                                                                   |   | June 30, 2009 |    |   | December 31, 2008 |   |
|----------------------------------------------------------------------------------------|--------|---------------|---------|--------|-------------------|--------|
|                                                                                   |   | Carrying      |    |   | Fair              |   |   | Carrying |   |   | Fair |   |
| (Dollars in thousands)                                                                 |   | Amount        |    |   | Value             |   |   | Amount |   |   | Value |   |
|                                                                                   |   |          |    |   |              |   |   |   |   |   |   |   |
| Financial assets                                                                       |   |          |    |   |              |   |   |   |   |   |   |   |
| Cash, due from banks, interest bearing deposits in other banks, and federal funds sold |   | $             | 64,369  |   |              | $      | 64,369 |   |   | $ | 42,806 |   |   | $ | 42,806 |   |
| Securities                                                                             |   |          | 121,132 |   |              |   | 121,635 |   |   |   | 118,149 |   |   |   | 118,412 |   |
| Restricted equity securities                                                           |   |          | 1,845   |   |              |   | 1,845 |   |   |   | 2,294 |   |   |   | 2,294 |   |
| Loans and loans held for sale, net                                                     |   |          | 387,205 |   |              |   | 391,925 |   |   |   | 396,136 |   |   |   | 399,408 |   |
| Accrued interest receivable                                                            |   |          | 2,817   |   |              |   | 2,817 |   |   |   | 2,939 |   |   |   | 2,939 |   |
| Bank-owned life insurance                                                              |   |          | 17,327  |   |              |   | 17,327 |   |   |   | 16,997 |   |   |   | 16,997 |   |
|                                                                                   |   |          |    |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Financial liabilities                                                                  |   |          |    |   |              |   |   |   |   |   |   |   |   |   |   |   |
| Deposits                                                                               |   |          | 555,025 |   |              |   | 560,616 |   |   |   | 519,701 |   |   |   | 524,136 |   |
| Short-term borrowings                                                                  |   |          | -       |   |              |   | - |   |   |   | 15,115 |   |   |   | 15,115 |   |
| Long-term borrowings                                                                   |   |          | 8,184   |   |              |   | 8,197 |   |   |   | 1,667 |   |   |   | 1,687 |   |
| Accrued interest payable                                                               |   |          | 2,461   |   |              |   | 2,461 |   |   |   | 1,927 |   |   |   | 1,927 |   |

----

Index

|                            |   | Three Months |   |   | Six Months |   |
|---------------------------------|--------|--------------|--------|--------|------------|--------|
| (dollars in thousands)          |   | 2009         |   |   | 2008       |   |   | 2009 |   |   | 2008 |   |
| FDIC Special Assessment         |   | $            | 284    |   |       | $      | - |   |   | $ | 284 |   |   | $ | - |   |
| FDIC premiums                   |   |         | 329    |   |       |   | 17 |   |   |   | 414 |   |   |   | 26 |   |
| Professional fees               |   |         | 158    |   |       |   | 195 |   |   |   | 429 |   |   |   | 305 |   |
| Director fees                   |   |         | 114    |   |       |   | 137 |   |   |   | 213 |   |   |   | 206 |   |
| Telephone, postage and supplies |   |         | 132    |   |       |   | 119 |   |   |   | 260 |   |   |   | 254 |   |
| Data processing expenses        |   |         | 466    |   |       |   | 414 |   |   |   | 861 |   |   |   | 756 |   |

