| Report      of Independent Registered Public Accounting Firm |   |   | F-1                   |   |
|--------------------------------------------------------------|--------|--------|-----------------------|--------|
|                                                         |   |   |                  |   |
| Consolidated      Balance Sheets                             |   |   | F-2                   |   |
|                                                         |   |   |                  |   |
| Consolidated      Statements of Earnings                     |   |   | F-3                   |   |
|                                                         |   |   |                  |   |
| Consolidated      Statements of Stockholders' Equity         |   |   | F-4                   |   |
|                                                         |   |   |                  |   |
| Consolidated      Statements of Cash Flows                   |   |   | F-5                   |   |
|                                                         |   |   |                  |   |
| Notes      to Consolidated Financial Statements              |   |   | F-6      – F-30 |   |

----

----

----

|                                                                                                                                        |   | December      31, |   |
|---------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------|--------|
|                                                                                                                                        |   | 2009              |   |   | 2008 |   |
| Assets                                                                                                                                      |   |              |   |   |   |   |
| Cash      and due from banks                                                                                                                |   | $                 | 771    |   |   |   | 983 |   |
| Federal      funds sold                                                                                                                     |   |              | 9,065  |   |   |   | 3,452 |   |
|                                                                                                                                        |   |              |   |   |   |   |   |   |
| Total      cash and cash equivalents                                                                                                        |   |              | 9,836  |   |   |   | 4,435 |   |
|                                                                                                                                        |   |              |   |   |   |   |   |   |
| Securities      available for sale                                                                                                          |   |              | 16,410 |   |   |   | 12,378 |   |
| Loans,      net of allowance for loan losses of $1,628 and $846                                                                             |   |              | 47,487 |   |   |   | 27,593 |   |
| Federal      Home Loan Bank stock, at cost                                                                                                  |   |              | 354    |   |   |   | 263 |   |
| Premises      and equipment, net                                                                                                            |   |              | 1,596  |   |   |   | 1,360 |   |
| Deferred      taxes                                                                                                                         |   |              | 2,370  |   |   |   | 1,247 |   |
| Foreclosed      real estate                                                                                                                 |   |              | 315    |   |   |   | - |   |
| Accrued      interest receivable                                                                                                            |   |              | 277    |   |   |   | 152 |   |
| Other      assets                                                                                                                           |   |              | 768    |   |   |   | 461 |   |
|                                                                                                                                        |   |              |   |   |   |   |   |   |
| Total      assets                                                                                                                           |   | $                 | 79,413 |   |   |   | 47,889 |   |
|                                                                                                                                        |   |              |   |   |   |   |   |   |
| Liabilities      and Stockholders' Equity                                                                                                   |   |              |   |   |   |   |   |   |
|                                                                                                                                        |   |              |   |   |   |   |   |   |
| Liabilities:                                                                                                                                |   |              |   |   |   |   |   |   |
| Noninterest-bearing      demand deposits                                                                                                    |   |              | 8,427  |   |   |   | 6,915 |   |
| Savings,      NOW and money-market deposits                                                                                                 |   |              | 15,362 |   |   |   | 8,447 |   |
| Time      deposits                                                                                                                          |   |              | 39,212 |   |   |   | 15,095 |   |
|                                                                                                                                        |   |              |   |   |   |   |   |   |
| Total      deposits                                                                                                                         |   |              | 63,001 |   |   |   | 30,457 |   |
|                                                                                                                                        |   |              |   |   |   |   |   |   |
| Federal      Home Loan Bank advances                                                                                                        |   |              | 6,000  |   |   |   | 5,000 |   |
| Other      borrowings                                                                                                                       |   |              | 342    |   |   |   | 1,055 |   |
| Accrued      interest payable                                                                                                               |   |              | 85     |   |   |   | 63 |   |
| Other      liabilities                                                                                                                      |   |              | 38     |   |   |   | 39 |   |
|                                                                                                                                        |   |              |   |   |   |   |   |   |
| Total      liabilities                                                                                                                      |   |              | 69,466 |   |   |   | 36,614 |   |
|                                                                                                                                        |   |              |   |   |   |   |   |   |
| Commitments      (Notes 5 and 10)                                                                                                           |   |              |   |   |   |   |   |   |
|                                                                                                                                        |   |              |   |   |   |   |   |   |
| Stockholders'      equity:                                                                                                                  |   |              |   |   |   |   |   |   |
|                                                                                                                                        |   |              |   |   |   |   |   |   |
| Preferred      stock, $.01 par value; 1,000,000 shares authorized, none issued or      outstanding                                          |   |              | -      |   |   |   | - |   |
| Common      stock, $.01 par value; 9,000,000 shares authorized, 1,379,566 and      1,334,840 shares issued and outstanding in 2009 and 2008 |   |              | 14     |   |   |   | 13 |   |
| Additional      paid-in capital                                                                                                             |   |              | 13,921 |   |   |   | 13,388 |   |
| Accumulated      deficit                                                                                                                    |   |              | (3,970 | ) |   |   | (2,301 | ) |
| Accumulated      other comprehensive (loss) income                                                                                          |   |              | (18    | ) |   |   | 175 |   |
|                                                                                                                                        |   |              |   |   |   |   |   |   |
| Total      stockholders' equity                                                                                                             |   |              | 9,947  |   |   |   | 11,275 |   |
| Total      liabilities and stockholders' equity                                                                                             |   | $                 | 79,413 |   |   |   | 47,889 |   |

----

|                                                                             |   | Year      Ended December 31, |      |
|----------------------------------------------------------------------------------|--------|------------------------------|-----------|
|                                                                             |   | 2009                         |      |   | 2008 |   |
| Interest      income:                                                            |   |                         |      |   |   |   |
| Loans                                                                            |   | $                            | 2,373     |   |   |   | 1,108 |   |
| Securities                                                                       |   |                         | 495       |   |   |   | 437 |   |
| Federal      funds sold                                                          |   |                         | 16        |   |   |   | 80 |   |
| Other                                                                            |   |                         | 2         |   |   |   | 90 |   |
|                                                                             |   |                         |      |   |   |   |   |   |
| Total      interest income                                                       |   |                         | 2,886     |   |   |   | 1,715 |   |
|                                                                             |   |                         |      |   |   |   |   |   |
| Interest      expense:                                                           |   |                         |      |   |   |   |   |   |
| Deposits                                                                         |   |                         | 1,137     |   |   |   | 467 |   |
| Borrowings                                                                       |   |                         | 148       |   |   |   | 80 |   |
|                                                                             |   |                         |      |   |   |   |   |   |
| Total      interest expense                                                      |   |                         | 1,285     |   |   |   | 547 |   |
|                                                                             |   |                         |      |   |   |   |   |   |
| Net      interest income                                                         |   |                         | 1,601     |   |   |   | 1,168 |   |
|                                                                             |   |                         |      |   |   |   |   |   |
| Provision      for loan losses                                                   |   |                         | 1,612     |   |   |   | 794 |   |
|                                                                             |   |                         |      |   |   |   |   |   |
| Net      interest (expense) income after provision for loan losses               |   |                         | (11       | ) |   |   | 374 |   |
|                                                                             |   |                         |      |   |   |   |   |   |
| Noninterest      income:                                                         |   |                         |      |   |   |   |   |   |
| Service      charges and fees on deposit accounts                                |   |                         | 172       |   |   |   | 100 |   |
| Gain      on sale of available-for-sale securities                               |   |                         | 495       |   |   |   | - |   |
| Other                                                                            |   |                         | 43        |   |   |   | 43 |   |
|                                                                             |   |                         |      |   |   |   |   |   |
| Total      noninterest income                                                    |   |                         | 710       |   |   |   | 143 |   |
|                                                                             |   |                         |      |   |   |   |   |   |
| Noninterest      expense:                                                        |   |                         |      |   |   |   |   |   |
| Salaries      and employee benefits                                              |   |                         | 1,556     |   |   |   | 1,363 |   |
| Occupancy      and equipment                                                     |   |                         | 789       |   |   |   | 598 |   |
| Data      processing                                                             |   |                         | 285       |   |   |   | 153 |   |
| Professional      fees                                                           |   |                         | 72        |   |   |   | 72 |   |
| Advertising                                                                      |   |                         | 78        |   |   |   | 75 |   |
| Other                                                                            |   |                         | 593       |   |   |   | 469 |   |
|                                                                             |   |                         |      |   |   |   |   |   |
| Total      noninterest expense                                                   |   |                         | 3,373     |   |   |   | 2,730 |   |
|                                                                             |   |                         |      |   |   |   |   |   |
| Loss      before income tax benefit                                              |   |                         | (2,674    | ) |   |   | (2,213 | ) |
|                                                                             |   |                         |      |   |   |   |   |   |
| Income      tax benefit                                                          |   |                         | 1,005     |   |   |   | 820 |   |
|                                                                             |   |                         |      |   |   |   |   |   |
| Net      loss                                                                    |   | $                            | (1,669    | ) |   |   | (1,393 | ) |
|                                                                             |   |                         |      |   |   |   |   |   |
| Loss      per share – basic and diluted                                    |   | $                            | (1.25     | ) |   |   | (1.04 | ) |
|                                                                             |   |                         |      |   |   |   |   |   |
| Weighted-average      number of common shares outstanding, basic anddiluted |   |                         | 1,339,105 |   |   |   | 1,334,840 |   |

