Document:

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                                                                    EXHIBIT 10.1

                         W.F. CHESLEY REAL ESTATE, INC.
                        2200 DEFENSE HIGHWAY, SUITE 101
                             CROFTON, MARYLAND 21114
                              Phone (301) 261-6700

      On 7 day of July, 2004;
THIS LEASE is entered into by and between Ridgely I, LLC (hereinafter
"Landlord") and Old Line Bank (hereinafter "Tenant"), for the term, at the
rental and subject to and upon all of the terms, covenants and agreements
hereinafter set forth.

1.    PREMISES

      1.1 PREMISES. Landlord hereby leases to Tenant and Tenant hereby rents
from Landlord those certain Premises located at 1641 Rt 3 North, situated in
the City of Crofton, County of Anne Arundel, State of Maryland as shown on
Exhibit A hereto. The Premises are approximately 37.5 feet in frontage by 68
feet in depth, containing approximately 2420 square feet of floor area.

      Landlord hereby lets and demises unto Tenant, and Tenant hereby rents,
hires and takes of and from Landlord, for the term, upon the provisions,
covenants and conditions herein set forth, that certain building or portion of a
building (herein referred to as the "Premises"), located within the area
delineated in red on Exhibit "A" hereof, entitled "Description of Premises". The
Premises are situated on a portion of that certain real property (herein
referred to as the "Office and Retail Center") situated in the County of Anne
Arundel, State of Maryland, and are located within the Office and Retail Center
as depicted on Exhibit "C" hereof, entitled "Plot Plan". Copies of the aforesaid
Exhibit "A" and "C" are attached hereto, incorporated herein, and by this
reference made a part of this Lease. Landlord makes no representations or
warranties of any kind or nature as to the size, location, or time of
construction of any structures (other than the Premises) shown on Exhibit "A".
Landlord hereby reserves the right at any time and from time to time to make
alterations or additions to the Premises, to build additional stories on the
building in which the Premises are contained, and to build adjoining the same,
and to install, maintain, use, repair and replace, pipes, ducts, conduits and
wires, leading through, under or over the premises, in locations serving other
parts of the Office and Retail Center, which will not commercially interfere
with Tenant's use of the Premises. Landlord also reserves the right to enlarge
the area of the Office and Retail Center by acquisition or leasehold, to
construct other buildings or improvements in the Office and Retail Center,
from time to time, to make alterations thereof or additions thereto, to build
additional stories on any such building or buildings, to build adjoining same,
and to construct doubledeck, subterranean or elevated parking facilities.

      It is understood and agreed that the depiction of the Office and Retail
Center in Exhibit "C" hereof, and the location of the Premises in the Office and
Retail Center as shown on Exhibit "A" hereof, shall be subject to such changes
as may be certified by Landlord's architect as necessary for engineering or
architectural purposes for the construction of other improvements to be
constructed hereon. Any such changes so certified shall not invalidate this
Lease, and the description and location of the Premises as set forth in Exhibits
"C" and "A" hereof, respectively, shall be deemed to have been expressly
modified and amended herein in accordance with such changes.

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      1.2 IMPROVEMENTS. The obligations of Tenant to perform the work and supply
material and labor to prepare the Premises for occupancy are set forth in detail
in Exhibit B hereto. Tenant shall expend all funds and do all acts required of
them in Exhibit B and shall have the work performed promptly and diligently in a
first-class workmanlike manner. Any work to be performed by Landlord, if any,
shall be shown on Exhibit B.

      The Landlord shall complete certain interior improvements which shall
include the HVAC system with trunk duct line. The Landlord shall further provide
a 200 amp electrical panel, fire rated party walls with a prime coat of paint,
finished concrete floors and fire rated barrier at ceiling. All fire rating
shall be in accordance with Anne Arundel County Code. Landlord shall further
install a one-half bath, one front entrance door and one rear exit door. The
cost of all other interior improvements, including labor and material, shall be
borne by the Tenant and installed at the Tenant's direction in a first-class
workmanlike manner. These improvements shall include, but are not limited to,
floor covering, drop ceiling, interior partitioning, wall covering, additional
plumbing, electrical or HVAC duct system or equipment. See Page 2B

2.    TERM * See Below

      The lease term shall be ten (10) full calendar years, plus the partial
year in which the rental commences. The parties hereto acknowledge that certain
obligations under various provisions hereof may commence prior to the lease term
(for example, construction, indemnity, liability insurance, and others), and
the parties agree to be bound by such provisions prior to the commencement of
the lease term.

3.    BASE RENT

      Tenant agrees to pay to Landlord as Base Rent, without notice or demand,
the monthly sum of Six Thousand Three Hundred Fifty-Two & 50/100 ($ 6,352.50)
in advance on or before the first day of each and every month during the term
hereof, except: that the first month's rent shall be paid upon the execution of
this Lease. The rental shall commence (check applicable box):

___ On       , if the Premises are being leased in their "as is" condition or
subject to such incidental work as is to be performed by Landlord prior to said
date (this work, if any, to be set forth in the attached Exhibit B and in this
latter event, the rental shall commence on said date only if Landlord shall have
completed said work).

x 120 days after completion of Landlord's work as set forth in the attached
Exhibit B or when the Tenant opens for business whichever is sooner. Landlord
agrees that it will, at its sole cost and expense and as soon as is reasonably
possible, commence and pursue to completion the improvements to be erected by
Landlord as shown on the attached Exhibit B. The term "substantial completion of
the Premises" shall mean the date on which Landlord notifies Tenant in writing
that the Premises are substantially complete to the extent of Landlord's work
specified in Exhibit B, with the exception of the work that Landlord cannot
complete until Tenant performs necessary portions of its work or notifies
Landlord of the selection of certain of its choices, if applicable. Tenant shall
commence the installation of its fixtures and equipment; and any of Tenant's
Work as set forth in Exhibit B, promptly upon substantial completion of
Landlord's Work in the Premises and shall diligently prosecute such installation
to completion and shall open the Premises for business not later than the
expiration of said ten day period. See Page 2A

*     This Lease will automatically renew for three (3) additional terms
      of five (5) years unless the bank gives notice of its intention to allow
      the Lease to expire no less than 180 days prior to the end of the initial
      term or any renewed term. All terms and conditions of the original lease
      to continue in full forge and effect during any renewal term.

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Landlord and Tenant acknowledge that the premises that are the subject of this
Lease Agreement are subject to construction and expect a commencement date of
approximately February 1, 2005. All Parties acknowledge that the commencement
date is subject to the construction schedule of the addition to an existing
shopping center that can vary substantially based on weather, permitting,
engineering and contractors. Under any circumstances, the lease shall not
commence until the Landlord has completed the Landlord's construction of the
addition as well as any other Landlord work required under the lease agreement,
and the Tenant has opened for business.

If the premises are not fully ready for the Tenant to open for business by
December 31, 2005, at the latest, the Tenant at it's sole option, shall have the
right to terminate this lease without any responsibility to the Landlord.

If Landlord has not obtained the building permit for the construction of the
premises by August 1, 2005, either Party may terminate this Lease Agreement by
giving the other written notice.

This Lease is conditioned upon the approval of it by the Board of Directors of
Old Line Bancshares Inc., and all Regulatory Approval required by State and
Federal law, on or before Nov 1, 2004.

                                       2A
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Landlord will install a drive through canopy and curb. Tenant will be
responsible for any teller window, mechanical equipment and tubing for the use
of the space described in the lease agreement. Tenant shall have the right to
install an ATM banking machine at the location shown on the attached plat, as
per the terms contained in Exhibit D.

                                       2B
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      Rent for any period which is for less than one (1) month shall be a
prorated portion of the monthly installment herein based upon a thirty (30) day
month. Said rental shall be paid to Landlord, without deduction or offset, in
lawful money of the United States of America and at such place as Landlord may
from time to time designate in writing.

5.    RENTAL ADJUSTMENTS.

      5.1   REAL ESTATE TAXES.

      In case of any increase, in any tax year during the term of this lease, of
the taxes on the land, buildings or improvements payable by the Landlord with
respect to the building in which the leased premises are located (by increase in
assessment or in tax rate or special assessment) over the amount of such taxes
due and payable in the 2004/2005 tax year, then the Tenant shall pay the
Landlord as additional rent, within thirty (30) days after such tax or
installment thereof shall be due and payable by the Landlord, an amount equal to
the tax increase multiplied by a fraction, the numerator of which shall be the
number of square feet of floor space in the leased premises and the denominator
of which shall be the total number of square feet in said building. In the event
the office of County Assessor does not fully assess the building in which
demised premises are located for the tax year 2004/2005 as aforestated, the
Tenant's increase in taxes shall not become effective until there is an increase
in taxes over and above the first year for which there is a full assessment or
both land and improvements. This amount shall not be part of the base rent for
purposes of the Base Rent Adjustment.

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      5.2   BASE RENT ADJUSTMENT.

      Upon each anniversary date of the commencement of the rental payments of
this Lease, the Base Rent shall be changed to reflect an increase of 2.5% over
the previous year's base rental rate.

      5.3   OTHER CHARGES.

      In addition to the rental otherwise provided in this Lease, and as of the
commencement of the obligation to pay Base Rent, Tenant shall pay to Landlord
the following items, herein called Adjustments, that percentage of the total
cost of the following items as Tenant's total floor area bears to the total
floor area of the Office and Retail Center:

            (i) All coats to supervise and administer, maintain and operate
parking lot lighting.

            (ii) Any parking charges, utilities surcharges, or any other costs
levied, assessed or imposed by or at the direction of or resulting from statutes
or regulations or interpretations thereof, promulgated by any governmental
authority in connection with the use or occupancy of the Premises or the parking
facilities serving the Premises.

6.    PERSONAL PROPERTY TAXES

      Tenant shall pay before delinquency all taxes, assessments, license fees
and public charges levied, assessed or imposed upon or measured by the value of
its business operation or its furniture, fixtures, leasehold improvements,
equipment and other property of Tenant at any time situated on or installed in
the Premises by Tenant. If at any time during the term of this Lease any of the
foregoing are assessed as a part of the real property of which the Premises are
a part, Tenant shall pay to Landlord upon demand the amount of such additional
taxes as may be levied against said real property by reason thereof as
reasonably apportioned by Landlord.

7.    USE

      7.1 USE. Tenant shall use the Premises for Banking.

      7.2 SUITABILITY. Tenant acknowledges that neither Landlord nor any agent
of Landlord has made any representation or warranty with respect to the premises
of the suitability of the premises or

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the Office and Retail Center for the conduct of Tenant's business, nor has
Landlord agreed to undertake any modification, alteration or improvement to the
Premises except as provided in this Lease. The taking of possession of the
Premises by Tenant shall conclusively establish that the Premises were at such
time in satisfactory condition unless within fifteen (15) days after such date
Tenant shall give Landlord written notice specifying in reasonable detail the
respects in which the Premises or the building were not in satisfactory
condition.

         7.3      USES PROHIBITED.

                  A. Tenant agrees that it will not use or permit any person to
use the Premises for a second-hand store, auction, distress or fire sale or
bankruptcy or going-out-of-business sale (whether or not pursuant to any
insolvency proceedings), or for any use or purpose in violation of any
governmental law or authority. Tenant shall at its sole cost and expense
promptly comply with all laws, statutes, ordinances and governmental rules,
regulations and requirements now in force or which may hereafter be in force and
with the requirements of any board of fire underwriters or other similar body
now or hereafter constituted relating to or affecting the condition, use or
occupancy of the Premises, excluding structural changes not relating to or
affecting the condition, use of occupancy of the Premises or not related or
afforded by Tenant's improvements or acts. The judgment of any court of
competent jurisdiction, the indictment by a Grand Jury or the State or Federal
Prosecution for any unlawful use of the premises or the admission of Tenant in
any action against Tenant, whether Landlord be a party thereto or not, that
Tenant has violated any law, statute, ordinance or governmental rule, regulation
or requirement, shall be conclusive of that fact as between Landlord and Tenant.

                  B. Tenant may not display or sell merchandise or allow carts,
portable signs, devices or any other objects to be stored or to remain outside
the defined exterior walls and permanent doorways of the Premises. Tenant
further agrees not to install any exterior lighting, amplifiers or similar
devices or use in or about the Premises any advertising medium which may be
heard or seen outside the Premises, such as flashing lights, searchlights,
loudspeakers, phonographs or radio broadcasts.

                  C. Tenant shall not do or permit anything to be done in or
about the Premises nor bring or keep anything therein which will in any way
increase the existing rate or affect any fire or other insurance upon the
Premises or any building of which the Premises may be a part or any of its
contents (unless Tenant shall pay any increased premium as a result of such use
or acts), or cause a cancellation of any insurance policy covering the Premises
or any building of which the Premises may be a part or any of its contents, nor
shall Tenant sell or permit to be kept, used or sold in or about the Premises
any articles which may be prohibited by a standard form policy of fire
insurance.

                  D. Tenant shall not do or permit anything to be done in or
about the Premises which will in any way obstruct or interfere with the rights
of other tenants or occupants of the building of which the Premises may be part
or any other building in the Office and Retail Center, or injure or annoy them,
or use or allow the Premises to be used for any unlawful or objectionable
purpose, nor shall Tenant cause, maintain or permit any nuisance in, on or about
the Premises. Tenant shall not commit or allow to be committed any waste in or
upon the Premises. Tenant shall keep the Premises in a clean and wholesome
condition, free of any pests, objectionable noises, odors or nuisances.

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8.       UTILITIES

         Tenant agrees to pay for all water, gas, power and electric current and
all other utilities supplied to the Premises. If any utilities are furnished by
Landlord, then the rates charged to Tenant shall not exceed those of the local
public utility company if its services were furnished directly to Tenant, and
shall not be less than its pro rata share of any jointly metered service as
reasonably determined by Landlord. Landlord shall not be liable in damages or
otherwise for any failure or interruption of any utility service being furnished
to the Premises.

9.       MAINTENANCE AND REPAIRS; ALTERATIONS AND ADDITIONS; FIXTURES

         9.1      MAINTENANCE AND REPAIRS

                  A. REPAIRS BY LANDLORD. Landlord shall repair and maintain the
structural portion of the Premises, including exterior walls and roof but
excluding windows, plate glass and doors, unless such maintenance or repair is
caused in whole or in part by the neglect, fault or omission of Tenant, its
agents, employees or invitees, or by unauthorized breaking and entering, in
which event Tenant shall pay to Landlord the cost of such maintenance and
repair. Landlord shall have no obligation to repair until a reasonable time
after the receipt by Landlord of written notice of the need for repairs. Unless
otherwise specifically provided in this lease, there shall be no abatement of
rent and no liability of Landlord by reason of any injury to or interference
with Tenant's business arising from the making of any repairs, alterations or
improvements in or to any portion of the Premises, the building or the Office
and Retail Center. Tenant waives the provisions of any law permitting Tenant to
make repairs at Landlord's expense. Landlord shall have no liability to Tenant
for any damage, inconvenience or interference with the use of the Premises by
Tenant as a result of performing any such work or by reason of

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undertaking the repairs required by Section 10.1A above.

                  B. REPAIRS BY TENANT. Tenant shall maintain in good order,
condition and repair the interior of the Premises, including all heating and
electrical equipment, any air conditioning equipment (and if there is an air
conditioning system, Tenant shall pay W. F. Chesley Real Estate, Inc. Property
Management for a service contract for repairs and maintenance of said system to
conform to the terms or requirements of any warranty which may be in effect) and
plumbing and sprinkle systems installed therein, and the improvements and
equipment installed by Tenant in the Premises, and shall replace all broken
glass, including plate glass and exterior show windows, and repair any broken
doors. Tenant shall make all other repairs, whether of alike or different
nature, except those which Landlord is specifically obligated to make under the
provisions of Section 10.1A above. Further, Tenant will insure the risk of the
maintenance of the plate glass and exterior show windows.

                  C. TENANT'S FAILURE TO MAINTAIN. In the event Tenant fails to
maintain the Premises in good order, condition and repair, Landlord shall give
Tenant notice to do such acts as are reasonably required so to maintain the
Premises. In the event Tenant fails promptly to commence such work or diligently
prosecute the same to completion, Landlord may but is not obligated to do such
acts and expend such funds at the expense of Tenant as are reasonably required
to perform such work. Any amount so expended by Landlord shall be paid by Tenant
promptly after demand with interest at twelve percent (12%) per annum from the
date of such work.

                  D. CONDITION UPON EXPIRATION OF TERM. Upon the expiration or
earlier termination of this Lease, Tenant shall surrender the Premises in good
broom clean condition, ordinary wear and tear and damage by causes beyond the
reasonable control of Tenant only excepted. Tenant shall indemnify Landlord
against any loss or liability resulting from delay by Tenant in so surrendering
the Premises including without limitation any claims made by any succeeding
tenant founded on such delay.

         9.2      ALTERATIONS AND ADDITIONS

                  A. Tenant shall not make any alterations or additions to the
Premises without Landlord's prior written consent. All alterations, additions,
and improvements made by Tenant to or upon the Premises, except counters or
other removable trade fixtures, shall at once when made or installed be deemed
to have attached to the freehold and to have become the property of Landlord;
provided, however, if prior to termination of this Lease, or within fifteen (15)
days thereafter, landlord so directs by written notice to Tenant, Tenant shall
promptly remove the additions, improvements, fixtures, trade fixtures and
installations which were placed in the Premises by Tenant and which are
designated in said notice and shall repair any damage occasioned by such removal
and in default thereof Landlord may effect said removal and repairs at Tenant's
expense.

                 B. Before commencing any such work or construction in or about
the Premises, Tenant shall notify Landlord in writing of the expected date of
commencement thereof. Landlord shall have the right at any time and from time to
time to post and maintain on the Premises such notices as Landlord deems
necessary to protect the Premises and Landlord from mechanics' liens,
materialmen's liens, or any other liens.

         9.3      INSTALLATION OF FIXTURES

                  It is mutually agreed that in order to expedite the

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commencement of Tenant's business in the Premises, Tenant may enter upon the
Premises for the purpose of installing trade fixtures and furnishings during the
construction period, provided that such activity on the part of Tenant shall be
done only in such manner as not to interfere with construction and that Landlord
shall not be liable to Tenant for damage to or loss of such fixtures, equipment
or furnishings, Tenant accepting the full risk for such damage or loss, if any.
Tenant shall pay for all utilities consumed by Tenant or its contractors in
preparing the Premises for the opening of Tenant's business.

         9.4      JANITORIAL SERVICE

         Tenant shall at his cost arrange for the interior cleaning of the
leased premises, including interior windows, dusting, waxing and/or carpet
cleaning. Tenant further shall provide and maintain a dumpster at the exterior
of the building or pay his proportionate share of the cost of a dumpster
provided by the Landlord. If Tenant does use the dumpster provided by the
Landlord, Tenant's costs for this service shall be paid monthly with the regular
rental payment and the cost shall be adjusted as the Landlord's costs are
adjusted by the company providing the dumpster service.

10.      ENTRY BY LANDLORD

         Landlord, its agents, employees, or mortgagee may enter the Premises at
all reasonable times for the purpose of exhibiting the same to prospective
purchasers or tenants, so long as it does not violate banking laws, Federal &
State laws.

         Tenant hereby grants to Landlord such licenses or easements in and over
the Premises or any portion thereof as shall be reasonably required for the
installation or maintenance of mains, conduits, pipes or other facilities to
serve the Office and Retail Center or any part thereof.

         Landlord, its agents and employees, shall have free access to the
Premises during all reasonable hours for the purpose of examining the same to
ascertain if they are in good repair and to make reasonable repairs which
Landlord may be required or permitted to make hereunder.

11.      LIENS

         Tenant shall keep the Premises and the property in which the Premises
are situated free from any liens arising out of any work performed, materials
furnished, or obligations incurred by or on behalf of Tenant.

12.      INDEMNITY

         12.1     INDEMNITY.

                  Tenant shall indemnify and hold harmless Landlord from and
against any and all claims arising from Tenant's use of the Premises or the
conduct of its business or from any activity, work, or thing done, permitted or
suffered by Tenant in or about the Premises, and shall further indemnify and
hold Landlord harmless from and against any and all claims arising from any
breach or default in the performance of any obligation on Tenant's part to be
performed under the terms of this Lease, or arising from any act or negligence
of Tenant or any of its agents, employees, guests or invitees, and from and
against all costs,

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attorney's fees, expenses and liabilities incurred in or about any such claim or
any action or proceeding brought thereon; and in case any action or proceeding
be brought against Landlord by reason of any such claim, Tenant upon notice from
Landlord shall defend the same at Tenant's expense by counsel reasonably
satisfactory to Landlord. Tenant, as a material part of the consideration to
Landlord, hereby assumes all risk of damage to property or injury to persons in,
upon or about the premises from any cause other than Landlord's negligence or
misconduct, and Tenant hereby waives all claims in respect thereof against
Landlord.