----

Index

nageme

----

Index

|                         |   | June 30, |    |   | December 31, |   |    |   |   |
|------------------------------|--------|----------|---------|--------|--------------|--------|---------|--------|--------|
| (Dollars In Thousands)       |   | 2009     |    |   | 2008         |   |    | Change |   |
|                         |   |     |    |   |         |   |    |   |   |
| Noninterest bearing deposits |   | $        | 79,821  |   |         | $      | 75,912  |   |   | $ | 3,909 |   |
| Interest checking            |   |     | 99,973  |   |         |   | 95,979  |   |   |   | 3,994 |   |
| Money market                 |   |     | 56,943  |   |         |   | 54,545  |   |   |   | 2,398 |   |
| Savings                      |   |     | 45,730  |   |         |   | 42,651  |   |   |   | 3,079 |   |
| Certificates of deposit      |   |     | 272,558 |   |         |   | 250,614 |   |   |   | 21,944 |   |
|                         |   | $        | 555,025 |   |         | $      | 519,701 |   |   | $ | 35,324 |   |

|                                    |   | June 30, |    |   | December 31, |   |
|-----------------------------------------|--------|----------|---------|--------|--------------|--------|
| (Dollars in thousands)                  |   | 2009     |    |   | 2008         |   |
| Commercial, financial, and agricultural |   | $        | 16,791  |   |         | $      | 18,740 |   |
| Real estate – construction        |   |     | 73,353  |   |         |   | 74,095 |   |
| Real estate – mortgage            |   |     | 265,496 |   |         |   | 261,866 |   |
| Consumer                                |   |     | 32,411  |   |         |   | 35,552 |   |
| Other                                   |   |     | 7,126   |   |         |   | 5,547 |   |
|                                    |   |     | 395,177 |   |         |   | 395,800 |   |
| Unearned income                         |   |     | (7      | )      |         |   | (12 | ) |
| Allowance for loan losses               |   |     | (8,105  | )      |         |   | (7,285 | ) |
| Loans, net                              |   | $        | 387,065 |   |         | $      | 388,503 |   |

----

Index

|                                              |   | June 30, |   |   | December 31, |   |
|---------------------------------------------------|--------|----------|--------|--------|--------------|--------|
| (Dollars in thousands)                            |   | 2009     |   |   | 2008         |   |
| Nonaccrual loans                                  |   | $        | 9,174  |   |         | $      | 9,164 |   |
| Loans past due 90 days or more and still accruing |   | $        | 417    |   |         | $      | 779 |   |
| Loans restructured under troubled debt            |   | $        | 1,834  |   |         | $      | - |   |

|                                          |   | June 30, |   |   | December 31, |   |
|-----------------------------------------------|--------|----------|--------|--------|--------------|--------|
| (Dollars in thousands)                        |   | 2009     |   |   | 2008         |   |
| Impaired loans without a valuation allowance  |   | $        | 3,572  |   |         | $      | - |   |
| Impaired loans with a valuation allowance     |   |     | 5,602  |   |         |   | 9,164 |   |
| Total impaired loans                          |   | $        | 9,174  |   |         | $      | 9,164 |   |
| Valuation allowance related to impaired loans |   | $        | 595    |   |         | $      | 1,603 |   |
| Average investment in impaired loans          |   | $        | 9,188  |   |         | $      | 5,920 |   |

| (Dollars in thousands)                         |   |   |   |
|------------------------------------------------|--------|--------|--------|
| Construction and development loans             |   | $      | 7,140  |   |
| First mortgage                                 |   |   | 8,620  |   |
| Second mortgage and home equity line of credit |   |   | 656    |   |
| Nonresidential mortgage                        |   |   | 4,241  |   |
| Commercial                                     |   |   | 3,544  |   |
| Consumer                                       |   |   | 4,463  |   |
|                                           |   |   |   |   |
| Total                                          |   | $      | 28,664 |   |