----

|                                                                                      |   | Common      Stock |      |   | Additional |   |   |           |   |   | AccumulatedOtherComprehensive |   |   | Total        |   |
|-------------------------------------------------------------------------------------------|--------|-------------------|-----------|--------|------------|--------|--------|----------------|--------|--------|-------------------------------|--------|--------|--------------|--------|
|                                                                                      |   | Shares            |      |   | Amount     |   |   | Paid-InCapital |   |   | AccumulatedDeficit            |   |   | (Loss)Income |   |   | Stockholders’Equity |   |
| Balance      at December 31, 2007                                                         |   |              | 1,334,840 |   |       | $      | 13     |           |   |   | 13,286                        |   |   |         | (908   | ) |   |   | 8 |   |   |   | 12,399 |   |
|                                                                                      |   |              |      |   |       |   |   |           |   |   |                          |   |   |         |   |   |   |   |   |   |   |   |   |   |
| Comprehensive      loss:                                                                  |   |              |      |   |       |   |   |           |   |   |                          |   |   |         |   |   |   |   |   |   |   |   |   |   |
|                                                                                      |   |              |      |   |       |   |   |           |   |   |                          |   |   |         |   |   |   |   |   |   |   |   |   |   |
| Net      loss                                                                             |   |              | -         |   |       |   | -      |           |   |   | -                             |   |   |         | (1,393 | ) |   |   | - |   |   |   | (1,393 | ) |
|                                                                                      |   |              |      |   |       |   |   |           |   |   |                          |   |   |         |   |   |   |   |   |   |   |   |   |   |
| Net      change in unrealized gain on securities available for sale, net      of tax |   |              | -         |   |       |   | -      |           |   |   | -                             |   |   |         | -      |   |   |   | 167 |   |   |   | 167 |   |
|                                                                                      |   |              |      |   |       |   |   |           |   |   |                          |   |   |         |   |   |   |   |   |   |   |   |   |   |
| Comprehensive      loss                                                                   |   |              |      |   |       |   |   |           |   |   |                          |   |   |         |   |   |   |   |   |   |   |   | (1,226 | ) |
|                                                                                      |   |              |      |   |       |   |   |           |   |   |                          |   |   |         |   |   |   |   |   |   |   |   |   |   |
| Stock-based      compensation                                                             |   |              | -         |   |       |   | -      |           |   |   | 102                           |   |   |         | -      |   |   |   | - |   |   |   | 102 |   |
|                                                                                      |   |              |      |   |       |   |   |           |   |   |                          |   |   |         |   |   |   |   |   |   |   |   |   |   |
| Balance      at December 31, 2008                                                         |   |              | 1,334,840 |   |       |   | 13     |           |   |   | 13,388                        |   |   |         | (2,301 | ) |   |   | 175 |   |   |   | 11,275 |   |
|                                                                                      |   |              |      |   |       |   |   |           |   |   |                          |   |   |         |   |   |   |   |   |   |   |   |   |   |
| Common      stock warrants exercised, net of offering costs of$11                    |   |              | 44,726    |   |       |   | 1      |           |   |   | 436                           |   |   |         | -      |   |   |   | - |   |   |   | 437 |   |
|                                                                                      |   |              |      |   |       |   |   |           |   |   |                          |   |   |         |   |   |   |   |   |   |   |   |   |   |
| Comprehensive      loss:                                                                  |   |              |      |   |       |   |   |           |   |   |                          |   |   |         |   |   |   |   |   |   |   |   |   |   |
|                                                                                      |   |              |      |   |       |   |   |           |   |   |                          |   |   |         |   |   |   |   |   |   |   |   |   |   |
| Net      loss                                                                             |   |              | -         |   |       |   | -      |           |   |   | -                             |   |   |         | (1,669 | ) |   |   | - |   |   |   | (1,669 | ) |
|                                                                                      |   |              |      |   |       |   |   |           |   |   |                          |   |   |         |   |   |   |   |   |   |   |   |   |   |
| Net      change in unrealized gain on securities available for sale, net of      tax      |   |              | -         |   |       |   | -      |           |   |   | -                             |   |   |         | -      |   |   |   | (193 | ) |   |   | (193 | ) |
|                                                                                      |   |              |      |   |       |   |   |           |   |   |                          |   |   |         |   |   |   |   |   |   |   |   |   |   |
| Comprehensive      loss                                                                   |   |              |      |   |       |   |   |           |   |   |                          |   |   |         |   |   |   |   |   |   |   |   | (1,862 | ) |
|                                                                                      |   |              |      |   |       |   |   |           |   |   |                          |   |   |         |   |   |   |   |   |   |   |   |   |   |
| Stock-based      compensation                                                             |   |              | -         |   |       |   | -      |           |   |   | 97                            |   |   |         | -      |   |   |   | - |   |   |   | 97 |   |
|                                                                                      |   |              |      |   |       |   |   |           |   |   |                          |   |   |         |   |   |   |   |   |   |   |   |   |   |
| Balance      at December 31, 2009                                                         |   |              | 1,379,566 |   |       | $      | 14     |           |   |   | 13,921                        |   |   |         | (3,970 | ) |   |   | (18 | ) |   |   | 9,947 |   |

----

|                                                                                                                           |   | Year      Ended December 31, |    |
|--------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------|---------|
|                                                                                                                           |   | 2009                         |    |   | 2008 |   |
| Cash      flows from operating activities:                                                                                     |   |                         |    |   |   |   |
| Net      loss                                                                                                                  |   | $                            | (1,669  | ) |   |   | (1,393 | ) |
| Adjustments      to reconcile net loss to net cash used in operating      activities:                                          |   |                         |    |   |   |   |   |   |
| Depreciation      and amortization                                                                                             |   |                         | 381     |   |   |   | 291 |   |
| Provision      for loan losses                                                                                                 |   |                         | 1,612   |   |   |   | 794 |   |
| Stock-based      compensation                                                                                                  |   |                         | 97      |   |   |   | 102 |   |
| Deferred      income taxes                                                                                                     |   |                         | (1,005  | ) |   |   | (820 | ) |
| Increase      in accrued interest receivable                                                                                   |   |                         | (125    | ) |   |   | (102 | ) |
| (Increase)      decrease in other assets                                                                                       |   |                         | (307    | ) |   |   | 9 |   |
| (Decrease)      increase in other liabilities                                                                                  |   |                         | (1      | ) |   |   | - |   |
| Gain      on sale of securities available for sale                                                                             |   |                         | (495    | ) |   |   | - |   |
| Increase      in accrued interest payable                                                                                      |   |                         | 22      |   |   |   | 52 |   |
|                                                                                                                           |   |                         |    |   |   |   |   |   |
| Net      cash used in operating activities                                                                                     |   |                         | (1,490  | ) |   |   | (1,067 | ) |
|                                                                                                                           |   |                         |    |   |   |   |   |   |
| Cash      flows from investing activities:                                                                                     |   |                         |    |   |   |   |   |   |
| Purchase      of securities available for sale                                                                                 |   |                         | (20,950 | ) |   |   | (7,340 | ) |
| Proceeds      from maturities, calls and repayments of securities available for      sale                                      |   |                         | 4,707   |   |   |   | 1,600 |   |
| Proceeds      from sales of securities available for sale                                                                      |   |                         | 12,395  |   |   |   | - |   |
| Net      increase in loans                                                                                                     |   |                         | (21,821 | ) |   |   | (24,577 | ) |
| Purchase      of premises and equipment, net                                                                                   |   |                         | (617    | ) |   |   | (234 | ) |
| Purchase      of Federal Home Loan Bank stock                                                                                  |   |                         | (91     | ) |   |   | (247 | ) |
|                                                                                                                           |   |                         |    |   |   |   |   |   |
| Net      cash used in investing activities                                                                                     |   |                         | (26,377 | ) |   |   | (30,798 | ) |
|                                                                                                                           |   |                         |    |   |   |   |   |   |
| Cash      flows from financing activities:                                                                                     |   |                         |    |   |   |   |   |   |
| Net      increase in deposits                                                                                                  |   |                         | 32,544  |   |   |   | 18,837 |   |
| Proceeds      from Federal Home Loan Bank advances                                                                             |   |                         | 3,000   |   |   |   | 5,000 |   |
| (Decrease)      increase in other borrowings                                                                                   |   |                         | (713    | ) |   |   | 954 |   |
| Proceeds      from exercise of common stock warrants, net                                                                      |   |                         | 437     |   |   |   | - |   |
| Repayment      of Federal Home Loan Bank advances                                                                              |   |                         | (2,000  | ) |   |   | - |   |
|                                                                                                                           |   |                         |    |   |   |   |   |   |
| Net      cash provided by financing activities                                                                                 |   |                         | 33,268  |   |   |   | 24,791 |   |
|                                                                                                                           |   |                         |    |   |   |   |   |   |
| Net      increase (decrease) in cash and cash equivalents                                                                      |   |                         | 5,401   |   |   |   | (7,074 | ) |
|                                                                                                                           |   |                         |    |   |   |   |   |   |
| Cash      and cash equivalents at beginning of year                                                                            |   |                         | 4,435   |   |   |   | 11,509 |   |
|                                                                                                                           |   |                         |    |   |   |   |   |   |
| Cash      and cash equivalents at end of year                                                                                  |   | $                            | 9,836   |   |   |   | 4,435 |   |
|                                                                                                                           |   |                         |    |   |   |   |   |   |
| Supplemental      disclosure of cash flow information:                                                                         |   |                         |    |   |   |   |   |   |
| Cash      paid during the year for:                                                                                            |   |                         |    |   |   |   |   |   |
| Interest                                                                                                                       |   | $                            | 1,263   |   |   |   | 496 |   |
|                                                                                                                           |   |                         |    |   |   |   |   |   |
| Income      taxes                                                                                                              |   | $                            | -       |   |   |   | - |   |
|                                                                                                                           |   |                         |    |   |   |   |   |   |
| Noncash      investing activities:                                                                                             |   |                         |    |   |   |   |   |   |
| Accumulated      other comprehensive (loss) income, net change in unrealized gain      (loss) on securities available for sale |   | $                            | (193    | ) |   |   | 167 |   |
|                                                                                                                           |   |                         |    |   |   |   |   |   |
| Transfer      of loans to foreclosed real estate                                                                               |   | $                            | 315     |   |   |   | - |   |

