10-K

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington D.C. 20549

FORM 10-K

þAnnual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the fiscal year ended October 31, 2005 Commission File Number 002-50219

Metrocorp, Inc.

(Exact name of Registrant as specified in its charter)

Illinois	36-2786335
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)

1523 8th Street, East Moline, Illinois		61244
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (309) 755-0671

Securities registered pursuant to Section 12(b) of the Exchange Act: None

Securities registered pursuant to Section 12(g) of the Act: See below

Title of Each Class	Name of Exchange on Which Registered
Common stock ($0.20 par value)	None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

YES o            NO þ

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

YES þ            NO o

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter periods that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

YES o            NO þ

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of the Form 10-K or any amendment to the Form 10-K.þ

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act (check one).
Large accelerated filer o           Accelerated filer o            Non-accelerated filer þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 126-2 of the Exchange Act).

YES o            NO þ

The aggregate market value of the common stock held by non-affiliates of the Registrant, as of April 30, 2005, the last business day of the registrant’s most recently completed second fiscal quarter, was approximately $42,215,000. This computation excludes a total of 80,951 shares which are beneficially owned by the officers and directors of Registrant who may be deemed to be the affiliates of Registrant under applicable rules of the Securities and Exchange Commission.

The number of shares outstanding of Registrant’s classes of common stock, as of February 20, 2006, was 1,186,068 shares of Common Stock, $0.20 par value.

The following documents are incorporated herein by reference into the parts of Form 10-K indicated: None.

TABLE OF CONTENTS

	Page
FORWARD LOOKING STATEMENTS		1
PART I		1
ITEM 1. BUSINESS		1
ITEM 1A. RISK FACTORS		9
ITEM 2. PROPERTIES		16
ITEM 3. LEGAL PROCEEDINGS		17
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS		17
PART II		17
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES		17
ITEM 6. SELECTED FINANCIAL DATA		20
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		21
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK		38
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA		42
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE		42
ITEM 9A. CONTROLS AND PROCEDURES		42
ITEM 9B. OTHER INFORMATION		42
PART III		42
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT		42
ITEM 11. EXECUTIVE COMPENSATION		45
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS		47
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS		48
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES		49
PART IV		50
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES		50
SIGNATURES		52
Audited consolidated financial statements		F-1
Exhibits
Articles of Incorporation
Bylaws
Amended and Restated Trust Agreement
Subordinated Loan Agreement
Guarantee Agreement
Form of Trust Preferred Certificate
Form of Indemnification Agreement
Form of Incentive Bonus Agreement
Change of Control Severance Plan
Stay Bonus Plan
Renewal of Lease Agreement
Replacement Revolving Note
Loan Agreement
Code of Ethics
Code of Business Conduct
Rule 13a-14(a)/15d-14(a) Certification of CEO
Rule 13a-14(a)/15d-14(a) Certification of CFO
Section 1350 Certification of CEO
Section 1350 Certification of CFO
Charter of Audit Committee

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FORWARD LOOKING STATEMENTS

This Annual Report on Form 10-K contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 about Metrocorp, Inc. for which it claims the protection of the safe harbor provisions contained in the Private Securities Litigation Reform Act of 1995. Actual results could differ materially from those projected in the forward-looking statements as a result of the risks and uncertainties set forth in this report, and other reports and documents that Metrocorp files with the Securities and Exchange Commission. The information set forth is not a guarantee of future performance, operating results or financial condition. These forward-looking statements are based on management’s current knowledge and belief and include information concerning Metrocorp’s possible or assumed future financial condition and results of operations. A number of factors, some of which are beyond Metrocorp’s ability to predict or control, could cause future results to differ materially from those contemplated. These factors are described as “Risk Factors” in Item 1A below. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements.

PART I

ITEM 1. BUSINESS

History and Business

Metrocorp, Inc. (the “Company” or “Metrocorp”) was formed in 1973 (as Middle States Bancorporation) as a Delaware corporation for the purpose of acting as a bank holding company for its wholly owned subsidiary, Metrobank, NA. It is registered as a bank holding company with the Board of Governors of the Federal Reserve System. On March 15, 2004, Metrocorp was reincorporated as an Illinois corporation. Metrobank was founded in 1904 as The State Bank of East Moline and is the oldest locally owned community bank in the greater Quad Cities market. In 1987 the bank was renamed Metrobank and the holding company was renamed Metrocorp. Metrocorp became a national bank in 1997.

Metrobank currently operates a main office, 18 branch offices, an operations office and an office for Community Insurance which are located in the Quad Cities market, western Illinois and eastern Iowa. The Quad Cities area consists of five cities, two counties and outlying areas. The major cities include Rock Island, Moline and East Moline in Illinois and Davenport and Bettendorf in Iowa. Outlying areas include Milan, Hampton and Rapids City in Rock Island County, Illinois; five locations in Jackson and Clinton counties, Iowa; and three locations in Carroll and Whiteside counties, Illinois. The Quad Cities’ location along the Mississippi River supports industrial and freight transportation economies in addition to a strong agricultural base. Metrobank has established a network of 48 ATMs in western Illinois and eastern Iowa.

Metrobank is a full service community bank that specializes in business and individual banking. In addition to traditional banking services such as savings and checking accounts, it offers trust services, discount brokerage services, electronic services, internet banking and insurance products. Metrobank also offers a variety of debit and credit card programs, including affinity credit card programs with local schools and a secured credit card program. Finally, Metrobank offers investment services through its affiliation with Primevest Financial Services, a registered broker/dealer. Through Primevest, Metrobank customers have access to self-directed IRAs, SEP IRAs, simple IRAs, 401(k) retirement plans, stocks, bonds, mutual funds and other products.

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Lending Activities

Metrobank provides a wide range of the usual and customary commercial and consumer banking products and services including commercial, agricultural, student, real estate and consumer loans and trust services. Metrobank also participates in a variety of government-supported residential lending programs. Metrobank’s primary market is small- to medium-sized businesses and consumers in the Quad Cities market.

The principal economic risks associated with the lending activities of Metrobank are the creditworthiness of any proposed borrower, a borrower’s ability to repay loans and the value of collateral securing any given loan. General factors that affect a commercial or consumer borrower’s ability to repay loans include interest, inflation and employment rates, as well as other factors affecting a particular borrower’s assets, such as employment, cash flows and other financial obligations. In many cases, these customers are less able to withstand competitive, economic and financial pressures than are larger borrowers. During periods of economic weakness, these businesses and individuals may become more adversely affected than larger entities, and may cause increased levels of non-accrual loans, loan charge-offs, foreclosures and higher provisions for loan losses.

Metrobank’s lending activities comprise six principal lending areas: real estate, agricultural production, installment, commercial, student and other. Although Metrobank’s business is not seasonal and does not depend upon one or a few major customers, a substantial percentage of Metrobank’s loans are secured by real estate. At October 31, 2005, approximately 58.5% of Metrobank’s total loans were secured by real estate, compared to 54.9% as of October 31, 2004. As a result, risk of nonpayment or default may not be well-spread across diversified borrowing groups. In addition, a general downturn in the western Illinois and eastern Iowa economies that impairs the value of real estate as collateral can increase loan losses and impair liquidity.

Commercial loans are generally secured by business assets, including equipment and real estate. Other commercial loans may be secured by accounts receivable and inventory. Installment loans are sometimes unsecured, but also may be secured by personal assets such as vehicles. Generally, an economic downturn, such as the recessionary forces that impacted the national, regional, western Illinois and eastern Iowa economies in recent years, can increase the risk of nonpayment, default and foreclosure of collateral securing loans. Installment loans are subject to a greater risk of personal bankruptcies during less prosperous economic times.

Metrobank’s disciplined credit underwriting and loan administration and attention to maintaining sound asset quality is one of the ways Metrobank tries to mitigate the inherent risks of lending. As another mitigating factor, Metrobank’s loan policy permits the purchase and sale of loans by participation in order to manage assets and liabilities and diversify risk. For a more complete discussion of Metrobank’s efforts to mitigate risk, please see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Asset Quality.”

Other Activities

Metrobank also operates through its wholly owned subsidiary, Community Insurance, Inc. Community Insurance was acquired in November 2001 from Chadwick Bancshares, Inc. The agency was formed in September 1994 as an Iowa corporation to provide personal, business and crop-related insurance products to customers. It is based in Miles, Iowa. Metrocorp Capital Trust I (the “Trust”) is a wholly owned non-consolidated subsidiary of Metrocorp and was formed as a special purpose Delaware business trust in November 2001. The Trust was formed for the purpose of issuing Company Obligated Mandatorily Redeemable Preferred Securities (“Trust Preferred Securities”). The Trust is authorized only to issue the Trust Preferred Securities and to invest the proceeds in Junior Subordinated Debentures

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of Metrocorp, issued concurrently with the Trust’s issuance of the Trust Preferred Securities, which is described in more detail under Item 5 of this report. The Trust conducts no other business.

Employees

Metrobank has 171 full-time employees and approximately 50 part-time employees. Metrobank maintains a 401(k) salary reduction plan covering substantially all employees of Metrobank which is described in more detail under “Executive Compensation” in this report. The Company is not a party to any collective bargaining agreement and has good relations with its employees. Metrobank provides customary insurance benefits to its employees. In addition, Metrobank formalized a Retiree Medical Plan on October 20, 2003, which provides Medicare supplement benefits and limited prescription medication benefits to retired employees and their spouses. Metrocorp maintained a noncontributory employee stock ownership plan which it terminated in November 2004.

Competition

The banking business is highly competitive in the Company’s primary markets of western Illinois and eastern Iowa. Consolidation in the financial services industry has reduced the number of independent banks. Metrobank competes with other commercial banks, savings banks, savings and loan associations, credit unions, finance companies, insurance companies, asset-based non-bank lenders and certain other non-financial institutions. Some of the large major commercial banks are able to finance wide-ranging advertising campaigns and allocate their investment assets to regions of high yield and demand. By virtue of their greater total capitalization, such institutions have substantially higher lending limits and financial resources than does Metrobank.

Metrobank also competes with other non-bank financial markets for funds. Yields on corporate and government debt securities and other commercial paper may be higher than on deposits and therefore affect the ability of commercial banks to attract and hold deposits. Commercial banks also compete for available funds with money market instruments and mutual funds. During past periods of high interest rates, many funds have provided substantial competition to banks for deposits and they may continue to do so in the future. In periods of high stock market growth, mutual funds have become a major source of competition for savings dollars.

In addition, under the Gramm-Leach-Bliley Act, securities firms and insurance companies that elect to become financial holding companies may acquire banks and other financial institutions. These financial holding companies may offer banking, insurance and securities brokerage products which could significantly change the competitive environment in which Metrocorp operates. In addition, other federal legislation has had the effect of easing membership limits on credit unions and increasing the ability of credit unions to compete with Metrobank for deposits and loans in the communities Metrobank serves.

Nevertheless, Metrobank has been able to effectively distinguish itself as a community bank and compete by emphasizing customer service and responsive decision-making, by establishing long-term customer relationships and loyalty and by providing products and services designed to meet the specific needs of customers. Metrocorp believes its competitive strengths, including its reputation for developing and continuing banking relationships, responsiveness to customer needs and individualized customer service will enable it to continue to successfully compete in the communities it serves.

Regulation and Supervision

Bank holding companies and banks are regulated extensively under both federal and state law. The following information describes some but not all of the applicable statutory and regulatory provisions,

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and is qualified in its entirety by reference to the particular statutory and regulatory provisions. Any change in applicable law or regulation may have a material effect on the business of Metrocorp and Metrobank, including increasing the cost of doing business, limiting permissible activities or increasing competition.

Metrocorp

As a registered bank holding company under the Bank Holding Company Act of 1956 (the “BHCA”), Metrocorp is subject to the supervision, regulation and examination by the Board of Governors of the Federal Reserve System (“Federal Reserve”). The BHCA requires Metrocorp to file reports with the Federal Reserve and to provide additional requested information.

Restrictions on Dividends. Bank holding companies may pay cash dividends on common stock only if prospective earnings retention is consistent with the organization’s expected capital needs, asset quality and financial condition. Payment of cash dividends also should not impose undue pressure on the capital of subsidiary banks or undermine the bank holding company’s ability to serve as a source of strength to its banking subsidiaries. Under Illinois law, dividends by Metrocorp with respect to its stock are subject to declaration by the Board of Directors at its discretion out of net assets. Dividends cannot be declared and paid when such payment would make Metrocorp insolvent or cause Metrocorp’s net assets to be less than zero or less than the maximum amount payable at the time of distribution to shareholders having preferential rights in liquidation if Metrocorp were then to be liquidated.

Holding Company Activities and Financial Modernization. Bank holding companies must receive the approval of the Federal Reserve before they may acquire all or substantially all of the assets of any bank or ownership or control of more than five percent of the voting shares of any bank. With certain limited exceptions, bank holding companies and banks are prohibited from acquiring direct or indirect ownership or control of any voting shares of any company which is not a bank or from engaging in any activities other than those of banking, managing or controlling banks or furnishing services to its subsidiaries. In addition, bank holding companies are restricted in the underwriting and public sale of securities.

An exception to these prohibitions allows the acquisition of companies whose activities the Federal Reserve has found to be so closely related to banking or managing or controlling banks as to be a proper incident thereto. Some of the activities that have been determined by regulation to be closely related to banking are making or servicing loans, performing certain data processing services, acting as an investment or financial advisor to certain investment trusts and investment companies, and providing securities brokerage services.

The Gramm-Leach-Bliley Act (“GLB”) eliminated the barriers to affiliations among banks, securities firms, insurance companies and other financial service providers and permits bank holding companies to become financial holding companies and join with securities firms and insurance companies and engage in other activities that are financial in nature without Federal Reserve approval. GLB effectively repealed certain depression-era laws which prohibited the affiliation of banks and those other financial services entities under a single holding company. Under GLB, bank holding companies and other types of financial service entities may elect to become financial holding companies. Financial holding companies are permitted to engage in activities considered financial in nature, and other activities that are determined to be incidental or complementary to financial activities and may engage in a broader range of activities than are otherwise permitted for bank holding companies or banks. As a result of the GLB, financial holding companies may offer a variety of financial services, or services incidental or complementary to financial services, including banking, securities underwriting, merchant banking and insurance. These new financial services may also be engaged in by a “financial subsidiary” of a national or state bank, with the exception of insurance or annuity underwriting, insurance company portfolio

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investments, real estate investments and development, and merchant banking, all of which must be conducted under the financial holding company.

A bank holding company may become a financial holding company if each of its subsidiary banks is well-capitalized, well-managed, and has at least a satisfactory rating under the Community Reinvestment Act of 1977 (“CRA”). Activities that are “financial in nature” include securities underwriting, dealing and market making; sponsoring mutual funds and investment companies; insurance underwriting and agency; and merchant banking activities. Subsidiary banks of a financial holding company must remain well-capitalized and well-managed in order to continue to engage in activities that are financial in nature without regulatory actions or restrictions. Metrocorp is not currently a financial holding company and has no current intention to become a financial holding company.

Safe and Sound Banking Practices. Bank holding companies are not permitted to engage in practices the Federal Reserve considers to be unsafe and unsound. In some circumstances, for example, a holding company is required to give the Federal Reserve prior notice of any redemption or repurchase of its own equity securities. The payment of dividends may also constitute an unsafe or unsound banking practice, if, for example, the dividend payment is inconsistent with capital adequacy guidelines. Metrocorp could be subject to assessment to restore the capital of Metrobank should it become impaired. Civil money penalties may also be imposed in some circumstances.

Anti-Tying Restrictions. Bank holding companies and their affiliates are prohibited from tying the provision of certain services, such as extensions of credit, to other nonbanking services offered by a holding company or its affiliates.

Capital Adequacy Requirements. Bank holding companies are subject to the minimum capital requirements of the Federal Reserve. The Federal Reserve has adopted a system using risk-based capital guidelines to evaluate the capital adequacy of bank holding companies. These regulations apply on a consolidated basis to bank holding companies with assets of $150 million or more. For bank holding companies with less than $150 million in assets, the guidelines apply on a bank-only basis. Since Metrocorp has over $150 million in assets, the guidelines apply on a consolidated basis. The guidelines establish minimum capital standards in relation to assets and off-balance sheet exposures as adjusted for credit risk. In addition, banking organizations experiencing internal growth or making acquisitions will be expected to maintain strong capital positions above the minimum supervisory levels. Under the guidelines, specific categories of assets are assigned different risk weights, based generally on their perceived credit risk. These risk weights are multiplied by corresponding asset balances to determine a “risk-weighted” asset base. As a result of these requirements, the growth of Metrocorp’s assets is limited by the amount of its capital. Capital requirements can affect profitability and payment of distributions. In addition, if Metrocorp is unable to increase its assets without violating the capital requirements or is forced to reduce assets, its ability to generate earnings would be impaired. Furthermore, earnings may need to be retained rather than paid as distributions to shareholders.

The guidelines require a minimum total risk-based capital ratio of 8.0%, of which at least 4.0% is required to consist of Tier 1 capital elements. Tier 1 capital generally consists of common equity, minority interests in equity accounts of consolidated subsidiaries and certain perpetual preferred stock (up to 25% of total Tier 1 capital), less intangibles, but does not include unrecognized gains and losses on securities. Tier 2 capital, also known as supplementary capital, includes the allowance for loan losses provided that the allowance does not exceed 1.25% of risk weighted assets; certain perpetual preferred stock and subordinated non-convertible debt and some intermediate perpetual preferred stock. Amounts in excess of these limits may be issued but are not included in the calculation of risk-based capital ratios. As of October 31, 2005, on a consolidated basis, Metrocorp’s ratio of Tier 1 capital to total risk-weighted assets was 14.9% and its ratio of total capital to total risk-weighted assets was 15.7%.

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The Federal Reserve also uses a leverage ratio (Tier 1 capital divided by average total consolidated assets) as an additional tool to evaluate capital adequacy. Certain highly-rated bank holding companies that are not experiencing substantial growth may maintain a minimum leverage ratio of 3.0%, but other bank holding companies are required to maintain a leverage ratio of at least 4.0%. As of October 31, 2005, Metrocorp’s leverage ratio was 8.2%.

Imposition of Liability for Undercapitalized Subsidiaries. Bank regulators are required to take “prompt corrective action” to resolve problems associated with insured depository institutions whose capital declines below certain levels. In the event a depositing institution becomes “undercapitalized,” it must submit a capital restoration plan in which the bank holding company guarantees the subsidiary’s compliance up to a certain specified amount.

Bankruptcy. In the event of a bank holding company’s bankruptcy under Chapter 11 of the U.S. Bankruptcy Code, any deficit under any commitment by the debtor holding company to maintain the capital of an insured depository institution must be cured immediately and will generally have priority over most other unsecured claims.

Securities Laws. Metrocorp’s common stock is not publicly traded, but beginning with this annual report on Form 10-K, Metrocorp is required to file reports with the Commission under [Section 13(a)] of the Security Exchange Act of 1934, as amended (the “Exchange Act”). Copies of our annual report on Form 10-K and all future reports will not be available on our website because they are available free of charge to shareholders by written request to Metrocorp, Inc., Attn: Gary D. Andersen, President, or John R. McEvoy, Jr., Senior Vice President/Controller, at 1523 8th Street, East Moline, IL 61244.

Sarbanes-Oxley Act of 2002. The Sarbanes-Oxley Act was enacted in 2002 to protect investors by improving the accuracy and reliability of corporate disclosures made pursuant to securities laws. The Sarbanes-Oxley Act is applicable to all companies with equity securities registered with the Commission or that file reports under the Exchange Act. This Act includes requirements for the composition and activities of audit committees, additional responsibilities regarding financial statements and disclosure of financial and non-financial information for the principal executive and financial officers of companies, new standards for auditors and regulation of auditors and audits and increased disclosure and reporting obligations for reporting companies and their officers and directors.

Metrobank

Metrobank is a bank organized under the laws of the United States and is subject to supervision and regulation by the Office of the Comptroller of the Currency (“OCC”). The OCC may conduct examinations of, and requires periodic information about, the financial condition, operations, management and intercompany relationships of Metrocorp and Metrobank.

Restrictions on Transactions with Affiliates and Insiders. Regulations promulgated by the OCC limit transactions between Metrobank and Metrocorp and its nonbanking affiliates and also requires certain levels of collateral for loans to affiliated parties. In addition, certain transactions between Metrobank and its affiliates must be on terms substantially the same, or at least as favorable to Metrobank, as those prevailing at the time for comparable transactions with nonaffiliated persons. Restrictions imposing an aggregate limitation on all loans to directors, executive officers, principal shareholders and their related interests (“Insiders”), apply to all insured institutions, their subsidiaries and holding companies. Insiders are subject to enforcement actions for knowingly accepting loans in violation of applicable restrictions.

Restrictions on Distribution of Subsidiary Bank Dividends and Assets. Certain statutory and regulatory requirements such as capital adequacy requirements serve to limit the amount of dividends that may be paid by a bank. For example, a bank cannot pay a dividend if, after paying the dividend, the bank will

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be undercapitalized. The OCC may declare a dividend payment to be unsafe and unsound even though the bank would continue to meet its capital requirements after the dividend. Approval by the OCC is required prior to payment of a dividend if the total of all dividends declared by a national bank exceeds its current net profits and prior two years’ retained net profits. “Net profits” is net income less any dividends paid during that period.

Examinations. The OCC periodically examines and evaluates Metrobank. The OCC may revalue the assets of Metrobank and require that it establish specific reserves to compensate for the difference between the OCC-determined value and the book value of such assets.

Capital Adequacy Requirements. A national bank is subject to capital adequacy requirements similar to the capital adequacy requirements of a bank holding company, including the requirement of a total risk-based capital ratio of 8.0%, (4.0% of which consists of Tier 1 capital elements). To be categorized as “well capitalized” under prompt corrective action regulations, Tier 1 capital to risk-based assets must be 6%, total capital to risk-based assets must be 10%, and the leverage ratio must be 4%. At October 31, 2005, Metrobank’s Tier 1 capital to risk-weighted assets ratio was 15.3%, total capital to risk-weighted assets ratio was 16.1% and its leverage ratio was 8.4%.

Corrective Measures for Capital Deficiencies. The federal banking regulators are required to take “prompt corrective action” with respect to capital-deficient institutions. The Federal Deposit Insurance Corporation Improvement Act of 1991 (“FDICIA”) established five tiers of capital adequacy: “well capitalized,” “adequately capitalized,” “undercapitalized,” “significantly undercapitalized” and “critically undercapitalized.” In addition to requiring undercapitalized institutions to submit a capital restoration plan, agency regulations contain broad restrictions on certain activities of undercapitalized institutions including asset growth, acquisitions, branch establishment and expansion into new lines of business. With certain exceptions, an insured depository institution is prohibited from making capital distributions, including dividends, and is prohibited from paying management fees to control persons if the institution would be undercapitalized after any such distribution or payment.

As an institution’s capital decreases, the OCC’s enforcement powers become more severe. A significantly undercapitalized institution is subject to mandated capital-raising activities, restrictions on interest rates paid and transactions with affiliates, removal of management and other restrictions. Critically undercapitalized institutions are subject to appointment of a receiver or conservator. In the event an institution is deemed significantly undercapitalized, it may be required to sell stock, merge, be acquired, restrict transactions with affiliates, restrict interest rates paid on deposits, divest a subsidiary or dismiss officers and directors. If the institution is a bank holding company, it may be prohibited from making capital distributions without OCC approval and may have to divest a subsidiary. A critically undercapitalized institution is generally prohibited from making payments on subordinated debt and may not, without OCC approval, enter into a material transaction other than in the ordinary course of business, engage in any covered transaction or pay excessive compensation or bonuses. Banks with risk-based capital and leverage ratios below the required minimums may also be subject to certain administrative actions, including the termination of deposit insurance upon notice and hearing, or a temporary suspension of insurance without a hearing in the event the institution has no tangible capital. No sanctions apply to “well” or “adequately” capitalized institutions. Metrobank currently is classified as “well capitalized.”

Deposit Insurance Assessments. Metrobank’s deposit accounts are insured up to a maximum of $100,000 per depositor by the FDIC. The FDIC issues regulations and generally supervises the operations of its insured banks. This supervision and regulation is intended primarily for the protection of depositors, not shareholders. Metrobank must pay assessments to the FDIC for federal deposit insurance protection. The FDIC has adopted a risk-based assessment system whereby FDIC-insured depository institutions pay insurance premiums at rates based on their risk classification. An institution’s

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risk classification is assigned based on its capital levels and the level of supervisory concern the institution poses to the regulators.

Enforcement Powers. The FDIC, the OCC and the other federal banking agencies have broad enforcement powers, including the power to terminate deposit insurance, impose substantial fines and other civil and criminal penalties and appoint a conservator or receiver if any one or more of a number of circumstances exist, including, without limitation, the fact that the banking institution is undercapitalized and has no reasonable prospect of becoming adequately capitalized; fails to become adequately capitalized when required to do so; fails to submit a timely and acceptable capital restoration plan; or materially fails to implement an accepted capital restoration plan. The OCC also has the power to impose orders, remove officers and directors, impose fines and appoint supervisors and conservators.

Community Reinvestment Act. The CRA and the corresponding regulations are intended to encourage banks to help meet the credit needs of their service area, including low and moderate income neighborhoods, consistent with the safe and sound operations of the bank. These regulations also provide for regulatory assessment of a bank’s record in meeting the needs of its service area when considering applications to establish branches, merger applications and applications to acquire the assets and assume the liabilities of another bank. Federal banking agencies are required to make public a rating of a bank’s performance under the CRA. In the case of a bank holding company, the CRA performance record of the banks involved in the transaction are reviewed in connection with the filing of an application to acquire ownership or control of shares or assets of a bank or to merge with any other bank holding company. An unsatisfactory record can substantially delay or block the transaction.

Privacy. Under the GLB, financial institutions are required to disclose their policies for collecting and protecting confidential information. Customers are able to prevent financial institutions from sharing personal financial information with non-affiliated third parties, exempting third parties that market the institution’s own products and services. In addition, financial institutions are prohibited from disclosing consumer account numbers to any nonaffiliated third parties for use in telemarketing, direct mail marketing or electronic mail marketing to consumers.

USA PATRIOT Act. The Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (“USA PATRIOT”) Act was enacted in 2001. The potential impact of the Act on financial institutions is significant and wide ranging. In general, the USA PATRIOT Act prohibits specified financial transactions and account relationships and requires enhanced due diligence and “know your customer” standards for financial institutions dealing with foreign financial institutions and foreign customers. In addition, the Secretary of the Treasury is authorized to adopt rules increasing the cooperation and information sharing between financial institutions, regulators, and law enforcement authorities regarding individuals, entities and organizations engaged in, or reasonably suspected of engaging in, terrorist acts or money laundering. Financial institutions complying with these regulations will be not be deemed to have violated the privacy provisions of the GLB discussed above.

Consumer Laws and Regulations. Metrobank is also subject to certain consumer laws and regulations that are designed to protect consumers in transactions with banks, such as the Truth in Lending Act, the Truth in Savings Act, the Electronic Funds Transfer Act, the Expedited Funds Availability Act, the Equal Credit Opportunity Act, the Fair Credit Reporting Act, and the Fair Housing Act.

Recent Developments

In August 2005, National Bancshares, Inc. of Bettendorf, Iowa, made a hostile tender offer to Metrocorp’s shareholders. Although the offer was evaluated and determined to be inadequate, subsequent indications of interest by other local competitors compelled the directors to begin a process to evaluate available strategic alternatives for maximizing shareholder value. As a result of this

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evaluation, Metrocorp engaged Hovde Financial, LLC, as its financial advisor in October 2005. Hovde has been working with the Company to contact potential buyers and to obtain external valuations of Metrocorp. Certain prospective buyers have submitted non-binding indications of interest and are in the process of conducting due diligence procedures. Any sale is subject to entering into a definitive agreement and shareholder and regulatory approvals. In connection with a possible sale, the Company adopted a change in control severance plan and stay bonus plan. These plans are described under Item 11—Executive Compensation of this report and are Exhibits 10.3 and 10.4 to this report.

ITEM 1A. RISK FACTORS

In analyzing whether to make or continue an investment in Metrocorp, investors should consider, among other factors, the following:

The types of loans in our portfolio have a higher degree of credit risk and a downturn in our real estate markets could hurt our business.

We generally invest a greater proportion of our assets in loans secured by commercial real estate, commercial loans and consumer loans than savings institutions that invest a greater proportion of their assets in loans secured by single-family residences. Commercial real estate loans and commercial loans generally involve a higher degree of credit risk than residential mortgage lending due primarily to the large amounts loaned to individual borrowers. Losses incurred on loans to a small number of borrowers could have a material adverse impact on our income and financial condition. In addition, unlike residential mortgage loans, commercial and commercial real estate loans depend on the cash flow from the property or the business to service the debt. Cash flow may be significantly affected by general economic conditions. Consumer lending is riskier than residential mortgage lending because consumer loans are either unsecured or secured by assets that depreciate in value. See Guide 3 Statistical Disclosure by Bank Holding Companies under Item 7 of this report for information as to the percentage of loans invested in commercial real estate, commercial and consumer loans.

In addition, a downturn in our real estate markets could hurt our business because many of our loans are secured by real estate. Real estate values and real estate markets are generally affected by changes in national, regional or local economic conditions, fluctuations in interest rates and the availability of loans to potential purchasers, changes in tax laws and other governmental statutes, regulations and policies and acts of nature. If real estate prices decline, the value of real estate collateral securing our loans could be reduced. Our ability to recover on defaulted loans by foreclosing and selling the real estate collateral would then be diminished and we would be more likely to suffer losses on defaulted loans. As of October 31, 2005, approximately 58.5% of the book value of our loan portfolio consisted of loans collateralized by various types of real estate. Substantially all of our real estate collateral is located in the Quad Cities and surrounding counties in which the Company has locations. If there is a significant decline in real estate values, the collateral for our loans will provide less security. Any such downturn could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Decreasing interest rates could hurt our profits.

Our ability to earn a profit, like that of most financial institutions, depends on our net interest income, which is the difference between the interest income we earn on our interest-earning assets, such as mortgage loans and investments, and the interest expense we pay on our interest-bearing liabilities, such as deposits. Our profitability depends on our ability to manage our assets and liabilities during periods of changing market interest rates. A sustained decrease in market interest rates could adversely affect our earnings. When interest rates decline, borrowers tend to refinance higher-rate, fixed-rate loans at lower rates. Under those circumstances, we would not be able to reinvest those prepayments in assets

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earning interest rates as high as the rates on the prepaid loans on investment securities. In addition, our commercial real estate and commercial loans, which carry interest rates that adjust in accordance with changes in the prime rate, will adjust to lower rates.

An economic downturn in Illinois and Iowa could hurt our profits.

We conduct most of our business in the Quad Cities region of western Illinois and eastern Iowa. As a result of this geographic concentration, our results are affected by the economic conditions in the Quad Cities. Deterioration in economic conditions could result in the following consequences, any of which could have a material adverse effect on our business, financial condition, results of operations and cash flows:

• problem assets and foreclosures may increase,

• demand for our products and services may decline,

• low cost or non-interest bearing deposits may decrease, and

• collateral for loans made by us, especially real estate, may decline in value, in turn reducing customers’ borrowing power, and reducing the value of assets and collateral associated with our existing loans.

In view of the concentration of our operations and the collateral securing our loan portfolio in western Illinois and eastern Iowa, we may be particularly susceptible to the adverse effects of any of these consequences, any of which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Strong competition in Illinois and Iowa could hurt our profits.

Competition in the banking and financial services industry is intense. Our profitability depends upon our continued ability to successfully compete. We compete exclusively in the Quad Cities region of western Illinois and eastern Iowa for loans, deposits and customers with commercial banks, savings and loan associations, credit unions, finance companies, mutual funds, insurance companies, and brokerage and investment banking firms. In particular, our competitors include several major financial companies whose greater resources may afford them a marketplace advantage by enabling them to maintain numerous locations and mount extensive promotional and advertising campaigns. Additionally, banks and other financial institutions with larger capitalization and financial intermediaries not subject to bank regulatory restrictions may have larger lending limits which would allow them to serve the credit needs of larger customers. Areas of competition include interest rates for loans and deposits, efforts to obtain loan and deposit customers and a range in quality of products and services provided, including new technology-driven products and services. Technological innovation continues to contribute to greater competition in domestic and international financial services markets as technological advances enable more companies to provide financial services. We also face competition from out-of-state financial intermediaries that have opened loan production offices or that solicit deposits in our market areas. If we are unable to attract and retain banking customers, we may be unable to continue to maintain our loans and level of deposits and, as such, our business, financial condition, results of operations and cash flows may be adversely affected.

We operate in a highly regulated environment and we may be adversely affected by changes in laws and regulations. Regulations may prevent or impair our ability to pay dividends, engage in acquisitions or operate in other ways.

We are subject to extensive regulation, supervision and examination by the Office of the Comptroller of the Currency (“OCC”), the Federal Deposit Insurance Corporation, and the Board of Governors of the Federal Reserve System. See Item 1—Regulation and Supervision of this report for information on the

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regulation and supervision which governs our activities. Regulatory authorities have extensive discretion in their supervisory and enforcement activities, including the imposition of restrictions on our operations, the classification of our assets and determination of the level of our allowance for loan losses. Banking regulations, designed primarily for the protection of depositors, may limit our growth and the return to you, our investors, by restricting certain of our activities, such as:

• the payment of dividends to its shareholders,

• possible mergers with or acquisitions of or by other institutions,

• desired investments,

• loans and interest rates on loans,

• interest rates paid on deposits,

• the possible expansion of branch offices, and

• the ability to provide securities or trust services.

We also are subject to capitalization guidelines set forth in federal legislation and could be subject to enforcement actions to the extent that we are found by regulatory examiners to be undercapitalized. We cannot predict what changes, if any, will be made to existing federal and state legislation and regulations or the effect that such changes may have on our future business and earnings prospects. Any change in such regulation and oversight, whether in the form of regulatory policy, regulations, legislation or supervisory action, may have a material impact on our operations.

We are exposed to risks in connection with the loans we make.

A significant source of risk for us arises from the possibility that losses will be sustained because borrowers, guarantors and related parties may fail to perform in accordance with the terms of their loans. We have underwriting and credit monitoring procedures and credit policies, including the establishment and review of the allowance for loan losses, that we believe to be appropriate to minimize this risk by assessing the likelihood of nonperformance, tracking loan performance and diversifying our respective loan portfolios. Such policies and procedures, however, may not prevent unexpected losses that could adversely affect our results of operations.

Technological advances impact our business.

The banking industry is undergoing technological changes with frequent introductions of new technology-driven products and services. In addition to improving customer services, the effective use of technology increases efficiency and enables financial institutions to reduce costs. Our future success will depend, in part, on our ability to address the needs of our customers by using technology to provide products and services that will satisfy customer demands for convenience as well as to create additional efficiencies in our operations. Many of our competitors have substantially greater resources than we do to invest in technological improvements. We may not be able to effectively implement new technology-driven products and services or successfully market such products and services to our customers.

Compliance with changing regulation of corporate governance and public disclosure may result in additional risks and expenses.

Changing laws, regulations and standards relating to corporate governance and public disclosure, including the Sarbanes-Oxley Act of 2002 and new Securities and Exchange Commission regulations, are creating uncertainty for registered companies such as Metrocorp. These laws, regulations and standards are subject to varying interpretations in many cases and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies, which could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices. Our efforts to comply with evolving laws,

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regulations and standards are likely to result in increased expenses and a diversion of management time and attention. In particular, our efforts to comply with Section 404 of the Sarbanes-Oxley Act of 2002 and the related regulations regarding management’s required assessment of its internal control over financial reporting and its external auditors’ audit of that assessment will require the commitment of significant financial and managerial resources. We expect these efforts to require the commitment of significant resources. Further, the members of our board of directors, members of our audit or compensation committees, our chief executive officer, our chief financial officer and certain other executive officers could face an increased risk of personal liability in connection with the performance of their duties. It may also become more difficult and more expensive to obtain director and officer liability insurance. As a result, our ability to attract and retain executive officers and qualified board and committee members could be more difficult.

We depend on key personnel and the loss of one or more of those key personnel may materially and adversely affect our prospects.

Competition for qualified employees and personnel in the banking industry is intense and there are a limited number of qualified persons with knowledge of, and experience in, the Quad Cities banking industry and its surrounding market areas. The process of recruiting personnel with the combination of skills and attributes required to carry out our strategies is often lengthy. Our success depends to a significant degree upon our ability to attract and retain qualified management, loan origination, finance, administrative, marketing and technical personnel and upon the continued contributions of our management and personnel. The loss of the services of any one of our senior executive management team or other key executives could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Our balance sheet is liability sensitive. Our business is subject to interest rate risk and variations in interest rates may negatively affect our financial performance.

A substantial portion of our income is derived from the differential or “spread” between the interest earned on loans, securities and other interest-earning assets, and the interest paid on deposits, borrowings and other interest-bearing liabilities. At October 31, 2005, our balance sheet was liability sensitive and, as a result, our net interest margin tends to decrease in a rising interest rate environment and increase in a declining interest rate environment. Because of the differences in the maturities and repricing characteristics of our interest-earning assets and interest-bearing liabilities, changes in interest rates do not produce equivalent changes in interest income earned on interest-earning assets and interest paid on interest-bearing liabilities. Accordingly, fluctuations in interest rates could adversely affect our interest rate spread and, in turn, our profitability. In addition, loan origination volumes are affected by market interest rates. Rising interest rates, generally, are associated with a lower volume of loan originations while lower interest rates are usually associated with higher loan originations. Conversely, in rising interest rate environments, loan repayment rates may decline and in falling interest rate environments, loan repayment rates may increase. Although we have been successful in generating new loans and leases during 2005, the continuation of historically low long-term interest rate levels may cause additional refinancing of commercial real estate and 1-4 family residence loans, which may depress our loan volumes or cause rates on loans to decline. In addition, an increase in the general level of short-term interest rates on variable rate loans may adversely affect the ability of certain borrowers to pay the interest on and principal of their obligations or reduce the amount they wish to borrow. Additionally, as short-term market rates have risen over the past eighteen months, although we have increased the rates we paid on borrowings and other interest-bearing liabilities, we have not proportionally increased interest rates we paid on deposits. If short-term rates continue to rise, in order to retain existing deposit customers and attract new deposit customers we may need to increase rates we pay on deposit accounts. Because we have deferred increasing rates we paid on deposit accounts during a period of rising short-term market rates, we may need to accelerate the pace of rate increases on our

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deposit accounts as compared to the pace of future increases in short-term market rates. Accordingly, changes in levels of market interest rates could materially and adversely affect our net interest spread, asset quality, loan origination volume, business, financial condition, results of operations and cash flows.

If we cannot attract deposits, our growth may be inhibited.

Our ability to increase our assets depends in large part on our ability to attract additional deposits at favorable rates. We intend to seek additional deposits by offering deposit products that are competitive with those offered by other financial institutions in our markets and by establishing personal relationships with our customers. We cannot assure you that these efforts will be successful. Our inability to attract additional deposits at competitive rates could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Our allowance for loan and lease losses may not be adequate to cover actual losses.

A significant source of risk arises from the possibility that losses could be sustained because borrowers, guarantors, and related parties may fail to perform in accordance with the terms of their loans and leases. The underwriting and credit monitoring policies and procedures that we have adopted to address this risk may not prevent unexpected losses that could have a material adverse effect on our business, financial condition, results of operations and cash flows. Unexpected losses may arise from a wide variety of specific or systemic factors, many of which are beyond our ability to predict, influence, or control. Like all financial institutions, we maintain an allowance for loan and lease losses to provide for loan and lease defaults and non-performance. Our allowance for loan and lease losses may not be adequate to cover actual loan and lease losses, and future provisions for loan and lease losses could materially and adversely affect our business, financial condition, results of operations and cash flows. The allowance for loan and lease losses reflects our estimate of the probable losses in our loan and lease portfolio at the relevant balance sheet date. Our allowance for loan and lease losses is based on prior experience, as well as an evaluation of the known risks in the current portfolio, composition and growth of the loan and lease portfolio and economic factors. The determination of an appropriate level of loan and lease loss allowance is an inherently difficult process and is based on numerous assumptions. The amount of future losses is susceptible to changes in economic, operating and other conditions, including changes in interest rates, that may be beyond our control and these losses may exceed current estimates. Federal and state regulatory agencies, as an integral part of their examination process, review our loans and leases and allowance for loan and lease losses. While we believe that our allowance for loan and lease losses is adequate to cover current losses, we cannot assure you that we will not increase the allowance for loan and lease losses further or that regulators will not require us to increase this allowance. Either of these occurrences could have a material adverse affect on our business, financial condition and results of operations.

We rely on communications, information, operating and financial control systems technology from third-party service providers, and we may suffer an interruption in those systems that may result in lost business. We may not be able to obtain substitute providers on terms that are as favorable if our relationships with our existing service providers are interrupted.

We rely heavily on third-party service providers for much of our communications, information, operating and financial control systems technology. Any failure or interruption or breach in security of these systems could result in failures or interruptions in our customer relationship management, general ledger, deposit, servicing and loan origination systems. We cannot assure you that such failures or interruptions will not occur or, if they do occur, that they will be adequately addressed by us or the third parties on which we rely. The occurrence of any failures or interruptions could have a material adverse effect on our business, financial condition, results of operations and cash flows. If any of our third-party service providers experience financial, operational or technological difficulties, or if there is any other

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disruption in our relationships with them, we may be required to locate alternative sources of such services, and we cannot assure you that we could negotiate terms that are as favorable to us, or could obtain services with similar functionality as found in our existing systems without the need to expend substantial resources, if at all. Any of these circumstances could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Our future ability to pay dividends is subject to restrictions. As a result, capital appreciation, if any, of our common stock may be your sole source of gains in the future.

Since we are a holding company with no significant assets other than Metrobank, we currently depend upon dividends from the bank for a substantial portion of our revenues. Our ability to continue to pay dividends in the future will continue to depend in large part upon our receipt of dividends or other capital distributions from Metrobank. The ability of Metrobank to pay dividends or make other capital distributions to us is subject to the regulatory authority of the OCC. As of October 31, 2005, the bank could have paid approximately $2.2 million in dividends without the prior approval of the OCC. The amount that Metrobank may pay in dividends is further restricted due to the fact that the bank must maintain a certain minimum amount of capital to be considered a “well capitalized” institution as further described under Item 1—Metrobank, Capital Adequacy Requirements in this report.

Our holding company expenses and obligations with respect to our trust preferred securities and corresponding junior subordinated deferrable interest debentures issued by us may limit or impair our ability to declare or pay dividends. Finally, our ability to pay dividends is also subject to the restrictions of the Illinois Business Corporations Act.

No trading market exists for our common stock.

Our common stock is not quoted on any exchange or quotation system. Investors must bear the risk of investment for an indeterminate length of time. Even if an active market in our common stock develops, we cannot assure you that such a market will continue or that shareholders will be able to sell their shares.

If we fail to maintain an effective system of internal and disclosure control, we may not be able to accurately report our financial results or prevent fraud. As a result, current and potential shareholders could lose confidence in our financial reporting, which would harm our business and the trading price of our securities.

Effective internal and disclosure controls are necessary for us to provide reliable financial reports and effectively prevent fraud and to operate successfully as a public company. If we cannot provide reliable financial reports or prevent fraud, our reputation and operating results would be harmed. We may discover material weaknesses or significant deficiencies in our internal control as defined under standards adopted by the Public Company Accounting Oversight Board, or PCAOB, that require remediation. Under the PCAOB standards, a “material weakness” is a significant deficiency or combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement of the annual or interim financial statements will not be prevented or detected. A “significant deficiency” is a control deficiency or combination of control deficiencies, that adversely affect a company’s ability to initiate, authorize, record, process, or report external financial data reliably in accordance with generally accepted accounting principles such that there is a more than remote likelihood that a misstatement of a company’s annual or interim financial statements that is more than inconsequential will not be prevented or detected.

As a result of weaknesses that may be identified in our internal control, we may also identify certain deficiencies in some of our disclosure controls and procedures that we believe require remediation. If

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we discover weaknesses, we will make efforts to improve our internal and disclosure control. However, there is no assurance that we will be successful. Any failure to maintain effective controls or timely effect any necessary improvement of our internal and disclosure controls could harm operating results or cause us to fail to meet our reporting obligations. Ineffective internal and disclosure controls could also cause investors to lose confidence in our reported financial information, which would likely have a negative effect on the trading price of our securities.

There is no guarantee that any change of control arrangement will be consummated.

As described at Item 1—Business—Recent Developments, we have engaged a financial adviser to contact potential buyers in connection with a possible change of control. We cannot assure you that any acquisition will be negotiated or, if negotiated, it may not be on terms favorable to the shareholders of Metrocorp.

Directors and officers of Metrocorp have potential conflicts of interest with any acquisition.

The directors and officers of Metrocorp have interests that are different from, or in addition to, the interests of Metrocorp shareholders generally. For example, certain officers have entered into agreements that provide for incentive bonus payments for remaining in Metrocorp’s employ. In addition, Metrocorp has adopted a change of control severance plan. These agreements and plan are described under Item 11—Executive Compensation. These agreements and plan may create potential conflicts of interest and may cause some of these persons to view any proposed change of control transaction differently than you view it.

Anti-takeover provisions, compensation arrangements and federal law may limit or delay the ability of another party to acquire us, which could cause our stock price to decline.

Various provisions of our articles of incorporation, bylaws and compensation plans and agreements could delay or prevent a third party from acquiring us, even if doing so might be beneficial to our shareholders. These items include:

• a change of control severance plan described at Item 11—Executive Compensation,

• a stay bonus plan described at Item 11—Executive Compensation,

• incentive bonus agreements with executives and key employees described at Item 11—Executive Compensation, and

• the authorization to issue preferred stock by action of the board of directors acting alone, thus without obtaining shareholder approval.

The Bank Holding Company Act of 1956, as amended, and the Change in Bank Control Act of 1978, as amended, together with federal regulations, require that, depending on the particular circumstances, either OCC approval must be obtained or notice must be furnished to the OCC and not disapproved prior to any person or entity acquiring “control” of a national bank, such as Metrocorp. These provisions may prevent a merger or acquisition that would be attractive to shareholders and could limit the price investors would be willing to pay in the future for our common stock.

We are exposed to risk of environmental liabilities with respect to properties to which we take title.

In the course of our business, we may foreclose and take title to real estate and could be subject to environmental liabilities with respect to these properties. We may be held liable to a governmental entity or to third parties for property damage, personal injury, investigation and clean-up costs incurred by these parties in connection with environmental contamination, or may be required to investigate or clean-up hazardous or toxic substances, or chemical releases at a property. The costs associated with

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investigation or remediation activities could be substantial. In addition, if we are the owner or former owner of a contaminated site, we may be subject to common law claims by third parties based on damages and costs resulting from environmental contamination emanating from the property. If we become subject to significant environmental liabilities, our business, financial condition, results of operations and cash flows could be materially adversely affected.

We could sustain losses if our asset quality declines.

Our earnings are significantly affected by our ability to properly originate, underwrite and service loans. We could sustain losses if we incorrectly assess the creditworthiness of our borrowers or fail to detect or respond to deterioration in asset quality in a timely manner. Problems with asset quality could cause our interest income and net interest margin to decrease and our provisions for loan losses to increase, which could adversely affect our results of operations and financial condition.

Our recent results may not be indicative of our future results.

We may not be able to sustain our historical rate of growth or may not even be able to grow our business at all. Various factors, such as economic conditions, regulatory and legislative considerations and competition, may also impede or prohibit our ability to expand our market presence. If we experience a significant decrease in our historical rate of growth, our results of operations and financial condition may be adversely affected due to a high percentage of our operating costs being fixed expenses.

We may issue additional common stock or other equity securities in the future which could dilute the ownership interest of existing shareholders

In order to maintain our capital at desired or regulatorily-required levels, or to fund future growth, our board of directors may decide from time to time to issue additional shares of common stock, or securities convertible into, exchangeable for or representing rights to acquire shares of our common stock. The sale of these shares may significantly dilute your ownership interest as a shareholder. New investors in the future may also have rights, preferences and privileges senior to our current shareholders which may adversely impact our current shareholders.

Holders of our junior subordinated debentures have rights that are senior to those of our common stockholders.

We have supported our continued growth through the issuance of trust preferred securities from a special purpose trust and accompanying junior subordinated debentures. At October 31, 2005, we had outstanding trust preferred securities and accompanying junior subordinated debentures totaling $10.3 million. Payments of the principal and interest on the trust preferred securities are conditionally guaranteed by us. Further, the accompanying junior subordinated debentures we issued to the trust are senior to our shares of common stock. As a result, we must make payments on the junior subordinated debentures before any dividends can be paid on our common stock and, in the event of our bankruptcy, dissolution or liquidation, the holders of the junior subordinated debentures must be satisfied before any distributions can be made on our common stock.

ITEM 2. PROPERTIES

Metrobank operates from the following offices which are owned by Metrobank, except for the in-store Wal-mart Moline, Illinois, Branch and the Morrison Branch in Morrison, Illinois, which are leased under various terms. In addition, the Paul Revere Square office is part of a condominium association and is subject to the association’s bylaws. In the opinion of management, each of the properties owned by Metrocorp is adequately covered by insurance:

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Head Office	1523 Eighth Street, East Moline, Illinois
Paul Revere Square	2322 East Kimberly, Davenport, Iowa
53rd Street Branch	2533 East 53rd Street, Davenport, Iowa
Avenue of the Cities Branch	701 Avenue of the Cities, East Moline, Iowa
Hampton Branch	629 State Street, Hampton, Illinois
Milan Branch	102 East First Avenue, Milan, Illinois
Moline Branch	2115 48th Street, Moline, Illinois
Wal-mart Branch	3930 44th Avenue Drive, Moline, Illinois
Silvis Branch	1300 John Deere Expressway, Silvis, Illinois
Rapids City Branch	1700 Second Avenue, Rapids City, Illinois
Preston Branch	One West White Street, Preston, Illinois
Andover Branch	4330 140th Street, Andover, Iowa
Delmar Branch	301 Western Avenue, Delmar, Iowa
Miles Branch	329 Ferry Road, Miles, Iowa
Sabula Branch	404 Sycamore, Sabula, Iowa
Mount Carroll Branch	642 South East Street, Mount Carroll, Illinois
Chadwick Branch	123 Main Street, Chadwick, Illinois
Morrison Branch	211 West Main Street, Morrison, Illinois
Operations Office	1505 Seventh Street, East Moline, Illinois
Community Insurance Office	329 Ferry Road, Miles, Iowa
Rock Island Branch	1800 5th Avenue, Rock Island, Illinois

ITEM 3. LEGAL PROCEEDINGS

Metrocorp and Metrobank are periodically party to or otherwise involved in legal proceedings arising in the normal course of business, such as claims to enforce liens, claims involving the making and servicing of real property loans, and other issues incident to the banking business. Management does not believe that there is any pending or threatened proceeding which, if determined adversely, would have a material effect on Metrocorp’s or Metrobank’s business, results of operations or financial condition.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

There were no matters submitted to a vote of the shareholders during Metrocorp’s fourth fiscal quarter ended October 31, 2005.

PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Common Stock

     Description. As of February 20, 2006, there were 3,000,000 shares of Metrocorp common stock authorized, of which 2,485,030 shares were issued. There are 1,186,068 shares outstanding (which includes 144,421 shares held by Employee Stock Ownership Plan participants) and held of record by 360 shareholders, and 1,298,962 shares were held as treasury stock following the 10-for-1 stock split effective on May 17, 2004. Holders of common stock do not have the preemptive right to acquire additional unissued or treasury shares of Metrocorp or securities convertible into shares or carrying stock purchase warrants or privileges.

     Voting. Each share of common stock is entitled to one vote in all matters and cumulative voting may be used in the election of directors. To take action on the following matters the affirmative vote of 80% of the outstanding shares of common stock is required if such action is not approved by a majority of the Board:

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• amendment to the Articles of Incorporation,

• a plan of merger or consolidation,

• the sale, lease, change, transfer or other disposition of substantially all of the property of Metrocorp,

• the granting of consent to the disposition of property other than in the ordinary course of business by an entity controlled by Metrocorp, or

• a plan for the liquidation or dissolution of Metrocorp.

If such action is approved by the Board, the affirmative vote of two-thirds of the outstanding shares is required for approval. Action on any other matter requires that a quorum be present at the meeting and that the affirmative vote of a majority of such quorum approve such action.

     Dividends. Holders of common stock are entitled to dividends as and when declared by Metrocorp’s Board of Directors, subject to regulatory requirements. Metrocorp has paid the following per share dividends in the past three fiscal years (as adjusted for the 10-for-1 stock split effective October 31, 2004):

Year ended	Per share dividends paid
October 31, 2005	$	0.360
October 31, 2004		0.352
October 31, 2003		0.344

     The ability of Metrocorp to pay dividends is subject to Metrocorp’s dividend policy and depends upon the earnings and financial condition of Metrobank and statutory and regulatory restrictions. See “Regulation and Supervision” under Item 1 of this report. Metrocorp’s dividend policy, in general, provides that the amount and rate of dividends to be paid will be determined by the Board of Directors after consideration of asset and deposit growth and profits. Dividends may not be sustained unless the corporate net income from the current year plus the prior two years, less dividends paid during that period, have been sufficient to fully fund the dividends. The Board of Directors of Metrocorp currently anticipates that Metrocorp will continue to pay cash dividends in the future similar to those paid in the past.

     Restrictions on Transfer. Metrocorp’s common stock is not traded or listed on any exchange or market quotation system, nor does management expect that there will be any formal market makers in the shares in the future. Metrocorp may continue, however, to make a limited market in its own shares through its Treasury Stock repurchase program to provide some liquidity to shareholders. There are no shares of common stock issuable pursuant to outstanding options or warrants or convertible securities. The following table indicates the high and low per share sales prices known to management in the past two fiscal years, as adjusted for the 10-for-1 stock split effective May 17, 2004.

	2005				2004
Quarter Ended	Low		High		Low		High
January 31	$	35.80	$	35.80	$	34.50	$	34.50
April 30		38.20		38.20		35.80		35.80
July 31		38.20		38.20		35.80		35.80
October 31		39.00		40.50		35.80		35.80

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Subordinated Debentures and Trust Preferred Securities

In November 2001, the Trust issued 10,000 Company Obligated Mandatorily Redeemable Preferred Securities (“Trust Preferred Securities”) for $1,000 per share in an aggregate amount of $10,000,000. The Trust Preferred Securities were offered and sold in a private placement in reliance on the registration exemption provided by Section 4(2) of the Securities Act.

Quarterly cash distributions are paid as described in the Trust Preferred Securities documents at a variable rate equal to the prime rate plus .75%. The Trust Preferred Securities may be redeemed on October 31, 2031; however, the maturity date may be shortened to a date not earlier than January 1, 2007.

Junior Subordinated Debentures

Concurrently with the issuance of the Trust Preferred Securities by the Trust, the Trust invested the proceeds from the issuance of the Subordinated Debt in a Floating Rate Subordinated Note due November 1, 2031, issued by Metrocorp in the aggregate principal amount of $10,309,278 (“the “Subordinated Note”). The Company used the proceeds from the sale of the Subordinated Note to the Trust to capitalize the acquisition of two subsidiary banks and Community Insurance, Inc. from Chadwick Bancshares, Inc., which were then merged into Metrobank.

Recent Sales of Unregistered Securities

None.

Repurchases of Equity Securities

Metrocorp has maintained a common stock repurchase program for shareholders over the past several years. During the fourth quarter of the fiscal year ended October 31, 2005, there were no common stock repurchases.

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ITEM 6. SELECTED FINANCIAL DATA

The following selected financial data is derived from Metrocorp’s consolidated financial statements. This data should be read in connection with Metrocorp’s financial statements and the accompanying notes thereto included elsewhere in this report.

METROCORP, INC.
Financial Summary
(in thousands, except per share amounts)

Year ended October 31,	2005			2004			2003			2002			2001
Statement of Income Data:
Interest income	$	24,703		$	24,022		$	26,229		$	32,198		$	26,003
Interest expense		9,673			7,204			9,106			13,774			14,650
Net interest income		15,030			16,818			17,123			18,424			11,353
Provision for loan losses		(1,150	)		—			1,766			755			83
Noninterest income		4,893			5,114			6,536			6,235			3,730
Noninterest expense		14,487			15,488			15,596			14,333			10,442
Income before income taxes		6,586			6,444			6,297			9,571			4,558
Provision for income taxes		1,499			1,407			1,542			2,580			796
Net income	$	5,087		$	5,037		$	4,755		$	6,991		$	3,762
Per Common Share Data:
Earnings, basic and diluted	$	3.98		$	3.71		$	3.51		$	5.12		$	2.74
Dividends paid		0.360			0.352			0.344			0.336			0.328
Book value at October 31		35.57			37.82			35.44			32.20			26.24
Balance Sheet Data:
Loans, net	$	206,701		$	216,287		$	233,821		$	270,650		$	169,405
Total assets		578,977			575,689			558,306			558,976			389,577
Total deposits		511,411			500,015			486,946			486,102			337,548
Total borrowings		11,182			11,898			10,664			15,135			12,182
Junior subordinated debentures		10,309			10,309			10,309			10,309			—
Shareholders’ equity		37,049			39,177			37,022			35,009			28,706
Redeemable common stock held by ESOP plan participants		6,492			11,767			10,792			9,153			8,066
Financial Ratios:
Return on average assets		0.90	%		0.88	%		0.86	%		1.24	%		0.94	%
Return on average equity		13.56	%		13.41	%		12.67	%		22.30	%		16.27	%
Net interest margin (FTE)		3.16	%		3.53	%		3.69	%		3.88	%		3.47	%
Noninterest expense to average total assets		2.55	%		2.71	%		2.81	%		2.55	%		2.60	%
Net loan losses (recoveries) to average loans		(0.09	)%		0.03	%		0.85	%		0.31	%		0.04	%
Average equity to average assets		6.61	%		6.58	%		6.76	%		5.58	%		5.76	%
Dividend payout ratio		9.05	%		9.49	%		9.80	%		6.56	%		11.97	%
At October 31:
Equity to assets		6.40	%		6.81	%		6.63	%		6.26	%		7.37	%
Allowance for loan losses to loans		1.20	%		1.58	%		1.49	%		1.47	%		1.10	%

FTE = Fully Taxable Equivalent

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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of its financial condition and results of operations is intended to provide a better understanding of the significant changes and trends relating to Metrocorp’s financial condition, results of operations, liquidity and interest rate sensitivity. The following discussion should be read in connection with “Selected Financial Data” at Item 6 of this report and our audited consolidated financial statements and the accompanying notes thereto included elsewhere in this report. The discussion covers the results of operations for the years ended October 31, 2005, 2004, and 2003, and financial condition for the years ended October 31, 2005 and 2004.

Average balances, including balances used in calculating certain financial ratios, are comprised of average daily balances for Metrocorp. Within Management’s Discussion and Analysis of Financial Condition and Results of Operations, interest income and net interest income are generally presented on a fully tax-equivalent (FTE) basis, when stating average yields, net interest margins or spreads. Tax-exempt income has been adjusted to a tax-equivalent basis using an incremental tax rate of 34%.

Metrocorp, Inc. (the “Company” or “Metrocorp”) is a bank holding company providing bank and bank related services through its wholly-owned subsidiary, Metrobank, N.A. and its subsidiary, Community Insurance, Inc., and Metrocorp Capital Trust I. The Company is engaged in the business of commercial and retail banking and trust and insurance services. The Company focuses on establishing long-term relationships with customers, and is committed to serving the financial needs of the communities in its market area. Metrobank maintains nineteen locations located in western Illinois and eastern Iowa with the insurance agency located in the Miles, Iowa branch. The majority of the Company’s income is derived from commercial and retail lending, investments, and deposit activities. Metrocorp Capital Trust I was capitalized in November 2001 for the purpose of issuing trust preferred securities.

Corporate Developments in Fiscal 2005

On June 6, 2005, Metrobank purchased a building in Rock Island, Illinois, to operate its eighteenth branch location. After remodeling was completed, the office opened for business on October 3, 2005. In recent years, the Bank has added some large customers to its base but had not been able to find a suitable and cost-efficient location in this market. As a result of opening this new office, additional expenses have and will be incurred, primarily in compensation, benefits and in costs associated with owning, operating and maintaining an office building.

On August 25, 2005, the Company and its shareholders received a hostile tender offer from National Bancshares, a privately-held community banking organization based in the Quad Cities, to purchase all the shares of common stock of Metrocorp for $52.00 per share in cash. The tender offer was subject to approval of all appropriate regulatory agencies, obtaining at least 50.1% of Metrocorp’s outstanding shares, and had an expiration date of September 23, 2005. The Company hired St. Charles Capital, LLC of Denver, Colorado to provide advisory services related to this unsolicited tender offer. St. Charles is an experienced investment banking firm that has expertise in matters of mergers and acquisitions in the banking industry and in the valuation of banks, with particular expertise in independent community banks. St. Charles prepared a thorough analysis and evaluation of the offer. With the assistance of the Company’s legal and financial advisors, the Board of Directors, after carefully considering the offer, unanimously recommended that shareholders reject the offer and not tender any of their shares. On September 23, 2005 the offer expired as stated.

As a result of this process the Company began receiving other non-binding offers from various bank holding companies. Realizing it was not practical or cost-efficient to deal with each of these offers individually the Board began a process to evaluate the strategic alternatives available to the Company

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for maximizing value to its shareholders. Seven investment banking firms were interviewed by the Board of Directors and in October 2005, Hovde Financial, LLC of Chicago, Illinois was hired to act as the Company’s financial advisor. Since that time the Company has been diligently working with Hovde to execute a systematic process of contacting potential buyers of the Company and obtaining external valuations of the Company in connection with a possible change of control. This process by nature is detailed, information intensive, and thorough. A great deal of time, energy and expense has been expended by the Board, management, and employees with this process. Interested parties are performing due diligence and it is expected that some conclusion to the process will be made in the second quarter of fiscal year 2006.

Critical Accounting Policies and Estimates

The Company’s discussion and analysis of its financial condition and results of operations are based upon the Company’s consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, the Company evaluates its estimates, including those related to the adequacy of the allowance for loan losses and the impairment of goodwill. The Company bases its estimates on historical experience and various other assumptions that are believed to be reasonable, under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Management has identified its most critical accounting policies to be those related to the allowance for loan losses and asset impairment judgments including the recoverability of goodwill. The Company’s policy related to the estimate on the allowance for loan losses, can be found in Notes 1 and 6 of the Company’s audited consolidated financial statements included or incorporated by reference elsewhere in this report. Goodwill represents the excess of acquisition costs over the fair value of the net assets acquired in a purchase acquisition. Goodwill is not amortized but is subject to an impairment test at least annually, or more often if conditions indicate a possible impairment.

Financial Condition

The following discussion of the Company’s consolidated financial condition should be read in conjunction with the Selected Financial Data at Item 6 of this report and the audited consolidated financial statements and related notes included elsewhere in this report.

The Company’s total assets at October 31, 2005 were $579.0 million, an increase of $3.3 million, or         .6% from $575.7 million at October 31, 2004. The increase in assets was due primarily to increases in securities available for sale and federal funds sold, which were partially offset by decreases in net loans, cash and due from banks.

The Company’s portfolio of securities available for sale increased $8.7 million, or 3.0%, to $294.1 million at October 31, 2005 from $285.4 million at October 31, 2004. This increase was reduced by the $8.4 million change in the unrealized gain at year end 2004 to an unrealized loss at year end 2005 in accordance with SFAS 115. The Company’s portfolio consists primarily of U. S. Treasury and government obligations, state and political subdivisions, and investment grade corporate bonds. Overall the portfolio has a weighted average life of 3.0 years. During fiscal 2005, purchases of securities available for sale decreased to $53.2 million from $66.0 million in 2004. Repayment and prepayment of principal increased to $32.7 million in 2005 from $26.9 million in 2004. Overall there was a $17.1 million, or 6.1%, increase in the amortized cost of securities available for sale. The increase was

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primarily as a result of a reduction in net loans and an increase in total deposits which are discussed below.

The Company’s portfolio of net loans decreased by $9.6 million, or 4.4%, to $206.7 million at October 31, 2005 from $216.3 million at October 31, 2004. Net loans decreased in part as a result of a reduction of $6.6 million, or 35.9%, in portfolio student loan outstanding, from $18.4 million at October 31, 2004 to $11.8 million at October 31, 2005. These particular student loans are to students who have already graduated or left school and are past their deferment period. As a result, the Company receives monthly payments on these loans with no new originations. The Company also experienced smaller, yet significant, declines in commercial and installment loans. Commercial loans declined $3.5 million, or 13.2%, to $23.1 million at October 31, 2005 from $26.6 million at October 31, 2004. The Company experienced increased paydowns on commercial equipment and operating lines than what could be replaced with new borrowers, as competition has intensified. Installment loans declined $4.0 million, or 19.8%, from $20.2 million at October 31, 2004 to $16.2 million at October 31, 2005. The Company has seen a continued decline in automobile financing due to low interest or no interest financing provided by domestic automobile financing subsidiaries. Some of these declines were partially offset by a $2.6 million, or 6.5%, increase to $41.1 million at October 31, 2005 from $38.5 million at October 31, 2004 in real estate financing on farmland.

Federal funds sold of $8.7 million at October 31, 2005 was up $3.4 million, or 64.2%, from $5.3 million at October 31, 2004. Federal funds sold and its counterpart, federal funds purchased, are used as the balancing account of the Company’s daily cash position and are generally short term (daily) in nature.

Customer deposit balances increased by $11.4 million, or 2.3%, to $511.4 million at October 31, 2005 from $500.0 million at October 31, 2004. The majority of this increase, $11.3 million, was in the Company’s interest-bearing demand and money market accounts. During fiscal year 2005 the Company added two large new municipalities to its customer base. While these type of accounts are usually done on a multi-year bid basis (usually a minimum of at least three years, with automatically renewable options) the Company has demonstrated the ability to maintain these relationships over extended periods of time. In addition to this, the Company had a change in the composition of its time deposits of over and under $100,000. Time deposits of under $100,000, which are mostly made up of retail consumer certificates of deposit, increased to $131.4 million, or 8.2%, at October 31, 2005 from $121.4 million at October 31, 2004. The Company’s time deposits of $100,000 or over decreased $10.8 million, or 13.5%, to $69.3 million at October 31, 2005 from $80.1 million at October 31, 2004. Time deposits of $100,000 or over are usually short term in nature and subject to greater interest rate risk given the greater frequency in repricing. The Company uses this product to assist our municipal clients with funds that can be invested for time periods of generally one year or less. The Company does not solicit funds from outside its own market area and the majority of the customers that we do solicit funds from have their core deposit accounts with Metrobank as well. The overall increase in deposits, along with the decrease in net loans, was used to fund the growth in the securities available for sale portfolio during the period.