----

Index

| Analysis of Allowance for Loan Losses                                                                                       |   |         |   |   |       |   |   |
|-----------------------------------------------------------------------------------------------------------------------------|--------|--------------|--------|--------|------------|--------|--------|
| For The Three and Six Months Ended June 30, 2009 and 2008                                                                   |   |         |   |   |       |   |   |
| (Dollars in thousands)                                                                                                      |   | Three Months |   |   | Six Months |   |
|                                                                                                                        |   | 2009         |   |   | 2008       |   |   | 2009 |   |   | 2008 |   |
|                                                                                                                        |   |         |   |   |       |   |   |   |   |   |   |   |
| Balance at beginning of period                                                                                              |   | $            | 7,490  |   |       | $      | 5,296  |   |   | $ | 7,285 |   |   | $ | 4,952 |   |
| Chargeoffs                                                                                                                  |   |         |   |   |       |   |   |   |   |   |   |   |   |   |   |   |
| Commercial loans                                                                                                            |   |         | 41     |   |       |   | 34     |   |   |   | 57 |   |   |   | 41 |   |
| Real estate - construction                                                                                                  |   |         | 380    |   |       |   | -      |   |   |   | 884 |   |   |   | 22 |   |
| Real estate - mortgage                                                                                                      |   |         | 238    |   |       |   | 76     |   |   |   | 343 |   |   |   | 104 |   |
| Consumer                                                                                                                    |   |         | 182    |   |       |   | 181    |   |   |   | 342 |   |   |   | 280 |   |
| Other                                                                                                                       |   |         | 20     |   |       |   | 26     |   |   |   | 39 |   |   |   | 59 |   |
| Total Chargeoffs                                                                                                            |   |         | 861    |   |       |   | 317    |   |   |   | 1,665 |   |   |   | 506 |   |
|                                                                                                                        |   |         |   |   |       |   |   |   |   |   |   |   |   |   |   |   |
| Recoveries                                                                                                                  |   |         |   |   |       |   |   |   |   |   |   |   |   |   |   |   |
| Commercial loans                                                                                                            |   |         | 3      |   |       |   | 2      |   |   |   | 16 |   |   |   | 7 |   |
| Real estate - construction                                                                                                  |   |         | -      |   |       |   | -      |   |   |   | - |   |   |   | 24 |   |
| Real estate - mortgage                                                                                                      |   |         | 7      |   |       |   | 25     |   |   |   | 10 |   |   |   | 41 |   |
| Consumer                                                                                                                    |   |         | 83     |   |       |   | 71     |   |   |   | 185 |   |   |   | 174 |   |
| Other                                                                                                                       |   |         | 20     |   |       |   | 14     |   |   |   | 37 |   |   |   | 44 |   |
| Total recoveries                                                                                                            |   |         | 113    |   |       |   | 112    |   |   |   | 248 |   |   |   | 290 |   |
|                                                                                                                        |   |         |   |   |       |   |   |   |   |   |   |   |   |   |   |   |
| Net (chargeoffs) recoveries                                                                                                 |   |         | (748   | )      |       |   | (205   | ) |   |   | (1,417 | ) |   |   | (216 | ) |
| Additions charged to operations                                                                                             |   |         | 1,363  |   |       |   | 1,115  |   |   |   | 2,237 |   |   |   | 1,470 |   |
| Balance at end of period                                                                                                    |   | $            | 8,105  |   |       | $      | 6,206  |   |   | $ | 8,105 |   |   | $ | 6,206 |   |
| Annualized ratio of net chargeoffs (recoveries)  during the period to average loans outstanding during the period |   |         | 0.76   | %      |       |   | 0.01   | % |   |   | 0.72 | % |   |   | 0.01 | % |