----

|   | Organization.      Pro Financial Holdings, Inc. (the "Holding Company") owns 100% of      the outstanding common stock of Pro Bank (the "Bank"). The Holding      Company's primary activity is the operation of the Bank. The Bank is a      state (Florida)-chartered commercial bank. The Bank offers a variety of      banking and financial services to individual and corporate customers      through its three banking offices located in Tallahassee, Florida. The      deposit accounts of the Bank are insured up to applicable limits by the      Federal Deposit InsuranceCorporation. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Management      has evaluated events occurring subsequent to the balance sheet date      through March 10, 2010, determining no events require additional      disclosure in these consolidated financial  statements. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Basis      of Presentation.  The      accompanying consolidated financial statements include the accounts of the      Holding Company and the Bank (collectively, the "Company"). All      significant intercompany accounts and transactions have been eliminated in      consolidation. The accounting and reporting practices of the Company      conform to accounting principles generally accepted in the United States      of America and to general practices within the banking industry. The      following summarizes the more significant of these polices and      practices. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Use of      Estimates.  In preparing consolidated financial      statements in conformity with accounting principles generally accepted in      the United States of America, management is required to make estimates and      assumptions that affect the reported amounts of assets and liabilities as      of the date of the consolidated balance sheet and reported amounts of      revenues and expenses during the reporting period.  Actual      results could differ from those estimates.  Material estimates      that are particularly susceptible to significant change in the near term      relate to the determination of the allowance for loan losses and the      valuation of foreclosed real estate and deferred tax    assets. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Cash and      Cash Equivalents.  For purposes of the consolidated      statements of cash flows, cash and cash equivalents include cash and      balances due from banks and federal funds sold, all of which mature within      ninety days. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | At      December 31, 2009 and 2008, the Company was not required by law or      regulation to maintain cash reserves with the Federal Reserve Bank, in      accounts with other banks or in thevault. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (continued) |
|-------------|

----

|   | Securities.  Securities      may be classified as either trading, held to maturity or available for      sale. Trading securities are held principally for resale and recorded at      their fair values.  Unrealized gains and losses on trading      securities are included immediately in      operations.  Held-to-maturity securities are those which the      Company has the positive intent and ability to hold to maturity and are      reported at amortized cost.  Available-for-sale securities      consist of securities not classified as trading securities nor as      held-to-maturity securities.  Unrealized holding gains and      losses on available-for-sale securities, net of tax, are excluded from      operations and reported in accumulated other comprehensive (loss)      income.  Gains and losses on the sale of available-for-sale      securities are determined using the specific-identification method.      Premiums and discounts on securities available for sale are recognized in      interest income using the interest method over the period to      maturity. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Loans.  Loans      that management has the intent and ability to hold for the foreseeable      future or until maturity or pay-off are reported at their outstanding      principal adjusted for any charge-offs, the allowance for loan losses, and      any deferred fees or costs. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      accrual of interest on loans is discontinued at the time the loan is      ninety days delinquent unless the loan is well-collateralized and in      process of collection.  In all cases, loans are placed on      nonaccrual or charged-off at an earlier date if collection of principal or      interest is considered doubtful.  All interest accrued but not      collected for loans that are placed on nonaccrual or charged-off is      reversed against interest income.  The interest on these loans      is accounted for on the cash-basis or cost-recovery method, until      qualifying for return to accrual.  Loans are returned to accrual      status when all the principal and interest amounts contractually due are      brought current and future payments are reasonably  assured. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Allowance      for Loan Losses.  The allowance for loan losses is      established as losses are estimated to have occurred through a provision      for loan losses charged to operations.  Loan losses are charged      against the allowance when management believes the uncollectibility of a      loan balance is confirmed.  Subsequent recoveries, if any, are      credited to the allowance. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      allowance for loan losses is evaluated on a regular basis by management      and is based upon management's periodic review of the collectibility of      the loans in light of historical experience, the nature and volume of the      loan portfolio, adverse situations that may affect the borrower's ability      to repay, estimated value of any underlying collateral and prevailing      economic conditions. This evaluation is inherently subjective as it      requires estimates that are susceptible to significant revision as more      information becomes available. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | Allowance      for Loan Losses, Continued. The allowance consists of specific and      general components.  The specific component relates to loans      that are classified as impaired. For such loans, an allowance is      established when the discounted cash flows (or collateral value or      observable market price) of the impaired loan is lower than the carrying      value of that loan.  The general component covers nonimpaired      loans and is based on industry loss experience adjusted for qualitative      factors. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | A      loan is considered impaired when, based on current information and events,      it is probable the Company will be unable to collect the scheduled      payments of principal or interest when due according to the contractual      terms of the loan agreement.  Factors considered by management      in determining impairment include payment status, collateral value, and      the probability of collecting scheduled principal and interest payments      when due.  Loans that experience insignificant payment delays      and payment shortfalls generally are not classified as impaired.      Management determines the significance of payment delays and payment      shortfalls on a case-by-case basis, taking into consideration all of the      circumstances surrounding the loan and the borrower, including the length      of the delay, the reasons for the delay, the borrower's prior payment      record, and the amount of the shortfall in relation to the principal and      interest owed. Impairment is measured on a loan by loan basis for      commercial and commercial real estate loans by either the present value of      expected future cash flows discounted at the loan's effective interest      rate, the loan's obtainable market price, or the fair value of the      collateral if the loan is collateraldependent. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Large      groups of smaller balance homogeneous loans are collectively evaluated for      impairment.  Accordingly, the Company does not separately      identify individual consumer and residential loans for impairment      disclosures. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Premises      and Equipment.  Leasehold improvements and furniture,      fixtures and equipment are stated at cost, less accumulated depreciation      and amortization.  Depreciation and amortization expense is      computed using the straight-line method over the estimated useful life of      each asset or lease term, ifshorter. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Foreclosed      Real Estate.  Assets acquired through, or in lieu of,      loan foreclosure are to be sold and are initially recorded at the lower of      the related loan balance or the fair value less estimated selling costs at      the date of foreclosure establishing a new cost basis.  After      foreclosure, valuations are periodically performed by management and the      real estate is carried at the lower of carrying amount or fair value less      cost to sell.  Revenue and expenses from operations are included      in the consolidated statements ofoperations. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Transfer of      Financial Assets.  Transfers of financial assets are      accounted for as sales, when control over the assets has been      surrendered.  Control over transferred assets is deemed to be      surrendered when (1) the assets have been isolated from the Company, (2)      the transferee obtains the right (free of conditions that constrain it      from taking advantage of that right) to pledge or exchange the transferred      assets, and (3) the Company does not maintain effective control over the      transferred assets through an agreement to repurchase them before their      maturity. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |        |
|--------|-------------|
|   | (continued) |

----

|   | Income      Taxes.  On January 1, 2009, the Company adopted the      recent accounting guidance relating to accounting for uncertainty in      income taxes, which sets out a consistent framework to determine the      appropriate level of tax reserves to maintain for uncertain tax      positions. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      income tax accounting guidance results in two components of income tax      expense: current and deferred.  Current income tax expense      reflects taxes to be paid or refunded for the current period by applying      the provisions of the enacted tax law to the taxable income or excess of      deductions over revenues.  The Company determines deferred      income taxes using the liability (or balance sheet)      method.  Under this method, the net deferred tax asset or      liability is based on the tax effects of the differences between the book      and tax bases of assets and liabilities, and enacted changes in tax rates      and laws are recognized in the period in which they  occur. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Deferred      income taxes result from changes in deferred tax assets and liabilities      between periods. Deferred tax assets are recognized if it is more likely      than not, based on the technical merits, that the tax position will be      realized or sustained upon examination.  The term more likely      than not means a likelihood of more than 50 percent; the terms examined      and upon examination also include resolution of the related appeals or      litigation processes, if any.  A tax position that meets the      more-likely-than-not recognition threshold is initially and subsequently      measured as the largest amount of tax benefit that has a greater than 50      percent likelihood of being realized upon settlement with a taxing      authority that has full knowledge of all relevant      information.  The determination of whether or not a tax position      has met the more-likely-than-not recognition threshold considers the      facts, circumstances, and information available at the reporting date and      is subject to management's judgment.  Deferred tax assets are      reduced by a valuation allowance if, based on the weight of evidence      available, it is more likely than not that some portion or all of a      deferred tax asset will not be realized.  As of December 31,      2009, management is not aware of any uncertain tax positions that would      have a material effect on the Company's consolidated financial      statements. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      Company recognizes interest and penalties on income taxes as a component      of income taxes. |
|--------|---------------------------------------------------------------------------------------------------------|

|   | The      Holding Company and its subsidiary file consolidated income tax      returns.  Income taxes are allocated between the Holding Company      and its subsidiary as though separate income tax returns were      filed. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Advertising.      The Company expenses all media advertising as    incurred. |
|--------|------------------------------------------------------------------------------|

|   | Off-Balance-Sheet      Financial Instruments.  In the ordinary course of      business the Company has entered into off-balance-sheet financial      instruments consisting of undisbursed loans in process, unfunded lines of      credit and standby letters of credit. Such financial instruments are      recorded in the consolidated financial statements when they are      funded. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (continued) |
|--------|-------------|

----

|   | Comprehensive      Loss.  Accounting principles generally require that      recognized revenue, expenses, gains and losses be included in      operations.  Although certain changes in assets and liabilities,      such as unrealized gains and losses on available-for-sale securities, are      reported as a separate component of the equity section of the consolidated      balance sheet, such items, along with operations, are components of      comprehensive loss.  The components of accumulated other      comprehensive (loss) income and related tax effects are as follows (in      thousands): |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                              |   | Year      Ended December 31, |   |
|-------------------------------------------------------------------|--------|------------------------------|--------|
|                                                              |   | 2009                         |   |   | 2008 |   |
| Unrealized      holding gains on available for sale securities    |   | $                            | 184    |   |   |   | 274 |   |
| Reclassification      adjustment for gains realized in operations |   |                         | (495   | ) |   |   | - |   |
|                                                              |   |                         |   |   |   |   |   |   |
| Net      change in unrealized gains                               |   |                         | (311   | ) |   |   | 274 |   |
| Income      tax effect                                            |   |                         | 118    |   |   |   | (107 | ) |
|                                                              |   |                         |   |   |   |   |   |   |
| Net      unrealized gain (loss)                                   |   | $                            | (193   | ) |   |   | 167 |   |

|   | Stock-Based      Compensation.  The Company expenses the fair value of any      stock options granted.  The measurement and recognition of      compensation for all stock-based awards made to employees and directors      including stock options is based on estimated fair values.  The      Company recognizes stock-based compensation in salaries and employee      benefits for officers and employees and in other expense for directors in      the consolidated statements of operations.  The expense is      recognized on a straight-line basis over the vesting    period. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Loss Per      Share.  Loss per share ("EPS") of common stock has been      computed on the basis of the weighted-average number of shares of common      stock outstanding during the period. Outstanding stock options and      warrants were not considered dilutive securities for 2009 and 2008 due to      the net loss incurred by theCompany. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Fair Value      Measurements.  Generally Accepted Accounting Principles      ("GAAP") defines fair value, establishes a framework for measuring fair      value and enhances disclosures about fair value    measurements. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Fair      value is defined as the exchange price that would be received for an asset      or paid to transfer a liability (an exit price) in the principal or most      advantageous market for the asset or liability in an orderly transaction      between market participants on the measurement date. GAAP also establishes      a fair value hierarchy which requires an entity to maximize the use of      observable inputs and minimize the use of unobservable inputs when      measuring fair value. The standard describes three levels of inputs that      may be used to measure fair value: |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Level      1: Observable inputs such as quoted prices (unadjusted) in active markets      for identical assets orliabilities. |
|--------|-------------------------------------------------------------------------------------------------------------------------------|