Stockholders’ equity decreased $2.2 million, or 5.6%, to $37.0 million at October 31, 2005 from $39.2 million at October 31, 2004. The decrease in stockholders’ equity was primarily due to a change of $5.2 million from an unrealized gain to an unrealized loss on securities available for sale in accordance with SFAS 115. In addition it decreased from dividends paid to shareholders and the purchase of Company stock from employees exercising their put options on the termination of the Company’s Employee Stock Ownership Plan during the period. Net income of $5.1 million reduced the effect these decreases had on overall equity.

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Results of Operations

The following discussion of the Company’s results of operations should be read in conjunction with the Selected Financial Data at Item 6 of this report and the audited consolidated financial statements and related notes included elsewhere in this report.

The Company’s results of operations are primarily dependent on net interest income, non-interest income, non-interest expense and income tax expense. Net interest income is the difference, or spread, between the average yield on interest-earning assets and the average rate paid on interest-bearing liabilities. The interest rate spread is affected by regulatory, economic, and competitive factors that influence interest rates, loan demand, and deposit flows. The Company, like other financial institutions, is subject to interest rate risk to the extent that its interest-earning assets mature or reprice at different times, or on a different basis, than its interest-bearing liabilities.

The Company’s non-interest income is derived primarily from fees charged on transaction accounts, which help offset the costs associated with establishing and maintaining these deposit accounts. In addition, non-interest income is derived from gains or losses on the sale of mortgage loans, student loans, and securities available for sale. Additionally, non-interest income has been derived from the activities of Metrobank’s trust department, which provides a variety of professional trust services.

Comparison of Operating Results for the Years Ended October 31, 2005 and October 31, 2004

General

The Company recorded net income of $5,087,000 for the year ended October 31, 2005, compared to net income of $5,037,000 for the year ended October 31, 2004. The small increase of $50,000, or 1.0%, in net income primarily reflects a negative $1,150,000 provision for loan losses, as discussed below under “Provision for Loan Losses,” offset by a $1,788,000 decrease in net interest income. In addition, there was a small decrease in non-interest income that was offset to a greater degree by a decrease in non-interest expense.

Net Interest Income

Net interest income for the year ended October 31, 2005 decreased by $1,788,000, or 10.6%, to $15,030,000 compared to $16,818,000 for the period ended October 31, 2004. The decrease in net interest income reflects a $2,470,000 increase in interest expense which was offset by a $682,000 increase in interest income. Overall the net yield on average earning assets decreased by .37% to 3.16% for the period ended October 31, 2005 from 3.53% for the same period in 2004. The decrease in net yield on average earning assets was due primarily to the rise in short term interest rates (200 basis points rise in the federal funds rate) as the Company’s rate on average funds increased by .47% to 1.86% in 2005 from 1.39% in 2004. In addition there was a change in the composition of the balance sheet during the year. The Company had an increase in the securities available for sale portfolio (overall lower yields, 4.33% for 2005) coupled with a reduction in loans outstanding, which would normally be at higher yields (5.91% for 2005) when comparing an investment security to a loan. Interest rates, particularly at the shorter end of the yield curve, increased during the last half of 2004 and throughout fiscal 2005. The yield curve has flattened significantly during the same period of time. Management believes interest rates will more likely increase than decrease in the first half of fiscal 2006 before holding steady for the remainder of the year. Once rates have steadied interest income on average earning assets should begin to rise faster than interest expense as increased repricing should occur on the asset side as opposed to deposits, thus increasing net interest income.

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Interest Income

Interest income for the year ended October 31, 2005 increased $682,000, or 2.84%, to $24,704,000 from $24,022,000 for the same period in 2004. The increase was due primarily to an increase of $454,000 in interest income from loans, which was the result of the average yield increasing to 5.91% in 2005 compared to 5.42% in 2004. This was offset by a decrease in average loan outstandings of $11,867,000 to $226,602,000 in 2005 from $238,469,000 in 2004. Interest income on investments was up $102,000 in 2005 from 2004 as average outstandings were up $12,559,000, or 4.6%, to $288,153,000 in 2005 from $275,594,000 in 2004. The average yield on investments declined .14% from 4.47% in 2004 to 4.33% in 2005.

The following table sets forth the weighted average tax equivalent effective interest rate on interest-earning assets and interest-bearing liabilities at the end of each of the years presented. Fees on loans are included in the calculation but are not material in nature.

At October 31,	2005			2004			2003
Weighted Average Yield On
Loans, including held for sale		6.19	%		5.62	%		5.77	%
Securities available for sale		4.39			4.41			4.63
Federal Funds Sold		3.84			1.98			1.00
Other		5.03			5.20			5.13
Combined weighted average yield		5.07			4.89			5.16
Weighted Average Rate Paid On
Interest-bearing and money market demand deposits		1.83			1.32			1.19
Savings deposits		0.51			0.51			0.51
Time deposits		3.05			2.18			2.48
Other borrowed money		5.65			4.14			3.68
Combined weighted average rate paid		2.41			1.75			1.80
Spread		2.66			3.14			3.36

Rate/Volume Analysis

The following schedule presents the dollar amount of changes in interest income and interest expense for major components of interest-earning assets and interest-bearing liabilities. It distinguishes between the changes in average outstanding balances and that due to the levels and volatility of interest rates. For each category of interest-earning assets and interest-bearing liabilities, information is provided on changes attributable to changes in volume (i.e., changes in volume multiplied by old rate) and changes in rate (i.e., changes in rate multiplied by old volume). For purposes of this table, changes attributable to both rate and volume that cannot be segregated have been allocated proportionately to the change due to volume and the change due to rate. Fees on loans are included but not material in nature.

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YEAR ENDED OCTOBER 31,	2005 VS. 2004									2004 VS. 2003
	Increase			Increase			Total			Increase			Increase			Total
	(Decrease)			(Decrease)			Increase			(Decrease)			(Decrease)			Increase
(in Thousands)	Due to Volume			Due to Rate			(Decrease)			Due to Volume			Due to Rate			(Decrease)
INTEREST-EARNING ASSETS
Loans, including held for sale	$	(640	)	$	1,094		$	454		$	(1,456	)	$	(1,452	)	$	(2,908	)
Securities available for sale		529			(427	)		102			2,470			(1,726	)		744
Federal funds sold		29			14			43			(64	)		4			(60	)
Other		115			(32	)		83			6			11			17
Total interest-earning assets	$	33		$	649		$	682		$	956		$	(3,163	)	$	(2,207	)
INTEREST-BEARING LIABILITIES
Interest-bearing and money market demand deposits	$	(172	)	$	691		$	519		$	262		$	(356	)	$	(94	)
Savings deposits		13			—			13			10			(22	)		(12	)
Time deposits		(7	)		1,542			1,535			(347	)		(1,556	)		(1,903	)
Other borrowed money		(63	)		466			403			282			(175	)		107
Total interest-bearing liabilities	$	(229	)	$	2,699		$	2,470		$	207		$	(2,109	)	$	(1,902	)
Net effect on net interest income	$	262		$	(2,050	)	$	(1,788	)	$	749		$	(1,054	)	$	(305	)

Average Balances, Interest Rates and Yields

The following table presents for the periods indicated the total dollar amount of interest income from average interest-earning assets and the resultant yields, as well as the interest expense on average interest-bearing liabilities, expressed in both dollars and rates. No tax equivalent adjustments have been made. Non-accruing loans have been included in the table as loans carrying a zero yield. Loan fees are included but are not material in nature.

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YEAR ENDED
OCTOBER 31,	2005								2004								2003
	AVERAGE			INTEREST					AVERAGE			INTEREST					AVERAGE			INTEREST
(Dollars in	OUTSTANDING			EARNED/		YIELD			OUTSTANDING			EARNED		YIELD			OUTSTANDING			EARNED		YIELD
Thousands)	BALANCE			PAID		/RATE			BALANCE			/PAID		/RATE			BALANCE			/PAID		/RATE
INTEREST-EARNING ASSETS
Loans, including held for sale	$	226,602		$	13,311		5.87	%	$	238,469		$	12,857		5.39	%	$	263,985		$	15,766		5.97	%
Securities available for sale		288,153			11,084		3.85			275,594			10,982		3.98			223,619			10,236		4.58
Federal funds sold		1,505			53		3.52			368			9		2.45			5,137			70		1.36
Other		4,732			256		5.41			2,853			174		6.10			2,741			157		5.73
Total interest-earning assets		520,992		$	24,704		4.74	%		517,284		$	24,022		4.64	%		495,482		$	26.229		5.29	%
Non-interest-earning Assets		46,947								53,194								59,635
Total assets	$	567,939							$	570,478							$	555,117
INTEREST-BEARING LIABILITIES
Interest -bearing & money market demand deposits	$	203,481		$	2,973		1.46	%	$	206,168		$	2,453		1.19	%	$	185,731		$	2,547		1.37	%
Savings deposits		42,510			213		0.50			39,850			200		0.50			38,037			212		0.56
Time deposits		196,219			5,097		2.60			196,599			3,563		1.81			210,750			5,466		2.59
Other borrowed funds		29,689			1,391		4.69			31,606			988		3.13			22,421			881		3.93
Total interest-bearing liabilities		471,899		$	9,674		2.05	%		474,223		$	7,204		1.52	%		456,939		$	9,106		1.99	%
Non-interest-bearing:
Deposits		47,051								43,655								44,516
Liabilities		2,344								3,770								6,172
Total liabilities		521,294								521,648								507,627
Repurchase Liability (ESOP)		9,129								11,279								9,973
Shareholder’s equity		37,516								37,551								37,517
Total liabilities & shareholders’ equity	$	567,939							$	570,478							$	555,117
Net interest-earning assets	$	49.093							$	43,061							$	38,543
Net interest income				$	15,030							$	16,818							$	17,123
Net interest rate spread							2.69	%							3.12	%							3.30	%
Net yield on average interest-earning assets							2.88	%							3.25	%							3.46	%
Average interest-earning assets to average interest-bearing liabilities		110.40	%							109.08	%							108.44	%

Interest Expense

Interest expense increased $2,470,000, or 34.3%, to $9,674,000 for the year ended October 31, 2005 from $7,204,000 in 2004. Interest expense on deposits increased by $2,067,000, due primarily to an increase in the average rates paid on interest-bearing deposits during the period to 1.87% for fiscal year 2005 from 1.40% during the fiscal year 2004. The average balance of non-interest bearing deposits increased by $3,396,000, which resulted in an overall increase of $2,989,000 in the average balance of deposits. Interest expense on other borrowed funds increased $403,000 during the period, due to an increase in the average cost to 4.69% from 3.13%, which was partially offset by a decrease of $1,917,000 in the average balance outstanding during the period.

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Provision for Loan Losses

During 2005, the Company re-evaluated its methodology for calculating the allowance for loan losses. Based on the new methodology, net recoveries of $198,000 in 2005 and the decline in problem credits, the allowance for loan losses was reduced through a negative provision of $1,150,000 during the year ended October 31, 2005. In addition, the average balance on loans outstanding decreased by $11,867,000, or 5.0%, from $238,469,000 during 2004 to $226,602,000 for fiscal year 2005. Management believes that, based on a detailed review of the loan portfolio, historic loan losses, current economic conditions, lack of growth in the loan portfolio, and other factors, the current level of provision for loan losses, and the resulting level of the allowance for loan losses, reflects an adequate allowance against probable losses from the loan portfolio at such date.

Economic conditions in the agricultural sector of the Company’s market areas are currently strong and stable. In 2005, below average yields were offset somewhat by crop insurance proceeds and increased government farm support programs. The agricultural economy is accustomed to production and price fluctuations and is generally able to adjust to such fluctuations without significant problems. Higher petroleum prices had some dampening effect on 2005 profits and could cause more of a negative impact on profits in 2006 and beyond due to price increases in chemicals used in agricultural production. Increased interest rates will also be a negative factor for the agricultural sector. Should there be an extended period of low commodity prices or yields, or a significant change in the government farm support programs, the Company’s agricultural loan portfolio could weaken and create a need for the Company to increase its allowance for loan losses through increased charges to provision for loan losses.

Furthermore, although the Company maintains its allowance for loan losses at a level that it considers to be adequate, investors and others are cautioned that there can be no assurance that future losses will not exceed estimated amounts, or that additional provisions for loan losses will not be required in future periods. In addition, the Company’s determination of the allowance for loan losses is subject to review by its regulatory agencies, which can require the establishment of additional general or specific allowances.

Noninterest Income

Noninterest income decreased by $221,000, or 4.3%, to $4,893,000 for the year ended October 31, 2005 from $5,114,000 for the same period in 2004. The decrease was primarily in the areas of service charges on deposit accounts ($85,000), gains on the sale of loans ($105,000), and trust fees ($75,000). The reduction in service charges was primarily in the area of consumer checking service charges. As competition has dictated, free checking is now the norm for retail checking accounts. The Company has experienced a significant migration of current customers changing their account over from a minimum balance regular checking account to the free checking as well as smaller balance interest-bearing checking accounts to avoid any service charges. To a lesser extent there has been a reduction in commercial checking service charges as the earnings credit that a commercial checking customer receives to offset transaction charges has risen over the course of the last year. It is indexed to the 91 day Treasury bill auction on a monthly basis. Gains on the sale of loans decreased in both the real estate secondary market lending area as well as in student loan gains. The decrease in real estate gains is as a result of the rise in interest rates slowing down not only the mortgage-refinancing market but new originations as well. It is expected that this category will likely be flat in the next fiscal year as well due to the current interest rate environment. The decline in student loan gains was a direct result of the sale of over $4,120,000 of portfolio loans at a gain of approximately $103,000 in 2004. Taking this out, gains on student loan origination sales were actually up over 2004 by $67,000. The decline in trust fees was primarily in the area of investment service fees which was down $63,000, or 44.9%, from fiscal year 2004.

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Noninterest Expense

Noninterest expense decreased $1,000,000, or 6.5%, to $14,487,000 for the year ended October 31, 2005 from $15,487,000 for the same period in 2004. The decrease in noninterest expense primarily reflects a $1,117,000 decrease in salaries and employee benefits. This represents a 11.7% decrease from the $9,577,000 expense recorded during fiscal year 2004. The Company had a reduction in overall workforce which resulted in direct salary expense being reduced by $417,000. The majority of this was accomplished through normal turnover in addition to outsourcing some janitorial services. As a result of this reduction in workforce the Company also showed a decrease in employee medical expense of $124,000 from $847,000 at October 31, 2004 to $723,000 at October 31, 2005. In addition to the above and as a result of the termination of the Employee Stock Ownership Plan (“ESOP”) on November 14, 2004 there was a reduction of $582,000 in 2005 versus 2004 in employee benefit expenses. Beginning January 1, 2006, the Company started to offer an employer contribution match to the Company-sponsored 401(k) plan that has been in place for several years.

Income Tax Expense

For the year ended October 31, 2005 the Company recorded income tax expense of $1,499,000 which was $92,000, or 6.5%, over the $1,407,000 recorded for the year ended October 31, 2004. The increase in income taxes is reflective of the change in operating results between the comparable periods.

Comparison of Operating Results for the Years Ended October 31, 2004 and October 31, 2003

General

Net income for the year ended October 31, 2004 increased $282,000, or 5.9%, to $5,037,000, from $4,755,000 for the same period ended October 31, 2003. The increase in net income reflects a significant decrease in the provision for loan losses, $1,766,000, which was mostly offset by a substantial decrease in noninterest income of $1,422,000 when comparing the year 2004 to 2003.

Net Interest Income

Net interest income for the year ended October 31, 2004 decreased by $305,000, or 1.8%, to $16,818,000 compared to $17,123,000 for the period ended October 31, 2003. The decrease in net interest income reflects a decrease in the net yield on average earning assets but was partially offset by an increase of $4,518,000, or 11.7%, in net interest-earning assets. The net yield on average earning assets decreased to 3.53% for the period ended October 31, 2004 from 3.69% for the same period in 2003. The decrease in net yield on average earning assets was a combination of average yields on assets declining to a greater extent than the average rates on interest-bearing liabilities, .51% versus .47%, and a change in the balance sheet mixture from loans to investment securities. During 2004 the Company had, as a percentage to total assets, 41.8% in loans and 48.3% in investment securities which compares to 47.6% in loans and 40.3% in investment securities for fiscal year 2003. Over these two years loans had, on average, a 1.40% higher average rate than the investment security portfolio. Interest rates, particularly at the shorter end of the yield curve, increased during the last half of fiscal 2004 and are expected, based on economic forecasts, to continue to increase at a measured pace.

Interest Income

Interest income for the year ended October 31, 2004 decreased $2,207,000, or 8.4%, to $24,022,000 from $26,229,000 for the same period in 2003. The increase was due primarily to a decrease of $2,909,000 in interest on loans which was the result of a decrease of $25,516,000, or 9.7%, in average outstandings from 2003 to 2004 and a decline of .58% in the yield on loans over this same time period.

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As a partial offset to this decline in interest income interest on investment securities increased by $745,000 to $10,982,000 for the year ended October 31, 2004 from $10,237,000 at October 31, 2003. The average balance outstanding in 2004 increased by $51,975,000 over 2003, generating an additional $2,470,000 in interest income, which was partially offset by a decline in the average yields of .59%, from 5.06% in 2003 to 4.47% in 2004.

Interest Expense

Interest expense decreased $1,902,000, or 20.9%, to $7,204,000 for the year ended October 31, 2004 from $9,106,000 for the 2003 year. Interest expense on deposits decreased by $2,010,000, due primarily to a decrease in the average rates paid on deposits during the period from 1.89% to 1.40%, which was partially offset by a $8,099,000 increase in the average balance of deposits between the periods. Interest expense on other borrowings increased by $107,000 during the period, due to an increase of $9,185,000 in the average balance outstanding during the period, predominantly in federal funds purchased. This was partially offset by a decrease in the average rate paid from 3.93% in 2003 to 3.13% in 2004.

Provision for Loan Losses

There was no provision for loan losses recorded in fiscal year 2004 compared to $1,766,000 for the same period in 2003. During 2003 the Company had $2,254,000 in net charge-offs for the year compared to $74,000 for 2004. In 2003 the Company took some significant write-offs on six commercial loans in its northern Iowa and Illinois markets. Once these loans were addressed the Company did not experience any additional major problem credits throughout fiscal year 2004. Management believed, that, based on a detailed review of the loan portfolio, historic loan losses, current economic conditions, growth or declines in the portfolio, and other factors, the current level of provision for loan losses, and the resulting level of the allowance for loan losses, reflects an adequate allowance against probable losses from the portfolio at such date.

Noninterest Income

Noninterest income decreased by $1,422,000, or 21.8%, to $5,114,000 for the year ended October 31, 2004 from $6,536,000 for the same period in 2003. The major factor contributing to this decrease was a $763,000 decline in the gains on sale of loans from $1,516,000 in 2003 to $753,000 in 2004. The fiscal year of 2003 was the peak of the secondary market real estate origination and refinancing boom in which the Company recorded gains in the amount of $1,171,000 which decreased significantly in 2004 to $250,000, a reduction of $921,000. This was partially offset by an increase in student loan gains of $157,000 to $503,000 in 2004 from $346,000 in 2003. Of this $157,000 increase in 2004, approximately $103,000 was as a result of the sale of $4,120,000 of the Company’s portfolio student loans, separate from the normal interim funding of new loan originations. In addition the Company also experienced decreases in gains on sales of securities available for sale, deposit service charges, and other income, which decreased by $186,000, $257,000 and $242,000, respectively. Deposit service charges saw declines in both account activity service fees and from NSF fees, with 69.6%, or $179,000, attributable to NSF fees. The decrease in the securities gains was as a result of there only being a couple of sales in fiscal 2004 compared to 2003. The reduction in other income is primarily as a result of various miscellaneous income accounts with no one particular line item accounting for a material portion of this decrease.

Noninterest Expense

Noninterest expense decreased by $109,000, or .70%, to $15,487,000 for the year ended October 31, 2004 from $15,596,000 for the same period in 2003. The decrease in noninterest expense primarily reflects a decrease in direct salaries of $241,000 in 2004 compared to 2003. The Company continued to

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look for ways to reduce total employee count in areas of over capacity, mostly through normal attrition. This was predominantly offset by increased advertising costs incurred in 2004 associated with the Company’s celebration of its 100 year anniversary. Expenses relating to this special event were $186,000 in the 2003 fiscal year and $368,000 in fiscal year 2004.

Income Tax Expense

Income tax expense decreased by $135,000, or 8.7%, to $1,407,000 for the year ended October 31, 2004 from $1,542,000 for the same period in 2003. The change in income tax expense reflects the changes in operating results between the comparable periods. Any increase or decrease in income tax expense is directly attributable to the change in taxable income for one year as compared to another.

Asset Quality

It is management’s belief, based on information available at fiscal year end, that the Company’s current asset quality is satisfactory. At October 31, 2005, non-performing assets, consisting of non-accruing loans, accruing loans past due 90 days or more, restructured loans, foreclosed real estate, and other repossessed property, totaled $2,497,000, or .43% of total assets, compared to $2,131,000, or .37% of total assets for the fiscal year ended October 31, 2004.

The Company maintains an allowance for loan losses because of the potential that some loans may not be repaid in full. At October 31, 2005, the Company had an allowance for loan losses of $2,519,000 as compared to $3,471,000 at October 31, 2004. Management’s periodic review of the adequacy of the allowance for loan losses is based on various subjective and objective factors including the Company’s past loss experience, known and inherent risks in the portfolio, adverse situations that may affect the borrower’s ability to repay, the estimated value on any underlying collateral, and current economic conditions. While management may allocate portions of the allowance for specifically identified problem loan situations, the majority of the allowance is based on judgmental factors related to the overall portfolio and is available for any loan charge-offs that may occur.

In determining the allowance for loan losses, the Company specifically identifies loans that it considers to have potential collectibility problems. Based on criteria established by Statement of Financial Accounting Standards (SFAS) No. 114, some of these loans are considered to be “impaired” while others are not considered to be impaired, but possess weaknesses that the Company believes merit additional analysis in establishing the allowance for loan losses. All other loans are evaluated by applying estimated loss ratios to various pools of loans. The Company then analyzes other factors (such as economic conditions) in determining the aggregate amount of the allowance needed. See Note 6 of the Notes to the audited consolidated financial statements included elsewhere in this report.

Liquidity and Capital Resources

The Company’s primary sources of funds are deposits, borrowings, principal and interest payments on loans and mortgage-backed securities, and maturing investment securities. While scheduled loan repayments and maturing investments are relatively predictable, deposit flows and early loan repayments are influenced by the level of interest rates, general economic conditions, and competition.

The Company relies on competitive pricing policies, advertising and customer service to attract and retain its deposits and only solicits these deposits from its primary market areas. Based on its experience, the Company believes that its savings, money market demand deposits, interest-bearing and regular checking accounts are relatively stable sources of funds. The Company’s ability to attract and retain time deposits has been, and will continue to be, significantly affected by market conditions.

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However, the Company does not foresee significant funding issues resulting from a disintermediation of its portfolio of time deposits.

The Company is required by regulation to maintain sufficient liquidity to assure its safe and sound operation. In the opinion of management the Company is in compliance with this requirement.

Liquidity management is both a daily and long-term function of the Company’s management strategy. The Company adjusts its investments in liquid assets based upon management’s assessment of (i) expected loan demand, (ii) expected deposit flows, (iii) yields available on interest-bearing deposits, and (iv) the objectives of its assets/liability management program. Excess liquidity is generally invested in overnight funds sold to one of its correspondent banks. If the Company requires funds beyond its ability to generate them internally or from overnight funds purchased, it has additional borrowing capacity with the FHLB and has collateral eligible for its use with overnight repurchase agreements. The Company is not aware of any significant adverse trends in the Company’s liquidity or its ability to borrow additional funds if needed.

The primary investing activities of the Company are the origination of loans and the purchase of securities. During the years ended October 31, 2005, 2004, and 2003, the Company had net decreases in loan outstandings of $10.5 million, $17.6 million and $37.3 million, respectively. Some of the factors causing these declines are as follows: (i) with the lower interest rate environment the Company experienced declines in home improvement loans, as consumers were refinancing these loans along with their first mortgages into secondary market fixed rate real estate loans; (ii) significant declines in consumer automobile loans as the Company could not match the rates and incentives being offered by the financing subsidiaries of the major car manufacturers; and (iii) declines in student loan outstandings as in 2002 the Company discontinued retaining new student loan originations and began selling them in the secondary market sixty days after they are fully disbursed. During the years ended October 31, 2005, 2004, and 2003, the Company purchased securities available for sale in the amount of $53.3 million, $66.0 million, and $119.7 million respectively.

At October 31, 2005 and 2004 the Company had outstanding loan commitments of $1,269,000 and $891,000, respectively. Certificates of deposits scheduled to mature in one year or less from October 21, 2005 totaled $158.7 million. Based on historical experience, management believes that a significant portion of such deposits will remain with the Company; however, there can be no assurance that the Company can retain all such deposits. Management believes that loan repayment and other sources of funds will be adequate to meet the Company’s foreseeable short and long-term liquidity needs.

The following table summarizes the Company’s significant contractual obligations at October 31, 2005 (in thousands):

Contractual Obligations	Total		Less Than 1 year		1 to 3 years		3 to 5 years		Over 5 years
Time Deposits	$	200,753	$	158,722	$	40,083	$	1,902	$	46
Long-term debt		6,434		672		1,344		2,344		2,074
Subordinated debentures		10,309		—		—		—		10,309
ESOP Repurchase Liability		6,492		6,492		—		—		—
Total	$	223,988	$	165,885	$	41,427	$	4,246	$	12,429

On November 1, 2001, the Company’s unconsolidated trust subsidiary, Metrocorp Capital Trust I, sold $10 million in floating rate cumulative preferred securities. Proceeds from the sale were used to purchase subordinated debentures of Metrocorp, which mature in the year 2031; however, the Company has the option to redeem them at any time after five years with prior regulatory approval. The Company used the proceeds in the purchase of two banks (merged into Metrobank) and Community Insurance.

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The Company and Metrobank are in compliance with their capital requirements and are considered “well capitalized” under current regulatory guidelines. See Note 17 of the Notes to the audited consolidated financial statements included elsewhere in this report. The Company does not anticipate any significant changes to its capital structure.

In November 2004, the Company announced that the Board of Directors had passed a resolution terminating the Company’s Employee Stock Ownership Plan (“ESOP”) which covered substantially all employees of the bank. The effect of this termination was that the shares of Metrocorp stock were distributed to the employees in May 2005. The plan provided for any participant or beneficiary who receives a distribution of employer stock from the ESOP the right to require the Company to purchase such shares at their fair market value any time within 60 days of the distribution date. If this initial put was not exercised, an additional 60-day exercise period is available in the year following the year in which the distribution was made and begins after a new valuation of the stock has been determined and communicated to the participant or beneficiary. The effect of this termination was that during the period of May to July 2005 there were 178,209 shares “put” back to the Company at a price of $38.20 per share (which was the price established by an independent outside appraisal) for a total repurchase of $6,807,584. The value of the remaining shares (144,421) that still have their second “put” option have been classified as mezzanine capital and as such have already been subtracted from the Company’s capital as if they had been redeemed.

The payment of dividends and repurchase of shares has the effect of reducing stockholders’ equity. Prior to authorizing such transactions, the Board of Directors considers the effect the dividend or repurchase of shares would have on liquidity and capital ratios. Metrobank and the Company may declare dividends if certain tolerance limits are observed and which include, in the case of Metrobank, consideration of certain statutory and regulatory restrictions.

Impact of Inflation and Changing Prices

The audited consolidated financial statements and notes thereto included elsewhere in this report have been prepared in accordance with U.S. generally accepted accounting principles, which require the measurement of financial position and operating results in terms of historical dollars without considering the change in the relative purchasing power of money over time due to inflation. The primary impact of inflation is reflected in the increased cost of the Company’s operations. Unlike most industrial companies, virtually all the assets and liabilities of the Company are monetary in nature. As a result, interest rates generally have a more significant impact on a financial institution’s performance than do the effects of general levels of inflation. Interest rates do not necessarily move in the same direction, or to the same extent, as the prices of goods and services.

Impact of New Accounting Standards

In November 2003, the Emerging Issues Task Force (EITF) reached a consensus on certain disclosure requirements under EITF Issue No. 03-1, “The Meaning of Other-Than-Temporary Impairment and Its Application to Certain Investments.” The new disclosure requirements apply to investments in debt and marketable equity securities that are accounted for under Statement of Financial Accounting Standards (SFAS) No. 115, “Accounting for Certain Investments in Debt and Equity Securities.” Effective for fiscal years ending after December 15, 2003, companies were required to disclose information about debt or marketable equity securities with market values below carrying values. The Company previously implemented the disclosure requirements of EITF Issue No. 03-1. In March 2004, the EITF came to a consensus regarding EITF 03-1. Securities in scope are those subject to SFAS 115. The EITF adopted a three-step model that requires management to determine if impairment exists, decide whether it is other-than-temporary, and record other-than-temporary losses in earnings. In November 2005, the Financial Accounting Standards Board (FASB) issued FASB Staff Position (FSP) Nos. FAS 115-1 and

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FAS 124-1, “The Meaning of Other-Than-Temporary Impairment and its Application to Certain Investments,” which will apply to reporting periods beginning after December 15, 2005. The FSPs provide guidance on determining when investments in certain debt and equity securities are considered impaired, whether that impairment is other-than-temporary, and on measuring such impairment loss. The FSPs also include accounting considerations subsequent to the recognition of other-than-temporary impairment and requirements for certain disclosures about unrealized losses that have not been recognized as other-than-temporary impairments.

Quarterly Results of Operations (Unaudited)

Quarterly results of operations are as follows:

	Quarter Ended
(in thousands except per share amounts)	October 31			July 31		April 30		January 31
FISCAL YEAR 2005
Total Interest Income	$	6,221		$	6,098	$	6,184	$	6,201
Total Interest Expense		2,769			2,376		2,300		2,228
Net Interest Income		3,452			3,722		3,884		3,973
Provision for loan losses		(1,150	)		—		—		—
Noninterest income		1,308			1,204		1,276		1,105
Noninterest expense		4,027			3,467		3,388		3,605
Income before income taxes		1,883			1,459		1,772		1,473
Income tax expense		469			303		424		304
Net Income	$	1,414		$	1,156	$	1,348	$	1,169
Earnings per common share, basic and diluted	$	1.11		$	0.90	$	1.06	$	0.91
FISCAL YEAR 2004
Total Interest Income	$	5,384		$	6,065	$	6,247	$	6,326
Total Interest Expense		1,421			1,850		1,895		2,038
Net Interest Income		3,963			4,215		4,352		4,288
Provision for loan losses		—			—		—		—
Noninterest income		1,292			1,263		1,405		1,154
Noninterest expense		3,790			3,788		3,934		3,976
Income before income taxes		1,465			1,690		1,823		1,466
Income tax expense		299			372		423		313
Net Income	$	1,166		$	1,318	$	1,400	$	1,153
Earnings per common share, basic and diluted	$	0.86		$	0.97	$	1.03	$	0.85

Guide 3 Statistical Disclosure by Bank Holding Companies

The following tables and schedules show selected comparative financial information required by the Securities and Exchange Commission’s Securities Act Guide 3: Statistical Disclosure by Bank Holding Companies, regarding the business of Metrocorp for the periods shown.

I. Distribution of Assets, Liabilities and Stockholders’ Equity; Interest Rates and Interest Differential

The average balance sheets, analysis of net earnings, and the changes in interest income and expense required to be presented here can be found above in Item 7 of this report under “Average Balances, Interest Rates and Yields.”

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II. Investment Portfolio

     Investment Securities. The following table displays the amortized cost of the Company’s investment security portfolio, at the dates indicated:

October 31,	2005		2004		2003
U.S. Treasury	$	35,171,549	$	32,542,116	$	24,884,420
U.S. government agencies		67,611,208		62,242,253		60,255,773
Tax-exempt municipal		85,058,807		78,059,581		64,216,680
Taxable municipal		57,465,904		53,457,279		43,137,028
Corporate		46,537,992		45,740,977		42,451,584
Trust preferred securities		927,331		926,120		925,005
Mortgage-backed		4,140,154		6,825,213		11,731,444
Total amortized cost	$	296,912,945	$	279,793,539	$	247,601,934

     Investment Securities, Maturities and Yields. The following table displays a summary of the maturity of the Company’s investment securities as of October 31, 2005, and the weighted average yield (no tax equivalent adjustments have been made) for each maturity range:

	Maturity at October 31, 2005
				After 1 Year			After 5Years						Maturity
	1 Year			Through			Through			After			Date Not
	or Less			5 Years			10 Years			10 Years			Applicable
U.S. Treasury	$	7,041,994		$	28,129,555		$	—		$	—		$	—
U.S. government agencies		15,082,542			41,233,266			11,295,399			—			—
Tax-exempt municipal		11,802,451			53,553,180			13,572,729			6,130,447			—
Taxable municipal		11,280,593			43,869,257			2,316,054			—			—
Corporate		8,643,449			34,335,521			3,559,023			—			—
Trust preferred securities		—			—			—			927,331			—
Mortgage-backed		—			—			—			—			4,140,154
Total amortized cost	$	53,851,029		$	201,120,779		$	30,743,205		$	7,057,778		$	4,140,154
Weighted average yield		3.66	%		4.30	%		5.00	%		6.41	%		3.95	%

     Investment Concentrations. At October 31, 2005, the Company held investments from the following issuers which exceeded 10% of stockholders’ equity:

Issuer	Total Book Value		Total Market Value
City of Rock Island, IL	$	5,595,248	$	5,547,079
Village of Milan, IL		4,500,000		4,356,936

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III. Loan Portfolio

     Types of Loans. The composition of the loan portfolio is presented as follows:

	2005		2004		2003		2002		2001
Commercial	$	23,084,454	$	26,599,719	$	24,263,157	$	21,467,040	$	8,997,952
Agricultural production		32,077,481		30,805,048		31,305,214		35,806,554		—
Real estate:
Construction		1,244,334		1,476,757		1,931,682		2,174,255		3,676,604
Residential		41,996,174		40,933,961		43,227,263		56,564,714		35,405,598
Commercial		38,136,664		39,679,155		42,214,567		40,215,734		28,126,467
Farmland		41,052,340		38,518,681		36,489,092		36,564,129		—
Installment		16,206,796		20,189,753		23,669,506		31,539,328		27,250,296
Student		11,818,866		18,386,205		30,993,251		47,024,039		63,972,326
Other		3,602,892		3,168,508		3,271,788		3,326,326		3,859,602
Total Loans		209,220,001		219,757,787		237,365,520		274,682,119		171,288,845
Less allowance for loan losses		2,519,213		3,471,118		3,544,619		4,032,546		1,883,870
Loans, net	$	206,700,788	$	216,286,669	$	233,820,901	$	270,649,573	$	169,404,975

     Maturities and Sensitivities of Loans to Changes in Interest Rates. The following table presents maturities and rate information for loans as of October 31, 2005:

			Due after one				Maturities after one year
	Due in one		year through		Due after		Variable		Fixed
	year or less		five years		five years		rate		Rate
Commercial	$	10,263,462	$	10,035,118	$	2,785,874	$	2,864,005	$	9,956,987
Agricultural production		24,072,147		7,163,363		841,971		2,390,696		5,614,638
Real estate:
Construction		169,915		—		1,074,419		1,074,419		—
Residential		1,979,732		8,929,921		31,086,521		28,572,819		11,443,623
Commercial		3,505,937		10,141,331		24,489,396		25,352,682		9,278,045
Farmland		1,126,869		18,106,578		21,818,893		21,591,066		18,334,405
Installment		1,726,516		11,731,606		2,748,674		651,917		13,828,363
Student		961,104		3,844,416		7,013,346		10,857,762		—
Other		3,602,892		—		—		—		—
Total Loans	$	47,408,574	$	69,952,333	$	91,859,094	$	93,355,366	$	68,456,061

     Risk Elements.

     Nonaccrual, Past Due and Restructured Loans. The following table presents the nonaccrual, past due and restructured loans for the Company as of the stated dates:

October 31,	2005		2004		2003		2002		2001
Loans accounted for on a nonaccrual basis	$	585,972	$	793,863	$	801,558	$	1,470,613	$	326,745
Accruing loans past due 90 days or more		579,527		1,191,556		1,434,846		1,108,838		1,091,413
Troubled debt restructurings		—		—		—		—		—
Totals	$	1,165,499	$	1,985,419	$	2,236,404	$	2,579,451	$	1,418,158

All loans shall be considered as being in nonaccrual status if any of the following exists: the principal or interest has been past due for a period of 90 days or more unless the obligation is both well secured and in the process of collection; payment in full of principal and interest is not expected; or the loan is maintained on a cash basis because of deterioration in the financial position of the borrower(s).

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     Potential Problem Loans. To the best of management’s knowledge, there are no such significant loans that have not been disclosed in the above table.

     Foreign Outstandings. The Company had no foreign outstandings at the end of the last five fiscal years.

     Loan Concentrations. At October 31, 2005, there were no concentrations of loans exceeding 10% of the total loans which are not otherwise disclosed above.

     Other Interest-Bearing Assets. There are no interest-bearing assets required to be disclosed.

IV. Summary of Loan Loss Experience

     Analysis of the Allowance for Loan Losses. The following table summarizes activity in the allowance for loan losses of the Company:

	Year ended October 31,
	2005			2004			2003			2002			2001
Balance at beginning of period	$	3,471,118		$	3,544,619		$	4,032,546		$	1,883,870		$	1,869,630
Charge-offs:
Commercial and agricultural		(23,896	)		(282,004	)		(1,873,398	)		(984,000	)		—
Real estate		—			(3,426	)		(83,712	)		(6,482	)		(150	)
Installment, student, other		(144,504	)		(244,610	)		(359,789	)		(251,533	)		(96,181	)
Total charge-offs		(168,400	)		(530,040	)		(2,316,899	)		(1,242,015	)		(96,331	)
Recoveries:
Commercial and agricultural		287,717			377,415			3,908			304,829			—
Real estate		—			9,995			100			—			—
Installment, student, other		78,778			69,129			58,964			59,071			27,080
Total recoveries		366,495			456,539			62,972			363,900			27,080
Net recoveries (charge-offs)		198,095			(73,501	)		(2,253,927	)		(878,115	)		(69,251	)
Provision charged to expense (income)		(1,150,000	)		—			1,766,000			755,259			83,491
Provision increase due to acquisition		—			—			—			2,271,532			—
Balance at end of period	$	2,519,213		$	3,471,118		$	3,544,619		$	4,032,546		$	1,883,870
Ratio of net charge-offs to average loans outstanding		(0.09	)%		0.03	%		0.85	%		0.31	%		0.04	%

     Allocation of the Allowance for Loan Losses. The distribution of the Company’s allowance for loan losses at the dates indicated is summarized as follows:

	October 31,
	2005					2004					2003					2002					2001
			% of loans					% of loans					% of loans					% of loans					% of loans
			to total					to total					to total					to total					to total
(Dollars in thousands)	Amount		loans			Amount		loans			Amount		loans			Amount		loans			Amount		loans
Commercial and agricultural	$	1,442		64.22	%	$	2,003		61.70	%	$	1,992		56.57	%	$	2,568		48.80	%	$	276		21.67	%
Real estate		295		20.67	%		499		19.30	%		283		19.03	%		212		21.38	%		199		22.82	%
Installment, student, other		613		15.11	%		525		19.00	%		487		24.40	%		494		29.82	%		727		55.51	%
Unallocated		169		—			444		—			783		—			759		—			682		—
Total	$	2,519		100.00	%	$	3,471		100.00	%	$	3,545		100.00	%	$	4,033		100.00	%	$	1,884		100.00	%

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V. Deposits

The average amount of deposits and average rates paid on deposits by category for the years ended October 31, 2005, 2004, and 2003 are discussed above in Item 7 of this report under “Average Balances, Interest Rates and Yields.” The following table presents time certificates of deposit in amounts of $100,000 or more by maturity as of October 31, 2005:

	Maturity
			Over 3
			months		Over 6 months
	3 months		through 6		through 12		Over 12
	or less		Months		months		months		Total
Time certificates of $100,000 or more	$	39,160,309	$	9,801,598	$	12,758,032	$	7,592,905	$	69,312,844

VI. Return on Equity and Assets

Return on equity, return on assets and other ratios can be found in Item 6 of this report.

VII. Short-Term Borrowings

The average balance for each category of short-term borrowings was under 30% of year-end stockholders’ equity during the years ended October 31, 2005, 2004, and 2003. Therefore, no detailed information on short-term borrowings is required to be presented.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company’s income is dependent to a large degree on its net interest income. Net interest income is susceptible to interest rate risk to the degree that interest-bearing liabilities mature or reprice at a different time than interest-earning assets and to the degree that market interest rates change over that time. When interest-bearing liabilities mature or reprice more quickly than interest-earning assets in a given period, a significant increase in market interest rates could adversely affect net interest income. Conversely, when interest-earning assets mature or reprice more quickly than interest-bearing liabilities, falling interest rates could result in a decrease in net interest income. This risk is known as interest rate risk and it is the Company’s primary market risk.

The Company currently focuses lending efforts toward originating and purchasing competitively priced adjustable-rate and fixed-rate loan products with short to intermediate terms to maturity, generally 5 years or less. This theoretically allows the Company to maintain a portfolio of loans that will have relatively little sensitivity to changes in the level of interest rates while providing a reasonable spread to the cost of liabilities used to fund the loans.

One objective of the Company’s investment portfolio is to provide the liquidity necessary to meet the funding needs of the loan portfolio. The investment portfolio is also used in the ongoing management of changes to the Company’s asset/liability mix, while contributing to profitability through earnings flow. The investment policy generally calls for funds to be invested among various categories of security types and maturities based upon the Company’s needs for liquidity, achieving a proper balance between minimizing risk while maximizing yield, providing collateral for borrowings, and fulfilling the Company’s asset/liability management goals.

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The Company’s cost of funds responds to changes in interest rates due to the relatively short-term nature of its deposit portfolio, and due to the relatively short-term nature of a portion of its borrowed funds. Consequently, the results of operations are generally influenced by the level of short-term interest rates. The Company offers a range of maturities on its deposit products at competitive rates and monitors the maturities on an ongoing basis. The Company uses borrowed funds for both the purchase of investment securities and for day-to-day cash management.

The Company emphasizes and promotes its savings, money market, demand and interest-bearing demand accounts and, subject to market conditions, certificates of deposit with maturities of three months through five years, principally in its primary market area. The savings and interest-bearing demand accounts tend to be less susceptible to rapid changes in interest rates.

In managing its asset/liability mix, the Company, at times, depending on the relationship between long-term and short-term interest rates, market conditions, and consumer preference, may place somewhat greater emphasis on maximizing its net interest margin than on strictly matching the interest rate sensitivity of its assets and liabilities. Management believes the increased net income that may result from an acceptable mismatch in the actual maturity or repricing of its asset and liability portfolios can, at times, provide sufficient returns to justify the increased exposure to sudden and unexpected increases in interest rates that may result from such a mismatch. The Company has established limits, which may change from time to time, on the level of acceptable interest rate risk. There can be no assurance, however, that in the event of an adverse change in interest rates, the Company’s efforts to limit interest rate risk will be successful.

The Company manages its interest rate risk by maintaining an appropriate balance between interest sensitive assets and interest sensitive liabilities to reduce interest rate risk exposure while also providing liquidity to satisfy the cash flow requirements of operations and to meet customers’ fluctuating demands for funds, in terms of loan requests and deposit withdrawals. The Company’s asset/liability risk policy sets the necessary guidelines for managing the volume and mix of assets and other funding sources. In addition, the Company has established a system for monitoring its net interest rate sensitivity position.

Interest rate risk is managed by the Company’s Rate Committee (Committee), which performs asset/liability management at Metrobank’s level in accordance with policies approved by the Company’s Board of Directors. The Committee is comprised of the Bank’s President, Controller, Senior Lender, Cashier, Trust Officer, Retail Manager and Marketing Officer. The Committee formulates strategies based on what they believe to be appropriate levels of interest rate risk. In determining the appropriate level of interest rate risk, the Committee considers the impact on earnings, capital levels and general economic conditions.

The Company uses a net interest income simulation model to estimate near-term risk due to changes in interest rates. The model, which is updated quarterly, incorporates substantially all assets and liabilities together with forecasted changes in the balance sheet and assumptions that reflect the current interest rate environment. Balance sheet changes are based on expected prepayments of loans and securities. The Committee uses the model to simulate the effect of immediate and sustained parallel shifts in the yield curve of 100 and 200 basis points. The results from the simulation are normally reviewed by the Committee quarterly and are used to guide the Committee’s asset/liability strategy. Asset/liability risk guidelines approved by the Company’s Board of Directors generally limit the estimated decline in net interest income over the succeeding 12 months. In the event the forecasted decline exceeds 25% of the forecasted net interest income given a 200 basis points change in interest rates, the Board will increase its scrutiny and may change its strategy, if necessary. As of October 31, 2005, the estimated effect of an immediate 200 basis point increase in rates was a decrease in forecasted net interest income for 12 months of 11.08%. The estimated effect of an immediate 200 basis point decrease in rates was an increase in forecasted net interest income for 12 months of 5.67%.

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The Committee has attempted to manage the Company’s interest rate risk given that there has been an increasing rate environment for more than one year. Since June 2004, the Federal Open Market Committee began increasing short-term interest rates in twenty-five (25) basis point increments, to a more normal level, from historically low levels. Through November 1, 2005, there have been twelve (12) such increases. As this happened, longer term rates moderated creating a flattening in the yield curve. This action is indicative of limited concern about long-term inflation at this time. While management does not anticipate a significant shift in market interest rates in the near future, it does believe that there is less risk from declining interest rates than from rising interest rates, and interest rate risk management has reflected this belief.

Interest-earning assets and interest-bearing liabilities are those which have yields or rates which are subject to change within a future time period due to maturity of the instrument or changes in the rate environment. “GAP” refers to the difference between interest-earning assets and interest-bearing liabilities repricing within given time frames. As a result, major fluctuations in net interest income and net earnings could occur due to imbalances between the amounts of interest-earning assets and interest-bearing liabilities, as well as different repricing characteristics. GAP management seeks to protect earnings by maintaining an appropriate balance between interest-earning assets and interest-bearing liabilities in order to minimize fluctuations in the net interest margin and net earnings in periods of volatile interest rates.

The following table summarizes the Company’s interest rate sensitivity analysis at October 31, 2005:

	Volumes Subject to Repricing Within
				Over three			Over one
	Three			months			year
	months			through			through			Over
	or less			one year			five years			five years			Total
	(Dollars in thousands)
Interest-earning assets:
Federal funds sold	$	8,650		$	—		$	—		$	—		$	8,650
Investment securities		22,625			34,212			199,468			37,820			294,125
Loans held for sale		14,160			—			—			—			14,160
Loans		49,948			13,414			135,517			10,341			209,220
Other		544			—			—			—			544
Total interest-earning assets	$	95,927		$	47,626		$	334,985		$	48,161		$	526,699
Interest-bearing liabilities:
Deposits
Interest-bearing demand and money market accounts	$	46,808		$	89,574		$	84,751		$	—		$	221,133
Savings		8,253			12,380			20,634			—			41,267
Time, $100,000 and over		39,160			22,560			7,593			—			69,313
Time, under $100,000		36,718			60,283			34,439			—			131,440
Short-term borrowings		4,748			—			—			—			4,748
Federal Home Loan Bank advances		—			—			1,000			—			1,000
Notes payable		5,434			—			—			—			5,434
Junior subordinated debentures		10,309			—			—			—			10,309
Total interest-bearing liabilities	$	151,430		$	184,797		$	148,417		$	—		$	484,644
Periodic gap	$	(55,503	)	$	(137,171	)	$	186,568		$	48,161
Cumulative period gap		(55,503	)		(192,674	)		(6,106	)		42,055
Cumulative period gap to total assets		(9.6	%)		(33.3	%)		(1.1	%)		7.3	%

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The data in this table incorporates contractual repricing characteristics as well as an estimate of the actual repricing characteristics of the Company’s assets and liabilities. Based on the estimate, 20% of the interest-bearing demand and savings deposits are included in the three months or less category, 30% in the over three months through one year category, and the remainder in the over one year through five years category. Also, 25% of the money market accounts are included in the three months or less category with the remainder in the over three months through one year category.

Certain shortcomings are inherent in the method of analysis presented in the foregoing table. For example, although certain assets and liabilities may have similar maturities or periods to reprice, they may react in different degrees to changes in market interest rates. Also, the interest rates on certain types of assets and liabilities may fluctuate in advance of changes in market interest rates, while interest rates on other types may lag behind and over the life of the asset. Further, in the event of a change in interest rates, prepayment and early withdrawal levels would likely deviate significantly from those assumed in calculating the table.

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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Metrocorp’s financial statements and related supplementary data may be found beginning at page F-1 of this report and are incorporated herein by reference:

Report of Independent Registered Public Accounting Firm on the Financial Statements	F-1
Consolidated Balance Sheets as of October 31, 2005 and 2004	F-2
Consolidated Statements of Income for the years ended October 31, 2005, 2004 and 2003	F-3
Consolidated Statements of Changes in Stockholders’ Equity for the years ended October 31, 2005, 2004 and 2003	F-4
Consolidated Statements of Cash Flows for the years ended October 31, 2005, 2004 and 2003	F-6
Notes to Consolidated Financial Statements	F-8

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES

Metrocorp’s principal executive officer, Gary D. Andersen, and principal financial officer, John R. McEvoy, Jr., evaluated the effectiveness of Metrocorp’s disclosure controls and procedures as of October 31, 2005 (“Evaluation Date”). Based on that evaluation, they concluded that as of the Evaluation Date, Metrocorp’s disclosure controls and procedures are effective to allow timely communication to them of information relating to Metrocorp and Metrobank required to be disclosed in its filings with the Commission under the Exchange Act. Disclosure controls and procedures are Company controls and other procedures that are designed to ensure that information required to be disclosed by the Company in the reports that it files under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms.

There were no changes in the Company’s internal control over financial reporting that occurred during the fourth quarter of the year ended October 31, 2005, that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

ITEM 9B. OTHER INFORMATION

None.

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The following table sets forth certain information regarding the executive officers and directors of Metrobank and Metrocorp:

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Name	Age		Current Positions
Gary D. Andersen		58	Director and President of Metrocorp and Metrobank; member of Metrocorp Executive Committee and Salary Committee
Nancy R. Hamilton		55	Director of Metrocorp and Metrobank; Senior Vice President, Trust Officer of Metrobank; Vice President of Metrocorp
Marcus V. Hobert		50	General Counsel and Compliance Officer of Metrobank
John T. Kustes		55	Senior Vice President, Operations and Cashier of Metrobank
John R. McEvoy, Jr.		52	Senior Vice President, Controller of Metrobank
Kirk A. Metzger		38	Senior Vice President, Trust Officer
Bart D. Ottens		40	Senior Vice President, Lending of Metrobank
Roland D. Petersen		69	Director of Metrocorp and Metrobank; member of Metrocorp Audit Committee
Ben H. Ryan, Jr.		80	Chairman of Metrocorp and Metrobank; member of Metrocorp Executive Committee, Salary Committee and Audit Committee
David A. Skinner		55	Director of Metrocorp and Metrobank; member of Metrocorp Salary Committee and Chairman of Audit Committee
Julius J. Van Paemel		62	Director and Secretary of Metrocorp and Metrobank; Senior Vice President of Metrobank; Vice President of Metrocorp; member of Metrocorp Executive Committee

Metrocorp’s Bylaws authorize 5 to 25 directors. The six directors that serve on Metrocorp’s Board of Directors also comprise the Board of Directors of Metrobank. Each of Metrocorp’s and Metrobank’s executive officers serves at the discretion of the respective Board of Directors. All directors hold office until the next annual meeting of stockholders or until their successors are elected and qualified or until their death, resignation or removal. Officers are appointed by the Board of Directors and hold office until their successors are appointed or until their resignation or removal.

Gary Andersen has served as director of Metrocorp and Metrobank since 1985. Mr. Andersen joined Metrobank in 1975 and has served as President since 1993. Mr. Andersen is also a director of Genesis Health System, Illini Hospital, Illinois Quad City Civic Center Authority and R.E.D.E.E.M., an economic development organization.

Nancy Hamilton has served as Senior Vice President, Trust Officer of Metrobank since 1990 and as a director of Metrocorp and Metrobank since 2000.

Marcus Hobert has served as General Counsel and Compliance Officer of Metrobank since 1986.

John Kustes has served as Senior Vice President, Operations and Cashier of Metrobank since December 2003. From 2000 until December 2003, Mr. Kustes served as Vice President, Operations of Metrobank.

John McEvoy has served as Senior Vice President, Controller of Metrobank since 2003. From 1993 until 2003, Mr. McEvoy served as Vice President, Cashier of Metrobank.

Kirk A. Metzger has served as Senior Vice President, Trust Officer since August 2005. He previously served as a Vice President and Senior Trust Officer in the trust department of a regional bank.

Bart Ottens has served as Senior Vice President of Metrobank since December 2004. From 2001 until December 2004, Mr. Ottens served as Vice President of Metrobank.

Roland Petersen has served as a director of Metrocorp and Metrobank since 2003. Mr. Petersen is President of Petersen Stock Farm, Inc., a family farming operation.

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Ben Ryan has served as Chairman of the Board of Metrocorp and Metrobank since 1984. Mr. Ryan joined Metrobank in 1954 serving as C.E.O. since 1967 before he retired in 1993. Mr. Ryan graduated from the University of Illinois and served as an assistant bank examiner for the State of Illinois followed by the position of a foreign branch inspector in Latin America for what is now Citibank.

David Skinner has served as a director of Metrocorp and Metrobank since 2004. Mr. Skinner has worked as an engineer at John Deere & Co. since 1978. He received an MBA degree from Kellogg School of Management, Northwestern University. Mr. Skinner is also a member of the Advisory Board of the Salvation Army of the Iowa Quad Cities.

Julius Van Paemel has served as Senior Vice President, Consumer Lending of Metrobank and as Secretary and a director of both Metrocorp and Metrobank since 1989. Mr. Van Paemel joined Metrobank following Metrobank’s acquisition of Colona Avenue State Bank where he served as President.

Board of Directors and Board Committees

Metrocorp’s Board of Directors met 16 times during the fiscal year ended October 31, 2005 and each director attended at least 75% of the meetings of the Board and Board committees on which they served. Although the Company has no formal policy, it encourages all Board members to attend the annual shareholders meeting. All directors attended the annual shareholders meeting held on December 20, 2004.

The Board of Directors of Metrocorp has established an Audit Committee that operates under a written charter, a copy of which is attached as an exhibit to this report. The purpose of the Company’s Audit Committee is to review and coordinate the audit conducted by Metrocorp’s independent auditors and matters relating to internal control systems. In performing this function, the Audit Committee reviews reports from the independent auditors and meets separately without representatives of senior management. The Audit Committee is comprised of Mr. Skinner (Chairman), Mr. Ryan and Mr. Petersen. In February 2006 the Board affirmatively determined that each member of the Audit Committee is independent under applicable SEC regulations and is financially literate. The Board has determined that Mr. Ryan is the Audit Committee financial expert as defined by Item 401(h) of SEC Regulation S-K. The committee meets on a monthly basis.

Metrocorp’s Salary Committee has the limited role of making recommendations to the Board of Directors with respect to the compensation of executive officers. It does not operate under a written charter. The committee is comprised of Mr. Skinner and Mr. Ryan, both of whom are independent, along with President Andersen. The independent directors meet in executive session to determine the compensation for Metrocorp’s President.

The Board of Directors has established an Executive Committee which may, while the Board of Directors is not in session, exercise all or any such of the powers of the Board of Directors as the Board may lawfully delegate. The Executive Committee shall report all its actions at the next regular meeting of the Board of Directors. It does not operate under a written charter. Members of the committee are Mr. Ryan, Mr. Andersen, and Mr. Van Paemel.

Members of Metrocorp’s Nominating Committee are Mr. Andersen and Ms. Hamilton. Nominations are approved by the entire Board of Directors. The Board has not established any specific standards for directors. However, the Board may identify certain skills or attributes as being particularly desirable for specific director nominees in order to complement the existing Board composition. Metrocorp does consider nominees recommended by shareholders.

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Code of Ethics and Code of Business Conduct

Metrocorp has adopted a code of business conduct that applies to all officers, directors and employees and a code of ethics that applies to principal executive officers and senior financial officers. Copies of both codes are attached as exhibits to this report and copies are available without charge, upon request, to Gary D. Andersen at 1523 8th Street, East Moline, Illinois 61244.

Indemnification, Insurance and Limitation of Liability

Under its Bylaws, Metrocorp provides for indemnification, to the maximum extent permitted by law, of any person who is or was a director, officer or employee of Metrocorp or Metrobank against any claim, liability or expense arising against him or her because he or she is or was a director, officer or employee or was serving another entity as a director, officer, partner, trustee, employee or fiduciary at Metrobank’s or Metrocorp’s request. In September 2005, Metrocorp entered into indemnification agreements with each of its directors which are described under Item 11 of this report. Metrocorp also maintains director and officer insurance to help meet its indemnification requirements.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of Metrocorp or Metrobank pursuant to the foregoing provisions, or otherwise, Metrocorp and Metrobank have been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by Metrocorp or Metrobank of expenses incurred or paid by a director, officer, or controlling person of Metrocorp or Metrobank in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, each of Metrocorp and Metrobank will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

Section 16(a) Beneficial Ownership Reporting Compliance

The directors, executive officers and 10% or more beneficial owners of Metrocorp’s common stock were not subject to the reporting requirements of Section 16(a) of the Exchange Act during the fiscal year ended October 31, 2005.

ITEM 11. EXECUTIVE COMPENSATION

The table below summarizes information concerning compensation received by Metrocorp’s President and the three most highly compensated executive officers who earned more than $100,000 in salary and bonuses for the fiscal year ended October 31, 2005. Metrocorp does not have any plan which awards restricted stock awards, stock appreciation rights or stock options, any long-term incentive plans or other forms of long-term compensation.

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			Annual Compensation
	Year ended						All Other
Name and Title	October 31,		Salary		Bonus		Compensation(1)(2)
Gary D. Andersen		2005	$	208,000	$	0	$	8,610
President		2004		208,000		0		42,763
		2003		202,667		0		36,467
Julius J. Van Paemel		2005		111,100		0		6,451
Senior Vice President,		2004		111,101		0		25,449
Consumer Lending		2003		111,101		0		22,427
Nancy R. Hamilton		2005	$	107,456		0		3,952
Senior Vice President/Trust Officer		2004		105,845		0		22,211
		2003		102,347		0		18,762
Marcus V. Hobert		2005	$	106,703		0		6,109
General Counsel and		2004		105,104		0		24,004
Compliance Officer		2003		101,629		0		20,640

(1)	Includes payments for premiums for health insurance and term life insurance for all years shown.
(2)	Includes Metrocorp contributions to the Employee Stock Ownership Plan for the years of 2004 and 2003. The ESOP was terminated in 2004.

Salary Committee Interlocks and Insider Participation

No member of Metrocorp’s Salary Committee is an officer, former officer or employee of Metrocorp or Metrobank, except for Mr. Ryan who retired from Metrobank in 1993, and Mr. Andersen. Mr. Andersen is excused when the President’s salary is discussed. None of the Company’s executive officers had any interlocking relationship with any other for-profit entity during the fiscal year ended October 31, 2005.

Change of Control Severance Plan

On September 22, 2005, Metrocorp adopted a Change of Control Severance Plan for employees of the Company and its subsidiaries. This plan generally provides that if an employee is terminated without cause or resigns for good reason, as defined in the plan, following a “change of control,” such employee shall be entitled to receive a percentage of his base salary calculated depending on whether such employee is a non-officer, a junior officer, a vice president or a senior executive. In addition, the employee shall be reimbursed for COBRA coverage premiums in certain situations. A “change of control” generally means an acquisition of 50% or more of the Company’s securities, an acquisition of 25% or more of Metrocorp’s securities along with election of a new board, a transfer of substantially all of Metrocorp’s assets or a merger of the Company.

Stay Bonus Plan

On November 11, 2005, Metrocorp adopted a Stay Bonus Plan for employees of Metrocorp and its subsidiaries. This plan generally provides that upon a “change of control,” each employee who has been continually employed since adoption of the plan shall receive a payment in the amount of 12% of his annual base compensation. This plan does not apply to those key employees who executed the Incentive Bonus Agreements described below or to the Company’s inside directors. A “change of control” generally means an acquisition of 50% or more of Metrocorp’s securities, an acquisition of 25% or more of the Company’s securities along with election of a new board, a transfer of substantially all of the Company’s assets or a merger of Metrocorp.

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Executive Agreements

Metrocorp has entered into the following agreements with its executive officers or directors:

     Indemnification Agreement. In September 2005 Metrocorp entered into indemnification agreements with each of its directors which generally provide that each director shall be indemnified to the fullest extent provided by law against all liabilities, attorneys’ fees and other costs incurred by the director and arising out of his status as a director of Metrocorp. These indemnification rights are not limited by any change of control of the Company and continue regardless of whether a director continues to serve as a director.

     Incentive Bonus Agreement. In October 2005 Metrocorp entered into incentive bonus agreements with the following executives and other employees of Metrobank: Bart Ottens, Branden Alexander, Doug Vanderlaan, Mark Milder, Rich Skrivseth and Lori Welsh. These agreements generally provide that when a “bonus event” occurs, and the employee has remained in continuous employment with Metrobank, then Metrobank shall pay a retention bonus of 20% of the employee’s annual base salary, less taxes. A “bonus event” is generally defined as a merger of Metrocorp into another corporation or a transfer of substantially all of the Company’s assets to another entity.

Director Compensation

During the fiscal year ended October 31, 2005, directors who are not also executive officers received $1,000 per board meeting for their service on the Board. The outside directors who serve on a Board committee received $50 per meeting for their service. Directors who are also executive officers receive no additional compensation for their role as directors. Each director also was covered by directors’ and officers’ liability insurance.

401(k) Plan

Metrobank maintains a 401(k) salary reduction plan covering all full-time employees of Metrobank who have completed one year of employment with 1,000 hours of service and are age 21 or older. Employees may contribute a portion of their eligible salaries to the plan. Metrobank did not make any contributions to the plan during the years ended October 31, 2005, 2004 and 2003.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The following table sets forth certain information regarding the beneficial ownership of Metrocorp’s common stock as of February 20, 2006, by (1) each of the Company’s directors and executive officers, (2) each shareholder known to own beneficially 5% or more of the outstanding common stock and (3) all of the directors and executive officers as a group. Unless otherwise indicated, based on information furnished by such shareholders, management believes that each person has sole voting and dispositive power over his or her shares.

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Common Stock Ownership

	Number of shares			Percentage of common
Beneficial Owners	beneficially owned			stock outstanding(1)
5% Holders
Cede & Co. P.O. Box 20 Bowling Green Station New York, NY 10004		207,099			17.46	%
Directors and Executive Officers
Gary D. Andersen		13,816	(2)		1.16	%
Nancy R. Hamilton		10,140	(3)			*
Marcus V. Hobert		22,020	(4)		1.86	%
John T. Kustes		2,300	(5)			*
John R. McEvoy, Jr.		5,781				*
Kirk A. Metzger		0				*
Bart D. Ottens		1,991	(6)			*
Roland D. Petersen		5,250				*
Ben H. Ryan, Jr.		8,130				*
David A. Skinner		300				*
Julius J. Van Paemel		11,223				*
Directors and executive officers as a group (11 persons)		80,951			6.83	%

*	Indicates ownership which does not exceed 1.0%.
(1)	The percentage beneficially owned was calculated based on 1,186,068 shares of common stock outstanding, with the 1,298,962 shares of treasury stock not included.
(2)	Includes 336 shares owned jointly with his spouse.
(3)	Includes 9,215 shares held by Primevest Financial for the benefit of Ms. Hamilton.
(4)	Includes 6,920 shares owned by Mr. Hobert’s spouse and 10,100 shares held by Primevest Financial for the benefit of Mr. Hobert.
(5)	Includes 2,000 shares held by Citigroup Global Markets, Inc. for the benefit of Mr. Kustes.
(6)	Includes 300 shares owned jointly with his spouse, 1,124 shares held by Primevest Financial for the benefit of Mr. Ottens, and 567 shares held by Primevest Financial for the benefit of his spouse.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Metrobank does not currently purchase any goods and/or services from any of its directors or executive officers or any of their related businesses in the normal course of business. In the event of any such transaction it would be subject to approval by the Board of Directors.

Some of Metrocorp’s directors, executive officers and shareholders who own 5% or more of the Company’s common stock and their associates, which include corporations, partnerships and other organizations in which they are officers or partners or in which they or their immediate families have at least a 5% interest, are occasionally Metrobank’s customers. During the fiscal year ended October 31, 2005, Metrobank made loans in the ordinary course of business to the directors, executive officers and principal shareholders and their associates. At October 31, 2005, these loans aggregated approximately $826,980. It is the policy of Metrobank that if such loans are made, they are made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with persons unaffiliated with Metrobank and do not involve more than the normal risk of collectibility or present other unfavorable features. The loans noted in this paragraph were made on substantially those terms. Loans to directors, executive officers and principal shareholders are subject to

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limitations contained in the Federal Reserve Act, the principal effect of which is to require that extensions of credit by us to executive officers, directors and principal shareholders satisfy the foregoing standards. Metrocorp and Metrobank expect to have such transactions or transactions on a similar basis with our directors, executive officers and principal shareholders and their associates in the future.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

McGladrey & Pullen LLP, Certified Public Accountants, provided accounting and auditing services to Metrocorp and its subsidiaries during the year ended October 31, 2005.

Audit Fees, Audit Related Fees, Tax Fees and All Other Fees

The following table presents fees for professional audit services rendered by McGladrey & Pullen, LLP for the audit of Metrocorp’s annual financial statements for the years ended October 31, 2005 and 2004, and fees billed for other services rendered by McGladrey & Pullen, LLP and its affiliate RSM McGladrey, Inc. during such years.

	Year Ended October 31,
	2005		2004
Audit fees(1)	$	62,000	$	52,200
Audit-related fees (2)		12,722		10,800
Tax fees(3)		11,356		12,871
All other fees(4)		3,415		—
Total	$	89,493	$	75,871

(1)	Audit fees represent fees for professional services provided for the audit of Metrocorp’s annual financial statements.
(2)	Fees in connection with benefit plans.
(3)	Tax fees consist of fees for tax compliance services for Metrocorp and its subsidiaries.
(4)	All other fees consist primarily of accounting research assistance.

The charter of the Audit Committee adopted in February 2006 provides that the committee shall pre-approve all auditing services and non-audit services (other than de minimus non-audit services) to be provided by the independent auditor. The committee then communicates its approval to management. The Audit Committee pre-approved 100% of the audit-related services, tax services and all other services performed by McGladrey & Pullen, LLP and RSM McGladrey, Inc. during the fiscal year ended October 31, 2005.

Independence

The Audit Committee considered the effect that provision of the services described under “tax fees” and “all other fees” above may have on the independence of McGladrey & Pullen, LLP. These fees amounted to approximately 17% of the total fees paid during the fiscal year ended October 31, 2005. The Audit Committee approved these services and determined they were compatible with maintaining the independence of McGladrey & Pullen, LLP as Metrocorp’s principal accountant.