----

Index

----

Index

| Average Consolidated Balance Sheets and Net Interest Income Analysis |   |
|----------------------------------------------------------------------|--------|
| For the Three Month Periods Ended June 30,                           |   |
| (Dollars in thousands)                                               |   |
|                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                 |   | Average Balances (1) |   |   | Yields / Rates |   |   | Income / Expense |   |   | Increase |   |
|                                                                 |   | 2009 |   |   | 2008 |   |   | 2009 |   |   | 2008 |   |   | 2009 |   |   | 2008 |   |   | (Decrease) |   |
| Assets                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans, including fee income                                          |   | $ | 396,834 |   |   | $ | 381,479 |   |   |   | 6.50 | % |   |   | 7.17 | % |   | $ | 6,363 |   |   | $ | 6,802 |   |   | $ | (439 | ) |
| Taxable securities                                                   |   |   | 103,150 |   |   |   | 113,626 |   |   |   | 4.32 | % |   |   | 4.77 | % |   |   | 1,100 |   |   |   | 1,348 |   |   |   | (248 | ) |
| Nontaxable securities                                                |   |   | 22,688 |   |   |   | 23,157 |   |   |   | 3.81 | % |   |   | 3.98 | % |   |   | 213 |   |   |   | 229 |   |   |   | (16 | ) |
| Federal funds sold                                                   |   |   | 2,200 |   |   |   | 15,018 |   |   |   | 0.37 | % |   |   | 2.14 | % |   |   | 2 |   |   |   | 80 |   |   |   | (78 | ) |
| Interest bearing deposits in banks                                   |   |   | 21,041 |   |   |   | 14,010 |   |   |   | 2.81 | % |   |   | 3.62 | % |   |   | 146 |   |   |   | 126 |   |   |   | 20 |   |
| Total earning assets                                                 |   |   | 545,913 |   |   |   | 547,290 |   |   |   | 5.81 | % |   |   | 6.31 | % |   |   | 7,824 |   |   |   | 8,585 |   |   |   | (761 | ) |
| Cash and due from banks                                              |   |   | 33,803 |   |   |   | 14,949 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Allowance for loan losses                                            |   |   | (7,661 | ) |   |   | (5,312 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other assets                                                         |   |   | 60,316 |   |   |   | 61,906 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                                                                |   | $ | 632,371 |   |   | $ | 618,833 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Liabilities and Equity                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest bearing demand (2)                                          |   | $ | 154,746 |   |   | $ | 150,092 |   |   |   | 0.84 | % |   |   | 1.37 | % |   | $ | 321 |   |   | $ | 513 |   |   | $ | (192 | ) |
| Savings                                                              |   |   | 45,149 |   |   |   | 44,491 |   |   |   | 0.49 | % |   |   | 0.71 | % |   |   | 55 |   |   |   | 78 |   |   |   | (23 | ) |
| Certificates of deposit                                              |   |   | 272,388 |   |   |   | 254,338 |   |   |   | 3.22 | % |   |   | 4.20 | % |   |   | 2,165 |   |   |   | 2,659 |   |   |   | (494 | ) |
| Total interest bearing deposits                                      |   |   | 472,283 |   |   |   | 448,921 |   |   |   | 2.18 | % |   |   | 2.91 | % |   |   | 2,541 |   |   |   | 3,250 |   |   |   | (709 | ) |
| Borrowed funds                                                       |   |   | 8,314 |   |   |   | 6,610 |   |   |   | 3.07 | % |   |   | 4.50 | % |   |   | 63 |   |   |   | 74 |   |   |   | (11 | ) |
| Total interest bearing liabilities                                   |   |   | 480,597 |   |   |   | 455,531 |   |   |   | 2.20 | % |   |   | 2.93 | % |   |   | 2,604 |   |   |   | 3,324 |   |   |   | (720 | ) |
| Noninterest bearing demand deposits                                  |   |   | 76,410 |   |   |   | 79,533 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other liabilities                                                    |   |   | 10,750 |   |   |   | 10,332 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Redeemable common stock held by ESOP                                 |   |   | 483 |   |   |   | 895 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Shareholders' equity                                                 |   |   | 64,131 |   |   |   | 72,542 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                                                                |   | $ | 632,371 |   |   | $ | 618,833 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest income                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | $ | 5,220 |   |   | $ | 5,261 |   |   | $ | (41 | ) |
| Net interest yield on earning assets                                 |   |   |   |   |   |   |   | 3.88 | % |   |   | 3.87 | % |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest spread                                                  |   |   |   |   |   |   |   |   |   |   | 3.61 | % |   |   | 3.38 | % |   |   |   |   |   |   |   |   |   |   |   |   |

