Document:

Exhibit

HCNB BANCORP, INC. 
2002 STOCK OPTION PLAN
1.Purpose of the Plan.  The purpose of this HCNB Bancorp, Inc. 2002 Stock Option Plan (the “Plan”) is to advance the interests of the Company by providing directors and selected key employees of the Bank, the Company, and their Affiliates with the opportunity to acquire Shares.  By encouraging stock ownership, the Company seeks to attract, retain and motivate the best available personnel for positions of substantial responsibility; to provide additional incentive to directors and key employees of the Company, the Bank and their Affiliates to promote the success of the business as measured by the value of its shares; and generally to increase the commonality of interests among directors, key employees, and other shareholders.
2.    Definitions.  In this Plan:
(a)    “Affiliate” means any “parent corporation” or “subsidiary corporation” of the Company as such terms are defined in Section 424(e) and (f), respectively, of the Code.
(b)    “Agreement” means a written agreement entered into in accordance with Paragraph 5(c).
(c)    “Bank” means Harbor Capital National Bank.
(d)    “Board” means the Board of Directors of the Company.
(e)    “Bank Board” means the Board of Directors of the Bank.
(f)    “Change in Control” means any one of the following events occurring after the Effective Date: (1) the acquisition of ownership, holding or power to vote more than 25% of the Bank’s or Company’s voting stock, (2) the acquisition of the power to control the election of a majority of the Bank’s or Company’s directors, (3) the exercise of a controlling influence over the management or policies of the Bank or the Company by any person or by persons acting as a “group” (within the meaning of Section 13(d) of the Securities Exchange Act of 1934), or (4) the failure of Continuing Directors to constitute at least two-thirds of the Board of Directors of the Company or the Bank (the “Company Board”) during any period of two consecutive years.  For purposes of this Plan, “Continuing Directors” shall include only those individuals who were  members of the Company Board at the Effective Date and those other individuals whose election or nomination for election as a member of the Company Board was approved by a vote of at least two-thirds of the Continuing Directors then in office.  For purposes of this subparagraph only, the term “person” refers to an individual or a corporation, partnership, trust, association, joint venture, pool, syndicate, sole proprietorship, unincorporated organization or any other form of entity not specifically listed herein.  The decision of the Committee as to whether a Change in Control has occurred shall be conclusive and binding.
(g)    “Code” means the Internal Revenue Code of 1986, as amended.

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(h)    “Committee” means the Stock Option Committee appointed by the Board in accordance with Paragraph 5(a) hereof.
(i)    “Common Stock” means the common stock, par value $0.01 per share, of the Company.
(j)    “Company” means HCNB Bancorp, Inc.
(k)    “Continuous Service” means the absence of any interruption or termination of service as an Employee of the Company, the Bank or an Affiliate, or as a member of the Board or the Bank Board.  Continuous Service shall not be considered interrupted in the case of sick leave, military leave or any other leave of absence approved by the Company or in the case of transfers between payroll locations of the Company or between the Company, the Bank, an Affiliate or a successor.
(l)    “Effective Date” means the date specified in Paragraph 14 hereof.
(m)    “Employee” means any person employed by the Company, the Bank, or an Affiliate.
(n)    “Exercise Price” means the price per Optioned Share at which an Option may be exercised.
(o)    “ISO” means an option to purchase Common Stock that meets the requirements set forth in the Plan, and which is intended to be and is identified as an “incentive stock option” within the meaning of Section 422 of the Code.
(p)    “Just Cause” has the meaning set forth in any unexpired employment, service or severance agreement between the Participant and the Bank and/or the Company, or, in the absence of any such agreement, means termination because of the Participant’s personal dishonesty, incompetence, willful misconduct, breach of fiduciary duty involving personal profit, intentional failure to perform stated duties, willful violation of any law, rule or regulation (other than traffic violations or similar offenses) or final cease-and-desist order.
(q)    “Market Value” means the fair market value of the Common Stock, as determined under Paragraph 7(b) hereof.
(r)    “Non-Employee Director” means any member of the Board or the Bank Board who, at the time discretion under the Plan is exercised, is a “Non-Employee Director” within the meaning of Rule l6b-3.
(s)    “Non-ISO” means an option to purchase Common Stock that meets the requirements set forth in the Plan but which is not intended to be, and is not identified as, an ISO.
(t)    “Option” means an ISO or Non-ISO.
(u)    “Optioned Shares” means Shares subject to an Option granted pursuant to this Plan.