Reporting

Metrocorp and its subsidiaries have adopted a procedure for employee concerns and complaints regarding accounting or auditing matters which provides for anonymous reporting of accounting concerns.

- 49 -

PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) Documents filed as part of this report:

1.	Financial Statements. The consolidated financial statements of the Registrant are included beginning at page F-1 of this report and are incorporated herein by reference.
2.	Financial Statement Schedules. Schedules have been omitted because they are not applicable or are not required under the instructions contained in Regulation S-X or because the information required to be set forth therein is included in the consolidated financial statements or notes thereto contained in this report.
3.	Exhibits. The following documents are included or incorporated by reference in this annual report on Form 10-K and this list includes the Exhibit Index.

Exhibit
Number	Description
3.1	Articles of Incorporation of Metrocorp, as amended to date
3.2	Bylaws of Metrocorp
4.1	Amended and Restated Trust Agreement among Metrocorp, Inc., Wilmington Trust Company and the Administrators named therein dated November 1, 2001
4.2	Subordinated Loan Agreement between Metrocorp, Inc. and Metrocorp Capital Trust I dated November 1, 2001
4.3	Guarantee Agreement by Metrocorp, Inc. dated November 1, 2001
4.4	Form of Trust Preferred Certificate of Metrocorp Capital Trust I
4.5	Certificate of Trust of Metrocorp Capital Trust I (Exhibit A to Exhibit 4.1 hereto)
10.1	Form of Indemnification Agreement between Metrocorp and each director of Metrocorp
10.2	Form of Incentive Bonus Agreement between Metrocorp and each of Gary Andersen, Nancy Hamilton, Julius Van Paemel, Bart Ottens and other employees
10.3	Change of Control Severance Plan dated September 22, 2005
10.4	Stay Bonus Plan dated November 11, 2005
10.5	Renewal of Lease Agreement between Wal-Mart Stores, Inc. and Metrobank, NA dated July 11, 2000
10.6	Replacement Revolving Note payable by Metrocorp to La Salle Bank, N.A. dated August 5, 2002, due July 24, 2008
10.7	Loan Agreement between Metrobank and La Salle Bank, NA dated November 1, 2001, as amended by the First Amendment to Loan Agreement dated November 30, 2001, and the Second Amendment to Loan Agreement dated August 5, 2002
14.1	Code of Ethics for Principal Executive Officers and Senior Financial Officers
14.2	Code of Business Conduct
21.1	Metrobank, NA, Community Insurance, Inc. and Metrocorp Capital Trust I are the only subsidiaries of the Registrant
24.1	Power of Attorney (included on the signature page)
31.1	Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer

- 50 -

Exhibit
Number	Description
31.2	Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer
32.1	Section 1350 Certification of Chief Executive Officer
32.2	Section 1350 Certification of Chief Financial Officer
99.1	Charter of the Audit Committee of Metrocorp, Inc.

(b)	Exhibits filed:
	See Exhibit Index under Item 15(a)(3) above for the list of exhibits required to be filed by Item 601 of Regulation S-K with this report.
(c)	Financial Statement Schedules filed:
	See Item 15(a)(2) above.

- 51 -

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

METROCORP, INC.
(Registrant)
By:	/s/ Gary D. Andersen	February 27, 2006
	Gary D. Andersen, President	(Date)
	(principal executive officer)
By:	/s/ John R. McEvoy, Jr.	February 27, 2006
	John R. McEvoy, Jr., Senior Vice President/Controller	(Date)
	(principal financial officer)

Pursuant to the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the Registrant and in the capacities and on the dates indicated. Each person whose signature appears below hereby constitutes and appoints Gary D. Andersen and John R. McEvoy, Jr. with full power to each of them to act without the other, as the undersigned’s true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for the undersigned and in the undersigned’s name, place and stead, in any and all capacities (until revoked in writing), to sign this Form 10-K and any and all amendments (including post-effective amendments) thereto, to file the same, together with all exhibits thereto and documents in connection therewith, with the Securities and Exchange Commission, to sign any and all applications, registration statements, notices and other documents necessary or advisable to comply with the applicable state securities authorities, granting unto said attorney-in-fact and agent, or his or their substitute or substitutes, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises in order to effectuate the same as fully to all intents and purposes as the undersigned might or could do if personally present, thereby ratifying and confirming all that said attorneys-in-fact and agents, or his or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

- 52 -

METROCORP, INC.
(Registrant)
By:	/s/ Gary D. Andersen	February 27, 2006
Gary D. Andersen, Director
By:	/s/ Nancy R. Hamilton	February 27, 2006
Nancy R. Hamilton, Director
By:	/s/ Roland D. Petersen	February 27, 2006
Roland D. Petersen, Director
By:	/s/ Ben H. Ryan, Jr.	February 27, 2006
Ben H. Ryan, Jr., Director
By:	/s/ David A. Skinner	February 27, 2006
David A. Skinner, Director
By:	/s/ Julius J. Van Paemel	February 27, 2006
Julius J. Van Paemel, Director

- 53 -

McGladrey & Pullen

Certified Public Accounts

R E P O R T   O F   I N D E P E N D E N T   R E G I S T E R E D
P U B L I C   A C C O U N T I N G   F I R M

To the Board of Directors and Stockholders
Metrocorp, Inc.
East Moline, Illinois

We have audited the accompanying consolidated balance sheets of Metrocorp, Inc. and subsidiaries as of October 31, 2005 and 2004, and the related consolidated statements of income, changes in stockholders’ equity, and cash flows for the years ended October 31, 2005, 2004, and 2003. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Metrocorp, Inc. and subsidiaries as of October 31, 2005 and 2004, and the results of their operations and their cash flows for the years ended October 31, 2005, 2004, and 2003 in conformity with U.S. generally accepted accounting principles.

/s/ McGladrey & Pullen, LLP

Davenport, Iowa

November 18, 2005

McGladrey & Pullen, LLP is a member firm of RSM International —

an affiliation of separate and independent legal entities.

F - 1

C O N S O L I D A T E D   B A L A N C E   S H E E T S

October 31, 2005 and 2004

	2005			2004
Assets
Cash and due from banks (Note 2)	$	20,242,642		$	24,419,553
Federal funds sold		8,650,000			5,250,000
Securities available for sale (Note 4)		294,125,263			285,441,610
Loans held for sale (Note 5)		14,160,176			13,409,164
Loans (Notes 6 and 18)		209,220,001			219,757,787
Allowance for loan losses		(2,519,213	)		(3,471,118	)
Loans, net		206,700,788			216,286,669
Accrued interest receivable		7,385,857			7,232,699
Premises and equipment, net (Note 7)		9,045,775			8,668,876
Intangible assets, net (Note 8)		10,763,201			10,962,444
Other assets		7,903,000			4,018,315
Total assets	$	578,976,702		$	575,689,330
Liabilities and Stockholders’ Equity
Liabilities:
Deposits (Note 9):
Demand deposits, noninterest-bearing	$	48,257,954		$	47,425,625
Interest-bearing demand and money market accounts		221,133,113			209,789,737
Savings		41,267,265			41,337,897
Time, $100,000 and over		69,312,844			80,102,480
Time, other		131,440,187			121,359,364
Total deposits		511,411,363			500,015,103
Short-term borrowings (Note 10)		4,747,578			4,733,657
Federal Home Loan Bank advances (Note 11)		1,000,000			1,000,000
Notes payable (Note 13)		5,433,970			6,164,841
Junior subordinated debentures (Note 14)		10,309,278			10,309,278
Accrued interest payable and other liabilities		2,534,003			2,522,912
Total liabilities		535,436,192			524,745,791
Commitments and Contingencies (Note 16)
Redeemable common stock held by
Employee Stock Ownership Plan Participants (Note 12) (2005 — 144,421 shares; 2004 — 328,676 shares)		6,491,724			11,766,601
Stockholders’ Equity (Note 17):
Common stock, $.20 par value; shares authorized 3,000,000; shares issued and outstanding 2005 — 2,340,609 and 1,041,647; 2004 — 2,156,354 and 1,038,337, respectively		468,122			431,271
Additional paid-in capital		4,406,006			4,059,606
Retained earnings		50,506,859			40,988,823
Accumulated other comprehensive income (loss)		(1,708,849	)		3,462,268
Unearned ESOP shares		—			(53,777	)
Treasury stock, at cost (2005 — 1,298,962 shares; 2004 — 1,118,017 shares)		(16,623,352	)		(9,711,253	)
Total stockholders’ equity		37,048,786			39,176,938
Total liabilities and stockholders’ equity	$	578,976,702		$	575,689,330

See Notes to Consolidated Financial Statements.

F - 2

     C O N S O L I D A T E D   S T A T E M E N T S   O F   I N C O M E

     Years Ended October 31, 2005, 2004, and 2003

	2005			2004		2003
Interest income:
Loans	$	13,311,049		$	12,857,018	$	15,766,382
Securities:
Taxable		8,372,062			8,411,899		8,159,476
Exempt from federal income tax		2,711,725			2,569,788		2,077,857
Federal funds sold		52,664			9,442		69,392
Other		256,061			173,704		156,312
Total interest income		24,703,561			24,021,851		26,229,419
Interest expense:
Interest-bearing demand and money market accounts		2,972,640			2,453,249		2,547,565
Savings deposits		212,688			199,964		212,230
Time deposits		5,097,237			3,562,693		5,465,681
Short-term borrowings		292,357			157,877		49,877
Federal Home Loan Bank advances		137,831			108,842		87,959
Notes payable		290,592			216,581		246,834
Junior subordinated debentures		670,103			504,725		—
Trust preferred securities		—			—		495,973
Total interest expense		9,673,448			7,203,931		9,106,119
Net interest income		15,030,113			16,817,920		17,123,300
Provision for loan losses (Note 6)		(1,150,000	)		—		1,766,000
Net interest income after provision for loan losses		16,180,113			16,817,920		15,357,300
Noninterest income:
Service charges on deposit accounts		1,324,598			1,410,077		1,667,304
Gains on sales of loans		648,074			753,385		1,516,534
Securities gains, net		62,268			19,931		206,337
Trust fees		475,502			550,881		517,342
ATM foreign transaction fees		628,880			671,513		712,944
Merchant, debit/credit card fees		863,929			776,430		741,479
Other income		889,850			931,491		1,173,877
Total noninterest income		4,893,101			5,113,708		6,535,817
Noninterest expense:
Salaries and employee benefits		8,460,437			9,577,323		9,816,080
Occupancy and equipment expense		1,712,883			1,614,570		1,616,949
Data processing expenses		416,984			349,686		344,953
Merchant, debit/credit card expenses		658,172			581,515		523,139
Other expenses		3,238,706			3,364,314		3,295,199
Total noninterest expense		14,487,182			15,487,408		15,596,320
Income before income taxes		6,586,032			6,444,220		6,296,797
Income tax expense (Note 15)		1,499,397			1,407,290		1,541,983
Net income	$	5,086,635		$	5,036,930	$	4,754,814
Earnings per share, basic and diluted	$	3.98		$	3.71	$	3.51
Weighted average common shares outstanding		1,278,472			1,358,887		1,354,752

See Notes to Consolidated Financial Statements.

F - 3

C O N S O L I D A T E D   S T A T E M E N T S   O F  C H A N G E S   I N  S T O C K H O L D E R S’   E Q U I T Y

Years ended October 31, 2005, 2004, and 2003

				Additional
	Common			Paid-In			Retained
	Stock			Capital			Earnings
Balance, October 31, 2002	$	439,798		$	4,139,762		$	34,676,812
Cash dividends, $0.344 per share		—			—			(482,697	)
Purchase of 44,750 shares of treasury stock		—			—			—
Payment for unearned ESOP shares by ESOP		—			—			—
Tax benefit for dividends paid to ESOP		—			—			8,616
Release of ESOP shares, net of expiring puts and repurchases		(5,356	)		(50,347	)		(801,257	)
Appreciation in redeemable ESOP shares		—			—			(782,050	)
Comprehensive income:
Net income		—			—			4,754,814
Other comprehensive income, net of tax (Note 4)		—			—			—
Total comprehensive income
Balance, October 31, 2003		434,442			4,089,415			37,374,238
Cash dividends, $0.352 per share		—			—			(485,609	)
Purchase of 22,177 shares of treasury stock		—			—			—
Payment for unearned ESOP shares by ESOP		—			—			—
Tax benefit for dividends paid to ESOP		—			—			4,595
Release of ESOP shares, net of expiring puts and repurchases		(3,171	)		(29,809	)		(514,052	)
Appreciation in redeemable ESOP shares		—			—			(427,279	)
Comprehensive income:
Net income		—			—			5,036,930
Other comprehensive (loss), net of tax (Note 4)		—			—			—
Total comprehensive income
Balance, October 31, 2004		431,271			4,059,606			40,988,823
Cash dividends, $0.360 per share		—			—			(460,225	)
Purchase of 180,945 shares of treasury stock		—			—			—
Payment for unearned ESOP shares by ESOP		—			—			—
Repurchase of shares and expiring puts in excess of ESOP shares released		36,851			346,400			6,213,078
Appreciation in redeemable ESOP shares		—			—			(1,321,452	)
Comprehensive income (loss):
Net income		—			—			5,086,635
Other comprehensive (loss), net of tax (Note 4)		—			—			—
Total comprehensive (loss)
Balance, October 31, 2005	$	468,122		$	4,406,006		$	50,506,859

See Notes to Consolidated Financial Statements.

F - 4

Accumulated Other			Unearned
Comprehensive			ESOP			Treasury
Income (Loss)			Shares			Stock			Total
$	4,507,219	$	(1,289,407	)	$	(7,464,923	)	$	35,009,261
	—		—			—			(482,697	)
	—		—			(1,453,225	)		(1,453,225	)
	—		604,598			—			604,598
	—		—			—			8,616
	—		—			—			(856,960	)
	—		—			—			(782,050	)
	—		—			—			4,754,814
	219,740		—			—			219,740
									4,974,554
	4,726,959		(684,809	)		(8,918,148	)		37,022,097
	—		—			—			(485,609	)
	—		—			(793,105	)		(793,105	)
	—		631,032			—			631,032
	—		—			—			4,595
	—		—			—			(547,032	)
	—		—			—			(427,279	)
	—		—			—			5,036,930
	(1,264,691)		—			—			(1,264,691	)
									3,772,239
	3,462,268		(53,777	)		(9,711,253	)		39,176,938
	—		—			—			(460,225	)
	—		—			(6,912,099	)		(6,912,099	)
	—		53,777			—			53,777
	—		—			—			6,596,329
	—		—			—			(1,321,452	)
	—		—			—			5,086,635
	(5,171,117)		—			—			(5,171,117	)
									(84,482	)
$	(1,708,849)	$	0		$	(16,623,352	)	$	37,048,786

See Notes to Consolidated Financial Statements.

F-5

C O N S O L I D A T E D   S T A T E M E N T S   O F   C A S H   F L O W S
Years ended October 31, 2005, 2004, and 2003

	2005			2004			2003
Cash Flows from Operating Activities:
Net income	$	5,086,635		$	5,036,930		$	4,754,814
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		774,009			833,865			840,243
Provision for loan losses		(1,150,000	)		—			1,766,000
Deferred income tax expense (benefit)		613,831			271,195			(179,519	)
Amortization of premium and accretion of discount on securities, net		1,990,552			1,939,599			1,610,854
Amortization of intangible assets		199,243			199,243			199,243
Securities gains, net		(62,268	)		(19,931	)		(206,337	)
Gains on sales of real estate loans		(180,999	)		(250,292	)		(1,169,293	)
Gains on sales of student loans		(467,075	)		(503,093	)		(347,241	)
Real estate loans originated for sale		(17,711,380	)		(19,499,596	)		(95,102,639	)
Student loans originated for sale		(30,620,914	)		(27,527,177	)		(23,564,974	)
Proceeds from sales of real estate loans		17,628,430			21,135,925			96,132,766
Proceeds from sales of student loans		30,600,926			30,426,592			22,641,774
(Increase) decrease in accrued interest receivable and other assets		(2,072,769	)		(36,883	)		892,937
Increase in accrued interest payable and other liabilities		696,822			173,602			164,165
Net cash provided by operating activities		5,325,043			12,179,979			8,432,793
Cash Flows from Investing Activities:
Net (increase) decrease in federal funds sold		(3,400,000	)		(5,250,000	)		7,400,000
Proceeds from sales of securities available for sale		1,535,030			5,019,844			20,042,974
Proceeds from maturities and calls of securities available for sale		30,073,000			22,084,403			40,732,265
Proceeds from principal paydowns on securities available for sale		2,640,524			4,824,417			22,019,785
Purchase of securities available for sale		(53,296,244	)		(66,039,937	)		(119,652,833	)
Net decrease in loans		10,735,881			13,006,721			25,576,387
Purchases of premises and equipment, net		(1,150,908	)		(220,995	)		(907,927	)
Net cash (used in) investing activities		(12,862,717	)		(26,575,547	)		(4,789,349	)
Cash Flows from Financing Activities:
Net increase in deposits		11,396,260			13,069,093			844,133
Net increase (decrease) in short-term borrowings		13,921			2,596,880			(136,500	)
Repayment of term Federal Home Loan Bank advances		—			—			(3,000,000	)
Repayment of notes payable		(677,094	)		(731,770	)		(729,267	)
Cash dividends paid		(460,225	)		(485,609	)		(482,697	)
Purchase of treasury stock		(6,912,099	)		(793,105	)		(1,453,225	)
Net cash provided by (used in) financing activities		3,360,763			13,655,489			(4,957,556	)

See Notes to Consolidated Financial Statements.

F-6

C O N S O L I D A T E D   S T A T E M E N T S   O F   C A S H   F L O W S (c o n t i n u e d)
Years ended October 31, 2005, 2004, and 2003

	2005			2004			2003
(Decrease) in cash and due from banks	$	(4,176,911	)	$	(740,079	)	$	(1,314,112	)
Cash and due from banks:
Beginning of year		24,419,553			25,159,632			26,473,744
End of year	$	20,242,642		$	24,419,553		$	25,159,632
Supplemental Disclosures of Cash Flow Information, cash paid during the year for:
Interest	$	9,013,246		$	7,267,094		$	9,646,990
Income taxes		897,484			729,468			1,253,503
Supplemental Disclosures of Noncash Investing and Financing Activities:
Payment on ESOP note payable by ESOP		53,777			631,032			604,598
Tax benefit for dividends paid to ESOP		—			4,595			8,616
Change in accumulated other comprehensive income, unrealized gains (losses) on securities available for sale, net		(5,171,117	)		(1,264,691	)		219,740
Change in redeemable common stock held by ESOP participants		(5,274,877	)		974,311			1,639,010
Transfer of student loans from held for investment to held for sale portfolio		—			4,134,629			—

See Notes to Consolidated Financial Statements.

F-7

N O T E S   T O   C O N S O L I D A T E D   F I N A N C I A L   S T A T E M E N T S
Note 1. Nature of Business and Significant Accounting Policies

Nature of Business: The Company is engaged in the business of commercial and retail banking and trust and insurance services conducted through its subsidiaries, Metrobank, N.A., Community Insurance, Inc., and Metrocorp Capital Trust I. Metrobank’s main office and eighteen branch offices are located in western Illinois and eastern Iowa. Customers in these areas are the primary source of the Company’s deposit, loan, and trust activities. The majority of the Company’s income is derived from commercial and retail lending, deposit activities, and investments. Metrocorp Capital Trust I was capitalized in November 2001 for the purpose of issuing trust preferred securities.

SIGNIFICANT ACCOUNTING POLICIES:

Accounting estimates: The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The allowance for loan losses is inherently subjective as it requires material estimates that are susceptible to significant change. The fair value disclosure of financial instruments and the liability for redeemable common stock held by ESOP participants are estimates that can be computed within a range.

Principles of consolidation: The consolidated financial statements of Metrocorp, Inc. (the Company) include the accounts of the Company and its wholly-owned subsidiaries, except Metrocorp Capital Trust I, which under current accounting rules, no longer meets the criteria for consolidation. Significant intercompany balances and transactions have been eliminated in consolidation.

Industry Segment Information: The primary source of income for the Company is interest from the origination of consumer, commercial, agricultural, commercial real estate, and residential real estate loans along with interest on the investment securities portfolio. See Note 6 for a discussion of concentrations of credit risk. The Company accepts deposits from customers in the normal course of business primarily in western Illinois and eastern Iowa. The Company operates primarily in the banking industry which accounts for more than 99% of its revenues, operating income, and assets, with the remaining operations coming from the operation of Community Insurance. The Company uses the “management approach” for reporting information about segments in annual and interim financial statements. The management approach is based on the way the chief operating decision-maker organizes segments within a company for making operating decisions and assessing performance. Reportable segments are based on products and services, geography, legal structure, management structure and any other manner in which management disaggregates a company. Based on the “management approach” model, the Company has determined that its business is comprised of a single operating segment.

Presentation of cash flows: For purposes of reporting cash flows, cash and cash equivalents include cash on-hand and amounts due from banks. Cash flows from loans, deposits, and short-term borrowings are treated as net increases or decreases.

Securities available-for-sale: Securities available-for-sale are carried at fair value and consist of those securities which the Company may decide to sell if needed for liquidity, asset/liability management, or other reasons. Unrealized gains and losses are reported as increases or decreases in accumulated other comprehensive income.

F-8

N O T E S   T O   C O N S O L I D A T E D   F I N A N C I A L   S T A T E M E N T S
Note 1. Nature of Business and Significant Accounting Policies(Continued)

Gains and losses on disposition are based on the net proceeds and the amortized cost of the securities sold, using the specific identification method, and are included in earnings.

Declines in the fair value of held-to-maturity and available-for-sale securities below their cost that are deemed to be other-than-temporary are reflected in earnings as realized losses. In estimating other-than-temporary impairment losses, management considers (1) the length of time and the extent to which the fair value has been less than cost, (2) the financial condition and near-term prospects of the issuer, and (3) the intent and ability of the Company to retain its investment in the issuer for a period of time sufficient to allow for any anticipated recovery in fair value.

Loans held for sale: Residential real estate and student loans, which are originated and intended for resale in the secondary market in the foreseeable future, are classified as held for sale. These loans are carried at lower of cost or estimated market value in the aggregate. As assets specifically acquired for resale, the origination of, disposition of, and gain or loss on these loans are classified as operating activities in the statement of cash flows.

Loans: Loans that management has the intent and ability to hold for the foreseeable future, or until payoff or maturity occurs, are classified as held for investment. These loans are stated at the amount of unpaid principal adjusted for charge-offs, the allowance for estimated loan losses on loans, and any deferred fees and/or costs on originated loans. Interest is credited to earnings as earned based on the principal amount outstanding. Deferred direct loan origination fees and/or costs are amortized as an adjustment of the related loan’s yield. As assets held for and used in the production of services, the origination and collection of these loans is classified as an investing activity in the statement of cash flows.

Allowance for loan losses: The allowance for loan losses is maintained at the level considered adequate by management of the Company to provide for losses that are probable. The allowance is increased by provisions charged to expense and reduced by net charge-offs. In determining the adequacy of the allowance, the Company considers the overall composition of the loan portfolio, types of loans, past loss experience, loan delinquencies, potential substandard and doubtful credits, economic conditions, and other factors that in management’s judgment deserve evaluation.

Loans are considered impaired when, based on current information and events, it is probable the Company involved will not be able to collect all amounts due. The portion of the allowance for loan losses applicable to an impaired loan is computed based on the present value of the estimated future cash flows of interest and principal discounted at the loan’s effective interest rate or on the fair value of the collateral for collateral dependent loans. The entire change in present value of expected cash flows of impaired loans is reported as bad debt expense in the same manner in which impairment initially was recognized or as a reduction in the amount of bad debt expense that otherwise would be reported.

Credit related financial instruments: In the ordinary course of business, the Company has entered into commitments to extend credit, including unused lines of credit and standby letters of credit. Such financial instruments are recorded when they are funded.

F-9

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N O T E S   T O   C O N S O L I D A T E D   F I N A N C I A L   S T A T E M E N T S
Note 1. Nature of Business and Significant Accounting Policies (Continued)

Transfers of financial assets: Transfers of financial assets are accounted for as sales, only when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when (1) the assets have been isolated from the Company, (2) the transferee obtains the right to pledge or exchange the assets if received, and no condition both constrains the transferee from taking advantage of its right to pledge or exchange and provides more than a trivial benefit to the transferor, and (3) the Company does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity or the ability to unilaterally cause the holder to return specific assets.

Premises and equipment: Premises and equipment are stated at cost less accumulated depreciation. Depreciation is provided by the straight-line and declining balance methods over the estimated useful lives of the assets, which range from ten to forty years for buildings and improvements and from three to fifteen years for furniture and equipment.

Other revenue recognition: Revenue from trust services and other service charges and fees is recognized as the services are provided.

Goodwill: Goodwill is not amortized but is subject to an impairment test at least annually, or more often if conditions indicate a possible impairment.

Income taxes: The Company files its tax return on a consolidated basis with its subsidiaries. The entities follow the direct reimbursement method of accounting for income taxes under which income taxes or credits which result from the subsidiary’s inclusion in the consolidated tax return are paid to or received from the parent company.

Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

Trust assets: Trust assets held by the Bank in a fiduciary or agency capacity for its customers, other than trust cash on deposit at the Bank, are not included in the accompanying consolidated balance sheets since such items are not assets of the Bank.

Earnings per share: Basic per share amounts are computed by dividing net income (the numerator) by the weighted average number of common shares outstanding (the denominator). Diluted per share amounts assume the conversion, exercise or issuance of all potential common stock unless the effect is to reduce the loss or increase the income per common share. Allocated shares held by the employee stock ownership plan are considered to be outstanding shares.

F-10

N O T E S   T O   C O N S O L I D A T E D   F I N A N C I A L   S T A T E M E N T S
Note 1. Nature of Business and Significant Accounting Policies (Continued)

Current accounting development: In November 2003, the Emerging Issues Task Force (EITF) reached a consensus on certain disclosure requirements under EITF Issue No. 03-1, “The Meaning of Other-Than-Temporary Impairment and Its Application to Certain Investments”. The new disclosure requirements apply to investment in debt and marketable equity securities that are accounted for under Statement of Financial Accounting Standards (SFAS) No. 115, “Accounting for Certain Investments in Debt and Equity Securities.” Effective for fiscal years ending after December 15, 2003, companies were required to disclose information about debt or marketable equity securities with market values below carrying values. The Company previously implemented the disclosure requirements of EITF Issue No. 03-1. In March 2004, the EITF came to a consensus regarding EITF 03-1. Securities in scope are those subject to SFAS 115. The EITF adopted a three-step model that requires management to determine if impairment exists, decide whether it is other-than-temporary, and record other-than-temporary losses in earnings. In November 2005, the Financial Accounting Standards Board (FASB) issued FASB Staff Position (FSP) Nos. FAS 115-1 and FAS 124-1, “The Meaning of Other-Than-Temporary Impairment and its Application to Certain Investments,” which will apply to reporting periods beginning after December 15, 2005. The FSPs provide guidance on determining when investments in certain debt and equity securities are considered impaired, whether that impairment is other-than-temporary, and on measuring such impairment loss. The FSPs also include accounting considerations subsequent to the recognition of other-than-temporary impairment and requirements for certain disclosures about unrealized losses that have not been recognized as other-than-temporary impairments.

Stock Split: During the year ended October 31, 2004, the Company declared a 10:1 common stock split, effected in the form of a stock dividend. All share and per share data has been retroactively adjusted to reflect the split, as if it had occurred on November 1, 1995.

Reclassifications: Certain amounts in the prior year financial statements have been reclassified, with no effect on net income or stockholders’ equity, to conform with current year presentations.

Note 2. Restrictions on Cash and Due from Banks

The Bank is required by federal banking regulations to maintain certain reserve balances in cash and due from banks. The reserve requirement was approximately $16,712,000 and $16,223,000 as of October 31, 2005 and 2004, respectively.

F-11

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Note 3. Comprehensive Income

Comprehensive income is the total of net income and other comprehensive income, which for the Company is comprised entirely of unrealized gains and losses on securities available for sale.

Other comprehensive income (loss) is comprised as follows:

	Before			Tax Expense			Net
	Tax			(Benefit)			of Tax
Year ended October 31, 2005:
Unrealized gains (losses) on securities available for sale:
Unrealized holding (losses) arising during the year	$	(8,373,485	)	$	(3,240,538	)	$	(5,132,947	)
Less reclassification adjustment for gains included in net income		62,268			24,098			38,170
Other comprehensive (loss)	$	(8,435,753	)	$	(3,264,636	)	$	(5,171,117	)
Year ended October 31, 2004:
Unrealized gains (losses) on securities available for sale:
Unrealized holding (losses) arising during the year	$	(2,043,188	)	$	(790,715	)	$	(1,252,473	)
Less reclassification adjustment for gains included in net income		19,931			7,713			12,218
Other comprehensive (loss)	$	(2,063,119	)	$	(798,428	)	$	(1,264,691	)
Year ended October 31, 2003:
Unrealized gains on securities available for sale:
Unrealized holding gains arising during the year	$	564,804		$	218,579		$	346,225
Less reclassification adjustment for gains included in net income		206,337			79,852			126,485
Other comprehensive income	$	358,467		$	138,727		$	219,740

F-12

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Note 4. Securities Available for Sale

The amortized cost and fair values of securities available for sale as of October 31, 2005 and 2004 are as follows:

			Gross		Gross
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		(Losses)			Value
	2005
U.S. Treasury	$	35,171,549	$	44,572	$	(541,903	)	$	34,674,218
U.S. government agencies		67,611,208		237,648		(1,197,393	)		66,651,463
States and political subdivisions		142,524,711		771,210		(2,639,560	)		140,656,361
Corporate		46,537,992		1,058,437		(674,319	)		46,922,110
Trust preferred securities		927,331		138,839		—			1,066,170
Mortgage-backed		4,140,154		32,121		(17,334	)		4,154,941
	$	296,912,945	$	2,282,827	$	(5,070,509	)	$	294,125,263
	2004
U.S. Treasury	$	32,542,116	$	498,946	$	(12,582	)	$	33,028,480
U.S. government agencies		62,242,253		1,115,845		(246,946	)		63,111,152
States and political subdivisions		131,516,860		2,507,280		(721,422	)		133,302,718
Corporate		45,740,977		2,444,184		(168,209	)		48,016,952
Trust preferred securities		926,120		165,920		—			1,092,040
Mortgage-backed		6,825,213		80,280		(15,225	)		6,890,268
	$	279,793,539	$	6,812,455	$	(1,164,384	)	$	285,441,610

Gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, as of October 31, 2005, and 2004 are as follows:

	Less than 12 Months					12 Months or More					Total
			Gross					Gross					Gross
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
	Value		(Losses)			Value		(Losses)			Value		(Losses)
	2005
Securities available for sale:
U.S. Treasury	$	23,649,375	$	(465,611	)	$	4,988,906	$	(76,292	)	$	28,638,281	$	(541,903	)
U.S. Government agencies		29,713,384		(503,578	)		21,959,921		(693,791	)		51,673,305		(1,197,369	)
States and political subdivisions		47,048,078		(921,690	)		53,398,321		(1,717,870	)		100,446,399		(2,639,560	)
Corporate		10,540,653		(246,337	)		14,882,815		(427,982	)		25,423,468		(674,319	)
Mortgage-backed		2,220,098		(12,224	)		562,858		(5,134	)		2,782,956		(17,358	)
	$	113,171,588	$	(2,149,440	)	$	95,792,821	$	(2,921,069	)	$	208,964,409	$	(5,070,509	)

F-13

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NOTE 4. Securities Available For Sale (Continued)

	Less than 12 Months					12 Months or More					Total
			Gross					Gross					Gross
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
	Value		Losses)			Value		(Losses)			Value		(Losses)
	2004
Securities available for sale:
U.S. Treasury	$	5,178,600	$	(12,582	)	$	—	$	—		$	5,178,600	$	(12,582	)
U.S. Government agencies		12,299,303		(60,539	)		11,319,956		(186,407	)		23,619,259		(246,946	)
States and political subdivisions		26,102,513		(297,146	)		34,282,660		(424,276	)		60,385,173		(721,422	)
Corporate		5,632,560		(27,474	)		10,281,855		(140,735	)		15,914,415		(168,209	)
Mortgage-backed		1,402,034		(5,737	)		1,542,773		(9,488	)		2,944,807		(15,225	)
	$	50,615,010	$	(403,478	)	$	57,427,244	$	(760,906	)	$	108,042,254	$	(1,164,384	)

As of October 31, 2005, the investment portfolio included approximately 180 securities with current unrealized losses which have existed for longer than one year. All of these securities are considered to be acceptable credit risks. Because the declines in fair value were due to changes in market interest rates, not in estimated cash flows, no other-than-temporary impairment was recorded at October 31, 2005. In addition, the Company has the intent and ability to hold these investment securities for a period of time sufficient to allow for an anticipated recovery.

The amortized cost and fair value of securities available for sale as of October 31, 2005, by contractual maturity are shown below. Expected maturities of mortgage-backed securities may differ from contractual maturities because borrowers may have the right to call or repay obligations with or without call or prepayment penalties. Therefore, these securities are not included in the maturity categories in the following summary.

	Amortized		Fair
	Cost		Value
Due in one year or less	$	53,851,029	$	53,623,394
Due after one year through five years		201,120,779		198,921,030
Due after five years through ten years		30,743,205		30,365,743
Due after ten years		7,057,778		7,060,155
		292,772,791		289,970,322
Mortgage-backed		4,140,154		4,154,941
	$	296,912,945	$	294,125,263

As of October 31, 2005 and 2004, securities with a carrying value of $115,981,671 and $110,715,651, respectively, were pledged to secure public and trust deposits, short-term borrowings and for other purposes as required or permitted by law.

Security sales proceeds and gross realized gains and losses were as follows:

	2005		2004		2003
Proceeds from sales of securities available for sale	$	1,535,030	$	5,019,844	$	20,042,974
Gross realized gains		62,268		19,931		208,648
Gross realized (losses)		—		—		(2,311	)

F-14

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Note 5. Loans Held For Sale

Included in loans held for sale are real estate — residential loans of $785,199 and $521,249, respectively, and student loans of $13,374,977 and $12,887,915, respectively, as of October 31, 2005 and 2004, respectively.

Note 6. Loans

The Company makes loans to customers primarily in western Illinois and eastern Iowa. Most loans are secured by specific items of collateral, including commercial and residential real estate, farmland, and other business and consumer assets.

Loans as of October 31, 2005 and 2004 consisted of the following:

	2005		2004
Commercial	$	23,084,454	$	26,599,719
Agricultural production		32,077,481		30,805,048
Real estate:
Construction		1,244,334		1,476,757
Residential		41,996,174		40,933,961
Commercial		38,136,664		39,679,155
Farmland		41,052,340		38,518,681
Installment		16,206,796		20,189,753
Student		11,818,866		18,386,205
Other		3,602,892		3,168,508
Total loans		209,220,001		219,757,787
Less allowance for loan losses		2,519,213		3,471,118
Loans, net	$	206,700,788	$	216,286,669

Activity in the allowance for loan losses is summarized below:

	2005			2004			2003
Balance, beginning	$	3,471,118		$	3,544,619		$	4,032,546
Provision for loan losses		(1,150,000	)		—			1,766,000
Recoveries on loans previously charged off		366,495			456,539			62,972
Loans charged off		(168,400	)		(530,040	)		(2,316,899	)
Balance, ending	$	2,519,213		$	3,471,118		$	3,544,619

Impaired loans, comprised of nonaccrual loans, loans past due 90 days or more and still accruing interest, and specific allowance loans as of October 31, 2005 and 2004 are as follows:

	2005		2004
Year-end impaired loans with no allowance for loan losses allocated	$	—	$	—
Year-end impaired loans with allowance for loan losses allocated		2,446,838		1,985,419
Amount of allowance allocated to impaired loans		864,686		49,935
Average of impaired loans during the year		2,385,308		1,966,484

Interest income and cash interest collected on impaired loans was not material during the years ended October 31, 2005, 2004, and 2003.

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Note 6. Loans (Continued)

Loans serviced for others are not included in the accompanying consolidated balance sheets. The unpaid balance of loans serviced for the Federal Home Loan Mortgage Corporation, Federal National Mortgage Association, Federal Home Loan Bank, and the Illinois Housing Development Authority as of October 31, 2005 and 2004 were approximately $129,262,000 and $134,402,000, respectively.

Custodial escrow balances maintained in connection with the foregoing loan servicing were approximately $569,000 and $201,000 as of October 31, 2005 and 2004, respectively.

Note 7. Premises And Equipment

Premises and equipment consisted of the following as of October 31, 2005 and 2004:

	2005		2004
Land	$	2,312,349	$	2,272,349
Buildings and improvements		9,073,559		8,549,398
Furniture and equipment		9,115,706		8,543,947
Total cost		20,501,614		19,365,694
Less accumulated depreciation		11,455,839		10,696,818
	$	9,045,775	$	8,668,876

Note 8. Intangible Assets

Intangible assets consisted of the following as of October 31, 2005 and 2004:

	2005		2004
Goodwill, net of accumulated amortization of $760,521	$	9,829,605	$	9,829,605
Other intangible assets		2,061,521		2,061,521
Less accumulated amortization on intangible assets		1,127,925		928,682
Other intangible assets, net	$	933,596	$	1,132,839

Estimated amortization expense for each of the five succeeding years and in aggregate is expected to be as follows:

Year ending October 31:
2006	$	199,243
2007		107,466
2008		107,466
2009		107,466
2010		107,466
Thereafter		304,489
	$	933,596

F-16

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Note 8. Intangible Assets (Continued)

On August 14, 1998, the Bank acquired a branch office in Davenport, Iowa from another financial institution. The intangible asset acquired in the transaction was $1,612,000 and is being amortized on a straight-line basis over fifteen years. This branch acquisition was recorded using the purchase method of accounting.

On November 1, 2001, the Company acquired all of the outstanding common stock of Farmers State Bank (Farmers), Mount Carroll, Illinois; Community Bank (Community), Preston, Iowa; and Community Insurance, Inc., Miles, Iowa. Immediately following the acquisition, Farmers and Community were merged with Metrobank. The core deposit intangible related to this acquisition of $449,521 is being amortized over a period of five years. Goodwill related to this and a prior acquisition totaled $9,829,605. In accordance with the provisions of FASB Statement No. 142, goodwill related to the acquisition is not being amortized, but is evaluated annually for impairment.

Note 9. Deposits

As of October 31, 2005, scheduled maturities of time deposits are as follows:

Year ending October 31:
2006	$	158,721,485
2007		27,023,956
2008		13,059,205
2009		1,353,098
2010		549,170
Thereafter		46,117
	$	200,753,031

Note 10. Short-Term Borrowings

Short-term borrowings consist of the following as of October 31, 2005 and 2004:

	2005		2004
Securities sold under agreements to repurchase	$	3,800,000	$	3,925,000
Demand notes issued to U.S. Treasury		947,578		808,657
	$	4,747,578	$	4,733,657

Other information concerning securities sold under agreements to repurchase is summarized as follows:

	2005			2004
Average balance during the year	$	3,895,315		$	2,307,451
Average interest rate during the year		1.79	%		1.36	%
Maximum month-end balance during the year		5,535,000			4,380,000
Weighted average rate as of end of period		1.75	%		1.75	%
Securities underlying the agreements at year-end:
Carrying value	$	10,595,240		$	10,627,135
Fair value		10,595,240			10,627,135

F-17

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Note 10. Short-Term Borrowings (Continued)

Average balance and rates above are based upon average daily balances and rates. The securities underlying the agreements at year-end were under the Company’s control.

Demand notes issued to the U.S. Treasury bear interest at a variable rate and are generally called within several days.

Note 11. Federal Home Loan Bank Advances

The Bank is a member of the Federal Home Loan Bank (FHLB). As of October 31, 2005 and 2004, the Bank held $4,021,700 and $1,863,500 of FHLB stock, respectively, which is included in other assets on the consolidated balance sheets.

As of October 31, 2005 and 2004, the Bank had FHLB advances outstanding totaling $1,000,000 bearing interest at a fixed rate of 5.95% and maturing in 2010.

Real estate loans with a balance of approximately $1,200,000 as of October 31, 2005 and 2004, are pledged against these advances.

The Bank also maintains a line of credit with the FHLB. No amounts were outstanding on the line of credit as of October 31, 2005 and 2004. The maximum amount available under the FHLB line of credit is a percentage of Metrobank’s regulatory capital. The line amount as of October 31, 2005 and 2004 approximates $28,374,000 and $22,982,000, respectively. The line of credit bears interest at a floating rate and as of October 31, 2005 and 2004 was 4.30% and 2.09%, respectively.

Note 12. Employee Benefit Plans

The Company maintained a noncontributory employee stock ownership plan (ESOP) covering substantially all employees of the Bank. At the regular board meeting, held on November 15, 2004, the directors passed a resolution terminating the ESOP. The effect of this termination was that the shares of stock were distributed to the employees in May of 2005. The Company’s ESOP contributions and compensation expense for 2005, 2004, and 2003 were $53,990, $635,965, and $626,922, respectively.

Dividends declared on ESOP shares are charged against retained earnings regardless of whether they are allocated to participants or held as unallocated shares.

Shares held by the ESOP as of October 31, 2004 were as follows:

	2004
Allocated shares		291,020
Shares released for allocation		29,176
Unreleased shares		2,434
Total ESOP shares		322,630
Approximate fair value of unreleased shares as of October 31	$	87,000

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Note 12. Employee Benefit Plans (Continued)

A participant or beneficiary who received a distribution of employer stock from the ESOP had the right to require the Company to purchase such shares at their fair market value any time within 60 days of the distribution date. If this right was not exercised, an additional 60-day exercise period is available in the year following the year in which the distribution was made and begins after a new valuation of the stock has been determined and communicated to the participant or beneficiary. As of October 31, 2005 and 2004, 144,421 and 328,676 shares, respectively, at a fair value of $44.95 and $35.80, respectively, have been classified as mezzanine capital.

The Company maintains a 401(k) salary reduction plan covering all full-time employees of the Bank who have completed one year of employment with 1,000 hours of service and are age 21 or older. Employees may contribute a portion of their eligible salaries not to exceed Internal Revenue Service limits. No contributions to the plan were made by the employer during the years ended October 31, 2005, 2004, and 2003.

Note 13. Notes Payable

In connection with the acquisition discussed in Note 8, the Company has a note payable to LaSalle National Bank of $5,433,970. The note bears interest at a variable rate based on LIBOR, with interest due monthly. The rate was 6.03% as of October 31, 2005. Principal payments are due annually. The note is collateralized by common stock of Metrobank.

Principal payments on the LaSalle note payable are due as follows:

2006	$	672,000
2007		672,000
2008		672,000
2009		672,000
2010		672,000
Thereafter		2,073,970
	$	5,433,970

Note 14. Junior Subordinated Debentures And Trust Preferred Securities

Junior Subordinated Debentures:

Junior subordinated debentures are due to Metrocorp Capital Trust I, a 100% owned non-consolidated subsidiary of the Company. The debentures were issued in 2001 in conjunction with the Trust’s issuance of 10,000 shares of Company Obligated Mandatorily Redeemable Preferred Securities. The debentures bear the same interest rate and terms as the preferred securities, detailed following. The debentures are included on the balance sheet as liabilities; however for regulatory purposes $10,000,000, representing the entire amount of the trust’s capital securities, is allowed in the calculation of Tier I capital.

F-19

N O T E S   T O   C O N S O L I D A T E D   F I N A N C I A L   S T A T E M E N T S
Note 14. Junior Subordinated Debentures and Trust Preferred Securities (Continued)

Trust Preferred Securities:

The Company issued all of the 10,000 authorized shares of Company Mandatorily Redeemable Preferred Securities of Metrocorp Capital Trust Holding Solely Subordinated Debentures (trust preferred securities). Distributions are paid quarterly. Cumulative cash distributions are calculated at a variable rate equal to the prime rate plus .75% (6.75% as of October 31, 2005). The Company may, at one or more times, defer interest payments on the capital securities for up to 20 consecutive quarters, but not beyond October 31, 2031. At the end of any deferral period, all accumulated and unpaid distributions will be paid. The capital securities will be redeemed on October 31, 2031; however, the Company has the option to shorten the maturity date to a date not earlier than October 31, 2006. The redemption price is $1,000 per capital security plus any accrued and unpaid distributions to the date of redemption. Holders of the capital securities have no voting rights, are unsecured and rank junior in priority of payment to all of the Company’s indebtedness and senior to the Company’s capital stock.

Note 15. Income Taxes

Income tax expense consists of the following for the years ended October 31, 2005, 2004, and 2003.

	2005		2004		2003
Currently payable	$	885,566	$	1,136,095	$	1,721,502
Deferred (benefit)		613,831		271,195		(179,519	)
Income tax expense	$	1,499,397	$	1,407,290	$	1,541,983

Income tax expense differs from the amount computed by applying the federal income tax rate to income before income taxes. The reasons for this difference are as follows:

	Year Ended October 31,
	2005						2004						2003
	Dollar			% of Pretax			Dollar			% of Pretax			Dollar			% of Pretax
	Amount			Income			Amount			Income			Amount			Income
Computed “expected” income tax expense	$	2,305,111			35.0	%	$	2,255,477			35.0	%	$	2,203,879			35.0	%
Effect of graduated tax rate		(65,860	)		(1.0	)		(64,442	)		(1.0	)		(62,968	)		(1.0	)
Tax exempt interest and dividend income, net		(877,366	)		(13.3	)		(861,712	)		(13.4	)		(699,334	)		(11.1	)
State income taxes, net		123,228			1.9			77,119			1.2			95,921			1.5
Other, net		14,284			0.2			848			—			4,485			0.1
	$	1,499,397			22.8	%	$	1,407,290			21.8	%	$	1,541,983			24.5	%

As of October 31, 2005, the Company has alternative minimum tax (AMT) credit carryforwards of $930,414. These credits have no expiration date and can be used to reduce regular corporate income taxes to the extent such tax exceeds AMT in future years.

F-20

N O T E S   T O   C O N S O L I D A T E D   F I N A N C I A L   S T A T E M E N T S
Note 15. Income Taxes (Continued)

The net deferred tax asset (liability) included with other assets (liabilities) on the balance sheets consisted of the following as of October 31, 2005 and 2004:

	2005		2004
Deferred tax assets:
Net unrealized loss on securities available-for-sale	$	1,078,833	$	—
Allowance for loan losses		975,943		1,256,740
Alternative minimum tax credit carryforwards		930,414		874,567
Other		112,833		209,175
		3,098,023		2,340,482
Deferred tax liabilities:
Net unrealized gain on securities available-for-sale		—		2,185,803
Investment securities accretion		176,168		155,007
Depreciation		263,811		307,728
Goodwill		927,162		669,226
Prepaid expenses		116,932		120,440
Stock dividends		232,169		170,882
Other		1,253		1,673
		1,717,495		3,610,759
Net deferred tax asset (liability)	$	1,380,528	$	(1,270,277	)

The net change in deferred income taxes is reflected in the financial statements for the years ended October 31, 2005, 2004, and 2003 as follows:

	2005			2004			2003
Provision for income taxes	$	613,831		$	271,195		$	(179,519	)
Statement of changes in stockholders equity — accumulated other comprehensive income, unrealized gains (losses) on securities available for sale, net		(3,264,636	)		(798,428	)		138,727
	$	(2,650,805	)	$	(527,233	)	$	(40,792	)

Note 16. Commitments And Contingencies

The Company is a party to financial instruments with off-balance-sheet risk in the normal course of business to meet financing needs of its customers. These financial instruments include commitments to make loans and standby letters of credit. The Company’s exposure to credit loss in the event of nonperformance by other parties to these financial instruments is represented by the contractual amount of the instruments. The Company uses the same credit policy to make such commitments as it uses for on-balance-sheet items.

The approximate contract amounts of these financial instruments are summarized as follows as of October 31:

	2005		2004
Loan commitments	$	1,269,000	$	891,000
Unused lines of credit		42,028,000		39,808,000
Standby letters of credit		497,000		466,000

F-21

N O T E S   T O   C O N S O L I D A T E D   F I N A N C I A L   S T A T E M E N T S
Note 16. Commitments and Contingencies (Continued)

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Bank evaluates each customers credit worthiness on a case-by-case basis. Collateral varies but may include accounts receivable, inventory, property and equipment, and income producing commercial properties.

Standby letters of credit are conditional commitments issued by the Bank to guarantee the performance of a customer to a third party. Those guarantees are primarily used to support private borrowing arrangements and extend for no more than one year. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. Collateral held varies as specified above and is required in instances which the Bank deems necessary.

The Company has executed contracts for the sale of mortgage loans in the secondary market in the amount of $1,065,000 and $836,000 as of October 31, 2005 and 2004, respectively. These amounts include loans held for sale of $785,000 and $521,000 and loan commitments, included in the summary above, of $280,000 and $315,000 as of October 31, 2005 and 2004, respectively.

The Company has also executed contracts for the sale of student loans in the secondary market in the amount of $13,375,000 and $12,888,000 as of October 31, 2005 and 2004, respectively. These amounts represent all student loans held for sale.

Concentrations of credit risk:

All of the Banks loans, commitments to extend credit, and standby letters of credit have been granted to customers in the Banks market area. The concentrations of credit by type of loan are set for th in Note 6. The distribution of commitments to extend credit approximates the distribution of loans outstanding, and standby letters of credit were granted primarily to commercial borrowers. Investment securities issued by state and political subdivisions (see Note 4) also involve governmental entities within the Banks market area.

Aside from cash on-hand, in-vault, and balances at the Federal Reserve Bank of Chicago, the majority of the Banks cash is maintained at LaSalle National Bank and the Federal Home Loan Bank. The total amount of cash on deposit exceeded combined federal insured limits as of October 31, 2005 by $8,651,000. In the opinion of management, no material risk of loss exists due to the financial condition of LaSalle National Bank and the Federal Home Loan Bank.

Contingencies:

In the normal course of business, the Company is involved in various legal proceedings. In the opinion of management, any liability resulting from such proceedings would not have a material effect on the Company’s financial statements.

F - 22

N O T E S   T O   CONSOLIDATED   F I N A N C I A L   S T A T E M E N T S
Note 17. Capital Requirements

The ability of the Company to pay dividends to its stockholders and to service the debt described in Notes 13 and 14, is dependent upon dividends paid to the Company by the Bank. The Bank is subject to certain statutory and regulatory restrictions on the amount it may pay in dividends. To maintain acceptable capital ratios in the Bank, certain of its retained earnings are not available for the payment of dividends. In addition certain covenants of the notes payable also limit the amount of dividends that the Bank can pay to the Company. The dividends that the Bank could declare within the limits of regulatory requirements, which are more restrictive than the debt covenants, approximated $2,200,000 as of October 31, 2005.

The Company and the Bank are subject to regulatory capital requirements administered by federal banking agencies. Capital adequacy guidelines and prompt corrective action regulations involve quantitative measures of assets, liabilities, and certain off-balance-sheet items calculated under regulatory accounting practices. Capital amounts and classifications are also subject to qualitative judgments by regulators about components, risk weightings, and other factors, and the regulators can lower classifications in certain cases. Failure to meet various capital requirements can initiate regulatory action that could have a direct material effect on the financial statements.

The Company and the Bank were considered well capitalized under the regulatory criteria at October 31, 2005 and 2004. There are no conditions or events since the most recent notification from the regulatory agency that management believes would have changed the Company or Bank’s categories.

As of October 31, 2005 and 2004, actual capital levels and minimum required amounts for the consolidated Company and Bank were as follows:

						Minimum
						for Capital					Minimum to be
	Amount					Adequacy Purposes					Well Capitalized
	Amount		Ratio			Amount		Ratio			Amount		Ratio
						(Dollars in Thousands)
October 31, 2005:
Total capital (to risk weighted assets):
Company	$	47,005		15.7	%	$	23,891		8	%		N/A		N/A
Bank	$	48,116		16.1	%	$	23,885		8	%	$	29,864		10	%
Tier 1 capital (to risk weighted assets)
Company	$	44,486		14.9	%	$	11,946		4	%		N/A		N/A
Bank	$	45,597		15.3	%	$	11,943		4	%	$	17,918		6	%
Tier 1 capital (to average assets)
Company	$	44,486		8.2	%	$	22,149		4	%		N/A		N/A
Bank	$	45,597		8.4	%	$	22,146		4	%	$	27,149		5	%
October 31, 2004:
Total capital (to risk weighted assets):
Company	$	49,990		16.8	%	$	23,748		8	%		N/A		N/A
Bank	$	52,689		17.8	%	$	23,741		8	%	$	29,676		10	%
Tier 1 capital (to risk weighted assets)
Company	$	46,519		15.7	%	$	11,874		4	%		N/A		N/A
Bank	$	49,218		16.6	%	$	11,870		4	%	$	17,806		6	%
Tier 1 capital (to average assets)
Company	$	46,519		8.4	%	$	22,501		4	%		N/A		N/A
Bank	$	49,218		8.9	%	$	22,498		4	%	$	28,122		5	%

F-23

N O T E S   T O   C O N S O L I D A T E D   F I N A N C I A L   S T A T E M E N T S

Note 18. Related Party Matters

Various officers, directors, and their affiliated companies were indebted to the Bank in the amounts of approximately $826,980 and $869,643 as of October 31, 2005 and 2004, respectively. Such loans are on the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with others. As of October 31, 2005, none of these loans are classified as nonaccrual, past due, or restructured.

The activity in such loans during the years ended October 31, 2005 and 2004 is as follows:

	2005			2004
Balance, beginning	$	869,643		$	1,157,846
Additions		1,260,835			1,095,406
Repayments		(1,303,498	)		(1,383,609	)
Balance, ending	$	826,980		$	869,643

Note 19. Disclosures about Fair Value of Financial Instruments

FASB Statement No. 107, Disclosures about Fair Value of Financial Instruments, requires disclosures of fair value information about financial instruments for which it is practical to estimate that value. When quoted market prices are not available, fair values are based on estimates using present value or other techniques. Those techniques are significantly affected by the assumptions used, including the discounted rates and estimates of future cash flows. In this regard, fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, could not be realized in an immediate settlement. Some financial instruments and all nonfinancial instruments are excluded from the disclosures. The aggregate fair value amounts presented do not represent the underlying value of the Company.

The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practical to estimate that value:

Cash and due from banks and federal funds sold: For those short-term instruments, the carrying amount is equal to fair value.

Securities available-for-sale: For securities, fair values are based on quoted market prices or dealer quotes, if available. If a quoted price is not available, fair value is estimated using quoted market prices for similar instruments.

Loans: The fair value of variable rate loans is equal to carrying value. The fair value of all other types of loans is estimated by discounting future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and remaining maturities. The fair value of loans held for sale is based on quoted market prices of comparable instruments.

Federal Home Loan Bank stock: The fair value of Federal Home Loan Bank stock is equal to carrying value.

F - 24

N O T E S   T O   C O N S O L I D A T E D   F I N A N C I A L   S T A T E M E N T S

Note 19. Disclosures about Fair Value of Financial Instruments (Continued)

Deposits: The fair value of fixed-maturity time deposits is estimated using a discounted cash flow analysis based on the rates currently offered for deposits of similar remaining maturities. The fair value of demand deposits, interest-bearing demand and money market deposits, and savings accounts is the amount payable on demand on the reporting date.

Short-term borrowings: For these short-term instruments, the carrying amount is equal to fair value.

Federal Home Loan Bank advances and junior subordinated debentures: For variable rate advances and junior subordinated debentures the carrying amount is equal to fair value. For fixed rate advances, the fair value is estimated using a discounted cash flow analysis based on the rates currently offered for similar borrowings.

Notes payable: For these variable rate notes, the carrying amount is equal to fair value.

Accrued interest receivable and payable: The carrying amounts of accrued interest is equal to fair value.

Commitments to extend credit and standby letters of credit: The fair value of these commitments is not material.

The carrying values and estimated fair values of the Company’s financial instruments as of October 31, 2005 and 2004 are as follows:

	2005				2004
	Carrying				Carrying
	Value		Fair Value		Value		Fair Value
			(in thousands)
Financial assets:
Cash and due from banks	$	20,243	$	20,243	$	24,420	$	24,420
Federal fund sold		8,650		8,650		5,250		5,250
Securities available for sale		294,125		294,125		285,442		285,442
Loans held for sale		14,160		14,376		13,409		13,617
Loans, net		206,701		205,095		216,287		216,420
Federal Home Loan Bank stock		4,022		4,022		1,864		1,864
Accrued interest receivable		7,386		7,386		7,233		7,233
Financial liabilities:
Demand deposits, noninterest-bearing		48,258		48,258		47,426		47,426
Interest-bearing demand and money market accounts		221,133		221,133		209,790		209,790
Savings deposits		41,267		41,267		41,338		41,338
Time deposits		200,753		201,738		201,462		202,170
Short-term borrowings		4,748		4,748		4,734		4,734
Federal Home Loan Bank advances		1,000		1,032		1,000		1,045
Notes payable		5,434		5,434		6,165		6,165
Junior subordinated debentures		10,309		10,309		10,309		10,309
Accrued interest payable		1,693		1,693		1,032		1,032

F - 25

N O T E S   T O   C O N S O L I D A T E D   F I N A N C I A L   S T A T E M E N T S

Note 20. Parent Company Statements

Presented below are the condensed balance sheets and condensed statements of income and cash flows for Metrocorp, Inc.:

Condensed Balance Sheets October 31, 2005 and 2004
	2005		2004
Assets
Cash on deposit at Metrobank	$	3,354,919	$	2,531,781
Investment in subsidiaries		54,960,594		63,952,218
Other assets		1,032,679		1,108,067
Total assets	$	59,348,192	$	67,592,066
Liabilities and Stockholders’ Equity
Notes payable	$	15,743,248	$	16,474,119
Other liabilities		64,434		174,408
Redeemable common stock held by Employee Stock Ownership Plan Participants		6,491,724		11,766,601
Stockholders’ equity		37,048,786		39,176,938
Total liabilities and stockholders’ equity	$	59,348,192	$	67,592,066

Condensed Statements of Income
Years Ended October 31, 2005, 2004, and 2003

	2005		2004		2003
Operating income:
Equity in net income of subsidiaries	$	5,948,583	$	5,951,113	$	5,681,755
Operating expense:
ESOP contribution expense		53,990		635,965		626,922
Interest expense		960,695		721,306		758,146
Other expenses		305,807		136,933		108,734
		1,320,492		1,494,204		1,493,802
Income before income tax benefit		4,628,091		4,456,909		4,187,953
Income tax benefit		458,544		580,021		566,861
Net income	$	5,086,635	$	5,036,930	$	4,754,814

F - 26

N O T E S   T O   C O N S O L I D A T E D   F I N A N C I A L   S T A T E M E N T S
Note 20. Parent Company Statements (Continued)

Condensed Statements of cash flows
Years ended October 31, 2005, 2004, and 2003

	2005			2004			2003
Cash Flows from Operating Activities:
Net income	$	5,086,635		$	5,036,930		$	4,754,814
Adjustments to reconcile net income to net cash provided by operating activities:
Distributions in excess of (less than) net income of subsidiaries		3,820,507			(1,989,258	)		(1,463,494	)
Change in other assets and other liabilities		(34,586	)		(207,793	)		199,500
Net cash provided by operating activities		8,872,556			2,839,879			3,490,820
Cash Flows from Financing Activities:
Repayment of notes payable		(677,094	)		(731,770	)		(729,267	)
Cash dividends paid		(460,225	)		(485,609	)		(482,697	)
Purchase of treasury stock		(6,912,099	)		(793,105	)		(1,453,225	)
Net cash (used in) financing activities		(8,049,418	)		(2,010,484	)		(2,665,189	)
Net increase in cash		823,138			829,395			825,631
Cash:
Beginning		2,531,781			1,702,386			876,755
Ending	$	3,354,919		$	2,531,781		$	1,702,386

F-27

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 21. Recent Developments

In August of 2005, National Bancshares, Inc. of Bettendorf, Iowa, made a hostile tender offer to our shareholders. Although the offer was evaluated and determined to be inadequate, subsequent indications of interest by other local competitors compelled the directors to begin a process to evaluate available strategic alternatives for maximizing shareholder value. As a result of this evaluation, Metrocorp engaged Hovde Financial, LLC, as its financial advisor in October 2005. Hovde has been working with Metrocorp to contact potential buyers and to obtain external valuations of Metrocorp. Certain prospective buyers have submitted non-binding indications of interest and are in the process of conducting due diligence procedures. Any sale is subject to entering into a definitive agreement and shareholder and regulatory approvals.

In connection with a possible sale, the Company has adopted change in control severance and stay bonus plans. The plans provide for payments only upon a change in control, as defined in the agreements.

F-28

McGladrey & Pullen
Certified Public Accountants

R E P O R T   O F   I N D E P E N D E N T   R E G I S T E R E D
PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders
Metrocorp, Inc.
East Moline, Illinois

Our audit was made for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplementary information is presented for additional analysis and is not a required part of the basic financial statements. The supplementary information as of and for the years ended October 31, 2005 to October 31, 2000, and October 31, 1997 and 1996 has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic consolidated financial statements taken as a whole. The supplementary information for 1999 and 1998 was audited by other auditors whose reports expressed an unqualified opinion on such information in relation to the basic financial statements taken as a whole.

/s/ McGladrey & Pullen, LLP

Davenport, Iowa

November 18, 2005

McGladrey & Pullen, LLP is a member firm of RSM International —
an affiliation of separate and independent legal entities.

F-29

METROBANK
C O N D E N S E D   B A L A N C E   S H E E T
October 31, 2005 and 2004

Assets	2005			2004
Cash and due from banks	$	20,242,642		$	24,419,553
Federal funds sold		8,650,000			5,250,000
Securities available for sale		294,125,263			285,441,610
Loans held for sale		14,160,176			13,409,164
Loans		209,220,001			219,757,787
Allowance for loan losses		(2,519,213	)		(3,471,118	)
Loans, net		206,700,788			216,286,669
Accrued interest receivable		7,383,924			7,231,282
Premises and equipment, net		9,043,759			8,667,298
Intangible assets, net		10,702,056			10,901,299
Other assets		5,665,606			3,712,063
Total assets	$	576,674,214		$	575,318,938
Liabilities and Stockholder’s Equity
Liabilities:
Deposits:
Demand deposits, noninterest-bearing	$	51,617,885		$	49,966,362
Interest-bearing demand and money market accounts		221,164,629			209,820,940
Savings		41,267,265			41,337,897
Time, $100,000 and over		69,312,844			80,102,480
Time, other		131,440,187			121,359,364
Total deposits		514,802,810			502,587,043
Short-term borrowings		4,747,578			4,733,657
Federal Home Loan Bank advances		1,000,000			1,000,000
Accrued interest payable and other liabilities		1,472,510			3,355,298
Total liabilities		522,022,898			511,675,998
Stockholder’s Equity:
Common stock		2,691,000			2,691,000
Additional paid-in capital		31,734,000			31,734,000
Retained earnings		21,935,165			25,755,672
Accumulated other comprehensive income (loss)		(1,708,849	)		3,462,268
Total stockholder’s equity		54,651,316			63,642,940
Total liabilities and stockholder’s equity	$	576,674,214		$	575,318,938

F-30

METROBANK
C O N D E N S E D   S T A T E M E N T S   O F   I N C O M E
Years Ended October 31, 2005, 2004, and 2003

	2005			2004		2003
Interest income:
Loans	$	13,311,049		$	12,857,018	$	15,766,382
Securities:
Taxable		8,372,062			8,411,899		8,159,476
Exempt from federal income tax		2,711,725			2,569,788		2,077,857
Federal funds sold		52,664			9,442		69,392
Other		235,958			158,563		156,312
Total interest income		24,683,458			24,006,710		26,229,419
Interest expense:
Interest-bearing demand and money market accounts		2,972,954			2,453,426		2,547,934
Savings deposits		212,688			199,964		212,230
Time deposits		5,097,237			3,562,693		5,465,681
Short-term borrowings		292,357			157,877		49,877
Federal Home Loan Bank advances		137,831			108,842		87,959
Total interest expense		8,713,067			6,482,802		8,363,681
Net interest income		15,970,391			17,523,908		17,865,738
Provision for loan losses		(1,150,000	)		—		1,766,000
Net interest income after provision for loan losses		17,120,391			17,523,908		16,099,738
Noninterest income:
Service charges on deposit accounts		1,324,598			1,410,077		1,667,064
Gains on sales of loans		648,074			753,385		1,516,534
Securities gains, net		62,268			19,931		206,337
Trust fees		475,502			550,881		517,342
ATM foreign transaction fees		628,880			671,513		712,944
Merchant, debit/credit card fees		863,929			776,430		741,479
Other income		795,284			815,935		1,066,014
Total noninterest income		4,798,535			4,998,152		6,427,714
Noninterest expense:
Salaries and employee benefits		8,336,372			8,856,720		9,125,212
Occupancy and equipment expense		1,712,115			1,610,238		1,611,583
Data processing expenses		416,984			349,686		344,953
Merchant, debit/credit card expenses		658,172			581,515		523,139
Other expenses		2,923,035			3,214,470		3,155,532
Total noninterest expense		14,046,678			14,612,629		14,760,419
Income before income taxes		7,872,248			7,909,431		7,767,033
Income tax expense		1,943,768			1,973,459		2,100,617
Net income	$	5,928,480		$	5,935,972	$	5,666,416

F-31

Exhibit Index

Exhibit
Number	Description
3.1	Articles of Incorporation of Metrocorp, as amended to date
3.2	Bylaws of Metrocorp
4.1	Amended and Restated Trust Agreement among Metrocorp, Inc., Wilmington Trust Company and the Administrators named therein dated November 1, 2001
4.2	Subordinated Loan Agreement between Metrocorp, Inc. and Metrocorp Capital Trust I dated November 1, 2001
4.3	Guarantee Agreement by Metrocorp, Inc. dated November 1, 2001
4.4	Form of Trust Preferred Certificate of Metrocorp Capital Trust I
4.5	Certificate of Trust of Metrocorp Capital Trust I (Exhibit A to Exhibit 4.1 hereto)
10.1	Form of Indemnification Agreement between Metrocorp and each director of Metrocorp
10.2	Form of Incentive Bonus Agreement between Metrocorp and each of Gary Andersen, Nancy Hamilton, Julius Van Paemel, Bart Ottens and other employees
10.3	Change of Control Severance Plan dated September 22, 2005
10.4	Stay Bonus Plan dated November 11, 2005
10.5	Renewal of Lease Agreement between Wal-Mart Stores, Inc. and Metrobank, NA dated July 11, 2000
10.6	Replacement Revolving Note payable by Metrocorp to La Salle Bank, N.A. dated August 5, 2002, due July 24, 2008
10.7	Loan Agreement between Metrobank and La Salle Bank, NA dated November 1, 2001, as amended by the First Amendment to Loan Agreement dated November 30, 2001, and the Second Amendment to Loan Agreement dated August 5, 2002
14.1	Code of Ethics for Principal Executive Officers and Senior Financial Officers
14.2	Code of Business Conduct
21.1	Metrobank, NA, Community Insurance, Inc. and Metrocorp Capital Trust I are the only subsidiaries of the Registrant
24.1	Power of Attorney (included on the signature page)
31.1	Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer
31.2	Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer
32.1	Section 1350 Certification of Chief Executive Officer
32.2	Section 1350 Certification of Chief Financial Officer
99.1	Charter of the Audit Committee of Metrocorp, Inc.