|   |              |
|--------|-------------------|
|   |  (continued) |

----

|   | Fair Value      Measurements, Continued.  Level 2: Inputs other than      quoted prices that are observable for the asset or liability, either      directly or indirectly. These include quoted prices for similar assets or      liabilities in active markets; quoted prices for identical or similar      assets or liabilities that are not active; and model-driven valuations      whose inputs are observable or whose significant value drivers are      observable. Valuations may be obtained from, or corroborated by,      third-party pricing services. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Level      3: Unobservable inputs to measure fair value of assets and liabilities for      which there is little, if any market activity at the measurement date,      using reasonable inputs and assumptions based upon the best information at      the time, to the extent that inputs are available without undue cost and      effort. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      following describes valuation methodologies used for assets measured at      fair value: |
|--------|---------------------------------------------------------------------------------------------------|

|   | Securities Available for      Sale.  Where quoted prices are available in an active      market, securities are classified within Level 1 of the valuation      hierarchy. Level 1 securities include highly liquid government bonds,      certain mortgage products and exchange-traded equities. If quoted market      prices are not available, then fair values are estimated by using pricing      models, quoted prices of securities with similar characteristics, or      discounted cash flows.  Examples of such instruments, which      would generally be classified within Level 2 of the valuation hierarchy,      include certain collateralized mortgage and debt obligations and certain      high-yield debt securities. In certain cases where there is limited      activity or less transparency around inputs to the valuation, securities      are classified within Level 3 of the valuation hierarchy. Securities      classified within Level 3 include certain residual interests in      securitizations and other less liquid  securities. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Impaired      Loans.  The Company's impaired loans are normally      collateral dependent and, as such, are carried at the lower of the      Company's net recorded investment in the loan or the fair value of the      collateral less estimated selling costs.  Estimates of fair      value are determined based on a variety of information, including the use      of available appraisals, estimates of market value by licensed appraisers      or local real estate brokers and the knowledge and experience of the      Company's management related to values of properties in the Company's      market areas. Management takes into consideration the type, location and      occupancy of the property as well as current economic conditions in the      area the property is located in assessing estimates of fair value.      Accordingly, fair value estimates for impaired loans are classified as      Level 3. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Foreclosed Real Estate.       The      Company's foreclosed real estate is recorded at lower of cost or fair      market value less estimated selling costs.  Estimates of fair      values are determined based on a variety of information, including the use      of available appraisals, estimates of market value by licensed appraisers      or local real estate brokers and the knowledge and experience of the      Company's management related to values of properties in the Company's      market areas. Management takes into consideration the type, location and      occupancy of the property as well as current economic conditions in the      area the property is located in assessing estimates of fair      value.  Accordingly, the fair values estimates for foreclosed      real estate are classified as Level3. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (continued) |
|--------|-------------|

----

|   | Fair Values      of Financial Instruments.  The following methods and      assumptions were used by the Company in estimating fair values of      financial instruments: |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Cash and      Cash Equivalents.  The carrying amounts of these      financial instruments approximate their fair  value. |
|--------|------------------------------------------------------------------------------------------------------------------------------------|

|   | Securities.  The      fair value for securities available for sale are based on the framework      for measuring fair value. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------|

|   | Loans.  For      variable-rate loans that reprice frequently and have no significant change      in credit risk, fair values are based on carrying values.  Fair      values for certain fixed-rate residential mortgage, commercial real estate      and commercial loans are estimated using discounted cash flow analyses,      using interest rates currently being offered for loans with similar terms      to borrowers of similar credit quality.  Fair value for impaired      loans are based on the framework for measuring fair  value. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Federal      Home Loan Bank Stock.  Fair value of the Company's      investment in Federal Home Loan Bank stock is based on its redemption      value, which is its cost of $100 pershare. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Deposits.  The      fair values disclosed for demand, NOW, money-market and savings deposits      are, by definition, equal to the amount payable on demand at the reporting      date (that is, their carrying amounts).  Fair values for      fixed-rate time deposits are estimated using a discounted cash flow      calculation that applies interest rates currently being offered on time      deposits to a schedule of aggregated expected monthly maturities of time      deposits. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Federal      Home Loan Bank Advances. Fair value of the advances from the      Federal Home Loan  Bank are estimated using a discounted cash      flow analysis based on the Company's current incremental borrowing rate      for similar types of borrowings. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Other      Borrowings. The carrying amounts of other borrowings approximates      their fair value. |
|--------|-----------------------------------------------------------------------------------------------------|

|   | Accrued      Interest.  The carrying amounts of accrued interest      approximate their fair values. |
|--------|----------------------------------------------------------------------------------------------------------------|

|   | Off-Balance-Sheet      Financial Instruments.  Fair values for off-balance-sheet      lending commitments are based on fees currently charged to enter into      similar agreements, taking into account the remaining terms of the      agreements and the counterparties' credit  standing. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |  (continued) |
|--------|-------------------|

----

|   | Recent      Pronouncements. In 2009, the FASB Accounting Standards Codification      ("ASC") became the single source of authoritative GAAP in the United      States of America recognized by the Financial Accounting Standards Board      ("FASB") to be applied to nongovernmental entities.  Rules and      interpretive releases of the Securities and Exchange Commission ("SEC")      are also sources of authoritative GAAP for SEC registrants.  The      ASC superseded all existing non-SEC accounting and reporting standards.      All other nongrandfathered non-SEC accounting literature not included in      the ASC is nonauthoritative.  The Company's policies were not      affected by the conversion to ASC. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | In      2009, the FASB issued Statement of Financial Accounting Standards ("SFAS")      No. 166, Accounting      for Transfers of Financial Assets – an amendment of FASB Statement      No. 140, ("SFAS No. 166") (this SFAS was incorporated      into the ASC on January 1, 2010) amending the accounting for the transfers      of financial assets. This new standard enhances reporting about transfers      of financial assets, including loan participations and securitizations,      and where companies have continuing exposure to the risks related to      transferred financial assets. It eliminates the concept of a "qualifying      special-purpose entity" and changes the requirements for derecognizing      financial assets. It also requires additional disclosures about all      continuing involvements with transferred financial assets including      information about gains and losses resulting from transfers during the      period. The standard was effective January 1, 2010 and had no impact      on the Company's consolidated financial  statements. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | In      2009, the FASB issued SFAS No. 167, Amendments to FASB      Interpretation No. 46(R), ("SFAS No. 167") (this SFAS was      incorporated into the ASC on January 1, 2010) on how a company determines      when an entity that is insufficiently capitalized or is not controlled      through voting (or similar rights) should be consolidated. The      determination of whether a company is required to consolidate an entity is      based on, among other things, an entity's purpose and design and a      company's ability to direct the activities of the entity that most      significantly impact the entity's economic performance. The standard      requires additional disclosures about the reporting entity's involvement      with variable-interest entities and any significant changes in risk      exposure due to that involvement as well as its effect on the entity's      financial statements. The standard was effective January 1, 2010 and      had no impact on the Company's consolidated financial      statements. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Reclassifications.  Certain      amounts in the 2008 consolidated financial statements were reclassified to      conform to the 2009 presentation. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (continued) |
|--------|-------------|

----

|   | Securities      have been classified according to management's intent.  The      carrying amount of securities available for sale and their approximate      fair values are as follows (inthousands): |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                   |   | AmortizedCost |   |   | UnrealizedGains |   |   | UnrealizedLosses |   |   | FairValue |   |
|----------------------------------------|--------|---------------|--------|--------|-----------------|--------|--------|------------------|--------|--------|-----------|--------|
| At      December 31, 2009:             |   |          |   |   |            |   |   |             |   |   |      |   |
| U.S.      Government agency securities |   | $             | 3,000  |   |            |   | -      |             |   |   | (58       | )      |   |   | 2,942 |   |
| Corporate      bonds                   |   |          | 4,144  |   |            |   | 1      |             |   |   | (23       | )      |   |   | 4,122 |   |
| Mortgage-backed      securities        |   |          | 9,295  |   |            |   | 73     |             |   |   | (22       | )      |   |   | 9,346 |   |
|                                   |   |          |   |   |            |   |   |             |   |   |      |   |   |   |   |   |
| Total                                  |   | $             | 16,439 |   |            |   | 74     |             |   |   | (103      | )      |   |   | 16,410 |   |
|                                   |   |          |   |   |            |   |   |             |   |   |      |   |   |   |   |   |
| At      December 31, 2008:             |   |          |   |   |            |   |   |             |   |   |      |   |   |   |   |   |
| U.S.      Government agency securities |   |          | 1,500  |   |            |   | 26     |             |   |   | -         |   |   |   | 1,526 |   |
| Mortgage-backed      securities        |   |          | 10,596 |   |            |   | 288    |             |   |   | (32       | )      |   |   | 10,852 |   |
|                                   |   |          |   |   |            |   |   |             |   |   |      |   |   |   |   |   |
| Total                                  |   | $             | 12,096 |   |            |   | 314    |             |   |   | (32       | )      |   |   | 12,378 |   |

|   | Securities      sold are as follows (in thousands): |
|--------|-----------------------------------------------------|

|                |   | Year      Ended December 31, |   |
|---------------------|--------|------------------------------|--------|
|                |   | 2009                         |   |   | 2008 |   |
|                |   |                         |   |   |   |   |
| Gross      proceeds |   | $                            | 12,395 |   |   |   | - |   |
|                |   |                         |   |   |   |   |   |   |
| Gross      gains    |   | $                            | 495    |   |   |   | - |   |

|                               |   |                                     |   |   | Fair      Value Measurements Using                                       |   |
|------------------------------------|--------|------------------------------------------|--------|--------|--------------------------------------------------------------------------|--------|
|                               |   | FairValueAs      ofDecember      31,2009 |   |   | Quoted      PricesIn      ActiveMarkets      forIdenticalAssets(Level 1) |   |   | SignificantOtherObservableInputs(Level 2) |   |   |  SignificantUnobservableInputs(Level 3) |   |
| Available-for-sale      securities |   | $                                        | 16,410 |   |                                                                     |   | 4,122 |   |   |   | 12,288 |   |   |   | - |   |