         12.2     EXEMPTION OF LANDLORD FROM LIABILITY.

                  Except for the negligence or misconduct of Landlord, Landlord
shall not be liable for injury or damage which may be sustained by the person,
good, wares, merchandise or property of Tenant, its employees, invitees or
customers, or any other person in or about the Premises, caused by or resulting
from fire, steam, electricity, gas, water or rain, which may leak or flow from
or into any part of the Premises, or from the breakage, leakage, obstruction or
other defects of the pipes, sprinklers, wires, appliances, plumbing, air
conditioning or lighting fixtures, whether the damage or injury results from
conditions arising upon the Premises or upon other portions of the building of
which the Premises are a part, or from any other source. Landlord shall not be
liable for any damage arising from any act or neglect of any other tenant of the
Office and Retail Center.

13.      LIABILITY INSURANCE

         Tenant shall, at Tenant's expense, obtain and keep in force during the
term of this Lease a policy of comprehensive, public liability insurance
insuring Landlord and Tenant against any liability arising out of the ownership,
use, occupancy or maintenance of the Premises and all areas appurtenant thereto
in a combined single limit of not less than $1,000,000 for bodily injury and/or
property damage. The limits of such insurance shall not limit the liability of
Tenant hereunder. Tenant may provide this insurance under a blanket policy,
provided that said insurance shall have a Landlord's protective liability
endorsement attached thereto. If Tenant shall fail to procure and maintain said
insurance, Landlord may, but shall not be required to procure and maintain same,
but at the expense of Tenant. Insurance required hereunder shall be in companies
rated A+AAA or better in "Best's Insurance Guide". Tenant shall deliver to
Landlord, prior to right of entry, copies of policies of liability insurance
required herein or certificates evidencing the existence and amounts of such
insurance with loss payable clauses satisfactory to Landlord. No policy shall be
cancellable or subject to reduction or coverage. All such policies shall be
written as primary policies not contributing with and not in excess of coverage
which Landlord may carry.

14.      DAMAGE OR DESTRUCTION

         In the event the Premises are damaged by fire or other perils covered
by extended coverage insurance, Landlord agrees forthwith to repair them, and
this Lease shall remain in full force and effect, except that Tenant shall be
entitled to a proportionate reduction of the Base Rent from the date of damage
and while such repairs are being made, such proportionate reduction to be based
upon the extent to which the damage and making of such repairs shall reasonably
interfere with the business carried on by Tenant in the Premises. If the damage
is due to the fault or neglect of Tenant, its agents or employees, there shall
be no abatement of rent.

         In the event the Premises are damaged as a result of any

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cause other than the perils covered by fire and extended coverage insurance, the
Landlord shall forthwith repair them provided the extent of the destruction is
less than ten percent (10%) of the then full replacement cost of the Premises.
In the event the destruction of the Premises is to an extent of ten percent
(10%) or more of the then full replacement cost, Landlord shall have the option
either (1) to repair or restore such damage, this Lease continuing in full force
and effect but the Base Rent to be proportionately reduced as above stated, or
(2) to give notice to Tenant at any time within sixty (60) days after such
damage, terminating this Lease as of the date specified in such notice, which
date shall be no more than thirty (30) days after the giving of such notice. In
the event of giving such notice, this Lease shall expire and all interest of
Tenant in the Premises shall terminate on the date so specified in such notice
and the Base Rent, reduced by a proportionate reduction as above stated, shall
be to the date of such termination.

         Notwithstanding anything to the contrary contained in this Article,
Landlord shall have no obligation to repair, reconstruct or restore the Premises
when the damage resulting from any casualty covered under this Article occurs
during the last twenty-four (24) months of the term of this Lease or any
extension thereof. If fifty percent (50%) or more of the Office and Retail
Center is damaged by any cause even though the premises may not be affected,
Landlord may give notice to Tenant at any time within sixty (60) days after such
damage, terminating this Lease as of the date specified in such notice, which
date shall be no more than thirty (30) days after the giving of such notice
Landlord shall not be required to repair any injury or damage by fire or other
cause, or to make any repairs or replacements of any leasehold improvements,
fixtures, or other personal property of Tenant.

15.      CONDEMNATION

         If twenty-five percent (25%) or more of the Premises shall be taken or
appropriated by any public or quasi-public authority under the power of eminent
domain, either party hereto shall have the right, at its option, within sixty
(60) days after such taking or appropriation, to terminate this Lease upon
thirty (30) days' written notice to the other. If any part of the Premises are
so taken (and neither party elects to terminate as herein provided), the Base
Rent thereafter to be paid shall be equitably reduced. If any part of the Office
and Retail Center other than the Premises is so taken, Landlord shall have the
right, at its option, within sixty (60) days of said taking, to terminate this
Lease upon written notice to Tenant. In the event of any taking or appropriation
whatsoever, landlord shall be entitled to any and all awards and/or settlements
which may be given and Tenant shall have no claim against Landlord for the value
of any unexpired term of this Lease. Nothing contained herein, however, shall be
deemed to preclude Tenant from obtaining, or to give Landlord any interest in,
any award to Tenant for loss or damage to Tenant's trade fixtures and removable
personal property or for damage for cessation or interruption of Tenant's
business.

16.      ASSIGNMENT AND SUBLEASE

         Tenant shall not voluntarily or by operation of law assign, transfer,
mortgage or otherwise encumber all or any part of Tenant's interest in this
Lease or in the Premises, and shall not sublet or license all or any part of the
Premises, without the prior written consent of Landlord in each instance, and
any attempted assignment, transfer, mortgage, encumbrance, subletting or license
without such consent shall be wholly void. Without in any way limiting
Landlord's right to refuse to give such consent for any other reason or reasons,
Landlord reserves the right to refuse to give such consent if in Landlord's
sole discretion and

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opinion the quality of merchandising operation is or may be in anyway adversely
affected during the term of this Lease or the financial worth of the proposed
new tenant is less than that of the Tenant executing this Lease at the time of
such execution.

         No subletting or assignment, even with the consent of Landlord, shall
relieve Tenant of its obligation to pay the rent and to perform all of the other
obligations to be performed by Tenant hereunder. The acceptance of rent by
Landlord from any other person shall not be deemed to be a waiver by Landlord of
any provision of this Lease or to be a consent to any assignment, subletting or
other transfer. Consent to one assignment, subletting or other transfer shall
not be deemed to constitute consent to any subsequent assignment, subletting or
other transfer. The covenants and conditions herein contained shall apply and
bind the heirs, successors, executors, administrators and assigns of Tenant. If
the Bank merges with another bank or in any way changes it's banking structure,
the successor entity shall have all rights under this Lease & the Landlord may
not object to an Assignment under this Lease.

17.      WAIVER OF SUBROGATION

         Landlord and Tenant hereby mutually waive their respective rights of
recovery against each other for any loss insured by fire, extended coverage and
other property insurance policies existing for the benefit of the respective
parties. Each party shall apply to its insurer to obtain said waivers and shall
secure any special endorsements if required by its insurer to comply with this
provision.

18.      SUBORDINATION; ATTORNMENT; QUIET ENJOYMENT

         18.1     SUBORDINATION.

                  This Lease shall be subordinate to all ground or underlying
leases which now exist or may hereafter be executed affecting the Premises or
the land upon which the Premises are situated or both, and to the lien of any
mortgages or deeds of trust in any amount or amounts whatsoever now or hereafter
placed on or against the land or improvements or either thereof, of which the
Premises are a part, or on or against Landlord's interest or estate therein, or
on or against any ground or underlying leases. Tenant agrees to execute any
further instruments which may be requested or required to evidence such
subordination. If any mortgagee, trustee or ground lessor shall elect to have
this Lease prior to the lien of its mortgage, deed of trust or ground lease, and
shall give written notice thereof to Tenant, this Lease shall be deemed prior to
such mortgage, deed of trust or ground lease, whether this Lease is dated prior
or subsequent to the date of said mortgage, deed of trust or ground lease or the
date of the recording thereof.

         18.2     ATTORNMENT.

                  In the event any proceedings are brought for default under any
ground or underlying lease or in the event of foreclosure or the exercise of the
power of sale under any mortgage or deed of trust covering the Premises, Tenant
shall attorn to the Purchaser upon any such foreclosure or sale and recognize
such purchaser as the Landlord under this Lease, provided said Purchaser
expressly agrees in writing to be bound by the terms of this Lease.

         18.3     QUIET ENJOYMENT.

                  Upon Tenant paying the rent reserved herein and observing and
performing all of the provisions on Tenant's part to be observed and performed
hereunder, including compliance with any Covenants, Conditions or Restrictions
affecting the Premises or the Office and Retail Center. Tenant shall have quiet
possession of the Premises during the entire term of this Lease, subject to

                                       11
<PAGE>

all provisions hereof and of any such Covenants, Conditions or Restrictions, and
to the terms of any said ground or underlying lease, mortgage or deed of trust.

19.   DEFAULT; REMEDIES

      19.1 DEFAULT. The occurrence of any of the following shall constitute a
default and breach of this Lease by Tenant:

            A. Any failure by Tenant to pay the rent or any other monetary sums
required to be paid hereunder (where such failure continued for five (5) days
after written notice by Landlord to Tenant);

            B. The abandonment or vacating of the Premises by Tenant;

            C. A failure by Tenant to observe or perform any other provision of
this Lease to be observed or performed by Tenant, where such failure continues
for thirty (30) days after written notice thereof by Landlord to Tenant;
provided, however, that if the nature of the default is such that the same
cannot reasonably be cured within said thirty (30) day period, Tenant shall not
be deemed to be in default if Tenant shall within such period commence such cure
and thereafter diligently prosecute the same to completion;

            D. The making by Tenant of any general assignment or general
arrangement for the benefit of creditors; the filing by or against Tenant of a
petition to have Tenant adjudged a bankruptcy or of a petition for
reorganization or arrangement under any law relating to bankruptcy (unless, in
the case of a petition filed against Tenant, the same is dismissed within sixty
(60) days; the appointment of a trustee or receiver to take possession of
substantially all of Tenant's assets located at the Premises or of Tenant's
interest in this Lease, where possession is not restored to Tenant within thirty
(30) days; or the attachment, execution or other judicial seizure of
substantially all of Tenant's assets located at the Premises or of Tenant's
interest in this Lease, where such seizure is not discharged within thirty (30)
days.

      19.2 REMEDIES. In the event of any such default or breach by Tenant,
Landlord may at any time thereafter, without limiting Landlord in the exercise
of any right or remedy at law or in equity which Landlord may have by reason of
such default or breach:

            A. Maintain this Lease in full force and effect and recover the rent
and other monetary charges as they become due, without terminating Tenant's
right to possession, irrespective of whether Tenant shall have abandoned the
Premises. In the event Landlord elects not to terminate this Lease, Landlord
shall have the right to attempt to re-let the Premises at such rent and upon
such conditions and for such a term, and to do all acts necessary to maintain or
preserve the Premises, as Landlord deems reasonable and necessary, without being
deemed to have elected to terminate this Lease, including removal of all persons
and property from the Premises; such property may be removed and stored in a
public warehouse or elsewhere at the cost of and for the account of Tenant. In
the event any such re-letting occurs, this Lease shall terminate automatically
upon the new tenant taking possession of the Premises. Notwithstanding that
Landlord fails to elect to terminate this Lease initially, Landlord at any time
during the term of this Lease may elect to terminate this Lease by virtue of
such previous default of Tenant.

            B. Terminate Tenant's right to possession by any lawful means, in
which case this Lease shall terminate and Tenant

                                       12
<PAGE>

shall immediately surrender possession of the Premises to Landlord. In such
event Landlord shall be entitled to recover from Tenant all damages incurred by
Landlord by reason of Tenant's default, including without limitation the
following: (i) The worth at the time of award of any unpaid rent which had been
earned at the time of such termination; plus (ii) the worth at the time of award
of the amount by which the unpaid rent which would have been earned after
termination until the time of award exceeds the amount of such rental loss that
is proved could have been reasonably avoided, plus (iii) the worth at the time
of award of the amount by which the unpaid rent for the balance of the term
after the time of award exceeds the amount of such rental loss that is proved
could be reasonably avoided; plus (iv) any other amount necessary to compensate
Landlord for all the detriment proximately caused by Tenant's failure to perform
his obligations under this Lease or which in the ordinary course of events would
be likely to result therefrom; plus (v) at Landlord's election, such other
amounts in addition to or in lieu of the foregoing as may be permitted from time
to time by applicable State law. Upon any such re-entry Landlord shall have the
right to make any reasonable repairs, alterations or modifications to the
Premises which Landlord in its sole discretion deems reasonable and necessary.

            As used in (i) above, the "worth at the time of award" is computed
by allowing interest at the rate of eight percent(8%) per annum from the date of
default. As used in (ii) and (iii) above, the "worth at the time of award" is
computed by discounting such amount at the discount rate of the U.S. Federal
Reserve Bank at the time of award plus one percent (1%). The term "rent", as
used in this Section 20, shall be deemed to be the rent to be paid pursuant to
Section 3 and all other monetary sums required to be paid by Tenant pursuant to
the terms of this Lease.

      19.3 LATE CHARGES. Tenant hereby acknowledges that late payment by Tenant
to Landlord of rent or other sums due hereunder will cause Landlord to incur
costs not contemplated by this Lease, the exact amount of which will be
extremely difficult to ascertain. Such costs include, but are not limited to,
processing and accounting expenses and late charges which may be imposed on
Landlord by the terms of any mortgage or deed of trust covering the Premises.
Accordingly, if any installment of rent or any other sum due from Tenant shall
not be received by Landlord or Landlord's designee within ten (10) days after
such amount shall be due, Tenant shall pay to Landlord a late charge equal to
five percent (5%) of such overdue amount. The parties hereby agree that such
late charge represents a fair and reasonable estimate of the costs that Landlord
would incur by reason of late payment by Tenant. Acceptance of such late charge
by Landlord shall in no event constitute a waiver of Tenant's default with
respect to such overdue amount, nor prevent Landlord from exercising any of the
other rights and remedies granted hereunder.

      19.4 DEFAULT BY LANDLORD. Landlord shall not be in default unless Landlord
fails to perform obligations required of it within a reasonable time, but in no
event later than thirty (30) days after written notice by Tenant to Landlord. If
the nature of Landlord's obligation is such that more than thirty (30) days are
required for performance, then Landlord shall not be in default if Landlord
commences performance within such thirty (30) day period and thereafter
diligently prosecutes the same to completion.

20.   PARKING AND COMMON AREAS

      Landlord covenants certain common and parking areas shall be at all times
available for the non-exclusive use of Tenant during the full term of this
Lease, provided that the condemnation or other taking by any public authority,
or sale in lieu of

                                       13
<PAGE>

condemnation, of any or all of such common and parking areas shall not
constitute a violation of this covenant, and Landlord reserves the right to
close, if necessary, all or any portion of such common or parking areas to such
extent as may in the opinion of Landlord's counsel be legally necessary to
prevent a dedication thereof or the accrual of any rights of any person or of
the public therein; to close temporarily all or any portion of the common areas
to discourage non-customer use; to use portions of the common areas while
engaged in making additional improvements or repairs or alterations to the
Office and Retail Center; and to do and perform such other acts in, to, and with
respect to the common areas as Landlord shall reasonably determine to be
appropriate for the Office and Retail Center. Landlord further reserves the
right to increase or reduce the common areas and to change the entrances, exits,
traffic lanes and the boundaries and locations of such common and parking areas,
provided that no such modifications or changes shall commercially reduce the
total amount of the common or parking areas available under this Section, and so
long as it does not impact the Tenant's business. Tenant shall have a min. of 4
spaces close to it's premises designated for it's customers.

      Landlord shall keep said parking and common areas in a neat, it's premise
clean and orderly condition and shall repair any damage to the designated
facilities thereof.

      Tenant, for the use and benefit of Tenant, its agents, employees,
customers, licensees and sub-tenants, shall have the non-exclusive right in
common with Landlord, and other present and future owners and tenants and their
agents, employees, customers, licensees and sub-tenants, to use said common and
parking areas during the entire term of this Lease.

      Tenant, in the use of said common and parking areas, agrees to comply with
such reasonable rules and regulations and charges for parking as Landlord may
adopt from time to time for the orderly and proper operation of said common and
parking areas. Such rules may include but shall not be limited to the following:
 (1) Restriction of employee parking to a limited, designated area or areas; and
(2) Regulation of the removal, storage and disposal of Tenant's refuse and other
rubbish at the sole cost and expense of Tenant.

21.   MERCHANTS ASSOCIATION

      Tenant will become a member of and participate fully and remain in good
standing in the Merchants Association (as soon as it has been formed), organized
for tenants occupying space in the Office and Retail Center, and Tenant will
abide by the regulations of such Association. Each member tenant shall have (1)
vote, and Landlord shall also have one (1) vote in the operation of said
Association. The objectives of such Association shall be to encourage its
members to deal fairly and courteously with their customers, to encourage
ethical business practices, and to assist the business of the tenants by sales
promotion and centerwide advertising. Tenant agrees to pay the dues established
by and to the Merchants Association, provided that in no event shall the dues
paid by Tenant in any fiscal year of said Association exceed twenty-five cents
(.25) per square foot of the Premises leased to Tenant. Default in payment of
dues shall be treated in similar manner to default in rent with like rights of
Landlord at its option to the collection thereof on behalf of the Merchants
Association.

22.   SIGNS

      22.1 EXTERIOR. Tenant shall not place or suffer to be placed on the
exterior of the Premises or upon the roof of any exterior door or wall or on the
exterior or interior of any window thereof any sign, awning, canopy, marquee,
advertising matter, decoration, lettering, or any other thing of any kind
(exclusive

                                       14
<PAGE>

of the signs, if any, which may be provided for in the original construction or
improvement plans and specifications approved by the Landlord and Tenant
hereunder) without the written consent of Landlord first had and obtained.
Landlord hereby reserves the exclusive right to the use of the roof and exterior
walls of the building of which the Premises are a part, for any purpose
whatsoever.

      22.2 INTERIOR. Except as otherwise herein provided, Tenant shall have the
right, at its sole cost and expense, to erect and maintain within the interior
of the Premises all signs and advertising matter customary or appropriate in the
conduct of Tenant's business; provided, however, that Tenant shall upon demand
of the Landlord immediately remove any sign, advertisement, decoration,
lettering or notice which Tenant has placed or permitted to be placed in, upon
or about the Premises and which Landlord reasonably deems objectionable or
offensive, and if Tenant fails or refuses so to do Landlord may enter upon the
Premises and remove the same at Tenant's cost and expense. In this connection,
Tenant acknowledges that the Premises are a part of an integrated Office and
Retail Center in which the control of signs, among other things, is governed by
the Landlord and Tenant agrees to be bound by such provisions.

      22.3 WINDOWS. Tenant shall at all times maintain its show windows and
signs in a neat, clean and orderly condition. If, as to any sign, Tenant shall
fail to do so after five (5) days' written notice from Landlord, Landlord may
repair, clean or maintain such sign and the cost thereof shall be payable by
Tenant to Landlord upon demand as additional rent.

23.   MISCELLANEOUS

      23.1 RULES AND REGULATIONS. Tenant shall faithfully observe and comply
with the rules and regulations that Landlord shall from time to time promulgate
and/or modify. Landlord shall not be responsible to Tenant for the
non-performance of any of said rules and regulations by any other tenants or
occupants.

      23.2 ESTOPPEL CERTIFICATE. Tenant shall at any time and from time to time,
upon not less than three (3) days prior written notice from Landlord, execute,
acknowledge and deliver to Landlord a statement in writing (a) certifying that
this Lease is unmodified and in full force and effect (or, if modified, stating
the nature of such modification and certifying that this Lease as so modified is
in full force and effect), and the date to which the rental and other charges
are paid in advance, if any, and (b) acknowledging that there are not, to
Tenant's knowledge, any uncured defaults on the part of Landlord hereunder, or
specifying such defaults if any are claimed, and (c) setting forth the date of
commencement of rents and expiration of the term hereof. Any such statement may
be relied upon by any prospective purchaser or encumbrancer of all or any
portion of the real property of which the Premises are a part.

      23.3 TRANSFER OF LANDLORD'S INTEREST. In the event of a sale or conveyance
by Landlord of Landlord's interest in the Premises or the Office and Retail
Center, other than a transfer for security purposes only, Landlord shall be
relieved of all obligations and liabilities accruing thereafter on the part of
Landlord provided that any funds in the hands of Landlord at the time of
transfer in which Tenant has an interest shall be delivered to Landlord's
successor.

      23.4  CAPTIONS; ATTACHMENTS; DEFINED TERMS.

            A. The captions of the paragraphs of this Lease are for convenience
only and shall not be deemed to be relevant in

                                       15
<PAGE>

resolving any question of interpretation or construction of any section of this
Lease.