----

Index

| Average Consolidated Balance Sheets and Net Interest Income Analysis |   |
|----------------------------------------------------------------------|--------|
| For the Six Month Periods Ended June 30,                             |   |
| (Dollars in thousands)                                               |   |
|                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                 |   | Average Balances (1) |   |   | Yields / Rates |   |   | Income / Expense |   |   | Increase |   |
|                                                                 |   | 2009 |   |   | 2008 |   |   | 2009 |   |   | 2008 |   |   | 2009 |   |   | 2008 |   |   | (Decrease) |   |
| Assets                                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans, including fee income                                          |   | $ | 396,617 |   |   | $ | 377,609 |   |   |   | 6.49 | % |   |   | 7.55 | % |   | $ | 12,771 |   |   | $ | 14,173 |   |   | $ | (1,402 | ) |
| Taxable securities                                                   |   |   | 99,938 |   |   |   | 113,990 |   |   |   | 4.41 | % |   |   | 4.84 | % |   |   | 2,185 |   |   |   | 2,742 |   |   |   | (557 | ) |
| Nontaxable securities                                                |   |   | 22,905 |   |   |   | 23,466 |   |   |   | 3.80 | % |   |   | 3.92 | % |   |   | 432 |   |   |   | 458 |   |   |   | (26 | ) |
| Federal funds sold                                                   |   |   | 4,366 |   |   |   | 16,504 |   |   |   | 0.23 | % |   |   | 2.63 | % |   |   | 5 |   |   |   | 216 |   |   |   | (211 | ) |
| Interest bearing deposits in banks                                   |   |   | 19,906 |   |   |   | 12,928 |   |   |   | 2.98 | % |   |   | 3.89 | % |   |   | 294 |   |   |   | 250 |   |   |   | 44 |   |
| Total earning assets                                                 |   |   | 543,732 |   |   |   | 544,497 |   |   |   | 5.82 | % |   |   | 6.59 | % |   |   | 15,687 |   |   |   | 17,839 |   |   |   | (2,152 | ) |
| Cash and due from banks                                              |   |   | 30,439 |   |   |   | 14,968 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Allowance for loan losses                                            |   |   | (7,607 | ) |   |   | (5,167 | ) |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other assets                                                         |   |   | 59,251 |   |   |   | 61,317 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                                                                |   | $ | 625,815 |   |   | $ | 615,615 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Liabilities and Equity                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest bearing demand (2)                                          |   | $ | 154,918 |   |   | $ | 147,922 |   |   |   | 0.87 | % |   |   | 1.54 | % |   | $ | 667 |   |   | $ | 1,133 |   |   | $ | (466 | ) |
| Savings                                                              |   |   | 44,358 |   |   |   | 43,911 |   |   |   | 0.52 | % |   |   | 0.73 | % |   |   | 114 |   |   |   | 159 |   |   |   | (45 | ) |
| Certificates of deposit                                              |   |   | 267,295 |   |   |   | 253,506 |   |   |   | 3.30 | % |   |   | 4.39 | % |   |   | 4,372 |   |   |   | 5,540 |   |   |   | (1,168 | ) |
| Total interest bearing deposits                                      |   |   | 466,571 |   |   |   | 445,339 |   |   |   | 2.23 | % |   |   | 3.09 | % |   |   | 5,153 |   |   |   | 6,832 |   |   |   | (1,679 | ) |
| Borrowed funds                                                       |   |   | 8,938 |   |   |   | 8,054 |   |   |   | 2.91 | % |   |   | 5.19 | % |   |   | 129 |   |   |   | 208 |   |   |   | (79 | ) |
| Total interest bearing liabilities                                   |   |   | 475,509 |   |   |   | 453,393 |   |   |   | 2.24 | % |   |   | 3.12 | % |   |   | 5,282 |   |   |   | 7,040 |   |   |   | (1,758 | ) |
| Noninterest bearing demand deposits                                  |   |   | 75,729 |   |   |   | 78,593 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other liabilities                                                    |   |   | 10,067 |   |   |   | 10,402 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Redeemable common stock held by ESOP                                 |   |   | 479 |   |   |   | 920 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Shareholders' equity                                                 |   |   | 64,031 |   |   |   | 72,307 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total                                                                |   | $ | 625,815 |   |   | $ | 615,615 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest income                                                  |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   | $ | 10,405 |   |   | $ | 10,799 |   |   | $ | (394 | ) |
| Net interest yield on earning assets                                 |   |   |   |   |   |   |   | 3.86 | % |   |   | 3.99 | % |   |   |   |   |   |   |   |   |   |   |   |   |
| Net interest spread                                                  |   |   |   |   |   |   |   |   |   |   | 3.58 | % |   |   | 3.47 | % |   |   |   |   |   |   |   |   |   |   |   |   |