----

|                              |   | AmortizedCost |   |   | FairValue |   |
|-----------------------------------|--------|---------------|--------|--------|-----------|--------|
|                              |   |          |   |   |      |   |
| Due      from one-to-five years   |   | $             | 4,144  |   |      |   | 4,122 |   |
| Due      in five to fifteen years |   |          | 3,000  |   |      |   | 2,942 |   |
| Mortgage-backed      securities   |   |          | 9,295  |   |      |   | 9,346 |   |
|                              |   |          |   |   |      |   |   |   |
| Total                             |   | $             | 16,439 |   |      |   | 16,410 |   |

|   | Securities      available for sale with a carrying value of $7.7 million and $8.5 million      at December 31, 2009 and 2008, respectively were pledged to secure Federal      Home Loan Bank advances and otherborrowings. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Securities      with gross unrealized losses at December 31, 2009, aggregated by      investment category and length of time that individual securities have      been in a continuous loss position, is as follows (in      thousands): |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                     |   | Less      Than Twelve Months |   |
|------------------------------------------|--------|------------------------------|--------|
|                                     |   | GrossUnrealizedLosses        |   |   | FairValue |   |
| U.S.      Government agency securities   |   | $                            | 58     |   |   |   | 2,942 |   |
| Corporate      bonds                     |   |                         | 23     |   |   |   | 3,093 |   |
| Mortgage-backed      securities          |   |                         | 22     |   |   |   | 2,653 |   |
|                                     |   |                         |   |   |   |   |   |   |
| Total      securities available for sale |   | $                            | 103    |   |   |   | 8,688 |   |

|   | Management      evaluates securities for other-than-temporary impairment at least on a      quarterly basis, and more frequently when economic or market concerns      warrant such evaluation.  Consideration is given to (1) the      length of time and the extent to which the fair value has been less than      cost, (2) the financial condition and near-term prospects of the issuer,      and (3) the intent and ability of the Company to retain its investment in      the issuer for a period of time sufficient to allow for any anticipated      recovery in fair value. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      unrealized losses on eight securities available for sale were caused by      market conditions. It is expected that the securities would not be settled      at a price less than the par value of the investments.  Because      the decline in fair value is attributable to changes in market conditions      and not credit quality, and because the Company has the ability and intent      to hold these investments until a market price recovery or maturity, these      investments are not considered other-than-temporarily      impaired. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                 |   | At      December 31, |   |
|--------------------------------------|--------|----------------------|--------|
|                                 |   | 2009                 |   |   | 2008 |   |
|                                 |   |                 |   |   |   |   |
| Commercial      real estate          |   | $                    | 35,595 |   |   |   | 16,232 |   |
| Residential      real estate         |   |                 | 5,634  |   |   |   | 4,949 |   |
| Commercial                           |   |                 | 5,528  |   |   |   | 5,010 |   |
| Consumer                             |   |                 | 2,459  |   |   |   | 2,312 |   |
|                                 |   |                 |   |   |   |   |   |   |
| Total      loans                     |   |                 | 49,216 |   |   |   | 28,503 |   |
|                                 |   |                 |   |   |   |   |   |   |
| Deduct:      Deferred loan fees, net |   |                 | (101   | ) |   |   | (64 | ) |
| Allowance      for loan losses       |   |                 | (1,628 | ) |   |   | (846 | ) |
|                                 |   |                 |   |   |   |   |   |   |
| Loans,      net                      |   | $                    | 47,487 |   |   |   | 27,593 |   |

|   | A      credit risk concentration results when the Company has a significant      credit exposure to an individual or a group engaged in similar activities      or having similar economic characteristics that would cause their ability      to meet contractual obligations to be similarly affected by changes in      economic or other conditions. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      Company grants the majority of its loans to borrowers throughout the Leon      County, Florida area. Although the Company has a diversified loan      portfolio, a significant portion of its borrowers' ability to honor their      contracts is dependent upon the economy in Leon County,      Florida. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | An      analysis of the change in the allowance for loan losses follows (in      thousands): |
|--------|----------------------------------------------------------------------------------------------|

|                           |   | Year      Ended December 31, |   |
|--------------------------------|--------|------------------------------|--------|
|                           |   | 2009                         |   |   | 2008 |   |
|                           |   |                         |   |   |   |   |
| Beginning      balance         |   | $                            | 846    |   |   |   | 72 |   |
| Provision      for loan losses |   |                         | 1,612  |   |   |   | 794 |   |
| Net      charge-offs           |   |                         | (830   | ) |   |   | (20 | ) |
|                           |   |                         |   |   |   |   |   |   |
| Ending      balance            |   | $                            | 1,628  |   |   |   | 846 |   |

----

|   | The      following summarizes the amount of impaired loans (in      thousands): |
|--------|---------------------------------------------------------------------------------|

|                                                          |   | At      December 31, |   |
|---------------------------------------------------------------|--------|----------------------|--------|
|                                                          |   | 2009                 |   |   | 2008 |   |
| Collateral      dependent loans identified as impaired:       |   |                 |   |   |   |   |
| Gross      loans with no related allowance for losses         |   | $                    | 1,524  |   |   |   | - |   |
|                                                          |   |                 |   |   |   |   |   |   |
| Gross      loans with related allowance for losses recorded   |   |                 | 2,543  |   |   |   | - |   |
| Less      allowances on these loans                           |   |                 | (558   | ) |   |   | - |   |
|                                                          |   |                 |   |   |   |   |   |   |
| Net      loans with related allowance                         |   |                 | 1,985  |   |   |   | - |   |
|                                                          |   |                 |   |   |   |   |   |   |
| Net      investment in collateral dependent impaired loans    |   |                 | 3,509  |   |   |   | - |   |
|                                                          |   |                 |   |   |   |   |   |   |
| Noncollateral      dependent loans identified as impaired:    |   |                 |   |   |   |   |   |   |
| Gross      loans with no related allowance for losses         |   |                 | -      |   |   |   | - |   |
|                                                          |   |                 |   |   |   |   |   |   |
| Gross      loans with related allowance for losses recorded   |   |                 | 536    |   |   |   | 536 |   |
| Less      allowance on these loans                            |   |                 | (536   | ) |   |   | (536 | ) |
|                                                          |   |                 |   |   |   |   |   |   |
| Net      loans with related allowance                         |   |                 | -      |   |   |   | - |   |
|                                                          |   |                 |   |   |   |   |   |   |
| Net      investment in noncollateral dependent impaired loans |   |                 | -      |   |   |   | - |   |
|                                                          |   |                 |   |   |   |   |   |   |
| Net      investment in impaired loans                         |   | $                    | 3,509  |   |   |   | - |   |

|   | The      average net investment in impaired loans and interest income recognized      and received on impaired loans is as follows (in    thousands): |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                              |   | Year      Ended December 31, |   |
|---------------------------------------------------|--------|------------------------------|--------|
|                                              |   | 2009                         |   |   | 2008 |   |
|                                              |   |                         |   |   |   |   |
| Average      net investment in impaired loans     |   | $                            | 2,170  |   |   |   | 45 |   |
|                                              |   |                         |   |   |   |   |   |   |
| Interest      income recognized on impaired loans |   | $                            | 26     |   |   |   | - |   |
|                                              |   |                         |   |   |   |   |   |   |
| Interest      income received on impaired loans   |   | $                            | 26     |   |   |   | - |   |

----

|   |   Impaired      collateral-dependent loans are carried at the lower of cost or fair      value.  At December 31, 2009, those impaired      collateral-dependent loans which are measured at fair value on a      nonrecurring basis are as follows (in  thousands): |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   |  FairValue(1) |   |   |   Level 1 |   |   |   Level 2 |   |   |   Level 3 |   |   |  TotalLosses |   |   | LossesRecorded      inOperations      in 2009 |   |
|--------|--------|--------------------|--------|--------|---------------------|--------|--------|---------------------|--------|--------|---------------------|--------|--------|-------------------|--------|--------|-----------------------------------------------|--------|
|   |   |               |   |   |                |   |   |                |   |   |                |   |   |              |   |   |                                          |   |
|        |   | $                  | 1,985  |   |                |   | -      |                |   |   | -                   |   |   |              | 1,985  |   |                                          |   | 558 |   |   |   | 558 |   |

----

|   | (1) | In      addition, loans with a carrying value of $1,524,000 were measured for      impairment using Level 3 inputs and had a fair value in excess of carrying      value. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Nonaccrual      and accruing past due loans were as follows (in  thousands): |
|--------|------------------------------------------------------------------------------|

|                                             |   | At      December 31, |   |
|--------------------------------------------------|--------|----------------------|--------|
|                                             |   | 2009                 |   |   | 2008 |   |
|                                             |   |                 |   |   |   |   |
| Nonaccrual      loans                            |   | $                    | 1,328  |   |   |   | - |   |
| Accruing      loans past due ninety days or more |   |                 | -      |   |   |   | - |   |
|                                             |   |                 |   |   |   |   |   |   |
| Total                                            |   | $                    | 1,328  |   |   |   | - |   |

|   | Foreclosed      real estate measured at fair value on a nonrecurring basis is as follows      (in thousands): |
|--------|---------------------------------------------------------------------------------------------------------------|

|                        |   | At      December 31, 2009 |   |   | LossesRecorded      in |   |
|-----------------------------|--------|---------------------------|--------|--------|------------------------|--------|
|                        |   | FairValue                 |   |   | Level      1           |   |   | Level      2 |   |   | Level      3 |   |   | TotalLosses |   |   | Operationsin      2009 |   |
|                        |   |                      |   |   |                   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Foreclosed      real estate |   | $                         | 315    |   |                   |   | - |   |   |   | - |   |   |   | 315 |   |   |   | - |   |   |   | - |   |