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(v)    “Outstanding Shares” means the total shares of Common Stock which have been issued and which (a) are not held as treasury shares, and (b) have not been cancelled or retired by the Company.
(w)    “Participant” means any person who receives an Option pursuant to the Plan.
(x)    “Permanent and Total Disability” means “permanent and total disability” as defined in Section 22(e)(3) of the Code.
(y)    “Plan” means the HCNB Bancorp, Inc. 2002 Stock Option Plan.
(z)    “Share” means one share of Common Stock.
(aa)    “Transaction” means (i) the liquidation or dissolution of the Company, (ii) a merger or consolidation in which the Company is not the surviving entity, or (iii) the sale or disposition of all or substantially all of the Company’s assets.
3.    Term of the Plan and Options.
(a)    Term of the Plan.  The Plan shall continue in effect for a term of ten years from the Effective Date unless sooner terminated pursuant to Paragraph 18.  No Option may be granted under the Plan after ten years from the Effective Date.
(b)    Term of Options.  The Committee shall establish the term of each Option granted under the Plan.  No Option may have a term that exceeds 10 years.  No ISO granted to an Employee who owns Shares representing more than 10% of the outstanding shares of Common Stock at the time an ISO is granted may have a term that exceeds five years.
4.    Shares Subject to the Plan
(a)    Except as otherwise required by the provisions of Paragraph 11, the aggregate number of Shares deliverable upon the exercise of Options pursuant to the Plan shall not exceed 100,000 Shares.  Optioned Shares may either be authorized but unissued Shares or Shares held in treasury to the extent allowed by Maryland law.
(b)    If Options should expire, become unexercisable or be forfeited for any reason without having been exercised or become vested in full, the Optioned Shares shall be available for the grant of additional Options under the Plan, unless the Plan shall have been terminated.
5.    Administration of the Plan.
(a)    Composition of the Committee.  The Plan shall be administered by the Committee, which shall consist of not less than three (3) members of the Board.  Members of the Committee may be Employee Directors or Non-Employee Directors, and shall serve at the pleasure of the Board.  In the absence at any time of a duly appointed Committee, the Plan shall be administered by the Board.

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(b)    Powers of the Committee.  Except as limited by the express provisions of the Plan or by resolutions adopted by the Board, the Committee shall have sole and complete authority and discretion
		
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	to select Participants and grant Options,

		
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	to determine the form and content of Options to be issued in the form of Agreements under the Plan,

		
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	to interpret the Plan,

		
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	to prescribe, amend and rescind rules and regulations relating to the Plan, and

		
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	to make other determinations necessary or advisable for the administration of the Plan.

The Committee shall have and may exercise such other power and authority as may be delegated to it by the Board from time to time.  A majority of the entire Committee shall constitute a quorum and the action of a majority of the members present at any meeting at which a quorum is present, or acts approved in writing by a majority of the Committee without a meeting, shall be deemed the action of the Committee.
(c)    Agreement.  Each Option shall be evidenced by a written agreement containing such provisions as may be approved by the Committee.  Each such Agreement shall constitute a binding contract between the Company and the Participant, and every Participant, upon acceptance of such Agreement, shall be bound by the terms and restrictions of the Plan and of such Agreement.  The terms of each such Agreement shall be in accordance with the Plan, but each Agreement may include such additional provisions and restrictions determined by the Committee, in its discretion, provided that such additional provisions and restrictions are not inconsistent with the terms of the Plan.  In particular, the Committee shall set forth in each Agreement:
		
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	the Exercise Price of an Option,

		
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	the number of Shares subject to, and the expiration date of, the Option,

		
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	the manner, time and rate (cumulative or otherwise) of exercise or vesting of such Option, and

		
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	the restrictions, if any, to be placed upon such Option, or upon Shares which may be issued upon exercise of such Option.

The Chairman of the Committee and such other officers as shall be designated by the Committee are hereby authorized to execute Agreements on behalf of the Company and to cause them to be delivered to the recipients of Options.
(d)    Effect of the Committee’s Decisions.  All decisions, determinations, and interpretations of the Committee shall be final and conclusive on all persons affected thereby.
(e)    Indemnification.  In addition to such other rights of indemnification as they may have, the members of the Committee shall be indemnified by the Company in connection with any claim, action, suit or proceeding relating to any action taken or failure to act under or in connection 