EX-3.1

EXHIBIT  3.1

ARTICLES OF INCORPORATION

Filed 3/1/2004

Secretary of State, State of Illinois

Filing Fee: $150.00; Franchise Tax $25.00; Total $175.00; File # 63399264; Approved: BE

1.	CORPORATE NAME: METROCORP MERGER CORPORATION
2.	Initial Registered Agent: Gary D. Andersen
	Initial Registered Office: 1523 8th Street, East Moline, IL 61244, County of Rock Island
3.	Purpose or purposes for which the corporation is organized: The transaction of any or lawful purposes for which corporations may be incorporated under the Illinois Business Corporation Act of 1983.
4.	Authorized Shares, Issued Shares and Consideration Received:
	Class: common; Number of Shares Authorized: 3,000,000; Number of Shares Proposed to be issued: 100; Consideration to be Received Therefor: $1,000.00; Total $1,000.00
	The preferences, qualifications, limitations, restrictions and special or relative rights in respect of the shares of each class are: par value is two dollars per share ($2.00).
5.	Optional:

(a)	Number of directors constituting the initial board of directors or the corporation: seven
(b)	Names and addresses of the persons who are to serve as directors until the first annual meeting of shareholders or until their successors are elected and qualify:

Name	Address
Ben H. Ryan, Jr.	2600 5th Court, East Moline, IL 61244
Gary D. Andersen	524 48th Avenue, East Moline, IL 61244
Jay Van Paemel	469 Ravine Avenue, Port Byron, IL 61275
Nancy R. Hamilton	2328 8th Street, East Moline, IL 61244
Dan Ligino	1407 19th Street, East Moline, IL 61244
Jeffry F. Guthrie	2174 10th Street Place, East Moline, IL 61244
David A. Skinner	3410 76th Street, Moline, IL 61265

6. Optional:

(a) It is estimated that the value of all property to be owned by the corporation for the following year wherever located will be: $1,000
(b) It is estimated that the value of the property to be located within the State of Illinois during the following year will be: $1,000
(c) It is estimated that the gross amount of business that will be transacted by the corporation during the following year will be: $100
(d) It is estimated that the gross amount of business that will be transacted from places of business in the State of Illinois during the following year will be: $100

7.	Optional: Other Provisions, e.g., authorizing preemptive rights, denying cumulative voting, regulating internal affairs, voting majority requirements, fixing a duration other than perpetual, etc.
	In furtherance and not in limitation of the powers conferred by statute, the board of directors of the Corporation is expressly authorized to make, alter or repeal the by-laws of the Corporation.

Whenever a compromise or arrangement is proposed between this Corporation and its creditors or any class of them and/or between this Corporation and its stockholders or any class of them, any court of equitable jurisdiction within the State of Illinois may, on the application in a summary way of this Corporation or of any creditor or stockholder thereof or on the application of any receiver or receivers appointed for this Corporation under Illinois law or on the application of trustees in dissolution order a meeting of the creditors or class of creditors, and/or of the stockholders or class of stockholders of this Corporation, as the case may be, to be summoned in such manner as the said court directs. If a majority in number representing three-fourths in value of the creditors or class of creditors, and/or of the stockholders or class of stockholders of this Corporation, as the case may be, agree to any compromise or arrangement and to any reorganization of this Corporation as consequence of such compromise or arrangement, the said compromise or arrangement and the said reorganization shall, if sanctioned by the court to which the said application has been made, be binding on all the creditors or class of creditors, and/or on all the stockholders or class of stockholders, of this Corporation, as the case may be, and also on this Corporation.

Meetings of stockholders may be held within or without the State of Illinois, as the by-laws may provide. The books of the Corporation may be kept (subject to any provision contained in the statutes) outside the State of Illinois at such place or places as may be designated from time to time by the board of directors or in the by-laws of the Corporation. Elections of directors need not be by written ballot unless the by-laws of the Corporation shall so provide.

The Corporation reserves the right to amend, alter, change or repeal any provision contained in these articles of incorporation, in the manner now or hereafter prescribed by statute, and all rights conferred upon stockholders herein are granted subject to this reservation.

Except as by-laws adopted by the stockholders may provide for a greater quorum requirement, a majority of the then outstanding shares of stock shall constitute a quorum at any meeting of the stockholders. Except as by-laws adopted by the stockholders may provide for a greater voting requirement, and except as provided below with respect to action on an Extraordinary Corporate Event (defined below), action on a matter other than the election of directors is approved if a quorum of all then outstanding shares of stock in the Corporation exists and such action is approved by the affirmative vote of a majority of such quorum. Any by-law adding, changing, or deleting a greater quorum or voting requirement for stockholders shall meet the same quorum requirement and be adopted by the same vote required to take action under the quorum and voting requirements then in effect or proposed to be adopted, whichever are greater. Voting on Extraordinary Corporate Events shall be governed by the following three ruler.

     (a) Extraordinary “Corporate Event. An “Extraordinary Corporate Event” shall mean an amendment to these Articles of Incorporation; a plan of merger or consolidation; the sale, lease, change, transfer or other disposition of all or substantially all of the assets of the Corporation; the granting of consent to the disposition of property other than in the ordinary course of business by an entity controlled by the Corporation; and a plan for the liquidation or dissolution of the Corporation.

     (b) Events Approved by the Board. With respect to action approved by the affirmative vote of a majority of the directors then in office on an Extraordinary Corporate Event, such action shall be approved by the affirmative vote of two-thirds of all then outstanding shares of stock in the Corporation entitled at the time to vote on such action.

     (c) Events Not Approved by Board. With respect to an action not approved by the affirmative vote of a majority of the directors then in office on an Extraordinary Corporate Event, such action shall be approved by the affirmative vote of 80 percent of the then outstanding shares of stock of the Corporation entitled at the time to vote on such action.

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	Officers of the Corporation or the Corporation’s subsidiaries shall not receive compensation, consideration or a promise of compensation or consideration from a company merging with the Corporation or surviving an acquisitions of the Corporation, in connection with a merger or acquisition, unless said compensation or consideration has been approved in advance by the board of directors of the Corporation. Compensation and consideration shall include, but shall not be limited to, employment contracts, bonuses, stock options, stock awards or other benefits associated with an acquisition or merger.
8.	Name(s) and Address(es) of Incorporator(s):
	The undersigned incorporator(s) hereby declare(s), under penalties of perjury, that the statements made in the foregoing Articles of Incorporation are true.
	Dated: February 9, 2004

Signature and Name	Address
METROCORP, INC.	1523 8th Street, East Moline, IL 61244
a Delaware corporation
By /s/ Gary D. Andersen, President	524 48th Avenue, East Moline, IL 61244
Attest:
/s/ Jay Van Paemel, Secretary	469 Ravine Avenue, Port Byron, IL 61275

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ARTICLES OF MERGER,

CONSOLIDATION OR EXCHANGE

Filed Apr 12, 2004

Secretary of State, State of Illinois

Filing Fee: $100.00; File # 6339-926-4; Approved: LT

1. Names of the corporations proposing to merge, and the state or country of their incorporation:

	State or
	County of
Name of Corporation	Incorporation	Corporation File Number
METROCORP, INC.	Delaware	F5041-934-7
METROCORP MERGER CORPORATION	Illinois	D6339-926-4

2. The laws of the state or country under which each corporation is incorporated permits such merger, consolidation or exchange.

3.    (a)      Name of the surviving corporation: METROCORP MERGER CORPORATION

       (b)      it shall be governed by the laws of: Illinois

4.	Plan of merger is as follows: See attached merger agreement
5.	Plan of merger was approved, as to each corporation not organized in Illinois, in compliance with the laws of the state under which it is organized, and (b) as to each Illinois corporation, as follows: (The following items are not applicable to mergers under §11.30 — 90% owned subsidiary provisions. See Article 7.)

Name of Corporation
METROCORP MERGER CORPORATION	By the shareholders, a resolution of the board
	of directors having been duly adopted and submitted
	to a vote at a meeting of shareholders. Not less
	than the minimum number of votes required by statute
	and by the articles of incorporation voted in favor of
	the action taken. (§11.20)

6.	Not applicable if surviving, new or acquiring corporation is an Illinois corporation: Not applicable
7.	If reporting a merger under §11.30—90% owned subsidiary provisions: Not applicable
8.	The undersigned corporations have caused these articles to be signed by their duly authorized officers, each of whom affirms, under penalties of perjury, that the facts stated herein are true.

Dated: March 15, 2004	Exact Name of Corporation: METROCORP, INC.
/s/ Gary D. Andersen, President
Dated March 15, 2004	Exact Name of Corporation: METROCORP MERGER CORPORATION
/s/ Gary D. Andersen, President

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MERGER AGREEMENT AND
PLAN OF REORGANIZATION

          THIS MERGER AGREEMENT AND PLAN OF REORGANIZATION (this “Agreement”) is entered into as of the 15th day of March, 2004, by METROCORP, INC., a Delaware corporation (“Metro”), and METROCORP MERGER CORPORATION, an Illinois corporation (“MMC”).

          WHEREAS, Metro is a registered bank holding company under the Bank Holding Company Act of 1956, as amended, in the business of owning and operating commercial banks and is a corporation organized under the laws of the State of Delaware on the 27th day of August 1973;

          WHEREAS, MMC is an Illinois corporation formed on March 1, 2004 to transact any or lawful purposes for which a corporation may be incorporated under Illinois law, and

          WHEREAS, the Boards of Directors of Metro and MMC have each approved and authorized the terms and provisions of this Agreement; and

          WHEREAS, Metro created MMC, totally funded MMC, and owns all issued and outstanding shares of MMC.

          NOW, THEREFORE, in consideration of these premises and the covenants contained herein, the parties hereto enter into this Agreement and prescribe the terms and conditions of the consolidation and the manner of carrying it into effect as follows:

ARTICLE I
DEFINITIONS

          1.1 “Bank” shall mean Metrobank, N.A., a national banking association.

          1.2 “Code” shall mean the Internal Revenue Code of the United States, as amended.

          1.3 “Effective Date”, shall mean the date of consummation of the Merger as specified in the Acknowledgment of Merger to be issued by the Illinois Secretary of State, subject to a similar acknowledgment being issued by the Delaware Secretary of State, after the filing of the Articles of Merger in both states.

          1.4 “Merger”, shall mean the merger of Metro with and into MMC, as described more fully herein.

          1.5 “Metro Shareholders” shall mean the holders of record of the common stock of Metro.

          1.6 “Metro Stock”, shall mean the $2.00 par value common stock of Metro, of which 300,000 shares are authorized, 249,003 shares are issued, and 137,549 shares are outstanding.

          1.7 “Proxy” shall mean the proxy card distributed to Metro Shareholders prior to the Shareholders’ Meeting naming the individuals who will act as proxies with respect to the Metro Shares represented thereby for the purpose of approving this Agreement and the Merger at the Shareholders’ Meeting.

          1.8 “Shareholders’ Meeting” shall mean the Annual Meeting of Shareholders of Metro called for the purpose of approving and ratifying the terms and conditions of this Agreement and the Merger held on December 15, 2003.

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          1.9 “Surviving Corporation”, shall mean MMC, after the Effective Date, as the corporation surviving the Merger, and MMC shall assume the name of “Metrocorp, Inc.” upon the Effective Date.

ARTICLE II
PLAN OF REORGANIZATION,

          2.1 Merger. Upon the Effective Date, Metro shall merger with and into MMC and the separate corporate existence of Metro shall thereafter cease. The Surviving Corporation, MMC, shall operate under the Articles of Incorporation and Bylaws of MMC, and shall continue to hold the Bank as its principal business. Article I of the Articles of Incorporation of the Surviving Corporation shall be amended to change the name of the corporation to “Metrocorp, Inc.” All minutes, resolutions, and policies of the Delaware corporation of Metro shall be deemed to be the minutes, resolutions, and policies of MMC for all intents and purposes.

          2.2 Effect of the Merger.

                2.2.1 Assets and Rights. Upon the merger becoming effective, all rights, privileges, and franchises of Metro, and all debts and liabilities due or to become due to Metro, including every interest or asset of conceivable value or benefit, shall be deemed fully and finally and without any right of reversion transferred to and vested in the Surviving Corporation without further act or deed, and the Surviving Corporation shall have and hold the same in its own right as fully as the same was possessed and held by Metro.

                2.2.2 Liabilities. Upon the merger becoming effective, all debts, liabilities, and obligations due or to become due, all claims or demands for any cause existing against Metro shall be and become the debts, liabilities, obligations of and the claims and demands against, the Surviving Corporation in the same manner as if the Surviving Corporation had itself incurred or become liable for them.

                2.23 Accounting. From and after the Effective Date, the assets and liabilities of Metro and of MMC shall be entered on the books of MMC at the amounts at which they shall be carried at such time on the respective books of Metro and of MMC, subject to such inter-corporate adjustments or eliminations, if any, as may be required to give effect to the merger, and, subject to such action as may be taken by the Board of Directors of MMC, in accordance with generally accepted accounting principles, the capital and surplus of MMC shall be equal to the capital and surplus of Metro as it existed immediately prior to the Effective Date.

                2.2.4 Board of Directors. Upon the Effective Date, the Board of Directors of the Surviving Corporation shall consist of all the persons who are directors of Metro immediately prior to the Effective Date.

                2.2.5 Stock Records. After the close of business on March 15, 2004, the Metro record date, there shall be no transfer of Metro Stock on the stock records of Metro. The Surviving Corporation shall be entitled to rely upon the stock records of Metro to establish the identity of the Shareholders entitled to receive consideration under the terms of this Agreement, and the stock records of Metro shall be conclusive for such purpose. In the event of a dispute with respect to ownership of Metro Stock, the Surviving Corporation shall be entitled to interplead any such consideration and thereby be relieved of liability with respect to competing claims.

                2.2.6 Stock Certificates. Upon the Effective Date, each share of Metro Stock automatically shall be converted into a corresponding share of MMC Stock and, from and after the Effective Date, the holders of all of said issued and outstanding shares of Metro automatically shall be

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and become holders of shares of MMC upon the basis above specified, whether or not certificates representing said shares are then issued and delivered. Each warrant, option or other derivative security to purchase or sell common stock of Metro which is effective immediately prior to the Effective Date shall be converted into a warrant, option or other derivative security to purchase or sell common stock of MMC, as of the Effective Date. Such instruments shall be exercisable in accordance with their terms and conditions. On each matter on which common stock shall vote, each common share shall be entitled to one vote. Shareholders shall be entitled to surrender certificates of Metro to receive in exchange a certificate representing a like number of shares of MMC, pursuant to the terms of Article III of this Agreement Until so surrendered, each outstanding certificate which prior to the effective time of the merger represented one or more shares of common stock of Metro shall be deemed for all corporate purposes to evidence ownership of the same number of shares of common stock of MMC.

                2.3 Service of Process. MMC, as the Surviving Corporation, agrees that it may be served with process in the State of Delaware in any proceeding for enforcement of any obligation of any constituent corporation of Delaware, as well as for enforcement of any obligation of the Surviving Corporation arising from this merger, including any suit or other proceeding to enforce the rights of any stockholders as determined in appraisal proceedings pursuant to the provisions of Section 262 of the Delaware General Corporation laws, and irrevocably appoints the Secretary of State of Delaware as its agent to accept service of process in any such suit or proceeding. The Secretary of State shall mail any such process to the Surviving Corporation at Metrocorp, Inc., 1523 — 8th Street, East Moline, Illinois 61244.

                2.4 Further Assurances. Metro and MMC each agree that at any time, or from time to time, as and when requested by the Surviving Corporation, or by its successors and assigns, it will execute and deliver, or cause to be executed and delivered in its name by its last acting officers, or deeds or other instruments, and will take or cause to be taken such further or other action as the Surviving Corporation, its successors or assigns may deem necessary or desirable, in order to evidence the transfer, vesting or devolution of any estate property, right, privilege or franchise or to vest or perfect in or conform to the Surviving Corporation, its successors and assigns, title to and possession of all the estates property, powers, rights, privileges, franchises and interests referred to in this Article II and otherwise to carry out the intent and purposes hereof.

ARTICLE III
EXCHANGE OF SHARES

          3.1 Shareholders Who Are to Receive MMC Shares. Upon the Effective Date, each share of Metro Stock held of record by a Metro Shareholder shall, upon completion of a Letter of Transmittal, be entitled to receive one share of MMC Stock.

                Metro Shareholders wishing to exchange Metro shares for MMC shares shall, after the Effective Date, tender their certificates formerly representing their shares of Metro to MMC pursuant to a Letter of Transmittal MMC will mail to them at the address shown on the stock records of Metro. The Letter of Transmittal shall provide that result of loss as to such certificates shall pass to MMC only upon delivery of such certificates. Each Metro Shareholder who surrenders for exchange certificates representing shares of Metro, together with a duly executed Letter of Transmittal to MMC will, upon acceptance by MMC, be entitled to receive shares of MMC in exchange for such shares of Metro. MMC shall accept certificates and Letters of Transmittal which comply with terms and instructions it may impose to effect an orderly exchange. Certificates shall be appropriately endorsed or accompanied by such instruments of transfer as MMC may reasonably require and as set out in the Letters of Transmittal furnished to the Metro Shareholders.

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                3.2 MMC shall prepare and deliver to Metro Shareholders the appropriate Letters of Transmittal for the exchange of Metro Shares for MMC Shares.

                3.3 MMC Shareholder. Upon the Effective Date, each share of MMC Stock held of record by an MMC shareholder shall, without further action, be canceled and extinguished. This provision refers only to the shares of MMC held by Metro prior to the Effective Date.

ARTICLE IV
REPRESENTATIONS AND WARRANTIES

          4.1 Representations and Warranties of MMC. MMC represents and warrants to Metro as follows:

                4.1.1 Organization and Authority. MMC is a corporation duly organized, validly existing and in good standing under the laws of the State of Illinois.

                4.1.2 Capitalization. MMC has 300,000 authorized shares of common stock, with 100 shares of common stock issued and outstanding as of the close of business on March 15, 2004, and no other shares of stock of MMC will be issued prior to the Effective Date, and no shares of MMC will be redeemed or otherwise purchased as treasury shares prior to the Effective Date. No equity security of MMC is required to be issued by reason of any option, warrant, scrip, right to subscribe to, call or commitment of any nature relating to shares of stock of MMC or of any subsidiary, and there are no contracts, commitments, understandings or arrangements by which MMC is bound to issue additional shares of its stock or any option, warrant or right to purchase or acquire any additional shares of its stock. All of the issued and outstanding shares of MMC are fully paid and nonassessable.

                4.1.3 Authorization. MMC has the corporate power and authority to enter into this Agreement to carry out its obligations hereunder. The execution, delivery and performance of this Agreement by MMC and the consummation of the transactions contemplated by this Agreement have been authorized by the Board of Directors of MMC and its shareholder, Metro. This Agreement is a valid and binding obligation of MMC, enforceable against MMC in accordance with its terms. The execution and performance of this Agreement by MMC will not violate, conflict with or result in a breach of any provision of or constitute a default under or result in the termination of, or accelerate the performance required by, or result in right of termination or acceleration of, or result in the creation of any lien, security interest, charge or encumbrance of any of the properties or assets of MMC under its Articles of Incorporation, Bylaws, note, bond, mortgage, indenture, deed of trust, license, lease, agreement or other instrument or obligation to which MMC is a party, and will not violate any judgment, ruling, order, writ, injunction, statute, rule or regulation applicable to MMC or any of its properties or assets.

          4.2 Representations and Warranties of Metro. Metro represents and warrants to MMC as follows:

                4.2.1 Organization and Authority. Metro is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware, and is duly qualified to so business and is in good standing in all jurisdictions where its ownership or leasing of property or the conduct of its business requires it to be so qualified, and failure to be so qualified would have a material adverse effect on Metro, its corporate power and its authority to do business.

                4.2.2 Capitalization. Metro has 300,000 authorized shares of common stock, with 249,003 shares of common stock issued and 137,549 shares of common stock outstanding as of the close of business on March 15, 2004, and no other shares of stock of Metro will be issued prior to the

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Effective Date, and no shares of Metro will be redeemed or otherwise purchased as treasury shares prior to the Effective Date. All of the outstanding shares of Metro are fully paid and nonassessable.

                4.2.3 Authorization. Metro has the corporate power and authority to enter into this Agreement and to carry out its obligations hereunder. The execution, delivery and performance of this Agreement by Metro and the consummation of the transactions contemplated by this Agreement have been authorized by the Board of Directors of Metro, submitted to the shareholders of Metro by Proxy, and was approved at the Shareholders’ Meeting. This Agreement is a valid and binding obligation of Metro, enforceable against Metro in accordance with its terms. The execution and performance of this Agreement by Metro will not violate, conflict with or result in a breach of any provision of or constitute a default under or result in the termination of, or accelerate the performance required by, or result in right of termination or acceleration of, or result in the creation of any lien, security interest, charge or encumbrance of any of the properties or assets of Metro under its Articles of Incorporation, Bylaws, note, bond, mortgage, indenture, deed of trust, license, lease, agreement or other instrument or obligation to which Metro is a party, and will not violate any judgment, ruling, order, writ, injunction, statute, rule or regulation applicable to Metro or any of its properties or assets.

ARTICLE V
CONDITIONS AND TERMINATION

          5.1 Conditions. Effectuation of the Merger as herein provided for is conditioned upon:

                5.1.1 Ratification and confirmation of this Agreement by a vote of at least two-thirds of the outstanding shares of Metro Stock as required by law and Metro’s Articles of Incorporation, which was satisfied at the Shareholders’ Meeting; and

                5.1.2 Procurement of all other consents and approvals and satisfaction of all other requirements prescribed by law which are necessary for consummation of the Merger.

          5.2 Termination. This Agreement may be terminated prior to the Effective Date of the Merger by Metro by written notice delivered to MMC, authorized and approved by resolution adopted by the Board of Directors of Metro, if:

                5.2.1 Any action, suit, proceeding or claim has been instituted, made or threatened relating to the proposed Merger which shall make consummation of the Merger inadvisable in the opinion of the Board of Directors of Metro; or

                5.2.2 Any action, consent or approval, governmental or otherwise which is, or in the opinion of counsel for Metro may be, necessary to permit or enable Metro, upon and after the Merger, to conduct all or any part of the business and activities of Metro up to the time of Merger, in the manner in which such activities and business are then conducted, shall not have been obtained; or

                5.2.3 For any other reason consummation of the Merger is inadvisable in the opinion of the Board of Directors of Metro.

          5.3 Release. Upon termination by written notice as provided in Section 5.2, this Agreement shall be void and of no further effect, and there shall be no liability by reason of this Agreement or the termination thereof on the part of Metro, MMC or the directors, officers, employees, agents or shareholders or either of them, and all such parties shall be released from all such liability.

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ARTICLE VI
MISCELLANEOUS

          6.1 Waivers and Amendment. Any term or condition of this Agreement may be waived at any time by a party entitled to the benefit thereof if such waiver is in writing and, when applicable, if authorized by the Board of Directors of such party. This Agreement may be amended at any time prior to the Effective Date of the Merger if such amendment is in writing and is approved by the Board of Directors of each of the parties hereto.

          6.2 Entire Agreement. This Agreement contains the entire agreement between the parties hereto, with respect to the transactions effected by this Agreement and any related transactions, and supercedes all prior arrangements or understandings, whether oral or written, among the parties with respect thereto.

          6.3 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original instrument but all such counterparts together shall constitute but one agreement

          6.4 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Illinois except to the extent that Delaware law applies or that federal law may preempt any of the terms, conditions or provisions hereof in which extent federal law will govern the terms of this Agreement

          6.5 Notices. All notices which are required to be given or may be given to the parties pursuant to the terms of this Agreement shall be sufficient in all respects if given in writing and delivered personally or by prepaid express mail or courier as follows:

METRO:	Gary D. Andersen, President
	METROCORP, INC.
	1523 — 8th Street
	East Moline, IL 61244-2190
MMC:	Gary D. Andersen, President
	METROCORP MERGER CORPORATION
	1523 — 8th Street
	East Moline, IL 61244-2190

     IN WITNESS WHEREOF, Metro and MMC have caused this Agreement to be executed in counterparts by their duly authorized officers as of the date first above written, and directors constituting a majority of the Board of Directors of each such entity have hereunto subscribed their names.

	METROCORP, INC.
Attest:
/s/ J. Van Paemel, Secretary and Director	/s/ Gary D. Andersen, President and Director
	METROCORP MERGER CORPORATION
Attest:
/s/ J. Van Paemel, Secretary and Director	/s/ Gary D. Andersen, President and Director

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ARTICLE OF AMENDMENT

Secretary of State, State of Illinois

Filing Fee: $50.00; File # 2004-13210; Approved: NGZ

1.	CORPORATE NAME: METROCORP, INC.
2.	MANNER OF ADOPTION OF AMENDMENT:
	The following amendment of the Articles of Incorporation was adopted on April 19, 2004 in the manner indicated below.
	By the shareholders, in accordance with Section 10.20, a resolution of the board of directors having been duly adopted and submitted to the shareholders. At a meeting of shareholders, not less than the minimum number of votes required by statute and by the articles of incorporation were voted in favor of the amendment.*
3.	TEXT OF AMENDMENT:

a. When amendment effects a name change, insert the new corporate name below. Use
Page 2 for all other amendments.
Article I: The name of the corporation is:

b. (if amendment affects the corporate purpose, the amended purpose is required to be set forth in its entirety. If there is not sufficient space to do so, add one or more sheets of this size.)

Paragraph 2 of Article 4 of the Articles of Incorporation shall be amended to decrease the par value per share from $2.00 to $.20.

*The effective time and date of the document is the later of the following:

a. the time of filing on the date it is filed;
b. the time specified in the document on the date it is filed;
c. the time and date specified in the document, not later than 90 days after the date it is filed.

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APPLICATION FOR AMENDED CERTIFICATE OF AUTHORITY

To the Secretary of State of the State of Iowa:

Pursuant to section 1504 of the Iowa Business Corporation Act, the undersigned corporation applies for an amended certificate of authority to transact business in Iowa, and states:

1.	The name of the corporation is METROCORP, INC. and the name the corporation uses in Iowa if different than its real name is (SAME). The corporate name has been changed to (UNCHANGED).
2.	The state (or foreign country) of incorporation on the records of the Secretary of State of Iowa is Delaware. The state (or foreign country) of incorporation has been changed to Illinois.
3.	The duration of the corporation on the records of the Secretary of State of Iowa is perpetual. The duration has been changed to (Unchanged).
4.	The date of incorporation of the corporation was August 27, 1973.
5.	The street address of its principal office is 1523 — 8th Street, East Moline, Illinois 61244.
6.	The street address of its registered office in Iowa and the name of its registered agent at that office: Marcus V. Hobert, 2322 East Kimberly Road, Davenport, Iowa 52807.
7.	The names and business addresses of its current directors and officers:
	Gary D. Andersen, Director and President, 524 — 48th Avenue, East Moline, Illinois 61244 Jay Van Paemel, Director and Secretary, 469 Ravine Avenue, Port Byron, IL 61275 Ben H. Ryan, Jr., Director and Chairman, 2600 — 5th Court, East Moline, IL 61244 Nancy R. Hamilton, Director and Vice President, 2328 — 8th Street, East Moline, IL 61244
	See attached supplement
8.	A certificate of existence, or a document of similar import, duly authenticated by the official having custody of corporate records in the state or county of incorporation, accompanies this application.
9.	Signature /s/ Gary D. Andersen, President

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REPORT FOLLOWING MERGER OR CONSOLIDATION

Franchise Tax: $981.82; Filing Fee: $5.00; Total $986.82
File # 6339-926-4; Date: Apr 14, 2004; Approved: LT

Secretary of State, State of Illinois

1.	CORPORATE NAME:                                                           METROCORP, INC.
2.	STATE OR COUNTRY OF INCORPORATION:                 Illinois
3.	Issued shares of each corporation party to the merger prior to the merger:

			Par		Number
Corporation	Class	Series	Value		of Shares
METROCORP, INC.	common	none		2.00		249,003
METROCORP MERGER CORPORATION	common	none		2.00		100

4. Paid-in Capital of each corporation party to the merger prior to the merger:

Corporation	Paid-in Capital
METROCORP, INC.	$	4,789,079
METROCORP MERGER CORPORATION	$	1,000

5. Description of the merger: (Include effective date and a brief explanation of the conversion as stated in the plan of merger.) METROCORP, INC., a Delaware created, totally funded, and wholly owns METROCORP MERGER CORPORATION. METROCORP shareholders receive shares of surviving corporation on a 1 to 1 basis and existing shares of METROCORP MERGER CORPORATION are canceled and extinguished. The purpose of the merger was to change the state of incorporation from Delaware to Illinois, to be effective when acknowledged by the respective secretary of states. [eff 4-12-04]

6. Issued shares after merger:

Class	Series	Par Value	Number of Shares
common	none	2.0	249,003

7. Paid-in Capital of the surviving or new corporation: $4,789,079. (“Paid-in Capital” replaces the terms Stated Capital and Paid-in Surplus and is equal to the total of these accounts.)

8. The undersigned corporation has caused this statement to be signed by a duly authorized officer who affirms, under penalties of perjury, that the facts stated herein are true:

     Dated Apr. 12, 2004           METROCORP, INC.

     /s/ Gary Andersen, President                                                     

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EX-3.2

EXHIBIT  3.2

BY-LAWS
OF
METROCORP, INC.

ARTICLE I
OFFICES

     SECTION 1. Principal Offices. The principal office of the Corporation in the State of Iowa shall be located in the City of Davenport and County of Scott. The principal office in the State of Illinois shall be located in the City of East Moline and County of Rock Island. The Corporation may have such other offices, either within or without the States of Illinois or Iowa, as the business of the Corporation may require from time to time.

     SECTION 2. Registered Office. The registered office shall be in the City of East Moline, County of Rock Island, State of Illinois.

ARTICLE II
STOCKHOLDERS

     SECTION 1. Annual Meeting. There shall be an annual meeting of the stockholders on the third Monday in December of each year at one thirty o’clock P.M. for the election of Directors and for the transaction of such other business as may come before the meeting. The place of the meeting shall be at the principal office of the Corporation in the State of Illinois. The Directors by a majority affirmative vote may designate an alternate place, date, or hour.

     SECTION 2. Special Meetings. A special meeting of the stockholders may be called at any time by the Board of Directors, and may be called upon request in writing from the holders of at least fifty-one percent of the capital stock specifying the purpose or purposes for which such meeting shall be called.

     SECTION 3. Notice of Meetings. Unless a different manner of giving notice is prescribed by statute, written or printed notice stating the place, day and hour of the meeting, and in case of a special meeting, the purpose or purposes for which the meeting is called, shall be delivered not less than ten nor more than forty days before the date of the meeting either personally or by mail, to each stockholder of record entitled to vote at such meeting. If mailed, such notice shall be deemed to be delivered when deposited in the United States mail with postage thereon prepaid addressed to the stockholder at the stockholder’s address as it appears on the records of the Corporation. Whenever any notice is required to be given under the provision of the statutes or of the certificate of incorporation or of these By-laws, a waiver thereof in writing, signed by the person or persons entitled to such notice, whether before or after the time stated therein, shall be deemed equivalent to notice.

     SECTION 4. Closing of Transfer Books or Fixing of Record Date. For the purpose of determining stockholders entitled to notice of or to vote at any meeting of the stockholders, or stockholders entitled to receive payment of any dividend, or in order to make a determination of stockholders for any other proper purpose, the Board of Directors may provide that the stock transfer books shall be closed for a stated period but not to exceed, in any case, forty days. In lieu of closing the stock transfer books, the Board of Directors may fix in advance a date as the record date for any such determination of stockholders, such date in any case to be not more than forty days, and in case of a meeting of the stockholders, not less than ten days prior to the date on which the particular action, regarding such determination of stockholders, is to be taken. If the stock transfer books are not closed and no record date is fixed for the determination of stockholders entitled to notice of or to vote at a meeting of the stockholders, or stockholders entitled to receive payment of a dividend, the date on which notice of a meeting is mailed or the date on which the resolution of the Board of Directors declaring

such dividend is adopted, as the case may be, shall be the record date of such determination of stockholders.

     SECTION 5. Inspectors of Election. Inspectors of Election shall be appointed by the Board of Directors or the Executive Committee to act at any meeting of stockholders at which any election is held. The Inspectors of Election shall examine proxies, pass upon their regularity, receive the votes and act as tellers, or perform any other duties which the stockholders may require of them at said meeting.

     SECTION 6. Quorum. A majority of the outstanding shares, represented in person or by proxy, shall constitute a quorum at a meeting of the stockholders. In the absence of a quorum, a meeting may be adjourned from time to time without notice to the stockholders. Unless otherwise provided by law, a majority of the votes cast shall decide every matter submitted to the stockholders at any meeting.

     SECTION 7. Voting Rights. Each outstanding share shall be entitled to one vote on each matter submitted to a vote at a meeting of the stockholders. In all elections for Directors every stockholder shall have the right to vote, in person or by proxy, for the number of shares of stock owned by the stockholder, for as many persons as there are Directors to be elected.

     SECTION 8. Proxies. At all meetings of stockholders, a stockholder may vote either in person or by proxy executed in writing by the stockholder or by the stockholder’s duly authorized attorney-in-fact. Such proxy shall be filed with the Secretary before or at the time of the meeting. No proxy shall be valid after three years from the date of its execution, unless otherwise provided in the proxy.

ARTICLE III
DIRECTORS

     SECTION 1. General Powers. The business and affairs of the Corporation shall be managed by its Board of Directors.

     SECTION 2. Number, Tenure and Qualifications. The Board of Directors of the Corporation shall consist of such number of Directors, not less than five (5) nor more than twenty-five (25), as shall be fixed from time to time by the Directors or the stockholders in accordance with the provisions of the general corporate laws of the State of Illinois and the Certificate of Incorporation. The number of Directors which shall constitute the whole Board shall be seven upon adoption of these By-laws. Each Director shall own free of any lien or encumbrance the number of shares of the capital stock required by law.

     SECTION 3. Regular Meetings. A regular meeting of the Board of Directors shall be held at least once each month at such place, date and hour as the Board may appoint. In the absence of a specific resolution setting an alternative place, date, or hour, the regular meeting of the Board of Directors shall be held without notice at two-thirty o’clock P.M. on the third Monday of each month at the principal office of the Corporation in the State of Illinois. If an alternative place, date or hour is appointed, then and only then shall notice be given to the Directors which may be given by telephone, fax, or orally. Whenever any notice is required to be given to Directors under the provisions of law, the Certificate of Incorporation, or these By-laws, a written waiver signed by the Director whether before or after the time stated herein, shall be deemed equivalent to notice.

     SECTION 4. Special Meetings. Special meetings of the Board of Directors may be called by or at the request of the Chairman of the Board or any two Directors. The person or person requesting such meeting may fix the time and place thereof. Notice of any special meeting shall be mailed to or left for the Directors at their offices or homes, or delivered or given in person at least twenty-four hours prior to the meeting. Whenever any notice is required to be given to Directors under the provisions of law, the

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Certificate of Incorporation, or these By-laws, a written waiver signed by the Director whether before or after the time stated herein, shall be deemed equivalent to notice.

     SECTION 5. Quorum. A majority of the Board of Directors shall constitute a quorum for the transaction of business at any meeting of the Board of Directors, provided that if less than a majority of the Directors are present at said meeting, a majority of the Directors present may adjourn the meeting from time to time without further notice.

     SECTION 6. Manner of Acting. The act of the majority of the Directors present at a meeting at which a quorum is present shall be the act of the Board of Directors, except on additions, amendments, repeal or any changes whatsoever in the By-laws or the adoption of new By-laws, when the affirmative votes of at least a majority of the members of the Board shall be necessary for the adoption of such changes. On any question, the Chairman of the Board may call for voice vote, acclamation, show of hands, or written ballot. Directors shall not vote by secret ballot. Any Director, including the Chairman of the Board, may order that a vote be taken by yeas and nays, in which case the Secretary shall call the roll, and record the answer of each Director individually.

     SECTION 7. Directors’ Compensation. The Directors shall receive such compensation as may be fixed by the Board for attendance at meetings of the Board or for service on any Committee of the Board.

     SECTION 8. Vacancies. If a vacancy occurs on the Board of Directors, including a vacancy resulting from an increase in the number of Directors, the vacancy may be filled by the stockholders, a majority of the Board of Directors remaining in office, or, if the Directors remaining in office constitute fewer than a quorum, by an affirmative vote of a majority of all the Directors remaining in office.

     SECTION 9. Honorary Directors. There is hereby created the office of Honorary Member of the Board of Directors. An Honorary Director shall be nominated by the Chairman of the Board of Directors or by any member of the Board and shall be elected by a majority of the Board of Directors at any regular or special meeting for a period of one year from such election. Honorary Directors may attend any special or regular meeting of the Board, but shall receive no remuneration therefore. Honorary Directors shall be allowed to speak on all matters brought before the Board and shall give advice and recommendations to the Board as requested. Honorary Directors shall have no power to vote or to be counted as present for the purpose of a quorum. Honorary Directors shall be elected by the Board of Directors by reason of past distinguished service to the Board, the Corporation, or the community, or other reasons determined by the Board. Any listing of Honorary Directors shall indicate their status as Honorary Directors.

ARTICLE IV
STANDING COMMITTEES

     SECTION 1. Executive Committee. The Chairman of the Board shall at the annual organizational meeting held after the annual stockholders meeting, appoint two Directors who, with the Chairman of the Board and the President, shall constitute and be called the Executive Committee. In case of the absence or inability to act of either the Chairman of the Board or the President, a Vice-President shall act as a member of the Executive Committee. Each Director so appointed shall act as a member of the Committee until another is appointed and acts in that Director’s place. The Chairman of the Board shall preside at all meetings of the Committee, and in case any member or members of the Executive Committee are unable to be present at any meeting, the Chairman of the Board or the remaining members or member of the Executive Committee, or such of said members as are present, may appoint another Director or another Directors to act temporarily in place of such absent member or members. In case of the absence or inability to act of the Chairman of the Board to act as the Chairman

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of the Executive Committee, the duties and powers given to the Chairman in this Article shall vest in the President. Three members of the Executive Committee shall constitute a quorum for the transaction of business. The Executive Committee may, while the Board of Directors is not in session, exercise all or any such of the powers of the Board of Directors as the Board may lawfully delegate. The Executive Committee shall, at all times be subject to call of the Chairman of the Board or any member of the committee, and will otherwise meet as needed. The Executive Committee shall report all its actions at the next regular meeting of the Board of Directors.

     SECTION 2. Audit Committee. An Audit Committee, consisting of two outside Directors who are not also on any banking Trust Committee shall be appointed each year by the Chairman of the Board or the Executive Committee for the purpose of reviewing the Corporation’s internal auditing program, the scope of the work being done by certified public accountants and reports of examinations by supervising authorities. The Committee may report to the Board of Directors, in writing, the results of their review.

     SECTION 3. Other Committees. The Chairman of the Board may appoint from time to time other committees of Directors for such purposes and with such powers as the Board may determine.

ARTICLE V
THE OFFICERS

     SECTION 1. Number and Term of Office. The officers of the Corporation shall be a Chairman of the Board, and a President, each of whom shall be a Director, one or more Vice Presidents, a Secretary, an Auditor, and such other officers as may from time to time be appointed by the Board of Directors. Any two or more offices may be held by the same person, except the President and the Secretary. The officers of the Corporation shall be elected or appointed annually by the Board of Directors at the first meeting of the Board of Directors held after each annual meeting of stockholders. Vacancies or new offices may be filled at any time. Each officer shall hold office until a successor shall have been duly elected or appointed or until that officer’s death or until the officer shall resign or shall have been removed by the Board of Directors.

     SECTION 2. Removal. Any officer may be removed by the Board of Directors whenever in its judgment the best interests of the Corporation would be served thereby.

     SECTION 3. Chairman of the Board. The Chairman of the Board shall preside at all meetings of the Board and at all meetings of the Executive Committee and at all meetings of the stockholders.

     SECTION 4. President. The President shall be the Chief Executive Officer of the Corporation. In the absence of the Chairman of the Board, the President shall preside at all meetings of the Board or Executive Committee, and also shall preside at all meetings of the stockholders. The President shall have the power and shall exercise the duties pertaining generally to the office of the President, including those conferred or imposed by statute and shall be the general supervisor of the affairs and business of the Corporation and the management thereof subject to the direction of the Board of Directors or of the Executive Committee. In all cases where the duties of the other executive officers are not prescribed by statute, in these By-laws or by resolution of the Directors, they shall be performed under the orders and instructions of the President. The President shall perform the duties of a treasurer, shall have the custody of the corporate funds and securities, shall keep full and accurate accounts of receipts and disbursements in books belonging to the corporation and shall deposit all moneys and other valuable effects in the name and to the credit of the corporation in such depositories as may be designated by the Board of Directors.

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     In the case of the death, absence, or other inability to act of the President, all of the President’s powers and duties of all kinds under these By-laws and under the laws under which the Corporation is created may be vested in and discharged by any officer as designated by the Board of Directors, and in performing, in the absence or during the disability of the President, any of the duties imposed by the laws under which this Corporation is organized, such officer shall sign as President and, for such purposes, shall actually be the President of this Corporation.

     SECTION 5. Loans, Purchases and Sales of Property. The President, or any Vice President or any other officer granted lending authority by the Board of Directors, is authorized and empowered to make discounts and loans, grant acceptance credits, execute commercial acceptances; is authorized and empowered to purchase any drafts, acceptances, notes, stocks, bonds or other securities, or any real or personal property, with the funds of the Corporation or funds held by the Corporation in any fiduciary capacity or otherwise, and is further authorized and empowered to sell, exchange, transfer or dispose of any of the same whether held by the Corporation in an investment, fiduciary or other capacity or transferred to or held by the Corporation by way of collateral security or any debt or loan; and the officer may in that officer’s discretion execute and acknowledge all proper and necessary instruments and papers in connection with any of the foregoing within such limits, if any, as may be set out by the Board. The Secretary or other officer designated by the President from time to time in writing, is authorized to exercise any of the above powers and perform any of the above functions within such limits, if any, as may be set out in such Executive Instructions.

     SECTION 6. Borrowing. The President and any Vice President or any two Vice Presidents shall have authority to borrow money and to pledge or hypothecate any securities or any stocks, bonds, notes or any property, real or personal, belonging to the Corporation, or rediscount any notes or obligations belonging to the Corporation, whenever in their judgment it is necessary so to do, and to indorse or guarantee in its name any notes or obligations payable to or belonging to the Corporation, or to execute in its name and acknowledge any instrument or instruments, assignment or assignments, of any bonds, certificates of stock, or any property, real or personal, belonging to the Corporation required for such purpose or purposes.

     SECTION 7. Other Corporate Acts. The President or any Vice President or any other officer is authorized, in that officer’s discretion, to do or perform any and all corporate and official acts in carrying on the business of the Corporation, either of its own or when acting in any fiduciary capacity whatsoever, and he is hereby empowered, in that officer’s discretion, to appoint all necessary agents and attorneys, also to make, execute and acknowledge all deeds, mortgages, releases, leases, agreements, proxies, contracts, bills of sale, mortgage, lease, assignment, transfer, management or handling in any way of any property of any description held or controlled by the Corporation, either in its own right or in any fiduciary capacity, and either the Secretary or any Vice President is authorized to attest and affix the corporate seal to any and all instruments in writing requiring such attestation or which are executed under seal. The enumeration of particular powers to this By-law shall not restrict or be taken to restrict in any way the general powers and authority herein given to said officers or any of them.

     SECTION 8. Receipt of Property. The President or any Vice President or any other officer shall have the power to receive the principal, interest and dividends on all United States and other bonds and stocks and on all other corporate and other securities owned by the Corporation, or held by it in trust or as agent, or in any other fiduciary capacity, and to receipt for the same if required.

     SECTION 9. Other Authorities. The President or any Vice President or any other officer shall have authority to sign checks, drafts, certifications, receipts and orders for the payment money, receipts for securities and orders for the delivery of securities; to endorse notes, bills, checks, drafts, certificates of deposit and acceptances, in all the business transactions of the Corporation.

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     SECTION 10. The Secretary. The Secretary shall have the custody of the corporate seal and the Secretary shall affix the same to all instruments or papers requiring the seal of the Corporation. The Secretary shall see that proper notices are sent of the meetings of the stockholders, the Board of Directors and the Executive Committee, and shall see that all proper notices are given, as required by these By-laws. The Secretary shall keep the minutes of all meetings of stockholders and Directors and all committees which may request their services.

     In case of the death, absence or other inability to act of the Secretary, all the Secretary’s powers and duties of all kinds under these By-laws and under the laws under which the Corporation is created shall be vested in and discharged by any one of the Vice Presidents until the Board of Directors designates a new Secretary, and, in performing in the absence or during the disability of the Secretary, any of the duties imposed by the laws under which this Corporation is organized, any other officer except for the President shall sign as Secretary and, for such purposes, shall actually be the Secretary of this Corporation.

     SECTION 11. The Auditor. The Auditor and Assistant Auditors shall make examinations from time to time of all the affairs, books, accounts, statements, money, securities and assets owned by the Corporation, or held by it in any fiduciary capacity, reporting in writing the results of the examination to the Board of Directors at its next meeting. Should the Auditors in their examination find any irregularities in any of the books, accounts, statements, monies, securities, assets or affairs of the Corporation, either in its individual or in any fiduciary capacity, they shall at once report the same in writing to the Chairman of the Board, to the President, and to the Board of Directors at its next meeting.

     SECTION 12. Releases. The President or any Vice President or any other officer is authorized to sign the corporate name to all releases and satisfactions of trust deeds and mortgages under which the Corporation is acting as a fiduciary or Mortgagee and either the Secretary or any other officer is authorized to attest the signature of the officer so signing and to affix the corporate seal to said instrument; and all releases deeds and satisfactions of mortgages so signed, sealed and attested shall be valid instruments of the Corporation.

     SECTION 13. Additional Authorizations. The Board of Directors may authorize any officer or employee to exercise any of the powers or to perform any of the functions specified in Sections 5 to 12, both inclusive, of this Article within such limits, if any, as may be set forth in the authorizing resolution.

     SECTION 14. Fidelity Bonds. Satisfactory bonds covering each officer and employee of the Corporation for the faithful discharge of their respective duties shall be carried at all times.

     SECTION 15. Required Vacations. At least once in every year of employment, each officer and employee shall be required to be absent from the Corporation for a period of not less than ten consecutive business days, provided they are entitled to at least ten days paid vacation.

ARTICLE VI
INDEMNIFICATION

     SECTION 1. Indemnification. The Corporation shall indemnify all persons made parties to any action, suit or proceeding, civil or criminal, by reason of the fact that they are or were either Directors, officers or employees of the Corporation or of any corporation, partnership, joint venture, trust or other enterprise which they served in such capacities at the request of the Corporation. Such persons shall be indemnified against judgments, fines, and other liabilities (including amounts paid in settlement) sustained as a result of, and reasonable expenses (including attorneys’ fees) incurred in connection with, the defense or the compromise or settlement of any such action, suit or proceeding, or in connection with the appeal thereof, subject to the limitations set forth in this Article.

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     SECTION 2. Limitations. An indemnification under this Article shall be limited under the following circumstances:

     (i) In the event of a final adjudication of such action, suit or proceeding, such person shall not be indemnified with respect to any matter as to which they have been adjudged liable for gross negligence or knowing and intentional misconduct in the performance of their duties to the Corporation.

     (ii) In the event that such action, suit or proceeding is compromised or settled before final adjudication thereof, such persons shall not be indemnified unless there shall be a Qualified Determination that they acted without gross negligence and that their actions did not constitute knowing and intentional misconduct in the performance of their duties to the Corporation.

     (iii) Such persons shall not be indemnified for any amounts incurred in any administrative proceeding or action instituted by an appropriate Corporation regulatory agency which resulted in a final order assessing civil money penalties or requiring affirmative action by such person or persons in the form of payments to the Corporation, or whenever such indemnification is otherwise prohibited by the general corporate laws of the State of Illinois, appropriate Corporation regulatory agency regulations, or other applicable law.

     SECTION 3. Exception. A judgment or conviction in a criminal action, suit or proceeding or termination of such proceeding by a plea of nolo contendere or its equivalent shall not be deemed an adjudication that the Director, officer, or employee is liable for gross negligence or knowing and intentional misconduct in the performance of their duties to the Corporation if there is a Qualified Determination that the action complained of on the part of the Director, officer, or employee was taken in good faith in what they considered to be in the best interests of the Corporation and on the reasonable assumption of its legality.

     SECTION 4. Expense Advances. Expenses incurred by persons who may have a right of indemnification under this Article in defending a civil or criminal action, suit or proceeding may be paid by the Corporation in advance of the final disposition of such action, suit or proceeding, if authorized in the sole discretion of the Board of Directors by a majority vote, upon receipt of a written undertaking on behalf of such persons to repay such amounts, unless it is ultimately determined that they are entitled to be indemnified by the Corporation pursuant to a Qualified Determination.

     SECTION 5. Qualified Determination Defined. As used in this Article, the words “Qualified Determination” means that the matter in question shall be determined either:

     (i) by a court order, or

     (ii) by a majority vote of the Directors who are not parties to such action, suit or proceeding, even though less than a quorum, or

     (iii) if there are no such Directors or if such disinterested Directors so direct, by independent legal counsel in a written opinion, or

     (iv) by vote of the majority of the stockholders.

     SECTION 6. Insurance. The Corporation may purchase and maintain insurance on behalf of any persons who are or were Directors, officers, or employees of the Corporation or are or were serving at the request of the Corporation as a Director, officer, or employee of another corporation, partnership, joint venture, trust or other enterprise, against any liability asserted against such persons and incurred by them in any such capacity or arising out of their status as such, whether or not the Corporation would

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have the power to indemnify them against such liability under the provisions of this Article or applicable state or federal laws.

     SECTION 7. Unimpaired Rights. The foregoing rights of indemnification shall not be exclusive of any other rights which any Director, officer, or employee may have as a matter of law. The foregoing rights of indemnification shall, in the case of the death of a Director, officer, or employee inure to the benefit of the decedent’s estate.

ARTICLE VII
CAPITAL STOCK

     SECTION 1. Certificates of Stock. The certificates of stock of the Corporation shall be numbered as they are issued, shall exhibit the owner’s name and the number of shares, and shall be signed by either the Chairman of the Board or the President or any Vice President, together with either the Secretary or an additional Vice President, and shall bear the corporate seal. Transfers of stock shall be made only on the books of the Corporation either by the holder in person or by duly authorized attorney; and the possession of a certificate of stock shall not be regarded as vesting any ownership of the same in any other than the person in whose name it is issued (as between the Corporation and such other holder) until the transfer is duly made on the books of the Corporation, as aforesaid. The Secretary, or in the Secretary’s absence any officer designated by the President, shall see that proper certificates showing the transfers of the Capital Stock of the Corporation, as they are made on the books of the Corporation, are executed and filed as required by law.

     SECTION 2. Surrender of Certificates. Books for the entry and transfer of the stock of the Corporation shall be in charge of the Secretary or any officer designated by the President and no transfer shall be made, and no certificates issued, except after the surrender and cancellation of the certificate or certificates, previously issued therefore, or proof of their loss, as provided in Section 3.

     SECTION 3. Lost Certificates. If any person requests that a certificate of stock of the Corporation be issued in place of one lost or destroyed, the person shall make an affidavit of the fact, and in it state the circumstances of the loss or destruction of said certificate, and the person shall transmit to the Corporation an affidavit, and shall give to the Corporation and to the registrar, if required by either, a satisfactory bond of indemnity, with one or more sureties, against any damage that may arise from issuing a new certificate in place of that said to have been lost or destroyed.

ARTICLE VIII
FISCAL YEAR

     SECTION 1. Fiscal Year. The fiscal year of the Corporation shall begin on the first day of November and close on the last day of October.

ARTICLE IX
APPLICABLE LAW

     SECTION 1. Effective Date. Upon adoption by the Board of Directors, these Bylaws shall supersede all prior By-laws, amendments, and resolutions relating to the matters governed by the Articles herein set forth.

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ARTICLE X
AMENDMENTS

     SECTION 1. Amendments. These By-laws may be altered, amended or repealed and new By-laws may be adopted at any regular or special meeting of the Board of Directors by the affirmative vote of a majority of the members of the Board.

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EX-4.1

EXHIBIT 4.1

AMENDED AND RESTATED TRUST AGREEMENT

among

MetroCorp, Inc.

as Depositor,

Wilmington Trust Company,

as Property Trustee,

Wilmington Trust Company,

as Delaware Trustee,

and

the Administrators named herein

Dated as of November 1, 2001

TABLE OF CONTENTS

ARTICLE I INTERPRETATION AND DEFINITIONS	1
Section 1.1. Interpretation	1
Section 1.2. Certain Definitions	2
ARTICLE II THE TRUST	11
Section 2.1. Name	11
Section 2.2. Office of the Delaware Trustee; Principal Place of Business	11
Section 2.3. Organizational Expenses	11
Section 2.4. Issuance of the Capital Securities	12
Section 2.5. Issuance of the Common Securities; Subscription and Purchase of Subordinated Notes	12
Section 2.6. Declaration of Trust	12
Section 2.7. Authorization to Enter into Certain Transactions	13
Section 2.8. Assets of Trust	16
Section 2.9. Title to Trust Property	16
ARTICLE III PAYMENT ACCOUNT	16
Section 3.1. Payment Account	16
ARTICLE IV DISTRIBUTIONS; REDEMPTION	17
Section 4.1. Distributions	17
Section 4.2. Redemption	17
Section 4.3. Distributions to and Subordination of Common Securities	19
Section 4.4. Payment Procedures	20
Section 4.5. Tax Returns and Reports	20
Section 4.6. Payment of Taxes; Duties of the Trustee	20
Section 4.7. Payments under Subordinated Loan Agreement or Guarantee Agreement or Pursuant to Direct Actions	20
Section 4.8. Liability of the Holder of Common Securities	21
ARTICLE V TRUST SECURITIES CERTIFICATES	21
Section 5.1. Initial Ownership	21
Section 5.2. The Trust Securities Certificates	21
Section 5.3. Execution and Delivery of Trust Securities Certificates	21
Section 5.4. Registration of Transfer and Exchange of Capital Securities Certificates	21
Section 5.5. Mutilated, Destroyed, Lost or Stolen Trust Securities Certificates	23
Section 5.6. Persons Deemed Holders	23
Section 5.7. Access to List of Holders= Names and Addresses	23
Section 5.8. Maintenance of Office or Agency	24
Section 5.9. Appointment of Paying Agent	24
Section 5.10. Ownership of Common Securities by Depositor	24

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Section 5.11. Rights of Holders	25
ARTICLE VI ACTS OF HOLDERS; VOTING	26
Section 6.1. Limitations on Voting Rights	26
Section 6.2. Acts of Holders	27
Section 6.3. Inspection of Records	28
ARTICLE VII REPRESENTATIONS AND WARRANTIES	28
Section 7.1. Representations and Warranties of the Property Trustee and the Delaware Trustee	28
Section 7.2. Representations and Warranties of Depositor	29
ARTICLE VIII THE TRUSTEES; THE ADMINISTRATORS	29
Section 8.1. Certain Duties and Responsibilities	29
Section 8.2. Certain Notices	31
Section 8.3. Certain Rights of Property Trustee	31
Section 8.4. Not Responsible for Recitals or Issuance of Securities	34
Section 8.5. May Hold Securities	34
Section 8.6. Compensation; Indemnity Fees	34
Section 8.7. Corporate Property Trustee Required; Eligibility of Trustees and Administrators	36
Section 8.8. Co-Trustees and Separate Trustee	36
Section 8.9. Resignation and Removal; Appointment of Successor	37
Section 8.10. Acceptance of Appointment by Successor	38
Section 8.11. Merger, Conversion, Consolidation or Succession to Business	39
Section 8.12. Preferential Collection of Claims Against Depositor or Trust	39
Section 8.13. Reports by Property Trustee	40
Section 8.14. Number of Trustees	40
Section 8.15. Delegation of Power	40
Section 8.16. Appointment of Administrators	41
ARTICLE IX TERMINATION AND MERGER	41
Section 9.1. Termination Upon Expiration Date	41
Section 9.2. Early Termination	41
Section 9.3. Termination	42
Section 9.4. Liquidation	42
Section 9.5. No Mergers, Consolidations, Amalgamations or Replacements of the Trust	43
Section 9.6. Certificate of Cancellation	43
ARTICLE X MISCELLANEOUS PROVISIONS	43
Section 10.1. Limitation of Rights of Holders	43
Section 10.2. Amendment	43
Section 10.3. Separability	44
Section 10.4. Governing Law	44

- iii -

Section 10.5. Payments Due on Non-Business Day	45
Section 10.6. Successors	45
Section 10.7. Headings	45
Section 10.8. Reports, Notices and Demands	45
Section 10.9. Agreement Not to Petition	46
Section 10.10. Acceptance of Terms of Trust Agreement, Guarantee Agreement and Subordinated Loan Agreement	46
Section 10.11. Counterparts	47
Section 10.12. Limited Liability	47

- iv -

Exhibit A — Certificate of Trust

Exhibit B — Form of Common Securities Certificate

Exhibit C — Form of Preferred Securities Certificate

Exhibit D — Form of Expense Agreement

-v-

AMENDED AND RESTATED TRUST AGREEMENT

     Amended and Restated Trust Agreement dated as of November 1, 2001 among (i) MetroCorp, Inc., a Delaware corporation (including any successors or assigns, the “Depositor”), (ii) Wilmington Trust Company, a banking corporation organized under the laws of the State of Delaware, as property trustee (in such capacity, the “Property Trustee” and, in its separate corporate capacity and not in its capacity as Property Trustee, the “Bank”), (iii) Wilmington Trust Company, a banking corporation organized under the laws of the State of Delaware, as Delaware trustee (in such capacity the “Delaware Trustee”) (the Property Trustee and the Delaware Trustee collectively, the “Trustees”), and (iv) Gary Andersen, an individual, and Julius J. Van Paemel, an individual, each of whose address is c/o MetroCorp, Inc., 1523 8^th Street, East Moline, Illinois 61244 (each, together with any successor thereto, an “Administrator” and, collectively, the “Administrators”).

     WHEREAS, the Depositor, the Trustees and the Administrators have heretofore duly declared and established a business trust pursuant to the Delaware Business Trust Act (as hereinafter defined) by entering into that certain Declaration of Trust, dated as of August 1, 2001 (the “Original Declaration”), and by the execution and filing by the Delaware Trustee with the Secretary of State of the State of Delaware of the Certificate of Trust, filed on August 8, 2001, (the “Certificate of Trust”) attached as Exhibit A; and

     WHEREAS, the Depositor and the Trustees desire to enter into this Amended and Restated Trust Agreement to amend and restate the Original Declaration in its entirety as set forth herein to provide for, among, other things, (i) the issuance of the Common Securities by the Trust to the Depositor, (ii) the issuance and sale of the Capital Securities by the Trust pursuant to the Subscription Agreement, and (iii) the acquisition by the Trust from the Depositor of all of the right, title and interest in the Subordinated Note;

     NOW, THEREFORE, in consideration of the agreements and obligations set forth herein and for other good and valuable consideration, the sufficiency of which is hereby acknowledged, each party, for the benefit of the other parties and for the benefit of the Holders (as hereinafter defined), hereby amends and restates the Original Declaration in its entirety and agrees as follows:

ARTICLE I
INTERPRETATION AND DEFINITIONS

Section 1.1. Interpretation. For all purposes of this Trust Agreement, except as otherwise expressly provided or unless the context otherwise requires:

     (a) the terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular;

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     (b) unless the context otherwise requires, any reference to an “Article” or a “Section” refers to an Article or Section, as the case may be, of this Trust Agreement;

     (c) the words “herein”, “hereof” and “hereunder” and other words of similar import refer to this Trust Agreement as a whole and not to any particular Article, Section or other subdivision; and

     (d) unless the context otherwise requires, any reference to a statute, rule or regulation refers to the same (including any successor statute, rule or regulation thereto) as it may be amended from time to time.

Section 1.2. Certain Definitions. For all purposes of this Trust Agreement, the following terms shall have the meanings assigned below:

“Act” has the meaning specified in Section 6.2.

“Administrators” has the meaning set forth in the preamble to this Trust Agreement.

“Affiliate” means, at any time, and with respect to any Person, (i) any other Person which at such time directly or indirectly through one or more intermediaries controls, or is controlled by, or is under common control with, such first Person, (ii) any Person which beneficially owns or holds, directly or indirectly, 10% or more of any class of the Voting Stock (as defined in the Subordinated Note Agreement) of the Depositor, (iii) any Person 10% or more of the Voting Stock (or in the case of a Person which is not a corporation, 10% or more of the equity interest) of which is beneficially owned or held by the Depositor or a Subsidiary (as defined in the Subordinated Note Agreement), or (iv) any person who is related by blood, adoption or marriage to any person described in clause (ii); provided, however, that the Trust shall not be deemed to be an Affiliate of the Depositor. The term “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of Voting Stock, by contract or otherwise. Unless the context otherwise clearly requires, any reference to an “Affiliate” is a reference to an Affiliate of the Depositor.

“Bank” has the meaning specified in the preamble to this Trust Agreement.

“Bankruptcy Event” means, with respect to any Person:

     (a) the entry of a decree or order by a court having jurisdiction in the premises judging such Person a bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjudication or composition of or in respect of such Person under any applicable Federal or State bankruptcy, insolvency, reorganization or other similar law, or appointing a receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of such Person or of all or any substantial part of its property or ordering the winding up or liquidation of its affairs, and (in the case of any of the foregoing other than a

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decree or order relating to the appointment of a receiver for a Significant Bank Subsidiary) the continuance of any such decree or order unstayed and in effect for a period of 60 consecutive days; or

     (b) the institution by such Person of proceedings to be adjudicated a bankrupt or insolvent, or the consent by it to the institution of bankruptcy or insolvency proceedings against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable Federal or State bankruptcy, insolvency, reorganization or other similar law, or the consent by it to the filing of any such petition or to the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or similar official) of such Person or of any substantial part of its property, or the making by it of an assignment for the benefit of creditors, or the admission by it in writing of its inability to pay its debts generally as they become due and its willingness to be adjudicated a bankrupt, or the taking of corporate action by such Person in furtherance of any such action.

“Bankruptcy Laws” has the meaning specified in Section 10.9.

“Board Resolution” means a copy of a resolution certified by the Secretary or an Assistant Secretary of the Depositor to have been duly adopted by the Depositor’s board of directors, or such committee of such board of directors to which authority to act on behalf of such board of directors has been delegated, and to be in full force and effect on the date of such certification, and delivered to the Trustees.

“Business Day” means a day other than (a) a Saturday or Sunday, (b) a day on which banking institutions in The City of New York or East Moline, Illinois are authorized or required by law or executive order to remain closed, or (c) a day on which the Property Trustee’s Corporate Trust Office is closed for business.

“Capital Securities Certificate” means a certificate evidencing Capital Securities, substantially in the form attached as Exhibit C.

“Capital Security” means a Floating Rate Cumulative Capital Security (Initial Liquidation Preference $1,000 per Capital Security) of the Trust, constituting a preferred undivided beneficial interest in the assets of the Trust and having the rights provided therefor in this Trust Agreement, including the right to receive Distributions, Redemption Amounts and a liquidation distribution as provided herein.

“Certificate of Trust” has the meaning specified in the preamble to this Trust Agreement.

“Closing Date” means the date upon which the Closing, as such term is defined in the Subscription Agreement, occurs, which date is also the date of the initial issuance, sale and delivery of the Trust Securities and the Subordinated Note.

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“Common Securities Certificate” means a certificate evidencing the Common Securities, substantially in the form attached as Exhibit B.

“Common Security” means a Common Security (Initial Liquidation Amount $309,278 in the aggregate for all Common Securities) of the Trust, constituting a beneficial interest in the assets of the Trust, subject to the preferences of the Capital Securities, and having the rights provided therefor in this Trust Agreement, including the right to receive Distributions, Redemption Amounts and a liquidation distribution as provided herein.

“Corporate Trust Office” means the principal corporate trust office of the Property Trustee, which on the date hereof is located at Rodney Square North, 1100 North Market Street, Wilmington, Delaware 19890-0001, Attention: Corporate Trust Administration – MetroCorp Capital Trust I.

“Default” has the meaning specified in the Subordinated Loan Agreement.

“Delaware Business Trust Act” means Chapter 38 of Title 12 of the Delaware Code, 12 Del. Code '3801 et seq., as it may be amended from time to time.

“Delaware Trustee” means the Person identified as the ADelaware Trustee” in the preamble to this Trust Agreement, solely in its capacity as Delaware Trustee of the Trust and not in its individual capacity, or its successor in interest in such capacity, or any successor trustee appointed as herein provided.

“Depositor” has the meaning specified in the preamble to this Trust Agreement.

“Direct Action” has the meaning specified in Section 5.11(c).

“Distribution Date” has the meaning specified in Section 4.1(a).

“Distributions” means amounts payable in respect of Trust Securities as provided in Section 4.1.

“Early Termination Event” has the meaning specified in Section 9.2.

“Event of Default” means any one of the following events (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body):

     (a) the occurrence of a Subordinated Note Event of Default; or

     (b) default by the Trust in the payment of any Distribution when it becomes due and payable after the corresponding payment has been made to the Trust on the Subordinated Note; or

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     (c) default by the Trust in the payment of any Redemption Amount of any Trust Security when it becomes due and payable after the corresponding payment has been made to the Trust on the Subordinated Note; or

     (d) default in the performance or breach of any covenant or warranty of the Trust in the Subscription Agreement and continuation of any such default or breach for a period of 30 days after the earlier of (i) a Responsible Officer of the defaulting Trustee obtaining actual knowledge of such default, and (ii) there having been given, in the manner provided in Section 10.8, to the defaulting Trustee or Trustees by any Holder a written notice specifying such default or breach and requiring it to be remedied and stating that such notice is a “Notice of Default” hereunder; or

     (e) the occurrence of a Bankruptcy Event with respect to the Property Trustee and a successor Property Trustee has not been appointed within 90 days thereof.

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.

“Exchange Notes” has the meaning specified in Section 9.2(b).

“Expense Agreement” means the Agreement as to Expenses and Liabilities between the Depositor and the Trust, substantially in the form attached as Exhibit D, as amended from time to time.

“Expiration Date” has the meaning specified in Section 9.1.

“Guarantee Agreement” means the Guarantee Agreement dated as of even date herewith executed and delivered by the Depositor contemporaneously with the execution and delivery of this Trust Agreement, for the benefit of the holders of the Capital Securities, as amended from time to time.

“Holder” means a Person in whose name a Trust Security or Trust Securities are registered in the Securities Register, such Person being a beneficial owner within the meaning of the Delaware Business Trust Act.