----

|                                                |   | At      December 31, |   |
|-----------------------------------------------------|--------|----------------------|--------|
|                                                |   | 2009                 |   |   | 2008 |   |
|                                                |   |                 |   |   |   |   |
| Furniture,      fixtures and equipment              |   | $                    | 1,241  |   |   |   | 1,008 |   |
| Leasehold      improvements                         |   |                 | 1,100  |   |   |   | 717 |   |
|                                                |   |                 |   |   |   |   |   |   |
| Total,      at cost                                 |   |                 | 2,341  |   |   |   | 1,725 |   |
|                                                |   |                 |   |   |   |   |   |   |
| Less      accumulated depreciation and amortization |   |                 | (745   | ) |   |   | (365 | ) |
|                                                |   |                 |   |   |   |   |   |   |
| Premises      and equipment, net                    |   | $                    | 1,596  |   |   |   | 1,360 |   |

|   | The      Company has an operating lease for its main office.  This lease      has an initial lease term of five years and commenced on January 1,      2007.  This lease contains a renewal option of an additional      five year term with a 3% annual escalation provision.  This      lease also has a purchase option under which the property can be purchased      for $2.9 million during the 25th      through the 36th      month of the lease; $3.2 million during the 37th      through the 48th      month; and $3.5 million during the 49th      through 60th      month of the lease.  If the Company does not exercise the option      to purchase within the lease months 25 to 60, the purchase option      expires.  The Company owns a 20.3% equity investment in Moon      Building, LLC which owns the building.  The Company's investment      at December 31, 2009 and 2008 was $271,000 and $297,000, respectively,      which is included in other assets on the consolidated balance      sheets.  This investment is accounted for under the equity      method of accounting. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      Company also has an operating lease for another banking      facility.  This lease has an initial lease term of ten years and      commenced on February 1, 2007.  This lease contains a renewal      option for two additional five year periods with an annual 3% escalation      provision. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (continued) |
|--------|-------------|

----

|   | In      addition, the Company leases another banking facility from a director of      the Company.  This lease has an initial lease term of five years      and commenced in April, 2009.  This lease contains a renewal      option for two additional five years periods with a $1 per square foot per      year increase.  This lease also has a purchase option under      which the property can be purchased for $1.2 million during the 1st      through 13th      month of the lease; $1.3 million during the 14th      through the 24th      month; 1.4 million during the 25th      through the 36th      month of the lease; $1.5 million during the 37th      through the 48th      month of the lease and $1.6 million during the 49th      through the 60th      month of the lease.  If the Company does not exercise the option      to purchase within lease months 1 to 60, the purchase option      expires. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Lease      expense under these operating leases was $229,000 and $148,000 for the      years ended December 31, 2009 and 2008, respectively.  Future      minimum lease payments at December 31, 2009 are as follows (in      thousands): |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Year      EndingDecember      31, |   | Amount |   |
|-----------------------------------|--------|--------|--------|
|                              |   |   |   |
| 2010                              |   | $      | 229    |   |
| 2011                              |   |   | 236    |   |
| 2012                              |   |   | 243    |   |
| 2013                              |   |   | 251    |   |
| 2014                              |   |   | 258    |   |
| Thereafter                        |   |   | 771    |   |
|                              |   |   |   |   |
| Total      minimum lease payments |   | $      | 1,988  |   |

|   | The      aggregate amount of time deposits with a minimum denomination of $100,000,      was approximately $31.7 million and $12.5 million at December 31, 2009 and      2008, respectively. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | A      schedule of maturities of time deposits at December 31, 2009 follows (in      thousands): |
|--------|--------------------------------------------------------------------------------------------------|

| Year      EndingDecember      31, |   | Amount |   |
|-----------------------------------|--------|--------|--------|
|                              |   |   |   |
| 2010                              |   | $      | 36,682 |   |
| 2011                              |   |   | 2,507  |   |
| 2013                              |   |   | 12     |   |
| 2014                              |   |   | 11     |   |
|                              |   |   |   |   |
|                              |   | $      | 39,212 |   |

----

|   | The      maturity and interest rate on the advances from the Federal Home Loan Bank      of Atlanta ("FHLB") are as follows ($ in  thousands): |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------|

| Maturingin      theYear      Ending |   | Fixed      or  |   | Variable      Interest |   |   | At      December 31, |   |
|-------------------------------------|--------|----------------|--------|------------------------|--------|--------|----------------------|--------|
| December      31,                   |   | Rate           |   | Rate                   |   |   | 2009                 |   |   | 2008 |   |
|                                |   |           |   |                   |   |   |                 |   |   |   |   |
| 2009                                |   | Fixed          |   |                   | 3.97   | %      |                 | $      | - |   |   |   | 1,000 |   |
| 2009                                |   | Fixed          |   |                   | 2.26   | %      |                 |   | - |   |   |   | 1,000 |   |
| 2011                                |   | Fixed          |   |                   | 1.15   | %      |                 |   | 1,000 |   |   |   | - |   |
| 2011                                |   | Fixed          |   |                   | 1.27   | %      |                 |   | 2,000 |   |   |   | - |   |
| 2018                                |   | Fixed      (a) |   |                   | 3.05   | %      |                 |   | 1,000 |   |   |   | 1,000 |   |
| 2018                                |   | Fixed      (a) |   |                   | 3.45   | %      |                 |   | 1,000 |   |   |   | 1,000 |   |
| 2018                                |   | Fixed      (a) |   |                   | 3.20   | %      |                 |   | 1,000 |   |   |   | 1,000 |   |
|                                |   |           |   |                   |   |   |                 |   |   |   |   |   |   |   |
|                                |   |           |   |                   |   |   |                 | $      | 6,000 |   |   |   | 5,000 |   |

----

|   | (a) | Callable      by the issuer in 2011. |
|--------|-----|--------------------------------------|

|   | At      December 31, 2009, the Company pledged securities as collateral with a      carrying value of approximately $6.7 million for FHLB      advances. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      Company enters into repurchase agreements with customers that sweep funds      from deposit accounts into investment accounts.  These      investment accounts are not federally insured and are treated as      borrowings.  These agreements require the Company to pledge      securities as collateral for these borrowings.  At December 31,      2009 and 2008, the outstanding balance of such borrowings totaled      approximately $342,000 and $1.1 million, respectively, and the Company      pledged securities with a carrying value of approximately $1.0 million and      $3.0 million, respectively, as collateral for these      agreements. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Allocation      of the Federal and state income tax benefit is as follows (in      thousands): |
|--------|------------------------------------------------------------------------------------------------|

|                    |   | Year      Ended December 31, |   |
|-------------------------|--------|------------------------------|--------|
|                    |   | 2009                         |   |   | 2008 |   |
| Deferred:               |   |                         |   |   |   |   |
| Federal                 |   | $                            | (859   | ) |   |   | (717 | ) |
| State                   |   |                         | (146   | ) |   |   | (103 | ) |
|                    |   |                         |   |   |   |   |   |   |
| Income      tax benefit |   | $                            | (1,005 | ) |   |   | (820 | ) |

|   | (continued) |
|--------|-------------|

----

|   | The      reasons for the differences between the statutory Federal income tax rate      and the effective tax rate are summarized as follows ($ in      thousands): |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                         |   | Year      Ended December 31, |   |
|----------------------------------------------|--------|------------------------------|--------|
|                                         |   | 2009                         |   |   | 2008 |   |
|                                         |   | Amount                       |   |   | %      ofPretaxLoss |   |   | Amount |   |   | %      ofPretaxLoss |   |
|                                         |   |                         |   |   |   |   |   |   |   |   |   |   |
| Income      tax benefit at statutory rate    |   | $                            | (909   | ) |   |   | (34.0 | )% |   | $ | (752 | ) |   |   | (34.0 | )% |
| Increase      resulting from-                |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| State      taxes, net of Federal tax benefit |   |                         | (96    | ) |   |   | (3.6 | ) |   |   | (68 | ) |   |   | (3.1 | ) |
|                                         |   |                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income      tax benefit                      |   | $                            | (1,005 | ) |   |   | (37.6 | )% |   | $ | (820 | ) |   |   | (37.1 | )% |

|   | The      tax effects of temporary differences that give rise to significant      portions of the deferred tax assets and deferred tax liabilities are      presented below (in thousands). |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                    |   |   |   |   | At      December 31, |   |
|---------------------------------------------------------|--------|--------|--------|--------|----------------------|--------|
|                                                    |   |   |   |   | 2009                 |   |   | 2008 |   |
| Deferred      tax assets:                               |   |   |   |   |                 |   |   |   |   |
| Allowance      for loan losses                          |   | $      | 612    |   |                 |   | 317 |   |   |   |   |
| Net      operating loss carryforwards                   |   |   |   |   |                 |   | 1,380 |   |   |   | 661 |   |
| Organizational      and start-up costs                  |   |   |   |   |                 |   | 316 |   |   |   | 347 |   |
| Stock-based      compensation                           |   |   |   |   |                 |   | 58 |   |   |   | 29 |   |
| Unrealized      losses on securities available for sale |   |   |   |   |                 |   | 11 |   |   |   | - |   |
|                                                    |   |   |   |   |                 |   |   |   |   |   |   |   |
| Deferred      tax assets                                |   |   |   |   |                 |   | 2,377 |   |   |   | 1,354 |   |
|                                                    |   |   |   |   |                 |   |   |   |   |   |   |   |
| Deferred      tax liabilities:                          |   |   |   |   |                 |   |   |   |   |   |   |   |
| Premises      and equipment                             |   |   | (7     | )      |                 |   | - |   |   |   |   |   |
| Unrealized      gains on securities available for sale  |   |   |   |   |                 |   | - |   |   |   | (107 | ) |
|                                                    |   |   |   |   |                 |   |   |   |   |   |   |   |
| Deferred      tax liabilities                           |   |   |   |   |                 |   | (7 | ) |   |   | (107 | ) |
|                                                    |   |   |   |   |                 |   |   |   |   |   |   |   |
| Net      deferred tax asset                             |   |   |   |   |                 | $      | 2,370 |   |   |   | 1,247 |   |