            B. Exhibits and addenda attached or affixed hereto are deemed a part
of this Lease and are incorporated herein by reference.

            C. If there be more than one Tenant, the obligations hereunder
imposed shall be joint and several, as to a Tenant which consists of husband and
wife, the obligations shall extend individually to their sole and separate
property as well as their jointly held property. The term "Landlord" shall mean
only the owner or owners at the time in question of the fee title or a tenant's
interest in a ground lease of the Premises or the Office and Retail Center. The
obligations contained in this Lease to be performed by Landlord shall be binding
on Landlord's successors and assigns only during their respective period of
ownership.

      23.5 ENTIRE AGREEMENT. This Lease constitutes the entire agreement between
Landlord and Tenant relative to the Premises and supersedes any prior
agreements, brochures or representations, whether written or oral. This Lease
may be altered, amended or revoked only by an instrument in writing signed by
both Landlord and Tenant. This Lease shall not be effective or binding on any
party until fully executed by both parties hereto.

      23.6 SEVERABILITY. If any provision of this Lease shall be determined by a
court of competent jurisdiction to be invalid or unenforceable, the remainder of
this Lease shall not be affected thereby, and each term and provision of this
Lease shall be valid and enforceable to the fullest extent permitted by law.

      23.7 COSTS OF SUIT. If Landlord shall bring any action for any relief
against Tenant, declaratory or otherwise, arising out of this Lease, including
any suit by Landlord for the recovery of rent or possession of the Premises, the
Tenant shall pay the Landlord a reasonable sum for attorney's fees which shall
be deemed to have accrued on the commencement of such action and shall be paid
whether or not such action is prosecuted to judgment.

      23.8 BINDING EFFECT; CHOICE OF LAW. The parties hereto agree that all the
provisions hereof to be construed as both covenants and conditions as though the
words importing such covenants and conditions were used in each separate
paragraph hereof, and all rights and remedies of the parties shall be cumulative
and non-exclusive of any other remedy at law or in equity. This Lease shall be
governed by the laws of the State of Maryland.

      23.9 WAIVER. No covenant, term or condition or the breach thereof shall be
deemed waived, except by written consent of the party against whom the waiver is
claimed, and any waiver or the breach of any covenant, term or condition shall
not be deemed to be a waiver of any covenant, term or condition. Acceptance by
Landlord of any performance by Tenant after the time the same shall have become
due shall not constitute a waiver by Landlord of the breach or default of any
covenant, term or condition unless otherwise expressly agreed to by Landlord in
writing.

      23.10 SURRENDER OF PREMISES. The voluntary or other surrender of this
Lease by Tenant, or a mutual cancellation thereof, shall not work a merger, and
shall at the option of Landlord terminate all or any existing subleases or may
at the option of Landlord operate as an assignment to it of any or all such
subleases.

      23.11 HOLDING OVER. If Tenant remains in possession of the

                                       16
<PAGE>

Premises after the expiration of the term hereof with the written consent of
Landlord, such occupancy shall be from month to month only, and not a renewal
hereof or an extension for any further term and in such case rent and other
monetary sums due hereunder shall be payable in the amount of 115% of the
existing rentals, and such month to month tenancy shall be subject to every
other term, covenant and agreement contained herein including rental
adjustments.

      23.12 INABILITY TO PERFORM. If either party hereto shall be delayed or
prevented from the performance of any act required hereunder by reason of
strike, labor trouble, acts of God or any other cause beyond the reasonable
control of such party (financial inability excepted), and such party is
otherwise without fault, then performance of such act shall be excused for the
period of the delay, provided that the foregoing shall not excuse Tenant from
the prompt payment of any rental or other charge required of Tenant hereunder
unless otherwise specifically so stated in this Lease.

      23.13 LANDLORD'S LIABILITY. Anything in the Lease to the contrary
notwithstanding, covenants, undertakings and agreements herein made on the part
of the Landlord are made and intended not as personal covenants, undertakings
and agreements or for the purpose of binding Landlord personally or the assets
of Landlord, except Landlord's interest in the premises and building, but are
made and intended for the purpose binding only the Landlord's interest in the
premises and building as the same may from time to time be encumbered. No
personal liability or personal responsibility is assumed by, nor shall at any
time be asserted or enforceable against Landlord, or its partners, or their
respective heirs, legal representatives, successors, and assigns on account of
the Lease or on account of any covenant, undertaking or agreement of Landlord in
this Lease contained.

      23.14 INTEREST ON PAST DUE OBLIGATION. Except as expressly herein
provided, any amount not paid to Landlord when due shall bear interest at eight
percent(8%) per annum from the due date. Payment of such interest shall not
excuse or cure any default by Tenant under this Lease.

      23.15 NOTICES. All notices or demands of any kind required or desired to
be given by Landlord or Tenant hereunder shall be in writing and shall be deemed
delivered forty-eight (48) hours after depositing the notice or demand in the
United States mail, certified or registered, postage prepaid, addressed to
Landlord or Tenant respectively at the addresses set forth after their
signatures at the end of this Lease.

      23.16 CORPORATE AUTHORITY. If Tenant is a corporation, each individual
executing this Lease on behalf of said corporation represents and warrants that
he is duly authorized to execute and deliver this Lease on behalf of said
corporation in accordance with the By-Laws of said corporation, and that this
Lease is binding upon said corporation in accordance with its terms.

      23.17 RECORDATION. Neither Landlord nor Tenant shall record this Lease. If
Landlord so elects, it may record a short form hereof, in which case Tenant
agrees to execute and deliver to Landlord a notarized copy of the memorandum of
such short form.

      23.18 BROKERS. Tenant warrants that it has had no dealings with any real
estate broker or agents in connection with the negotiation of this Lease,
excepting only W. F. Chesley Real Estate, Inc., and it knows of no other real
estate broker or agent who is entitled to a commission in connection with this
Lease. Tenant is aware that the Landlord is a licensed real estate broker in the
State of Maryland and waives any conflict of interest.

                                       17
<PAGE>

      IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease the date
and year first above written.

      (If Landlord or Tenant is a corporation, the corporate seal must he
affixed and the authorized officers must sign on behalf of the corporation. The
Lease must be executed by the President or a Vice President and the Secretary or
Assistant Secretary unless the By-Laws or a Resolution of the Board of Directors
shall otherwise provide, in which event the By-Laws or a certified copy of the
Resolution, as the case may be, must be furnished.)

Witness:                                       Landlord:

/s/ [ILLEGIBLE]                                /s/ William F. Chesley
-----------------------                        --------------------------------
                                               Ridgely I, LLC
                                               William F. Chesley, Manager

Witness:                                       Tenant:

/s/ [ILLEGIBLE]                                /s/ James W. Cornelsen
-----------------------                        --------------------------------
                                               Old Line Bank
                                               James W. Cornelsen, President &
                                               Chief Executive Officer

                                       18
<PAGE>

                           ADDENDUM TO LEASE AGREEMENT

                                    ATM LEASE

                                 REFERENCE PAGE

LESSOR:          Ridgely I, LLC

LESSEE:          Old Line Bank

LEASE PREMISES:  1641 Route 3 North, Crofton, Maryland

COMMENCEMENT
DATE:__________________

LEASE EXECUTION
DATE:07/07/04

RENT:              Rental is based on a minimum $1,50 surcharge. The rental
                   formula is as follows:

                   0 to 1,000 ATM transactions per month = $0.25/transaction
                   1,001 to 1,500 ATM transactions per month = $.35/transaction
                   1,501 and above ATM transactions per month = $.45/transaction

                   Transaction is defined as a withdrawal of funds by a
                   non-account holder so as to generate a fee to the
                   Lessee.

LIST OF EXHIBITS:               Exhibit A - ATM Specifications

The above information and definitions are incorporated into the Lease Agreement
attached to this Reference Page and initialed by Lessor. The Lease Agreement
will not become effective until Lessee has received the initialed Lease
Agreement, unless Lessee waives that requirement in its sole discretion. By
signing below, Lessor affirms that it has received the Lease Agreement.

LESSOR:                                  LESSEE:

BY: /s/ William F. Chesley               BY: /s/ James W. Cornelsen
    -------------------------                ----------------------------------
TITLE: Manager                           TITLE: President & CEO
<PAGE>

                                 LEASE ADDENDUM

      THIS LEASE ADDENDUM (the "Lease Addendum") is made by and between OLD LINE
BANK ("Bank"), Lessee and Ridgely I, LLC, Lessor, who mutually covenant and
agree as follows:

      THE REFERENCE PAGE IS INCORPORATED INTO AND MADE A PART OF THIS LEASE
ADDENDUM. DEFINED TERMS IN THIS LEASE WILL HAVE THE SAME MEANINGS AS SET FORTH
IN THE REFERENCE PAGE.

      1.    SCOPE AND EXCLUSIVITY. During the term of this Lease Addendum,
Lessor will exclusively furnish to Bank one space (the "Space" as provided on
the Reference Page) in a prominent and visible location in the Premises for the
installation and operation of an automated teller machine ("ATM") in such Space.
Lessor must not install (or permit any other entity under its control to
install) on or about the Premises any ATM, point of sale device, point of
purchase device, or any similar type of machine, or to offer electronic fund
transfer services by any other method at the Premises.

      The location of the ATM is subject to the Lessor and Lessee obtaining
approvals from the proper governmental authorities for the location and
operation of the ATM and the approval of the condominium regime.

      2.    TERM AND BANK'S OPTION TO RENEW. The initial term of this Lease
Addendum will coincide with the lease of the 2420 square feet by Lessee. This
Lease Addendum will automatically renew for three (3) additional terms of five
(5) years unless the Bank gives notice of its intention to allow the Lease
Addendum to expire no less than one hundred eighty (180) days prior to the end
of the Initial Term or any renewal term. Thereafter, the Lease Addendum will
continue to automatically renew for additional five (5) year terms unless either
party gives notice of its intention to allow the Lease Addendum to expire no
less than thirty (30) days prior to the end of the current renewal term. The
Initial Term, together with any renewal terms, are collectively referred to as
the "Term". Upon the expiration or termination of this Lease Addendum, the Bank
will have a reasonable amount of time to remove the ATM and all related
equipment (including all of its trade fixtures, furnishings, signs and personal
property) from the Premises, and to complete any necessary repairs.

      3.    POSSESSION. Lessor represents and warrants that Space will be ready
for the Bank's occupancy on the date the 2420 square feet are ready for
occupancy. If Lessor cannot deliver possession of the Space on the Commencement
Date, at the Bank's option, this Lease Addendum will not terminate, but the
Commencement Date will be extended for the period of such delay.

      4.    INSTALLATION AND OPERATION. The Bank will, without cost to Lessor,
operate, and maintain the ATM at the Premises. At its sole expense, Lessor will
provide a dedicated power outlet within three (3) feet of the Space, and provide
access at the installation site to utilities and telephone cable in the amounts
necessary for installation and operation of the Atm. Installation specifications
will be submitted by the Bank to Lessor before installation begins. The
specifications of the ATM will be consistent with those described in Exhibit
"A". Lessor

<PAGE>

shall do all work to prepare site for installation of the ATM at its expense.

      5.    RELOCATION. Any relocation of an ATM during the term will be
performed only with the written approval of the Bank and the Lessor. Lessor will
bear all expenses associated with a relocation requested by Lessor.

      6.    HOURS OF OPERATION. Subject to Lessor's compliance with its
obligations under this Lease Addendum, the Bank will use reasonable efforts to
ensure that each ATM is operational during normal operating hours of the
Premises and to comply with network uptime requirements. The Bank will contract
for a standard service contract on the ATM equipment. Service will be provided
Monday through Sunday 8 A.M. to 8 P.M. (local time). Lessor agrees to promptly
notify the Bank if an ATM is reported as broken or not operating.

      7.    SERVICE, MAINTENANCE AND CLEANING OF THE ATM. The Bank will be
responsible for all repairs, replacement parts, maintenance, and installation of
the ATM. Service personnel will, at all times, be dressed in clean appropriate
attire, and will observe all regulations of which they are informed in effect
while on Lessor's premises.

      8.    COSTS. The Bank will pay all fees and expenses in connection with
the servicing and maintaining the ATM, except electricity. The Bank will pay all
costs in connection with the installation and operation of the required
telephone line(s). Lessor will pay all costs in connection with installation and
provision of required electricity. Lessor will allow connection to its alarm
system, if the Bank desires.

      9.    RENTAL. The Bank will pay to Lessor monthly rent based on the rental
structure described in the Reference Page. Rent is based on the monthly
transaction volume of approved surcharged cash withdrawals only. (If the Lease
Addendum does not begin on the first day of the month, rent will be prorated
during the time period beginning on the date of the operation by the Bank of the
ATM, and ending on the last day of the month after such date.)

      10.   SIGNS. The Bank has the right to display interior and exterior signs
identifying the services available at or through the ATM and to Lessor's
services. Signs will be in accordance with not less than the signage
requirements of the electronic funds transfer network (which requirements may be
amended from time to time) and at minimum will be two feet high by four feet
wide. The Bank will be solely responsible for obtaining any necessary sign
permits or for otherwise complying with other applicable laws or regulations
relating to signage. Nothing contained in this paragraph will require Lessor to
furnish space for a sign where all available space permitted by local ordinance
or laws is being utilized. Lessor will have the right to approve the design,
style and appearance of any sign prior to its installation to assure that it
will conform to Lessor's standards for the general overall appearance of the
Premises, and Lessor agrees not to unreasonably withhold or delay approval.
Lessor will cooperate with Lessee in securing permits.

      11.   TERMINATION. Either party may, upon thirty (30) days written notice,
terminate this Lease Addendum for the other party's material failure to meet its
obligations under

<PAGE>

this Lease Addendum, unless that failure is cured within the foregoing thirty
(30) day period; provided, however, that the Bank may at any time immediately
terminate all of any part of the Lease Addendum if Lessor (a) refuses to grant
the Bank or its customers access to the ATM, (b) removes ATM signage or
relocates the ATM without the Bank's written permission, or (C)) disconnects
power or telephone lines to the ATM.

      12.   OPTION TO TERMINATE. Lessor grants to the Bank the right and option
to terminate this Lease Addendum by giving advance notice to Lessor in the event
that other ATMs are located within 600 feet of the Premises, or if the
transaction volume does not average 500 transactions per month during any six
month period. In such event, the effective date of termination will be thirty
(30) days from the date Lessor receives such notice, or a date mutually agreed
upon between the parties; provided, however, that the effective date of
termination cannot fall within six (6) months of the Commencement Date.

      13.   TITLE, ACCESS AND UTILITIES. Lessor warrants that it has authority
to grant the Bank and its invitees undisturbed use of the Premises for the Term,
as well as unrestricted access to and from the ATM for purposes of maintenance,
servicing, cleaning and inspection. Lessor will provide such unrestricted access
throughout the Term. Lessor further agrees to permit the necessary lines for the
transmission of electricity and communication services be brought to the ATM.

      14.   OPERATION. All operational rights, use and control of the ATM under
this Lease Addendum will be exclusively those of the Bank. Lessor and its agents
will have only the same limited right of access to the ATM as the Bank grants to
the general public.

      15.   MAINTENANCE OF THE PREMISES. Lessor will, at its expense, maintain
the Premises in good repair, and in a clean condition at all times.

      16.   QUIET ENJOYMENT. So long as the Bank is not in default under the
terms of this Lease Addendum, the Bank's quiet enjoyment of the Space will not
be disturbed or interfered with by the Lessor.

      17.   PROPERTY. The ATM and all related equipment, furnishings and signs
are, and will remain, the personal property of the Bank.

      18.   FEES, LICENSES, TAXES. The Bank will pay all local, state and
federal fees, licenses and taxes in connection with installation, servicing,
maintenance and operation of the ATM. The Bank will hold Lessor harmless for any
of such taxes that Lessor becomes obligated to pay as a result of the Bank's
failure to pay such fees, taxes or licenses. Lessor will pay all fees, licenses
and taxes (except federal, state or local income taxes of any kin, or any taxes
related to Lessor's banking activities) levied or assessed against the Premises,
including buildings and improvements thereon, except improvements erected by the
bank or for the Bank's benefit. Lessor will hold the Bank harmless for any such
fees, licenses and taxes which the Bank becomes obligated to pay because
Lessor's failure to pay such fees, licenses and taxes.

<PAGE>

      19.   INSURANCE. The Bank will assume responsibility for all loss or
damage to the ATM unless it is due to the negligent, intentional or reckless
acts of the Lessor or its agents. The Bank will secure, pay for and maintain
insurance for the ATM, and such insurance will protect Lessor from claims which
may arise from operations under this Lease Addendum.

      20.   HOLD HARMLESS AGREEMENT. Each party agrees to defend, indemnify, and
hold the other party harmless from and against any claims, suits or demands for
injuries to or loss of life of any person or damage to properly to the extent
caused by the indemnifying party's (or its agent's) acts or omissions or breach
of this Lease Addendum. In the event of any severe claims or injury, each party
will promptly notify the other.

      21.   SERVICE MARKS. Neither party may use the service marks or name of
the other party without the prior written consent of the other party.

      22.   CONFIDENTIALITY. Lessor and the Bank will each keep confidential and
will not reveal to any other party, any of the terms or conditions of this Lease
Addendum or any of the other party's Confidential Information without the other
party's prior written consent. Confidential Information includes, but is not
limited to, a party's customer and supplier lists, products, services, processes
and business methods, and, in the case of the Bank, will include information
about the Bank's ATM operations, ATM equipment and deployment, transaction
volume and similar matters. Confidential Information may only be used to the
extent necessary to carry our the terms of this Lease Addendum, and all
Confidential Information and any related materials must be returned upon the
earlier of a party's request or the termination of this Lease Addendum. The
parties understand and agree that a breach of this provision may cause
irreparable injury and that, in the event of such breach, the injured party may,
in addition to any other remedies it may have, seek injunctive relief to enjoin
such acts. The terms of this paragraph will survive the termination or
expiration of this Lease Addendum.

      The parties agree that the Lessor may provide income and expense
information to its Lenders and appraisers or legal counsel.

      23.   COMPLIANCE WITH LAWS. The ATM will be operated in accordance with
all laws, rules and regulations. In the event that any court decision, statute,
regulation or regulatory action, or any changes in any law, ruling or regulation
or interpretation thereof, governing the operation of ATMs would, in the opinion
of counsel for the Bank, (a) make the continuation of this Lease Addendum
illegal, (b) substantially impact the economic benefit associated with operation
of the ATM, or (c) subject the Bank to any penalty, fine or regulatory action,
the Bank may terminate this Lease Addendum by provided ten (10) days written
notice to Lessor.

      24.   DESTRUCTION OR CONDEMNATION. In the event of destruction or damage
to any of the Premises, either in whole or in part, which would prevent the use
or occupancy of any of the Premises for the intended purpose of this Lease
Addendum, the Bank may terminate this Lease Addendum with ten (10) days written
notice to Lessor. In the event that any zoning or land use classification arises
and becomes effective as would in the reasonable exercise of either party's
judgement, prevent the use or occupation of any of the Premises for the intended
purpose

<PAGE>

under this Lease Addendum, then either party may terminate this Lease Addendum
by providing ten (10) day's written notice to the other party. In such an event
of termination, Lessee shall be responsible for the removal of Lessee's
equipment.

      25.   LIQUIDATED DAMAGES.

      (a)   In the event of Lessors' breach of this Lease Addendum pursuant to
Section 11 above, then at the Bank's sole option in lieu of seeking actual
damages, Lessor will pay the Bank, as liquidated damages and not as a penalty,
fifty percent (50%) of the average monthly surcharge fees which have accrued to
the Bank during the six (6) month period (or less if the Lease Addendum has been
in effect for a period of less than six (6) months) prior to Lessor's breach in
which the ATM was operating and available to cardholders, multiplied by the
number of months remaining in the then current term. If the Lease Addendum is
canceled prior to the end of one (1) full month, then the average monthly fees
for the purpose of the above formula will be calculated by dividing the amounts
already accrued to the Bank by the number of days that the ATM was operating and
available to cardholders, then multiplying that figure by thirty (30) days.
Lessor will also pay any direct expenses incurred by the Bank for
de-installation and/or removal of the ATM. The amount of liquidated damages will
not exceed $15,000.00 under any circumstance including actual, liquidated or
under penalty provisions outlined above.

      c)    Lessor agrees that the liquidated damage provisions of this Section
25 are reasonable in light of all present and predictable circumstances,
including, but not limited to, the amount of fees expected to be earned by the
Bank under this Lease Addendum. Lessor authorizes the Bank to offset any amounts
due the Bank under this Section 25 against any rents due Lessor under Section 9
above.