“Initial Liquidation Amount” means the aggregate original Liquidation Amount of the Common Securities on the date of this Trust Agreement, which is $309,278.

“Initial Liquidation Preference” means the original Liquidation Preference of each Capital Security on the date of this Trust Agreement, which is $1,000 per Capital Security.

“Institutional Investor” means (a) any original Purchaser of a Capital Security, (b) any holder of a Capital Security holding more than 2% of the aggregate Liquidation Preference of the Capital Securities, and (c) any bank, trust company, savings and loan association or other financial institution, any pension plan, any trust fund, any investment fund, any investment company, any

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insurance company, any broker or dealer, or any other similar financial institution or entity, regardless of legal form.

“Lien” means any lien, pledge, charge, encumbrance, mortgage, deed of trust, adverse ownership interest, hypothecation, assignment, security interest or preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever.

“Like Amount” means (a) with respect to a redemption of Trust Securities, Trust Securities having a Liquidation Preference or Liquidation Amount, as the case may be, equal to the principal amount of the portion of the Subordinated Note to be contemporaneously repaid in accordance with the Subordinated Loan Agreement, the proceeds of which will be used to pay the Redemption Amount of such Trust Securities, and (b) with respect to the distribution of an Exchange Note pursuant to Section 9.2(b) upon the occurrence of an Early Termination Event, the portion of the Subordinated Note (and therefore the principal amount of such Exchange Note) equal to the Liquidation Preference of the Capital Security exchanged for such Exchange Note.

“Liquidation Amount” means the amount of the Common Securities which shall be distributed in respect thereto, following the making of preferential Distributions with respect to the Capital Securities, in the event of the liquidation of the Trust; the Liquidation Amount shall be in an original amount of $309,278 for the Common Securities in the aggregate and shall be reduced effective upon each Unscheduled Redemption by the Redemption Amount distributed in each such event in respect of the Common Securities.

“Liquidation Date” means the date on which Exchange Notes are to be distributed to Holders of Capital Securities in connection with a termination and liquidation of the Trust pursuant to Section 9.2.

“Liquidation Preference” means the amount of each Capital Security which shall be distributed in respect thereto in preference to and prior to any distribution to the Common Securities in the event of the liquidation of the Trust; the Liquidation Preference shall be in an original amount of $100,000 per Capital Security and shall be reduced effective upon each Unscheduled Redemption by the Redemption Amount distributed in each such event in respect of each Capital Security.

“Loan” has the meaning specified in the Subordinated Loan Agreement.

“1940 Act” means the Investment Company Act of 1940, as amended.

“Officers Certificate” means a certificate signed by the Chairman and Chief Executive Officer, President or a Vice President, and by the Treasurer, an Associate Treasurer, an Assistant Treasurer, the Controller, the Secretary or an Assistant Secretary, of the Depositor, and delivered to the appropriate Trustee. Any Officers’ Certificate delivered with respect to compliance with a covenant or condition provided for in this Trust Agreement shall include:

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     (a) a statement that each officer signing the Officers’ Certificate has read the covenant or condition and the definitions relating thereto;

     (b) a brief statement of the nature and scope of the examination or investigation undertaken by each officer in rendering the Officers’ Certificate;

     (c) a statement that each such officer has made such examination or investigation as, in such officer’s opinion, is necessary to enable such officer to express an informed opinion as to whether or not such covenant or condition has been complied with; and

     (d) a statement as to whether, in the opinion of each such officer, such condition or covenant has been complied with.

“Opinion of Counsel” means a written opinion of counsel, who may be counsel for the Trust, the Property Trustee or the Depositor, and who shall be reasonably acceptable to the Property Trustee.

“Original Declaration” has the meaning specified in the preamble to this Trust Agreement.

“Past Due Distribution Rate” has the meaning specified in Section 4.1.

“Paying Agent” has the meaning specified in Section 5.9.

“Payment Account” means a segregated non-interest-bearing corporate trust account maintained by the Property Trustee with the Bank in its trust department for the benefit of the Holders in which all amounts paid in respect of the Subordinated Note will be held and from which the Property Trustee, as Paying Agent, shall make payments to the Holders in accordance with Sections 4.1 and 4.2.

“Person” means any individual, corporation, partnership, joint venture, trust, limited liability company or corporation, unincorporated organization or government or any agency or political subdivision thereof.

“Property Trustee” means the Person identified as the “Property Trustee” in the preamble to this Trust Agreement, solely in its capacity as Property Trustee of the Trust and not in its individual capacity, or its successor in interest in such capacity, or any successor property trustee appointed as herein provided.

“Subscription Agreement” means the Subscription Agreement dated as of even date herewith, among the Trust, the Depositor and the Purchasers.

“Purchasers” shall mean the person or persons listed on the execution page to the Subscription Agreement duly accepted and counter-executed by the Depositor.

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“Redemption Amount” means, with respect to any Trust Security, the portion of the Liquidation Preference or Liquidation Amount, as the case may be, thereof that shall be called for redemption in the case of an Unscheduled Redemption.

“Redemption Date” means, with respect to any Trust Security to be redeemed, the date fixed for redemption thereof, which shall be for each Unscheduled Redemption the date notified therefor as provided in Section 4.2(b).

“Relevant Trustee” has the meaning specified in Section 8.9.

“Responsible Officer” means, when used with respect to either Trustee, any officer in the Corporate Trust Administration Department of such Trustee with direct responsibility for the administration of this Trust Agreement and also means, with respect to a particular corporate trust matter, any other officer of such Trustee to whom such matter is referred because of such officer’s knowledge of and familiarity with the particular subject.

“Restricted Legend” means a legend to be imprinted on each Capital Security as set forth on the form of Capital Security attached hereto as Exhibit C.

“Securities Act” means the United States Securities Act of 1933, as amended.

“Securities Register” and “Securities Registrar” have the respective meanings specified in Section 5.4.

“Settlement Date” means, with respect to the Redemption Amount of any Capital Security, the date prior to the scheduled maturity thereof on which such Capital Security is to be redeemed pursuant to Section 4.2(b).

“Significant Bank Subsidiary” means, at any time, any Subsidiary that is a national bank or a state bank and that, during any of the three fiscal years then most recently ended, shall have contributed more than 10% of the consolidated net income of the Depositor and its Subsidiaries (as determined in accordance with generally accepted accounting principles).

“Special Event” shall have the meaning specified in the Subordinated Loan Agreement.

“Subordinated Loan Agreement” means the Subordinated Loan Agreement dated as of even date herewith between the Depositor and the Trust.

“Subordinated Note” means the Depositor’s Floating Rate Subordinated Note due November 1, 2031 issued pursuant to the Subordinated Loan Agreement in the original principal amount of $10,309,278.

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“Subordinated Note Event of Default” means an AEvent of Default” as defined in the Subordinated Loan Agreement.

“Subordinated Note Repayment Date” means, with respect to any repayment of the Subordinated Note under the Subordinated Loan Agreement, the date fixed for repayment under the Subordinated Loan Agreement.

“Suspension Event” has the meaning specified in the Subordinated Loan Agreement.

“Trust” means the Delaware business trust identified in Section 2.1.

“Trust Agreement” means this Amended and Restated Trust Agreement, as the same may be modified, amended or supplemented, from time to time, in accordance with the applicable provisions hereof.

“Trust Property” means, at any time, (i) the Subordinated Note and rights of the holder of the Subordinated Note under the Subordinated Loan Agreement, (ii) the rights of the Trust under the Expense Agreement, (iii) any cash on deposit in, or owing to, the Payment Account and (iv) all proceeds and rights in respect of the foregoing and any other property and assets at such time being held or deemed to be held by the Property Trustee pursuant to the terms of this Trust Agreement.

“Trust Securities Certificate” means any one of the Common Securities Certificates or the Capital Securities Certificates.

“Trust Security” means the Common Securities or the Capital Securities or both or any portion of either class, as relevant in the context in which the term is used.

“Trustees” means, collectively, the Property Trustee and the Delaware Trustee.

“Unscheduled Redemption” has the meaning set forth in Section 4.2.

“Unscheduled Redemption Date” means each date specified in a notice provided for in and as defined in Section 4.2(c).

ARTICLE II
THE TRUST

Section 2.1. Name. The Trust continued pursuant hereto shall be known as “MetroCorp Capital Trust I”, in which name the Property Trustee or the Administrators, as the case may be, may conduct the business of the Trust, make and execute contracts and other instruments on behalf of the Trust and sue and be sued, and the Trust shall be a statutory business trust for the purposes permitted and with all legal rights granted under the laws of the State of Delaware.

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Section 2.2. Office of the Delaware Trustee; Principal Place of Business. The address of the Delaware Trustee in the State of Delaware is Rodney Square North, 1100 North Market Street, Wilmington, Delaware 19890-0001, Attention: Corporate Trust Administration-MetroCorp Capital Trust I, or such other address in the State of Delaware as the Delaware Trustee may designate by written notice to the Holders and the Depositor. The principal executive office of the Trust is in care of MetroCorp, Inc., 1523 8^th Street, East Moline, Illinois 61244 1601, Attention: General Counsel.

Section 2.3. Organizational Expenses. The Depositor shall pay organizational and administrative expenses of the Trust as they arise or shall, upon request of any Trustee, promptly reimburse such Trustee, at cost, for any such expenses paid by such Trustee. The Depositor shall make no claim upon the Trust Property for the payment or reimbursement of such expenses.

Section 2.4. Issuance of the Capital Securities. Contemporaneously with the execution and delivery of this Trust Agreement, the Depositor and an Administrator, on behalf of the Trust, shall execute and deliver the Subscription Agreement. Contemporaneously with the execution and delivery of this Trust Agreement and the Subscription Agreement, an Administrator, on behalf of the Trust, shall execute in accordance with Section 5.2 and deliver to the Purchasers, Capital Securities Certificates representing all Capital Securities, collectively, having an aggregate Initial Liquidation Preference of $10,000,000, against receipt of the aggregate purchase price of such Capital Securities of $10,000,000 by the Trust.

Section 2.5. Issuance of the Common Securities; Subscription and Purchase of Subordinated Notes. Contemporaneously with the execution and delivery of this Trust Agreement, an Administrator, on behalf of the Trust, shall execute in accordance with Section 5.2 and deliver to the Depositor, the Common Securities Certificate, registered in the name of the Depositor, representing the Common Securities and having an aggregate Liquidation Amount of $309,278 against payment by the Depositor of $309,278 to the Trust. The Administrators, on behalf of the Trust, shall thereupon advance the aggregate purchase price of the Common Securities and the Capital Securities, in the principal amount of $10,309,278 to the Depositor, subject to fulfillment of conditions precedent under the Subordinated Loan Agreement, and in exchange for an executed Subordinated Note in such principal amount issued by the Depositor to the Trust.

Section 2.6. Declaration of Trust. The sole and exclusive purpose and function of the Trust is (i) to issue and sell the Trust Securities as provided in Sections 2.4 and 2.5; (ii) to advance the purchase price from the issuance of the Trust Securities as proceeds of a loan under the Subordinated Loan Agreement evidenced by the Subordinated Note; (iii) to distribute the income of the Trust as provided in this Trust Agreement; and (iv) to engage in those activities necessary, convenient or incidental to the foregoing. The Trust shall not have the authority to issue additional Common Securities or additional Capital Securities. The Depositor hereby appoints the Trustees as trustees of the Trust, to have all the rights, powers and duties set forth herein, and the Trustees hereby accept such appointment. The Property Trustee hereby declares that it will hold the Trust Property in trust upon and subject to the conditions set forth herein for the benefit of the Trust and the Holders. The Administrators shall have all rights, powers and duties set forth herein with respect to accomplishing

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the purposes of the Trust and shall not be trustees or fiduciaries with respect to the Trust. The Property Trustee shall have the power (but shall have no duty) to perform those duties assigned to the Administrators. The Delaware Trustee shall not be entitled to exercise any powers, nor shall the Delaware Trustee have any of the duties and responsibilities, of the Property Trustee or the Administrators set forth herein. The Delaware Trustee shall be one of the Trustees of the Trust for the sole and limited purpose of fulfilling the requirements of Section 3807 of the Delaware Business Trust Act.

Section 2.7. Authorization to Enter into Certain Transactions. (a) The Trustees and the Administrators shall conduct the affairs of the Trust in accordance with the terms of this Trust Agreement. Subject to the limitations set forth in Section 2.7(b), and in accordance with the following clauses (i) and (ii), the Property Trustee and the Administrators shall have the authority and are hereby specifically authorized and directed to cause the Trust to enter into all transactions and execute, deliver and perform agreements determined by the Property Trustee or the Administrators to be appropriate under this Trust Agreement, and to perform all acts in furtherance thereof, including without limitation the following:

     (i) Notwithstanding any provision in this Trust Agreement to the contrary, each Administrator shall have the power and authority and is hereby authorized and directed to act on behalf of the Trust with respect to the following matters:

     (A) to execute, deliver, issue and sell the Trust Securities and to acquire the Subordinated Note with the proceeds of such sale; provided, however, that the Administrators shall cause legal title to the Subordinated Note to be held of record in the name of the Property Trustee for the benefit of the Holders;

     (B) to cause the Trust to enter into, and to execute, deliver and perform on behalf of the Trust, the Expense Agreement, the Subscription Agreement, the Subordinated Loan Agreement, and each other agreement and instrument (including, without limitation, such certificates, cross-receipts and other papers as may be necessary in connection with the issuance and sale of the Trust Securities and the purchase of the Subordinated Note) as such Administrator deems necessary, incidental or desirable in connection with the purposes and function of the Trust;

     (C) to send notices (other than notices of default) and other information regarding the Trust Securities and the Subordinated Notes to the Holders in accordance with this Trust Agreement;

     (D) to consent to the appointment of a Paying Agent and Securities Registrar in accordance with this Trust Agreement, which consent shall not be unreasonably withheld;

     (E) to remove a Paying Agent and to appoint a successor Paying Agent in accordance with this Trust Agreement;

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     (F) to the extent provided in this Trust Agreement, to wind up the affairs of and liquidate the Trust;

     (G) unless otherwise determined in accordance with the provisions of this Agreement or the Subordinated Loan Agreement by the Property Trustee or the Holders of at least a majority of the sum of the Liquidation Preference of the Capital Securities then outstanding and the Liquidation Amount of the Common Securities then outstanding, or as otherwise required by the Delaware Business Trust Act, to execute on behalf of the Trust (either acting alone or together with any or all of the other Administrators) any documents that the Administrators have the power to execute pursuant to this Trust Agreement; and

     (H) to take any action incidental or convenient to the foregoing as such Administrator may from time to time determine is necessary or advisable to give effect to the terms of this Trust Agreement for the benefit of the Holders (without consideration of the effect of any such action on any particular Holder).

     (ii) As among the Trustees, the Property Trustee shall have the power and authority and is hereby authorized and directed to act on behalf of the Trust with respect to the following matters:

     (A) to act as Paying Agent and/or Securities Registrar to the extent appointed as such hereunder;

     (B) to establish the Payment Account;

     (C) to collect in the Payment Account interest, principal and any other payments made to the Property Trustee in respect of the Subordinated Note;

     (D) to distribute from the Trust Property amounts owed to the Holders in respect of the Trust Securities pursuant to this Trust Agreement;

     (E) to receive and take title to the Subordinated Note and to exercise all of the rights, powers and privileges of the holder of the Subordinated Note;

     (F) to send notices of default and other information regarding the Trust Securities and the Subordinated Note to the Holders in accordance with this Trust Agreement;

     (G) to distribute the Trust Property in accordance with the terms of this Trust Agreement;

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     (H) to the extent provided in this Trust Agreement, to wind up of the affairs of and liquidate the Trust and to prepare, execute and file the certificate of cancellation with the Secretary of State of the State of Delaware;

     (I) to take any action incidental or convenient to the foregoing (including executing any certificate or acknowledgment of the Property Trustee’s receipt of the Subordinated Note) as the Property Trustee may from time to time determine is necessary or advisable to give effect to the terms of this Trust Agreement and to protect and conserve the Trust Property for the benefit of the Holders (without consideration of the effect of any such action on any particular Holder); and

     (J) subject to the provisions of this Section 2.7(a)(ii), the Property Trustee shall have none of the duties, liabilities, powers or the authority of the Administrators set forth in this Trust Agreement.

     In the event of a conflict between the action of the Administrators and the action of the Property Trustee, the action of the Property Trustee shall prevail.

     (b) So long as this Trust Agreement remains in effect, the Trust (or the Trustees or Administrators acting on behalf of the Trust) shall not undertake any business, activities or transaction except as expressly provided herein or contemplated hereby. In particular, neither the Trustees nor the Administrators shall (i) acquire any investments or engage in any activities not authorized by this Trust Agreement, (ii) issue any securities other than the Trust Securities the issuance of which is provided for in this Trust Agreement, (iii) sell, assign, transfer, exchange, mortgage, pledge, set-off or otherwise dispose of any of the Trust Property or interests therein, including to Holders, except as expressly provided herein, (iv) take any action that, to such Trustee’s or Administrator’s actual knowledge, would cause the Trust to be classified as an association taxable as a corporation for United States federal income tax purposes, (v) incur any indebtedness for borrowed money or issue any other debt or (vi) take or consent to any action that would result in the placement of a Lien on any of the Trust Property. The Administrators and the Property Trustee shall defend the Trust Property against all claims and demands of all Persons at any time claiming any Lien on any of the Trust Property adverse to the interest of the Trust or the Holders in their capacity as Holders.

     (c) In connection with the issue and sale of the Capital Securities, the Depositor shall have the right and responsibility to assist the Trust with respect to, or effect on behalf of the Trust, the following (and any actions taken by the Depositor in furtherance of the following prior to the date of this Trust Agreement are hereby ratified and confirmed in all respects):

     (i) the preparation by the Trust of any private offering documents, including any amendment or supplement thereto, in relation to the Capital Securities and the taking of any action necessary to obtain an exemption from the Securities Act;

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     (ii) the determination of the States in which to take appropriate action to qualify or register for sale all, or part, of the Capital Securities and the determination of any and all such acts, other than actions which must be taken by or on behalf of the Trust, and the advice to the Trustees of actions they must take on behalf of the Trust, and the preparation for execution and filing of any documents to be executed and filed by the Trust or on behalf of the Trust, as the Depositor deems necessary or advisable in order to comply with the applicable laws of any such States;

     (iii) the negotiation of the terms of, and the execution and delivery of, the Subscription Agreement providing for the sale of the Capital Securities; and

     (iv) the taking of any other actions necessary, incidental or desirable to carry out any of the foregoing activities.

     (d) Notwithstanding anything herein to the contrary, the Administrators are authorized and directed to conduct the affairs of the Trust and to operate the Trust so that the Trust will not be deemed to be an Ainvestment company@ required to be registered under the 1940 Act, or to be classified as an association taxable as a corporation for United States federal income tax purposes, and so that the Subordinated Note will be treated as indebtedness of the Depositor for United States federal income tax purposes. In this connection, the Administrators and the Depositor are authorized to take any action, not inconsistent with applicable law, the Certificate of Trust or this Trust Agreement, that each of any Administrator and the Depositor determines in its discretion to be necessary or desirable for such purposes, as long as such action does not adversely affect the interests of the Holders of the Capital Securities or vary the terms of the Capital Securities or the Subordinated Note.

Section 2.8. Assets of Trust. The assets of the Trust shall consist of the Trust Property.

Section 2.9. Title to Trust Property. Legal title to all Trust Property shall be vested at all times in the Property Trustee (in its capacity as such) and shall be held and administered by the Property Trustee for the benefit of the Trust and the Holders in accordance with this Trust Agreement.

ARTICLE III
PAYMENT ACCOUNT

Section 3.1. Payment Account. (a) On or prior to the Closing Date, the Property Trustee shall establish the Payment Account. The Property Trustee and any agent of the Property Trustee shall have exclusive control and sole right of withdrawal with respect to the Payment Account for the purpose of making deposits in and withdrawals from the Payment Account in accordance with this Trust Agreement. All monies and other property deposited or held from time to time in the Payment Account shall be held by the Property Trustee in the Payment Account for the exclusive benefit of the Holders and for distribution as herein provided, including (and subject to) any priority of payments provided for herein.

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     (b) The Property Trustee shall deposit in the Payment Account, promptly upon receipt, all payments of principal of or interest on, or any other payments, in respect of the Subordinated Note.

     (c) Amounts held in the Payment Account shall not be invested by the Property Trustee pending distribution thereof.

ARTICLE IV
DISTRIBUTIONS; REDEMPTION

Section 4.1. Distributions. (a) The Trust Securities represent undivided beneficial interests in the Trust Property, and Distributions will be made on the Trust Securities as provided herein on the dates that payments of interest are made on the Subordinated Note. Accordingly:

     (i) Distributions on the Trust Securities shall be cumulative, and will accumulate whether or not there are funds of the Trust available for the payment of Distributions. Distributions shall accrue from the Closing Date, and, except to the extent that the Depositor exercises its right to defer the payment of interest on the Subordinated Note in accordance with Section 3.02 of the Subordinated Loan Agreement, shall be payable quarterly in arrears on March 31, June 30, September 30 and December 31, of each year, commencing on December 31, 2001. If any date on which a Distribution otherwise would be payable on the Trust Securities is not a Business Day, then the payment of such Distribution shall be made on the next succeeding day that is a Business Day (and without any interest or other payment in respect of any such delay), or, if such Business Day falls in the next calendar year, on the immediately preceding Business Day, in each case with the same force and effect as if made on such date (each date on which Distributions are payable in accordance with this Section 4.1(a), a “Distribution Date”).

     (ii) Distributions on the Trust Securities shall accrue and accumulate until paid at the prime rate of interest as last reported in the “Money Rate” section of the Wall Street Journal adjusted on the first Business Day of each month, plus seventy-five (75) basis points (the “Scheduled Rate”) from the date it is made until maturity (the “Scheduled Distribution Rate”). The Distributions payable for any full period shall be computed on the basis of a 360-day year of twelve 30-day months. The Distributions for any partial period shall be computed on the basis of the number of days elapsed in a 360-day year of twelve 30-day months.

     (iii) Distributions on the Trust Securities shall be made by the Property Trustee from the Payment Account and shall be payable on each Distribution Date only to the extent that the Trust has funds actually received by the Property Trustee and then on hand and available in the Payment Account for the payment of such Distributions.

     (b) Distributions on the Trust Securities with respect to a Distribution Date shall be payable to the Holders thereof as they appear on the Securities Register for the Trust Securities on

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the relevant record date for such Distribution Date, which shall be the date five days prior to such Distribution Date.

Section 4.2. Redemption. (a) Unscheduled Redemptions, Including Upon Acceleration of the Loan. The Loan may be prepaid in whole or in part on dates and subject to the terms and conditions specified in the Subordinated Loan Agreement; provided that if during the 90-Day Period (as defined in the Subordinated Loan Agreement) there is available to the Trust (alone or in conjunction with the Company) the opportunity to eliminate, within the 90-Day Period, the Special Event that has given rise to the right of the Company to prepay the Loan pursuant to Section 2.02 of the Subordinated Loan Agreement by the Trust’s taking some Ministerial Action (as defined in the Subordinated Loan Agreement), the Trust shall pursue such Ministerial Action in lieu of the Unscheduled Redemption. Subject to the provisions of the final paragraph of Section 4.2(c) and to Section 4.3, in the event of a prepayment of the Loan (including any payments made as a result of acceleration of the Loan), the Trust shall redeem the Trust Securities in an amount corresponding to the Like Amount of the prepayment on the Loan (an “Unscheduled Redemption”), and any such Unscheduled Redemption shall be made on the date of the prepayment of the Loan (including the payment made by the Depositor as a result of acceleration of the Loan) together with accumulated and unpaid Distributions payable on such date to the Trust Securities. Each Unscheduled Redemption, with respect to each Trust Security so redeemed, shall reduce the Liquidation Preference or the Liquidation Amount, as the case may be, of such Trust Security by the Redemption Amount paid to the Holder thereof.

     (b) Redemption Procedures. Notice of any Unscheduled Redemption (which notice will be irrevocable) other than an Unscheduled Redemption that results from acceleration of the Loan (in which event the Property Trustee, upon a Responsible Officer of the Property Trustee obtaining actual knowledge thereof, will give prompt notice to each record Holder of Trust Securities) shall be prepared by the Administrators and will be given by the Trust to each record Holder of Trust Securities not less than 30 days and not more than 60 days prior to the date fixed for such Unscheduled Redemption which notice shall specify such date (the “Unscheduled Redemption Date”), the applicable Redemption Amount and accumulated and unpaid Distributions, each as payable to said Holder on said Unscheduled Redemption Date and shall provide a reasonably detailed computation of such amounts. If the Trust gives a notice of redemption, then the applicable Redemption Amount in such notice will become due and payable on such Unscheduled Redemption Date and by 1:00 p.m., New York City time on the date fixed for redemption, the Trust will redeem the Trust Securities at the Redemption Amount. In the event that payment of the Redemption Amount is improperly withheld or refused and not paid by either the Trust or the Depositor pursuant to the Guarantee Agreement, Distributions on the Trust Securities, called for redemption will continue to accumulate at the Past Due Distribution Rate until the date that the Redemption Amount (adjusted for additional Distributions accrued until the date of actual payment) is actually paid, and the Holders of Capital Securities may, until such payment, exercise all of their rights as Holders of the Capital Securities.

     (c) Other Redemption Matters. In the event of any partial redemption of the Capital Securities pursuant to Section 4.2(a), the amount to be so applied to the redemption of the Capital

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Securities will be allocated among all outstanding Capital Securities, as nearly as practicable in proportion to the respective Liquidation Preferences thereof (with adjustments to equalize for any prior redemption not in such proportion).

     The Trust will redeem Trust Securities on any Unscheduled Redemption Date only to the extent it has funds then on hand and available therefor in the Payment Account.

     The Depositor will promptly cancel all Capital Securities acquired by it or any Affiliate pursuant to any payment, prepayment or purchase of the Capital Securities pursuant to any provision of this Agreement, or otherwise, and no Capital Securities may be issued in substitution or exchange for any such Capital Securities.

     Notwithstanding anything to the contrary herein, no Common Securities shall be redeemed or purchased by the Trust until all Capital Securities shall have been redeemed or purchased by the Trust in full in accordance with Section 4.2(a), and no amounts received following an acceleration of the Subordinated Note shall be distributed to the Holder of the Common Securities until all amounts owing on the Capital Securities, including the Liquidation Preference and all accrued Distributions are paid in full.

Section 4.3. Distributions to and Subordination of Common Securities. (a) The Trust shall not make any Distribution to, or Unscheduled Redemption of, Common Securities on any date other than a date on which it is making a Distribution to, or Unscheduled Redemption of, Capital Securities. On any date for payment of Distributions to or for any Unscheduled Redemption of Capital Securities, the Trust shall make the payment of the Distribution and Redemption Amount to the Holders of Capital Securities prior to making any payment in respect of the Common Securities. If there is any excess monies in the Trust, so long as no Default, Event of Default or Suspension Event of which a Responsible Officer of the Trustee has actual knowledge, has occurred and is continuing, Common Securities shall be paid such excess on the date Distributions are made to the Capital Securities. After payment in full of all Distributions and the aggregate Liquidation Preference has been made in respect of the Capital Securities, any balance remaining in the Payment Account shall be distributed by the Trust to the Depositor as the Holder of Common Securities either by way of Distribution or redemption of Common Securities as the Trust shall declare. If, at any time, a Responsible Officer of the Property Trustee has actual knowledge that a Default, Event of Default or Suspension Event shall have occurred and be continuing, no payment of any kind shall be made in respect of the Common Securities, and no other payment on account of the redemption, liquidation or other acquisition, of Common Securities, shall be made unless payment in full in cash of all amounts with respect to the Capital Securities has been made or provided for including, without limitation, all accumulated and unpaid Distributions on all outstanding Capital Securities for all Distribution periods terminating on or prior thereto, and in the case of payment of the Redemption Amount the full amount of such Redemption Amount on all outstanding Capital Securities together with all accrued Distributions. At all times and for all distributions and payments on Trust Securities, all funds available to the Property Trustee shall first be applied to the payment in full of all Distributions on, or the Redemption Amount of, Capital Securities before any payment on the Common Securities.

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     (b) If an Event of Default resulting from any Subordinated Note Event of Default shall occur and be continuing, the Holder of Common Securities will be deemed to have waived any right to act with respect to any such Event of Default under this Trust Agreement until the effects of all such Events of Default with respect to the Capital Securities have been cured, waived or otherwise eliminated. If a Responsible Officer of the Property Trustee has obtained actual knowledge that any such Event of Default under this Trust Agreement has occurred, then until the Property Trustee has received written notice from the Holders of not less than 51% of the Liquidation Preference of the Capital Securities at the time outstanding that the effects of such Event of Default with respect to the Capital Securities have been so cured, waived or otherwise eliminated, the Property Trustee shall act solely on behalf of the Holders of the Capital Securities and not on behalf of the Holder of the Common Securities, and only the Holders of the Capital Securities will have the right to direct the Property Trustee to act on their behalf.

Section 4.4. Payment Procedures. Payments of Distributions (including interest accrued at the Past Due Distribution Rate on any past due Redemption Amount or Distributions, if applicable) and Redemption Amounts in respect of the Capital Securities shall be made by check mailed to the address of the Person entitled thereto as such address shall appear on the Securities Register on the relevant Distribution Dates. Payments in respect of the Common Securities shall be made in such manner as shall be mutually agreed between the Property Trustee and the Holder of the Common Securities.

Section 4.5. Tax Returns and Reports. The Administrators shall prepare (or cause to be prepared), at the Depositor=s expense, and file all United States federal, state and local tax returns and reports required to be filed by or in respect of the Trust. In this regard, the Administrators shall prepare and file (or cause to be prepared and filed) the appropriate Internal Revenue Service form required to be filed in respect of the Trust in each taxable year of the Trust and shall prepare and furnish (or cause to be prepared and furnished) to each Holder a Form 1099 or the appropriate Internal Revenue Service form required to be furnished to such Holder or the information required to be provided on such form. The Administrators shall provide the Depositor and the Property Trustee with a copy of all such returns, reports and information promptly after such filing or furnishing. The Administrators and the Property Trustee shall comply with United States federal withholding and backup withholding tax laws and information reporting requirements with respect to any payments to Holders under the Trust Securities.

Section 4.6. Payment of Taxes; Duties of the Trustee. The Property Trustee, upon receipt of written notice and direction from the Depositor or the Administrators, and only to the extent the Property Trustee actually has received and holds amounts legally available therefor, shall promptly cause any taxes, duties or governmental charges of whatsoever nature (other than withholding taxes) imposed on the Trust by the United States or any other taxing authority to be paid. The Depositor agrees to pay all such amounts so that the Trust Property will not be used or diminished by such tax payments.

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Section 4.7. Payments under Subordinated Loan Agreement or Guarantee Agreement or Pursuant to Direct Actions. Any amount payable hereunder to any Holder of Capital Securities shall be reduced by the amount of any corresponding payment such Holder has directly received pursuant to Section 8.01 of the Subordinated Loan Agreement or pursuant to the Guarantee Agreement or pursuant to Section 5.11 of this Trust Agreement.

Section 4.8. Liability of the Holder of Common Securities. The Holder of the Common Securities shall be liable for the debts and obligations of the Trust as set forth in the Expense Agreement.

ARTICLE V
TRUST SECURITIES CERTIFICATES

Section 5.1. Initial Ownership. From the formation of the Trust and the contribution by the Depositor pursuant to the Original Declaration and until the issuance of the Trust Securities the Depositor has been, and at any time during which no Trust Securities are outstanding the Depositor shall be, the holder of the sole beneficial interest in the Trust.

Section 5.2. The Trust Securities Certificates. The Capital Securities Certificates shall be issued in minimum denominations of $1,000 Initial Liquidation Preference and integral multiples thereof, and the Common Securities Certificate shall be issued in the initial denomination of $309,278 Initial Liquidation Amount. The Trust Securities Certificates shall be executed on behalf of the Trust by manual or facsimile signature of at least one Administrator. Trust Securities Certificates bearing the manual or facsimile signatures of individuals who were, at the time when such signatures shall have been affixed, authorized to sign on behalf of the Trust, shall be validly issued and entitled to the benefits of this Trust Agreement, notwithstanding that such individuals or any of them shall have ceased to be so authorized prior to the delivery of such Trust Securities Certificates or did not hold such offices at the date of delivery of such Trust Securities Certificates. A transferee of a Trust Securities Certificate shall become a Holder, and shall be entitled to the rights and subject to the obligations of a Holder hereunder, upon due registration of such Trust Securities Certificate in such transferee=s name pursuant to Section 5.4.

Section 5.3. Execution and Delivery of Trust Securities Certificates. On the Closing Date, the Administrators shall cause Trust Securities Certificates, consisting of the Capital Securities in the aggregate Initial Liquidation Preference as provided in Section 2.4 and the Common Securities having an aggregate Initial Liquidation Amount as provided in Section 2.5, to be executed by an Administrator on behalf of the Trust and delivered to or upon the written order of the Depositor, signed by its chairman of the board, its president, any executive vice president or any vice president, treasurer or assistant treasurer or controller, without further corporate action by the Depositor and without further action by the Trust, in authorized denominations.

Section 5.4. Registration of Transfer and Exchange of Capital Securities Certificates. (a) The Securities Registrar shall keep or cause to be kept, at the office or agency maintained pursuant to Section 5.8, a register or registers for the purpose of registering Trust Securities Certificates and

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transfers and exchanges of Capital Securities Certificates as herein provided (the “Securities Register”), in which the registrar thereof (the “Securities Registrar”) designated by the Property Trustee with the reasonable consent of the Administrators, subject to such reasonable regulations as the Securities Registrar may prescribe, shall provide for the registration of Capital Securities Certificates and Common Securities Certificates (subject to Section 5.10 in the case of the Common Securities Certificates) and registration of transfers and exchanges of Capital Securities Certificates as herein provided. The Property Trustee shall be the initial Securities Registrar. The provisions of this Trust Agreement, including Sections 8.1, 8.3 and 8.6, shall apply to the Property Trustee also in its role as Securities Registrar, for so long as the Property Trustee shall act as Securities Registrar.

     Upon surrender for registration of transfer of any Capital Securities Certificate at the office or agency maintained pursuant to Section 5.8, the Administrators or any one of them shall (i) prepare, execute and deliver, in the name of the designated transferee or transferees, one or more new Capital Securities Certificates in authorized denominations of a like aggregate Liquidation Preference as the then current Liquidation Preference of the Capital Securities Certificate so surrendered for registration of transfer and dated the date of execution by such Administrator, and (ii) notify and instruct the Securities Registrar regarding the appropriate entries to be made in the Securities Register.

     The Securities Registrar shall not be required to register the transfer of any Capital Securities that have been called for redemption.

     At the option of a Holder, Capital Securities Certificates may be exchanged for other Capital Securities Certificates in authorized denominations of a like aggregate Liquidation Preference as the then current aggregate Liquidation Preference of the Capital Securities Certificates to be surrendered for exchange upon surrender of the Capital Securities Certificates to be exchanged at the office or agency maintained pursuant to Section 5.8. Whenever any Capital Securities Certificates are so surrendered for exchange, an Administrator shall (i) prepare, execute and deliver the Capital Securities Certificates which the Holder making the exchange is entitled to receive, and (ii) notify and instruct the Securities Registrar regarding the appropriate entries to be made in the Securities Register.

     Every Capital Securities Certificate presented or surrendered for registration of transfer or exchange shall be accompanied by a written instrument of transfer in customary form duly executed by the Holder or his attorney duly authorized in writing. Each Capital Securities Certificate surrendered for registration of transfer or exchange shall be delivered by an Administrator to the Securities Registrar and, upon receipt thereof by the Securities Registrar, shall be canceled and subsequently disposed of by the Securities Registrar in accordance with its customary practice.

     No service charge shall be made for any registration of transfer or exchange of Capital Securities Certificates, but the Securities Registrar may require payment of a sum sufficient to cover any tax or governmental charge that may be imposed in connection with any transfer or exchange of Capital Securities Certificates.

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     (b) Capital Securities Certificates shall bear a Restricted Legend. At any time after the Securities Registrar has received an Opinion of Counsel stating that the Capital Securities may be freely transferred without registration under the Securities Act or without being subject to transfer restrictions pursuant to the Securities Act, a new Capital Securities Certificate which does not bear a Restricted Legend may be issued in exchange for or in lieu of a Capital Securities Certificate or any portion thereof which bears such a legend. Neither the Property Trustee nor the Securities Registrar shall be required to ensure or verify compliance with securities laws, including the Securities Act, Exchange Act and 1940 Act in connection with transfers and exchanges of Capital Securities Certificates.

Section 5.5. Mutilated, Destroyed, Lost or Stolen Trust Securities Certificates. If (i) any mutilated Trust Securities Certificate shall be surrendered to the Securities Registrar, or if the Securities Registrar shall receive evidence to its satisfaction of the destruction, loss or theft of any Trust Securities Certificate and (ii) there shall be delivered to the Securities Registrar and the Administrators such security or indemnity as may be required by them to save each of them harmless (provided that if the Holder of such Trust Securities Certificate is an original Purchaser or an Institutional Investor, such Holder=s own unsecured agreement of indemnity shall be deemed acceptable) then, in the absence of notice that such Trust Securities Certificate shall have been acquired by a protected purchaser (as such term is used in section 8-303 of the Delaware Uniform Commercial Code), the Administrators, or any of them, on behalf of the Trust shall prepare, execute and make available for delivery, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen Trust Securities Certificate, a new Trust Securities Certificate of like class, tenor and denomination or, after the Liquidation Date, an Exchange Note. In connection with the issuance of any new Trust Securities Certificate or any Exchange Note under this Section, the Administrators or the Securities Registrar may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection therewith. Any duplicate Trust Securities Certificate issued pursuant to this Section shall constitute conclusive evidence of an undivided beneficial interest in the Trust Property, as if originally issued, whether or not the lost, stolen or destroyed Trust Securities Certificate shall be found at any time.

Section 5.6. Persons Deemed Holders. The Property Trustee, the Administrators and the Securities Registrar shall treat the Person in whose name any Trust Securities Certificate shall be registered in the Securities Register as the owner of such Trust Securities Certificate for the purpose of receiving Distributions and for all other purposes whatsoever, and neither the Property Trustee, the Administrators nor the Securities Registrar shall be bound by any notice to the contrary.

Section 5.7. Access to List of Holders= Names and Addresses. The Administrators or the Depositor shall furnish or cause to be furnished (unless the Property Trustee is acting as Securities Registrar with respect to the Trust Securities) a list, in such form as the Property Trustee may reasonably require, of the names and addresses of the Holders as of the most recent record date (a) to the Property Trustee, quarterly at least five Business Days before each Distribution Date, and (b) to the Property Trustee, promptly after receipt by the Depositor of a request therefor from the Property Trustee in order to enable the Property Trustee to discharge its obligations under this Trust Agreement, in each case to the extent such information is in the possession or control of the

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Administrators or the Depositor and is not identical to a previously supplied list or has not otherwise been received by the Property Trustee in its capacity as Securities Registrar. Each Holder, by receiving and holding a Trust Securities Certificate, shall be deemed to have agreed not to hold the Depositor, the Property Trustee or the Administrators accountable by reason of the disclosure of its name and address, regardless of the source from which such information was derived.

Section 5.8. Maintenance of Office or Agency. The Trust shall maintain an office or offices or agency or agencies where Capital Securities Certificate may be surrendered for registration of transfer or exchange and where notices and demands to or upon the Trust in respect of the Trust Securities may be served. The Administrators initially designate Wilmington Trust Company, Rodney Square North, 1100 North Market Street, Wilmington, Delaware 19890-0001, Attention: MetroCorp Capital Trust I Administrators, c/o Corporate Trust Administration, as the office for such purposes. The Administrators or the Property Trustee, as the case may be, shall give prompt written notice to the Depositor and to the Holders of any change in the location of the Securities Registrar or any such office or agency.

Section 5.9. Appointment of Paying Agent. The Trust shall maintain an office or agency (the “Paying Agent”) where the Capital Securities may be presented for payment and from which Distributions and other payments may be made. The Trust appoints the Property Trustee as the initial Paying Agent. The Paying Agent shall make Distributions to Holders from the Payment Account and shall report the amounts of such Distributions to the Property Trustee (if the Property Trustee is not also the Paying Agent) and the Administrators. Any Paying Agent shall have the revocable power to withdraw funds from the Payment Account for the purpose of making the Distributions referred to above. The Administrators, on behalf of the Trust, may revoke such power and remove the Paying Agent in their sole discretion. The Paying Agent shall initially be the Property Trustee and any co-paying agent chosen by the Property Trustee and reasonably acceptable to the Administrators and the Depositor. Any Person acting as Paying Agent shall be permitted to resign as Paying Agent upon 30 days= written notice to the Administrators and the Property Trustee. In the event that the Property Trustee shall no longer be the Paying Agent or a successor Paying Agent shall resign or its authority to act be revoked, the Administrators shall appoint a successor that is reasonably acceptable to the Property Trustee and the Depositor to act as Paying Agent (which shall be a bank or trust company having a combined capital and surplus of at least $100,000,000). Such successor Paying Agent or any additional Paying Agent shall execute and deliver to the Property Trustee an instrument in which such successor Paying Agent or additional Paying Agent shall agree with the Property Trustee that, as Paying Agent, such successor Paying Agent or additional Paying Agent will hold all sums, if any, held by it for payment to the Holders in trust for the benefit of the Holders entitled thereto until such sums shall be paid to such Holders. The Paying Agent shall return all unclaimed funds to the Property Trustee, and upon removal of a Paying Agent, such Paying Agent shall also return all funds in its possession to the Property Trustee. The provisions of this Trust Agreement, including Sections 8.1, 8.3 and 8.6, shall apply to the Property Trustee also in its role as Paying Agent, for so long as the Property Trustee shall act as Paying Agent, and, to the extent applicable, to any other paying agent appointed hereunder. Any reference in this Trust Agreement to the Paying Agent shall include any co-paying agent unless the context requires otherwise.

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Section 5.10. Ownership of Common Securities by Depositor. On the Closing Date, the Depositor shall acquire and retain beneficial and record ownership of the Common Securities. To the fullest extent permitted by law, other than a transfer in connection with a consolidation or merger of the Depositor into another Person, or any conveyance, transfer or lease by the Depositor of its properties and assets substantially as an entirety to any Person, pursuant to Section 7.04 of the Subordinated Loan Agreement, any attempted transfer of the Common Securities shall be void. The Administrators shall cause each Common Securities Certificate issued to the Depositor to contain a legend stating, AThis Certificate Is Not Transferable@. At no time shall there be more than one Common Securities Certificate outstanding.

Section 5.11. Rights of Holders. (a) The legal title to the Trust Property is vested exclusively in the Property Trustee (in its capacity as such) in accordance with Section 2.9, and the Holders shall not have any right or title therein other than the undivided beneficial interest in the assets of the Trust conferred by their Trust Securities, and they shall have no right to call for any partition or division of property, profits or rights of the Trust except as described below. The Trust Securities shall be personal property giving only the rights specifically set forth therein and in this Trust Agreement. Holders of the Trust Securities shall have no preemptive or similar rights to subscribe for additional Trust Securities. When issued and delivered to Holders of Capital Securities against payment of the purchase price therefor, the Capital Securities will be validly issued, fully paid and nonassessable undivided beneficial interests in the Trust Property. Subject to Section 4.8 in the case of the Common Securities, the Holders, in their capacities as such, shall be entitled to the same limitation of personal liability extended to stockholders of private corporations for profit organized under the General Corporation Law of the State of Delaware.

     (b) For so long as any Capital Securities remain outstanding, if, upon a Subordinated Note Event of Default which gives the holder of the Subordinated Note the right to declare the principal of such Subordinated Note to be immediately due and payable, the Property Trustee fails to declare the principal of the Subordinated Note to be immediately due and payable after having been requested in writing to do by the Holders of at least 51% of the Liquidation Preference of the Capital Securities then outstanding, the Holders of at least 51% of the Liquidation Preference of the Capital Securities then outstanding shall have such right by a notice in writing to the Depositor and the Property Trustee; and upon any such declaration such principal amount of and the accrued interest on the Subordinated Note shall become immediately due, provided that the payment of principal and interest on such Subordinated Note shall remain subordinated to the extent provided in the Subordinated Loan Agreement.

     At any time after such a declaration of acceleration with respect to the Subordinated Note has been made and before a judgment or decree for payment of the money due has been obtained by the Property Trustee, the Holders of at least 51% of the Liquidation Preference of the Capital Securities then outstanding, by written notice to the Property Trustee and the Depositor, may rescind and annul such declaration and its consequences if:

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     (i) the Depositor has paid or deposited with the Property Trustee a sum sufficient to pay

     (A) all overdue installments of interest on the Subordinated Note; and

     (B) the principal of the portion of the Subordinated Note which has become due otherwise than by such declaration of acceleration; and

     (ii) all Defaults and Subordinated Note Events of Default, other than the non-payment of the principal of the Subordinated Note which has become due solely by such acceleration, have been cured or waived as provided in Article VIII of the Subordinated Loan Agreement.

     The Holders of at least 66 2/3% of the Liquidation Preference of the Capital Securities then outstanding may, on behalf of the Holders of all the Capital Securities, waive any Default or Subordinated Note Event of Default, except a default in the payment of principal or interest (unless such default has been cured and a sum sufficient to pay all matured installments of interest and principal due otherwise than by acceleration and interest on any of the foregoing has been deposited with the Property Trustee) or a default in respect of a covenant or provision which under the Subordinated Loan Agreement cannot be modified or amended without the consent of all of the Holders of the Capital Securities. No such rescission shall affect any subsequent Default or Subordinated Note Event of Default or impair any right consequent thereon.

     (c) For so long as any Capital Securities remain outstanding, upon a Subordinated Note Event of Default specified in Section 8.01(a), 8.01(b) or 8.01 (c) of the Subordinated Loan Agreement, any Holder of Capital Securities shall have the right to institute a proceeding directly against the Depositor for enforcement of payment to such Holder of the principal amount of and interest on the portion of the Subordinated Note having the principal amount equal to the Liquidation Preference of the Capital Securities of such Holder (a ADirect Action@). Except as set forth in Section 5.11(b) and this Section 5.11(c) Holders of Capital Securities shall have no right to exercise directly any right or remedy available to holders of, or in respect of, the Subordinated Note unless and until Exchange Notes shall have been distributed to them pursuant to Section 9.2(b).

ARTICLE VI
ACTS OF HOLDERS; VOTING

Section 6.1. Limitations on Voting Rights. (a) Except as provided in this Section 6.1 and in Sections 5.11(b) and (c) hereof, in Article VIII in the Subordinated Loan Agreement and in Section 7.3 of the Subscription Agreement, and as otherwise required by law, no Holder of Capital Securities, shall have any right to vote or in any manner otherwise control the administration, operation and management of the Trust or the obligations of the parties hereto.

     (b) So long as the Subordinated Note is held by the Property Trustee, the Property Trustee shall not (i) declare that the principal of the Subordinated Note shall be due and payable or

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otherwise direct the time, method or place of conducting any proceeding for any remedy available under the Subordinated Loan Agreement with respect to such Subordinated Note, (ii) waive any Default or Subordinated Note Event of Default which is waivable under Section 9.05 of the Subordinated Loan Agreement, (iii) exercise any right to rescind or annul a declaration that the principal of the Subordinated Note shall be due and payable or (iv) consent to any amendment, modification or termination of the Subordinated Loan Agreement or the Subordinated Note without, in each case, obtaining the prior approval of the Holders of at least a majority of the Liquidation Preference of the Capital Securities then outstanding; provided, however, that where a consent under the Subordinated Loan Agreement would require the consent of the holder of the Subordinated Note or the consent of all of the Holders of the outstanding Capital Securities or, where a consent under this Trust Agreement would change the amount or time of any Redemption Amount, Redemption Date, or reduce the rate or change the method of computing or change the time of payment of Distributions, or change the provisions of Section 5.11(b) or (c) or of this Section 6.1, no such consent shall be given by the Property Trustee without the prior written consent of each Holder of Capital Securities then outstanding. The Administrators and the Property Trustee shall not revoke any action previously authorized or approved by a vote of the Holders of Capital Securities, except by a subsequent vote of the Holders of Capital Securities. The Property Trustee shall notify all Holders of Capital Securities of any notice of Default or Subordinated Note Event of Default received by the Property Trustee under the Subordinated Loan Agreement. In addition to obtaining the foregoing approvals of Holders of Capital Securities, prior to taking any of the foregoing actions, the Administrators and the Property Trustee shall, at the expense of the Depositor, obtain an Opinion of Counsel experienced in such matters to the effect that such action shall not cause the Trust to be classified as an association taxable as a corporation for United States federal income tax purposes. The Trust at no time shall elect to be classified as an association taxable as a corporation for United States federal income tax purposes.

     (c) No amendment to this Trust Agreement shall be effective except with the approval of the Holders of at least a majority (100% in the case of an amendment of the terms of Section 6.1(b)) of the Liquidation Preference of the Capital Securities then outstanding. Notwithstanding any other provision of this Trust Agreement, no amendment to this Trust Agreement may be made if, as a result of such amendment, it would cause the Trust to be classified as an association taxable as a corporation for United States federal income tax purposes.

Section 6.2. Acts of Holders. Any request, demand, authorization, direction, notice, consent, waiver or other action provided or permitted by this Trust Agreement to be given, made or taken by Holders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Holders in person or by an agent duly appointed in writing; and, except as otherwise expressly provided herein, such action shall become effective when such instrument or instruments are delivered to the Property Trustee. Such instrument or instruments (and the action embodied therein and instrument and evidenced thereby) are herein sometimes referred to as the “Act” of the Holders signing such instrument or instruments. Proof of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this Trust Agreement and (subject to Section 8.1) conclusive in favor of the Trustees, if made in the manner provided in this Section.

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     The fact and date of the execution by any Person of any such instrument or writing may be proved by the affidavit of a witness of such execution or by a certificate of a notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument or writing acknowledged to him the execution thereof. Where such execution is by a signer acting in a capacity other than his individual capacity, such certificate or affidavit shall also constitute sufficient proof of his authority. The fact and date of the execution of any such instrument or writing, or the authority of the Person executing the same, may also be provided in any other manner which any Trustee receiving the same deems sufficient.

     Any request, demand, authorization, direction, notice, consent, waiver or other Act of the Holder of any Trust Security shall bind every future Holder of the same Trust Security and the Holder of every Trust Security issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof in respect of anything done, omitted or suffered to be done by the Trustees or the Trust in reliance thereon, whether or not notation of such action is made upon such Trust Security.

Section 6.3. Inspection of Records. Upon reasonable notice to the Administrators and the Property Trustee, the records of the Trust shall be open to inspection by Holders during normal business hours for any purpose reasonably related to such Holder=s interest as a Holder.

ARTICLE VII
REPRESENTATIONS AND WARRANTIES

Section 7.1. Representations and Warranties of the Property Trustee and the Delaware Trustee. The Property Trustee and the Delaware Trustee, each severally on behalf of and only as to itself, hereby represents and warrants for the benefit of the Depositor and the Holders that:

     (a) the Property Trustee (i) is a banking corporation, duly organized, validly existing and in good standing under the laws of the State of Delaware, (ii) has its principal place of business in the State of Delaware, and (iii) has a combined capital and surplus of at least $100,000,000;

     (b) the Property Trustee has full corporate power, authority and legal right to execute, deliver and perform its obligations under this Trust Agreement and has taken all necessary action to authorize the execution, delivery and performance by it of this Trust Agreement;

     (c) the Delaware Trustee is a banking corporation duly organized, validly existing and in good standing under the laws of the State of Delaware;

     (d) the Delaware Trustee has full corporate power, authority and legal right to execute, deliver and perform its obligations under this Trust Agreement and has taken all necessary action to authorize the execution, delivery and performance by it of this Trust Agreement;

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     (e) this Trust Agreement has been duly authorized, executed and delivered by the Property Trustee and the Delaware Trustee and (assuming due authorization, execution and delivery hereof by the Depositor) constitutes the valid and legally binding agreement of each of the Property Trustee and the Delaware Trustee enforceable against each of them in accordance with its terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors= rights and to general equity principles;

     (f) the execution, delivery and performance of this Trust Agreement by each of the Property Trustee and the Delaware Trustee has been duly authorized by all necessary corporate or other action on the part of the Property Trustee and the Delaware Trustee and does not require any approval of stockholders of the Property Trustee or the Delaware Trustee and such execution, delivery and performance will not (i) violate the charter or by-laws of the Property Trustee or the Delaware Trustee, (ii) violate any provision of, or constitute, with or without notice or lapse of time, a default under, or result in the creation or imposition of, any Lien on any properties included in the Trust Property pursuant to the provisions of, any indenture, mortgage, credit agreement, license or other agreement or instrument to which the Property Trustee or the Delaware Trustee is a party or by which it is bound, or (iii) violate any law, governmental rule or regulation of the United States or the State of Delaware, as the case may be, governing the banking or trust powers of the Property Trustee or the Delaware Trustee (as appropriate in context) or any order, judgment or decree applicable to the Property Trustee or the Delaware Trustee;

     (g) neither the authorization, execution or delivery by the Property Trustee or the Delaware Trustee of this Trust Agreement nor the consummation of any of the transactions by the Property Trustee or the Delaware Trustee (as appropriate in context) contemplated herein requires the consent or approval of, the giving of notice to, the registration with or the taking of any other action with respect to any Delaware or United States federal governmental authority or agency under the laws of the United States or the State of Delaware governing the banking or trust powers of the Property Trustee or the Delaware Trustee, as the case may be; and

     (h) there are no proceedings pending or, to the best of each of the Property Trustee=s and the Delaware Trustee=s knowledge, threatened against or affecting the Property Trustee or the Delaware Trustee in any court or before any governmental authority, agency or arbitration board or tribunal which, individually or in the aggregate, would materially and adversely affect the Trust or would question the right, power and authority of the Property Trustee or the Delaware Trustee, as the case may be, to enter into or perform its obligations as one of the Trustees under this Trust Agreement.

Section 7.2. Representations and Warranties of Depositor. The Depositor hereby represents and warrants for the benefit of the Holders that the Trust Securities Certificates issued hereunder on behalf of the Trust have been duly authorized and will have been, duly and validly executed, issued and delivered by the Administrators pursuant to the terms and provisions of, and in accordance with the requirements of, this Trust Agreement and the Holders will be, as of each such date, entitled to the benefits of this Trust Agreement.

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ARTICLE VIII
THE TRUSTEES; THE ADMINISTRATORS

Section 8.1. Certain Duties and Responsibilities. (a) The duties and responsibilities of the Trustees and Administrators shall be as provided by this Trust Agreement. The Property Trustee, prior to the occurrence of an Event of Default and after the curing of all Events of Default that may have occurred, shall undertake to perform such duties and only such duties as are specifically set forth in this Trust Agreement, and no implied covenants shall be read into this Trust Agreement against the Trustees. In case an Event of Default has occurred (that has not been cured or waived), the Property Trustee shall exercise such of the rights and powers vested in it by this Trust Agreement, and use the same degree of care and skill in the exercise thereof, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs. Notwithstanding the foregoing, no provision of this Trust Agreement shall require the Trustees or the Administrators to expend or risk their own funds or otherwise to incur any financial liability in the performance of any of their duties hereunder, or in the exercise of any of their rights or powers, if they shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. Whether or not therein expressly so provided, every provision of this Trust Agreement relating to the conduct or affecting the liability of, or affording protection to the Trustees or the Administrators shall be subject to the provisions of this Section 8.1.

     (b) No provision in this Trust Agreement shall be construed to release an Administrator from liability for his own negligent action, his own negligent failure to act, or his own willful misconduct. To the extent that, at law or in equity, an Administrator has duties (including fiduciary duties) to the Trust or to the Holders, and liabilities relating thereto, such Administrator shall not be liable to the Trust or to any Holder for such Administrator=s good faith reliance on the provisions of this Trust Agreement. The provisions of this Trust Agreement, to the extent that they restrict the duties and liabilities of the Administrators otherwise existing at law or in equity, are agreed by the Depositor and the Holders to replace such other duties and liabilities of the Administrators.

     (c) All payments made by the Property Trustee or a Paying Agent in respect of the Trust Securities shall be made only from the revenue and proceeds from the Trust Property and only to the extent that there shall be sufficient revenue or proceeds from the Trust Property to enable the Property Trustee or a Paying Agent to make payments in accordance with the terms hereof. Each Holder, by its acceptance of a Trust Security, agrees that it will look solely to the revenue and proceeds from the Trust Property to the extent legally available for distribution to it as herein provided and that the Trustees are not personally liable to it for any amount distributable in respect of any Trust Security or for any other liability in respect of any Trust Security. This Section 8.1(c) does not limit the liability of the Trustees expressly set forth elsewhere in this Trust Agreement.

     (d) No provision of this Trust Agreement shall be construed to relieve the Property Trustee from liability for its own grossly negligent action, its own grossly negligent failure to act, or its own willful misconduct, except that:

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     (i) the Property Trustee shall not be liable for any error of judgment made in good faith by an authorized officer of the Property Trustee, unless it shall be proved that the Property Trustee was negligent in ascertaining the pertinent facts upon which such judgment was made;

     (ii) the Property Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Holders of not less than 51% of the Liquidation Preference of the Capital Securities at the time outstanding (or such lesser percentage of the Liquidation Preference of Capital Securities specified herein for the taking of any such action) relating to the time, method and place of conducting any proceeding for any remedy available to the Property Trustee, or exercising any trust or power conferred upon the Property Trustee under this Trust Agreement;

     (iii) the Property Trustee=s sole duty with respect to the custody, safe keeping and physical preservation of the Subordinated Note and the Payment Account shall be to deal with such property in a manner similar to that which the Property Trustee uses when dealing with similar property for its own account, subject to the protections and limitations on liability afforded to the Property Trustee under this Trust Agreement;

     (iv) the Property Trustee shall not be liable for any interest on any money received by it except as it may otherwise agree separately in writing with the Depositor; and money held by the Property Trustee need not be segregated from other funds held by it except in relation to the Payment Account maintained by the Property Trustee pursuant to Section 3.1 and except to the extent otherwise required by law; and

     (v) the Property Trustee shall not be responsible for monitoring the compliance by the Administrators or the Depositor with their respective duties under this Trust Agreement, nor shall the Property Trustee be liable for the default or misconduct of the Administrators or the Depositor.

Section 8.2. Certain Notices. Within five Business Days after a Responsible Officer of the Property Trustee obtains actual knowledge of the occurrence of any Default or Event of Default, the Property Trustee shall transmit, in the manner and to the extent provided in Section 10.8, notice of such Default or Event of Default to the Holders, the Administrators and the Depositor.

     Within two Business Days after the Property Trustee’s receipt of written notice of the Depositor=s exercise of its right to defer the payment of interest on the Subordinated Note pursuant to the Subordinated Loan Agreement, the Property Trustee shall transmit, in the manner and to the extent provided in Section 10.8, notice of such exercise to the Holders, unless prior to transmitting such notice the Property Trustee has received written notice that such exercise shall have been revoked.

Section 8.3. Certain Rights of Property Trustee. Subject to the provisions of Section 8.1:

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     (a) the Property Trustee may conclusively rely and shall be protected in acting or refraining from acting in good faith upon any resolution, Opinion of Counsel, certificate, written representation or instruction of a Holder or transferee, certificate of auditors or any other certificate, statement, instrument, opinion, report, notice, request, consent, order, appraisal, bond, debenture, note, other evidence of indebtedness or other paper or document believed by it in good faith to be genuine and to have been signed or presented by the proper party or parties;

     (b) any direction or act of the Depositor or the Administrators contemplated by this Trust Agreement may be sufficiently evidenced by an Officers= Certificate or by a writing signed by the Administrators and including the statements set forth in clauses (a) — (d) of the definition of Officer’s Certificate, respectively;

     (c) whenever in the administration of this Trust Agreement, the Property Trustee shall deem it desirable that a matter be established before undertaking, suffering or omitting any action hereunder, the Property Trustee (unless other evidence is herein specifically prescribed) may, in the absence of bad faith on its part, request and rely upon an Officer=s Certificate as to such factual matters (other than the interpretation of this Agreement) and/or an Opinion of Counsel, which, upon receipt of such request, shall be promptly delivered by the Depositor or the Administrators;

     (d) the Property Trustee shall have no duty to see to any recording, filing or registration of any instrument (including any financing or continuation statement or any filing under securities laws, or, except to the extent specifically provided in Section 4.5 and Section 4.6 of this Trust Agreement, any filing under tax laws) or any rerecording, refiling or reregistration thereof;

     (e) the Property Trustee may consult with counsel as to legal matters (which counsel may be counsel to the Depositor or any of its Affiliates, and may include any of its employees) and the advice of such counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon and in accordance with such advice; the Property Trustee shall have the right at any time to seek instructions concerning the administration of this Trust Agreement from any court of competent jurisdiction;

     (f) the Property Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Trust Agreement at the request or direction of any of the Holders pursuant to this Trust Agreement, unless such Holders shall have offered to the Property Trustee security or indemnity reasonably satisfactory to it (which shall be limited to an unsecured undertaking, in form and substance reasonably satisfactory to the Property Trustee, in the case of an Institutional Investor) against the costs, expenses (including reasonable attorney’s fees and expenses) and liabilities which might be incurred by it in compliance with such request or direction, including such reasonable advances as may be requested by the Property Trustee;

     (g) the Property Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, approval, bond, debenture, note or other evidence of indebtedness or other

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paper or document, unless specifically requested and directed in writing to do so by one or more Holders, but the Property Trustee may in its discretion make such further inquiry or investigation into such facts or matters as it may see fit;

     (h) the Property Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through its agent, attorneys, custodians or nominees or an Affiliate, provided that the Property Trustee shall be responsible for its own gross negligence or recklessness with respect to selection of any agent or attorney appointed by it hereunder but shall not be responsible for any misconduct by or negligence of such Person;

     (i) whenever in the administration of this Trust Agreement the Property Trustee shall deem it desirable to receive instructions with respect to enforcing any remedy or right or taking any other action hereunder, the Property Trustee (i) may request instructions from the Holders of the Capital Securities, which instructions may only be given by the Holders of the same proportion in Liquidation Preference of the Capital Securities as would be entitled to direct the Property Trustee under the terms of the Capital Securities in respect of such remedy, right or action, (ii) may refrain from enforcing such remedy or right or taking such other action until such instructions are received, and (iii) shall be protected in conclusively relying on or acting in accordance with such instructions;

     (j) except as otherwise expressly provided by this Trust Agreement, the Property Trustee shall not be under any obligation to take any action that is discretionary under the provisions of this Trust Agreement unless directed to do so by any Holder or Holders pursuant to the provisions hereof;

     (k) when the Property Trustee incurs expenses or renders services in connection with a Bankruptcy Event, such expenses (including the fees and expenses of its counsel) and the compensation for such services are intended to constitute expenses of administration under any bankruptcy law or law relating to creditors= rights generally;

     (l) the Property Trustee shall not be charged with knowledge of an Event of Default unless a Responsible Officer of the Property Trustee has obtained actual knowledge of such event or the Property Trustee has received written notice of such event from any Holder or the Depositor;

     (m) at any time that no Responsible Officer of the Property Trustee has actual knowledge that an Event of Default has occurred and is continuing, if (i) in construing any of the provisions in this Trust Agreement, the Property Trustee finds the same ambiguous or inconsistent with any other provisions contained herein, or (ii) the Property Trustee is unsure of the application of any provision of this Trust Agreement or determines that it desires clarification or guidance regarding its performance under any provision of this Trust Agreement, then, except as to any matter as to which the Holders of Capital Securities are specifically entitled to vote under the terms of this Trust Agreement, the Property Trustee may deliver a notice to the Depositor (with a copy to each Holder) requesting written instruction of the Depositor (a copy of which instruction shall also be sent by the Depositor to each Holder) as to the course of action to be taken and the Property Trustee shall take such action, or refrain from taking such action, as the Property Trustee shall be instructed in writing

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to take, or to refrain from taking, by the Depositor, and the Property Trustee may rely conclusively on such instructions and shall have no liability whatsoever for such action or inaction by it in accordance with such instructions; provided, however, that until the Property Trustee has received such requested instructions it may, but shall be under no duty to, take or refrain from taking such action with respect to the matters specified in its request as it shall in good faith deem to be in the best interests of the Holders of Capital Securities;

     (n) if a Responsible Officer of the Property Trustee has actual knowledge that an Event of Default has occurred and is continuing, and (i) in construing any of the provisions in this Trust Agreement, the Property Trustee finds the same ambiguous or inconsistent with any other provision contained herein, or (ii) the Property Trustee is unsure of the application of any provision of this Trust Agreement or determines that it desires clarification or guidance regarding its performance under any provision of this Trust Agreement, then, except as to any matter as to which the Holders of Capital Securities are specifically entitled to vote under the terms of this Trust Agreement, the Property Trustee may deliver a notice to the Holders of Capital Securities requesting written instructions of such Holders as to the course of action to be taken and the Property Trustee shall take such action, or refrain from taking such action, as the Property Trustee shall be instructed in writing to take, or to refrain from taking, by Holders of not less than 51% of the Liquidation Preference of the Capital Securities then outstanding, and the Property Trustee may rely conclusively on such instructions and shall have no liability whatsoever for such action or inaction by it in accordance with such instructions; provided, however, that until the Property Trustee has received such requested instructions, it may, but shall be under no duty to, take or refrain from taking such action with respect to the matters specified in its request as it shall in good faith deem to be in the best interests of the Holders of Capital Securities; and

     (o) subject to the provisions of the third sentence of Section 8.1(a), the Property Trustee shall not be liable for any action taken, suffered, or omitted to be taken by it in good faith, without gross negligence or willful misconduct, and reasonably believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Declaration.

     No provision of this Trust Agreement shall be deemed to impose any duty or obligation on the Property Trustee to perform any act or acts or exercise any right, power, duty or obligation conferred or imposed on it, in any jurisdiction in which it shall be illegal, or in which the Property Trustee shall be unqualified or incompetent in accordance with applicable law, to perform any such act or acts, or to exercise any such right, power, duty or obligation. No permissive power or authority available to the Property Trustee shall be construed to be a duty.

Section 8.4. Not Responsible for Recitals or Issuance of Securities. The recitals contained herein and in the Trust Securities Certificates shall be taken as the statements of the Trust and not as the statements of the Trustees, and the Trustees do not assume any responsibility for their correctness. The Trustees shall not be accountable for the use or application by the Depositor of the proceeds of the Subordinated Notes. The Trustees make no representations as to the value or condition of the Trust Property or any part thereof, or as to the validity or sufficiency of this Trust Agreement or the Trust Securities.

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Section 8.5. May Hold Securities. Any Trustee or any other agent of any Trustee or the Trust, in its individual or any other capacity, may become the owner or pledgee of Trust Securities and may otherwise deal with the Trust with the same rights it would have if it were not a Trustee or such other agent.