|   | At      December 31, 2009, the Company has approximately $3.6 million of net      operating loss carryforwards available to offset future taxable      income.  These carryforwards will begin to expire in      2027. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      Company files income tax returns in the U.S. Federal jurisdiction and the      State of Florida.  All returns filed by the Company since      inception in 2006 are still subject to examination by the respective      taxing authorities. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | The      Company is a party to financial instruments with off-balance-sheet risk in      the normal course of business to meet the financing needs of its      customers.  These financial instruments are undisbursed loans in      process, unfunded lines of credit and standby letters of credit and may      involve, to varying degrees, elements of credit and interest-rate risk in      excess of the amount recognized in the consolidated balance sheet. The      contract amounts of these instruments reflect the extent of involvement      the Company has in these financialinstruments. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The      Company's exposure to credit loss in the event of nonperformance by the      other party to the financial instrument for undisbursed loans in process,      unfunded lines of credit and standby letters of credit is represented by      the contractual amount of those instruments.  The Company uses      the same credit policies in making commitments as it does for      on-balance-sheet instruments. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Undisbursed      loans in process and unfunded lines of credit are agreements to lend to a      customer as long as there is no violation of any condition established in      the contract.  Commitments generally have fixed expiration dates      or other termination clauses and may require payment of a      fee.  Because some of the commitments are expected to expire      without being drawn upon, the total commitment amounts do not necessarily      represent future cash requirements.  The Company evaluates each      customer's credit worthiness on a case-by-case basis.  The      amount of collateral obtained, if deemed necessary by the Company, upon      extension of credit, is based on management's credit evaluation of the      counterparty. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Standby      letters-of-credit are conditional lending commitments issued by the      Company to guarantee the performance of a customer to a third party and to      support private borrowings arrangements. All letters of credit issued have      expiration dates within one year.  The credit risk involved in      issuing letters-of-credit is essentially the same as that involved in      extending loans to customers. The Company may hold collateral supporting      those commitments. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | A      summary of the Company's financial instruments with off-balance-sheet risk      at December 31, 2009 follows (inthousands): |
|--------|------------------------------------------------------------------------------------------------------------------------------------|

| Undisbursed      loans in process |   | $      | 5,671  |   |
|-----------------------------------|--------|--------|--------|--------|
|                              |   |   |   |   |
| Unfunded      lines of credit     |   | $      | 9,486  |   |
|                              |   |   |   |   |
| Standby      letters of credit    |   | $      | 100    |   |

----

|   | In      the ordinary course of business, the Company has granted loans to and      accepts deposits from principal officers and directors and their      affiliates.  These are summarized as follows (in      thousands): |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                         |   | Year      Ended December 31, |   |
|------------------------------|--------|------------------------------|--------|
|                         |   | 2009                         |   |   | 2008 |   |
| Loans:                       |   |                         |   |   |   |   |
| Beginning      balance       |   | $                            | 2,743  |   |   |   | 1,260 |   |
| Additions                    |   |                         | 1,241  |   |   |   | 1,970 |   |
| Repayments                   |   |                         | (2,052 | ) |   |   | (487 | ) |
|                         |   |                         |   |   |   |   |   |   |
| Ending      balance          |   | $                            | 1,932  |   |   |   | 2,743 |   |
|                         |   |                         |   |   |   |   |   |   |
| Deposits      at end of year |   | $                            | 15,671 |   |   |   | 10,511 |   |

|   | In      addition, the Company leases a banking facility from a director of the      Company (see Note 5). |
|--------|-----------------------------------------------------------------------------------------------------------|

|   | The      Holding Company is limited in the amount of cash dividends it may declare      and pay by the amount of dividends it can receive from the      Bank.  The Bank is limited in the amount of cash dividends that      may be paid. The amount of cash dividends that may be paid is based on the      Bank's net earnings of the current year combined with the Bank's retained      earnings of the preceding two years, as defined by state banking      regulations. However, for any dividend declaration, the Bank must consider      additional factors such as the amount of current period net earnings,      liquidity, asset quality, capital adequacy and economic      conditions.  It is likely that these factors would further limit      the amount of dividends which the Bank could declare.  In      addition, bank regulators have the authority to prohibit banks from paying      dividends if they deem such payment to be an unsafe or unsound      practice. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (continued) |
|--------|-------------|

----

|   | In      2008, the Bank established a Non-Employee Directors' Stock Option Plan for      the benefit of the directors.  A total of 125,000 options can be      granted under the plan.  Stock options are granted at an      exercise price equal to the greater of $10 or the fair market value of the      common stock on the grant date.   All options expire ten      years from the date of grant. The majority of options granted vest over a      three year period.  At December 31, 2009, 22,000 shares remain      available for grant. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | In      2008, the Bank also established an Employee Stock Option Plan for the      benefit of officers and key employees.  A total of 75,000      options have been reserved for this plan.  Stock options are      granted at an exercise price equal to the greater of $10 or the fair      market value of the common stock on the grant date.   All      options expire ten years from the date of grant and vest over a four to      five year term.  At December 31, 2009, 35,000 shares remain      available for grant. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | A      summary of the activity in the Company's stock option plan is as      follows: |
|--------|---------------------------------------------------------------------------------------|

|                                  |   | Number      ofOptions |    |   | Weighted-AverageExercisePrice |   | Weighted-AverageRemainingContractualTerm |   | AggregateIntrinsicValue |   |
|---------------------------------------|--------|-----------------------|---------|--------|-------------------------------|--------|------------------------------------------|--------|-------------------------|--------|
| Outstanding      at December 31, 2007 |   |                  | -       |   |                          | $      | -                                        |   |                    |   |   |   |
| Granted                               |   |                  | 143,000 |   |                          |   | 10.00                                    |   |                    |   |   |   |
| Forfeited                             |   |                  | (8,000  | )      |                          |   | 10.00                                    |   |                    |   |   |   |
|                                  |   |                  |    |   |                          |   |                                     |   |                    |   |   |   |
| Outstanding      at December 31, 2008 |   |                  | 135,000 |   |                          |   | 10.00                                    |   |                    |   |   |   |
| Granted                               |   |                  | 8,000   |   |                          |   | 10.00                                    |   |                    |   |   |   |
|                                  |   |                  |    |   |                          |   |                                     |   |                    |   |   |   |
| Outstanding      at December 31, 2009 |   |                  | 143,000 |   |                          | $      | 10.00                                    |   | 8.81      years         |   |   | - |   |
|                                  |   |                  |    |   |                          |   |                                     |   |                    |   |   |   |   |
| Exercisable      at December 31, 2009 |   |                  | 79,327  |   |                          | $      | 10.00                                    |   | 8.79      years         |   |   | - |   |

|   |  (continued) |
|--------|-------------------|

----

|   | The      fair value of each option granted is estimated on the date of the grant      using the Black-Scholes option-pricing model with the following      assumptions: |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                                        |   | Year      Ended December      31, |   |
|-----------------------------------------------------------------------------|--------|-----------------------------------|--------|
|                                                                        |   | 2009                              |   |   | 2008 |   |
| Risk-free      interest rate                                                |   |                              | 2.60   | % |   |   | 4.19-4.38 | % |
| Dividend      yield                                                         |   |                              | -      | % |   |   | - | % |
| Expected      stock volatility                                              |   |                              | 9.30   | % |   |   | 8.30 | % |
| Expected      life in years                                                 |   |                              | 6      |   |   |   | 5.5-6.0 |   |
| Per      share grant-date fair value of options issued during the      year |   | $                                 | 1.74   |   |   |   | 2.13-2.36 |   |

|   | The      Company examined its historical pattern of option exercises in an effort      to determine if there were any pattern based on certain employee      populations. From this analysis, the Company could not identify any      patterns in the exercise of options. As such, the Company used the      guidance issued by the SEC to determine the estimated life of options.      Expected volatility is based on historical volatility of similar size      financial institutions. The risk-free rate for periods within the      contractual life of the option is based on the U.S. Treasury yield curve      in effect at the time of grant. The dividend yield assumption is based on      the Company's history and expectation of dividend  payments. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | At      December 31, 2009 there was approximately $111,000 of total unrecognized      compensation expense related to the nonvested share-based compensation      arrangements granted under the plans. The cost is expected to be      recognized over a weighted-average period of 1.7 years.  The      total fair value of shares vesting and recognized as compensation expense      was approximately $97,000 and $102,000 for the years ended December 31,      2009 and 2008, respectively.  The associated income tax benefit      recognized was $29,000 for each of the years ended December 31, 2009 and      2008. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | In      connection with the initial common stock offering, the Company issued one      warrant to purchase one share of the Company's common stock at $10.00 per      share.  The Company issued 1,334,840 warrants in this stock      offering.  The warrants expire in October, 2010 and are callable      by the Company any time after April, 2008.  In October 2009, the      Company called 402,252 warrants of which 44,726 were exercised as of      December 31, 2009.  In January 2010, an additional 16,550      warrants were exercised and 340,976 warrants expired.  The      Company expects to call the remaining 932,588 warrants in April, 2010 with      an expiration date in May, 2010. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (continued) |
|--------|-------------|