      26.   LIMITATION OF LIABILITY. IN NO EVENT WILL THE BANK BE LIABLE FOR ANY
INCIDENTAL, INDIRECT, REMOTE, CONSEQUENTIAL OR PUNITIVE DAMAGES, INCLUDING
WITHOUT LIMITATION, LOSS OF USE, LOSS OF PROFITS, OR LOSS OF REVENUE, HOWEVER
CAUSED, WHETHER BY THE NEGLIGENCE OF THE BANK OR OTHERWISE. THE BANK'S MAXIMUM
LIABILITY UNDER THIS LEASE ADDENDUM FOR ANY UNCURED BREACH IS AN AMOUNT EQUAL TO
ONE MONTH'S RENT, AS AVERAGED OVER THE SIX (6) MONTH PERIOD PRIOR TO THE UNCURED
BREACH.

      27.   MISCELLANEOUS.

      (a)   This Lease Addendum, including the reference page, all schedules and
exhibits, constitutes the entire agreement of the parties with respect to the
subject matter hereof, and supersedes all prior understandings or agreements,
written or oral, on this subject. This Lease Addendum may only be altered,
amended or superseded by a writing agreed to and signed by the

<PAGE>

parties.

      (b)   The language used in this Lease Addendum will be deemed to be the
language chosen by the parties to express their mutual intent, and any rule that
a contract is to be construed against the drafter will not apply to this Lease
Addendum. The section headings of this Lease Addendum are solely for convenience
and will not be considered in its interpretation. Whenever possible, each
provision of this Lease Addendum will be interpreted in such a manner as to be
effective and valued under applicable law. However, in the event that any term
or provision of this Lease Addendum is deemed to held to be invalid, illegal or
unenforceable, the remaining terms and provisions of this Lease Addendum will
nevertheless continue and be deemed to be in full force and effect.

      (c)   The relationship of the parties under this Lease Addendum is one of
independent contractors, and not one of fiduciaries. Under no circumstances will
the relationship between the parties be construed to be that of a joint venture
or partners, nor is it intended that the relationship be subject to subchapter K
of the Internal Revenue Code. No party will hold itself out as, or be deemed to
be, an employee, agent, partner or joint venturer of the other and each party's
authority will be limited to the matters expressly set forth in this Lease
Addendum.

      (d)   All disputes arising out of or relating to this Lease Addendum will
be settled by arbitration before a sold arbitrator under the then current
Commercial Arbitration Rules and, if necessary, the Rules for Emergency Orders
of protection, of the American Arbitration Association. The duty and right to
arbitrate will extend to any employee, officer, shareholder, agent or affiliate
of the parties. The arbitrator will have no authority to award damages in excess
of the limitations and exclusions set forth in this Lease Addendum, or to
otherwise grant relief inconsistent with the terms of this Lease Addendum. The
decision and award of the arbitrator will be final and binding, and the award so
rendered may be entered in any court having appropriate jurisdiction.

      (e)   This Lease Addendum will be governed by and construed in accordance
with the laws of the State of Maryland applicable to agreements made and to be
performed entirely within that State, without regard to that State's conflict of
laws provisions. The exclusive venue for any arbitration or legal proceeding
arising out of or relating to this Lease Addendum will be in Prince George's or
Charles County, Maryland, unless otherwise agreed in writing by the parties.
Each party irrevocably waives any objection that it may have at any time to this
venue.

      (f)   In the event of any arbitration or litigation between the parties
arising out of this Lease Addendum, the arbitrator and/or court will award the
prevailing party its costs and reasonable expenses and attorneys' fees resulting
from such proceedings in addition to any other relief awarded. Interest will
accrue on any disputed amounts at a rate equal to the lesser of one and one-half
percent (1.5%) per month, or the highest amount allowed by Maryland Law.

      (g)   Unless specifically provided for elsewhere in this Lease Addendum,
no party will be liable to the other party for any loss, damage, delay or
failure of performance that is attributable to acts of God, armed conflicts,
war, insurrection, acts of terrorism or acts committed

<PAGE>

 in furtherance of terrorism, riots, earthquakes, hurricanes, floods, unusually
 severe weather, conditions or events of nature that cannot be predicted, civil
 disturbances, power failure, strikes, fire, the acts of any governmental
 authority, or other causes beyond its reasonable control. A party's performance
 will be excused during the pendency of any such event, but that party will take
 all steps reasonable, practical and necessary to effect prompt resumption of
 its obligations under this Lease Addendum in full or in part.

      (h)   No failure or delay on the part of either party in exercising any
power or right under this Lease Addendum will operate as waiver, nor will any
partial exercise of any such power or right preclude any other further exercise
thereof. No waiver by either party of any provision of this Lease Addendum, or
of any branch or default, will be effective unless in writing and signed by a
party against whom such waiver is to be enforced.

      (i)   Any notice that a party wishes or is obligated to give under this
Lease Addendum must be in writing and delivered to the intended recipient by (I)
hand, (ii) United States certified mail, (iii) a nationally recognized overnight
courier (such as Federal Express), addressed to each party at the address set
forth on the Reference Page. In the case of the Bank, any such notice must be
addressed to the attention of the Bank's president and to its General Counsel.
Notices will be deemed to have been given or made three (3) Business Days after
deposit in the U.S. mail or one (1) business day after delivery to the overnight
courier service for next-day delivery. For the purposes of this Lease Addendum,
"Business Days" means Monday through Friday, excluding federal holidays.

      (j)   Lessor will not assign its rights or obligations under this Lease
Addendum without the written consent of the Bank, which will not be unreasonably
withheld. Notwithstanding the foregoing, either party has the right to assign
this Lease Addendum, or its rights hereunder, in whole or in part, without the
other party's consent, as a result of, or pursuant to, a (i) transfer to any
entity or person, directly or indirectly, controlling or under common control
with such party, and (ii) a merger or consolidation of such party, or a purchase
and assumption of such party's assets and liabilities. The terms and conditions
of this Lease Addendum will be binding upon and inure to the benefit of the
successors and assigns, as such successors and assigns are permitted by this
paragraph. The Lessor shall have the right to sell the premises without the
consent of the Lessee.

      (k)   Each party represents and warrants that it has the full power and
authority to enter into this Lease Addendum, and that this Lease Addendum
constitutes the legal, valid and binding obligation of that party. Each party
further represents and warrants that the execution and delivery of this Lease
Addendum and the consummation of the transactions contemplated by this Lease
Addendum will not conflict or result in a breach of any of the terms or
conditions of any agreement to which it is a party or by which it is bound, or
constitute a default under any such agreement. This Lease Addendum may be
executed in one or more counterparts, each of which will constitute an original
agreement, but will not be enforceable until delivery of the executed
counterparts. The parties acknowledge that this Lease Addendum may be executed
using electronic or facsimile signatures, and that each signature will be
legally binding to the same extent as an original signature. Each party waives
any legal requirement that this Lease

<PAGE>

Addendum be embodied, stored or reproduced in tangible media, and agrees that an
electronic reproduction will be given the same legal force and effect as an
original writing.

      THE SIGNATURES OF THE LESSOR AND LESSEE APPEAR ON THE REFERENCE PAGE.

<PAGE>

                                   EXHIBIT "A"

                               ATM SPECIFICATIONS

EQUIPMENT:

SPECIFICATIONS:<PAGE>

EXHIBIT 10.2

                               OPERATING AGREEMENT

                                       FOR

                      POINTER RIDGE OFFICE INVESTMENT, LLC

      THIS OPERATING AGREEMENT FOR POINTER RIDGE OFFICE INVESTMENT, LLC, A
MARYLAND LIMITED LIABILITY COMPANY (the "AGREEMENT") is made and entered into
effective for all purposes and in all respects as of this 22nd day of July, 2004
by and among J. WEBB GROUP, INC., A VIRGINIA CORPORATION, MICHAEL M. WEBB, an
individual, LUCENTE ENTERPRISES, INC., A MARYLAND CORPORATION, CHESAPEAKE CUSTOM
HOMES, L.L.C., A MARYLAND LIMITED LIABILITY COMPANY and OLD LINE BANCSHARES,
INC., A MARYLAND CORPORATION, all as Members, and CHESAPEAKE POINTER RIDGE
MANAGER, LLC, A MARYLAND LIMITED LIABILITY COMPANY, in its capacity as Manager
and not as a Member.

                              EXPLANATORY STATEMENT

      A. The Company has been formed pursuant to Articles of Organization dated
July 12, 2004, and filed with and accepted by the Maryland Department of
Assessments and Taxation on July _____ 2004.

      B. The Members now desire to organize the Company and set forth their
specific understanding and agreement with respect to the Initial and Additional
Capital Contributions of the Members, the acquisition, development,
construction, leasing and operation of the Property, the conduct of the Company,
distribution of Cash Available for Distribution, the authority of the Manager,
fees payable to the Manager and all other matters related to or concerning the
Company, the Members, the Property, the Project, and the Manager.

      NOW THEREFORE, in consideration of the foregoing, the provisions of this
Explanatory Statement (which Explanatory Statement shall be considered a
substantive part of this Agreement) and of the mutual promises of the parties
herein set forth, the Members hereby adopt this Agreement as the operating
agreement of the Company in accordance with the terms and conditions set forth
below.

                                       1
<PAGE>

1.    GENERAL

      1.01 FORMATION. The name of the Company is "POINTER RIDGE OFFICE
INVESTMENT, LLC." The Members shall take all action required by law to maintain
the Company as a limited liability company under the Uniform Act and under the
laws of all other jurisdictions in which the Company may elect to conduct
business.

      1.02 PLACE OF BUSINESS. The principal business office of the Company in
the State of Maryland shall be 6196 Oxon Hill Road, Suite 340, Oxon Hill,
Maryland 20745. The Manager may, at any time, change the location of such
principal office in which event the Manager shall give due notice to the
Members.

      1.03 REGISTERED OFFICE AND AGENT. The name of the Resident Agent of the
Company shall be Greg Wilby whose address is 12022 Steven Lane, Dunkirk,
Maryland 20754. The Resident Agent is a resident of the State of Maryland and
actually resides therein.

      1.04 RULES OF CONSTRUCTION. The following rules of construction shall
apply to this Agreement:

            (A) All section headings in this Agreement are for the convenience
of reference only and are not intended to qualify the meaning of any section.

            (B) All personal pronouns used in this Agreement, whether used in
the masculine, feminine or neuter gender, shall include all other genders, the
singular shall include the plural, and vice versa, as the context may require.

            (C) Each provision of this Agreement shall be considered severable
from the rest, and if any provision of this Agreement or its application to any
Person or circumstances shall be held invalid and contrary to any existing or
future law or unenforceable to any extent, the remainder of this Agreement and
the application of any other provision to any Person or circumstances shall not
be affected thereby and shall be interpreted and enforced to the greatest extent
permitted by law so as to give effect to the original intent of the parties
hereto.

            (D) Unless otherwise specifically and expressly limited in the
context, any reference herein to a decision, determination, act, action,
exercise of a right, power or privilege, or other procedure by a Member shall
mean and refer to the decision, determination, act, action, exercise or other
procedure by the Member in its sole and absolute discretion acting in the best
interests of such Member and not as a fiduciary for the Company or the other
Members.

                                       2
<PAGE>

            (E) All references in this Agreement to "DOLLARS" as a unit of
currency shall be deemed a reference to United States dollars and United States
currency.

            (F) Each party hereto and its counsel have reviewed this Agreement,
and the normal rule of construction that any ambiguities are to be resolved
against the drafting party shall not be applicable to the construction and
interpretation of this Agreement and the Members and the Manager agree that this
Agreement shall be construed if any construction be required in accordance with
its fair meaning and not against any party as the draftsman.

            (G) Unless explicitly stated to the contrary, the term "includes",
"including" and other expressions of inclusion shall be construed in each
instance to mean "includes without limitation", "including but not limited to"
or other phraseology denoting the non-exclusive nature of the item to which
reference is being made.

      1.05  MEMBERS AND LLC INTERESTS.

            (A) MEMBERS. The names, addresses, Percentages and Initial Capital
Contribution of the Members are as set forth on EXHIBIT 1 attached hereto and
made a part hereof.

            (B) MEMBER INTERESTS/MEMBERS. Each Member that is listed on EXHIBIT
1 hereto as a Member shall own a Membership Interest representing an ownership
interest in the Company, including the right to distributions and any other
rights set forth in this Agreement and all obligations set forth in this
Agreement. For purposes of this Agreement, a Member's Percentage of Membership
Interest shall be the most recent Percentage of Membership Interest for such
Member reflected on EXHIBIT 1, respectively, that, when aggregated with all
other Percentages of Membership Interests, totals 100%.

2.    DEFINITIONS

            The following terms have the definitions hereinafter indicated
whenever used in this Agreement with initial capital letters:

            AFFILIATE: With respect to any referenced Person, (I) such Person or
a member of his immediate family; and (II) any Person directly or indirectly
Controlling, Controlled by, or under direct common Control with the Person in
question.

            AGREEMENT: This Operating Agreement and the Exhibits attached
hereto, as the same may be amended and in effect from time to time.

                                       3
<PAGE>

            BANKRUPT(CY): Either (i) the initiation by a referenced Person of a
proceeding, or initiation of any proceeding against a referenced Person, to
liquidate or reorganize such Person which has not been vacated, discharged or
bonded within ninety (90) days of initiation, under a federal, state or local
bankruptcy or insolvency law; (ii) an assignment by a referenced Person for the
benefit of creditors; or (iii) the agreement by a referenced Person to
appointment of a receiver or trustee for all or a substantial part of his
property, or court appointment of such receiver or trustee which is not
suspended or terminated within ninety (90) days after appointment.

            BUDGET: means the pro forma operating statement of cost, income,
expenses and reserve for the Company approved from time to time by the Members
Committee. The current approved Budget is attached hereto as EXHIBIT 5. The
Manager shall have the authority to modify the Budget by adjusting individual
line items within the Budget provided that the Manager may not revise the Budget
without the approval of a Members Committee Vote if the effect of such revision
would be to reduce the net income of the Company by more than twenty five
percent (25%) from the amount shown on the then approved Budget.

            CAPITAL ACCOUNT: With respect to any Member, the Capital Account
maintained for such Member in accordance with the following provisions:

            (A) To each Member's Capital Account there shall be credited such
Member's Capital Contributions, such Member's distributive share of Profits and,
without duplication, any items in the nature of income or gain which are
specially allocated pursuant to Section 2(C) of EXHIBIT 2 hereto, and the amount
of any Company liabilities assumed in writing by such Member or which are
secured by any Company Property distributed to such Member.

            (B) To each Member's Capital Account there shall be debited the
amount of cash and the Gross Asset Value of any Company Property distributed to
such Member pursuant to any provision of this Agreement, such Member's
distributive share of Losses (as defined in EXHIBIT 2 hereto) and, without
duplication, any items in the nature of expenses or losses that are specially
allocated pursuant to Section 2(C) of EXHIBIT 2 hereto, and the amount of any
liabilities of such Member assumed in writing by the Company or which are
secured by any property contributed by such Member to the Company.

            (C) In the event any Membership Interest in the Company is
transferred in accordance with the terms of this Agreement, the transferee shall
succeed to the Capital Account of the transferor to the extent it relates to the
transferred interest in the Company.

                                       4
<PAGE>

            (D) In determining the amount of any liability for purposes of this
definition, there shall be taken into account Code Section 752(c) and any other
applicable provisions of the Code and Regulations.

            The foregoing provisions and the other provisions of this Agreement
relating to the maintenance of Capital Accounts are intended to comply with
Regulations Section 1.704-1(b), and shall be interpreted and applied in a manner
consistent with such Regulations.

            CAPITAL CONTRIBUTION: With respect to any Member, the amount of
money and the initial Gross Asset Value of any property (other than money)
contributed to the Company with respect to the Membership Interest in the
Company held by such Member. The contribution of any property other than money
to the Company which is to be included in a Member's Capital Account shall
require the consent of the Manager. The Members acknowledge that no portion of
the initial Capital Account of the Members as set forth on EXHIBIT 1 consists of
any property other than money. Each Member shall make their respective Capital
Contribution as shown on EXHIBIT 1 within ten (10) days after the Effective
Date.

            CASH AVAILABLE FOR DISTRIBUTION: means, with respect to any fiscal
period, an amount equal to the excess of (1) the gross cash revenues of the
Company from all sources (including Capital Proceeds but excluding Capital
Contributions) during such fiscal period plus such reserves that the Manager
determines are no longer necessary to provide for the foreseeable needs of the
Company, minus (2) the sum of the following: (i) all cash expenditures in
accordance with the Budget made by the Company or which the Company is obligated
to make for or during such period in connection with the operation of the
Company or in connection with the Company Property, including all fees,
commissions or other similar amounts paid to the Manager, the Members or their
Affiliates pursuant to this Agreement, operating expenses, taxes and
assessments, insurance premiums, debt service, and any fees for management
services and administrative expenses, except to the extent paid from previously
established Company reserves; and (ii) establishment or additions to the working
capital reserve of the Company and other reserves as determined by the Manager.

            CAPITAL PROCEEDS: That portion of Cash Available for Distribution
representing the net proceeds (or distributions of net proceeds, as the case may
be) from (1) any financing or refinancing by the Company of the Company Property
or any part thereof, (2) any sale, disposition, taking or loss (including the
proceeds from any eminent domain proceeding or conveyance in lieu thereof or
from casualty insurance other than rental income insurance or title insurance)
by the Company of the Company Property or any part thereof, and (3) any reserves
previously set aside from Capital Proceeds or Capital Contributions that are
deemed available for distribution to the Members. In the computation of Capital
Proceeds there shall be deducted the payment of all costs and other expenses
related thereto and any fees

                                       5
<PAGE>

due and payable to the Manager, and the satisfaction of any debt being
refinanced or discharged, in the case of a financing, refinancing, sale,
disposition, taking or loss of Company Property or any part thereof, and any
other debts or liabilities of the Company for which the Manager decides to use
the proceeds thereof to repay, and the setting aside of any reserves therefrom
as determined by the Manager.

            CHESAPEAKE: Chesapeake Pointer Ridge Manager, a Maryland limited
liability company, the Manager of the Company.

            CODE: The Internal Revenue Code of 1986 (or any corresponding
provision of succeeding law), as amended from time to time.

            COMPANY PROPERTY: At any particular time, any assets or property
(tangible or intangible, choate or inchoate, fixed or contingent) held or owned
by or for the benefit of the Company.

            CONSENT: The written or verbal consent of a Member to do the act or
thing for which the consent is required or solicited, or the act of granting
such written or verbal consent, as the context may require. Except as expressly
provided otherwise in this Agreement, reference to a requirement for the
"CONSENT" of a Member shall mean the sole and absolute discretionary decision of
such Member acting in the best interests of such Member and not as a fiduciary
for the Company or the other Members.

            CONTROL(S)(LED)(LING): As applied to a referenced Person, the
exclusive possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of that Person, whether through
ownership of voting securities, by contract, or otherwise.

            EFFECTIVE DATE: Shall be the date first set forth on page 1 hereof.

            FAMILY MEMBERS: With respect to any person, such person's spouse,
his or her parents and their spouses, his or her siblings and their spouses, his
or her children and their spouses, and his or her grandchildren or great
grandchildren and their respective spouses.

            FISCAL YEAR: The calendar year or such other twelve (12)-month
period selected by the Manager.

            GROSS ASSET VALUE: With respect to any asset, the asset's adjusted
basis for federal income tax purposes, except as follows:

            (A) The initial Gross Asset Value of any asset contributed by a
Member to the Company shall be the gross fair market value of such asset, as
agreed to by the contributing Member and the Company;

                                       6
<PAGE>

            (B) The Gross Asset Values of all Company Property shall be adjusted
to equal their respective gross fair market values, as determined by the
Manager, as of the following times: (1) the acquisition of an additional
interest in the Company by any new or existing Member in exchange for more than
a de minimis capital contribution; (2) the distribution by the Company to a
Member of more than a de minimis amount of Company Property as consideration for
an interest in the Company; and (3) the liquidation of the Company within the
meaning of Regulations Section 1.704-1(b)(2)(ii)(g); provided, however, that the
adjustments pursuant to clauses (1) and (2) above shall be made only if the
Manager has reasonably determined that such adjustments are necessary or
appropriate to reflect the relative economic interests of the Members in the
Company;

            (C) The Gross Asset Value of any Company Property distributed to any
Member shall be the gross fair market value of such asset on the date of
distribution; and

            (D) The Gross Asset Values of Company Property shall be increased
(or decreased) to reflect any adjustments to the adjusted basis of such assets
pursuant to Code Section 734(b) or Code Section 743(b), but only to the extent
that such adjustments are taken into account in determining capital accounts
pursuant to Regulations Section 1.704-1(b)(2)(iv)(m); provided, however, that
Gross Asset Values shall not be adjusted pursuant to this clause (D) to the
extent the Manager has determined that an adjustment pursuant to (B) above is
necessary or appropriate in connection with a transaction that would otherwise
result in an adjustment pursuant to this clause (D).