Section 8.6. Compensation; Indemnity Fees. The Depositor agrees:

     (a) to pay to each Trustee from time to time such compensation for all services rendered by it hereunder as the Depositor and such Trustee may agree upon in writing from time to time (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust);

     (b) except as otherwise expressly provided herein, to reimburse the Trustees upon request for all reasonable expenses, disbursements and advances incurred or made by the Trustees in accordance with any provision of this Trust Agreement (including the reasonable compensation and the expenses and disbursements of its agents and counsel), except any such expense, disbursement or advance as may be attributable to its gross negligence or bad faith;

     (c) to the fullest extent permitted by applicable law, to indemnify and hold harmless (i) the Bank, (ii) each Trustee, (iii) any Affiliate of the Bank or any Trustee, (iv) any officer, director, shareholder, employee, representative or agent of any Trustee or the Bank and (v) any employee or agent of the Trust or its Affiliates (each of the foregoing referred to herein as an AIndemnified Person@), from and against any loss, damage, liability, tax, penalty, expense or claim of any kind or nature whatsoever incurred by such Indemnified Person by reason of the creation, operation, liquidation or termination of the Trust or any act or omission performed or omitted by such Indemnified Person in good faith on behalf of the Trust and in a manner such Indemnified Person reasonably believed to be within the scope of authority conferred on such Indemnified Person by this Trust Agreement, except that no Indemnified Person shall be entitled to be indemnified pursuant to this Section 8.6 in respect of any loss, damage or claim to the extent incurred by such Indemnified Person by reason of its own gross negligence or willful misconduct with respect to such acts or omissions; and

     (d) to the fullest extent permitted by applicable law, to advance, from time to time, prior to the final disposition of any claim, demand, action, suit or proceeding for which indemnification is authorized pursuant to subsection (c) above, any expenses (including reasonable legal fees) incurred by an Indemnified Person in defending such claim, demand, action, suit or proceeding upon receipt by the Depositor of an undertaking by or on behalf of the Indemnified Person to repay such amount if it shall be determined that the Indemnified Person is not entitled to be indemnified as authorized in subsection (c) above.

     The provisions of this Section 8.6 shall survive the resignation or removal of the Property Trustee and/or the Delaware Trustee and shall survive the termination or the satisfaction and discharge of this Trust Agreement.

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     No Trustee may claim any lien or charge on any Trust Property as a result of any amount due pursuant to this Section 8.6.

     The Depositor and any Trustee may engage in or possess an interest in other business ventures of any nature or description, independently or with others, similar or dissimilar to the business of the Trust, and the Trust and the Holders of Trust Securities shall have no rights by virtue of this Trust Agreement in and to such independent ventures or the income or profits derived therefrom, and the pursuit of any such venture, even if competitive with the business of the Trust, shall not be deemed wrongful or improper. Neither the Depositor nor any Trustee shall be obligated to present any particular investment or other opportunity to the Trust even if such opportunity is of a character that, if presented to the Trust, could be taken by the Trust, and the Depositor or any Trustee shall have the right to take for its own account (individually or as a partner or fiduciary) or to recommend to others any such particular investment or other opportunity. Any Trustee may engage or be interested in any financial or other transaction with the Depositor or any Affiliate of the Depositor, or may act as depository for, trustee or agent for, or act on any committee or body of holders of, securities or other obligations of the Depositor or its Affiliates.

     The provisions of this Trust Agreement, to the extent that they restrict the duties and liabilities of the Trustees otherwise existing at law or in equity, are agreed by the Depositor and the Holders to replace such other duties and liabilities of the Trustees.

Section 8.7. Corporate Property Trustee Required; Eligibility of Trustees and Administrators. (a) There shall at all times be a Property Trustee hereunder with respect to the Trust Securities. The Property Trustee shall be a Person that is not an Affiliate of the Depositor and that is a national or state chartered bank or trust company and has a combined capital and surplus of at least $100,000,000. If any such Person publishes reports of condition at least annually, pursuant to law or to the requirements of its supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such Person shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time the Property Trustee with respect to the Trust Securities shall cease to be eligible in accordance with the provisions of this Section, it shall resign immediately in the manner and with the effect hereinafter specified in this Article. At the time of appointment, any Property Trustee (other than the original Property Trustee) must have its outstanding long term unsecured indebtedness rated in one of the three highest rating categories by a nationally recognized statistical rating organization.

     (b) There shall at all times be one or more Administrators hereunder with respect to the Trust Securities. Each Administrator shall be either a natural person who is at least 21 years of age or a legal entity that shall act through one or more persons authorized to bind that entity.

     (c) There shall at all times be a Delaware Trustee with respect to the Trust Securities. The Delaware Trustee shall not be an Affiliate of the Depositor and shall either be (i) a natural person who is at least 21 years of age and a resident of the State of Delaware or (ii) a legal entity with its principal place of business in the State of Delaware and that otherwise meets the

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requirements of applicable Delaware law that shall act through one or more persons authorized to bind such entity.

Section 8.8. Co-Trustees and Separate Trustee. Unless an Event of Default shall have occurred and be continuing, at any time or times, the Property Trustee shall have the power to appoint, and upon the written request of the Property Trustee, the Depositor and the Administrators shall for such purpose join in the execution, delivery, and performance of all instruments and agreements necessary or proper to appoint, one or more Persons approved by the Property Trustee either to act as co-trustee, jointly with the Property Trustee, of all or any part of such Trust Property, or to the extent required by law to act as separate trustee of any such property, in either case with such powers as may be provided in the instrument of appointment, and to vest in such Person or Persons in the capacity aforesaid, any property, title, right or power deemed necessary or desirable, subject to the other provisions of this Section. Any co-trustee or separate trustee appointed pursuant to this Section shall either be (i) a natural person who is at least 21 years of age and a resident of the United States or (ii) a legal entity with its principal place of business in the United States that shall act through one or more persons authorized to bind such entity.

     Should any written instrument from the Depositor be required by any co-trustee or separate trustee so appointed for more fully confirming to such co-trustee or separate trustee such property, title, right, or power, any and all such instruments shall, on request, be executed, acknowledged and delivered by the Depositor.

     Every co-trustee or separate trustee shall, to the extent permitted by law, but to such extent only, be appointed subject to the following terms, namely:

     (a) All rights, powers, duties, and obligations hereunder in respect of the custody of securities, cash and other personal property held by, or required to be deposited or pledged with, the Trustees specified hereunder shall be exercised solely by such Trustees and not by such co-trustee or separate trustee.

     (b) The rights, powers, duties, and obligations hereby conferred or imposed upon the Property Trustee in respect of any property covered by such appointment shall be conferred or imposed upon and exercised or performed by the Property Trustee or by the Property Trustee and such co-trustee or separate trustee jointly, as shall be provided in the instrument appointing such co-trustee or separate trustee, except to the extent that under any law of any jurisdiction in which any particular act is to be performed, the Property Trustee shall be incompetent or unqualified to perform such act, in which event such rights, powers, duties and obligations shall be exercised and performed by such co-trustee or separate trustee.

     (c) The Property Trustee at any time, by an instrument in writing executed by it, may accept the resignation of or remove any co-trustee or separate trustee appointed under this Section. Upon the written request of the Property Trustee, the Depositor shall join with the Property Trustee in the execution, delivery and performance of all instruments and agreements necessary or proper to

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effectuate such resignation or removal. A successor to any co-trustee or separate trustee so resigned or removed may be appointed in the manner provided in this Section.

     (d) No co-trustee or separate trustee hereunder shall be personally liable by reason of any act or omission of the Property Trustee or any other trustee hereunder.

     (e) The Property Trustee shall not be liable by reason of any act or omission of a co-trustee or separate trustee appointed hereunder and shall have no obligation to supervise the performance by any such co-trustee or separate trustee so appointed in accordance with this Trust Agreement.

     (f) Any Act of Holders delivered to the Property Trustee shall be deemed to have been delivered to each such co-trustee and separate trustee.

Section 8.9. Resignation and Removal; Appointment of Successor. No resignation or removal of any Trustee (the ARelevant Trustee@) and no appointment of a successor Trustee pursuant to this Article shall become effective until the acceptance of appointment by the successor Trustee (which shall meet all of the requirements of Section 8.7(a) in the case of a successor Property Trustee and all of the requirements of Section 8.7(c) in the case of a successor Delaware Trustee) in accordance with the applicable requirements of Section 8.10.

     Subject to the immediately preceding paragraph, the Relevant Trustee may resign at any time by giving written notice thereof to the Holders. If the instrument of acceptance by the successor Trustee required by Section 8.10 shall not have been delivered to the Relevant Trustee within 60 days after the giving of such notice of resignation, the Relevant Trustee may petition, at the expense of the Depositor, any court of competent jurisdiction for the appointment of a successor Relevant Trustee.

     The Property Trustee or the Delaware Trustee, or both of them, may be removed by Act of the Holders of not less than 51% in Liquidation Preference of the Capital Securities then outstanding, delivered to the Relevant Trustee (in its individual capacity and on behalf of the Trust).

     If any Trustee shall resign, be removed or become incapable of acting as Trustee, or if a vacancy shall occur in the office of any Trustee for any cause, the Holders of the Capital Securities, by Act of the Holders of not less than 51% in Liquidation Preference of the Capital Securities then outstanding delivered to the retiring Relevant Trustee, shall promptly appoint a successor Relevant Trustee or Trustees, and such successor Trustee shall comply with the applicable requirements of Sections 8.7 and 8.10. If no successor Relevant Trustee shall have been so appointed by the Holders of the Capital Securities and accepted appointment in the manner required by Section 8.10, any Holder who has been a Holder of Trust Securities for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the appointment of a successor Relevant Trustee.

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     The Property Trustee shall give notice of each resignation and each removal of a Trustee and each appointment of a successor Trustee to all Holders in the manner provided in Section 10.8 and shall give notice to the Depositor. Each notice of the appointment of a successor Trustee shall include the name of such successor Trustee and the address of its Corporate Trust Office if it is the Property Trustee.

Section 8.10. Acceptance of Appointment by Successor. In case of the appointment hereunder of a successor Relevant Trustee, the retiring Relevant Trustee, upon the payment in full to it of all amounts due to it under this Trust Agreement, including Section 8.6, and each successor Relevant Trustee with respect to the Trust Securities shall execute and deliver an amendment hereto wherein each successor Relevant Trustee shall accept such appointment and which (i) shall contain such provisions as shall be necessary or desirable to transfer and confirm to, and to vest in, each successor Relevant Trustee all the rights, powers, trusts and duties of the retiring Relevant Trustee with respect to the Trust Securities and the Trust and (ii) shall add to or change any of the provisions of this Trust Agreement as shall be necessary to provide for or facilitate the administration of the Trust by more than one Relevant Trustee, it being understood that nothing herein or in such amendment shall constitute such Relevant Trustees co-trustees. Upon the execution and delivery of such amendment, the resignation or removal of the retiring Relevant Trustee shall become effective to the extent provided therein and each such successor Relevant Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Relevant Trustee; but, on request of the Trust or any successor Relevant Trustee and the payment in full to the retiring Trustee of all amounts due to it under this Trust Agreement, including Section 8.6, such retiring Relevant Trustee shall duly assign, transfer and deliver to such successor Relevant Trustee all Trust Property, all proceeds thereof and money held by such retiring Relevant Trustee hereunder with respect to the Trust Securities and the Trust.

     Upon request of any such successor Relevant Trustee, the Trust shall execute any and all instruments for more fully and certainly vesting in and confirming to such successor Relevant Trustee all such rights, powers and trusts referred to in the first or second preceding paragraph, as the case may be.

     No successor Relevant Trustee shall accept its appointment unless at the time of such acceptance such successor Relevant Trustee shall be qualified and eligible under this Article.

Section 8.11. Merger, Conversion, Consolidation or Succession to Business. Any Person into which the Property Trustee or the Delaware Trustee may be merged or converted or with which it may be consolidated, or any Person resulting from any merger, conversion or consolidation to which such Relevant Trustee shall be a party, or any Person succeeding to all or substantially all the corporate trust business of such Relevant Trustee, shall be the successor of such Relevant Trustee hereunder, without the execution or filing, except for any Delaware filing required by the Delaware Business Trust Act, of any paper or any further act on the part of any of the parties hereto, provided such Person shall be otherwise qualified and eligible under this Article.

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Section 8.12. Preferential Collection of Claims Against Depositor or Trust. In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other similar judicial proceeding relative to the Trust or any other obligor upon the Trust Securities or the property of the Trust or of such other obligor or their creditors, the Property Trustee (irrespective of whether any Distributions on the Trust Securities shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether the Property Trustee shall have made any demand on the Trust for the payment of any past due Distributions) shall be entitled and empowered, to the fullest extent permitted by law, by intervention in such proceeding or otherwise:

     (i) to file and prove a claim for the whole amount of any Distributions owing and unpaid in respect of the Trust Securities and to file such other papers or documents as may be necessary or advisable in order to have the claims of the Property Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Property Trustee, its agents and counsel) and of the Holders allowed in such judicial proceeding, and

     (ii) to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Property Trustee and, in the event the Property Trustee shall consent to the making of such payments directly to the Holders, to pay to the Property Trustee any amount due it for the reasonable compensation, expenses, disbursements and advances of the Property Trustee, its agents and counsel, and any other amount due the Property Trustee.

     Nothing herein contained shall be deemed to authorize the Property Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or compensation affecting the Trust Securities or the rights of any Holder thereof or to authorize the Property Trustee to vote in respect of the claim of any Holder in any such proceeding.

Section 8.13. Reports by Property Trustee. (a) Not later than March 31 of each year commencing with March 31, 2002, the Property Trustee shall transmit to all Holders in accordance with Section 10.8, and to the Depositor, a brief report dated as of the immediately preceding December 31 with respect to:

     (i) its eligibility under Section 8.7 or, in lieu thereof, if to the best of its knowledge it has continued to be eligible under said Section, a written statement to such effect;

     (ii) a statement that the Property Trustee has complied with all of its obligations under this Trust Agreement during the twelve-month period (or, in the case of the initial report, the period since the Closing Date) ending with such December 31 or, if the Property Trustee has not complied in any material respect with such obligations, a description of such noncompliance; and

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     (iii) any change in the property and funds in its possession as Property Trustee since the date of its last report and any action taken by the Property Trustee in the performance of its duties hereunder which it has not previously reported and which in its opinion materially affects the Trust Securities.

     (b) A copy of each such report shall, at the time of such transmission to Holders, be filed by the Property Trustee with the Depositor.

Section 8.14. Number of Trustees. (a) The number of Trustees shall be two. The Property Trustee and the Delaware Trustee may be the same Person.

     (b) If a Trustee ceases to hold office for any reason a vacancy shall occur. The vacancy shall be filled with a Trustee appointed in accordance with Section 8.9.

     (c) The death, resignation, retirement, removal, bankruptcy, incompetence or incapacity to perform the duties of a Trustee shall not operate to dissolve, terminate or annul the Trust.

Section 8.15. Delegation of Power. (a) Any Administrator may, by power of attorney consistent with applicable law, delegate to any other natural person over the age of 21 his or her power for the purpose of executing any documents contemplated in Section 2.7(a).

     (b) The Administrators shall have power to delegate from time to time to such of their number or to the Depositor the doing of such things and the execution of such instruments either in the name of the Trust or the names of the Administrators or otherwise as the Administrators may deem expedient, to the extent such delegation is not prohibited by applicable law or contrary to the provisions of this Trust Agreement, as set forth herein.

Section 8.16. Appointment of Administrators. (a) The Administrators shall be appointed by the Common Security Holder and may be removed by the Common Security Holder at any time. Each Administrator shall either execute a counterpart of this Trust Agreement or sign an agreement agreeing to comply with the terms of this Trust Agreement. If at any time there is no Administrator, the Property Trustee or any Security Holder who has been a Security Holder of Trust Securities for at least six months may petition any court of competent jurisdiction for the appointment of one or more Administrators.

     (b) Whenever a vacancy in the number of Administrators shall occur, until such vacancy is filled by the appointment of an Administrator in accordance with this Section 8.16, the Administrators in office, regardless of their number (and notwithstanding any other provision of this Agreement), shall have all the powers granted to the Administrators and shall discharge all the duties imposed upon the Administrators by this Trust Agreement.

     Notwithstanding the foregoing or any other provision of this Trust Agreement, in the event any Administrator or a Delaware Trustee who is a natural person dies or becomes, in the opinion of the Holder of Common Securities, incompetent or incapacitated, the vacancy created by such death,

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incompetence or incapacity may be filled by (a) in the case of an Administrator, the unanimous act of the remaining Administrator or Administrators and (b) in the case of the Delaware Trustee, the Property Trustee (with the successor in each case being a Person who satisfies the eligibility requirement for Administrators or Delaware Trustee, as the case may be, set forth in Section 8.7).

ARTICLE IX
TERMINATION AND MERGER

Section 9.1. Termination Upon Expiration Date. Unless earlier terminated, the Trust shall automatically terminate on November 1, 2031 (the “Expiration Date”), following the distribution of the Trust Property.

Section 9.2. Early Termination. The Trust shall, subject to the provisions of Section 9.3, terminate prior to the Expiration Date upon the occurrence of any of the following events (each an “Early Termination Event”):

     (a) the occurrence of a Bankruptcy Event in respect of, or the dissolution or liquidation of, the Holder of the Common Securities;

     (b) the written direction to the Property Trustee from the Holder of the Common Securities at any time to terminate the Trust and, after satisfaction of liabilities to creditors of the Trust as provided by applicable law, distribute note certificates prepared by the Administrators and delivered to the Property Trustee (the “Exchange Notes”) representing Like Amounts of the Subordinated Note to Holders in exchange for the respective Capital Securities held by them; provided, however, that the Property Trustee and the Holders shall have first received an Opinion of Counsel to the effect that such distribution will not be a taxable event to the Holders of Capital Securities; and provided, further, that, in any such event, the Depositor will issue to each Holder of Capital Securities a Subordinated Note in its own name in the principal amount of its fractional interest in the Subordinated Note and the Depositor agrees that the Subordinated Loan Agreement shall be amended, on or prior to the Liquidation Date, pursuant to Section 9.05 of the Subordinated Loan Agreement to include provisions regarding transfer and exchange of Subordinated Notes, voting and enforcement of rights and such other related matters as would customarily be provided if the Subordinated Loan Agreement was an agreement between the Depositor and the then Holders of Capital Securities as lenders, all on terms and provisions and pursuant to documentation reasonably satisfactory to at least 66% in Liquidation Preference of the Capital Securities then outstanding;

     (c) the redemption of all of the Capital Securities in connection with the repayment in full of the Subordinated Note pursuant to the terms of the Subordinated Loan Agreement; and

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     (d) the entry of an order for dissolution of the Trust by a court of competent jurisdiction.

Section 9.3. Termination. The respective obligations and responsibilities of the Trustees and the Trust shall terminate upon the latest to occur of the following:

     (a) the distribution by the Property Trustee to Holders upon the liquidation of the Trust, or upon the redemption of all of the Trust Securities pursuant to Section 4.2, of all amounts required to be distributed hereunder upon the final payment of the Trust Securities;

     (b) the payment of any expenses owed by the Trust; and

     (c) the discharge of all administrative duties of the Administrators, including the performance of any tax reporting obligations with respect to the Trust or the Holders.

Section 9.4. Liquidation. (a) If an Early Termination Event specified in clause (a), (b) or (d) of Section 9.2 occurs or upon the Expiration Date, the Trust shall be liquidated by the Property Trustee as expeditiously as the Property Trustee determines to be possible by distributing, after satisfaction of liabilities to creditors of the Trust as provided by Section 3808(e) of the Delaware Business Trust Act and any other applicable law, to each Holder a Like Amount of the Subordinated Note. Notice of liquidation shall be given by the Property Trustee by a recognized overnight delivery service (charges prepaid) sent not later than 30 days or more than 60 days prior to the Liquidation Date to each Holder of Trust Securities at such Holder=s address appearing in the Securities Register. All notices of liquidation shall:

     (i) state the Liquidation Date;

     (ii) state that from and after the Liquidation Date, the Trust Securities will no longer be deemed to be outstanding and any Trust Securities Certificates not surrendered for exchange will be deemed to represent a Like Amount of the Subordinated Note; and

     (iii) provide such information with respect to the mechanics by which Holders may exchange Trust Securities Certificates for Exchange Notes.

     (b) The Property Trustee shall establish a record date for such distribution (which shall be not more than 45 days prior to the Liquidation Date) and, either itself acting as exchange agent or through the appointment of a separate exchange agent, shall establish such procedures as it shall deem appropriate to effect the distribution of Exchange Notes in exchange for the outstanding Trust Securities Certificates.

     (c) After the Liquidation Date, (i) the Trust Securities will no longer be deemed to be outstanding, (ii) Exchange Notes will be issued to Holders of Trust Securities Certificates, upon

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surrender of such certificates to the exchange agent for exchange, (iii) any Trust Securities Certificates not so surrendered for exchange will be deemed to represent a Like Amount of the Subordinated Note, accruing interest at the rate provided for in the Subordinated Note from the last Distribution Date on which Distribution was made on such Trust Securities Certificates until such certificates are so surrendered (and, subject to the provisions of Section 5.5, until such certificates are so surrendered, no payments of interest or principal will be made to Holders of Trust Securities Certificates with respect to such Subordinated Note) and (iv) all rights of Holders holding Trust Securities will cease, except the right of such Holders to receive Exchange Notes upon surrender of Trust Securities Certificates.

Section 9.5. No Mergers, Consolidations, Amalgamations or Replacements of the Trust. The Trust may not merge with or into, consolidate, amalgamate, or be replaced by, or convey, transfer or lease its properties and assets substantially as an entirety to any Person.

Section 9.6. Certificate of Cancellation. As soon as practicable upon completion of winding up of the Trust, the Trustees shall execute and file a certificate of cancellation for the Trust with the Secretary of State of Delaware if then required by the Delaware Business Trust Act.

ARTICLE X
MISCELLANEOUS PROVISIONS

Section 10.1. Limitation of Rights of Holders. The death or incapacity, or the dissolution, liquidation, termination, or the bankruptcy of any Person having an interest, beneficial or otherwise, in Trust Securities shall not operate to terminate this Trust Agreement, nor entitle the legal representatives, successors or heirs of such person or any Holder for such person, to claim an accounting, take any action or bring any proceeding in any court for a partition or winding up of the arrangements contemplated hereby, nor otherwise affect the rights, obligations and liabilities of the parties hereto or any of them.

Section 10.2. Amendment. (a) Except as provided in Section 6.1(b), no amendment to this Trust Agreement shall be effective except with (i) the approval of the Holders of at least 66% in Liquidation Preference of the Capital Securities then outstanding and (ii) receipt by the Trustees of an Opinion of Counsel to the effect that such amendment or the exercise of any power granted to the Trustees in accordance with such amendment will not cause the Trust to be an association taxable as a corporation for United States federal income tax purposes or adversely affect the Trust’s exemption from status of an investment company under the 1940 Act.

     (b) In addition to and notwithstanding any other provision in this Trust Agreement, without the consent of each affected Holder, this Trust Agreement may not be amended to (i) change the amount or timing of any Distribution or the payment of any Redemption Amount or otherwise adversely affect the amount of any Distribution or Redemption Amount required to be made as of a specified date or (ii) restrict the right of a Holder to institute suit for the enforcement of any such payment on or after such date. Notwithstanding any other provision herein, without the unanimous consent of the Holders, this paragraph (b) of this Section 10.2 may not be amended.

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     (c) Notwithstanding any other provisions of this Trust Agreement, no Trustee shall enter into or consent to any amendment to this Trust Agreement until it has received the Opinion of Counsel referred to in Section 10.2(a)(ii) above.

     (d) Notwithstanding anything in this Trust Agreement to the contrary, without the consent of the Depositor, this Trust Agreement may not be amended in a manner which imposes any additional obligation or liability on the Depositor.

     (e) If any amendment to this Trust Agreement is made, the Administrators or the Property Trustee shall promptly provide to the Depositor and to each Holder of Capital Securities a copy of such amendment.

     (f) Notwithstanding any other provisions of this Trust Agreement, neither the Property Trustee nor the Delaware Trustee shall be required to enter into any amendment to this Trust Agreement, including any amendment to this Section 10.2(f), which affects its own rights, powers, duties, obligations, liabilities or immunities under this Trust Agreement, and any such amendment or purported amendment shall be void and ineffective unless executed by such Trustees, which execution may be withheld or declined by the Trustees in their sole discretion. The Property Trustee shall be entitled to receive an Opinion of Counsel and an Officers= Certificate stating that any amendment to this Trust Agreement is in compliance with this Trust Agreement.

Section 10.3. Separability. If any provision in this Trust Agreement or in the Trust Securities Certificates shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

SECTION 10.4. GOVERNING LAW. THIS TRUST AGREEMENT AND THE RIGHTS OF THE PARTIES HEREUNDER AND OF THE HOLDERS SHALL BE GOVERNED BY AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE AND ALL RIGHTS AND REMEDIES SHALL BE GOVERNED BY SUCH LAWS WITHOUT REGARD, TO THE MAXIMUM EXTENT PERMITTED BY LAW, TO PRINCIPLES OF CONFLICTS OF LAWS OF THE STATE OF DELAWARE OR ANY OTHER JURISDICTION THAT WOULD CALL FOR THE APPLICATION OF THE LAW OF ANY JURISDICTION OTHER THAN THE STATE OF DELAWARE; PROVIDED, HOWEVER, THAT, TO THE FULLEST EXTENT PERMITTED BY LAW, THERE SHALL NOT BE APPLICABLE TO THE PARTIES HEREUNDER OR THIS TRUST AGREEMENT ANY PROVISION OF THE LAWS (COMMON OR STATUTORY) OF THE STATE OF DELAWARE PERTAINING TO TRUSTS THAT RELATE TO OR REGULATE, IN A MANNER INCONSISTENT WITH THE TERMS HEREOF, (A) THE FILING WITH ANY COURT OR GOVERNMENTAL BODY OR AGENCY OF TRUSTEE ACCOUNTS OR SCHEDULES OF TRUSTEE FEES AND CHARGES, (B) AFFIRMATIVE REQUIREMENTS TO POST BONDS FOR TRUSTEES, OFFICERS, AGENTS OR EMPLOYEES OF A TRUST, (C) THE NECESSITY FOR OBTAINING COURT OR OTHER GOVERNMENTAL APPROVAL CONCERNING THE ACQUISITION, HOLDING OR DISPOSITION OF REAL OR PERSONAL PROPERTY, (D) FEES OR OTHER SUMS PAYABLE TO TRUSTEES, OFFICERS, AGENTS OR EMPLOYEES OF A TRUST, (E) THE ALLOCATION

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OF RECEIPTS AND EXPENDITURES TO INCOME OR PRINCIPAL, (F) RESTRICTIONS OR LIMITATIONS ON THE PERMISSIBLE NATURE, AMOUNT OR CONCENTRATION OF TRUST INVESTMENTS OR REQUIREMENTS RELATING TO THE TITLING, STORAGE OR OTHER MANNER OF HOLDING OR INVESTING TRUST ASSETS OR (G) THE ESTABLISHMENT OF FIDUCIARY OR OTHER STANDARDS OF RESPONSIBILITY OR LIMITATIONS ON THE ACTS OR POWERS OF TRUSTEES THAT ARE INCONSISTENT WITH THE LIMITATIONS OR AUTHORITIES AND POWERS OF THE TRUSTEES HEREUNDER AS SET FORTH OR REFERENCED IN THIS TRUST AGREEMENT. SECTION 3540 OF TITLE 12 OF THE DELAWARE CODE SHALL NOT APPLY TO THE TRUST.

Section 10.5. Payments Due on Non-Business Day. If the date fixed for any payment on any Trust Security shall be a day that is not a Business Day, then such payment need not be made on such date but may be made on the next succeeding day that is a Business Day (except as otherwise provided in Section 4.1(a)), with the same force and effect as though made on the date fixed for such payment, and no interest shall accrue thereon for the period after such date.

Section 10.6. Successors. This Trust Agreement shall be binding upon and shall inure to the benefit of any successor to the Depositor, the Administrators, the Trust or the Relevant Trustee, including any successor by operation of law. Except in connection with a consolidation, merger or sale involving the Depositor that is permitted under Section 7.04 of the Subordinated Loan Agreement and pursuant to which the assignee agrees in writing to perform the Depositor=s obligations hereunder, the Depositor shall not assign its obligations hereunder (any purported assignment in contravention of this Section 10.6 being null and void).

Section 10.7. Headings. The Article and Section headings are for convenience only and shall not affect the construction of this Trust Agreement.

Section 10.8. Reports, Notices and Demands. Any report, notice, demand or other communication which by any provision of this Trust Agreement is required or permitted to be given or served to or upon any Holder or the Depositor may be given or served in writing by a recognized overnight delivery service (charges prepaid), hand delivery or facsimile transmission (if the sender on the same day sends a confirming copy of such notice by a recognized overnight delivery service, charges prepaid), in each case, addressed, (a) in the case of a Holder of Capital Securities, to such Holder as such Holder=s name and address may appear on the Securities Register; and (b) in the case of the Holder of the Common Securities or the Depositor, to MetroCorp, Inc., 1523 8^th Street, East Moline, Illinois 61244, Attention: General Counsel, facsimile number: (309) 752-9232 Such notice, demand or other communication to or upon a Holder shall be deemed to have been sufficiently given or made, for all purposes, upon actual receipt by the Holder or Depositor.

     Any notice, demand or other communication which by any provision of this Trust Agreement is required or permitted to be given or served to or upon the Trust, the Property Trustee, the Delaware Trustee or the Administrators shall be given in writing addressed (until another address provided by the Trust in accordance with the provisions of this Section 10.8) as follows: (a) with respect to the Property Trustee to Wilmington Trust Company, Rodney Square North, 1100 North

44

Market Street, Wilmington, Delaware 19890-0001, Attention: Corporate Trust Administration — MetroCorp Capital Trust I; (b) with respect to the Delaware Trustee, to Wilmington Trust Company, Rodney Square North, 1100 North Market Street, Wilmington, Delaware 19890-0001, Attention: Corporate Trust Administration — MetroCorp Capital Trust I; and (c) with respect to the Administrators, to them at the address above for notices to the Depositor, marked “Attention Administrators of MetroCorp Capital Trust I.” Such notice, demand or other communication to or upon the Trust or the Property Trustee shall be deemed to have been sufficiently given or made only upon actual receipt of the writing by the Trust or the Property Trustee.

Section 10.9. Agreement Not to Petition. Each of the Administrators, Trustees and the Depositor agree for the benefit of the Holders that, until at least one year and one day after the Trust has been terminated in accordance with Article IX, they shall not file, or join in the filing of, a petition against the Trust under any bankruptcy, insolvency, reorganization or other similar law (including, without limitation, the United States Bankruptcy Code (collectively, “Bankruptcy Laws”) or otherwise join in the commencement of any proceeding against the Trust under any Bankruptcy Law. In the event the Depositor takes action in violation of this Section 10.9, the Property Trustee agrees, for the benefit of Holders, that at the expense of the Depositor, it shall file an answer with the bankruptcy court or otherwise properly contest the filing of such petition by the Depositor against the Trust or the commencement of such action and raise the defense that the Depositor has agreed in writing not to take such action and should be estopped and precluded therefrom and such other defenses, if any, as counsel for the Trustee or the Trust may assert. The provision of this Section 10.9 shall survive the termination of this Trust Agreement.

SECTION 10.10. ACCEPTANCE OF TERMS OF TRUST AGREEMENT, GUARANTEE AGREEMENT AND SUBORDINATED LOAN AGREEMENT. THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST THEREIN BY OR ON BEHALF OF A HOLDER OR ANY OTHER PERSON HAVING A BENEFICIAL INTEREST THEREIN, WITHOUT ANY SIGNATURE OR FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL ACCEPTANCE BY THE HOLDER AND SUCH OTHERS OF ALL THE TERMS AND PROVISIONS OF THE TRUST AGREEMENT AND AGREEMENT TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AGREEMENT AND THE SUBORDINATED LOAN, AND SHALL CONSTITUTE THE AGREEMENT OF THE TRUST, SUCH HOLDER AND SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE TRUST AND SUCH HOLDER AND SUCH OTHERS.

Section 10.11. Counterparts. The Agreement may be executed in any number of counterparts, each of which shall be an original but all of which together shall constitute one instrument. Each counterpart may consist of a number of copies hereof, each signed by less than all, but together signed by all, of the parties hereto.

Section 10.12. Limited Liability. The Holders of the Capital Securities, in their capacities as such, shall not be personally liable for any liabilities or obligations of the Trust arising out of this

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Agreement, and the parties hereto hereby agree that the Holders of the Capital Securities, in their capacities as such, shall be entitled to the same limitation of personal liability extended to stockholders of private corporations for profit organized under the General Corporation Law of the State of Delaware.

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     IN WITNESS WHEREOF, the undersigned have executed this Trust Agreement as of the date first above written.

MetroCorp, Inc.
By:	/s/ Gary D. Andersen
	Name: Gary D. Andersen
	Title: President
Wilmington Trust Company, as Property Trustee
By:	/s/
	Name:
	Title:
Wilmington Trust Company, as Delaware Trustee
By:	/s/
	Name:
	Title:
/s/ Gary D. Andersen
Gary D. Andersen, as Administrator
/s/ Julius J. Van Paemel
Julius J. Van Paemel, as Administrator

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EXHIBIT A

CERTIFICATE OF TRUST

OF

METROCORP CAPITAL TRUST I

          This Certificate of Trust of MetroCorp Capital Trust I is being executed and filed by the undersigned, as trustee, for the purposes of forming a business trust pursuant to the Delaware Business Trust Act (12 Del.C. '' 3801, et seq.).

     1. Name. The name of the business trust formed hereby is “MetroCorp Capital Trust I” (the “Trust”).

     2. Delaware Trustee. The name and business address of the trustee of the Trust that has its principal place of business in the State of Delaware are as follows:

Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890-0001

          IN WITNESS WHEREOF, the undersigned has executed this Certificate of Trust in accordance with 12 Del.C. '' 3811(a).

WILMINGTON TRUST COMPANY
as Trustee

By:

Name:

Exhibit B

THIS CERTIFICATE IS NOT TRANSFERABLE

Certificate Number
A-1 Number of Common Securities
One (1)

CERTIFICATE EVIDENCING COMMON SECURITIES

OF

METROCORP CAPITAL TRUST I

COMMON SECURITIES

(Initial Liquidation Amount $309,278 per Common Security)

     MetroCorp Capital Trust I, a business trust created under the laws of the State of Delaware (the “Trust”), hereby certifies that MetroCorp, Inc., a Delaware corporation (the “Holder”), is the registered owner of one (1) Common Security (Initial Liquidation Amount $309,278 per Common Security) of the Trust, representing undivided beneficial interest in the assets of the Trust (such Common Security constituting the sole Common Security with respect to the Trust and being herein referred to as the “Common Security” or the “Common Securities”). Except as provided in Section 5.10 of the Trust Agreement (as defined below), the Common Securities are not transferable and any attempted transfer hereof shall be null and void. The designations, rights, privileges, restrictions, preferences and other terms and provisions of the Common Securities are set forth in, and this certificate and the Common Securities represented hereby are issued and shall in all respect be subject to the terms and provisions of, the Amended and Restated Trust Agreement of the Trust dated as of November 1, 2001, as the same may be amended from time to time (the “Trust Agreement” ), including the designation of the terms of the Common Securities as set forth therein. The Trust will furnish a copy of the Trust Agreement to the Holder without charge upon written request to the Trust as its principal place of business or registered office.

     THE RECEIPT AND ACCEPTANCE OF A COMMON SECURITY OR ANY INTEREST THEREIN BY OR ON BEHALF OF A HOLDER, WITHOUT ANY SIGNATURE OR FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL ACCEPTANCE BY THE HOLDER OF ALL THE TERMS AND PROVISIONS OF THE TRUST AGREEMENT AND AGREEMENT TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND THE SUBORDINATED LOAN AGREEMENT, AND SHALL CONSTITUTE THE AGREEMENT OF THE TRUST AND SUCH HOLDER THAT THE TERMS AND PROVISIONS OF THE TRUST AGREEMENT SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE TRUST AND SUCH HOLDER.

B-1

     By receipt and acceptance of this certificate, the Holder agrees to be bound by the Trust Agreement and is entitled to the benefits thereunder.

     IN WITNESS WHEREOF, the undersigned Administrator of the Trust has executed this certificate as of the 1st day of November, 2001.

METROCORP CAPITAL TRUST I
By:
	Name: Gary D. Andersen      Title: Administrator
By:
	Name: Julius J. Van Paemel      Title: Administrator

B-2

Exhibit C

THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE
SECURITIES LAW AND MAY NOT BE SOLD OR OTHERWISE TRANSFERRED
EXCEPT IN COMPLIANCE WITH SUCH ACT AND LAWS.

Certificate Number	Number of Capital Securities
P-	[                                        ]

Certificate Evidencing Capital Securities

of

MetroCorp Capital Trust I

Floating Rate Cumulative Capital Securities

(Initial Liquidation Preference $1,000 per Capital Security)

     MetroCorp Capital Trust I, a business trust created under the laws of the State of Delaware (the “Trust”), hereby certifies that ____ (the “Holder”) is the registered owner of [_________ Insert number of Capital Securities] Floating Rate Cumulative Capital Securities (Initial Liquidation Preference $1,000 per Capital Security) of the Trust, representing undivided beneficial interests in the assets of the Trust (the “Capital Securities”). The Capital Securities are transferable on the books and records of the Trust, in person or by a duly authorized attorney, upon surrender of this certificate duly endorsed and in proper form for transfer as provided in Section 5.4 of the Trust Agreement (as defined below). The designations, rights, privileges, restrictions, preferences and other terms and provisions of the Capital Securities are set forth in, and this certificate and the Capital Securities represented hereby as issued and shall in all respects be subject to the terms and provisions of, the Amended and Restated Trust Agreement of the Trust, dated as of November 1, 2001, as the same may be amended further from time to time (the “Trust Agreement”), including the designation of the terms of Capital Securities as set forth therein. The Holder is entitled to the benefits of the Guarantee Agreement entered into by MetroCorp, Inc., a Delaware corporation (the “Depositor”), dated as of November 1, 2001 (the “Guarantee”), to the extent provided therein. The Trust will furnish a copy of the Trust Agreement and the Guarantee Agreement to the Holder without charge upon written request to the Trust as its principal place of business or registered office.

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     By receipt and acceptance of this certificate, the Holder agrees to be bound by the Trust Agreement and is entitled to the benefits thereunder. The Holder will also be deemed, by its receipt and acceptance of this certificate, to have made the representation set forth in Section 2.1 of the Subscription Agreement (as defined in the Trust Agreement) on the date of its purchase of this certificate.

     THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST THEREIN BY OR ON BEHALF OF A HOLDER OR ANY OTHER PERSON HAVING A BENEFICIAL INTEREST THEREIN, WITHOUT ANY SIGNATURE OR FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL ACCEPTANCE BY THE HOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN SUCH TRUST SECURITY OF ALL THE TERMS AND PROVISIONS OF THE TRUST AGREEMENT AND AGREEMENT TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AGREEMENT AND THE SUBORDINATED LOAN AGREEMENT, AND SHALL CONSTITUTE THE AGREEMENT OF THE TRUST, SUCH HOLDER AND SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE TRUST AND SUCH HOLDER AND SUCH OTHERS.

     IN WITNESS WHEREOF, the undersigned Administrator of the Trust has executed this certificate as of the 1st day of November, 2001.

METROCORP CAPITAL TRUST I
By:
	Name: Gary D. Andersen      Title: Administrator
By:
	Name: Julius J. Van Paemel      Title: Administrator

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ASSIGNMENT

     FOR VALUE RECEIVED, the undersigned assigns and transfers this Capital Securities Certificate to:

     (Insert assignee=s social security or tax identification number)

     (Insert address and zip code of assignee)

and irrevocably appoints

agent to transfer this Capital Securities Certificate on the books of the Trust. The agent may substitute another to act for him or her.

Date:

Signature:

(Sign exactly as your name appears on the other side
of this Capital Securities Certificate)

The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to S.E.C. Rule 17Ad-15.

AGREEMENT AS TO EXPENSES AND LIABILITIES

     AGREEMENT dated as of November 1, 2001 between MetroCorp, Inc., a Delaware corporation (the “Company”), and MetroCorp Capital Trust I, a Delaware business trust (the “Trust”).

     WHEREAS, the Trust intends to issue its Common Securities (the “Common Securities”) to, and receive a Floating Rate Subordinated Promissory Note due 2031 (the “Subordinated Note”) from, the Company and to issue and sell Floating Rate Cumulative Capital Securities (the “Capital Securities”) with such powers, preferences and special rights and restrictions as are set forth in the Amended and Restated Trust Agreement of the Trust dated as of even date herewith (as the same may be amended further from time to time, the “Trust Agreement”); and

     WHEREAS, the Company will directly or indirectly own all of the Common Securities of the Trust and will issue the Subordinated Note.

     NOW, THEREFORE, in consideration of the purchase by each holder of the Capital Securities, which purchase the Company hereby agrees shall benefit the Company and which purchase the Company acknowledges will be made in reliance upon the execution and delivery of this Agreement, the Company, including in its capacity as holder of the Common Securities, and the Trust hereby agree as follows:

ARTICLE I

     SECTION 1.1. GUARANTEE BY THE COMPANY. Subject to the terms and conditions hereof, the Company, including in its capacity as holder of the Common Securities, hereby irrevocably and unconditionally guarantees to each person or entity to whom the Trust is now or hereafter becomes indebted or liable (the “Beneficiaries”) the full payment, when and as due, of any and all Obligations (as hereinafter defined) to such Beneficiaries. As used herein, “Obligations” means any costs, expenses or liabilities of the Trust other than obligations of the Trust to pay to holders of any Capital Securities or other similar interests in the Trust the amounts due such holders pursuant to the terms of the Capital Securities or such other similar interests, as the case may be. This Agreement is intended to be for the benefit of, and to be enforceable by, all such Beneficiaries, whether or not such Beneficiaries have received notice hereof.

     SECTION 1.2. TERM OF AGREEMENT. This Agreement shall terminate and be of no further force and effect upon the later of (a) the date on which full payment has been made of all amounts payable to all holders of all the Capital Securities (whether upon redemption, liquidation, exchange or otherwise) and (b) the date on which there are no Beneficiaries remaining; provided, however, that this Agreement shall continue to be effective or shall be reinstated, as the case may be, if at any time any holder of Capital Securities or any Beneficiary must restore payment of any sums paid under the Capital Securities, under any obligation, under the Capital Securities Guarantee Agreement dated the date hereof by the Company in favor of the Beneficiaries or under this

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Agreement, for any reason whatsoever. This Agreement is continuing, irrevocable, unconditional and absolute.

     SECTION 1.3. WAIVER OF NOTICE. The Company hereby waives notice of acceptance of this Agreement and of any obligation to which it applies or may apply, and the Company hereby waives presentment, demand for payment, protest, notice of nonpayment, notice of dishonor, notice of redemption and all other notices and demands.

     SECTION 1.4. NO IMPAIRMENT. The obligations, covenants, agreements and duties of the Company under this Agreement shall in no way be affected or impaired by reason of the happening from time to time of any of the following:

     (a) the extension of time for the payment by the Trust of all or any portion of the Obligations or for the performance of any other obligation under, arising out of, or in connection with, the Obligations;

     (b) any failure, omission, delay or lack of diligence on the part of the Beneficiaries to enforce, assert or exercise any right, privilege, power or remedy conferred on the Beneficiaries with respect to the Obligations or any action on the part of the Trust granting indulgence or extension of any kind; or

     (c) the voluntary or involuntary liquidation, dissolution, sale of any collateral, receivership, insolvency, bankruptcy, assignment for the benefit of creditors, reorganization, arrangement, composition or readjustment of debt of, or other similar proceedings affecting, the Trust or any of the assets of the Trust.

     The Beneficiaries shall not be obligated to give notice to, or obtain the consent of, the Company with respect to the happening of any of the foregoing.

     SECTION 1.5. ENFORCEMENT. A Beneficiary may enforce this Agreement directly against the Company, and the Company waives any right or remedy to require that any action be brought against the Trust or any other person or entity before proceeding against the Company.

ARTICLE II

     SECTION 2.1. BINDING EFFECT. All guarantees and agreements contained in this Agreement shall bind the successors, assigns, receivers, trustees and representatives of the Company and shall inure to the benefit of the Beneficiaries.

     SECTION 2.2. AMENDMENT. So long as there remains any Beneficiary or any Capital Securities are outstanding, this Agreement shall not be modified or amended in any manner adverse to such Beneficiary or to the holders of the Capital Securities.

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     SECTION 2.3. NOTICES. Any notice, request or other communication required or permitted to be given hereunder shall be given in writing by delivering the same by facsimile transmission (confirmed by mail), telex, or by registered or certified mail, addressed as follows (and if so given, shall be deemed given when mailed or upon receipt of an answer back, if sent by telex):

MetroCorp Capital Trust I
c/o Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890-0001
Facsimile No.: (302) 651-8882
Attention: Corporate Trust Administration — MetroCorp Capital Trust I

MetroCorp Capital Trust I
1523 8^th Street
East Moline, Illinois 61244
Facsimile No.:(390) 752-9232
Attention: General Counsel

     SECTION 2.4. GOVERNING LAW. This Agreement shall be governed by and construed and interpreted in accordance with the laws of the State of Illinois (without regard to conflict of laws principles).

[SIGNATURE PAGE FOLLOWS]

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     THIS AGREEMENT is executed as of the day and year first above written.

METROCORP, INC.
By:	/s/ Gary Andersen
Name: Gary Andersen Title: President
METROCORP CAPITAL TRUST I
By:	/s/ Gary D. Andersen
Name: Gary D. Andersen Title: Administrator
By:	/s/ Julius J. Van Paemel
Name: Julius J. Van Paemel Title: Administrator

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EX-4.2

EXHIBIT 4.2

Subordinated Loan Agreement

between

metrocorp, inc.

and

metrocorp capital trust i

Dated as of November 1, 2001

Table of Contents

	Page
Article I Definitions		1
Board of Directors		1
Capitalized Lease		1
Capitalized Lease Obligation		1
Capital Securities		1
Capital Stock		2
Default		2
Deferred Amount		2
ERISA		2
Event of Default		2
Exchange Act		2
GAAP		3
Governmental Authority		3
Lien		3
Loan		4
Material		4
Material Adverse Effect		4
Multiemployer Plan		4
Officer’s Certificate		4
Past Due Amount		4
Property		4
Required Holders		4
Responsible Officer		4
Restricted Payment		4
Scheduled Rate		5
Senior and Subordinated Debt		5
Subordinated Note		5
Subsidiary		5
Suspension Event		6
Trust		6
Trust Agreement		6
Trust Preferred Security		6
Voting Stock		6
Wholly Owned Subsidiary		6
Article II The Loan		7
Section 2.01. The Loan		7
Section 2.02. Voluntary Prepayment Due to Occurrence of Special Event		7
Section 2.03. Voluntary Prepayment Under Circumstances Other Than Special Events		7
Section 2.04. Other Prepayment Matters		7
Article III Interest		8
Section 3.01. Interest on the Loan		8
Section 3.02. Deferral of Interest Payment		8

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	Page
Article IV Payments		9
Section 4.01. Method and Date of Payment		9
Section 4.02. Set-Off		9
Article V Subordination		9
Section 5.01. Agreement to Subordinate		9
Section 5.02. Default on Senior and Subordinated Debt		9
Section 5.03. Liquidation; Dissolution; Bankruptcy		10
Section 5.04. Subrogation		11
Section 5.05. Notice by the Company		12
Section 5.06. Rights of the Property Trustee; Holders of Senior and Subordinated Debt		13
Section 5.07. Subordination May Not Be Impaired		13
Article VI Representations and Warranties		14
Section 6.01. Representations and Warranties		14
Article VII Covenants		15
Section 7.01. Existence		15
Section 7.02. Insurance		15
Section 7.03. Taxes, Claims for Labor and Materials, Compliance with Laws		16
Section 7.04. Limitation on Consolidations, Mergers, etc		16
Section 7.05. Limitation on Restricted Payments		17
Section 7.06. Capital Adequacy		17
Section 7.07. Ownership of the Trust		17
Section 7.08. Financial and Business Information		17
Section 7.09. Limitation on Certain Restrictive Agreements		19
Article VIII Events of Default		20
Section 8.01. Events of Default		20
Section 8.02. Acceleration		20
Section 8.03. Other Remedies		21
Section 8.04. No Waivers or Election of Remedies, etc		21
Article IX Miscellaneous		21
Section 9.01. Notices		21
Section 9.02. Binding Effect		22
Section 9.03. Governing Law		22
Section 9.04. Counterparts		22
Section 9.05. Amendments and Waivers		22

Exhibit A B Form of Subordinated Note

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     Subordinated Loan Agreement dated as of November 1, 2001 between metrocorp, inc., a Delaware corporation (the “Company”), and MetroCorp Capital Trust I, a statutory business trust formed under the laws of the State of Delaware (the “Trust”) and governed by the Amended and Restated Trust Agreement dated as of even date herewith among the Company, as Depositor, Wilmington Trust Company, as Property Trustee, Wilmington Trust Company, as Delaware Trustee, and Gary D. Andersen and Julius J. Van Paemel, not in their individual capacities but solely as Administrators of the Trust (the “Trust Agreement”).

     Whereas, the sole purpose for which the Trust was formed is to issue Capital Securities and Common Securities pursuant to the Trust Agreement and to lend the net proceeds thereof to the Company (the Company guaranteeing, among other things in connection therewith, the payment obligations of the Trust with respect to such Capital Securities to the extent set forth in the Guarantee Agreement referred to herein); and

     Whereas, the Trust has on the date hereof issued Common Securities and Capital Securities and the Company has requested the Trust to make a loan to the Company in the aggregate principal amount of $10,309,278, representing the proceeds received by the Trust from the issuance of such securities;

     Now, Therefore, the Trust agrees to lend and the Company agrees to borrow such amount on the terms and conditions set forth herein:

Article I

Definitions

     As used in this Agreement, the terms set forth below shall have the following meanings. Capitalized terms used but not otherwise defined herein shall have the meanings assigned to such terms in the Trust Agreement.

     “Board of Directors” means the managers comprising the Board of Directors of the Company, any body performing similar functions on behalf of the Company, or any duly authorized committee thereof.

     “Capitalized Lease” shall mean any lease with respect to which the lessee is required to recognize concurrently the acquisition of an asset and the incurrence of a liability in accordance with GAAP.

     “Capitalized Lease Obligation” means any rental obligation with respect to a Capitalized Lease or for which the amount of the asset and liability thereunder as if so capitalized should be disclosed in a note to such balance sheet, taken at the amount thereof accounted for as indebtedness (net of interest expense) in accordance with GAAP.

     “Capital Securities” shall mean the Floating Rate Cumulative Capital Securities (Initial Liquidation Preference $1,000 per Capital Security) issued by the Trust, the proceeds of which have

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provided a portion of the funds for the Loan and for which the interest and principal payments on the Loan will provide the distributions and redemptions thereof.

     “Capital Stock” in any Person means any and all shares, interests, participations or other equivalents in the equity interest (however designated) in such Person and any rights (other than debt securities convertible into an equity interest, unless and until so converted), warrants or options to acquire an equity interest in such Person.

     “Capital Treatment Event” means the receipt by the Company and the Trust of an opinion of counsel, experienced in such matters and reasonably acceptable to the Required Holders, to the effect that, as a result of any change to laws and regulations currently in effect, there exists a material risk that the Company will be unable to treat the Capital Securities as “Tier I Capital” for purposes of the capital adequacy guidelines of the Federal Reserve.

     “Debt” means with respect to any Person, whether recourse is to all or a portion of the assets of such Person and whether or not contingent: (i) every obligation of such Person for money borrowed; (ii) every obligation of such Person evidenced by bonds, debentures, notes or other similar instruments, including obligations incurred in connection with the acquisition of property, assets or businesses; (iii) every reimbursement obligation of such Person with respect to letters of credit, bankers’ acceptances or similar facilities issued for the account of such Person; (iv) every obligation of such Person issued or assumed as the deferred purchase price of property or services (but excluding trade accounts payable or accrued liabilities arising in the ordinary course of business); (v) every Capitalized Lease Obligation of such Person; and (vi) every obligation of the type referred to in clauses (i) through (v) of another Person and all dividends of another Person the payment of which, in either case, such Person has guaranteed or for which such Person is responsible or liable, directly or indirectly, as obligor or otherwise.

     “Default” shall mean any event, act or condition, the occurrence of which would, with the lapse of time or the giving of notice, or both, constitute an Event of Default.

     “Deferred Amount” shall mean, in relation to the Loan, that portion of the interest which is due for payment and which is not, by reason of deferral pursuant to Section 3.02 hereof, paid on the due date. Interest on the Deferred Amount shall accrue from the scheduled due date until paid in full at the Scheduled Rate and shall accrue as interest on a separate loan rather than being added to the outstanding principal of the Loan.

     “ERISA” shall have the meaning set forth in the Subscription Agreement.

     “Event of Default” is defined in Section 8.01.

     “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, and the rules and regulations promulgated thereunder.

     “Federal Reserve” means the Board of Governors of the Federal Reserve System or any successor thereto.

     “GAAP” shall mean generally accepted accounting principles in effect in the United States at the time of application thereof, as set forth in the opinions and pronouncements of the Financial

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Accounting Standards Board and the American Institute of Certified Public Accountants, consistently applied. Unless otherwise specified herein, all accounting terms used herein shall be interpreted, all determinations with respect to accounting matters hereunder shall be made, and all unaudited financial statements and certificates and reports as to financial matters required to be furnished hereunder shall be prepared, in accordance with GAAP, applied on a basis consistent with the most recent audited consolidated financial statements of the Company and its Subsidiaries delivered pursuant to Section 7.09(b).

     “Governmental Authority” means:

     (a) the government of (i) the United States of America and any State or other political subdivision thereof, or (ii) any jurisdiction in which the Company or any of its Affiliates conducts all or any part of its business, or which asserts jurisdiction over any properties of the Company or any of its Affiliates, or

     (b) any entity exercising executive, legislative, judicial, regulatory or administrative functions of, or pertaining to, any such government.

     “Investment Company Act” means the Investment Company Act of 1940, as amended.

     “Investment Company Event” means the receipt by the Company and the Trust of an opinion of counsel, experienced in such matters and reasonably acceptable to the Required Holders, to the effect that, as a result of the occurrence of a change in law or regulation or a change in interpretation or application of law or regulation by any Governmental Authority (a “Change in Investment Company Act Law”), the Trust is or will be considered an “investment company” that is required to be registered under the Investment Company Act, which Change in Investment Company Act Law becomes effective on or after the date of original issuance of the Capital Securities under the Trust Agreement.

     “Lien” means, with respect to any Person, any mortgage, lien, pledge, adverse claim, charge, security interest or other encumbrance (including, without limitation, any banker’s lien or right of offset), or any interest or title of any vendor, lessor, lender or other secured party to or of such Person under any conditional sale or other title retention agreement or Capitalized Lease, upon or with respect to any Property of such Person (including, in the case of Capital Stock, stockholder agreements, voting trust agreements and all similar arrangements), or any other type of preferential arrangement for the purpose, or having the effect, of protecting a creditor against loss or securing the payment or performance of an obligation, and any agreement to provide any such Lien.

     “Loan” is defined in Section 2.01.

     “Material”, when capitalized, shall mean material in relation to the business, operations, affairs, financial condition, assets, properties or prospects of the Company and its Subsidiaries taken as a whole.

     “Material Adverse Effect” shall mean a material adverse effect on (a) the business, operations, affairs, financial condition, assets, or properties of the Company and its Subsidiaries, taken as a whole, (b) the ability of the Company to perform its obligations under this Agreement, the Guarantee Agreement, the Expense Agreement, the Subordinated Note, the Subscription Agreement

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or the Trust Agreement, (c) the ability of the Trust to perform its obligations under, or to enforce against the Company any of the provisions of, the Expense Agreement, the Subordinated Note, the Subscription Agreement or the Trust Agreement, or (d) the validity or enforceability of this Agreement, the Guarantee Agreement, the Expense Agreement, the Subordinated Note, the Subscription Agreement, the Trust Agreement or the Capital Securities.

     “Multiemployer Plan” shall have the meaning set forth in the Subscription Agreement.

     “Officer’s Certificate” means a certificate signed by the President or a Vice President, and by the Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary, of the Company.

     “Past Due Amount” shall mean, in relation to the Loan, that portion of the interest or principal which is due for payment and which is not, by reason of default (but not deferral pursuant to Section 3.02 hereof), paid on the due date. Interest on the Past Due Amount shall accrue from the scheduled due date until paid in full. Interest on the Past Due Amount shall accrue at the Scheduled Rate.

     “Property” means, with respect to any Person, any interest of such Person in any kind of property or asset, whether real, personal or mixed, or tangible or intangible, including, without limitation, Capital Stock in any other Person.

     “Required Holders” shall mean, at any time, the Holders of at least a majority of the Liquidation Preference of the Capital Securities outstanding at such time, excluding Capital Securities then owned or held by, for the account of or for the benefit or interest of, the Company or any of its Affiliates.

     “Responsible Officer” means the chief executive officer, chief operating officer, chief financial officer or chief accounting officer of the Company or any other officer of the Company involved principally in its financial administration or its controllership function.

     “Restricted Payment” means (a) the declaration or payment of any dividend on, or the making of any distribution in respect of, any Capital Stock or any Trust Preferred Security of the Company or any of its Subsidiaries, other than dividends or distributions payable solely in Capital Stock of the Company or, in the case of a Subsidiary, dividends or other payments or distributions in respect of its Capital Stock paid to the Company or a Wholly Owned Subsidiary, (b) the purchase, redemption, retirement or other acquisition, whether direct or indirect, of any Capital Stock of the Company or its Subsidiaries, or (c) the purchase, redemption, retirement or other acquisition, whether direct or indirect, of any Trust Preferred Security prior to any regularly scheduled redemption thereof; provided, that “Restricted Payment” shall not include (i) the declaration or payment of any dividend in respect of the Capital Securities; (ii) dividends or distributions in common stock of the Company; (iii) any declaration of a non-cash dividend in connection with the implementation of a stockholder’s right plan, or the issuance of stock under any such plan in the future or the redemption or repurchase of any such rights pursuant thereto; or (iv) any purchase of common stock of the Company related to rights under any of the Company’s benefit plans for its directors, officers or employees.

     “Scheduled Rate” shall have the meaning set forth in Section 3.01(a).

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     “Senior and Subordinated Debt” means the principal of (and premium, if any) and interest, if any (including interest accruing on or after the filing of any petition in bankruptcy or for reorganization relating to the Company whether or not such claim for post-petition interest is allowed in such proceeding), on Debt, whether incurred on or prior to the date of this Agreement or thereafter incurred, unless, in the instrument creating or evidencing the same or pursuant to which the same is outstanding, it is provided that such obligations are not superior in right of payment to the Subordinated Note or to other Debt which is pari passu with, or subordinated to, the Subordinated Note; provided, however, that Senior and Subordinated Debt shall not be deemed to include (i) any Debt of the Company which when incurred and without respect to any election under section 1111(b) of the United States Bankruptcy Code of 1978, as amended, was without recourse to the Company, (ii) any Debt of the Company to any of its Subsidiaries, (iii) any Debt to any employee, officer or director of the Company or any of its Subsidiaries, (iv) any Debt which by its terms is subordinated to trade accounts payable or accrued liabilities arising in the ordinary course of business to the extent that payments made to the holders of such Debt by the holders of the Subordinated Note as a result of the subordination provisions of this Agreement would be greater than they otherwise would have been as a result of any obligation of such holders to pay amounts over to the obligees on such trade accounts payable or accrued liabilities arising in the ordinary course of business as a result of subordination provisions to which such Debt is subject, (v) the Guarantee Agreement, and (vi) any Trust Preferred Securities.

     “Special Event” means a Tax Event, an Investment Company Event or a Capital Treatment Event.

     “Subordinated Note” is defined in Section 2.01.

     “Subsidiary” means, with respect to any Person, any corporation, association or other business entity in which such Person or one or more of its subsidiaries or such Person and one or more of its subsidiaries owns sufficient equity or voting interests to enable it or them (as a group) ordinarily, in the absence of contingencies, to elect a majority of the directors (or Persons performing similar functions) of such entity, and any partnership, limited liability company, joint venture or similar entity if more than a 50% interest in the profits or capital thereof is owned by such Person or one or more of its subsidiaries or such Person and one or more of its subsidiaries (unless such partnership, limited liability company, joint venture or similar entity can and does ordinarily take major business actions without the prior approval of such Person or one or more of its subsidiaries). Unless the context otherwise clearly requires, any reference to a “Subsidiary” is a reference to a Subsidiary of the Company. For the avoidance of doubt, the Trust and any other trust issuing Trust Preferred Securities shall be considered Subsidiaries to the extent and for so long as they are considered to be subsidiaries of the Company under GAAP.

     “Suspension Event” is defined in Section 5.02.

     “Tax Event” means the receipt by the Company and the Trust of an opinion of counsel, experienced in such matters and reasonably acceptable to the Required Holders, to the effect that, as a result of any amendment to, or change (including any announced prospective change) in, the laws (or any regulations thereunder) of the United States or any political subdivision or taxing authority thereof or therein, or as a result of any official administrative pronouncement or judicial decision interpreting or applying such laws or regulations, which amendment or change is effective or which pronouncement or decision is announced on or after the date of issuance of the Subordinated Note,

5

there exists a material risk that interest payable by the Company on the Subordinated Note is not, or within 90 days after the date of such opinion of counsel will not be, deductible by the Company, in whole or in part, for United States federal income tax purposes.

     “Trust” is defined in the introductory paragraph of this Agreement.

     “Trust Agreement” is defined in the introductory paragraph of this Agreement.

     “Trust Preferred Security” shall mean any trust preferred security (other than the Capital Securities and the Common Securities) that is issued by a statutory business trust and the proceeds of which are loaned by such trust to the Company on a subordinated basis.

     “Voting Stock” means, with respect to any Person, securities of any class or classes of Capital Stock in such Person entitling the holders thereof under ordinary circumstances to vote in the election of members of the board of directors (or Persons performing similar functions) of such Person (irrespective of whether at the time stock of any other class or classes shall have or might have voting power or rights by reason of the happening of any contingency).

     “Wholly Owned Subsidiary” means any Subsidiary of which 100% of the total Voting Stock is at the time owned by the Company, either directly or indirectly through ownership of one or more Wholly Owned Subsidiaries.

Article II

The Loan

Section 2.1. The Loan. Subject to the terms and conditions herein, the Trust agrees to make a subordinated loan to the Company on the date hereof in the principal amount of $10,309,278 (the “Loan”). Subject to the provisions of this Agreement relating to prepayment or acceleration of the maturity of the Loan, the Loan shall mature on November 1, 2031. The Loan shall be evidenced by a subordinated promissory note (together with all Exchange Notes issued pursuant to the Trust Agreement, collectively, the “Subordinated Note”) of the Company to the Trust, substantially in the form of Exhibit A hereto.

Section 2.2. Voluntary Prepayment Due to Occurrence of Special Event. Subject to the Company having received the prior approval of the Federal Reserve if then required under the applicable capital guidelines or policies of the Federal Reserve, if a Special Event has occurred and is continuing, the Company shall have the right upon not less than 30 days nor more than 60 days notice to the Trust to prepay the Loan, in whole but not in part (together with any accrued but unpaid interest, on any Past Due Amounts, if any, and interest at the Scheduled Rate on any Deferred Amounts, if any, on the portion being prepaid), within 90 days following the occurrence of such Special Event (the “90-Day Period”), provided that if at the time there is available to the Company the opportunity to eliminate, within the 90-Day Period, the Special Event by taking some ministerial action (“Ministerial Action”), such as filing a form or making an election, or pursuing some other similar reasonable measure which has no adverse effect on the Company, the Trust or the holders of the Capital Securities issued by the Trust, the Company shall pursue such Ministerial Action in lieu of prepayment, and, provided, further, that the Company shall have no right to prepay the Loan

6

while the Trust is pursuing any Ministerial Action pursuant to its obligations under the Trust Agreement.

Section 2.3. Optional Voluntary Prepayment Under Circumstances Other Than Special Events. Subject to the Company having received prior approval of the Federal Reserve if then required under the applicable capital guidelines or policies of the Federal Reserve, the Company shall have the right at any time on or after January 1, 2007 to prepay the Loan, in whole or in part (together with any accrued but unpaid interest on any Past Due Amounts, if any, and interest at the Scheduled Rate on any Deferred Amounts, if any on the portion being prepaid), in an amount not less than $1,000,000 in the case of a partial prepayment and in amounts in integral multiples of $100,000 in excess thereof.

Section 2.4. Other Prepayment Matters. The Company shall give notice in writing to the Trust at such times and within such period prior to the proposed date of prepayment pursuant to Section 2.2 or Section 2.3, as the case may be, as shall permit the Trust to call for an Unscheduled Redemption of Capital Securities in the amount of the proposed prepayment in accordance with the terms of the Trust Agreement. The amount of such prepayment specified in such notice will become due and payable on the date specified in such notice.

Article III

Interest

Section 3.1. Interest on the Loan.

     (a) Scheduled Interest. Except as set forth below, the Loan shall bear interest at rate equal to the prime rate of interest as last reported in the “Money Rate” section of the Wall Street Journal adjusted on the first Business Day of each month, plus seventy-five (75) basis points (the “Scheduled Rate”) from the date it is made until maturity. Such interest shall be payable on each March 31, June 30, September 30 and December 31 commencing December 31, 2001. Interest will be computed on the basis of a 360-day year and twelve 30-day months and, for any interest period that is shorter than a full calendar quarter, will be calculated on the basis of the number of days elapsed in a 360-day year of twelve 30-day months. If any date on which interest is payable on the Loan is not a Business Day, then payment of the interest due on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment in respect of any such delay), except that, if such Business Day is in the next calendar year, such payment shall be made on the immediately preceding Business Day.

     (b) Deferral Interest. In the event of a deferral of the payment of interest as provided in Section 3.2, interest shall accrue on the Deferred Amount during the deferral period at the Scheduled Rate.

Section 3.2. Deferral of Interest Payment. Notwithstanding the provisions of Section 3.1(a), so long as no Default or Event of Default has occurred and is continuing, the Company shall have the right, upon notice in writing to the Trust not less than fifteen Business Days prior to the relevant interest payment date, to elect to defer payment of interest (but not to defer any interest payable in connection with the prepayment, in whole or in part, of the Loan) until the next following interest payment date, upon which date the Company shall pay interest accrued on the Loan at the Scheduled

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Rate. Interest shall accrue on the Deferred Amount at the Scheduled Rate, until the Deferred Amount due at the end of such deferral period has been paid in full, after which time the Company may again elect to defer payments of interest, subject to the provisions of this Section 3.02. The Company may elect to defer interest on the Loan in accordance with this Section 3.02 for not more than twenty (20) consecutive interest payment dates, but in no event beyond the stated maturity date of the Subordinated Note.