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with the Plan or any Option, granted hereunder to the full extent provided for under the Company’s Articles of Incorporation or Bylaws with respect to the indemnification of Directors.
6.    Grant of Options.
(a)    General Rule.  The Committee, in its sole discretion, may grant ISOs or Non-ISOs to Employees of the Company, the Bank or its Affiliates and may grant Warrants and other Non-ISOs to Directors, Bank Directors or directors of Affiliates.
(b)    Special Rules for ISOs.  The aggregate Market Value, as of the date the Option is granted, of the Shares with respect to which ISOs are exercisable for the first time by an Employee during any calendar year (under all incentive stock option plans, as defined in Section 422 of the Code, of the Company or any present or future “parent” or “Subsidiary” of the Company) shall not exceed $100,000.  Notwithstanding the prior provisions of this paragraph, the Committee may grant Options in excess of the foregoing limitations, in which case such Options granted in excess of such limitation shall be Options which are Non-ISOs.
7.    Exercise Price for Options.
(a)    Limits on Committee Discretion.  The Exercise Price as to any particular Option granted under the Plan shall not be less than the Market Value of the Optioned Shares on the date of grant.  In the case of an Employee who owns Shares representing more than 10% of the Company’s Outstanding Shares of Common Stock at the time an ISO is granted, the Exercise Price shall not be less than 110% of the Market Value of the Optioned Shares at the time the ISO is granted.
(b)    Standards for Determining Exercise Price.  If the Common Stock is listed on a national securities exchange (including the NASDAQ National Market) on the date in question, then the Market Value per Share shall be not less than the average of the highest and lowest selling price on such exchange on such date, or if there were no sales on such date, then the Exercise Price shall be not less than the mean between the bid and asked prices on such date.  If the Common Stock is traded otherwise than on a national securities exchange on the date in question, then the Market Value per Share shall be not less than the mean between the bid and asked price on such date, or, if there is no bid and asked price on such date, then on the next prior business day on which there was a bid and asked price.  If no such bid and asked price is available, then the Market Value per Share shall be its fair market value as determined by the Committee, in good faith, in its sole and absolute discretion.
8.    Exercise of Options.
(a)    Generally.  Any Option shall be exercisable at such times and under such conditions as shall be permissible under the terms of the Plan and of the Agreement.  An Option may not be exercised for a fractional Share.
(b)    Procedure for Exercise.  A Participant may exercise Options, subject to provisions relative to its termination and limitations on its exercise, only by delivering to the Company, prior to the termination of such option:

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	written notice of intent to exercise the Option with respect to a specified number of Shares, and

		
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	payment to the Company (contemporaneously with delivery of such notice) in cash, in Common Stock, or a combination of cash and Common Stock, of the amount of the Exercise Price for the number of Shares with respect to which the Option is then being exercised.

Each such notice (including required payment) shall be delivered, or mailed by prepaid registered or certified mail, addressed to the Treasurer of the Company at the Company’s executive offices.  Common Stock utilized in full or partial payment of the Exercise Price for Options shall be valued at its Market Value at the date of exercise.
(c)    Period of Exercisability.  An Option may be exercised by a Participant only while the Participant is an Employee or member of the Board or Bank Board and has maintained Continuous Service from the date of the grant of the Option, or within three months after termination of such Continuous Service (but not later than the date on which the Option would otherwise expire), except if the Participant’s Continuous Service terminates by reason of:
		
	(1)
	Just Cause, in which case the Participant’s rights to exercise such Option shall expire on the date of such termination of Continuous Service;

		
	(2)
	death, in which case, to the extent that the Participant would have been entitled to exercise the Option immediately prior to his death, such Option of the deceased Participant may be exercised within two years from the date of his death (but not later than the date on which the Option would otherwise expire) by the personal representatives of his estate or person or persons to whom his rights under such Option shall have passed by will or by laws of descent and distribution;

		
	(3)
	Permanent and Total Disability, in which case, to the extent that the Participant would have been entitled to exercise the Option immediately prior to his Permanent and Total Disability, such Option may be exercised within one year from the date of such Permanent and Total Disability, but not later than the date on which the Option would otherwise expire;

		
	(4)
	In the case of a Participant who is a member of the Board or Bank Board, removal from the Board or the Bank Board pursuant to the respective Articles of Incorporation, in which case the Participant’s rights to exercise such Non-ISO shall expire on the date of such removal.

(d)    Notwithstanding the provisions of any Option that provides for its exercise in installments as designated by the Committee, such Option shall become immediately exercisable upon the Participant’s death or Permanent and Total Disability.