            If the Gross Asset Value of an asset has been determined or adjusted
pursuant to (A), (B), or (D) above, such Gross Asset Value shall thereafter be
adjusted by the Depreciation (as defined in EXHIBIT 2) taken into account with
respect to such asset for purposes of computing Profits and Losses.

            IRS: The United States Internal Revenue Service.

            MANAGER: As defined in Section 7.01(A) below.

            MAJOR DECISION: those decisions set forth in Section 7.03.

            MEMBERS COMMITTEE: the committee composed of the designated
representatives of the Members and which shall operate in accordance with the
provisions of Section 7.07.

            MEMBERS COMMITTEE VOTE: means the vote of a majority of the members
of the Members Committee which shall include the Members and the Manager.

                                       7
<PAGE>

            MEMBER LOANS: Any loans made by a Member to the Company from time to
time pursuant to Section 5.01(D)(i) hereof.

            MEMBERSHIP INTEREST: As to any Member, such Member's Percentage of
ownership of the Company and all right to distributions under Article 6 hereof,
and any other rights which such Member has in the Company under this Agreement
or the Uniform Act.

            NOTICE: A writing containing the information required by this
Agreement to be communicated to a Person and personally delivered to such Person
or sent for next business day delivery by recognized air courier capable of
giving receipt therefor, freight prepaid, to such Person at the last known
address of such Person as shown on the books of the Company, the date of
personal delivery or of the air courier's receipt, as the case may be, or the
date of refusal of acceptance of delivery being deemed the date of such Notice;
provided, however, that any written communication containing such information
actually received by a Person shall constitute Notice for all purposes of this
Agreement. Any Member may change its address or the address to which copies of
Notices should be sent by Notice to the other Members.

            PERCENTAGE OF MEMBERSHIP INTEREST: As to any Member, the percentage
interest in the Company shown opposite the name of such Member on EXHIBIT 1
attached hereto, as amended from time to time.

            PERSON: Any individual, partnership, limited liability company,
corporation, trust or other entity.

            PROPERTY: the real property owned by the Company and set forth and
described on EXHIBIT 4. The term "PROPERTY" shall also include any other real
property necessary or required to the construction and operation of the Project.
The Company shall not own any other real property other than the Property.

            PROJECT: the Property and the construction thereon of a commercial
office building containing approximately 40,000 square feet of which
approximately 38,000 square feet shall be net rentable and all other
improvements necessary or required to the use, occupancy and operation of the
Project. The final building configuration and gross square footage shall be
determined by the Manager.

            REGULATIONS: The Income Tax Regulations, including Temporary
Regulations, promulgated under the Code, as such regulations may be amended from
time to time (including corresponding provisions of succeeding regulations).

            SUBSTITUTED MEMBER: Any Person who is admitted to the Company as an
additional or substitute Member pursuant to Article 9. A Substituted Member,

                                       8
<PAGE>

upon his admission as such, shall succeed to the rights, privileges and
liabilities of his predecessor in interest as a Member.

            TAX MATTERS MEMBER: J. Webb Group, Inc., a Virginia corporation.

            TRANSFER: Any sale, assignment, transfer, gift, bequest, succession
through intestacy, contribution, distribution, conveyance, pledge,
hypothecation, mortgage, exchange or other disposition, or other encumbrance
whether voluntary, involuntary or by operation of law and, in the case of a
Member, whether directly or indirectly by transfer or sale or issuance of stock,
transfer or sale of partnership or limited liability company interest, admission
of new partners, sale or transfer of other legal or beneficial interests or
assets, or by consolidation or merger, any sale, transfer or other disposition
which results, directly or indirectly, in a change of Control or beneficial
ownership of such Member.

            UNIFORM ACT: the Maryland Revised Uniform Limited Liability Company
Act as of the date hereof, as amended from time to time.

3.    BUSINESS; AUTHORIZED ACTIVITIES

      3.01 BUSINESS. The business and purpose of the Company shall be to (i)
acquire, own, hold for profit, sell, assign, transfer, operate, lease, develop,
mortgage, refinance, pledge and otherwise deal with the Property and the Project
pursuant to and in accordance with this Agreement and (ii) to do all other acts
and things as may be necessary, desirable, expedient, convenient for or
incidental to, the furtherance and accomplishment of the foregoing objectives
and purposes and for the protection and benefit of the Company. The Company
shall not engage in any other business without the unanimous consent of all of
the Members.

      3.02 AUTHORIZED ACTIVITIES. In carrying out the purposes and business of
the Company, but subject to all other provisions of this Agreement, the Manager
is authorized to cause the Company to:

            (A) Enter into and perform all acts and carry out all obligations
under all contracts and agreements necessary or incidental to the accomplishment
of the purposes and business of the Company, as set forth in Section 3.01 above;

            (B) Operate, maintain, finance, improve, repair, alter, buy,
acquire, own, sell, convey, assign, mortgage or lease the Property and any
personal property as reasonably necessary to the accomplishment of the purposes
and business of the Company;

            (C) Borrow money and issue evidences of indebtedness from Persons in
furtherance of any or all of the purposes and business of the Company (which
Persons may include Persons holding a direct or indirect ownership interest in
any Member and Affiliates of any Member, provided the Manager Consents to such

                                       9
<PAGE>

borrowings), and to secure the same by mortgage, pledge or other lien on Company
Property or any portion thereof;

            (D) Employ Persons in the operation and management of the business
of the Company, including, without limitation, attorneys, accountants, mortgage
bankers, management and leasing agents, insurance brokers, real estate brokers,
mortgage brokers, engineers, architects, contractors and consultants, which
Persons may include the Manager, and Members and Affiliates of Members,
provided, however, that the fees and terms of such employment are competitive to
those available from unrelated Persons;

            (E) Employ one or more contractors to construct the Project provided
the cost of same shall be in accordance with the Budget;

            (F) Hold title to all Company Property;

            (G) Bring, defend, pay, extend, renew, modify, adjust, submit to
arbitration, prosecute or compromise any obligation, suit, liability, cause of
action or claim with respect to the Company or the Company Property; and

            (H) Engage in any kind of lawful activity, and perform and carry out
contracts of any kind, necessary or advisable in connection with the
accomplishment of the purposes and business of the Company.

4.    REPRESENTATIONS AND WARRANTIES

      4.01 REPRESENTATIONS AND WARRANTIES. In addition to any representations
and warranties contained elsewhere in this Agreement:

            (A) the Manager represents and warrants to the Company and the other
Members that it is a limited liability company validly existing and in good
standing under the laws of the State of Maryland, and has the full power and
authority to carry out the business now conducted by it and to enter into and
carry out the terms of this Agreement; and the Persons executing this Agreement
on its behalf have full power and authority and legal right to bind the Manager
to this Agreement.

            (B) Each Member represents and warrants to the Company and the other
Members that it is validly existing and in good standing under the laws of their
respective state of organization, and has the full power and authority to carry
out the business now conducted by it and to enter into and carry out the terms
of this Agreement; and the Persons executing this Agreement on its behalf have
full power and authority and legal right to bind it to this Agreement.

            (C) Each Member hereby represents and warrants to the Company and to
the other Members that, as of the date hereof, except as otherwise set forth

                                       10
<PAGE>

in this Agreement, the execution and performance of this Agreement by such
Member does not violate the terms of any material agreement to which it is a
party or by which it is bound.

      4.02 ACTION FOR BREACH. The representations, warranties and covenants in
Section 4.01 are being made by each Member in consideration for its undertakings
and rights under this Agreement. Upon the breach of any such representation,
warranty or covenant contained in Section 4.01, any other Member or the Company
may pursue any available legal or equitable remedy against such Member without
being required to dissolve the Company and notwithstanding the availability of
any other remedy.

5.    CAPITAL ACCOUNTS

      5.01  CAPITAL CONTRIBUTIONS/MEMBER LOANS.

            (A) In consideration for its Membership Interest, each of the
Members is making (or has previously made) certain initial Capital Contributions
as set forth on EXHIBIT 1 attached hereto (the "INITIAL CAPITAL CONTRIBUTIONS").

            (B) In addition to the Initial Capital set forth above, the Members
acknowledge that a variety of circumstances may arise under which the Company
may require funds to, among other things, pay unanticipated financing expenses
and/or operating deficits of the Company, or pay other expenses of the Company,
or establish Company reserves, where no financing provides for such funding,
including operating deficits resulting from deficiencies between the Company's
operating income and operating expenses (including debt service) (referenced to
collectively as "CASH DEFICITS").

            (C) If the Company requires funding from its Members for payment of
Cash Deficits, as determined by the Manager, and if sufficient reserves therefor
and Cash Available for Distribution are not available (the amount of any such
deficiency being hereinafter referred as "CASH SHORTFALLS"), the Members shall
contribute capital in the amount of each of the Cash Shortfalls in accordance
with their respective Percentages of Membership Interest (a "MEMBER CAPITAL
CONTRIBUTION") unless the Manager agrees to cause the Company to borrow
additional funds for the purpose of funding any Cash Shortfall in lieu of a
Member Capital Contribution; provided, however, that in the event a Member fails
to make its Member Capital Contribution, such Member shall be liable only as
provided in Section 5.01(E) below and otherwise such contribution obligations
shall be non-recourse to the Members. The Manager shall notify the Members of
the Member Capital Contribution, giving each Member at least fifteen (15) days
prior notice of the due date of same (the "DUE DATE").

                                       11
<PAGE>

            (D)

                  (i) If the Manager does not agree to cause the Company to
borrow funds for the purpose of funding such Cash Deficits and/or Cash
Shortfalls, and if any Member fails to make a Member Capital Contribution on the
Due Date (a "NONCONTRIBUTING MEMBER"), any other Member who has made its Member
Capital Contribution (a "CONTRIBUTING MEMBER") may, without Consent of the other
Members, and subject to the conditions of this Section 5.01, make a loan to the
Noncontributing Member (the proceeds of which shall be paid to the Company as a
contribution by the Noncontributing Member) for all or part of the amount of the
Member Capital Contribution not made by the Noncontributing Member (a "MEMBER
LOAN"). To the extent more than one Member wishes to loan funds in the amount
not contributed by a Noncontributing Member in accordance with this Section,
each Contributing Member may lend funds in the proportion which its Percentage
of Membership Interest bears to the aggregate Percentage of Membership Interests
of all such Contributing Members, or as otherwise agreed by such Contributing
Members. Such Member Loan (or Member Loans) shall be secured by the
Noncontributing Member's interest in the Company (or pro-rata portion thereof in
the event there is more than one Contributing Member). The Company, in such
circumstances, shall use the first distributions otherwise payable or
distributable to such Noncontributing Member (or such Defaulting Member if such
Member Loan is made pursuant to Section 5.01(B) above) pursuant to Section 6
hereof to repay any such Member Loan, which distributions shall be used first to
pay any and all accrued and unpaid interest due under such Member Loan on a pro
rata basis based on the amount of interest owing on all Member Loans to such
Noncontributing Member until all accrued and unpaid interest is paid with
respect to all Member Loans made to such Noncontributing Member, then to repay
the principal balances outstanding thereunder pro rata as to all Member Loans
made to such Member in accordance with the amount of principal due each Member
making such Member Loans; provided, however, that Member Loans made to a Member
pursuant to Section 5.01(B) shall be repaid after the repayment of all Member
Loans made to such Member under this subparagraph (i). Such Member Loan shall be
non-recourse (except with respect to such Noncontributing Member's Membership
Interest) and shall bear interest at a rate equal to twenty percent (20%) per
annum (the "MEMBER LOAN RATE").

                  (ii) In the event no Contributing Members elect to make a
Member Loan to the Noncontributing Member as provided above, the Manager, at its
sole election, shall have the right to (A) rescind the request for Member
Capital Contributions and return to each Contributing Member its respective
Member Capital Contribution, or (B) reduce the requested Member Capital
Contribution to the amount equal to the sum of the Member Capital Contributions
received by the Company in which event the Contributing Members shall be deemed
to have made Member Loans to such Noncontributing Members as provided above to
the extent that each Contributing Member's payment exceeds the amount which
would be

                                       12
<PAGE>

required of such Contributing Member based on the reduced Member Capital
Contribution; provided, however, in the event the Contributing Members do not
make a Member Loan which aggregate the total of the Non-Contributing Member's
Capital Contribution, then each Contributing Member shall have the right to
cause the Company to return such Contributing Members' Capital Contribution.

                  (iii) Any Contributing Member making a Member Loan pursuant to
this Section shall have the right, which may be exercised any time after
providing thirty (30) days prior written notice thereof to the Manager and to
the Non-Contributing Member to which the Member Loan has been made (and provided
such Member Loan has not been repaid in full on or prior to the end of such
thirty (30) day period), to convert the then outstanding principal balance of
its Member Loan to a Member Capital Contribution as provided below. In such
event, the Member making such conversion under this paragraph shall be entitled
to any interest that accrued on its Member Loan prior to the date of such
conversion which shall be repaid as set forth above. Upon such conversion, the
Percentage of Membership Interest of the Noncontributing Member shall
immediately be reduced in an amount equal to the percentage obtained by dividing
(A) the principal amount of the Member Loan(s) being converted by (B) the
aggregate amount of all Capital Contributions required to have been made as of
the date of such calculation by all of the Members, including the subject Member
Capital Contributions.

                  (iv) As an example, assume (A) that Member X's Percentage of
Membership Interest is 10% and that Member X has made an Initial Capital
Contribution of $10,000, (B) that Member Y's Percentage of Membership Interest
is 90%, and that Member Y has made an Initial Capital Contribution of $90,000,
(C) that a (first ever) call is made for additional capital in the amount of
$20,000, (D) that Member X is obligated to advance 10% of such additional
capital (i.e., $2,000), (E) that Member X does not make any portion of its
required additional capital contribution, and (F) that Member Y makes the Member
Capital Contribution of Member X. The dilution of the Noncontributing Member's
(Member X's) Percentage of Membership Interest, expressed as a percentage, would
equal $2,000/$120,000, or 1.667%. Accordingly, Member X's Percentage of
Membership Interest would be reduced from 10.00% to 8.333%.

                  (v) Any reduction in the Percentage of Membership Interest of
the Noncontributing Member under this Section shall be reflected in an
immediate, simultaneous increase in the Percentage of Membership Interest of the
Contributing Members making such conversion pro rata based on the dollar amount
of such Member Loans converted. Any adjustments of Percentage of Membership
Interest pursuant to this Section shall be automatic and without the necessity
of any further action by any Member. Notwithstanding the foregoing, each Member
authorizes the Manager, acting on its behalf, to execute such documents and take
such additional actions as may be necessary to effectuate or evidence such

                                       13
<PAGE>

adjustments, including the attachment to this Agreement of a revised EXHIBIT 1
which reflects such revised Percentage of Membership Interests.

            (E) Except as specifically set forth in this Agreement, no Member
shall be required, under any circumstance, to make a Member Loan or contribute
to the capital of the Company any amount beyond that sum which the Member has
already contributed to the Company as described in Section 5.01(A) of this
Agreement and the amount to be contributed in Section 5.01(B) of this Agreement.
No Member shall be required or permitted to make any loans to the Company (other
than such loans as receive the Consent of the Manager and Member Loans described
in Section 5.01).

            (F) No interest shall accrue or be payable to any Member by reason
of any Capital Contribution or Capital Account.

            (G) Except as provided in Section 5.01(D), no Member Loans or
Capital Contributions made by any Member to the Company shall increase or
decrease any Member's Membership Interest.

      5.02 NO THIRD PARTY BENEFICIARIES. The provisions of this Agreement are
not intended to be for the benefit of any creditor, tenant or occupant of the
Project or other Person (other than a Member in its capacity as a Member) to
whom any debts, liabilities or obligations are owed by (or who otherwise has any
claim against) the Company or any of the Members; and no such creditor, tenant
or occupant of the Project or other Person shall obtain any right under any such
foregoing provision against the Company or any of the Members by reason of any
debt, liability or obligation (or otherwise).

      5.03 RETURN OF CAPITAL ACCOUNT. Except as otherwise specifically provided
in this Agreement, (i) no Member shall have any right to withdraw its Capital
Contributions or Capital Account, or to demand and receive property other than
cash from the Company in return for its Capital Contributions or Capital
Account, (ii) no Member shall have any priority over any other Members as to the
return of its Capital Contributions or Capital Account, and (iii) any return of
Capital Contributions or Capital Accounts to the Members shall be solely from
the Company Property, and no Member shall be personally liable for any such
return.

      5.04 LIMITED LIABILITY. No Member shall be liable for losses, costs,
expenses, liabilities or obligations of the Company in excess of its Capital
Contribution required under this Agreement.

6.    ALLOCATIONS AND DISTRIBUTIONS

      This Article 6 is intended to address the allocation of profits and losses
of the Company.

                                       14
<PAGE>

      6.01 ALLOCATIONS. The profits of the Company shall be shared and the
losses of the Company shall be borne by the Members as provided in EXHIBIT 2
hereto.

      6.02 DISTRIBUTIONS. Distributions of Cash Available for Distribution shall
be made to the Members pro rata in accordance with their respective Percentages.

      6.03 TRANSFERS DURING FISCAL YEAR. In the event of a transfer of all or
any part of a Membership Interest (in accordance with the provisions of this
Agreement) during a Fiscal Year, the share of income, profits, gains, losses,
deductions and credits attributable to such Membership Interest shall be
allocated among the holders of the transferred Membership Interest based on the
actual attributions to such Membership Interest for any whole months that each
such holder was recognized as the owner of the Membership Interest. For any
partial month, the share of income, profits, gains, losses, deductions and
credits attributable to such Interest shall be allocated among the holders of
the transferred Membership Interest, in proportion to the number of days that
each such holder was recognized as the owner of the Membership Interest during
such partial month without regard to the results of Company operations during
the period of such partial month in which each such holder was recognized as the
owner of such Membership Interest, and without regard to the date, amount or
recipient of any distributions which may have been made with respect to such
Membership Interest during such partial month.

      6.04 ALLOCATION OF DISTRIBUTIONS. Except as expressly provided otherwise
in this Agreement, distributions shall be made to the Members of record on the
date established by the Members for the distribution, without regard to the
length of time such Persons have been Members.

      6.05 TAXES WITHHELD. For purposes of this Agreement, any amount of taxes
required by the Code or by any State or other taxing authority to be withheld by
the Company with respect to any amount distributable by the Company to any
Member shall, upon payment to the IRS or by any such State or other taxing
authority, be deemed to be a distribution of such payment to such Member and
shall reduce the amount otherwise distributable to such Member pursuant to this
Agreement.

7.    MANAGEMENT

      This Article 7 is intended to address the management of the business
affairs of the Company.

      7.01 MANAGEMENT AND CONTROL OF COMPANY BUSINESS. Except as specifically
provided to the contrary in this Agreement, the Manager shall have full,
exclusive and complete power, authority and discretion to make all decisions
affecting the business and affairs of the Company with respect to the Company
Property and to take all such actions necessary or appropriate to accomplish the
purposes of the Company with respect to the Company Property, respectively.
Chesapeake shall be

                                       15
<PAGE>

the "MANAGER" of the Company and shall be responsible for managing the
day-to-day affairs of the Company with respect to all matters and to execute, on
behalf of the Company any agreements, contracts, documents and instruments which
may be necessary or desirable in connection with the development, management,
maintenance and operation of the business of the Company, including, without
limitation, any and all deeds, contracts, leases, mortgages, deeds of trust,
promissory notes, security agreements, financing statements, construction
contracts, architectural or other professional service agreements, plats,
development agreements with applicable governmental authorities, permit
applications, easements, declarations and other documents pertaining to the
Project, and/or any Company Property without obtaining the Consent of the other
Members.

      7.02  CERTAIN OBLIGATIONS OF MANAGER.

            (A) GENERALLY. The Manager shall use its reasonable business
judgment in connection with its duties hereunder and shall make its personnel
and the personnel of its Affiliates available to the Company to the extent
necessary in order that its obligations with respect to the Company may be
adequately discharged.

            (B) PROJECT ADMINISTRATION. Without limitation of the foregoing or
other provisions of this Section 7.02, Manager shall, at all times, exercise
good faith and shall use commercially reasonable efforts to promote and protect
the interests of the Project, the Company Property and the Company (without
consideration being made to the separate interests of any particular Member,
including the effect of any action or omission upon the distributions provided
for in Article 6), and Manager shall perform or cause to be performed the
following duties and obligations in relation to the Company:

                  (i) Negotiation with governmental authorities to obtain on
behalf of the Company any agreements, governmental approvals, building permits
and other permits and licenses as are necessary for the Project; and the direct
supervision and coordination with "Independent Contractors" (as defined below)
in connection with the satisfaction thereof and compliance therewith.