Article IV

Payments

Section 4.1. Method and Date of Payment. Each payment by the Company of principal and interest on the Loan shall be made to the Trust in United States Dollars to the Payment Account (as defined in the Trust Agreement) or such other place or account as may be designated by the Trust.

Section 4.2. Set-Off. Notwithstanding anything to the contrary herein, the Company shall have the right to set-off any payment it is otherwise required to make hereunder (a “relevant payment”) with and to the extent the Company has theretofore made, or is concurrently on the date of such payment making, a corresponding payment in the same amount under the Guarantee Agreement in respect of such relevant payment.

Article V

Subordination

Section 5.1. Agreement to Subordinate. The Company covenants and agrees, and the Trust and each holder of the Subordinated Note by such holder’s acceptance thereof likewise covenants and agrees, that the Subordinated Note shall be issued subject to the provisions of this Article V, and each holder of the Subordinated Note, whether upon original issue or upon transfer or assignment thereof, accepts and agrees to be bound by such provisions.

     The payment by the Company of the principal of and interest on the Subordinated Note shall, to the extent and in the manner hereinafter set forth, be subordinated and junior in right of payment to the prior payment in full of all Senior and Subordinated Debt, whether outstanding at the date of this Agreement or thereafter incurred.

Section 5.2. Default on Senior and Subordinated Debt. In the event and during the continuation of any default by the Company in the payment of principal, premium or interest due on any Senior and Subordinated Debt of the Company or in the event that the maturity of any Senior and Subordinated Debt of the Company has been accelerated because of a default, then, in either case (any such event being herein referred to as a “Suspension Event”), no payment shall be made by the Company with respect to the principal of or interest on the Subordinated Note unless and until such default shall have been cured or waived in writing or shall have ceased to exist or such Senior and Subordinated Debt shall have been discharged or paid in full, after which the Company (subject to its right to defer the payment of interest as provided in Section 3.2) shall resume making any and all payments in respect of the Subordinated Note, including any payments that would have been required by this Agreement to be made by the Company, but for the provisions of this Section 5.2.

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     In the event that, notwithstanding the foregoing, any payment shall be received by the holder of the Subordinated Note when such payment is prohibited by the preceding paragraph of this Section 5.2, such payment shall be held in trust for the benefit of, and shall be paid over or delivered to, the holders of Senior and Subordinated Debt or their respective representatives, or to the trustee or trustees under any indenture pursuant to which any of such Senior and Subordinated Debt may have been issued, as their respective interests may appear, but only to the extent that the holders of the Senior and Subordinated Debt (or their representative or representatives or a trustee) notify such holder in writing within 90 days after such payment of the amounts then due and owing on the Senior and Subordinated Debt and only the amounts specified in such notice to such holder shall be paid to the holders of Senior and Subordinated Debt.

Section 5.3. Liquidation; Dissolution; Bankruptcy. Upon any payment by the Company or distribution of assets of the Company of any kind or character, whether in cash, property or securities, to creditors upon any dissolution or winding-up or liquidation or reorganization of the Company, whether voluntary or involuntary or in bankruptcy, insolvency, receivership or other proceedings, all amounts due upon all Senior and Subordinated Debt of the Company shall first be paid in full, or payment thereof provided for in money in accordance with its terms, before any payment is made by the Company on account of the principal or interest on the Subordinated Note; and upon any such dissolution or winding-up or liquidation or reorganization, any payment by the Company, or distribution of assets of the Company of any kind or character, whether in cash, property or securities, which the holder of the Subordinated Note would be entitled to receive from the Company, except for the provisions of this Article V, shall be paid by the Company or by any receiver, trustee in bankruptcy, liquidating trustee, agent or other Person making such payment or distribution, or by such holder if received by it, directly to the holders of Senior and Subordinated Debt of the Company (pro rata to such holders on the basis of the respective amounts of Senior and Subordinated Debt held by such holders, as calculated by the Company) or their representative or representatives, or to the trustee or trustees under any indenture pursuant to which any instruments evidencing such Senior and Subordinated Debt may have been issued, as their respective interests may appear, to the extent necessary to pay such Senior and Subordinated Debt in full, in money or money’s worth, after giving effect to any concurrent payment or distribution to or for the holders of such Senior and Subordinated Debt, before any payment or distribution is made to the holder of the Subordinated Note.

     In the event that, notwithstanding the foregoing, any payment or distribution of assets of the Company of any kind or character, whether in cash, property or securities, prohibited by the foregoing, shall be received by the holder of the Subordinated Note before all Senior and Subordinated Debt of the Company is paid in full, or provision is made for such payment in money in accordance with its terms, such payment or distribution shall, subject to Section 5.5, be held in trust for the benefit of and shall be paid over or delivered to the holders of such Senior and Subordinated Debt or their representative or representatives, or to the trustee or trustees under any indenture pursuant to which any instruments evidencing such Senior and Subordinated Debt may have been issued, and their respective interests may appear, as calculated by the Company, for application to the payment of all Senior and Subordinated Debt of the Company, as the case may be, remaining unpaid to the extent necessary to pay such Senior and Subordinated Debt in full in money in accordance with its terms, after giving effect to any concurrent payment or distribution to or for the benefit of the holders of such Senior and Subordinated Debt.

     For purposes of this Article V, the words “cash, property or securities” shall not be deemed to include equity securities of the Company as reorganized or readjusted, or securities of the

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Company or any other corporation provided for by a plan of reorganization or readjustment, the payment of which is subordinated in right of payment to all Debt of the Company issued to the holders of Senior and Subordinated Debt of the Company in the plan of reorganization or readjustment to substantially the same extent as, or to a greater extent than, the Subordinated Note is so subordinated as provided in this Article V. The consolidation of the Company with, or the merger of the Company into, another corporation or the liquidation or dissolution of the Company following the conveyance or transfer of its property as an entirety, or substantially as an entirety, to another corporation upon the terms and conditions provided for in Section 7.4 of this Agreement shall not be deemed a dissolution, winding-up, liquidation or reorganization for the purposes of this Section 5.03 if such other corporation shall, as a part of such consolidation, merger, conveyance or transfer, comply with the conditions stated in Section 7.4 of this Agreement.

     Nothing in Section 5.2 or in this Section 5.3 shall apply to or limit claims of, or payments to, the Trustees or any other Person entitled to indemnification by the Company under or pursuant to Section 8.6 of the Trust Agreement.

Section 5.4. Subrogation. Subject to the payment in full of all Senior and Subordinated Debt of the Company, the rights of the holder of the Subordinated Note shall be subrogated to the rights of the holders of such Senior and Subordinated Debt to receive payments or distributions of cash, property or securities of the Company, as the case may be, applicable to such Senior and Subordinated Debt until the principal of and interest on the Subordinated Note shall be paid in full; and, for the purposes of such subrogation, no payments or distributions to the holders of such Senior and Subordinated Debt of any cash, property or securities to which the holder of the Subordinated Note would be entitled except for the provisions of this Article V, and no payment over pursuant to the provisions of this Article V to or for the benefit of the holders of such Senior and Subordinated Debt by the holder of the Subordinated Note, shall, as between the Company, its creditors other than holders of Senior and Subordinated Debt of the Company, and the holder of the Subordinated Note, be deemed to be a payment by the Company to or on account of such Senior and Subordinated Debt. It is understood that the provisions of this Article V are and are intended solely for the purposes of defining the relative rights of the holder of the Subordinated Note, on the one hand, and the holders of such Senior and Subordinated Debt on the other hand.

     Nothing contained in this Article V or elsewhere in this Agreement or in the Subordinated Note is intended to or shall impair, as between the Company, its creditors other than the holders of Senior and Subordinated Debt of the Company, and the holder of the Subordinated Note, the obligation of the Company, which is absolute and unconditional, to pay to the holder of the Subordinated Note the principal of and interest on the Subordinated Note as and when the same shall become due and payable in accordance with their terms, or is intended to or shall affect the relative rights of the holder of the Subordinated Note and creditors of the Company, other than the holders of Senior and Subordinated Debt of the Company, nor shall anything herein or therein prevent the holder of the Subordinated Note from exercising all remedies otherwise permitted by applicable law upon default under this Agreement, subject to the rights, if any, under this Article V of the Holders of such Senior and Subordinated Debt in respect of cash, property or securities of the Company, as the case may be, received upon the exercise of any such remedy.

     Upon any payment or distribution of assets of the Company referred to in this Article V, the holder of the Subordinated Note shall be entitled to rely conclusively upon any order or decree made by any court of competent jurisdiction in which such dissolution, winding-up, liquidation or reorganization proceedings are pending, or a certificate of the receiver, trustee in bankruptcy,

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liquidation trustee, agent or other Person making such payment or distribution, delivered to the holder of the Subordinated Note, for the purposes of ascertaining the Persons entitled to participate in such distribution, the holders of Senior and Subordinated Debt and other indebtedness of the Company, as the case may be, the amount thereof or payable thereon, the amount or amounts paid or distributed thereon and all other facts pertinent thereto or to this Article V.

Section 5.5. Notice by the Company. The Company shall give prompt written notice to a Responsible Officer of the Property Trustee and the holder of the Subordinated Note of any fact known to the Company that would prohibit the making of any payment of monies in respect of the Subordinated Note pursuant to the provisions of this Article V. Notwithstanding the provisions of this Article V or any other provision of this Agreement or the Trust Agreement, the holder of the Subordinated Note shall not be charged with knowledge of the existence of any facts that would prohibit the making of any payment of monies to such holder in respect of the Subordinated Note pursuant to the provisions of this Article V, unless and until the holder of the Subordinated Note shall have received written notice thereof from the Company or a holder or holders of Senior and Subordinated Debt or from any trustee therefor; and before the receipt of any such written notice, such holder shall be entitled in all respects to assume that no such facts exist; provided, however, that if the Property Trustee shall not have received the notice provided for in this Section 5.5 at least two Business Days prior to the date upon which by the terms hereof any money may become payable for any purpose (including, without limitation, the payment of the principal of or interest on the Subordinated Note), then, anything herein contained to the contrary notwithstanding, the Property Trustee shall have full power and authority to receive such money and to make the corresponding Distribution pursuant to the Trust Agreement, and shall not be affected by any notice to the contrary that may be received by it within two Business Days prior to such date.

     The holder of the Subordinated Note, if acting in good faith, shall be entitled to rely conclusively on the delivery to it of a written notice by a Person representing himself to be a holder of Senior and Subordinated Debt of the Company (or a trustee on behalf of such holder), to establish that such notice has been given by a holder of such Senior and Subordinated Debt or a trustee on behalf of any such holder or holders. In the event that the holder of the Subordinated Note determines in good faith that further evidence is required with respect to the right of any Person as a holder of such Senior and Subordinated Debt to participate in any payment or distribution pursuant to this Article V, the holder of the Subordinated Note may request such Person to furnish evidence to the reasonable satisfaction of the holder of the Subordinated Note as to the amount of such Senior and Subordinated Debt held by such Person, the extent to which such Person is entitled to participate in such payment or distribution and any other facts pertinent to the rights of such Person under this Article V, and, if such evidence is not furnished, the holder of the Subordinated Note may defer any payment to such Person pending judicial determination as to the right of such Person to receive such payment.

Section 5.6. Rights of the Property Trustee; Holders of Senior and Subordinated Debt. The Property Trustee in its individual capacity shall be entitled to all the rights set forth in this Article V in respect of any Senior and Subordinated Debt at any time held by it, to the same extent as any other holder of Senior and Subordinated Debt, and nothing in this Agreement shall deprive the Trustee of any of its rights as such holder.

     With respect to the holders of Senior and Subordinated Debt of the Company, the Property Trustee and each other holder of the Subordinated Note undertake to perform or to observe only such of its covenants and obligations as are specifically set forth in this Article V, and no implied

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covenants or obligations with respect to the holders of such Senior and Subordinated Debt shall be read into this Agreement against the Property Trustee or any other holder of the Subordinated Note. The Property Trustee and each other holder of the Subordinated Note shall not be deemed to owe any fiduciary duty to the holders of such Senior and Subordinated Debt and, so long as it is acting in good faith, the Property Trustee or such other holder of the Subordinated Note shall not be liable to any holder of such Senior and Subordinated Debt if it shall receive or pay over or deliver to any other holders of Subordinated Note, the Company or any other Person money or assets to which any holder of such Senior and Subordinated Debt shall be entitled by virtue of this Article V or otherwise.

Section 5.7. Subordination May Not Be Impaired. No right of any present or future holder of any Senior and Subordinated Debt of the Company to enforce subordination as herein provided shall at any time in any way be prejudiced or impaired by any act or failure to act on the part of the Company or by any act or failure to act, in good faith, by any such holder, or by any noncompliance by the Company with the terms, provisions and covenants of this Agreement, regardless of any knowledge thereof that any such holder may have or otherwise be charged with.

     Without in any way limiting the generality of the foregoing paragraph, the holders of Senior and Subordinated Debt of the Company may, at any time and from time to time, without the consent of or notice to the Property Trustee or any other holder of the Subordinated Note, without incurring responsibility to the Property Trustee or to any other holder of the Subordinated Note and without impairing or releasing the subordination provided in this Article V or the obligations hereunder of the Property Trustee or any other holder of the Subordinated Note to the holders of such Senior and Subordinated Debt, do any one or more of the following: (i) change the manner, place or terms of payment or extend the time of payment of, or renew or alter, such Senior and Subordinated Debt, or otherwise amend or supplement in any manner such Senior and Subordinated Debt or any instrument evidencing the same or any agreement under which such Senior and Subordinated Debt is outstanding; (ii) sell, exchange, release or otherwise deal with any property pledged, mortgaged or otherwise securing such Senior and Subordinated Debt; (iii) release any Person liable in any manner for the collection of such Senior and Subordinated Debt; and (iv) exercise or refrain from exercising any rights against the Company and any other Person.

Article VI

Representations and Warranties

Section 6.1. Representations and Warranties. The Company represents and warrants to the Trust as follows:

     (a) Good Standing. The Company is a corporation duly organized, validly existing and in good standing under the laws of Delaware and is duly qualified as a foreign corporation in each other jurisdiction where such qualification is necessary. The Company has all requisite power and authority to own or hold under lease the properties it purports to own or hold under lease, to transact its business, to execute and deliver this Agreement, the Guarantee Agreement, the Trust Agreement, the Expense Agreement, the Subscription Agreement and the Subordinated Note and to perform its obligations under the provisions hereof and thereof.

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     (b) Authorization, etc.

     (i) This Agreement has been duly authorized by the Company, and this Agreement constitutes a valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium, or similar laws affecting enforcement of creditors’ rights generally.

     (ii) The Subordinated Note has been duly authorized by the Company and, when executed, issued and delivered in the manner provided for herein and sold to and paid for by the Trust, the Subordinated Note will constitute a valid and binding obligation of the Company and will be enforceable against the Company in accordance with its terms, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting enforcement of creditors’ rights generally.

     (c) Compliance With Laws, Other Instruments, etc. (i) The execution, delivery and performance by the Company of this Agreement, the Subscription Agreement, the Guarantee Agreement, the Trust Agreement, the Expense Agreement and the Subordinated Note will not (a) contravene, result in a breach of or constitute a default under, or result in the creation of any Lien in respect of any property of the Company or any Subsidiary under any indenture, mortgage, deed of trust, loan, purchase or credit agreement, lease, corporate charter, bylaws or other constituent documents, or any other agreement or instrument to which the Company or any Subsidiary is bound or by which the Company or any Subsidiary or any of their respective properties may be bound or affected, (b) conflict with or result in a breach of any of the terms, conditions or provisions of any order, judgment, decree, or ruling of any court, arbitrator or Governmental Authority applicable to the Company or any Subsidiary or (c) violate any provision of any statute or other rule or regulation of any Governmental Authority applicable to the Company or any Subsidiary.

     (ii) Neither the Company nor any Subsidiary is in violation or breach of or default under any indenture, mortgage, deed of trust, loan, purchase or credit agreement, lease, corporate charter or bylaws or any other agreement or instrument to which it is bound or by which its properties are bound or affected, which violation, breach or default, individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect.

     (d) Governmental Authorizations, etc. No consent, approval or authorization of, or registration, filing or declaration with, any Governmental Authority is required in connection with the execution, delivery or performance by the Company of this Agreement, the Guarantee Agreement, the Trust Agreement, the Subscription Agreement, the Expense Agreement or the Subordinated Note.

Article VII

Covenants

Section 7.1. Existence. (a) The Company will at all times preserve and keep in full force and effect the existence of the Trust as a statutory business trust under the laws of Delaware and qualify

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and maintain its qualification to do business and good standing in any jurisdiction where failure to do so would have a Material Adverse Effect. The Company will at all times preserve and keep in full force and effect all rights and franchises of the Trust, unless in the good faith judgment of the Trust, the termination of or failure to preserve and keep in full force and effect such right or franchise would not have a Material Adverse Effect. For so long as the Capital Securities remain outstanding, the Company will use its reasonable efforts (i) to cause the Trust to continue not to be treated as an association taxable as a corporation or a partnership for United States federal income tax purposes and (ii) to cause each Holder of Capital Securities to be treated as owning an individual beneficial interest in the Subordinated Note.

     (b) Except as otherwise permitted by Section 7.4, the Company will, and will cause each of its Subsidiaries to preserve and keep in full force and effect its corporate or other applicable organizational existence and all its rights and franchises, except in the case of such rights and franchises where the failure to do so could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

Section 7.2. Insurance. The Company will maintain and will cause each of its Subsidiaries to maintain, with financially sound and reputable insurers, insurance with respect to their respective Property and businesses against such casualties and contingencies, of such types, on such terms and in such amounts (including deductibles and co-insurance, if adequate reserves are maintained with respect thereto) as is customary in the case of entities of established reputations engaged in the same or a similar business and similarly situated.

Section 7.3. Taxes, Claims for Labor and Materials, Compliance with Laws. The Company will, and will cause each of its Subsidiaries to, file all tax returns required to be filed in any jurisdiction and to pay and discharge (or cause to be paid and discharged) all taxes shown to be due and payable on such returns and all other taxes imposed on them or any of their properties, assets, income or franchises, to the extent such taxes have become due and payable and before they have become delinquent and all claims for labor, material, supplies or other claims for which sums have become due and payable that have or might become a Lien on properties or assets of the Company or any Subsidiary, provided that neither the Company nor any Subsidiary need pay any such taxes or claims if (a) the amount, applica bility or validity thereof is contested by the Company or such Subsidiary on a timely basis in good faith and in appropriate proceedings, and the Company or such Subsidiary has established adequate reserves therefor on its books, to the extent required by GAAP, or (b) the nonpayment of such taxes and claims could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The Company will comply and will cause each Subsidiary to comply with all laws and ordinances to which it is subject, including without limitation, and as applicable, the Occupational Safety and Health Act of 1970, ERISA and all laws, ordinances, governmental rules and regulations relating to environmental protection in all applicable jurisdictions, unless the violation of such laws, ordinances, rules or regulations would not have a Material Adverse Effect.

Section 7.4. Limitation on Consolidations, Mergers, etc. The Company will not, and will not permit any of its Subsidiaries to, merge or consolidate with or into any Person or convey, transfer or otherwise dispose of all or substantially all of its assets to any Person, except that:

     (a) The Company may merge or consolidate with or into any other Person or convey, transfer or otherwise dispose of all or substantially all of its assets to any other

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Person; provided, that (i) the successor formed by such consolidation or the survivor of such merger or the Person that acquires by conveyance, transfer or other disposition all or substantially all of the assets of the Company, as the case may be, shall be a corporation organized and existing under the laws of a state of the United States or the United States; (ii) if the Company is not such successor or survivor, the successor, survivor or acquirer shall have expressly assumed all obligations of the Company under or with respect to the Loan, this Agreement, the Guarantee Agreement and any other agreement entered into in connection with the transactions contemplated hereby (pursuant to such agreements and instruments as shall be reasonably satisfactory to the Required Holders), and such Person shall have caused to be delivered to each Holder an opinion of independent counsel reasonably acceptable to the Required Holders, to the effect that all agreements and instruments effecting such assumption are enforceable in accordance with their terms and comply with the terms hereof; and (iii) no Default or Event of Default or Suspension Event shall exist, either prior to or immediately after giving effect to such merger, consolidation or asset conveyance, transfer or other disposition; and

     (b) any Subsidiary may merge with the Company or a Wholly Owned Subsidiary, or may convey, transfer or otherwise dispose of all or substantially all of its assets to the Company or to a Wholly Owned Subsidiary; provided, that no Default or Event of Default or Suspension Event shall exist.

Section 7.5. Limitation on Restricted Payments. The Company will not, and will not permit any Subsidiary to, directly or indirectly, declare, make or incur any liability or obligation to make any Restricted Payment if (i) a Default or Event of Default or Suspension Event has occurred and is continuing or if a Default or Event of Default or Suspension Event would result therefrom, (ii) the Company has deferred the payment of interest on the Loan pursuant to Section 3.02 and any Deferred Amount or interest thereon remains unpaid, or (iii) the Company is for any reason unwilling or unable to make a payment or payments under the Guarantee Agreement.

Section 7.6. Capital Adequacy. The Company will comply, and will cause each of its Subsidiaries to comply, with all applicable capital adequacy, minimum capital and similar requirements or guidelines (whether or not having the force of law) of the Federal Reserve, the Office of the Comptroller of the Company, the Federal Deposit Insurance Corporation and relevant state banking authorities.

Section 7.7. Ownership of the Trust. The Company agrees that it shall maintain legal and beneficial ownership of 100% of the Common Securities, free and clear of any Lien, provided, however, that any successor of the Company permitted pursuant to Section 7.4 may succeed to the Company’s ownership of the Common Securities.

Section 7.8. Financial and Business Information. The Company shall deliver in duplicate to each Holder of Capital Securities:

     (a) Quarterly Statements of the Company. As soon as practicable and in any event within 50 days after the end of each quarterly period (other than the last quarterly period) in each fiscal year, unaudited consolidated (and consolidating, if requested by such Holder) statements of income, stockholders’ equity and cash flows of the Company and its Subsidiaries for the period from the beginning of the current fiscal year to the end of such quarterly period, and an unaudited consolidated (and consolidating, if requested by such Holder) balance sheet of the Company and its Subsidiaries as at the end of such

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quarterly period, setting forth in each case in comparative form figures for the corresponding period in the preceding fiscal year, all in reasonable detail and satisfactory in form to the Required Holders and certified by an authorized financial officer of the Company, subject to changes resulting from year-end adjustments;

     (b) Annual Statements of the Company. As soon as practicable and in any event within 105 days after the end of each fiscal year, consolidated (and consolidating, if requested by such Holder) statements of income, stockholders’ equity and cash flows of the Company and its Subsidiaries for such year, and a consolidated (and consolidating, if requested by such Holder) balance sheet of the Company and its Subsidiaries as at the end of such year, setting forth in each case in comparative form corresponding consolidated figures from the preceding annual audit, all in reasonable detail and satisfactory in form to the Required Holders and, as to the consolidated statements, reported on by independent public accountants of recognized standing reasonably acceptable to the Required Holders and selected by the Company, whose report shall be without limitation as to the scope of the audit and satisfactory in substance to such Required Holders and certified (in the case of any such coordinating financial statements) by an authorized financial officer of the Company;

     (c) SEC and Other Reports. Promptly upon their becoming available, one copy of each financial statement, report, notice or proxy statement sent by either Trust or the Company to securities holders generally and of each regular or periodic report, and any registration statement or prospectus filed by the Trust, the Company or any of its Subsidiaries with any securities exchange or the Securities and Exchange Commission or any successor agency, and copies of any orders in any proceedings to which the Trust, the Company or any of its Subsidiaries is a party, issued by any Governmental Authority;

     (d) Reports of Auditors. Promptly upon receipt thereof, a copy of each other report submitted to the Company or any of its Subsidiaries by independent accountants in connection with any annual, interim or special audit or review made by them of the books of the Company or any of its Subsidiaries;

     (e) Requested Information. With reasonable promptness, such other data and information as any such Institutional Investor may reasonably request, including, without limitation, to the extent that the same may be provided to such Holder under applicable law, call reports and statements of condition with respect to the Company or any of its Subsidiaries;

     (f) Officer’s Certificates. Within the periods provided in paragraphs (a) and (b) above, a certificate of an authorized financial officer of the Company stating that such officer has reviewed the provisions of this Agreement and the Subscription Agreement and setting forth: (i) the information and computations (in sufficient detail) required in order to establish whether the Company was in compliance with the requirements of Section 7.5 of this Agreement, at the end of the period covered by the financial statements then being furnished, and (ii) whether there existed as of the date of such financial statements and whether, to the best of such officer’s knowledge, there exists on the date of the certificate or existed at any time during the period covered by such financial statements any Default or

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Event of Default or Suspension Event and, if any such condition or event existed during such period or then exists on the date of the certificate, specifying the nature and period of existence thereof and the action the Company has taken, is taking and proposes to take with respect thereto;

     (g) Accountants’ Certificates. Within the period provided in paragraph (b) above, a certificate of the accountants who render an opinion with respect to such financial statements, stating that they have reviewed this Agreement and stating further, whether in making their audit, such accountants have become aware of any Default or Event of Default or Suspension Event insofar as the terms or provisions of this Agreement pertain to or involve accounting matters or determinations, and if any such condition or event existed or then exists, specifying the nature and period of existence thereof;

     (h) Notice of Default or Event of Default or Suspension Event. Immediately upon (and in any event within three Business Days after) any Responsible Officer’s becoming aware of the existence of any condition or event which constitutes any Default or Event of Default or Suspension Event, a written notice specifying the nature and period of existence thereof and what action the Company is taking or proposes to take with respect thereto; and

     (i) Notice of Claimed Default. Immediately upon (and in any event within three Business Days after) any Responsible Officer’s becoming aware that the holder or holders of any evidences of Debt of the Company and/or one or more Subsidiaries aggregating $1,000,000 or more has or have given notice or taken any other action with respect to a claimed default, a written notice specifying the notice given or action taken by such holder or holders and the nature of the claimed default, and what action the Company is taking or proposes to take with respect thereto.

Section 7.9. Limitation on Certain Restrictive Agreements. The Company will not, and will not permit any Subsidiary to, enter into or suffer to exist any contractual obligation in connection with any Debt which obligation in any way restricts the ability of any Subsidiary (a) to make any dividends, distributions or other payments, including, without limitation, repayments of loans and advances to the Subsidiary or Subsidiaries that own the Capital Stock of such Subsidiary or (b) to transfer any of its Property to the Company or to such Subsidiary or Subsidiaries.

Article VIII

Events of Default

Section 8.1. Events of Default. An “Event of Default” shall exist if one or more of the following events shall occur and be continuing:

     (a) default in the payment of interest on the Loan for more than three Business Days after the same has become due; provided, however, that a timely deferral of any interest payment by the Company pursuant to Section 3.02 shall not constitute a default in the payment of interest; or

     (b) default in the payment of principal on the Loan when due; or

17

     (c) any Company Bankruptcy Event, any Significant Bank Subsidiary Bankruptcy Event or any Trust Bankruptcy Event; or

     (d) the making of any distributions, redemptions, purchases, acquisitions or payments in violation of the provisions of Section 7.5; or

     (e) the breach by the Company of any other covenant or obligation contained herein and such breach continues for 30 days after any Responsible Officer obtains actual knowledge thereof; or

     (f) any representation or warranty made by the Company herein, in the Trust Agreement or the Subscription Agreement by the Trust in the Subscription Agreement, in Section 7.1 of the Trust Agreement or by the Company or any of its officers in any writing furnished in connection with or pursuant to this Agreement, the Subscription Agreement or the Trust Agreement shall be false or misleading in any material respect on the date as of which made.

Section 8.2. Acceleration. (a) If an Event of Default described in clause (c) of Section 8.1 has occurred with respect to the Company or the Trust, the Loan shall automatically become immediately due and payable.

     (b) If an Event of Default described in clause (a), (b) or (d), of Section 8.1 has occurred and is continuing, the Trust may at any time, subject to the rights of the Holders under the Trust Agreement, declare the Loan to be immediately due and payable.

     Upon the Loan becoming due and payable under this Section 8.2, whether automatically or by declaration, the Loan will forthwith mature and the entire unpaid principal amount of the Loan, plus all accrued and unpaid interest thereon, shall be immediately due and payable, in each and every case without presentment, demand, protest or further notice, all of which are hereby waived.

Section 8.3. Other Remedies. (a) If any Default or Event of Default has occurred and is continuing, and irrespective of whether the Loan has become or has been or may be declared immediately due and payable under Section 8.2, the Trust may proceed to protect and enforce its rights by an action at law, suit in equity or other appropriate proceeding, whether for the specific performance of any agreement contained herein, or for an injunction against a violation of any of the terms hereof, or in aid of the exercise of any power granted hereby or by law or otherwise.

     (b) The Company expressly acknowledges that under the terms of the Trust Agreement and the Capital Securities the Holders of the outstanding Capital Securities shall have the rights and powers described in the Trust Agreement, including the right to instruct the Trust to accelerate the principal amount of the Loan and to enforce the Trust’s other rights under this Agreement.

Section 8.4. No Waivers or Election of Remedies, etc. No course of dealing and no delay on the part of the Trust or any Holder of any Capital Security in exercising any right, power or remedy shall operate as a waiver thereof or otherwise prejudice the Trust or such Holder’s rights, powers or remedies. No right, power or remedy conferred by this Agreement or by the Trust Agreement upon

18

the Trust or any such Holder shall be exclusive of any other right, power or remedy referred to herein or therein or now or hereafter available at law, in equity, by statute or otherwise.

Article IX

Miscellaneous

Section 9.1. Notices. Any notice, request or other communication required or permitted to be given hereunder shall be given in writing by delivering the same against receipt therefor by facsimile transmission (if the sender on the same day sends a confirming copy of such notice by a recognized overnight delivery service, charges prepaid), telex or by a recognized overnight delivery service (charges prepaid), addressed as follows (and if so given, shall be deemed given when sent or upon receipt of an answer-back, if sent by telex):

If to the Company or the Trust:

MetroCorp Capital Trust I
1523 8^th Street
East Moline, Illinois 61244
Facsimile No.: (390) 752-9232
Attention: General Counsel

If to the Property Trustee:

Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890-0001
Facsimile No.: (302) 651-8882
Attention: Corporate Trust Administration — MetroCorp Capital Trust I

Section 9.2. Binding Effect. The Company may not assign its rights or obligations under this Agreement. The Trust may not assign any of its rights hereunder. Subject to the foregoing, this Agreement shall be binding upon and inure to the benefit of the Company and the Trust and their respective successors by any permitted merger or consolidation or otherwise by operation of law. Any assignment by the Company or the Trust in contravention of this Section will be void.

Section 9.3. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS WITHOUT GIVING EFFECT (TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW) TO ITS PRINCIPLES OF CONFLICTS OF LAW.

Section 9.4. Counterparts. This Agreement may be executed in counterparts. Any single counterpart or set of counterparts signed, in either case, by the parties hereto shall constitute a full and original agreement for all purposes.

Section 9.5. Amendments and Waivers. This Agreement, the Subordinated Note and the Expense Agreement, may be amended or compliance herewith or therewith may be waived by an

19

instrument in writing signed by both parties; provided, however, that, so long as any of the Capital Securities remain outstanding, no such amendment or waiver shall be made, no termination of this Agreement, the Expense Agreement or the Subordinated Note shall occur, and no Default, Event of Default or compliance with any covenant under this Agreement, or the Expense Agreement, may be waived by the Trust, without the prior approval of the Required Holders, in writing or at a duly constituted meeting of such Holders, unless and until the Loan and all accrued and unpaid interest thereon shall have been paid in full; provided, further, that no such amendment or waiver shall (i) change the maturity of the Loan, reduce the principal amount thereof, reduce or extend the time of payment of interest thereon or amend or waive the provisions of Sections 7.8, 8.1 or 8.2, without the prior approval of each of the Holders of the Capital Securities then outstanding or (ii) reduce any percentage in Liquidation Preference of the Capital Securities, the Holders of which are required to consent to such amendment or waiver, without the prior written approval of each of the Holders of the Capital Securities then outstanding or (iii) amend this Agreement in connection with a distribution of Subordinated Notes pursuant to Section 9.2(b) of the Trust Agreement without the prior approval of each of the Holders of the Capital Securities then outstanding.

[SIGNATURE PAGE FOLLOWS]

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     In Witness Whereof, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized as of the day and year first above written.

Metrocorp, inc.
By:	/s/ Gary D. Andersen
	Name: Gary D. Andersen
	Title: President
Metrocorp capital trust i
By:	/s/ Gary D. Andersen
	Name: Gary D. Andersen
	Title: Administrator
By:	/s/ Julius J. Van Paemel
	Name: Julius J. Van Paemel
	Title: Administrator

21

MetroCorp, Inc.
a Delaware corporation (the “Company”)

Subordinated Promissory Note EXHIBIT A

U.S. $10,309,278 Dated: November 1, 2001

     For Value Received, the undersigned, MetroCorp, Inc., a Delaware corporation (“the Company”), hereby promises to pay to MetroCorp Capital Trust I, a statutory business trust formed under the laws of the State of Delaware (the “Trust”), or its registered assigns the principal sum of Ten Million Three Hundred Nine Thousand Two Hundred Seventy Eight Dollars and no/100 United States Dollars ($10,309,278) on November 1, 2031. The interest rate herein shall be as determined in Section 3.1 of the Subordinated Loan Agreement. The loan evidenced hereby (the “Loan”) is subject to certain rights of voluntary prepayment as specified in the Subordinated Loan Agreement.

     The Company promises to pay interest on the unpaid principal amount of the Loan from the date hereof until such principal amount is paid in full, at such interest rates, and payable at such times, as are specified in the Subordinated Loan Agreement.

     This Subordinated Promissory Note is the Subordinated Note referred to in, and is entitled to the benefits of, the Subordinated Loan Agreement dated as of even date herewith (said Subordinated Loan Agreement, as it may be amended or otherwise modified from time to time, the “Subordinated Loan Agreement”), between the Company and the Trust. The Subordinated Loan Agreement, among other things, (i) provides for the Loan to the Trust in the amount evidenced by this Subordinated Note, (ii) contains provisions for acceleration of the maturity of the unpaid principal amount of this Subordinated Note upon the occurrence of certain stated events and otherwise upon the terms and conditions therein specified and (iii) contains provisions regarding the subordination of the Loan to Senior and Subordinated Debt (as defined in the Subordinated Loan Agreement) of the Company.

     Demand, presentment, protest and notice of non-payment and protest are hereby waived by the Company.

     This Subordinated Note shall be governed by, and construed and interpreted in accordance with, the laws of the state of Illinois without giving effect (to the maximum extent permitted by applicable law) to its principles of conflicts of law.

METROCORP, INC.
By:
	Name: Gary D. Andersen
	Title: President

EX-4.3

EXHIBIT 4.3

GUARANTEE AGREEMENT

by

METROCORP, INC.

METROCORP CAPITAL TRUST I

Dated as of November 1, 2001

TABLE OF CONTENTS

	Page
Article I Definitions	1
Article II Guarantee	2
Section 2.1. Guarantee	2
Section 2.2. Waiver of Notice and Demand	2
Section 2.3. Obligations Not Affected	3
Section 2.4. Rights of Holders	4
Section 2.5. Guarantee of Payment	4
Section 2.6. Subrogation	4
Section 2.7. Independent Obligations	4
Section 2.8. Rights upon Dissolution of Guarantor	4
Article III Covenants and Subordination	5
Section 3.1. Subordination	5
Section 3.2. Pari Passu Guarantees	5
Section 3.3. Subordinated Loan Agreement Covenants	5
Article IV Termination	5
Section 4.1. Termination	5
Article V Miscellaneous	6
Section 5.1. Successors and Assigns	6
Section 5.2. Amendments	6
Section 5.3. Notices	6
Section 5.4. Benefit	7
Section 5.5. Governing Law	7

i

     GUARANTEE AGREEMENT dated as of November 1, 2001 is executed and delivered by METROCORP, INC., a Delaware corporation (the “Guarantor”) having its principal office 1523 8^th Street, East Moline, Illinois 61244, for the benefit of the Holders (as defined in the Trust Agreement, as defined below) from time to time of the Capital Securities (as defined below) of METROCORP CAPITAL TRUST I, a Delaware business trust (the “Issuer”).

Witnesseth:

     Whereas, pursuant to an Amended and Restated Trust Agreement dated as of even date herewith (the “Trust Agreement”) among the Guarantor as Depositor, the Property Trustee, the Delaware Trustee and the Administrators named therein, the Issuer is issuing $10,000,000 aggregate Liquidation Preference (as defined in the Trust Agreement) of its Floating Rate Cumulative Capital Securities (the “Capital Securities”) representing preferred undivided beneficial interests in the assets of the Issuer and having the terms set forth in the Trust Agreement;

     Whereas, the Capital Securities will be issued by the Issuer and the proceeds thereof, together with the proceeds from the issuance of the Issuer’s Common Securities (as defined in the Trust Agreement), will be used to purchase the Subordinated Note (as defined herein) of the Guarantor, which will be deposited with Wilmington Trust Company, as Property Trustee under the Trust Agreement, as trust assets; and

     Whereas, to induce the Holders of the Capital Securities to purchase the Capital Securities, the Guarantor desires irrevocably and unconditionally to agree, to the extent set forth herein, to guarantee the payment and performance by the Issuer of the Guaranteed Payments (as defined herein) and to make certain other payments on the terms and conditions set forth herein;

     Now, Therefore, in consideration of the purchase by each Holder of the Capital Securities, which purchase the Guarantor hereby agrees shall benefit the Guarantor, the Guarantor executes and delivers this Guarantee Agreement for the benefit of the Holders from time to time of the Capital Securities:

Article I
Definitions

     As used in this Guarantee Agreement, the terms set forth below shall, unless the context otherwise requires, have the following meanings:

     “Guaranteed Payments” means the following payments or distributions due and payable by the Issuer with respect to the Capital Securities if and to the extent such payments are not fully and timely made by or on behalf of the Issuer: (i) any accumulated and unpaid Distributions (as defined in the Trust Agreement) required to be paid on the Capital Securities, to the extent the Issuer shall have funds on hand available therefor at such time, (ii) the redemption amount, including all accumulated and unpaid Distributions to the date of

1

redemption (the “Redemption Amount”), with respect to any Capital Securities required to be redeemed or called for redemption by the Issuer, to the extent the Issuer shall have funds on hand available therefor at such time, and (iii) upon a voluntary or involuntary termination, winding up or liquidation of the Issuer, the lesser of (a) the aggregate of the then applicable Liquidation Preference per Capital Security plus accumulated and unpaid Distributions on the Capital Securities to the date of payment, to the extent that the Issuer shall have funds available therefor at such time and (b) the amount of assets of the Issuer remaining available for distribution to Holders in liquidation of the Issuer (in either case, the “Liquidation Distribution”). The payments and distributions described in clauses (i) and (ii) above shall include, without limitation, payments and distributions, at the then applicable rate or rates provided in the Trust Agreement, scheduled to be made after the occurrence of a Bankruptcy Event with respect to the Trust, whether or not a claim for post-filing or post-petition interest or a similar claim would be allowed in any proceeding with respect to such Bankruptcy Event.

     “Subordinated Loan Agreement” means the Subordinated Loan Agreement dated as of even date herewith between the Guarantor and the Issuer.

     “Subordinated Note” means the Subordinated Promissory Note due November 1, 2031 issued by the Guarantor pursuant to the Subordinated Loan Agreement, or any instrument issued in replacement thereof.

Capitalized and other defined terms used but not otherwise defined herein shall have the meanings assigned to such terms in the Trust Agreement as in effect on the date hereof.

Article II
Guarantee

Section 2.1. Guarantee. The Guarantor irrevocably, absolutely and unconditionally agrees to pay in full to the Holders of the Capital Securities the Guaranteed Payments (without duplication of amounts theretofore paid by or on behalf of the Issuer), as and when due, regardless of any defense, right of set-off or counterclaim which the Issuer may have or assert. The Guarantor=s obligation to make a Guaranteed Payment may be satisfied by direct payment of the required amounts by the Guarantor to the Holders of the Capital Securities or by causing the Issuer to pay such amounts to such Holders.

Section 2.2. Waiver of Notice and Demand. The Guarantor hereby waives notice of acceptance of this Guarantee Agreement and of any liability to which it applies or may apply, presentment, demand for payment, any right to require a proceeding first against the Issuer or any other Person before proceeding against the Guarantor, protest, notice of nonpayment, notice of dishonor, notice of redemption and all other notices and demands.

2

Section 2.3. Obligations Not Affected. The obligations, covenants, agreements and duties of the Guarantor under this Guarantee Agreement shall in no way be affected or impaired by reason of the happening from time to time of any of the following:

     (a) the release or waiver, by operation of law or otherwise, of the performance or observance by the Issuer of any express or implied agreement, covenant, term or condition relating to the Capital Securities (or any document relating thereto) to be performed or observed by the Issuer;

     (b) the extension of time for the payment by the Issuer of all or any portion of the Distributions, Redemption Amount, Liquidation Distribution or any other sums payable under the terms of the Capital Securities or the extension of time for the performance of any other obligation under, arising out of, or in connection with, the Capital Securities;

     (c) any failure, omission, delay or lack of diligence on the part of the Holders of the Capital Securities to enforce, assert or exercise any right, privilege, power or remedy conferred on such Holders pursuant to the terms of the Capital Securities (or any document relating thereto), or any action on the part of such Holders granting indulgence or extension of any kind;

     (d) the voluntary or involuntary liquidation, dissolution, sale of any collateral, receivership, insolvency, bankruptcy, assignment for the benefit of creditors, reorganization, arrangement, composition or readjustment of debt of, or other similar proceedings affecting, the Issuer or any of the assets of the Issuer;

     (e) any invalidity of, or defect or deficiency in, the Capital Securities (or any document relating thereto);

     (f) the settlement or compromise of any obligation guaranteed hereby or hereby incurred;

     (g) any lack or limitation of the status, power, incapacity or disability of the Issuer or any trustee or agent thereof; or

     (h) any other circumstances whatsoever that might otherwise constitute a legal or equitable discharge or defense of a guarantor, it being the intent of this Section 2.3 that the obligations of the Guarantor hereunder shall be absolute and unconditional under any and all circumstances.

There shall be no obligation of the Holders of the Capital Securities to give notice to, or obtain the

3

consent of, the Guarantor with respect to the happening of any of the foregoing.

Section 2.4. Rights of Holders. The Guarantor expressly acknowledges that any Holder of the Capital Securities may institute a legal proceeding directly against the Guarantor to enforce its rights under this Guarantee Agreement without first instituting a legal proceeding against the Issuer or any other Person.

Section 2.5. Guarantee of Payment. This Guarantee Agreement creates a guarantee of payment and not of collection. This Guarantee Agreement will not be discharged except by payment of the Guaranteed Payments in full (without duplication of amounts theretofore paid by the Issuer).

Section 2.6. Subrogation. The Guarantor shall be subrogated to all (if any) rights of the Holders of the Capital Securities against the Issuer in respect of any amounts paid to such Holders by the Guarantor under this Guarantee Agreement; provided, however, that the Guarantor shall not (except to the extent required by mandatory provisions of law) be entitled to enforce or exercise any rights which it may acquire by way of subrogation or any indemnity, reimbursement or other agreement, in all cases as a result of payment under this Guarantee Agreement, unless and until the Guaranteed Payments have been indefeasibly paid in full. If any amount shall be paid to the Guarantor in violation of the preceding sentence, the Guarantor agrees to hold such amount in trust for the Holders of the Capital Securities and to pay over such amount to such Holders.

Section 2.7. Independent Obligations. The Guarantor acknowledges that its obligations hereunder are independent of the obligations of the Issuer with respect to the Capital Securities and that the Guarantor shall be liable as principal and as debtor hereunder to make Guaranteed Payments pursuant to the terms of this Guarantee Agreement notwithstanding the occurrence of any event referred to in subsections (a) through (h), inclusive, of Section 2.3 hereof.

Section 2.8. Rights upon Dissolution of Guarantor. In the event of any Bankruptcy Event (as defined in the Trust Agreement) of the Guarantor, each Holder of a Capital Security shall be entitled to obtain payment under this Guarantee, subject to the provisions of Article III, in respect of an amount equal to the full Liquidation Preference of such Capital Security (to the extent not previously paid by the Issuer or by the Guarantor) irrespective of the existence of any similar such case, proceeding, dissolution, liquidation or other winding up or event in respect of the Issuer or the existence of sufficient legally available funds and cash of the Issuer to pay such Liquidation Preference. The consolidation of the Guarantor with, or the merger of the Guarantor into, another Person or the liquidation or dissolution of the Guarantor following conveyance or transfer of its properties and assets substantially as an entirety to another Person upon the terms and conditions set forth in Section 7.04 of the Subordinated Loan Agreement shall not be deemed a Bankruptcy Event of the Guarantor for the purposes of this Section if the person formed by such consolidation or into which the Guarantor is merged or that acquired by conveyance or transfer such properties and assets substantially as an entirety, as the case may be, shall, as a part of such consolidation, merger,

4

conveyance or transfer, comply with the conditions set forth in such Section 7.04.

Article III
Covenants and Subordination

Section 3.1. Subordination. The rights of the Holders hereunder shall be subordinated to all Senior and Subordinated Debt (as defined in the Subordinated Loan Agreement) in the same manner and on the same terms, and shall rank pari passu with the rights of the Trust, as set forth in Article V of the Subordinated Loan Agreement.

Section 3.2. Pari Passu Guarantees. The obligations of the Guarantor under this Guarantee Agreement shall rank pari passu with the obligations of the Guarantor under any similar guarantee agreements issued by the Guarantor on behalf of the holders of securities similar to the Capital Securities and issued by any statutory business trust or similar entity established by the Guarantor.

Section 3.3. Subordinated Loan Agreement Covenants. The Guarantor agrees that the covenants made in Article VII of the Subordinated Loan Agreement have been made for the benefit of the Holders of the Capital Securities and such covenants shall be incorporated herein as if fully stated herein.

Article IV
Termination

Section 4.1. Termination. This Guarantee Agreement shall terminate and be of no further force and effect upon (i) the date on which full payment has been made of all amounts payable to all Holders of the Capital Securities (whether upon redemption, liquidation, exchange or otherwise) and no Capital Securities remain outstanding or (ii) termination of the Trust as provided in Section 9.3 of the Trust Agreement. Notwithstanding the foregoing, this Guarantee Agreement will continue to be effective or will be reinstated, as the case may be, if at any time any Holder of the Capital Securities must restore, return or repay payment of any sums paid with respect to Capital Securities or this Guarantee Agreement.

5

Article V
Miscellaneous

Section 5.1. Successors and Assigns. All guarantees and agreements contained in this Guarantee Agreement shall bind the successors, assigns, receivers, trustees and representatives of the Guarantor and shall inure to the benefit of the Holders of the Capital Securities. Except in connection with a consolidation, merger or sale involving the Guarantor that is permitted under Section 7.04 of the Subordinated Loan Agreement and pursuant to which the successor or assignee agrees in writing to perform the Guarantor’s obligations hereunder, the Guarantor shall not assign its obligations hereunder. References in this Guarantee Agreement to “Holders of the Capital Securities” shall be deemed to refer to such Holders at the relevant time.

Section 5.2. Amendments. This Guarantee Agreement may only be amended, or performance hereunder by the Guarantor waived, with the prior approval of the Holders of not less than a majority of the Liquidation Preference of the Capital Securities.

Section 5.3. Notices. Any notice, request or other communication required or permitted to be given hereunder shall be in writing, duly signed by the party giving such notice, and delivered, telecopied (if the sender on the same day sends a confirming copy of such notice by a recognized overnight delivery service, charges prepaid) or sent by a recognized overnight delivery service (charges prepaid) as follows:

     (a) if given to the Guarantor, to the address set forth below or such other address, facsimile number or to the attention of such other Person as the Guarantor may give notice to the Holders:

MetroCorp, Inc.
1523 8^th Street
East Moline, Illinois 61244
Facsimile No.:(390) 752-9232
Attention: General Counsel

     (b) if given to the Issuer, at the Issuer’s address set forth below or such other address as the Issuer may give notice to the Holders:

MetroCorp Capital Trust I
1523 8^th Street
East Moline, Illinois 61244
Facsimile No.:(390) 752-9232
Attention: General Counsel

6

with a copy to:

Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890-0001
Facsimile No.: (302) 651-8882
Attention: Corporate Trust Administration — MetroCorp Capital Trust I

     (c) if given to any Holder, at the address set forth on the Securities Register.

     All notices hereunder shall be deemed to have been given when received in person, telecopied (if the sender on the same day sends a confirming copy of such notice by a recognized overnight delivery service, charges prepaid), or sent by a recognized overnight delivery service (charges prepaid), except that if a notice or other document is refused delivery or cannot be delivered because of a changed address of which no notice was given, such notice or other document shall be deemed to have been delivered on the date of such refusal or inability to deliver.

Section 5.4. Benefit. This Guarantee Agreement is solely for the benefit of the Holders and is not separately transferable from the Capital Securities.

Section 5.5. Governing Law. This Guarantee Agreement shall be governed by and construed and interpreted in accordance with the laws of the State of Illinois (without regard to conflict of laws principles.)

[Remainder of Page Intentionally Left Blank; Signature Page Follows]

7

     In Witness Whereof, the undersigned has executed this Guarantee Agreement as of the date first above written.

METROCORP, INC.
By:	/s/ Gary D. Andersen
	Name: Gary Andersen Title: President

8

EX-4.4

EXHIBIT 4.4

THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED UNLESS (A) COVERED BY AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) THE CORPORATION HAS BEEN FURNISHED WITH AN OPINION OF COUNSEL ACCEPTABLE TO THE CORPORATION TO THE EFFECT THAT NO REGISTRATION IS LEGALLY REQUIRED FOR SUCH TRANSFER.

Certificate Number Number of Capital Securities

     P-

Certificate Evidencing Capital Securities

of

MetroCorp Capital Trust I

Floating Rate Cumulative Capital Securities

(Initial Liquidation Preference $1,000 per Capital Security)

     MetroCorp Capital Trust I, a business trust created under the laws of the State of Delaware (the “Trust”), hereby certifies that ______(the “Holder”) is the registered owner of _________(___) Floating Rate Cumulative Capital Securities (Initial Liquidation Preference $1,000 per Capital Security) of the Trust, representing undivided beneficial interests in the assets of the Trust (the “Capital Securities”). The Capital Securities are transferable on the books and records of the Trust, in person or by a duly authorized attorney, upon surrender of this certificate duly endorsed and in proper form for transfer as provided in Section 5.4 of the Trust Agreement (as defined below). The designations, rights, privileges, restrictions, preferences and other terms and provisions of the Capital Securities are set forth in, and this certificate and the Capital Securities represented hereby as issued and shall in all respects be subject to the terms and provisions of, the Amended and Restated Trust Agreement of the Trust, dated as of November 1, 2001, as the same may be amended further from time to time (the “Trust Agreement”), including the designation of the terms of Capital Securities as set forth therein. The Holder is entitled to the benefits of the Guarantee Agreement entered into by MetroCorp, Inc., a Delaware corporation (the “Depositor”), dated as of November 1, 2001 (the “Guarantee”), to the extent provided therein. The Trust will furnish a copy of the Trust Agreement and the Guarantee Agreement to the Holder without charge upon written request to the Trust as its principal place of business or registered office.

EXHIBIT 4.4

     By receipt and acceptance of this certificate, the Holder agrees to be bound by the Trust Agreement and is entitled to the benefits thereunder. The Holder will also be deemed, by its receipt and acceptance of this certificate, to have made the representation set forth in Section 2.1 of the Subscription Agreement (as defined in the Trust Agreement) on the date of its purchase of this certificate.

     THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST THEREIN BY OR ON BEHALF OF A HOLDER OR ANY OTHER PERSON HAVING A BENEFICIAL INTEREST THEREIN, WITHOUT ANY SIGNATURE OR FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL ACCEPTANCE BY THE HOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN SUCH TRUST SECURITY OF ALL THE TERMS AND PROVISIONS OF THE TRUST AGREEMENT AND AGREEMENT TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AGREEMENT AND THE SUBORDINATED LOAN AGREEMENT, AND SHALL CONSTITUTE THE AGREEMENT OF THE TRUST, SUCH HOLDER AND SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE TRUST AND SUCH HOLDER AND SUCH OTHERS.

     IN WITNESS WHEREOF, the undersigned Administrator of the Trust has executed this certificate as of the___ day of ______, 20___.

METROCORP CAPITAL TRUST I
By:
	Name: Gary D. Andersen
	Title: Administrator
By:
	Name: Julius J. Van Paemel
	Title: Administrator

EXHIBIT 4.4

ASSIGNMENT

     FOR VALUE RECEIVED, the undersigned assigns and transfers this Capital Securities Certificate to:

(Insert assignee’s social security or tax identification number)

(Insert address and zip code of assignee)

and irrevocably appoints:

agent to transfer this Capital Securities Certificate on the books of the Trust. The agent may substitute another to act for him or her.

Date:

Signature:

(Sign exactly as your name appears on the other side
of this Capital Securities Certificate)

The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to S.E.C. Rule 17Ad-15.

EX-10.1

EXHIBIT 10.1

INDEMNIFICATION AGREEMENT

     This INDEMNIFICATION AGREEMENT is made and entered into as of the ___day of September 2005, by and between Metrocorp, Inc., an Illinois corporation (“Metrocorp”), and            , a member of Metrocorp’s Board of Directors (the “Director”).

     WHEREAS, Metrocorp and the Director each recognize the ongoing and substantial risk of litigation and other claims being asserted against directors of public companies; and

     WHEREAS, in recognition of the need for protection against such litigation and claims to facilitate the Director’s continued effective service to Metrocorp, Metrocorp desires to provide for the indemnification, advancement, reimbursement and insurance of certain liabilities and expenses of the Director, to the full extent permitted by law;

     NOW, THEREFORE, in consideration of these premises and of the Director’s continuation of service to Metrocorp, the parties hereto agree as follows:

     1. Indemnification Against Liability. The Director shall be indemnified and held harmless by Metrocorp, to the full extent permitted by law, against any and all liabilities and assessments arising out of or related to any threatened, pending or completed action, suit, proceeding, inquiry or investigation, whether civil, criminal, administrative, or other (each being hereinafter referred to as an “Action”), including, but not limited to, judgments, fines, penalties and amounts paid in settlement (whether with or without court approval), and any interest, assessments, excise taxes or other charges paid or payable in connection with or in respect of any of the foregoing (each such liability and assessment being hereinafter referred to as a “Liability”), incurred by the Director and arising out of his or her status as a director or member of a committee of the Board of Directors of Metrocorp, or by reason of anything done or not done by the Director in such capacities.

     2. Indemnification Against Expense. The Director shall also be indemnified and held harmless by Metrocorp, to the full extent permitted by law, against any and all attorneys’ fees and other costs, expenses and obligations, and any interest, assessments, excise taxes or other charges paid or payable in connection with or in respect of any of the foregoing (each such expense being hereinafter referred to as an “Expense”) arising out of or relating to any Action, including expenses incurred by a Director:

          (a) in connection with investigating, defending, being a witness or participating in any Action (other than an Action commenced by the Director against another party, except as provided in Section 2(b) below) or any appeal of an Action; or

          (b) in connection with any claim asserted or action brought by the Director for (i) payment or indemnification of Liabilities or Expenses or advance payment of Expenses by Metrocorp under this Agreement, or pursuant to any other agreement, any resolution of Metrocorp’s stockholders or Board of Directors, any provision of Metrocorp’s Articles of Incorporation or Bylaws, or any statute or rule of law providing for indemnification, now or hereafter in effect, relating to any Action, or for specific performance pursuant to Section 17

hereof, and/or (ii) recovery under any directors’ and officers’ liability insurance policy or policies maintained by Metrocorp, regardless of whether the Director is ultimately determined to be entitled to such payment, indemnification, advance, or insurance recovery, as the case may be.

     3. Partial Indemnification. If the Director is entitled under this Agreement to payment for some or a portion of any Liability or Expense relating to an Action, but not for the total amount thereof, Metrocorp shall nevertheless pay the Director for the portion thereof to which he or she is entitled.

     4. Advances. Metrocorp shall pay any and all Expenses incurred by the Director in connection with any Action, whether or not the Action has been finally disposed of (an “Advance”), within five days after receipt by Metrocorp of an appropriate request therefor from the Director, provided that Metrocorp shall have received a Statement of Undertaking, in substantially the form set forth in Exhibit A (“Statement of Undertaking”), undertaking by or on behalf of the Director to repay such Advance if it is ultimately determined that the Director is not entitled to be indemnified by Metrocorp against such Expenses.

     5. Demand and Final Payment. Final payments of Liabilities and Expenses provided for herein shall be made by Metrocorp upon the receipt of a written request therefor by or on behalf of the Director, and upon the determination that indemnification is proper in the circumstances because the Director met the applicable standard of conduct set forth in this Indemnification Agreement. Such determination shall be made (i) by a majority vote of the Metrocorp directors who are not parties to the Action giving rise to the demand (the “Disinterested Directors”) even though less than a quorum, or (ii) by a committee of such Disinterested Directors designated by majority vote of the Disinterested Directors, even though less than a quorum, or (iii) if the Disinterested Directors so direct, or if there are no Disinterested Directors, by independent legal counsel in a written opinion, or (iv) by majority vote of Metrocorp’s stockholders. The Director may contest a determination that he or she is not entitled to indemnification by petitioning a court to make an independent determination with respect to the Director’s right to indemnification hereunder.

     6. Failure to Indemnify. If a claim for payment of any Liability, Expense or Advance under this Agreement, or pursuant to any other agreement, any resolution of Metrocorp’s stockholders or Board of Directors, any provision of Metrocorp’s Articles of Incorporation or Bylaws, or any statute or rule of law providing for indemnification, now or hereafter in effect, is not paid in full within thirty days, in the case of Liabilities and Expenses, or within five days, in the case of Advances, after a written request for payment thereof has been received by Metrocorp, the Director may bring an action against Metrocorp to recover the unpaid amount of such claim, together with interest thereon. It shall be a defense to any such claim (other than an action brought to enforce a claim for an Advance) that the Director has not met the standard of conduct which makes it permissible under this Indemnification Agreement for Metrocorp to indemnify the Director for the amount claimed, provided, however, that the burden of proving such defense shall be on Metrocorp and the Director shall be entitled to receive Advances pursuant to Section 4 hereof unless and until such defense shall be finally adjudicated by a court.

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     7. Presumption. For purposes of this Agreement, the termination of any Action by judgment, order, settlement (whether with or without court approval) or conviction, or upon a plea of nolo contendere, or its equivalent, shall not create a presumption that the Director has not met any particular standard of conduct required for payment under this Agreement.

     8. Change in Control. If there is a Change in Control (as defined below) of Metrocorp, then the acquiring or successor Person (as defined below), as the case may be (the “Successor”), shall not diminish or limit in any manner the indemnification rights available to the Director immediately prior to such Change in Control, whether such rights were available under this Agreement, or pursuant to any other agreement, any resolution of Metrocorp’s stockholders or Board of Directors, any provision of Metrocorp’s Articles of Incorporation or Bylaws, or any statute or rule of law providing for indemnification, now or hereafter in effect. No such Successor shall cancel, limit or in any way diminish the rights or coverage provided to the Director pursuant to one or more directors’ and officers’ insurance policies carried by Metrocorp immediately prior to any such Change in Control. For the purposes of this Agreement, the term “Change in Control” shall mean (i) the acquisition by any person or entity, or any group of persons or entities acting in concert (a “Person”) of direct or indirect beneficial ownership of 40% or more of the voting power or voting securities of Metrocorp, (ii) the acquisition by any Person of direct or indirect beneficial ownership of 25% or more of the voting power or voting securities of Metrocorp and the subsequent election of a majority of the members of Metrocorp’s Board of Directors who were not members of the Board for the two-year period immediately preceding their election, (iii) a transfer of all or substantially all of Metrocorp’s assets to another Person who is not a wholly owned subsidiary of Metrocorp, or (iv) merger or consolidation of Metrocorp with another corporation where, as a result of such merger and consolidation, less than 60% of the outstanding voting securities of the surviving or resulting corporation shall then be owned by the stockholders of Metrocorp immediately prior to such merger or consolidation.

     9. Director’s Obligations. The Director shall promptly notify Metrocorp in writing of the institution of any Action which may be the subject of this Agreement and shall keep Metrocorp generally informed of any such Action. Notices to Metrocorp shall be directed to Metrocorp, Inc., 1523 8th Street, East Moline, IL 61244, Attention: Secretary (or to such other address as Metrocorp may notify the Director in writing). Notice shall be deemed received three business days after the date postmarked and shall be sent by certified or registered mail, properly addressed. In addition, the Director shall give Metrocorp such information and cooperation as Metrocorp shall reasonably require and as shall be in the Director’s power.

     10. Termination. This Agreement may not be terminated except by a writing to that effect executed by the parties hereto. This Agreement shall continue in effect regardless of whether the Director continues to serve as a director of Metrocorp.

     11. Contract Rights Not Exclusive. The rights of the Director hereunder shall be in addition to, but not exclusive of, any other right which the Director may have pursuant to any other agreement, any resolution of Metrocorp’s stockholders or Board of Directors, any provision of Metrocorp’s Articles of Incorporation or Bylaws, or any statute or rule of law providing for indemnification, now or hereafter in effect.

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     12. Insurance. The rights of the Director hereunder shall also be in addition to any rights the Director may now or hereafter have under policies of insurance maintained by Metrocorp or otherwise. Metrocorp may purchase and maintain insurance on behalf of its directors against any liability asserted against or incurred by them, whether or not Metrocorp would have the power to indemnify them against such liability, and the Director shall be covered by such policy or policies to the maximum extent of the coverage available for any director of Metrocorp.

     13. Subrogation. In the event of any payment under this Agreement, Metrocorp shall be subrogated to the extent of such payment to all of the rights of recovery of the Director, who shall execute all papers required and shall do everything that may be necessary to secure such rights, including the execution of such documents as may be necessary to enable Metrocorp effectively to bring suit to enforce such rights.

     14. No Duplication of Payments. Metrocorp shall not be liable under this Agreement to make any payment in connection with any claim made against the Director to the extent the Director has actually received payment of the amounts otherwise payable hereunder.

     15. Modification and Waiver. No supplement, modification or amendment of any of the provisions of this Agreement and no consent by either party hereto to any departure therefrom by the other party hereto shall be binding unless executed in writing by both of the parties hereto. No waiver of any provision of this Agreement shall be deemed or shall constitute a waiver of any other provisions hereof (whether or not similar) nor shall any such waiver constitute a continuing waiver.

     16. Binding Effect. This Agreement shall be binding upon and inure to the benefit of and be enforceable by the parties hereto and their respective successors and assigns (including any direct or indirect successor by purchase, merger, consolidation or otherwise to all or substantially all of the business and/or assets of Metrocorp) and spouses, heirs and personal and legal representatives.

     17. Specific Performance. The failure of Metrocorp to perform any of its obligations hereunder shall entitle the Director, as a matter of course, to request an injunction from any court of competent jurisdiction to enforce such obligations. Such right to request specific performance shall be cumulative and in addition to any other rights and remedies to which the Director shall be entitled.

     18. Severability. If any provision or provisions of this Agreement, or any portion of any provision hereof, shall be deemed invalid or unenforceable pursuant to a final determination of any court of competent jurisdiction or as a result of future legislative action, such determination or action shall be construed so as not to affect the validity or enforceability hereof, and the remaining provisions, and portions thereof, shall be enforceable to the fullest extent permitted by law.

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     19. Amendments to Laws. This Agreement is intended to provide indemnification and advancement of expenses to Director to the fullest extent allowed under any applicable law, the Articles of Incorporation and the Bylaws of Metrocorp. Accordingly, to the extent permitted by law, if the applicable law, the Articles of Incorporation or the Bylaws of Metrocorp permit greater indemnification or advancement of expenses than the indemnification and advancement of expenses set forth herein, or if any amendment is made to any applicable law, the Articles of Incorporation or the Bylaws of the Company expanding the indemnity permissible, the indemnification or advancement of expenses obligations, as the case may be, contained herein automatically shall be expanded, without the necessity of action on the part of any party, to the extent necessary to provide to Director the fullest indemnification or advancement of expenses, as the case may be, permissible under any applicable law, the Articles of Incorporation or the Bylaws of Metrocorp.

     20. Governing Law. This Agreement shall be governed by and construed in accordance with the substantive laws of the State of Illinois.

     IN WITNESS WHEREOF, the parties hereto have entered into this Agreement as of the day and year first above written.

METROCORP:

METROCORP, INC.,

an Illinois corporation

By:

Name:

Title:

DIRECTOR:

Name:

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EXHIBIT A

STATEMENT OF UNDERTAKING

STATE OF

COUNTY OF

     I,                                                             , being first duly sworn, depose and say as follows:

     1. This Statement of Undertaking is submitted pursuant to the Indemnification Agreement dated                                         , 2005, between Metrocorp, Inc., an Illinois corporation (“Company”), and me.

     2. I am requesting the advancement of certain expenses which I have incurred in connection with an Action.

     3. I hereby undertake to repay this advancement of expenses if it is ultimately determined that I am not entitled to be indemnified by the Company.

     4. I am requesting the advancement of expenses in connection with the following Action:                                            .

     I have executed this Statement of Undertaking on                                                             .

Signature

Print Name

     Subscribed and sworn to before me on                                         .

Notary Public in and for

     said state and county

My commission expires:                                                                                                                      

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EX-10.2

EXHIBIT 10.2

INCENTIVE BONUS AGREEMENT

     This Incentive Bonus Agreement (“Agreement”) is effective as of the ___ day of October 2005 (the “Effective Date”), by and between Metrocorp, Inc., an Illinois corporation (the “Company”) and                                          (“Employee”).

     WHEREAS, Employee is employed by the Company;

     WHEREAS, as part of the Board’s recent decision to explore all of the strategic alternatives available to the Company, the Company is in the process of exploring opportunities for the sale of the Company;

     WHEREAS, the Board of Directors of the Company (the “Board”) has determined that Employee is a “key employee” of the Company and that it is in the best interests of the Company and its stockholders to assure that the Employee will remain employed by the Company and that the Company will have the continued dedication of Employee, notwithstanding the possibility or occurrence of a sale of the Company;

     WHEREAS, the Board believes it is imperative (i) to diminish the inevitable and significant distractions of Employee and dilution of the time of Employee, by virtue of the personal uncertainties and risks created by a planned or pending sale of the Company; (ii) to encourage Employee’s full attention and dedication to the Company currently and in the event of any planned or pending sale of the Company; and (iii) to provide Employee with compensation arrangements in the event of a sale of the Company; and

     WHEREAS, in order to accomplish the objectives described in the preceding recitals, the Board desires to cause the Company to enter into this Agreement as set forth herein.

     NOW, THEREFORE, in consideration of the premises, the mutual covenants and agreements contained in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and Employee hereby agree as follows:

     1. Term. Except as otherwise set forth herein, the term of this Agreement (“Term”) shall commence on the Effective Date and shall continue for an initial period ending on the first anniversary of the Effective Date, provided however, if a Bonus Event (as defined herein) is pending prior to the end of the Term, the Term shall continue until the Bonus Event occurs or there is no Bonus Event pending. For purposes of this Agreement, a Bonus Event shall be considered pending only if there is a signed letter of intent or definitive agreement in place, with respect to such Bonus Event.