----

Index

|                        |   | Three Months |   |   | Six Months |   |
|-----------------------------|--------|--------------|--------|--------|------------|--------|
| (dollars in thousands)      |   | 2009         |   |   | 2008       |   |   | 2009 |   |   | 2008 |   |
|                        |   |         |   |   |       |   |   |   |   |   |   |   |
| Beginning balance           |   | $            | 578    |   |       | $      | 533 |   |   | $ | 525 |   |   | $ | 510 |   |
| Servicing rights recognized |   |         | 103    |   |       |   | 54 |   |   |   | 196 |   |   |   | 104 |   |
| Amortization expense        |   |         | (80    | )      |       |   | (31 | ) |   |   | (120 | ) |   |   | (58 | ) |
| Ending balance              |   | $            | 601    |   |       | $      | 556 |   |   | $ | 601 |   |   | $ | 556 |   |

----

Index

|                                    |   | Tier 1   |   |   | Tier 1 Risk- |   |   | Total Risk- |   |
|-----------------------------------------|--------|----------|--------|--------|--------------|--------|--------|-------------|--------|
|                                    |   | Leverage |   |   | Based        |   |   | Based       |   |
|                                    |   |     |   |   |         |   |   |        |   |
| Minimum required                        |   |     | 4.00   | %      |         |   | 4.00   | %           |   |   | 8.00 | % |
| Minimum required to be well capitalized |   |     | 5.00   | %      |         |   | 6.00   | %           |   |   | 10.00 | % |
| Actual ratios at June 30, 2009          |   |     |   |   |         |   |   |        |   |   |   |   |
| Consolidated                            |   |     | 8.86   | %      |         |   | 12.72  | %           |   |   | 13.98 | % |
| Bank of Upson                           |   |     | 9.55   | %      |         |   | 12.84  | %           |   |   | 14.10 | % |
| The First National Bank of Polk County  |   |     | 11.15  | %      |         |   | 17.07  | %           |   |   | 18.33 | % |
| Peachtree Bank                          |   |     | 8.87   | %      |         |   | 12.05  | %           |   |   | 13.29 | % |
| Bank of Chickamauga                     |   |     | 7.47   | %      |         |   | 13.67  | %           |   |   | 14.93 | % |

----

Index

|                                                         |   | Tier 1   |   |   | Tier 1 Risk- |   |   | Total Risk- |   |
|--------------------------------------------------------------|--------|----------|--------|--------|--------------|--------|--------|-------------|--------|
|                                                         |   | Leverage |   |   | Based        |   |   | Based       |   |
|                                                         |   |     |   |   |         |   |   |        |   |
| Minimum required                                             |   |     | 4.00   | %      |         |   | 4.00   | %           |   |   | 8.00 | % |
| Minimum required to be well capitalized                      |   |     | 5.00   | %      |         |   | 6.00   | %           |   |   | 10.00 | % |
| Pro forma ratios as of  June 30, 2009 Consolidated |   |     | 10.93  | %      |         |   | 15.70  | %           |   |   | 16.96 | % |