                  (ii) The engagement on behalf of the Company of the necessary
or appropriate personnel and consultants, including architects, engineers,
general contractors, subcontractors, material suppliers, consultants, attorneys,
title companies, escrow companies, property managers, brokers and marketing
agents necessary for the Project and provided for in the Budget (collectively,
"INDEPENDENT CONTRACTORS"), and the direct supervision and coordination of the
services of such Independent Contractors in connection with the operation,
redevelopment and/or completion of the Project.

                                       16
<PAGE>

                  (iii) Direct coordination with and supervision of all
Independent Contractors in connection with all litigation and other legal
matters, and the preparation of all legal documentation, including sale
contracts, and all other necessary or appropriate documents and instruments.

                  (iv) Payment or contesting of all real and personal property
taxes and assessments for the Property.

                  (v) Notification of the Members of any material adverse claim
or dispute or any actual or threatened material litigation (or condemnation or
eminent domain proceeding or action) against the Company, the Project or any
Member of which Manager becomes aware; provided, however, that with respect to
any litigation that involves only Manager and is not related to the Project,
Manager shall be obligated to notify the Company of such matter only if said
matter involves an amount in excess of $20,000 or could have an adverse material
impact on Manager.

                  (vi) Coordination with and supervision of all leasing agents
in the preparation and implementation of marketing plans and promotional
activities and leasing programs for the leasing and sale of the Company
Property.

                  (vii) The use of commercially reasonable efforts to prevent
any mechanic's or materialmen's liens to be filed by any Independent Contractor
against the Company Property, or any portion of either, in connection with
Manager's duties and obligations under this Agreement, or against any monies due
or to become due on account of, arising out of or relating to the Company
Property or the Project. If any such lien is filed, Manager shall promptly take
such action as Manager reasonably determines to be necessary to protect the
Company Property.

                  (viii) The use of commercially reasonable efforts to comply
with all laws in connection with the performance of Manager's duties and
obligations under this Agreement.

      7.03  MAJOR DECISIONS.

            (A) Notwithstanding the provisions of Sections 7.01 and 7.02, prior
to causing the Company to take action with respect to the following matters
(individually, a "MAJOR DECISION" and collectively, the "MAJOR DECISIONS"), the
Manager shall obtain a Members Committee Vote:

                  (i) Modifying the then current approved Budget the result of
which shall reduce the net operating income of the Company by more than ten
percent (10%);

                  (ii) Entering into a contract for (a) the sale or exchange of
all or any substantial part of the Company Property, (b) the contribution of all
or any

                                       17
<PAGE>

substantial part of the Company Property to a real estate investment trust (or
related master or umbrella limited partnership), (c) the contribution of all or
any substantial part of the Company Property to a joint venture with an
institutional investor, or (d) any other disposition of all or any substantial
part of the Company Property

                  (iii) Obligating the Company or any Member as a surety,
guarantor or accommodation party to any obligation of other than the Company;

                  (iv) Merging or consolidating the Company with any other
limited liability company, partnership or other entity;

                  (v) Approving any agreement, or material modification of any
agreement, between the Company, on the one hand, and any Affiliate of any
Member, on the other hand;

                  (vi) Paying any fees by the Company to any Affiliate of any
Member unless pursuant to an agreement with such Affiliate entered into in
accordance with the provisions hereof;

                  (vii) Using the name or credit of the Company, or any Company
Property, for any purpose other than a proper Company purpose;

                  (viii) Acting in contravention of this Agreement

                  (ix) Initiating or settling any litigation involving or on
behalf of the Company where the claim exceeds TEN THOUSAND DOLLARS ($10,000);

                  (x) Initiating a Bankruptcy with respect to the Company;

                  (xi) Modifying or amending this Agreement or the Articles
except as expressly permitted under the terms of this Agreement;

                  (xii) Extending the term of the Company;

                  (xiii) Admitting a Person as a Member of the Company;

                  (xiv) Confessing judgment against the Company and make
elections as to choice of law and venue provided, however, that the Manager
shall have complete authority to confess judgment against the Company and make
elections as to choices of law in any acquisition, development and construction
loans (including refinancings thereof) and permanent financing to be executed by
the Manager on behalf of the Company if such financing is secured by a first
lien on the Project;

                                       18
<PAGE>

                  (xv) Changing the purpose of the Company or expanding the
business of the Company beyond those activities specifically authorized in this
Agreement;

                  (xvi) Causing the Company to invest in or become a member of
any other limited partnership, limited liability company or other entity;

                  (xvii) Dissolving the Company other than expressly authorized
under the terms of this Agreement;

            (B) It is expressly agreed that with a Members Committee Vote, the
Manager shall have complete authority to make all decisions and take all actions
for, in the name, and on behalf of the Company with respect to all of the
foregoing matters set forth in this Section 7.03.

      7.04 OTHER BUSINESS VENTURES. Any Member and the Manager may engage
independently or with others in other business ventures of every nature and
description, including the ownership, operation, management, syndication and
development of real estate; neither the Company, nor any of the other Members as
a result of their being Members in or the Manager of the Company, shall have any
rights in and to such independent ventures or the income or profits derived
therefrom.

      7.05 RELIANCE ON MANAGER. No financial institution or any Person dealing
with the Manager shall be required to ascertain whether the Manager is acting in
accordance with this Agreement, but rather such financial institution or Person
shall be protected in relying solely upon the contract, deed, mortgage, deed of
trust, note, transfer or assurance of and the execution of such instrument or
instruments by the Manager. No Member shall have any right of rescission as to
any contract, deed, mortgage, note, lease, encumbrance, or any and all other
conveyances or documents in any manner executed by the Manager in accordance
with this Agreement.

      7.06 NOTICES. The Manager shall give such notices, reports and advice to
the Members with respect to the Company Property, as may, from time to time, be
required or be advisable.

      7.07 MEMBERS COMMITTEE; COMPOSITION, VOTING, AUTHORITY AND MEETINGS.

            (A) The Members Committee shall be composed of the designated
representatives of the Members. Each Member shall appoint one (1) designated
representative to serve on its behalf on the Members Committee. Each designated
representative of a Member shall have the same number of votes on any matter
coming before the Members Committee as the Percentage of the Member they
represent.

                                       19
<PAGE>

            (B) The Members Committee shall be charged with the responsibility
and authority to make all Major Decisions of the Company. The Members Committee
shall not, however, participate in the day to day management of the Company or
exercise the authority delegated to the Manager set forth in this Agreement.

            (C) Approval of any action or any decision of the Members Committee
shall require a Members Committee Vote.

            (D) The Members Committee shall meet and confer whenever a Major
Decision is required of the Company. The Manager shall also attend such
meetings. The Members Committee may otherwise conduct its business in any other
manner its members deem convenient or advisable, including conducting meetings
by telephone conference or in writing. Each meeting, action, approval and
Members Committee Vote of the Members Committee shall be duly documented in
written minutes, signed by the members, a copy of which shall be distributed to
each Members Committee Member.

            (E) No member of the Members Committee shall be paid any salary or
compensation for serving as member of the Members Committee. Each member of the
Members Committee shall, however, be fully and entirely reimbursed by the
Company for any and all out-of-pocket costs and expenses incurred by such member
(or the Member appointing such member), including reasonable travel expenses,
all to the extent set forth and reserved for in the Budget.

            (F) The Members Committee and each Member and designated
representative of a Member and the Affiliates and shareholders, officers,
employees and directors of such Members are hereby indemnified by the Company
for any act performed within the scope of the authority conferred by this
Agreement (and the costs incurred by them in connection with the defense or
settlement of any action, suit or proceeding brought or threatened resulting
from any act performed within the scope of the authority conferred by this
Agreement). Any indemnity under this Section shall be provided out of and to the
extent of Company assets only, and no Member shall have any personal liability
on account thereof.

            (G) The Members Committee and each Members Committee member, as well
as the Member appointing such Members Committee member and the Affiliates and
shareholders, officers, employees and directors of such Members shall not be
liable to the Company or the Members for, or as a result of, any act, omission
or error in judgment which was taken, omitted or made by them, in the exercise
of its judgment in good faith under this Agreement. The Members Committee and
its members may consult with such legal or other professional counsel as it or
they may select. Any action taken or omitted by it in good faith reliance on,
and in accordance with, the opinion or advice of such counsel shall be

                                       20
<PAGE>

full protection and justification to it with respect to the action taken or
omitted. The Members Committee and each Members Committee member, as well as the
Member appointing such Members Committee member and the Affiliates and
shareholders, officers, employees and directors of such Members shall not have
any liability, as a guarantor or otherwise, to the Members resulting from the
failure of the Company to have sufficient Cash Available for Distribution to
fund any or all of the distributions to the Members, and upon dissolution, the
Members shall look solely to the assets of the Company for the repayment
thereof.

      7.08  LIMITATIONS ON MEMBERS.

            (A) No Member shall have any authority to perform (I) any act in
violation of any applicable law or regulation thereunder, or (II) any act
without any Consent or ratification which is required to be Consented to or
ratified by the Members pursuant to this Agreement.

            (B) No action shall be taken by a Member if it would cause the
Company to be classified as an association taxable as a corporation for federal
income tax purposes.

      7.09  LIABILITY FOR ACTS AND OMISSIONS.

            (A) No Member, nor its officers, directors, employees and agents
(together, the "INDEMNIFIED PARTIES"), shall be liable, responsible or
accountable in damages or otherwise to the Company or any of the Members for any
act or omission performed or omitted in good faith on behalf of the Company
which any Indemnified Party reasonably believed to be within the scope of the
authority granted by this Agreement and in the best interests of the Company,
provided such act or omission is in good faith and with such care as an
ordinarily prudent person in a like position would use under similar
circumstances. The Indemnified Parties shall nevertheless be liable, responsible
or accountable for actual fraud, gross negligence or intentional misconduct.

            (B) Subject to Section 7.09(D) below, the Company shall indemnify
and make advances for expenses to the Indemnified Parties to the fullest extent
permitted under the Uniform Act (to the extent of available assets, but without
the requirement that any Member make additional Capital Contributions or Member
Loans for this purpose) against any loss or damage incurred by the Indemnified
Parties by reason of any act or omission performed or omitted by any Indemnified
Party which is consistent with the first sentence of Section 7.09(A) above.

            (C) Each Member shall indemnify and hold harmless the Company and
the other Members against any damage or loss incurred by the Company or such
Members by reason of such Member's fraud, gross negligence or intentional
misconduct with respect to the Company and/or any Company Property.

                                       21
<PAGE>

            (D) Each Member acknowledges that the assets of the Company
available to satisfy the indemnity of the Company set forth in Section 7.09(B)
shall be limited to the Company Property.

      7.10 RESPONSE TIME. Except as otherwise expressly provided in Article 10
hereof, the Members shall provide all approvals, disapprovals, Consents and
other information and cooperation required in this Agreement or otherwise
requested from time to time within five (5) business days after receipt of
written request therefor, except for proposals to sell or refinance all or
substantially all of the Company Property, as to which the response time shall
be ten (10) business days. If any Member shall fail to respond within the period
described herein, the matter in question shall be deemed to have been approved
as proposed. Such written request shall state the date by which the Member must
respond, and a statement that a failure to respond by such date will result in a
deemed approval of the request.

      7.11 COMPENSATION.

            (A) No Member shall be paid any salary, fee or other compensation
for serving as a Member or on the Members Committee. The fact that a Member or a
member of any Member's family, or an officer, director, shareholder, partner or
employee of any Member, is employed by, or is directly interested in or
connected with any Person employed by the Company, included but not limited to
the Manager, to render or perform any service, or from whom or which the Company
may buy merchandise or other property, shall not prohibit the Company from so
dealing with such Person, so long as the costs, expenses, fees or other payment
or compensation for, and the terms of any agreement (including any amendments
thereto) relating to, such services, merchandise or property are reasonable, on
arms' length terms and at competitive rates.

            (B) The Members hereby expressly agree that the Company shall pay to
the Manager (or its designated Affiliates) those fees set forth and described on
EXHIBIT 3. The Members agree that the fees to be paid to the Manager, or
Affiliates thereof, described on EXHIBIT 3 are reasonable and are at competitive
rates.

      7.12 REMOVAL OF MANAGER; APPOINTMENT OF NEW MANAGER. In the event that (i)
a Manager shall have its legal existence annulled, revoked, or forfeited, and is
not reinstated within sixty (60) days; (ii) a Manager shall file voluntary
Articles of Dissolution; (iii) a petition in bankruptcy is filed by or against a
Manager which petition is not discharged within one hundred twenty (120) days of
such filing; (iv) a proceeding is commenced by or against a Manager under any
insolvency law which proceeding is not discharged within one hundred twenty
(120) days of such commencement or (v) if the Manager has committed a material
breach of this Agreement which is not cured within thirty (30) days after notice
from any Member, then in any of such events, such Manager shall immediately and
automatically be terminated as the Manager and such Manager shall have no
further authority to act as Manager or otherwise for the Company. In the event
the Company shall no

                                       22
<PAGE>

longer have a Manager, the Members shall have the right to appoint or retain a
new Person to perform the functions of Manager.

      8.    ADMINISTRATION

      8.01 BOOKS AND RECORDS. The Manager on behalf of the Company shall
maintain or shall cause to be maintained full and accurate books of the Company
showing all receipts and expenditures, assets and liabilities, profits and
losses, names and current addresses of Members, and all other records necessary
for recording the Company's business and affairs. All Members and their duly
authorized representatives shall have the right to inspect and copy any or all
of the books and records of the Company, including books and records necessary
to enable a Member to defend any tax audit or related proceeding, and shall
have, on demand, true and full information of all matters affecting the Company.

      8.02 ANNUAL AUDIT AND TAX MATTERS.

            (A) The Manager shall maintain physical possession of the books and
records of the Company. The books and records of the Company shall be kept on
the cash basis or such other accounting method selected by the Manager. Upon the
request of and at the expense of any requesting Member, the books and records of
the Company will be audited, but not more frequently than annually.
Notwithstanding the foregoing, in the event that the results of the audit vary
by more than five percent (5%) from the books and records presented by the
Company, the Company shall pay the cost of the audit.

            (B) An accounting firm selected by the Tax Matters Member shall
prepare all tax returns required of the Company at the Company's expense. The
Tax Matters Member shall act as the tax matters partner within the meaning of
Code Section 6231(a)7 and shall give prompt Notice to each Member of any and all
notices it receives from the IRS concerning the Company, including without
limitation any notice of audit, any notice of action with respect to a revenue
agent's report, any notice of a thirty (30)-day appeal letter and any notice of
a deficiency in tax concerning the Company's federal tax return, and will
furnish each Member with status reports regarding any negotiation between the
IRS and the Company.

      8.03 REPORTS AND NOTICES. The Company will prepare or cause to be prepared
and distributed to the Members by January 30 of each calendar year, or as soon
thereafter as circumstances permit, for each of the Company: (i) IRS Form 1065
and Schedule K-1, or similar forms as may be required by the IRS, stating each
Member's allocable share of income, gain, loss, deduction or credit for the
prior Fiscal Year, and (ii) a balance sheet and the related statements of
income, cash flow, Members' capital and changes in financial position for the
previous year, prepared on a cash basis.

                                       23
<PAGE>

      8.04 COMPANY FUNDS. The funds of the Company shall not be commingled with
the funds of any other Person, and Company funds shall be used solely for the
benefit of the Company. All funds of the Company not otherwise invested shall be
deposited in one of more accounts maintained in such banking institutions as the
Manager shall determine, and withdrawals shall be made only in the regular
course of Company business on such signatures as the Manager may, from time to
time, determine.

9.    TRANSFERS

      9.01  TRANSFERS BY MEMBERS.

            Except for a Transfer pursuant to Article 10, no Member may Transfer
all or any portion of its Membership Interest in the Company to any Person,
other than pursuant to a Permitted Transfer (as hereinafter defined), without
the Consent of the Manager. Any purported Transfer in violation of the terms of
this Section 9.01 shall be void ab initio.

      9.02  ADDITIONAL OR SUBSTITUTED MEMBER.

            (A) A Person will be admitted to the Company as an additional or
Substituted Member if, and only if, the following conditions are satisfied:

                  (1) The admission of such Person (i) shall have been Consented
to by th e Manager, or (ii) the Person shall have received its interest in a
Permitted Transfer and provided all relevant evidence of such fact to the
Manager;

                  (2) The Person shall have accepted and agreed to be bound by
all the terms and provisions of this Agreement by executing a counterpart
thereof and such other documents or instruments as may be required or
appropriate in order to effect the admission of such Person as a Member;

                  (3) The assignor and assignee shall pay all costs and fees
incurred by the Company to effect the transfer and substitution;

                  (4) Such admission will not cause a violation of Section 9.05
of this Agreement; and

                  (5) The assignor and assignee file a Notice or other evidence
of transfer and such other information reasonably required by the
non-Transferring Members, including, without limitation, names, addresses and
telephone numbers of the assignor and assignee.

            (B) Unless named in this Agreement, or unless admitted to the
Company as a Substituted Member as provided above in this Section 9.02, no
Person shall be considered a Member, and the Company, each Member and any

                                       24
<PAGE>

other Persons having business with the Company need deal only with the Members
so named or so admitted and shall not be required to deal with any other Person
by reason of a Transfer by a Member. If an assignee of a Member does not become
a Substituted Member pursuant to this Section 9.02, the assignee shall not have
any rights to require any information on account of the Company's business, to
inspect the Company's books, or to vote on or otherwise take part in the affairs
of the Company.

      9.03 PERMITTED TRANSFERS. For purposes of this Article 9, the term
"PERMITTED TRANSFER" shall mean (subject at all times to the provisions of
Section 9.05) as follows: with respect to Lucente Enterprises, Inc. or
Chesapeake Custom Homes, L. L. C., any Transfer to an entity Controlled by any
of Frank Lucente, Jr., Michael Webb or Greg Wilby (collectively "CHESAPEAKE
PRINCIPALS"); with respect to J. Webb, Inc., any Transfer following which to an
entity the management of which is Controlled by Michael Webb with respect to Old
Line Bancshares, Inc., any Transfer to an entity which is a wholly owned
Affiliate of Old Line Bancshares, Inc., or any entity purchasing Old Line
Bancshares, Inc. provided that in no event may any Member transfer in any one
year any Percentage which would result in a technical termination of the Company
for federal tax purposes. In the event of a Permitted Transfer by a Member, the
Member to whom such Permitted Transfer relates shall promptly provide evidence
of compliance with this Article 9 to the Manager.

      9.04  EFFECT OF BANKRUPTCY OR DISSOLUTION OF A MEMBER. The dissolution or
adjudication of bankruptcy of a Member shall not dissolve the Company.

      9.05  ADDITIONAL RESTRICTIONS ON TRANSFERS.

            No Transfer of a Membership Interest by a Member (or by any Person
owning any interest, directly or indirectly, in a Member) shall be made if such
disposition would (i) cause the Company to be treated as an association taxable
as a corporation (rather than a partnership) for federal income tax purposes;
(ii) violate the provisions of any federal or state securities laws; (iii)
violate the terms of any law, rule or regulation binding on the Company; (iv)
causes a dissolution of the Company for federal tax purposes; or (v) contravene
any provision of, or trigger consent rights under, any other agreement of the
Company (including without limitation any loan document, lease or management
agreement), unless consent is actually obtained, at the sole cost of the Member
or Person seeking to Transfer, and such Transfer does not cause the Company to
incur any costs or be in breach of any agreement, and does not render any
agreement to which the Company is a party to be rendered terminable or be
otherwise negatively affected.

      9.06  GOOD FAITH COOPERATION. If any third party consent is necessary to
satisfy any requirement of this Article 9, the Members agree to cooperate in
good faith in order to obtain such consent.

                                       25
<PAGE>

      9.07  RIGHT OF FIRST REFUSAL OF MEMBERSHIP INTEREST TRANSFER. In the event
a Member (in each case a "SELLING MEMBER") decides to sell its Member Interest
or any part thereof, the Selling Member shall first offer in writing (the
"SELLING NOTICE") such Member Interest to Old Line Bancshares, Inc. ("OLD
LINE"). The Selling Notice shall set forth the price, terms and closing date
under which the Selling Member is willing to sell the Member Interest. Old Line
shall have a period of thirty (30) days from the date of receipt of the Selling
Notice (the "RESPONSE PERIOD") to notify the Selling Member that it is electing
to purchase such Member Interest in accordance with the terms set forth in the
Selling Notice. In the event Old Line either rejects the Selling Notice or fails
to respond to the Selling Notice prior to the expiration of the Response Period,
the Selling Member shall have the right to sell, free and clear of any rights of
Old Line pursuant to this Section 9.07 (but subject to compliance with all other
provisions of this Agreement) the Member Interest which is the subject of the
Selling Notice for the same price and materially the same terms as provided in
the Selling Notice. The provisions of this Section 9.07 shall not apply to any
Transfer of a Member Interest which is Permitted Transfer or to any transfers
for estate tax planning purposes consented to by the Manager.