----

|   | The      Bank is subject to various regulatory capital requirements administered by      the Federal and state banking agencies.  Failure to meet minimum      capital requirements can initiate certain mandatory-and possibly      additional discretionary actions by regulators that, if undertaken, could      have a direct material effect on the Company's and the Bank's financial      statements.  Under capital adequacy guidelines and the      regulatory framework for prompt corrective action, the Bank must meet      specific capital guidelines that involve quantitive measures of their      assets, liabilities, and certain off-balance-sheet items as calculated      under regulatory accounting practices.  The capital amounts and      classifications are also subject to qualitative judgments by the      regulators about components, risk weightings, and other      factors. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Quantitative      measures established by regulation to ensure capital adequacy require the      Bank to maintain minimum amounts and percentages (set forth in the table      below) of total and Tier I capital (as defined in the regulations) to      risk-weighted assets (as defined), and of Tier I capital (as defined) to      average assets (as defined). |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | As      of December 31, 2009, the most recent notification from the regulatory      authorities categorized the Bank as well capitalized under the regulatory      framework for prompt corrective action.  To be categorized as      well capitalized the Bank must maintain minimum total risk-based, Tier I      risk-based, and Tier I leverage percentages as set forth in the      table.  There are no conditions or events since that      notification that management believes have changed the Bank's category.      The Bank's actual capital amounts and percentages as of December 31, 2009      and 2008 are also presented in the table ($ in  thousands). |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                          |   | Actual |   |   | For      Capital AdequacyPurposes |   |   | To      Be WellCapitalized      UnderPrompt      CorrectiveAction      Provisions |   |
|-------------------------------|--------|--------|--------|--------|-----------------------------------|--------|--------|-----------------------------------------------------------------------------------|--------|
|                          |   | Amount |   |   | %                                 |   |   | Amount                                                                            |   |   | % |   |   | Amount |   |   | % |   |
| As      of December 31, 2009: |   |   |   |   |                              |   |   |                                                                              |   |   |   |   |   |   |   |   |   |   |
| Total      capital to Risk-   |   |   |   |   |                              |   |   |                                                                              |   |   |   |   |   |   |   |   |   |   |
| Weighted      assets          |   | $      | 9,986  |   |                              |   | 17.55  | %                                                                                 |   | $ | 4,552 |   |   |   | 8.00 | % |   | $ | 5,690 |   |   |   | 10.00 | % |
| Tier      I Capital to Risk-  |   |   |   |   |                              |   |   |                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted      Assets          |   |   | 8,344  |   |                              |   | 14.66  |                                                                              |   |   | 2,277 |   |   |   | 4.00 |   |   |   | 3,416 |   |   |   | 6.00 |   |
| Tier      I Capital           |   |   |   |   |                              |   |   |                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| to      Total Assets          |   |   | 8,344  |   |                              |   | 10.42  |                                                                              |   |   | 3,203 |   |   |   | 4.00 |   |   |   | 4,004 |   |   |   | 5.00 |   |
|                          |   |   |   |   |                              |   |   |                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| As      of December 31, 2008: |   |   |   |   |                              |   |   |                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total      capital to Risk-   |   |   |   |   |                              |   |   |                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted      assets          |   |   | 10,495 |   |                              |   | 32.95  |                                                                              |   |   | 2,548 |   |   |   | 8.00 |   |   |   | 3,185 |   |   |   | 10.00 |   |
| Tier      I Capital to Risk-  |   |   |   |   |                              |   |   |                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted      Assets          |   |   | 10,125 |   |                              |   | 31.79  |                                                                              |   |   | 1,274 |   |   |   | 4.00 |   |   |   | 1,911 |   |   |   | 6.00 |   |
| Tier      I Capital           |   |   |   |   |                              |   |   |                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| to      Total Assets          |   |   | 10,125 |   |                              |   | 22.26  |                                                                              |   |   | 1,773 |   |   |   | 4.00 |   |   |   | 2,388 |   |   |   | 5.00 |   |

|   | (continued) |
|--------|-------------|

----

|   | The      estimated fair values of the Company's financial instruments are as      follows (in thousands): |
|--------|-----------------------------------------------------------------------------------------------------------|

|                                         |   | At      December 31, |   |
|----------------------------------------------|--------|----------------------|--------|
|                                         |   | 2009                 |   |   | 2008 |   |
|                                         |   | Carrying Amount |   |   | FairValue |   |   | CarryingAmount |   |   | FairValue |   |
| Financial      assets:                       |   |                 |   |   |   |   |   |   |   |   |   |   |
| Cash      and cash equivalents               |   | $                    | 9,836  |   |   |   | 9,836 |   |   |   | 4,435 |   |   |   | 4,435 |   |
| Securities      available for sale           |   |                 | 16,410 |   |   |   | 16,410 |   |   |   | 12,378 |   |   |   | 12,378 |   |
| Loans,      net                              |   |                 | 47,487 |   |   |   | 46,167 |   |   |   | 27,593 |   |   |   | 27,221 |   |
| Accrued      interest receivable             |   |                 | 277    |   |   |   | 277 |   |   |   | 152 |   |   |   | 152 |   |
| Federal      Home Loan Bank stock            |   |                 | 354    |   |   |   | 354 |   |   |   | 263 |   |   |   | 263 |   |
|                                         |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Financial      liabilities:                  |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Deposits                                     |   |                 | 63,001 |   |   |   | 62,994 |   |   |   | 30,457 |   |   |   | 30,025 |   |
| Other      borrowings                        |   |                 | 342    |   |   |   | 342 |   |   |   | 1,055 |   |   |   | 1,055 |   |
| Federal      Home Loan Bank advances         |   |                 | 6,000  |   |   |   | 5,890 |   |   |   | 5,000 |   |   |   | 4,976 |   |
| Accrued      interest payable                |   |                 | 85     |   |   |   | 85 |   |   |   | 63 |   |   |   | 63 |   |
|                                         |   |                 |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Off-balance-sheet      financial instruments |   |                 | -      |   |   |   | - |   |   |   | - |   |   |   | - |   |

|   | The      Company offers a 401(k) Profit Sharing Plan which is available to      employees who have completed one year of service and have attained age      eighteen.  The Company did not contribute to the plan in 2009 or      2008. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (continued) |
|--------|-------------|

----

|                                                         |   | At      December 31, |   |
|--------------------------------------------------------------|--------|----------------------|--------|
|                                                         |   | 2009                 |   |   | 2008 |   |
| Assets                                                       |   |                 |   |   |   |   |
|                                                         |   |                 |   |   |   |   |
| Cash                                                         |   | $                    | 652    |   |   |   | 170 |   |
| Loans,      net of allowance for loan losses of $475 in 2008 |   |                 | 472    |   |   |   | 490 |   |
| Other      assets                                            |   |                 | 509    |   |   |   | 505 |   |
| Investment      in subsidiary                                |   |                 | 8,335  |   |   |   | 10,125 |   |
|                                                         |   |                 |   |   |   |   |   |   |
| Total      assets                                            |   | $                    | 9,968  |   |   |   | 11,290 |   |
|                                                         |   |                 |   |   |   |   |   |   |
| Liabilities      and Stockholders' Equity                    |   |                 |   |   |   |   |   |   |
|                                                         |   |                 |   |   |   |   |   |   |
| Other      liabilities                                       |   |                 | 21     |   |   |   | 15 |   |
| Stockholders'      equity                                    |   |                 | 9,947  |   |   |   | 11,275 |   |
|                                                         |   |                 |   |   |   |   |   |   |
| Total      liabilities and stockholders' equity              |   | $                    | 9,968  |   |   |   | 11,290 |   |

|                                                       |   | Year      Ended December      31, |   |
|------------------------------------------------------------|--------|-----------------------------------|--------|
|                                                       |   | 2009                              |   |   | 2008 |   |
| Revenues                                                   |   | $                                 | 33     |   |   |   | 92 |   |
| Expenses                                                   |   |                              | 134    |   |   |   | 619 |   |
|                                                       |   |                              |   |   |   |   |   |   |
| Loss      before income tax benefit and loss of subsidiary |   |                              | (101   | ) |   |   | (527 | ) |
|                                                       |   |                              |   |   |   |   |   |   |
| Income      tax benefit                                    |   |                              | 29     |   |   |   | 196 |   |
|                                                       |   |                              |   |   |   |   |   |   |
| Net      loss before loss of subsidiary                    |   |                              | (72    | ) |   |   | (331 | ) |
|                                                       |   |                              |   |   |   |   |   |   |
| Net      loss of subsidiary                                |   |                              | (1,597 | ) |   |   | (1,062 | ) |
|                                                       |   |                              |   |   |   |   |   |   |
| Net      loss                                              |   | $                                 | (1,669 | ) |   |   | (1,393 | ) |

|   | (continued) |
|--------|-------------|

----

|                                                                                                                                                            |   | Year      Ended December 31, |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------------|--------|
|                                                                                                                                                            |   | 2009                         |   |   | 2008 |   |
| Cash      flows from operating activities:                                                                                                                      |   |                         |   |   |   |   |
| Net      loss                                                                                                                                                   |   | $                            | (1,669 | ) |   |   | (1,393 | ) |
| Adjustments      to reconcile net loss to net cash provided by operating      activities:                                                                       |   |                         |   |   |   |   |   |   |
| Provision      for loan losses                                                                                                                                  |   |                         | -      |   |   |   | 475 |   |
| Increase      in other assets                                                                                                                                   |   |                         | (4     | ) |   |   | (167 | ) |
| Stock-based      compensation                                                                                                                                   |   |                         | 97     |   |   |   | 102 |   |
| Increase      in other liabilities                                                                                                                              |   |                         | 6      |   |   |   | 15 |   |
| Equity      in undistributed loss of subsidiary                                                                                                                 |   |                         | 1,597  |   |   |   | 1,062 |   |
|                                                                                                                                                            |   |                         |   |   |   |   |   |   |
| Net      cash provided by operating activities                                                                                                                  |   |                         | 27     |   |   |   | 94 |   |
|                                                                                                                                                            |   |                         |   |   |   |   |   |   |
| Cash      flows from investing activities:                                                                                                                      |   |                         |   |   |   |   |   |   |
| Net      principal repayments (disbursements) of loans                                                                                                          |   |                         | 18     |   |   |   | (467 | ) |
| Investment      in subsidiary                                                                                                                                   |   |                         | -      |   |   |   | (2,000 | ) |
|                                                                                                                                                            |   |                         |   |   |   |   |   |   |
| Net      cash provided by (used in) investing activities                                                                                                        |   |                         | 18     |   |   |   | (2,467 | ) |
|                                                                                                                                                            |   |                         |   |   |   |   |   |   |
| Cash      flows from financing activity-                                                                                                                        |   |                         |   |   |   |   |   |   |
| Proceeds      from exercise of common stock warrants                                                                                                            |   |                         | 437    |   |   |   | - |   |
|                                                                                                                                                            |   |                         |   |   |   |   |   |   |
| Net      increase (decrease) in cash                                                                                                                            |   |                         | 482    |   |   |   | (2,373 | ) |
|                                                                                                                                                            |   |                         |   |   |   |   |   |   |
| Cash      at beginning of the year                                                                                                                              |   |                         | 170    |   |   |   | 2,543 |   |
|                                                                                                                                                            |   |                         |   |   |   |   |   |   |
| Cash      at end of year                                                                                                                                        |   | $                            | 652    |   |   |   | 170 |   |
|                                                                                                                                                            |   |                         |   |   |   |   |   |   |
| Supplemental      disclosure of cash flow information-                                                                                                          |   |                         |   |   |   |   |   |   |
| Noncash      investing activity-                                                                                                                                |   |                         |   |   |   |   |   |   |
| Net      change in accumulated other comprehensive (loss) income of subsidiary, net      change in unrealized gain (loss) on securities available for      sale |   | $                            | (193   | ) |   |   | 167 |   |

----