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(e)    Effect of the Committee’s Decisions.  The Committee’s determination whether a Participant’s Continuous Service has ceased, and the effective date thereof shall be final and conclusive on all persons affected thereby.
9.    Conditions Upon Issuance of Shares.
(a)    Compliance with Securities Laws.  Shares of Common Stock shall not be issued with respect to any Option unless the issuance and delivery of such Shares shall comply with all relevant provisions of law, including, without limitation, the Securities Act of 1933, as amended, the rules and regulations promulgated thereunder, any applicable state securities law, and the requirements of any stock exchange upon which the Shares may then be listed.
(b)    Special Circumstances.  The inability of the Company to obtain approval from any regulatory body or authority deemed by the Company’s counsel to be necessary to the lawful issuance and sale of any Shares hereunder shall relieve the Company of any liability in respect of the non-issuance or sale of such Shares.  As a condition to the exercise of an Option, the Company may require the person exercising the Option to make such representations and warranties as the Committee determines may be necessary to assure the availability of an exemption from the registration requirements of federal or state securities law.
(c)    Committee Discretion.  The Committee shall have the discretionary authority to impose in Agreements such restrictions on Shares as it may deem appropriate or desirable, including but not limited to the authority to impose a right of first refusal or to establish repurchase rights or both of these restrictions.
10.    Restrictions on Sale of Shares.
(a)    Other Restrictions.  In connection with any Agreement the Committee, in its sole discretion, may include as a term of any Option the right of the Company but not the obligation, to repurchase all or any amount of the Shares acquired by an Optionee pursuant to the exercise of any such Options (the “Repurchase Right”).  The intent of the Repurchase Right is to encourage the continued employment of the Optionee.  The Repurchase  Right shall provide for, among other things, a specified duration of the Repurchase Right, a specified price per Share to be paid upon the exercise of the Repurchase Right and a restriction on the disposition of the Shares by the Optionee during the period of the Repurchase Right.  The Repurchase Right may permit the Company to transfer or assign such right to another party.  The Company may exercise the Repurchase Right only to the extent permitted by applicable  law.
(b)    Legends.  The Company shall be entitled to note any restrictions on transfer, including any restrictions arising as a result of state or federal securities laws, in its transfer records, and to inscribe on each share certificate representing Shares issued upon the exercise of Options a legend noting such restrictions.
11.    Effect of Changes in Control and Changes in Common Stock Subject to the Plan.
(a)    Effects of Change in Control.

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	(1)
	Notwithstanding the provisions of any Option that provides for its exercise or vesting  in installments, all Options shall be immediately exercisable and fully vested upon a Change in Control.

		
	(2)
	At the time of a Change in Control which does not constitute a Transaction, at the sole and absolute discretion of the Committee, any or all outstanding Options may be cancelled, in exchange for which cancellation the Participant shall receive a cash payment in an amount equal to the excess of the Market Value at the time of the Change in Control of the Shares subject to such Option over the Exercise Price of such Options, provided that in no event may an Option be cancelled in exchange for cash pursuant to this paragraph (a)(2) within the six-month period following the date of its grant.

		
	(3)
	In the event there is a Transaction, all outstanding Options shall be surrendered.  With respect to each Option so surrendered, the Committee shall in its sole and absolute discretion determine whether  the holder of each Option so surrendered shall receive:

(A)    for each Share then subject to an outstanding Option, an Option for the number and kind of shares into which each Outstanding Share (other than Shares held by dissenting stockholders) is changed or exchanged, together with an appropriate adjustment to the Exercise Price; or
(B)    the number and kind of shares into which each Outstanding Share (other than Shares held by dissenting stockholders) is changed or exchanged in the Transaction that are equal in market value to the excess of the Market Value on the date of the Transaction of the Shares subject to the Option, over the Exercise Price of the Option; or
(C)    a cash payment (from the Company or the successor corporation), in an amount equal to the excess of the Market Value on the date of the Transaction of the Shares subject to the Option, over the Exercise Price of the Option.
(b)    Recapitalizations; Stock Splits, Etc.  The number and kind of shares reserved for issuance under the Plan, and the number and kind of shares subject to outstanding Options and the Exercise Price thereof, shall be proportionately adjusted for any increase, decrease, change or exchange of Shares for a different number or kind of shares or other securities of the Company which results from a merger, consolidation, recapitalization, reorganization, reclassification, stock dividend, split-up, combination of shares, or similar event in which the number or kind of shares is changed without the receipt or payment of consideration by the Company.
(c)    Special Rule for ISOs.  Any adjustment made pursuant to subparagraphs (a)(3)(A) or (b) of this Paragraph shall be made in such a manner as not to constitute a modification, within the meaning of Section 424(h) of the Code, of outstanding  ISOs.