10.   TERM

      10.01 TERM AND DISSOLUTION. The existence of the Company shall continue
until the earlier of:

            (A) December 31, 2035;

            (B) A Members Committee Vote to dissolve the Company;

            (C) A date to be selected by the Manager within six (6) months after
the sale, exchange or other disposition of all or substantially all of the
Company Property, but if the Company is holding purchase money mortgages in
connection with any of the foregoing the Company will continue until such
mortgages are satisfied, sold or otherwise disposed of; or

            (D) Any other event causing dissolution of the Company under the
Uniform Act unless, subject to applicable law, within 90 days thereafter the
Manager, to the extent they are then Members, elect to reconstitute the Company,
which election shall be evidenced by such writing as is required by law.

      10.02 LIQUIDATION OF COMPANY PROPERTY.

            (A) In the event of dissolution and final termination of the
Company, a full accounting of the assets and liabilities shall be taken, and the
assets shall be liquidated, with the Capital Proceeds therefrom distributed in
accordance with Article 6 hereof by the later of (I) the last day of the Fiscal
Year in which the termination occurs or (II) one hundred eight (180)days after
the date on

                                       26
<PAGE>

which the termination occurs. Upon the complete liquidation and distribution of
the Company Property, the Members shall cease to be Members of the Company, and
the Members shall execute, acknowledge and cause to be filed any certificates
and notices required by law to terminate the Company.

            (B) Upon the dissolution of the Company pursuant to Section 10.01,
the Manager shall prepare or cause to be prepared and furnished to each Member a
statement setting forth the assets and liabilities of the Company and, promptly
following the complete liquidation and distribution of the Company Property, a
statement showing the manner in which the Company Property was liquidated and
distributed.

      10.03 RIGHT OF FIRST REFUSAL OF PROPERTY. In the event the Company
receives an offer for the purchase of the Property which the Members Committee
is willing to accept (the "OFFER"), the Manager shall provide Old Line a copy of
the Offer. Old Line shall have a period of thirty (30) days from the date of
receipt of the Offer (the "RESPONSE PERIOD") to notify the Company in writing
that it is electing to purchase the Property in accordance with the Offer. In
the event Old Line either rejects the Offer or fails to respond prior to the
expiration of the Response Period, the Company shall have the right to sell the
Property under the terms set forth in the Offer, free and clear of any rights of
Old Line pursuant to this Section 10.03. In the event Old Line advises the
Company prior to the expiration of the Response Period that it has elected to
purchase the Property in accordance with the terms of the Offer, Old Line and
the Company shall promptly execute a contract for the purchase and sale of the
Property identical to the Offer (the "CONTRACT") and shall consummate the
Contract in accordance with its terms.

11.   MISCELLANEOUS

      11.01 AMENDMENT PROCEDURE. Except with respect to changes of an
administerial nature and which do not adversely affect the Members in any
material respect or to cure any ambiguity, or correct or supplement any
provision in this Agreement such as confirming a Transfer of Membership
Interests hereunder, which changes may be made by the Manager without the prior
consent of the other Members, this Agreement may not be amended without with the
unanimous Consent of the Members.

      11.02 MEETINGS. Meetings of Members may be called by the Manager, for
informational purposes or for any purpose permitted by this Agreement. Any
Member calling a meeting shall give each other Member Notice of the purpose of
such proposed meeting not less than two (2) business days nor more than sixty
(60) days before the meeting. Meetings shall be held at a reasonable time and
place selected by the Members. In addition, the Members may participate in a
meeting by means of conference telephone or similar communications equipment by
means of which all persons participating in a meeting can hear each other.

                                       27
<PAGE>

      11.03 TITLE TO COMPANY PROPERTY. All Company Property, whether real or
personal, tangible or intangible, shall be deemed to be owned by the Company as
an entity, and no Member, individually, shall have any ownership of such
property. The Company may hold any of the Company Property in its own name or,
in the name of its nominee, which nominee may be one or more individuals,
corporations, partnerships, trusts or other entities.

      11.05 RESOLUTION OF DISPUTES. If any Member breaches a representation,
warranty or covenant under this Agreement or otherwise defaults hereunder, the
other Members shall be entitled to pursue any action available at law or equity
and shall be entitled to recover any damages incurred as a result of such breach
or default.

      11.06 APPLICABLE LAW. It is the intent of the parties hereto that all
questions with respect to the construction of this Agreement and the rights and
liabilities of the parties hereto shall be determined in accordance with the
provisions of the laws of the State of Maryland without giving effect to the
choice of law rules thereof.

      11.07 BINDING AGREEMENT. Subject to the restrictions on Transfers set
forth herein, this Agreement shall inure to the benefit of and be binding upon
the parties hereto and their respective heirs, executors, legal or personal
representatives, successors and assigns. Whenever in this Agreement a reference
is made to any party or Member, such reference shall be deemed to include a
reference to the heirs, executors, legal or personal representatives, successors
and assigns of such party or Member.

      11.08 WAIVER OF PARTITION. Unless otherwise specifically provided in this
Agreement, no Member will, either directly or indirectly, take any action to
require partition or appraisement of the Company Property or the Company, and
notwithstanding any provision of applicable law to the contrary, each Member
(and its estate, personal or legal representative, heirs, beneficiaries,
distributees and successors and assigns) hereby irrevocably waives any and all
right to maintain any action for partition or to compel any sale with respect to
its interest in the Company or with respect to the Company Property.

      11.09 COUNTERPARTS AND EFFECTIVENESS. This Agreement may be executed in
several counterparts, which shall be treated as originals for all purposes, and
all so executed shall constitute one agreement, binding on all of the parties
hereto, notwithstanding that all the parties are not signatory to the original
or the same counterpart. Any such counterpart shall be admissible into evidence
as an original hereof against the Person who executed it. The execution of this
Agreement by facsimile signature shall be sufficient for all purposes and shall
be binding on any Person who so executes.

      11.10 SURVIVAL OF REPRESENTATIONS. All representations and warranties
herein shall survive the dissolution and final liquidation of the Company.

                                       28
<PAGE>

      11.11 ENTIRE AGREEMENT. This Agreement (and all Exhibits and Schedules
hereto) contains the entire understanding among the parties hereto and
supersedes all prior written or oral agreements among them respecting the within
subject matter, unless otherwise provided herein. There are no representations,
agreements, arrangements or understandings, oral or written, between the Members
hereto relating to the subject matter of this Agreement which are not fully
expressed herein and in said Exhibits and Schedules.

      11.12 WAIVER. No consent or waiver, express or implied, by any Member to
or of any breach or default by any other Member in the performance by the other
of its obligations hereunder shall be deemed or construed to be a consent or
waiver to or of any other breach or default by the other in the performance by
such other party of the same or any other obligations of such Member hereunder.
Failure on the part of any Member to object to or complain of any act or failure
to act of the other Members or to declare the other Members in default,
irrespective of how long such failure continues, shall not constitute a waiver
by such Member of its rights hereunder.

      11.13 EXHIBITS. All exhibits and schedules referred to herein and attached
hereto are incorporated by reference into this Agreement.

         11.14 TIME PERIODS. Any time period hereunder which expires on, or any
date for performance hereunder which occurs on, a Saturday, Sunday or legal
United States holiday (other than the Effective Date), shall be deemed to be
postponed to the next business day. The first day of any time period hereunder
which runs "from" or "after" a given day shall be deemed to occur on the day
subsequent to that given day.

         11.15 WAIVER OF TRIAL BY JURY. IN THE EVENT THAT ANY DISPUTE IS BROUGHT
BEFORE ANY COURT OF COMPETENT JURISDICTION FOR RESOLUTION OF ANY DISPUTE, EACH
OF THE PARTIES HERETO FULLY AND FREELY WAIVES TRIAL BY JURY. ANY SUCH ACTION
SHALL BE TRIED BY A JUDGE AS THE FINDER OF FACT. EACH MEMBER AND THE MANAGER
HEREBY EXPRESSLY COVENANTS AND AGREES: (i) NOT TO ELECT A TRIAL BY JURY OF ANY
ISSUE TRIABLE OF RIGHT BY A JURY IN CONNECTION WITH ANY LITIGATION OR JUDICIAL
PROCEEDING IN ANY WAY RELATING TO OR CONCERNING THIS AGREEMENT OR ANY DISPUTES
ARISING UNDER THIS AGREEMENT OR IN ANY WAY RELATING TO THE RELATIONSHIP, DUTIES,
OBLIGATIONS OR AGREEMENTS BETWEEN THE COMPANY, THE MEMBERS AND THE MANAGER
(COLLECTIVELY "LITIGATION"); AND (ii) EXPRESSLY WAIVES THE RIGHT TO A JURY TRIAL
IN CONNECTION WITH ANY LITIGATION TO THE FULL EXTENT PERMITTED BY LAW. THIS
WAIVER OF RIGHT TO TRIAL BY JURY IS SEPARATELY GIVEN AND IS KNOWINGLY AND
VOLUNTARILY MADE BY THE COMPANY, EACH MEMBER AND THE MANAGER AND THIS WAIVER IS
INTENDED TO AND DOES ENCOMPASS EACH INSTANCE AND EACH ISSUE AS TO WHICH THE
RIGHT TO A JURY TRIAL WOULD OTHERWISE ACCRUE. EACH MEMBER, THE MANAGER AND THE
COMPANY FURTHER CERTIFIES AND ACKNOWLEDGES TO EACH OTHER THAT NO REPRESENTATIVE
OR AGENT OF THE COMPANY, THE MANAGER OR ANY MEMBER (INCLUDING, BUT NOT LIMITED
TO, THEIR RESPECTIVE COUNSEL) HAS REPRESENTED,

                                       29
<PAGE>

EXPRESSLY OR OTHERWISE TO THE COMPANY, ANY MEMBER OR THE MANAGER (INCLUDING, BUT
NOT LIMITED TO, THEIR RESPECTIVE COUNSEL) THAT THE COMPANY, THE MEMBERS AND THE
MANAGER WILL NOT SEEK TO ENFORCE THIS WAIVER OF RIGHT TO JURY TRIAL.

      11.16 TIME OF THE ESSENCE. Time shall be of the essence with respect to
the performance of every provision of this Agreement.

      11.17 SECURITIES LAW REPRESENTATIONS, WARRANTIES AND AGREEMENTS.

            (A) EACH MEMBER REPRESENTS AND WARRANTS TO THE COMPANY AND THE OTHER
MEMBERS AS FOLLOWS:

                  (1) IT HAS SUCH KNOWLEDGE AND EXPERIENCE IN FINANCIAL AND
BUSINESS MATTERS THAT IT IS CAPABLE OF EVALUATING THE MERITS AND RISKS OF THE
INVESTMENT INVOLVED IN THE PURCHASE OF A MEMBERSHIP INTEREST IN THE COMPANY AND
IT HAS SO EVALUATED THIS PURCHASE.

                  (2) IT IS AWARE THAT THIS INVESTMENT IS SPECULATIVE AND
REPRESENTS A SUBSTANTIAL RISK OF LOSS.

                  (3) IT IS ABLE TO BEAR THE ECONOMIC RISK OF THIS INVESTMENT.

                  (4) IN CONNECTION WITH THE PURCHASE OF ITS MEMBERSHIP
INTEREST, IT HAS BEEN FULLY INFORMED AS TO THE CIRCUMSTANCES UNDER WHICH IT IS
REQUIRED TO TAKE AND HOLD ITS MEMBERSHIP INTEREST PURSUANT TO THE REQUIREMENTS
OF THE SECURITIES UNIFORM ACT OF 1933 (THE "SECURITIES UNIFORM ACT") AND
APPLICABLE STATE SECURITIES LAWS.

                  (5) IT UNDERSTANDS THAT ITS MEMBERSHIP INTEREST IS NOT
REGISTERED UNDER THE SECURITIES UNIFORM ACT OR ANY STATE SECURITIES AND MAY NOT
BE TRANSFERRED, ASSIGNED OR OTHERWISE DISPOSED OF UNLESS ITS MEMBERSHIP INTEREST
IS SO REGISTERED OR UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE.

            (B) EACH MEMBER AGREES AS FOLLOWS:

                  (1) THE COMPANY IS NOT UNDER ANY OBLIGATION TO REGISTER ANY
MEMBERSHIP INTEREST UNDER THE SECURITIES UNIFORM ACT OR ANY STATE SECURITIES
LAWS.

                  (2) THE COMPANY WILL NOT BE REQUIRED TO SUPPLY ANY MEMBER OR
OTHER PERSON WITH ANY INFORMATION NECESSARY TO ENABLE ANY MEMBER TO MAKE A
CASUAL SALE OF ITS MEMBERSHIP INTEREST UNDER RULE 144 UNDER THE SECURITIES
UNIFORM ACT OR ANY CORRESPONDING RULE UNDER ANY STATE SECURITIES LAW.

            (C) EACH MEMBER SHALL INDEMNIFY AND HOLD HARMLESS THE COMPANY AND
THE OTHER MEMBERS FROM AND AGAINST ANY AND ALL LOSS, DAMAGE,

                                       30
<PAGE>

LIABILITY, COST OR EXPENSE, INCLUDING COSTS OF DEFENSE AND ATTORNEYS' FEES,
ARISING OR RESULTING FROM OR ATTRIBUTABLE TO ANY BREACH OF HIS REPRESENTATIONS,
WARRANTIES OR AGREEMENTS SET FORTH IN THIS SECTION 11.17.

      11.18 LIMITATION OF LIABILITY. Except as provided in Section 5.01(B) with
respect to initial Capital Contributions, no Member shall be personally liable
to any other Member or to any other party under this Agreement, it being agreed
that in the event of a breach of this Agreement, the sole recourse for such
breach shall be against its Membership Interest hereunder and/or any proceeds or
amounts distributable to the applicable Member in respect thereof.

                 (BALANCE OF THIS PAGE INTENTIONALLY LEFT BLANK)

                                       31
<PAGE>

      IN WITNESS WHEREOF, this Agreement has been executed as of the day and
year first above written.

                                MEMBERS:

                                J. WEBB GROUP, INC., A
                                VIRGINIA CORPORATION

                                BY:  /S/ MICHAEL M. WEBB                  (SEAL)
                                     -------------------------------------
                                     MICHAEL M. WEBB, PRESIDENT

                                /S/ MICHAEL M. WEBB                       (SEAL)
                                     -------------------------------------
                                    MICHAEL M. WEBB,
                                    INDIVIDUALLY

                                LUCENTE ENTERPRISES, INC., A
                                MARYLAND CORPORATION

                                BY:  /S/ FRANK LUCENTE, JR.               (SEAL)
                                     -------------------------------------
                                     FRANK LUCENTE, JR. PRESIDENT

                                CHESAPEAKE CUSTOM HOMES, L.L.C., A
                                MARYLAND LIMITED LIABILITY COMPANY

                                BY:  /S/ GREG S. WILBY                   (SEAL)
                                     -------------------------------------
                                     GREG S. WILBY,
                                      AUTHORIZED SIGNATORY

                                OLD LINE BANCSHARES, INC., A
                                MARYLAND CORPORATION

                                BY:  /S/ JAMES W. CORNELSEN               (SEAL)
                                     -------------------------------------
                                    JAMES W. CORNELSEN,
                                    PRESIDENT

                        (SIGNATURE OF MANAGER ON NEXT PAGE)

                                       32
<PAGE>

                                AS MANAGER AND NOT AS A MEMBER:

                                CHESAPEAKE POINTER RIDGE MANAGER,
                                LLC, A MARYLAND LIMITED LIABILITY COMPANY,

                                BY:  /S/ GREG S. WILBY                    (SEAL)
                                     -------------------------------------
                                     GREG S. WILBY,
                                     AUTHORIZED SIGNATORY

  (BALANCE OF THIS PAGE INTENTIONALLY LEFT BLANK-EXHIBIT 1 STARTS ON NEXT PAGE)

                                       33
<PAGE>

                                    EXHIBIT 1
                             OPERATING AGREEMENT FOR
                     POINTERS RIDGE OFFICE INVESTMENTS, LLC

<TABLE>
<CAPTION>
                                              INITIAL CAPITAL         PERCENTAGE OF MEMBERSHIP
  MEMBER                                       CONTRIBUTION                  INTERESTS
  ------                                       ------------                  ---------
<S>                                           <C>                     <C>
  LUCENTE ENTERPRISES, INC.                   $   137,500                     12.5%
  6196 OXON HILL ROAD, SUITE
  340, OXON  HILL, MARYLAND
  20745

  CHESAPEAKE CUSTOM HOMES, L.L.C.             $   137,500                     12.5%
  6196 OXON HILL ROAD, SUITE
  340, OXON HILL, MARYLAND
  20745

  J. WEBB GROUP, INC.                         $   220,000                       20%
  7857 HERITAGE DRIVE
  SUITE 300
  ANNANDALE, VIRGINIA 22003

  MICHAEL M. WEBB                             $    55,000                        5%
  C/O J. WEBB, INC.
  7857 HERITAGE DRIVE
  SUITE 300
  ANNANDALE, VIRGINIA 22003

  OLD LINE BANCSHARES, INC.                   $   550,000                       50%
  P.O. BOX 1890, WALDORF, MD. 20604
  STREET ADDRESS:
  2995 CRAIN HIGHWAY, WALDORF, MD. 20601

  TOTAL                                       $ 1,100,000                      100%
</TABLE>

                                       34
<PAGE>

                                    EXHIBIT 2
                                       TO
                             OPERATING AGREEMENT FOR
                      POINTER RIDGE OFFICE INVESTMENT, LLC

ALLOCATION PROVISIONS - MEMBERS

      1. DEFINITIONS. The following terms shall have the meaning ascribed to
them for purposes of this EXHIBIT 2 and for purposes of the Agreement:

      "ADJUSTED CAPITAL ACCOUNT DEFICIT" shall mean, with respect to any Member,
the deficit balance, if any in such Member's Capital Account as of the end of
the relevant Fiscal Year, after giving effect to the following adjustments:

            (A) Credit to such Capital Account any amounts which such Member is
obligated to restore or is deemed to be obligated to restore pursuant to the
penultimate sentences of Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5);
and

            (B) Debit to such Capital Account the items described in Regulations
Sections 1.704-1(b)(2)(ii)(d)(4), (5) and (6).

      The foregoing definition of Adjusted Capital Account Deficit is intended
to comply with the provisions of Regulations Section 1.704-1(b)(2)(ii)(d) and
shall be interpreted consistently therewith.

      "COMPANY MINIMUM GAIN" has the meaning set forth in Regulations Sections
1.704-2(b)(2) and (d) for "PARTNERSHIP MINIMUM GAIN."

      "DEPRECIATION" means, for each Fiscal Year or other period, an amount
equal to the depreciation, amortization, or other cost recovery deduction
allowable with respect to an asset for such year or other period, except that if
the Gross Asset Value of an asset differs from its adjusted basis for federal
income tax purposes at the beginning of such year or other period, Depreciation
shall be an amount which bears the same ratio to such beginning Gross Asset
Value as the federal income tax depreciation, amortization, or other cost
recovery deduction for such year or other period bears to such beginning
adjusted tax basis; provided, however, that if the federal income tax
depreciation, amortization, or other cost recovery deduction for such year is
zero, Depreciation shall be determined with reference to such beginning Gross
Asset Value using any reasonable method selected by the Members.

                                       35
<PAGE>

      "MEMBER MINIMUM GAIN" means, an amount, with respect to each Member
Nonrecourse Debt, equal to the Company Minimum Gain that would result if such
Member Nonrecourse Debt were treated as a Nonrecourse Liability, determined in
accordance with Regulations Section 1.704-2(i).

      "MEMBER NONRECOURSE DEBT" has the meaning set forth in Regulations Section
1.704-2(b)(4) for "PARTNER non-RECOURSE DEBT."

      "MEMBER NONRECOURSE DEDUCTIONS" has the meaning set forth in Regulations
Section 1.704-2(i) for "PARTNER NON-RECOURSE DEDUCTIONS." The amount of Member
Nonrecourse Deductions with respect to a Member Nonrecourse Debt for a Fiscal
Year equals the excess, if any, of the net increase, if any, in the amount of
Member Minimum Gain attributable to such Member Nonrecourse Debt during that
Fiscal Year over the aggregate amount of any distributions during that Fiscal
Year to the Member that bears the economic risk of loss for such Member
Nonrecourse Debt to the extent such distributions are from the proceeds of such
Member Nonrecourse Debt and are allocable to an increase in Member Minimum Gain
attributable to such Member Nonrecourse Debt, determined in accordance with
Regulations Section 1.704-2(i)(2).