----

Index

| Commitments and Contractual Obligations |   |
|-----------------------------------------|--------|
| (Dollars in thousands)                  |   |
|                                    |   | Less than |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                    |   | one year |   |   | 1-3 years |   |   | 3-5 years |   |   | Thereafter |   |   | Total |   |
|                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Contractual obligations                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Deposits having no stated maturity      |   | $ | 282,467 |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | 282,467 |   |
| Certificates of Deposit                 |   |   | 211,261 |   |   |   | 41,090 |   |   |   | 20,207 |   |   |   | - |   |   |   | 272,558 |   |
| Long-term borrowed funds                |   |   | 1,489 |   |   |   | 2,561 |   |   |   | 4,135 |   |   |   | - |   |   |   | 8,185 |   |
| Deferred compensation                   |   |   | 43 |   |   |   | 289 |   |   |   | 588 |   |   |   | 4,296 |   |   |   | 5,216 |   |
| Leases                                  |   |   | 77 |   |   |   | 158 |   |   |   | 164 |   |   |   | 274 |   |   |   | 673 |   |
|                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total contractual obligations           |   | $ | 495,337 |   |   | $ | 44,098 |   |   | $ | 25,094 |   |   | $ | 4,570 |   |   | $ | 569,099 |   |
|                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Commitments                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Commitments to extend credit            |   | $ | 21,668 |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | 21,668 |   |
| Credit card commitments                 |   |   | 9,155 |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 9,155 |   |
| Commercial standby letters of credit    |   |   | 966 |   |   |   | - |   |   |   | - |   |   |   | - |   |   |   | 966 |   |
|                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total commitments                       |   | $ | 31,789 |   |   | $ | - |   |   | $ | - |   |   | $ | - |   |   | $ | 31,789 |   |

----

Index

uantita

tro

ORM

ceed

cto

| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
|---------|-------------------------------------------------------------|

faul

----

Index

bmiss

| Name                 |   | Term to Expire |   |   | Votes For |   |      | Votes Withheld |   |   | Broker Nonvotes |   |
|----------------------|--------|----------------|--------|--------|-----------|--------|-----------|----------------|--------|--------|-----------------|--------|
|                 |   |           |   |   |      |   |      |           |   |   |            |   |
| Zack D. Cravey, Jr.  |   |           | 2012   |   |      |   | 2,830,691 |           |   |   | 11,290          |   |   |   | 65,630 |   |
| Larry T. Kuglar      |   |           | 2012   |   |      |   | 2,841,029 |           |   |   | 952             |   |   |   | 65,630 |   |
| Michael D. McRae     |   |           | 2012   |   |      |   | 2,839,429 |           |   |   | 2,552           |   |   |   | 65,630 |   |
| Harold W. Wyatt, III |   |           | 2012   |   |      |   | 2,841,669 |           |   |   | 312             |   |   |   | 65,630 |   |

| Item 5. | Other Information |
|---------|-------------------|

hib

|   | Exhibit No. 31.1 | Chief Executive Officer Certification Pursuant to Rule 13a-14(a)/15d-14(a) |
|--------|------------------|----------------------------------------------------------------------------|

|   | Exhibit No. 31.2 | Chief Financial Officer Certification Pursuant to Rule 13a-14(a)/15d-14(a) |
|--------|------------------|----------------------------------------------------------------------------|

|   | Exhibit No. 32.1 | Chief Executive Officer Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
|--------|------------------|------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Exhibit No. 32.2 | Chief Financial Officer Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
|--------|------------------|------------------------------------------------------------------------------------------------------------------------------------------------|

----

Index

NATUR

|                             |   |   |   |                                           |
|----------------------------------|--------|--------|--------|------------------------------------------------|
| DATE:  August 14, 2009 |   | BY:    |   | /s/ Larry T. Kuglar                            |
|                             |   |   |   | Larry T. Kuglar.                               |
|                             |   |   |   | President and Chief Executive Officer          |
|                             |   |   |
| DATE:  August 14, 2009 |   | BY:    |   | /s/ Douglas J. Hertha                          |
|                             |   |   |   | Douglas J. Hertha                              |
|                             |   |   |   | Senior Vice President, Chief Financial Officer |

----