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(d)    Conditions and Restrictions on New, Additional, or Different Shares or Securities.  If, by reason of any adjustment made pursuant to this section, a Participant becomes entitled to new, additional, or different shares of stock or securities, such new, additional, or different shares of stock or securities shall thereupon be subject to all of the conditions and restrictions which were applicable to the Shares pursuant to the Option before the adjustment was made.
(e)    Other Issuances.  Except as expressly provided in this section, the issuance by the Company or an Affiliate of shares of stock of any class, or of securities convertible into Shares or stock of another class, for cash or property or for labor or services either upon direct sale or upon the exercise of rights or warrants to subscribe therefor, shall not affect, and no adjustment shall be made with respect to, the number, class, or Exercise Price of Shares then subject to Options or reserved for issuance under the Plan.
12.    Non-Transferability of Options.
(a)    ISOs may not be sold, pledged, assigned, hypothecated, transferred or disposed of in any manner other than by will or by the laws of descent and distribution.
(b)    Non-ISOs may not be sold, pledged, assigned, hypothecated, transferred or disposed of in any manner other than by will or by the laws of descent and distribution, pursuant to the terms of a “qualified domestic relations order” (within the meaning of Section 4 l 4(p) of the Code and the regulations and rulings thereunder).
13.    Time of Granting Options.  The date of grant of an Option shall, for all purposes, be the later of the date on which the Committee makes the determination of granting such Option and  the Effective Date.  Notice of the determination shall be given to each Participant to whom an Option is so granted within a reasonable time after the date of such grant.
14.    Effective Date.  The Plan shall be effective as of April l 0, 2002 (date of Board approval).  Option grants may be made prior to approval of the Plan by the stockholders of the Company, if the exercise of Options is conditioned upon stockholder approval of the Plan.
15.    Approval by Stockholders.  The Plan shall be approved by stockholders of the Company within twelve (12) months before or after the Effective Date.
16.    Modification of Options.  At any time, and from time to time, the Board may authorize the Committee to direct execution of an instrument providing for the modification of any outstanding Option, provided no such modification shall confer on the holder of said Option any right or benefit which could not be conferred on him by the grant of a new Option at such time, or impair the Option without the consent of the holder of the Option.
17.    Amendment and Termination of the Plan.  The Board may from time to time amend the terms of the Plan and, with respect to any Shares at the time not subject to Options, suspend or terminate the Plan; provided that shareholder approval shall be required to increase the number of Shares subject to the Plan provided in Paragraph 4 or to extend the terms of the Plan.  No amendment, 

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suspension, or termination of the Plan shall, without the consent of any affected holders of an Option, alter or impair any rights or obligations under any Option theretofore granted.
18.    Reservation of Shares.  The Company, during the term of the Plan, will reserve and keep available a number of Shares sufficient to satisfy the requirements of the Plan.
19.    Withholding Tax.  The Company’s obligation to deliver Shares upon exercise of Options (or such earlier time that the Participant makes an election under Section 83(b) of the Code) shall be subject to the Participant’s satisfaction of all applicable federal, state and local income and employment tax withholding obligations arising from the exercise of options.  The Committee, in its discretion, may permit the Participant to satisfy the obligation, in whole or in part, by irrevocably electing to have the Company withhold Shares, or to deliver to the Company Shares that he already owns, having a value equal to the amount required to be withheld.  The value of Shares to be withheld, or delivered to the Company, shall be based on the Market Value of the Shares on the date the amount of tax to be withheld is to be determined.  As an alternative, the Company may retain, or sell without notice, a number of such Shares sufficient to cover the amount required to be withheld.
20.    No Employment or Other Rights.  In no event shall a Director’s or Employee’s eligibility to participate or participation in the Plan create or be deemed to create any legal or equitable right of the Director or Employee or any other party to continue service with the Company, the Bank, or any Affiliate of such corporations.  No Director or Employee shall have a right to be granted an Option or, having received an Option, the right to be granted an additional Option.
21.    Governing Law.  The Plan shall be governed by and construed in accordance with the laws of the State of Maryland, except to the extent that federal law shall be deemed to apply.