      "NONRECOURSE DEDUCTIONS" has the meaning set forth in Regulations Sections
1.704-2(b)(1) and (c). The amount of Nonrecourse Deductions for a Fiscal Year
equals the excess, if any, of the net increase, if any, in the amount of Company
Minimum Gain during that Fiscal Year over the aggregate amount of any
distributions during that Fiscal Year of proceeds of a Nonrecourse Liability
that are allocable to an increase in Company Minimum Gain, determined according
to the provisions of Regulations Section 1.704-2(c).

      "NONRECOURSE LIABILITY" has the meaning set forth in Regulations Section
1.752-1(a)(2).

      "PROFITS AND LOSSES" means, for each Fiscal Year or other period, an
amount equal to the Company's taxable income or loss for such year or period,
determined in accordance with Code Section 703(a) (for this purpose, all items
of income, gain, loss, or deduction required to be stated separately pursuant to
Code Section 703(a)(1) shall be included in taxable income or loss), with the
following adjustments:

            (A) Any income of the Company that is exempt from federal income tax
and not otherwise taken into account in computing Profits or Losses pursuant to
this definition shall be added to such taxable income or loss;

            (B) Any expenditures of the Company described in Code Section
705(a)(2)(B) or treated as Code Section 705(a)(2)(B) expenditures pursuant to
Regulations Section 1.704-1(b)(2)(iv)(i), and not otherwise taken into account
in

                                       36
<PAGE>

computing Profits or Losses pursuant to this definition shall be subtracted from
such taxable income or loss;

            (C) In the event the Gross Asset Value of any Company Property is
adjusted pursuant to (B) or (C) of the definition of Gross Asset Value, the
amount of such adjustment shall be taken into account as gain or loss from the
disposition of such asset for purposes of computing Profits or Losses;

            (D) Gain or loss resulting from any disposition of Company Property
with respect to which gain or loss is recognized for federal tax income purposes
shall be computed by reference to the Gross Asset Value of the property disposed
of, notwithstanding that the adjusted tax basis of such property differs from
its Gross Asset Value;

            (E) In lieu of the depreciation, amortization, and other cost
recovery deductions taken into account in computing such taxable income or loss,
there shall be taken into account Depreciation for such Fiscal Year or other
period, computed in accordance with the definition of Depreciation; and

            (F) Notwithstanding any other provisions of this definition, any
items which are specially allocated pursuant to Section 2(C) hereof shall not be
taken into account in computing Profits or Losses.

      2. ALLOCATION OF PROFIT AND LOSS. The income, profits, gains, losses,
deductions and credits of the Company shall be determined in accordance with the
capital accounting rules and principles established by Code Sections 702 and 704
and the regulations thereunder and, to the extent not inconsistent therewith, in
accordance with generally accepted accounting principles, and shall be allocated
each Fiscal Year as follows and in the following order of priority:

            (A) After giving effect to the special allocations set forth in
Section 2(C), Profits for any Fiscal Year shall be allocated among the Members
as follows:

                  (1) First, to the Members with negative Capital Accounts, in
proportion to such negative Capital Accounts, until the negative Capital Account
of each Member is reduced to zero (0), but no Profit shall be allocated to any
Member pursuant to this Section 2(A)(1) once its negative Capital Account has
been brought to zero (0); and

                  (2) Next, to the Members, in a manner so as to cause the
positive Capital Account balance of each Member to equal the amount that would
be payable to such Member if an amount equal to the sum of (I) the positive
Capital Account balances of all Members (determined prior to any allocation of
Profits for such Fiscal Year but after any nonliquidating distributions to the
Members for such Fiscal Year have been reflected), increased by (II) the Profits
to be allocated among

                                       37
<PAGE>

the Members in such Fiscal Year, were distributed among the Members as provided
in Section 6.02.

            (B) After giving effect to the special allocations set forth in
Section 2(C) hereof, Losses for any Fiscal Year shall be allocated among the
Members as follows in the following order of priority:

                  (1) To the Members with positive Capital Accounts, in
proportion to such positive Capital Accounts; until the positive Capital Account
of each Member is brought to zero (0), but no loss shall be allocated to any
Member pursuant to this Section 2(B)(1) once its positive Capital Account has
been brought to zero (0) (provided, that, if there are insufficient Losses to
reduce all of the positive Capital Accounts of the Members to zero, Losses shall
be allocated among the Members in a manner so as to cause the positive Capital
Account balance of each Member to equal the amount that would be payable to such
member if an amount equal to the sum of (I) the positive Capital Account
balances of all Members (determined prior to any allocation of Losses for such
Fiscal Year but after any nonliquidating distributions to the Members for such
Fiscal Year have been reflected), decreased by (II) the Losses to be allocated
among the Members in such Fiscal Year, were distributed among the Members as
provided in Section 6.02; and

                  (2) Thereafter, to the Members in proportion to their
Percentages of Membership Interests.

            (C) SPECIAL ALLOCATIONS. The following special allocations shall be
made in the following order:

                  (1) MINIMUM GAIN CHARGEBACK. Notwithstanding any other
provision of this EXHIBIT 2, if there is a net decrease in Company Minimum Gain
during any Fiscal Year, then, to the extent required by Regulations Section
1.704-2(f), each Member shall be specially allocated items of Company income and
gain relating to the Company Property for such year (and, if necessary,
subsequent years) in an amount equal to such Member's share of the net decrease
in Company Minimum Gain, determined in accordance with Regulations Section
1.704-2(g)(2). The items to be so allocated shall be determined in accordance
with Regulations Sections 1.704-2(f)(6) and 1.704-2(j). This Section 2(C)(1) is
intended to comply with the minimum gain chargeback requirement in Regulations
Section 1.704-2(f) and shall be interpreted consistently therewith.

                  (2) MEMBER MINIMUM GAIN CHARGEBACK. Notwithstanding any other
provision of this EXHIBIT 2 except Section 2(C)(1), if there is a net decrease
in Member Minimum Gain attributable to a Member Nonrecourse Debt during any
Fiscal Year, then, to the extent required by Regulations Section 1.704-2(i)(4),
each Member who has a share of the Member Minimum Gain attributable to such
Member Nonrecourse Debt, determined in accordance with Regulations Section
1.704-2(i)(5), shall be specially allocated items of Company income and gain

                                       38
<PAGE>

relating to the Company Property for such year (and, if necessary, subsequent
years) in an amount equal to such Member's share of the net decrease in Member
Minimum Gain attributable to such Member Nonrecourse Debt, determined in
accordance with Regulations Section 1.704-2(i)(4). The items to be so allocated
shall be determined in accordance with Regulations Sections 1.704-2(i)(4) and
1.704-2(j). This Section 2(C)(2) is intended to comply with the minimum gain
chargeback requirement in Regulations Section 1.704-2(i)(4) and shall be
interpreted consistently therewith.

                  (3) QUALIFIED INCOME OFFSET. In the event any Member
unexpectedly receives any adjustments, allocations, or distributions described
in Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5) or (6), items of Company
income and gain (consisting of a pro rata portion of each item of Company
income, including gross income, and gain for such year) relating to the Company
Property shall be specially allocated to such Member in an amount and manner
sufficient to eliminate, to the extent required by the Regulations, the Adjusted
Capital Account Deficit of such Member as quickly as possible, provided that an
allocation pursuant to this Section 2(C)(3) shall be made if and only to the
extent that such Member would have a Adjusted Capital Account Deficit after all
other allocations provided for in Section 2 of this Exhibit 1 have been
tentatively made as if this Section 2(C)(3) were not in this Exhibit.

                  (4) GROSS INCOME ALLOCATION. In the event any Member has an
Adjusted Capital Account Deficit at the end of any Fiscal Year, such Member
shall be specially allocated items of Company income and gain (consisting of a
pro rata portion of each item of income, including gross income, and gain for
such year) relating to the Company Property, in the amount of such excess as
quickly as possible, provided that an allocation pursuant to this Section
2(C)(4) shall be made if and only to the extent that such Member would have an
Adjusted Capital Account Deficit after all other allocations provided for in
Section 2 of this Exhibit 1 have been tentatively made as if Section 2(C)(3) and
this Section 2(C)(4) were not in this EXHIBIT 2.

                  (5) NONRECOURSE DEDUCTIONS. Nonrecourse Deductions for any
Fiscal Year or other period relating to the Company Property shall be specially
allocated to the Members in proportion to their Percentages of Membership
Interest.

                  (6) MEMBER NONRECOURSE DEDUCTIONS. Any Member Nonrecourse
Deductions for any Fiscal Year or other period relating to the Company Property
shall be specially allocated to the Member who bears the economic risk of loss
with respect to the Member Nonrecourse Debt to which such Member Nonrecourse
Deductions are attributable in accordance with Regulations Section
1.704-2(i)(1).

                                       39
<PAGE>

                  (7) SECTION 754 ADJUSTMENT. To the extent an adjustment to the
adjusted tax basis of any Company Property pursuant to Code Section 734(b) or
Code Section 743(b) is required, pursuant to Regulations Section
1.704-1(b)(2)(iv)(m), to be taken into account in determining Capital Accounts,
the amount of such adjustment to the Capital Accounts shall be treated as an
item of gain (if the adjustment increases the basis of the asset) or loss (if
the adjustment decreases such basis) relating to the Company Property, and such
gain or loss shall be specially allocated to the Members in a manner consistent
with the manner in which their Capital Accounts are required to be adjusted
pursuant to such Regulations Section.

            (D) OTHER ALLOCATION RULES.

                  (1) For purposes of determining the Profits, Losses or any
other items allocable to any period, Profits, Losses and any such other items
shall be determined on a daily, monthly, or other basis, as determined by the
Members using any permissible method under Code Section 706 and the Regulations
thereunder.

                  (2) Except as otherwise provided in this Agreement, all items
of Company income, gain, loss, deduction and any other allocations not otherwise
provided for shall be divided among the Members in the same proportions as they
share Profits and Losses, as the case may be, for the year.

                  (3) The Members are aware of the income tax consequences of
the allocations made pursuant to the provisions of this EXHIBIT 2 hereof and
hereby agree to be bound by the provisions of this EXHIBIT 2 hereof in reporting
their shares of Company income and loss for income tax purposes.

                  (4) Solely for purposes of determining a Member's
proportionate share of the "EXCESS NONRECOURSE LIABILITIES" of the Company
relating to the Company Property within the meaning of Regulations Section
1.752-3(a)(3), the Members' interests in Company profits shall be equal to their
Percentages of Membership Interests.

            (E) It is the intent of the Members that each Member's distributive
share of income, gain, loss, deduction, or credit (or item thereof) shall be
allocated in accordance with this EXHIBIT 2 to the fullest extent permitted by
Section 704(b) of the Code.

      3. TAX ALLOCATIONS: CODE SECTION 704(c).

                  (1) In accordance with Code Section 704(c) and the Regulations
thereunder, income, gain, loss and deduction with respect to any property
contributed to the capital of the Company by the Members shall, solely for tax
purposes, be allocated among the Members so as to take account of any

                                       40
<PAGE>

variation between the adjusted basis of such property to the Company for federal
income tax purposes and its initial Gross Asset Value (computed in accordance
with the definition herein).

                  (2) In the event the Gross Asset Value of any Company Property
is adjusted, subsequent allocations of income, gain, loss and deduction with
respect to such asset shall take account of any variation between the adjusted
basis of such asset for federal income tax purposes and its Gross Asset Value in
the same manner as under Code Section 704(c) and the Regulations thereunder.

                  (3) Any elections or other decisions relating to such
allocations to the Members shall be made by the Members in any manner that
reasonably reflects the purpose and intention of this Agreement. Allocations
pursuant to this Section 3 are solely for purposes of federal, state and local
taxes and shall not affect, or in any way be taken into account in computing,
any Member's Capital Account or share of Profits, Losses, other items, or
distributions pursuant to any provision of this Agreement.

      4. SPECIAL BASIS ADJUSTMENTS

      In the event of a Transfer of all or any part of the Member Interest of
any Member for an amount in excess of the adjusted basis for such Membership
Interest for federal income tax purposes, the Company shall elect, pursuant to
Section 754 of the Code to adjust the basis of the Company Property.
Notwithstanding anything contained in this Agreement, any adjustments made
pursuant to Section 754 shall affect only the successor in interest to the
transferring Member. Each successor in interest to the transferring Member will
furnish the Company with all information necessary to give effect to such
election and shall pay all out-of-pocket costs and expenses of the Company
associated with any election applicable as to such Member. Unless otherwise
specifically provided, neither adjustments to basis, nor adjustments to the
taxable income of a Member as a result of this Section 4, shall affect its
positive Capital Account.

                                       41
<PAGE>

                                    EXHIBIT 3
                                       TO
                             OPERATING AGREEMENT FOR
                      POINTER RIDGE OFFICE INVESTMENT, LLC
                       SCHEDULE OF FEES PAYABLE TO MANAGER

      A. REIMBURSABLE EXPENSES. The following expenses ("REIMBURSABLE
EXPENSES"), shall be reimbursed by the Company to the Manager to the extent
actually incurred by the Manager or its designated Affiliate:

Telephone and telecopy expenses; postage; photocopy expenses; courier expenses
and similar expenses.

The legal fees and costs associated with the drafting and formation of the
Company and its constituent entities shall be a Reimbursable Expense.

      B. DEVELOPMENT, CONSTRUCTION MANAGEMENT AND TENANT IMPROVEMENT FEES.
During the term of the Agreement, in consideration for the Manager's management
and oversight of land development of the Property and construction of the
Project (including but not limited to the cost of construction of the
Improvements and any tenant improvements) the Company shall pay to the Manager a
fee equal to five percent (5%) of the total cost of such development and
construction. The fee payable to the Manager shall be payable in monthly
installments over the time period during which construction and development is
to be performed.

      C. LEASING FEES AND RELATED REIMBURSABLE EXPENSES.

            (a) During the term of the Company, in consideration for the
Manager's or its designated Affiliate's supervision and management of the
Company's leasing activities, the Company shall pay to the Manager or its
designated Affiliate the leasing fees hereinafter described ("LEASING FEES")
with respect to each (I) lease for space in the Project ("LEASE"), (II)
extension or renewal of the term of a Lease, or (III) expansion of the premises
leased under a Lease (collectively, a "LEASING EVENT"), entered into by the
Company during the term of the Company. The Company shall pay to the Manager or
its designated Affiliate any Leasing Fees payable hereunder within ten (10) days
following the end of the month during which full execution of the document
giving effect to the Leasing Event occurred.

                                       42
<PAGE>

            (b) With respect to any Leasing Event, the Company shall pay the
following Leasing Fees to the Manager or its designated Affiliate:

                  (i) If the Leasing Event occurred with the Manager or an
Affiliate thereof acting as the broker without the assistance of a listing
broker or a procuring broker (other than the Manager or an Affiliate thereof),
then the Manager (or such Affiliate) shall be entitled to a commission of 2.00%
of Base Rent in connection with such Leasing Event.

                  (ii) If the Leasing Event occurred with the Manager or an
Affiliate thereof acting as the listing broker, but involved the assistance of a
procuring broker (other than the Manager or an Affiliate thereof), then the
Manager (or such Affiliate) shall be entitled to a commission of 1.00% of Base
Rent in connection with such Leasing Event.

                  (iii) If the Leasing Event occurred with the assistance of a
listing broker but without the assistance of a procuring broker (other than the
Manager or an Affiliate thereof), then the Manager (or such Affiliate) shall be
entitled to a commission of 1.00% of Base Rent in connection with such Leasing
Event.

                  (iv) If the Leasing Event occurred with the assistance of a
listing broker and with the assistance of a procuring broker, then the Manager
(or such Affiliate) shall be entitled to a commission of 0.50% of Base Rent in
connection with such Leasing Event.

                  (v) Notwithstanding the foregoing, any lease with a Member or
Affilate shall not require payment of any commission by the Company.

      "BASE RENT" shall mean the fixed rent stated in a tenant lease or license
agreement (regardless of how such rent is denominated), including the amount of
any escalator clause the amount of which is known at the time the tenant lease
or license agreement is executed, with reduction for any rental waiver or
abatement (and excluding amounts in respect of loans made by the Company to
tenants that are memorialized by a promissory note) and with reduction in an
amount equal to the excess, if any, of the tenant improvement costs included in
the fixed rent stated in the applicable tenant lease over budgeted base building
tenant improvement standard, for tenant's use and occupancy of the premises
demised thereunder during the first ten (10) years of the term thereof;
provided, however, that if any tenant is required under its lease to pay
directly for any portion of any element of the operating expenses or real estate
taxes related to the property (i.e., if such lease is fully or partially "net"
of certain costs and expenses), then the base rent for each year during the term
of such lease shall be deemed to be increased by an amount equal to the excess,
if any, of (I) the "expense stop" or base year that would be provided for in a
"full service lease" (defined below) in effect for the calendar year in

                                       43
<PAGE>

which the lease is executed over (ii) the expense stop or base year provided for
in the lease. As used herein, the term "expense stop" or the value of the "base
year" means the annual amount of real estate taxes and operating expenses
allocable to leased space that are to be absorbed by the landlord, rather than
being passed through to the tenant (which annual amount may be expressed in
terms of a fixed amount per square foot or in terms of expenses incurred in a
base year) and the term "full service lease" means a lease under which the
landlord agrees to pay for all real estate taxes, utilities, and other operating
expenses allocable to the leased space (whether or not all or a portion of such
expenses are passed through to the tenant in the form of additional rent). For
example, assume that tenant T enters into a five-year lease commencing in 2004
for 1,000 square feet, which lease requires T to pay directly for all
electricity provided to T's space and further provides that the other operating
expenses and real estate taxes allocable to the leased space will be passed
through to T as additional rent to the extent that such allocable amount for any
year exceeds an expense stop or base year value of $4.00 per square foot. Assume
further that, pursuant to the leasing guidelines in effect for 2004, the expense
stop or base year value to be provided for in full service leases executed in
that year is $5.00 per square foot. The annual base rent under T's lease would
be deemed to be increased by $1,000 (1,000 square feet x ($5.00 - $4.00).

            The Leasing Fees so payable to the Manager or the designated
Affiliate shall be determined as provided above, without regard to whether (I)
any commissions then payable to any procuring broker (other than the Manager or
any Affiliate thereof) are based upon a commission schedule that is structured
differently, or (ii) any particular Leasing Event would provide for a third
party leasing commission to any other participating broker greater or less than
the corresponding Leasing Fees payable to the Manager or its designated
Affiliate hereunder.

                  (d) In addition to the Leasing Fees the Company (and not the
Manager or any of its Affiliates) shall be responsible for, and if incurred by
the Manager or any of its Affiliates, the Company shall reimburse the Manager or
its Affiliates for the following costs and expenses (the "Leasing Reimbursable
Expenses"): (i) all costs incurred in connection with the marketing or the
leasing of space in the Investment, including without limitation, all marketing
events and functions, Web site costs and expenses, leasing signs, brochures,
floor plans, renderings and space plans, and (ii) all payments due and owing to
third party listing brokers or procuring brokers. All of the Leasing
Reimbursable Expenses payable to the Manager or any of its Affiliates shall be
paid by the Company within ten (10) days following the end of the month in
respect of which the Leasing Reimbursable Expenses were incurred or paid.

                                       44
<PAGE>

      (D) PROPERTY MANAGEMENT FEE.

                  (a) During the term of the Company, in consideration for the
Manager's or its designated Affiliate's performance of property management
services as to any Investment for which management the Company has not engaged a
management company other than the Manager or its designated Affiliate, the
Company shall pay to the Manager or its designated Affiliate a property
management fee (the "PROPERTY MANAGEMENT FEE") to be calculated as provided
herein. The Property Management Fee shall be calculated so as to be equal to the
greater of 5.00% of Gross Revenues from the Projects operations during the
respective calendar month, The Property Management Fee shall be payable monthly
in arrears within ten (10) days after the last day of each calendar month
(prorated for any partial calendar month).

                  (b) "Gross Revenues" means all revenues of the Company from
leasing and its operations but excluding (i) security deposits made by tenants
in such Investment (except to the extent that such security deposits are applied
to rent and other amounts payable by tenants of such Investments), (ii) proceeds
from the sale or financing, (iii) proceeds from insurance or condemnation with
respect to such Investment (except to the extent such proceeds are payments for
lost rents or other amounts payable by tenants of such Investment), (iv) all
federal, state and local excise, sales, use or rent taxes (other than such real
property taxes and other taxes which are payable to the landlord as operating
expenses by tenants under Leases), and (v) Capital Contributions made by the
Partners to the Company in respect of such Investment.

      (E) SALE OR REFINANCING. In the event the Company refinances the initial
mortgage financing on the Project after rent stablization or sells the Project,
the Manager will receive a fee of one percent (1%) of the gross amount of such
refinancing or sale price. Such fee shall be in addition to any other fee
payable to the Manager hereunder and shall be paid to the Manager at the time of
the closing of the refinancing or sale.

                                       45
<PAGE>

                                    EXHIBIT 4
                            (DESCRIPTION OF PROPERTY)

                                       46

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