10Exhibit

                                            

Option Agreement Number

STOCK OPTION AGREEMENT
(For incentive stock options)

This STOCK OPTION AGREEMENT is made and entered into as of this 31st day of December, 20__, between Capital Bancorp, Inc., a Maryland corporation (the “Company”) and __________ (“Participant”).

WHEREAS the Company desires to grant the Participant certain options to purchase shares of the Company’s common stock (“Common Stock”) pursuant to the Company’s 2002 Stock Option Plan (the “2002 Plan”), as approved by the stockholders.

WHEREAS the parties enter into this agreement (the “Agreement”) to evidence the grant of such stock options and set forth the terms and conditions governing their exercise.

NOW, THEREFORE, the parties agree as follows:

1. Grant of Options.  The Company grants to Participant an option (the “Stock Options”) to purchase an aggregate of ______ shares of Common Stock.  The Stock Options shall constitute “incentive stock options” within the meaning of Section 422 of the Internal Revenue Code of 1954, as amended, to the extent that the Market Value of Common Stock with respect to which incentive stock options are exercisable for the first time by the Participant during any calendar year (under all plans of the Company) exceeds $100,000, such options shall be treated as options which are not incentive stock options.

2. Exercise Price.  The exercise price of the Stock Options is _______ dollars ($____) per share (the “Exercise Price”).

3. Term.  Subject to each and every one of the conditions and limitations set forth in the 2002 Plan, including but not limited to the termination of stock options in the event that the Participant ceases to be an employee of the Company or its wholly-owned subsidiary, Capital Bank N.A., the Stock Options that have vested may be exercised by the Participant, in whole or in part, at any time period commencing during the period beginning on the date hereof and terminating on December 31, 20__.  Any of the Stock Options that are outstanding and unexercised at the close of business on December 31, 20__ shall automatically, and without further action by the Company or the Participant, be canceled or terminated.

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4. Exercise.  The Stock Options may be exercised, in whole or in part, by delivery of written notice to the Chairman of the Board of the Company or their designee by the Participant, indicating the number of the Stock Options that the Participant wishes to exercise.  Such notice shall be accompanied by the payment of the Exercise Price for the total number of share of Common Stock being purchased by the Participant pursuant to the exercise of all or any portion of the Stock Options. The Exercise Price shall be paid in cash (U.S. dollars).

5. Vesting.  Stock Options granted under this Agreement vest as follows:  In the event that the Stock Options have not been terminated as a result of the Participant ceasing to be an Employee of the Company or its wholly-owned subsidiary, Capital Bank, N.A., then 25% of the Stock Options granted herein vest on December 31, 20__, 50% on December 31, 20__, 75% on December 31, 20__ and 100% on December 31, 20__.

6. Delivery of Certificate.  As soon as practicable following the exercise of the Stock Options by the Participant, the Company shall deliver or cause to be delivered to the Participant a certificate representing the share of Common Stock acquired pursuant to any such exercise.

7. Investment.  The Participant hereby represents and warrants to the Company that any and all shares of Common Stock which shall be acquired pursuant to the exercise of the Stock Options shall be acquired for the Participant’s own account, for investment, and not with a view toward resale.

8. Arrangement of Tax Payment.  The Participant shall make arrangements required by the Company to insure that the amount of tax required to be withheld, if any, by the Company as a result of the exercise of the Stock Options is available for payment.

9. Non-assignability.  The Stock Options granted hereby are not transferable except by will or the laws of descent or distribution and are exercisable during the Participant’s lifetime only by the Participant.

10. Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of Maryland.

11. Entire Agreement.  This Agreement constitutes the entire agreement among the parties hereto with respect to the subject matter hereof and supersedes all prior agreements, understandings and arrangements, both oral and written, between the parties hereto with respect to such subject matter.  This Agreement may not be amended or modified in any way unless by a written instrument executed by each of the parties hereto.

12. Benefits; Binding Effect.  This Agreement shall ensure to the benefit of and shall be binding upon the parties hereto and their respective heirs, representatives, successors and assigns.

13. Section Headings.  The section headings contained in this Agreement are for reference purposes only and shall not in any way affect the meaning or interpretation hereof.

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14. Counterparts.  This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which shall be deemed to be an original and all of which shall be deemed to be one and the same instrument.

IN WITNESS HEREOF, the parties have executed and delivered this Agreement as of the date first above written.

Capital Bancorp, Inc.

		
	By:
	_______________________

Edward Barry, CEO

Attested by:

________________________

PARTICIPANT:

By:     ___________________________    
          NAME OF PARTICIPANT

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