     2. Obligations of Company in the Event of a Bonus Event.

     (a) Retention Bonus. Upon the occurrence of a Bonus Event during the Term, if Employee has remained in continuous employment with the Company during the Term, then the Company shall pay to Employee a “Retention Bonus” in the amount of twenty percent (20%) of Employee’s annual base salary in effect on the Effective Date, less applicable taxes.

     (b) Company Obligation to Pay Bonuses. Any bonus payable pursuant to this Section 2 shall be in addition to all other salary, benefits and other amounts accrued to, vested in or earned by Employee upon the occurrence of the Bonus Event. No such bonus under to this Section 2 shall be paid if a Bonus Event does not occur, or upon the voluntary termination by Employee of Employee’s employment with the Company, Employee’s death or disability, or the termination by the Company of Employee’s employment for unsatisfactory job performance, whether or not a Bonus Event is then pending.

    3. Definitions. The term “Bonus Event” shall mean (i) merger or consolidation of the Company with another corporation where, as a result of such merger or consolidation, less than 75% of the outstanding voting securities of the surviving or resulting corporation shall then be owned by the stockholders of the Company immediately prior to such merger or consolidation; or (ii) a transfer of all or substantially all of the Company’s assets to another entity that is not a wholly-owned subsidiary of the Company.

    4. Time of Payment. Any payment due under this Agreement shall be made within ten (10) days following the date of the Bonus Event.

    5. At Will-Employment. Nothing in this Agreement is intended to change or affect Employee’s status as an at-will employee or is intended to guaranty employment to Employee either before or after a Bonus Event. The Company shall continue to have the right to terminate Employee’s employment with or without cause subject to its obligation to make certain payments to Employee on the terms and conditions otherwise provided for in this Agreement, and to applicable law.

    6. Confidentiality. As a material inducement to Company to enter this Agreement, Employee covenants and agrees that Employee will not disclose to any third-party (including employees of the Company other than the President of the Company) the nature, character, content or existence of this Agreement, without the prior written consent of the Company, which consent may be withheld in its sole discretion. Notwithstanding the foregoing, Employee may disclose the nature, character, content or existence of this Agreement or its terms (a) to the Employee’s spouse; or (b) to the Employee’s legal and financial advisors, so long as such third parties agree to keep confidential and not disclose the existence or terms of this Agreement. Additionally, Employee may disclose the nature, character, content or existence of this Agreement or its terms to the extent required by process of law. If Employee shall breach this Section 6, Company shall have the right to immediately terminate this Agreement by giving written notice of such termination to Employee and to further pursue all rights and remedies available to the Company at law or equity with respect to such breach.

    7. General Terms.

(a) Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the state of Illinois.

     (b) Assignability. This Agreement is personal to Employee and without the prior written consent of the Company shall not be assignable by Employee other than by

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will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by Employee’s legal representatives and heirs. This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns.

     (c) Withholding. The Company may withhold from any amounts payable under this Agreement such federal, state or local taxes as shall be required to be withheld pursuant to any applicable law or regulation.

     (d) Amendment. Except as may be otherwise provided herein, this Agreement may not be amended or modified except by subsequent written agreement executed by both parties hereto.

     (e) Multiple Counterparts. This Agreement may be executed in multiple counterparts, each of which shall constitute an original, but all of which together shall constitute one Agreement.

     (f) Notices. Any notice provided for in this Agreement shall be deemed delivered upon deposit in the United States mails, registered or certified mail, addressed to the party to whom directed at the addresses set forth below or at such other addresses as may be substituted therefore by notice given hereunder. Notice given by any other means must be in writing and shall be deemed delivered only upon actual receipt.

If to the Company:

Metrocorp, Inc.

1523 8^th Street

East Moline, Illinois 61244

Attention: General Counsel

If to Employee:

To the last address reflected on the records of the Company, unless

otherwise provided in writing to the Company pursuant to this Section.

     (g) Waiver. The waiver of any breach of any term or condition of this Agreement shall not be deemed to constitute the waiver of any breach of the same or any other term or condition of this Agreement.

     (h) Severability. In the event any provision of this Agreement is found to be unenforceable or invalid, such provision shall be severable from this Agreement and shall not affect the enforceability or validity of any other provision of this Agreement. If any provision of this Agreement is capable to two constructions, one of which would render the provision void and the other that would render the provision valid, then the provision shall have the construction that renders it valid.

     (i) Arbitration of Disputes. Except for disputes and controversies involving equitable or injunctive relief, any dispute or controversy arising under or in connection

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with this Agreement shall be conducted in accordance with the rules set forth by the American Arbitration Association. The decision of the arbitrator shall be binding on Employee and the Company. Judgment may be entered on the arbitrator’s award in any court having jurisdiction.

     (j) Legal Fees and Expenses. If Employee shall prevail in any contest by the Company or others contesting the validity or enforcement of, or liability under, any term or provision of this Agreement, the Company shall pay any and all reasonable attorney, accounts’ and experts’ fees and expenses and court costs, incurred by Employee as a result of any such contest. Otherwise, each party shall bear his, her or its own expenses in connection with any such contest.

[Signature page follows]

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     IN WITNESS WHEREOF, the parties have executed this Agreement as of the Effective Date.

COMPANY:

Metrocorp, Inc.

By: 

Name:

Title:

EMPLOYEE:

Name:

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EX-10.3

EXHIBIT 10.3

METROCORP, INC.

Change of Control Severance Plan

     This Change of Control Severance Plan (the “Plan”) is adopted as of September 22, 2005 by Metrocorp, Inc., an Illinois corporation (the “Company”), for the benefit of the employees of the Company and its subsidiaries.

     WHEREAS, as part of its evaluation of all of its strategic alternatives, the Company has undertaken a process that might lead to a sale or other change of control of the Company and its subsidiaries;

     WHEREAS, in order to preserve stockholder value in the Company, the Board of Directors of the Company (the “Board”) has determined that it is in the best interests of the Company and its stockholders to assure that the employees of the Company and its subsidiaries will remain employed and that the Company and its subsidiaries will have the continued dedication of their employees, notwithstanding the possibility or occurrence of a sale of the Company and its subsidiaries.

     WHEREAS, the Board believes it is imperative (i) to diminish the inevitable and significant distractions of its employees and dilution of the time of its employees, by virtue of the personal uncertainties and risks created by a potential sale of the Company and its subsidiaries; and (ii) to encourage its employees’ full attention and dedication to the Company and its subsidiaries currently and in the event of any planned or pending sale; and

     WHEREAS, in order to accomplish the objectives described in the preceding recitals, the Board desires to cause the Company to adopt this Plan as set forth herein.

     NOW, THEREFORE, Board hereby adopts this Plan on behalf of the Company and its subsidiaries:

     1. Definitions. As used herein:

          (a) “Cause” means (i) any act of dishonesty taken by an Employee in connection with his responsibilities as an employee of the Company and its Subsidiaries which is intended to result in personal enrichment; (ii) an Employee’s conviction of a felony; (iii) willful misconduct by an Employee which is injurious to the Company and its Subsidiaries, or (iv) the continued failure of an Employee, who is employed in the same or similar employment position as he was employed on the date immediately preceding the Effective Date to substantially perform his obligations to the Company and its Subsidiaries considering the scope and importance of the Employee’s position after there has been delivered to the Employee a written demand for performance from the Company that describes the basis for the Company’s belief that the Employee has not substantially performed his duties and which includes a cure period of at least 30 days.

          (b) “Change of Control” means (i) the acquisition by any person or entity, or any group of persons or entities acting in concert (a “Person”) of direct or indirect beneficial ownership of 50% or more of the voting power or voting securities of the Company, not held by such Person as of the date of adoption of this Plan, (ii) the acquisition by any Person of direct or indirect beneficial ownership of 25% or more of the voting power or voting securities of the Company not held by such Person as of the date of adoption of this Plan and the subsequent election of a majority of the members of the Company’s Board of Directors who were not members of the Board for the 2-year period immediately preceding their election, (iii) a transfer of all or substantially all of the Company’s assets to another Person who is not a

wholly-owned subsidiary of the Company, or (iv) merger or consolidation of the Company with another corporation where, as a result of such merger or consolidation, less than 75% of the outstanding voting securities of the surviving or resulting corporation will then be owned by the stockholders of the Company immediately prior to such merger or consolidation.

          (c) “Code” means the Internal Revenue Code of 1986, as amended.

          (d) “Effective Date” means the effective date of the first event to occur after the date of adoption of this Plan that constitutes a Change of Control.

          (e) “Employee” means any person employed by the Company and its Subsidiaries on the date immediately prior to the Effective Date. No person will be a participant in the Plan or eligible for a benefit under the Plan until and unless he is an Employee.

          (f) “Good Reason” means the occurrence of any of the following events: (i) a change in the location of the Employee’s place of employment to more than 55 miles from the Company’s current East Moline, Illinois headquarters without the Employee’s prior written consent; or (ii) a reduction of the Employee’s base pay or base salary by more than 10% on or after the Effective Date.

          (g) “Junior Officer” means an Employee who on the date immediately prior to the Effective Date is classified on the official organization chart of the Company or one of its Subsidiaries as an “officer” but at a level lower than Vice President.

          (h) “Medical Benefits” means coverage under a group health plan, as defined by Code Section 5000, that is maintained by the Company and its Subsidiaries on the date immediately preceding the date when an Employee terminates or resigns under the terms of this Plan.

          (i) “Non-Officer Employee” means an Employee who on the date immediately prior to the Effective Date is not a Junior Officer, Vice President or Senior Executive.

          (j) “Senior Executive” means an Employee who on the date immediately prior to the Effective Date is classified on the official organization chart of the Company or one of its Subsidiaries as a “Senior Vice President,” “General Counsel” or “President.”

          (k) “Subsidiaries” means Metrobank, N.A. and any other entity in which the Company owns greater than a majority of the outstanding voting securities.

          (l) “Vice President” means an Employee who on the date immediately prior to the Effective Date is classified on the official organization chart of the Company or one of its Subsidiaries as a “Vice President” but at a level lower than “Senior Vice President.”

     2. Non-Officer Employee Severance Rights. If a Non-Officer Employee is terminated without Cause or resigns for Good Reason during the 90 days immediately following the Effective Date, such Non-Officer Employee will be entitled to a payment calculated as follows:

          (a) such Non-Officer Employee’s then current daily base salary or base rate of pay, as applicable, at the time of his termination of or resignation from employment but without any reduction described in Section 1(f)(ii) of this Plan; times

          (b) the greater of (i) number of days remaining between the Non-Officer Employee’s termination of or resignation from employment and the 90-day anniversary of the Effective Date or (ii) 30

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days (such period in (i) or (ii), as the case may be, referred to as the “Non-Officer Employee Severance Period”). The daily base rate of pay of an Employee who is classified by the Company as “part-time” on the date immediately preceding Effective Date will be determined for purposes of this Section 2 based upon the average daily hours worked by such Employee over the consecutive 12-month period ending on the day before his termination or resignation.

The Company will make this payment in a single lump sum to the Non-Officer Employee within 5 days of his last day of employment with the Company and any of its Subsidiaries.

     In addition, if COBRA coverage is timely elected for any Medical Benefits for the Non-Officer Employee, his spouse or any dependent for the Non-Officer Employee Severance Period, the Company will reimburse the Non-Officer Employee for the COBRA coverage premium timely paid for that period; provided, that the Non-Officer Employee provides the Company with reasonable documentation of any such premium payment within 2 months of its payment. In the event that the amount of any such reimbursed premium is includable in the Non-Officer Employee’s gross income for federal, state, or local income taxes or in his wages for employment tax purposes, the Company will pay to the Non-Officer Employee an additional amount such that the net amount retained by him (after deduction of these federal, state and local income and employment taxes and any related penalty and interest assessed for delinquent payment of these taxes) will be equal to the total premium payment reimbursed by the Company; provided, that the Non-Officer Employee provides the Company with reasonable documentation of the payment of such taxes, penalty and interest within 2 months of their payment. On the first payroll date in each calendar month, the Company will pay in a single sum all reimbursements or additional amounts provided under this paragraph for which the Non-Officer Employee has timely provided reasonable documentation to the Company since the first payroll date in the immediately preceding calendar month.

     3. Junior Officer Severance Rights. If a Junior Officer is terminated without Cause or resigns for Good Reason during the 6 consecutive months immediately following the Effective Date, such Junior Officer will be entitled to a payment calculated as follows:

          (a) such Junior Officer’s then current monthly base salary at the time of his termination of or resignation from employment but without any reduction described in Section 1(f)(ii) of this Plan; times

          (b) the number of full or partial months remaining between the Junior Officer’s termination of or resignation from employment and the 6-month anniversary of the Effective Date (“Junior Officer Severance Period”).

The Company will make this payment in a single lump sum to the Junior Officer within 5 days of his last day of employment with the Company and any of its Subsidiaries.

     In addition, if COBRA coverage is timely elected for any Medical Benefits for the Junior Officer, his spouse or any dependent for the Junior Officer Severance Period, the Company will reimburse the Junior Officer for any COBRA coverage premium timely paid for that period; provided, that the Junior Officer provides the Company with reasonable documentation of any such premium payment within 2 months of its payment. In the event that the amount of any such reimbursed premium is includable in the Junior Officer’s gross income for federal, state, or local income taxes or in his wages for employment tax purposes, the Company will pay to the Junior Officer an additional amount such that the net amount retained by him (after deduction of these federal, state and local income and employment taxes and any related penalty and interest assessed for delinquent payment of these taxes) will be equal to the total premium payment reimbursed by the Company; provided, that the Junior Officer provides the Company with reasonable documentation of the payment of such taxes, penalty and interest within 2 months of their

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payment. On the first payroll date in each calendar month, the Company will pay in a single sum all reimbursements or additional amounts provided under this paragraph for which the Junior Officer has timely provided reasonable documentation to the Company since the first payroll date in the immediately preceding calendar month.

     4. Vice President Severance Rights. If a Vice President is terminated without Cause or resigns for Good Reason during the 12 consecutive months immediately following the Effective Date, such Vice President will be entitled to a payment calculated as follows:

          (a) such Vice President’s then current monthly base salary at the time of his termination of or resignation from employment but without any reduction described in Section 1(f)(ii) of this Plan; times

          (b) the number of full or partial months remaining between the Vice President’s termination of or resignation from employment and the 12-month anniversary of the Effective Date (“Vice President Severance Period”).

The Company will make this payment in a single lump sum to the Vice President within 5 days of his last day of employment with the Company and any of its Subsidiaries.

     In addition, if COBRA coverage is timely elected for any Medical Benefits for the Vice President, his spouse or any dependent for the Vice President Severance Period, the Company will reimburse the Vice President for any COBRA coverage premium timely paid for that period; provided, that the Vice President provides the Company with reasonable documentation of any such premium payment within 2 months of its payment. In the event that the amount of any such reimbursed premium is includable in the Vice President’s gross income for federal, state, or local income taxes or in his wages for employment tax purposes, the Company will pay to the Vice President an additional amount such that the net amount retained by him (after deduction of these federal, state and local income and employment taxes and any related penalty and interest assessed for delinquent payment of these taxes) will be equal to the total premium payment reimbursed by the Company; provided, that the Vice President provides the Company with reasonable documentation of the payment of such taxes, penalty and interest within 2 months of their payment. On the first payroll date in each calendar month, the Company will pay in a single sum all reimbursements or additional amounts provided under this paragraph for which the Vice President has timely provided reasonable documentation to the Company since the first payroll date in the immediately preceding calendar month.

     5. Senior Executive Severance Rights. If a Senior Executive is terminated without Cause or resigns for Good Reason during the 24 consecutive months immediately following the Effective Date, such Senior Executive will be entitled to a payment calculated as follows:

          (a) such Senior Executive’s then current monthly base salary at the time of his termination of or resignation from employment but without any reduction described in Section 1(f)(ii) of this Plan; times

          (b) the number of full or partial months remaining between the Senior Executive’s termination of or resignation from employment and the 24-month anniversary of the Effective Date (“Senior Executive Severance Period”).

The Company will make this payment in a single lump sum to the Senior Executive within 5 days of his last day of employment with the Company and any of its Subsidiaries.

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     In addition, if COBRA coverage is timely elected for any Medical Benefits for the Senior Executive, his spouse or any dependent for the Senior Executive Severance Period, the Company will reimburse the Senior Executive for any COBRA coverage premium timely paid for that period; provided, that the Senior Executive provides the Company with reasonable documentation of any such premium payment within 2 months of its payment. In the event that the amount of any such reimbursed premium is includable in the Senior Executive’s gross income for federal, state, or local income taxes or in his wages for employment tax purposes, the Company will pay to the Senior Executive an additional amount such that the net amount retained by him (after deduction of these federal, state and local income and employment taxes and any related penalty and interest assessed for delinquent payment of these taxes) will be equal to the total premium payment reimbursed by the Company; provided, that the Senior Executive provides the Company with reasonable documentation of the payment of such taxes, penalty and interest within 2 months of their payment. On the first payroll date in each calendar month, the Company will pay in a single sum all reimbursements or additional amounts provided under this paragraph for which the Senior Executive has timely provided reasonable documentation to the Company since the first payroll date in the immediately preceding calendar month.

     6. Excise Tax Issues. Notwithstanding anything in this Plan to the contrary, in the event it will be determined in good faith by the Company’s independent accountants prior to the Effective Date that any payment, award, benefit or distribution (or any acceleration of any payment, award, benefit or distribution) by the Company (or any of its affiliated entities) or any entity which effectuates a Change in Control (or any of its affiliated entities) to or for the benefit of any Employee is subject to the excise tax under Code Section 4999, then the amounts payable to such Employee under this Plan will be reduced to the maximum amount as will result in no portion of the Payments being subject to such excise tax (the “Safe Harbor Cap”). For purposes of reducing the Payments to the Safe Harbor Cap, only amounts payable to an Employee under this Plan (and no other payments) will be reduced, unless otherwise consented to by such Employee.

     7. Termination. If no Change of Control has occurred within 12 months after the date of adoption of this Plan, unless this Plan has been further extended by the Board, this Plan and all obligations of the Company hereunder will terminate and become void.

     8. Withholding. The Company will withhold from any benefit payment under this Plan all federal, state, and local taxes or other amounts as required pursuant to any law, governmental regulation or ruling. If any such taxes or other amounts are due with respect to any benefit earned by an Employee prior to the time of the benefit payment under this Plan, the Company will withhold from any other compensation or payment due to the Employee all federal, state, and local taxes or other amounts required to be withheld from that payment.

     9. Successors and Assigns. The obligations of the Company hereunder will be binding upon the Company and its successors and assigns, including but not limited to any successor of the Company upon a Change of Control.

     10. Amendment. After a Change of Control, no amendments, modifications additions, or deletions to this Plan will be effective unless made in writing and signed by any Employee affected by such change. Prior to a Change of Control, this Plan may be amended upon resolution of the Board; provided, however, that no such amendment will materially reduce the benefits provided hereunder.

     11. Administration. The Company will operate and administer the Plan. In its sole discretion, the Company will construe and interpret the Plan, including disputed and doubtful terms and provisions and, in its sole discretion, decide all questions of eligibility for benefits payments and determine the amount, manner and time of benefits under the Plan terms. All determinations and interpretations of the Company will be consistently and uniformly applied to all employees and will be

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conclusive and binding on all parties. If any employee of the Company, or his representative, disagrees with any such construction, interpretation or determination by the Company, the employee or his representative, can make a claim for benefits under the separate claims procedures for this Plan, a copy of which can be obtained from the Chairman of the Board free of charge. By this reference, the separate claims procedures are incorporated into and made a part of this Plan.

     12. Governing Law. This Plan is a welfare benefit plan subject to the Employee Retirement Income Security Act of 1974, as amended, and it will be interpreted, administered, and enforced in accordance with that law. To the extent that state law is applicable, the statutes and common law of the State of Illinois will apply, without regard to the conflict of laws principles.

     13. American Jobs Creation Act of 2004. Code Section 409A applies to benefits provided under this Plan. The provisions of this Plan are intended to comply with Section 409A and the guidance issued by the Internal Revenue Service and proposed and final regulations issued by the Treasury Department. These provisions will be consistently interpreted and applied by the Board so that benefits under this Plan will not be subject to taxation under Code Section 409A.

     14. Delayed Payment Date. Notwithstanding any provision to the contrary, any payment or reimbursement (or related additional amount) due under this Plan to a “specified employee” as defined by Code Section 409A(a)(2)(B)(i) (pertaining to payments to a key employee of a corporation whose stock is publicly traded on an established securities market or otherwise) will be made on the later of the date that it is to be paid under this Plan without regard to this Section 14 or on the Company’s first payroll date after the 6-month anniversary of the Employee’s last day of work with the Company and its Subsidiaries due to his termination of or resignation from employment under the terms of this Plan. Any payment delayed by the provisions of this Section 14 will be paid without interest.

     15. Miscellaneous.

          (a) The Plan is intended to be and at all times will be interpreted and administered as an unfunded, employee welfare benefit Plan under Section 3(1) of the Employee Retirement Income Security Act of 1974, as amended. All Plan benefits will be paid from the Company’s general assets. The right of an Employee to receive any payment under the Plan will be an unsecured claim against the general assets of the Company. An Employee will have no right against any specific assets of the Company.

          (b) The Plan Year is the consecutive 12-month period beginning each November 1 and ending the following October 31; provided, that the first Plan Year will begin on September 22, 2005 and end the following October 31.

          (c) The Company is the Plan Administrator.

          (d) No Employee may anticipate, assign, or alienate (either at law or in equity) any benefit or right provided under the Plan. Any such anticipation, assignment or alienation will be null and void.

          (e) Nothing in this Plan will be construed to limit in any way the right of Company or any of its Subsidiaries to terminate the employment of an Employee at any time for any reason; or evidence any agreement or understanding, express or implied, that the Company or any of its subsidiaries will employ an Employee in any position or at any rate of remuneration or for any period of time.

          (f) The benefits provided under this Plan to an Employee are in addition to any benefit provided under the terms of any other plan maintained by the Company or any of its Subsidiaries.

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          (g) As used in this Plan the term “and” means “and/or”, the singular includes the plural, and the masculine includes the feminine and neuter. Headings of sections are not to be considered in the construction and interpretation of the Plan.

METROCORP, INC.
By:	/s/ Gary D. Andersen
Title: President
Date: September 22, 2005

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METROCORP, INC.
CHANGE OF CONTROL SEVERANCE PLAN
CLAIMS PROCEDURES

     These are the claims procedures for the Metrocorp, Inc. Change of Control Severance Plan or “Plan”. Unless otherwise provided, a capitalized term in these procedures has the same meaning as the meaning that is given to it in the Plan.

     The Company has the sole discretion to construe and interpret the Plan, including disputed and doubtful terms and provisions and, in its sole discretion, to determine the benefit of any employee under the Plan terms — a “Claimant”. If a Claimant (or his representative) disagrees with any such construction, interpretation or determination by the Company, the Claimant can make a claim for benefits under these claims procedures.

Filing A Claim For Benefits

     A Claimant may submit to the Company a written claim for benefits under the Plan. The Company will evaluate the claim to determine if the Claimant is entitled to any benefit under the Plan terms. To make this determination, the Company may request that the Claimant provide it with additional information. If the Company determines that the Claimant is entitled to a benefit under the Plan, the Claimant will receive a statement describing this benefit, the method or methods of payment, the timing for his benefit payment and other relevant information. The Company has the sole discretion to interpret and apply the Plan terms, to decide all questions of eligibility, and determine the time and manner of benefit payments under the Plan terms.

Designation Of An Authorized Representative

     If a Claimant wishes to designate a representative to make a claim for benefits under the Plan or to appeal an adverse determination of a benefits claim on behalf of a Claimant, the Company will provide the Claimant with the appropriate forms for this designation. The Claimant must complete and return these forms to the Company before the Claimant’s representative can receive any information from the Company or any other fiduciary or representative about the Claimant’s claim for benefits under the Plan. All communications by the Company or any other fiduciary or representative about the Claimant’s claim will then be made with his or her authorized representative.

Claims Procedure

     If a claim for benefits is wholly or partially denied by the Company, the Board will provide the Claimant with a written notice of the Company’s denial within a reasonable period of time after the Board received the claim. The written notice must contain the following information:

(a)	The specific reason or reasons for the denial;
(b)	Specific reference to the Agreement provisions on which the denial is based;
(c)	A description of any additional material or information necessary to complete the claim for benefits and an explanation of why this material or information is necessary; and

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(d) An explanation of the steps to be taken if the Claimant wishes to submit the claim for review and the time limits that apply to the review procedures including a statement of his or her right to bring a civil action under ERISA in the event of a denial on review.

     The Company’s written notice of denial must be provided within 90 days of the date when the Claimant’s written claim was received by the Company, unless special circumstances require an extension of the period for processing the claim. If such an extension is required, the Company will provide a written notice of this extension to the Claimant prior to the expiration of the regular 90-day period specifying the circumstances that require the extension and the date upon which a final decision can be expected. In no event will the extension exceed 90 days from the end of the regular 90-day period.

     If notice of the denial of the Claimant’s claim is not provided by the Company within a reasonable time, as described above, his or her claim for benefits under the Agreement is deemed denied and the Claimant can then proceed to the review of his claim.

Review Procedure

     If a Claimant disagrees with the Company’s determination of his or her benefit or with any other decision that the Company makes regarding his benefits under the Plan, the Claimant must follow this appeal procedure. If a Claimant disagrees with the Company’s denial of his benefit claim, the Claimant must appeal the adverse determination in writing to the Company within 60 days after the receipt of the notice of denial (or, if applicable, within 60 days after the date on which the denial is considered to have occurred).

     If a Claimant appeals an adverse determination of his or her claim for benefits under the Plan, he must submit in writing the pertinent issues and comments regarding the denial to permit the examination of all facts and a final determination with respect to the Claimant’s claim for benefits. The Company will provide to the Claimant, upon written request and free of charge, copies of all documents, records and other information relevant to his claim.

     A Claimant’s appealed claim must receive a full and fair review that takes into account all comments, documents, records and other information that he or she submits relating to his or her claim, regardless of whether such information was submitted or considered in the initial benefit determination.

     In the case of an adverse determination, the Company will make a decision generally within 60 days of a request on appeal unless special circumstances make the rendering of a decision within the 60-day period not feasible. In any event, the Company must render a decision within 120 days after its receipt of a request for review. If an extension is required, the Company will provide a written notice of this extension to the Claimant prior to the expiration of the regular 60-day period specifying the circumstances that require the extension and the date upon which a final decision can be expected.

     If on review, the Company determines that a Claimant is entitled to a benefit, he will receive a statement describing this benefit, the method or methods of payment, the timing for his or her benefit payment and other relevant information.

     If on review, a Claimant’s claim for benefits is denied, the Company will provide the Claimant with adequate notice in writing setting forth the specific reasons for the denial and referring him or her to the pertinent provisions of the Plan supporting the denial. This notice will contain a statement that

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the Claimant will be provided, upon written request and free of charge, reasonable access to, and copies of all documents, records and other information relevant to his or her claim, and a statement regarding the Claimant’s right to bring an action under ERISA.

     If notice of the denial of a Claimant’s claim is not provided by the Company within a reasonable time, as described above, his or her claim for benefits under the Plan is deemed denied and the Claimant can then proceed to bring an ERISA civil action in state or federal court.

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EX-10.4

EXHIBIT 10.4

METROCORP, INC.

Stay Bonus Plan

     This Stay Bonus Plan (the “Plan”) is adopted as of November 11, 2005 by Metrocorp, Inc., an Illinois corporation (the “Company”), for the benefit of its employees and those of its subsidiaries.

     WHEREAS, the Company has undertaken a process that might lead to a sale or other change of control of the Company and its subsidiaries; and

     WHEREAS, the Company wishes to maintain the continued dedication of its employees and those of its subsidiaries throughout this process until such a sale or other change of control occurs.

     NOW THEREFORE, the Board of Directors of the Company (the “Board”) has approved and the Company adopts this Plan to provide as follows:

     1. Definitions. As used herein:

          (a) “Change of Control” means (i) the acquisition by any person or entity, or any group of persons or entities acting in concert (a “Person”) of direct or indirect beneficial ownership of 50% or more of the voting power or voting securities of the Company, not held by such Person as of the date of adoption of this Plan, (ii) the acquisition by any Person of direct or indirect beneficial ownership of 25% or more of the voting power or voting securities of the Company not held by such Person as of the date of adoption of this Plan and the subsequent election of a majority of the members of the Company’s Board of Directors who were not members of the Board for the 2-year period immediately preceding their election, (iii) a transfer of all or substantially all of the Company’s assets to another Person who is not a wholly-owned subsidiary of the Company, or (iv) merger or consolidation of the Company with another corporation where, as a result of such merger or consolidation, less than 75% of the outstanding voting securities of the surviving or resulting corporation will then be owned by the stockholders of the Company immediately prior to such merger or consolidation.

          (a) “Code” means the Internal Revenue Code of 1986, as amended.

          (b) “Compensation” means the greater of the Employee’s annual base pay at the rate in effect on November 11, 2005 or at the rate in effect on the Effective Date.

          (c) “Effective Date” means the effective date of the first event to occur after the date of adoption of this Plan that constitutes a Change of Control.

          (d) “Employee” means any person other than Gary D. Andersen, Nancy R. Hamilton, or Julius J. Van Paemel Bart Ottens, Branden Alexander, Doug Vanderlaan, Mark Milder, Rich Skrivseth or Lori Welsh who is continually employed by the Company or one of its Subsidiaries for the period beginning on November 11, 2005 and ending on the Effective Date.

No person will be a participant in the Plan or eligible for a benefit under the Plan until and unless he is an Employee.

          (e) “Subsidiaries” means Metrobank, N.A. and any other entity in which the Company owns greater than a majority of the outstanding voting securities.

     2. Stay Bonus. Each Employee will be entitled to a payment in the amount equal to 12% of his Compensation. The Company will make this payment on the earlier of its first regular payroll date following the Effective Date or the 10^th day following the Effective Date.

     3. Termination. If no Change of Control has occurred within 12 months after the date of adoption of this Plan, unless this Plan has been further extended by the Board, this Plan and all obligations of the Company hereunder will terminate and become void.

     4. Withholding. The Company will withhold from any benefit payment under this Plan all federal, state, and local taxes or other amounts as required pursuant to any law, governmental regulation or ruling. If any such taxes or other amounts are due with respect to any benefit earned by an Employee prior to the time of the benefit payment under this Plan, the Company will withhold from any other compensation or payment due to the Employee all federal, state, and local taxes or other amounts required to be withheld from that payment.

     5. Successors and Assigns. The obligations of the Company hereunder will be binding upon the Company and its successors and assigns, including but not limited to any successor of the Company upon a Change of Control.

     6. Amendment. After a Change of Control, no amendments, modifications additions, or deletions to this Plan will be effective unless made in writing and signed by any Employee affected by such change. Prior to a Change of Control, this Plan may be amended upon resolution of the Board; provided, however, that no such amendment will materially reduce the benefits provided hereunder.

     7. Administration. The Company will operate and administer the Plan. In its sole discretion, the Company will construe and interpret the Plan, including disputed and doubtful terms and provisions and, in its sole discretion, decide all questions of eligibility for benefits payments and determine the amount, manner and time of benefits under the Plan terms. All determinations and interpretations of the Company will be consistently and uniformly applied to all employees and will be conclusive and binding on all parties.

     8. Governing Law. Illinois state law will govern this Plan, without reference to the conflict of laws principles.

     9. American Jobs Creation Act of 2004. Code Section 409A applies to benefits provided under this Plan. The provisions of this Plan are intended to comply with Section 409A and the guidance issued by the Internal Revenue Service and proposed and final regulations issued by the Treasury Department. These provisions will be consistently interpreted and applied by the Board so that benefits under this Plan will not be subject to taxation under Code Section 409A.

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     10. Miscellaneous.

          (a) The Plan is intended to be and at all times will be interpreted and administered as an unfunded plan that is not subject to the provisions of the Employee Retirement Income Security Act of 1974, as amended. All Plan benefits will be paid from the Company’s general assets. The right of an Employee to receive any payment under the Plan will be an unsecured claim against the general assets of the Company. An Employee will have no right against any specific assets of the Company.

          (b) No Employee may anticipate, assign, or alienate (either at law or in equity) any benefit or right provided under the Plan. Any such anticipation, assignment or alienation will be null and void.

          (c) Nothing in this Plan will be construed to limit in any way the right of Company or any of its Subsidiaries to terminate the employment of an Employee at any time for any reason; or evidence any agreement or understanding, express or implied, that the Company or any of its subsidiaries will employ an Employee in any position or at any rate of remuneration or for any period of time.

          (d) The benefits provided under this Plan to an Employee are in addition to any benefit provided under the terms of any other plan maintained by the Company or any of its Subsidiaries.

          (e) As used in this Plan the term “and” means “and/or”, the singular includes the plural, and the masculine includes the feminine and neuter. Headings of sections are not to be considered in the construction and interpretation of the Plan.

METROCORP, INC.
By:	/s/ Gary D. Andersen
Title: President
Date: November 11, 2005

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EX-10.5

EXHIBIT 10.5

RENEWAL OF LEASE AGREEMENT

     THIS AGREEMENT is made this 11th day of July, 2000, between Metro Bank, hereinafter called “Lessee”, and WAL-MART STORES, INC., a Delaware corporation, with offices at 702 S.W. Eighth Street, Bentonville, Arkansas 72716 and a mailing address of 2001 S.E. Tenth Street, Bentonville, Arkansas 72712, hereinafter called “Lessor”.

WITNESSETH:

     WHEREAS, the Lessor and Lessee have entered into a Lease agreement dated January 16, 1996, (the “Lease”), affecting certain premises in the City of Moline, Illinois, Store # 2231;

     WHEREAS, Lessor and Lessee desire to renew the terms of the Lease; and

     WHEREAS, the parties are now desirous of exercising certain rights under Lease to reflect accurately their intents and wishes.

     NOW, THEREFORE, that for One Dollar ($1.00) and other good and valuable considerations, the receipt and sufficiency of which is hereby acknowledged, Lessor and Lessee hereby agree as follows:

1.	Lessee hereby exercises the option to extend the Lease as set forth in Section 1.1(j) of the Lease for a period of five (5) years as allowed in the Lease.
2.	TERM. The option period will begin on May 1, 2001 and will expire on April 30, 2006
3.	RENTAL. The Rent for the option period will be $2,265.00 per month.

     IN WITNESS WHEREOF, the parties have executed this Agreement the day and year first hereinabove written.

WITNESS OR ATTEST:	LESSEE:
	Metro Bank
/s/ Carolyn Lamb	/s/ Gary D. Anderson
	Its President
ATTEST:	LESSOR:
	Wal-mart Stores, Inc.
/s/ John Y. Thomas, Assistant Secretary	/s/ Kimberly K. Saylors, Director
	Wal-Mart Realty Company

EX-10.6

EXHIBIT 10.6

REPLACEMENT REVOLVING NOTE

$8,000,000.00
Chicago, Illinois Date: as of August 5, 2002
Due Date: July 24, 2008

     FOR VALUE RECEIVED, METROCORP, INC., a Delaware corporation (the “Borrower”), whose address is 1523 8th Street, East Moline, Illinois 61244, promises to pay to the order of LASALLE BANK NATIONAL ASSOCIATION, a national banking association (hereinafter, together with any holder hereof, called the “Bank”), whose address is 135 South LaSalle Street, Chicago, Illinois 60603, on or before July 24, 2008 (the “Maturity Date”), the lesser of (i) the principal sum of EIGHT MILLION and 00/100 DOLLARS ($8,000,000.00), or (ii) the aggregate principal amount of all Loans outstanding under and pursuant to that certain Loan Agreement dated as of November 1, 2001 between the Borrower and the Bank, as amended by that certain Second Amendment to Loan Agreement dated as of November 30, 2001 and from time to time (as amended, supplemented or modified from time to time, the “Loan Agreement”), and made available by the Bank to the Borrower at the maturity or maturities and in the amount or amounts stated on the records of the Bank, together with interest (computed on the actual number of days elapsed on the basis of a 360 day year) on the aggregate principal amount of all Loans outstanding from time to time as provided in the Loan Agreement. Capitalized words and phrases not otherwise defined herein shall have the meanings assigned thereto in the Loan Agreement.

     This Replacement Revolving Note evidences the Loans and other indebtedness incurred by the Borrower under and pursuant to the Loan Agreement, to which reference is hereby made for a statement of the terms and conditions under which the Maturity Date or any payment hereon may be accelerated. The holder of this Replacement Revolving Note is entitled to all of the benefits and security provided for in the Loan Agreement. All Loans shall be repaid by the Borrower on the Maturity Date, unless payable sooner pursuant to the provisions of the Loan Agreement.

     Principal and interest shall be paid to the Bank at its address set forth above, or at such other place as the holder of this Replacement Revolving Note shall designate in writing to the Borrower. Each Loan made by the Bank, and all payments on account of the principal and interest thereof shall be recorded on the books and records of the Bank and the principal balance as shown on such books and records, or any copy thereof certified by an officer of the Bank, shall be rebuttably presumptive evidence of the principal amount owing hereunder.

     Except for such notices as may be required under the terms of the Loan Agreement, the Borrower waives presentment, demand, notice, protest, and all other demands, or notices, in connection with the delivery, acceptance, performance, default, or enforcement of this Replacement Revolving Note, and assents to any extension or postponement of the time of payment or any other indulgence.

     The Loans evidenced hereby have been made and/or issued and this Replacement Revolving Note has been delivered at the Bank’s main office set forth above. This Replacement Revolving Note shall be governed and construed in accordance with the laws of the State of Illinois, in which state it shall be performed, and shall be binding upon the Borrower, and its legal representatives, successors, and assigns. Wherever possible, each provision of the Loan Agreement and this Replacement Revolving Note shall be interpreted in such manner as to be

effective and valid under applicable law, but if any provision of the Loan Agreement or this Replacement Revolving Note shall be prohibited by or be invalid under such law, such provision shall be severable, and be ineffective to the extent of such prohibition or invalidity, without invalidating the remaining provisions of the Loan Agreement or this Replacement Revolving Note.

     This Replacement Revolving Note is in substitution for and replacement of, but not in repayment of, that certain Replacement Revolving Note dated as of November 30, 2001 in the maximum principal amount of $10,000,000 made by the Borrower payable to the order of the Bank, and shall not be deemed to constitute a novation therefor.

     IN WITNESS WHEREOF, the Borrower has executed this Replacement Revolving Note as of the date set forth above.

ATTEST:	METROCORP, INC., a Delaware corporation
/s/ John R. McEvoy	/s/ Gary D. Andersen
Senior Vice President 1/4/03	President

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EX-10.7

EXHIBIT 10.7

LOAN AGREEMENT

     This LOAN AGREEMENT dated as of November 1, 2001 (the “Agreement”), is executed by and between METROCORP, INC., a Delaware corporation (the “Borrower”), whose address is 1523 8th Street, East Moline, Illinois 61244, and LASALLE BANK NATIONAL ASSOCIATION, a national banking association (the “Bank”), whose address is 135 South LaSalle Street, Chicago, Illinois 60603.

     In consideration of the mutual agreements hereinafter set forth, the Borrower and the Bank hereby agree as follows:

1. DEFINITIONS.

     1.1 Defined Terms. For the purposes of this Agreement, the following capitalized words and phrases shall have the meanings set forth below.

          “Bankruptcy Code” shall mean the United States Bankruptcy Code, as now existing or hereafter amended.

          “Business Day” shall mean any day other than a Saturday, Sunday or a legal holiday on which banks are authorized or required to be closed for the conduct of commercial banking business in Chicago, Illinois.

          “Collateral” shall have the meaning set forth in Section 9.10. “Communication” shall have the meaning set forth in Section 11.16.

          “Default Rate” shall mean a per annum rate of interest equal to the Prime Rate plus 2% per annum.

          “Event of Default” shall mean any of the events or conditions set forth in Section 9 hereof.

          “GAAP” shall mean generally accepted accounting principles, using the accrual basis of accounting and consistently applied with prior periods, provided, however, that GAAP with respect to any interim financial statements or reports shall be deemed subject to fiscal year-end adjustments and footnotes made in accordance with GAAP.

          “Indemnified Party” and “Indemnified Parties” shall mean, respectively, each of the Bank and any parent corporations, affiliated corporations or subsidiaries of the Bank, and each of their respective officers, directors, employees, attorneys and agents, and all of such parties and entities.

          “Interest Period” shall mean, with regard to any LIBOR Loan, successive one, two, three or six month periods as selected from time to time by the Borrower by notice given to the Bank not less than three Business Days prior to the first day of each respective Interest Period; provided, however, that: (i) each such Interest Period occurring after the initial Interest Period of any LIBOR Loan shall commence on the day on which the preceding Interest Period for such LIBOR Loan expires, (ii) whenever the last day of any Interest Period would otherwise occur on a day other than a Business Day, the last day of such Interest Period shall be extended to occur on the next succeeding Business Day, provided, however, that if such extension would cause the last day of such Interest Period to occur in the next following calendar month, then the last day of such Interest Period shall occur on the immediately preceding Business Day; (iii) whenever the first day of any Interest Period occurs on a day of a month for which there is no numerically corresponding day in the calendar month in which such Interest Period terminates, such Interest Period shall end on the last Business Day of such calendar month; (iv) if the

Loans are subject to a Mandatory Prepayment, the last Business Day of the then current Interest Period for all Loans which are LIBOR Loans must coincide with the date of the Mandatory Prepayment, and (v) the final Interest Period must be such that its expiration occurs on or before the Maturity Date.

          “Interest Rate” shall mean the Borrower’s from time to time option of (i) the Prime Rate, (ii) the LIBOR Rate.

          “Issuer” collectively, the “Issuers” shall mean Metrobank, N.A.; Farmers State Bank and Community Bank and their respective successors and assigns.

          “LIBOR” shall mean a rate of interest equal to the per annum rate of interest at which United States dollar deposits in an amount comparable to the amount of the relevant LIBOR Loan and for a period equal to the relevant Interest Period are offered generally to the Bank (rounded upward if necessary, to the nearest 1/16 of 1.00%) in the London Interbank Eurodollar market at 11:00 a.m. (London time) two Business Days prior to the commencement of each Interest Period less the maximum reserve percentages for determining reserves to be maintained by member banks of the Federal Reserve System for Eurocurrency liabilities, or as LIBOR is otherwise determined by the Bank in its sole and absolute discretion, such rate to remain fixed for such Interest Period. The Bank’s determination of LIBOR shall be conclusive, absent manifest error.

          “LIBOR Rate” shall mean a per annum rate of interest equal to LIBOR for the relevant Interest Period (rounded upward if necessary, to the nearest 1/16 of 1.00%) plus 200 basis points (2.00%), which LIBOR Rate shall remain fixed during such Interest Period and shall be applicable to all LIBOR Loans made during such Interest Period.

          “LIBOR Loan” or “LIBOR Loans” shall mean that portion, and collectively those portions, of the aggregate outstanding principal balance of the Loans that will bear interest at the LIBOR Rate.

          “Loans” shall mean, collectively, all Loans (whether Prime Loans or LIBOR Loans) made by the Bank to the Borrower, under and pursuant to this Agreement.

          “Loan Commitment” shall mean Ten Million and 00/100 Dollars ($10,000,000.00). “Loan Documents” shall have the meaning set forth in Section 3.1. “Mandatory Prepayment” shall have the meaning set forth in Section 2.1(c).

          “Maturity Date” shall mean October 31, 2002, unless extended by the Bank pursuant to any modification, extension or renewal note executed by the Borrower and accepted by the Bank in its sole and absolute discretion in substitution for the Revolving Note

          “Note” shall mean the Revolving Note described in Section 4.

          “Obligations” shall mean the Loans, as evidenced by the Note, all interest accrued thereon, any fees due the Bank hereunder, any expenses incurred by the Bank hereunder and any and all other liabilities and obligations of the Borrower (and of any partnership in which the Borrower is or may be a partner) to the Bank, howsoever created, arising or evidenced, and howsoever owned, held or acquired, whether now or hereafter existing, whether now due or to become due, direct or indirect, absolute or contingent, and whether several, joint or joint and several, including, but not limited to, any interest rate agreements.

          “Obligor” shall mean the Borrower, any guarantor, accommodation endorser, third party pledgor, or any other party liable with respect to the Obligations.

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          “Person” shall mean any individual, partnership, limited liability company, corporation, trust, joint venture, joint stock company, association, unincorporated organization, government or agency or political subdivision thereof, or other entity.

          “Pledge Agreement” shall have the meaning set forth in Section 3.1(c).

          “Prime Loan” or “Prime Loans” shall mean that portion, and collectively, those portions of the aggregate outstanding principal balance of the Loans that will bear interest at the Prime Rate.

          “Prime Rate” shall mean the floating per annum rate of interest which at any time, and from time to time, shall be most recently announced by the Bank as its Prime Rate, which is not intended to be the Bank’s lowest or most favorable rate of interest at any one time. The effective date of any change in the Prime Rate shall for purposes hereof be the date the Prime Rate is changed by the Bank. The Bank shall not be obligated to give notice of any change in the Prime Rate.

          “Regulatory Change” shall mean the introduction of, or any change in any applicable law, treaty, rule, regulation or guideline or in the interpretation or administration thereof by any governmental authority or any central bank or other fiscal, monetary or other authority having jurisdiction over the Bank or its lending office.

          “UCC” shall mean the Uniform Commercial Code in effect in Illinois from time to time.

     1.2 Accounting Terms. Any accounting terms used in this Agreement which are not specifically defined herein shall have the meanings customarily given them in accordance with GAAP. Calculations and determinations of financial and accounting terms used and not otherwise specifically defined hereunder and the preparation of financial statements to be furnished to the Bank pursuant hereto shall be made and prepared, both as to classification of items and as to amount, in accordance with GAAP as used in the preparation of the financial statements of the Borrower on the date of this Agreement. If any changes in accounting principles or practices from those used in the preparation of the financial statements are hereafter occasioned by the promulgation of rules, regulations, pronouncements and opinions by or required by the Financial Accounting Standards Board or the American Institute of Certified Public Accountants (or any successor thereto or agencies with similar functions), which results in a material change in the method of accounting in the financial statements required to be furnished to the Bank hereunder or in the calculation of financial covenants, standards or terms contained in this Agreement, the parties hereto agree to enter into good faith negotiations to amend such provisions so as equitably to reflect such changes to the end that the criteria for evaluating the financial condition and performance of the Borrower will be the same after such changes as they were before such changes; and if the parties fail to agree on the amendment of such provisions, the Borrower will furnish financial statements in accordance with such changes but shall provide calculations for all financial covenants, perform all financial covenants and otherwise observe all financial standards and terms in accordance with applicable accounting principles and practices in effect immediately prior to such changes. Calculations with respect to financial covenants required to be stated in accordance with applicable accounting principles and practices in effect immediately prior to such changes shall be reviewed and certified by the Borrower’s accountants.

     1.3 Other Terms Defined in UCC. All other capitalized words and phrases used herein and not otherwise specifically defined shall have the respective meanings assigned to such terms in the UCC, as amended from time to time, to the extent the same are used or defined therein.

     1.4 Other Definitional Provisions; Construction. Whenever the context so requires, the neuter gender includes the masculine and feminine, the single number includes the plural, and vice versa, and in particular the word “Borrower” shall be so construed. The words “hereof”, “herein” and

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“hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and references to Article, Section, Subsection, Annex, Schedule, Exhibit and like references are references to this Agreement unless otherwise specified. An Event of Default shall “continue” or be “continuing” until such Event of Default has been waived in accordance with Section 11.3 hereof. References in this Agreement to any party shall include such party’s successors and permitted assigns. References to any “Section” shall be a reference to such Section of this Agreement unless otherwise stated. To the extent any of the provisions of the other Loan Documents are inconsistent with the terms of this Loan Agreement, the provisions of this Loan Agreement shall govern.

2. COMMITMENT OF THE BANK.

     2.1 Loans.

          (a) Loan Commitment. Subject to the terms and conditions of this Agreement and the other Loan Documents, and in reliance upon the representations and warranties of the Borrower set forth herein and in the other Loan Documents, the Bank agrees to make such Loans at such times as the Borrower may from time to time request until, but not including, the Maturity Date, and in such amounts as the Borrower may from time to time request, provided, however, that the aggregate principal balance of all Loans outstanding at any time shall not exceed the Loan Commitment. Loans made by the Bank may be repaid and, subject to the terms and conditions hereof, borrowed again up to, but not including the Maturity Date unless the Loans are otherwise terminated or extended as provided in this Agreement.

          (b) Loan Interest and Payments. Except as otherwise provided in this Section 2.1(b), the principal amount of the Loans outstanding from time to time shall bear interest at the Interest Rate. Accrued and unpaid interest on the unpaid principal balance of Prime Loans outstanding from time to time shall be due and payable quarterly, in arrears, commencing on January 31, 2002 and continuing on the 31st day of each April, July, October and January thereafter, and on the Maturity Date. Accrued and unpaid interest on the unpaid principal amount of LIBOR Loans outstanding from time to time shall be payable on the last Business Day of each Interest Period, or if a six-month Interest Period applies, then after three months and on the last Business Day of such Interest Period, commencing on the first such date to occur after the date hereof, on the date of any principal repayment of a LIBOR Loan and on the Maturity Date. Any amount of principal or interest on the Loans which is not paid when due, whether at stated maturity, by acceleration or otherwise, shall bear interest payable on demand at the Default Rate.

          (c) Loan Principal Repayments.

     (i) Mandatory Principal Prepayments. All Loans hereunder shall be repaid by the Borrower on the Maturity Date, unless payable sooner pursuant to the provisions of this Agreement. If the Borrower chooses not to convert any Loan which is a LIBOR Loan to a Prime Loan as provided in Section 2.2(b) and Section 2.2(c), then such Loan shall be immediately due and payable on the last Business Day of the then existing Interest Period or on such earlier date as required by law, all without further demand, presentment, protest or notice of any kind, all of which are hereby waived by the Borrower.

     (ii) Optional Prepayments. In addition to the Mandatory Prepayment, the Borrower may from time to time prepay the Loans which are Prime Loans, in whole or in part, without any prepayment penalty whatsoever, subject to the following conditions: (i) each partial prepayment shall be in an amount equal to $10,000.00 or a higher integral multiple of $5,000; and (ii) any prepayment of the entire principal balance of

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the Prime Loans shall include accrued interest on such Prime Loans to the date of such prepayment and payment in full of all other Obligations (other than the LIBOR Loans), then due and payable.

     2.2 Additional LIBOR Loan Provisions.

          (a) LIBOR Loan Prepayments. Notwithstanding anything to the contrary contained herein, the principal balance of any LIBOR Loan may not be prepaid in whole or in part at any time. If, for any reason, a LIBOR Loan is paid prior to the last Business Day of any Interest Period, the Borrower agrees to indemnify the Bank against any loss (including any loss on redeployment of the funds repaid), cost or expense incurred by the Bank as a result of such prepayment.

          (b) LIBOR Unavailability. If the Bank determines in good faith (which determination shall be conclusive, absent manifest error) prior to the commencement of any Interest Period that (i) United States dollar deposits of sufficient amount and maturity for funding any LIBOR Loan are not available to the Bank in the London Interbank Eurodollar market in the ordinary course of business, or (ii) by reason of circumstances affecting the London Interbank Eurodollar market, adequate and fair means do not exist for ascertaining the rate of interest to be applicable to the relevant LIBOR Loan, the Bank shall promptly notify the Borrower thereof and, so long as the foregoing conditions continue, Loans may not be advanced as a LIBOR Loan thereafter. In addition, at the Borrower’s option, each existing LIBOR Loan shall be immediately (i) converted to a Prime Loan on the last Business Day of the then existing Interest Period, or (ii) due and payable on the last Business Day of the then existing Interest Period, without further demand, presentment, protest or notice of any kind, all of which are hereby waived by the Borrower.

          (c) Regulatory Change. In addition, if, after the date hereof, a Regulatory Change shall, in the reasonable determination of the Bank, make it unlawful for the Bank to make or maintain the LIBOR Loans, then the Bank shall promptly notify the Borrower and Loans may not be advanced as a LIBOR Loan thereafter. In addition, at the Borrower’s option, each existing LIBOR Loan shall be immediately (i) converted to a Prime Loan on the last Business Day of the then existing Interest Period or on such earlier date as required by law, or (ii) due and payable on the last Business Day of the then existing Interest Period or on such earlier date as required by law, all without further demand, presentment, protest or notice of any kind, all of which are hereby waived by the Borrower.

          (d) LIBOR Loan Indemnity. If any Regulatory Change (whether or not having the force of law) shall (a) impose, modify or deem applicable any’ assessment, reserve, special deposit or similar requirement against assets held by, or deposits in or for the account of or loans by, or any other acquisition of funds or disbursements by, the Bank; (b) subject the Bank or any LIBOR Loan to any tax, duty, charge, stamp tax or fee or change the basis of taxation of payments to the Bank of principal or interest due from the Borrower to the Bank hereunder (other than a change in the taxation of the overall net income of the Bank); or (c) impose on the Bank any other condition regarding such LIBOR Loan or the Bank’s funding thereof, and the Bank shall determine (which determination shall be conclusive, absent manifest error) that the result of the foregoing is to increase the cost to the Bank of making or maintaining such LIBOR Loan or to reduce the amount of principal or interest received by the Bank hereunder, then the Borrower shall pay to the Bank, on demand, such additional amounts as the Bank shall, from time to time, determine are sufficient to compensate and indemnify the Bank for such increased cost or reduced amount.

     2.4 Interest Computation; Collection of Funds. Except as otherwise set forth herein, all interest shall be calculated on the basis of a year consisting of 360 days and shall be paid for the actual number of days elapsed. Principal payments submitted in funds not immediately available shall continue to bear interest until collected. If any payment to be made by the Borrower hereunder or under the Note

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shall become due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day and such extension of time shall be included in computing any interest in respect of such payment.

3. CONDITIONS OF BORROWING.

     Notwithstanding any other provision of this Agreement, the Bank shall not be required to disburse or make all or any portion of the Loans if any of the following conditions shall have occurred.

     3.1 Loan Documents. The Borrower shall have failed to execute and deliver to the Bank any of the following Loan Documents (collectively, the “Loan Documents”), all of which must be satisfactory to the Bank and the Bank’s counsel in form, substance and execution:

          (a) Loan Agreement. One copy of this Agreement duly executed by the Borrower.

          (b) Revolving Note. A Revolving Note duly executed by the Borrower, in the form attached hereto as Exhibit “A”.

          (c) Pledge Agreement. A Stock Pledge Agreement duly executed by the Borrower, in the form attached hereto as Exhibit “B” (the “Pledge Agreement”).

          (d) Collateral. Stock certificates and related stock powers as required under the Pledge Agreement.

          (e) Resolutions. Resolutions of the board of directors and/or shareholders of the Borrower authorizing the execution of this Agreement and the Loan Documents.

          (f) Additional Documents. Such other certificates, financial statements, schedules, resolutions, opinions of counsel, notes and other documents which are provided for hereunder or which the Bank shall require.

     3.2 Event of Default. Any Event of Default, or any event which, with notice or lapse of time, or both would constitute an Event of Default, shall have occurred and be continuing.

     3.3 Adverse Changes. An adverse change in the financial condition or affairs of the Borrower, as determined in the Bank’s sole and complete discretion, shall have occurred.

     3.4 Litigation. Any litigation or governmental proceeding shall have been instituted against the Borrower or any of its officers or shareholders which in the discretion of the Bank, reasonably exercised, adversely affects the financial condition or continued operation of the Borrower.

     3.5 Representations and Warranties. Any representation or warranty of the Borrower contained herein or in any Loan Document shall be untrue or incorrect as of the date of any Loan as though made on such date, except to the extent such representation or warranty expressly relates to an earlier date.

4. NOTE EVIDENCING LOANS.

     The Loans shall be evidenced by a single Revolving Note (together with any and all renewal, extension, modification or replacement notes executed by the Borrower and delivered to the Bank and given in substitution therefor, the “Revolving Note”) in the form of Exhibit “A” attached hereto, duly executed by the Borrower and payable to the order of the Bank. At the time of the initial disbursement of a Loan and at each time an additional Loan shall be requested hereunder or a repayment made in whole

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or in part thereon, an appropriate notation thereof shall be made on the books and records of the Bank. All amounts recorded shall be, absent demonstrable error, conclusive and binding evidence of (i) the principal amount of the Loans advanced hereunder, (ii) any unpaid interest owing on the Loans, and (iii) all amounts repaid on the Loans. The failure to record any such amount or any error in recording such amounts shall not, however, limit or otherwise affect the obligations of the Borrower under the Revolving Note to repay the principal amount of the Loans, together with all interest accruing thereon.

5. MANNER OF BORROWING.

     Each Loan shall be made available to the Borrower upon its request, from any Person whose authority to so act has not been revoked by the Borrower in writing previously received by the Bank. Each Loan may be advanced either as a Prime Loan or a LIBOR Loan. A request for a Prime Loan must be received by no later than 11:00 a.m. Chicago, Illinois time, on the day it is to be funded. A request for a LIBOR Loan must be received by no later than 11:00 a.m. Chicago, Illinois time, three days before the day it is to be funded. If for any reason the Borrower shall fail to select timely an Interest Period for an existing LIBOR Loan, then such LIBOR Loan shall be immediately converted to a Prime Loan on the last Business Day of the then existing Interest Period, all without demand, presentment, protest or notice of any kind, all of which are hereby waived by the Borrower. The proceeds of each Prime Loan or LIBOR Loan shall be made available at the office of the Bank by credit to the account of the Borrower or by other means requested by the Borrower and acceptable to the Bank.

     The Bank is authorized to rely on any written, verbal, electronic, telephonic or telecopy loan requests which the Bank believes in its good faith judgment to emanate from a properly authorized representative of the Borrower, whether or not that is in fact the case. The Borrower does hereby irrevocably confirm, ratify and approve all such advances by the Bank and does hereby indemnify the Bank against losses and expenses (including court costs, attorneys’ and paralegals’ fees) and shall hold the Bank harmless with respect thereto.

6. REPRESENTATIONS AND WARRANTIES.

     To induce the Bank to make the Loans, the Borrower makes the following representations and warranties to the Bank, each of which shall be true and correct as of the date of the execution and delivery of this Agreement, and which shall survive the execution and delivery of this Agreement:

     6.1 Borrower Organization and Name. The Borrower is a corporation duly organized, existing and in good standing under the laws of the State of Delaware, with full and adequate corporate power to carry on and conduct its business as presently conducted. The Borrower is duly licensed or qualified in all foreign jurisdictions wherein the nature of its activities require such qualification or licensing. The exact legal name of the Borrower is as set forth in the first paragraph of this Agreement, and the Borrower currently does not conduct, nor has it during the last five (5) years conducted, business under any other name or trade name.

     6.2 Authorization: Validity. The Borrower has full right, power and authority to enter into this Agreement, to make the borrowings and execute and deliver the Loan Documents as provided herein and to perform all of its duties and obligations under this Agreement and the Loan Documents. The execution and delivery of this Agreement and the Loan Documents will not, nor will the observance or performance of any of the matters and things herein or therein set forth, violate or contravene any provision of law or of the articles of incorporation or bylaws of the Borrower. All necessary and appropriate corporate action has been taken on the part of the Borrower to authorize the execution and delivery of this Agreement and the Loan Documents. This Agreement and the Loan Documents are valid and binding agreements and contracts of the Borrower in accordance with their respective terms.

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     6.3 Compliance With Laws. The nature and transaction of the Borrower’s business and operations and the use of its properties and assets, including, but not limited to, the Collateral or any real estate owned or occupied by the Borrower, do not and during the term of the Loans shall not, violate or conflict with any applicable law, statute, ordinance, rule, regulation or order of any kind or nature.

     6.4 Absence of Breach. The execution, delivery and performance of this Agreement, the Loan Documents and any other documents or instruments to be executed and delivered by the Borrower in connection with the Loans shall not: (i) violate any provisions of law or any applicable regulation, order, writ, injunction or decree of any court or governmental authority, or (ii) conflict with, be inconsistent with, or result in any breach or default of any of the terms, covenants, conditions, or provisions of any indenture, mortgage, deed of trust, instrument, document, agreement or contract of any kind to which the Borrower is a party or by which the Borrower or any of its property or assets may be bound.

     6.5 Financial Statements. All financial statements submitted to the Bank have been prepared in accordance with GAAP on a basis, except as otherwise noted therein, consistent with the previous fiscal year and truly and accurately reflect the financial condition of the Borrower and the results of the operations for the Borrower as of such date and for the periods indicated. Since the date of the most recent financial statement submitted by the Borrower to the Bank, there has been no material adverse change in the financial condition or in the assets or liabilities of the Borrower, or any changes except those occurring in the ordinary course of business.

     6.6 Litigation and Taxes. There is no litigation, demand, charge, claim, petition or governmental investigation or proceeding pending, or threatened, against the Borrower, which, if adversely determined, would result in any material adverse change in the financial condition or properties, business or operations of the Borrower. The Borrower has duly filed all applicable income or other tax returns and has paid all income or other taxes when due. There is no controversy or objection pending, or threatened in respect of any tax returns of the Borrower.

     6.7 Event of Default. No Event of Default has occurred and is continuing, and no event has occurred and is continuing which, with the lapse of time, the giving of notice, or both, would constitute such an Event of Default under this Agreement or any of the Loan Documents and the Borrower is not in default (without regard to grace or cure periods) under any contract or agreement to which it is a party.

     6.8 Adverse Circumstances. No condition, circumstance, event, agreement, document, instrument, restriction, litigation or proceeding (or threatened litigation or proceeding or basis therefor) exists which (a) could adversely affect the validity or priority of the Liens granted to the Bank under the Loan Documents, (b) could materially adversely affect the ability of the Borrower to perform its obligations under the Loan Documents, (c) would constitute a default under any of the Loan Documents, or (d) would constitute such a default with the giving of notice or lapse of time or both.

     6.9 Compliance with Regulation U. No portion of the proceeds of the Loans shall be used by the Borrower, or any affiliates of the Borrower, either directly or indirectly, for the purpose of purchasing or carrying any margin stock, within the meaning of Regulation U as adopted by the Board of Governors of the Federal Reserve System.

     6.10 Complete Information. This Agreement and all financial statements, schedules, certificates, confirmations, agreements, contracts, and other materials submitted to the Bank in connection with or in furtherance of this Agreement by or on behalf of the Borrower fully and fairly state the matters with which they purport to deal, and neither misstate any material fact nor, separately or in the aggregate, fail to state any material fact necessary to make the statements made not misleading.

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7. NEGATIVE COVENANTS.

     7.1 Transfer; Merger. The Borrower shall not, either directly or indirectly, merge, consolidate, sell, transfer, license, lease, encumber or otherwise dispose of all or any part of its property or business or all or any substantial part of its assets except as necessary to complete the acquisition and merger of Farmers State Bank and Community Bank on or about November 1, 2001, as described in writing to the Bank.

     7.2 Change of Legal Status. The Borrower shall not change its name, its organizational identification number, if it has one, its type of organization, its jurisdiction of organization or other legal structure.

8. AFFIRMATIVE COVENANTS.

     8.1 Compliance with Bank Regulatory Requirements. Upon demand by the Bank, the Borrower shall reimburse the Bank for the Bank’s additional costs and/or reductions in the amount of principal or interest received or receivable by the Bank if at any time after the date of this Agreement any law, treaty or regulation or any change in any law, treaty or regulation or the interpretation thereof by any governmental authority charged with the administration thereof or any central bank or other fiscal, monetary or other authority having jurisdiction over the Bank or the Loans, whether or not having the force of law, shall impose, modify or deem applicable any reserve (except reserve requirements taken into account in calculating the Interest Rate and/or special deposit requirement against or in respect of assets held by or deposits in or for the account of the Loans by the Bank or impose on the Bank any other condition with respect to this Agreement or the Loans, the result of which is to either increase the cost to the Bank of making or maintaining the Loans or to reduce the amount of principal or interest received or receivable by the Bank with respect to such Loans. Said additional costs and/or reductions will be those which directly result from the imposition of such requirement or condition on the making or maintaining of such Loans. All Loans shall be deemed to be match funded for the purposes of the Bank’s determination in the previous sentence. Notwithstanding the foregoing, the Borrower shall not be required to pay any such additional costs which could be avoided by the Bank with the exercise of reasonable conduct and diligence.

     8.2 Financial Statements. The Borrower shall at all times maintain a standard and modem system of accounting, on the accrual basis of accounting and in all respects in accordance with GAAP, and shall furnish to the Bank or its authorized representatives such information regarding the business affairs, operations and financial condition of the Borrower, including, but not limited to:

          (a) as soon as available, and in any event, within ninety (90) days after the close of each of its fiscal years, a copy of the annual audited financial statements of the Borrower, including balance sheet, statement of income and retained earnings, statement of cash flows for the fiscal year then ended and such other information (including nonfinancial information) as the Bank may request, in reasonable detail, prepared and certified by an independent certified public accountant acceptable to the Bank, containing an unqualified opinion; and

          (b) as soon as available, and in any event, within thirty (30) days following the end of each fiscal quarter, a copy of the financial statements of the Borrower regarding such fiscal quarter, including balance sheet, statement of income and retained earnings, statement of cash flows for the fiscal quarter then ended and such other information (including nonfinancial information) as the Bank may request, in reasonable detail, prepared and certified as accurate by the Borrower.

     No change with respect to such accounting principles shall be made by the Borrower without giving prior notification to the Bank. The Borrower represents and warrants to the Bank that the

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financial statements delivered to the Bank at or prior to the execution and delivery of this Agreement and to be delivered at all times thereafter accurately reflect and will accurately reflect the financial condition of the Borrower. The Bank shall have the right at all times during business hours to inspect the books and records of the Borrower and make extracts therefrom. The Borrower agrees to advise the Bank immediately of any adverse change in the financial condition, the operations or any other status of the Borrower.

     8.3 Supplemental Financial Statements. The Borrower shall immediately upon receipt thereof, provide to the Bank copies of interim and supplemental reports if any, submitted to the Borrower by independent accountants in connection with any interim audit or review of the books of the Borrower.

     8.4 Notice of Proceedings. The Borrower shall, immediately after knowledge thereof shall have come to the attention of any officer of the Borrower, give written notice to the Bank of all threatened or pending actions, suits, and proceedings before any court or governmental department, commission, board or other administrative agency which may have a material effect on the business, property or operations of the Borrower.

     8.5 Notice of Default. The Borrower shall, immediately after the commencement thereof, give notice to the Bank in writing of the occurrence of an Event of Default or of any event which, with the lapse of time, the giving of notice or both, would constitute an Event of Default hereunder.

9. EVENTS OF DEFAULT.

     The Borrower, without notice or demand of any kind, shall be in default under this Agreement upon the occurrence of any of the following events (each an “Event of Default”).

     9.1 Nonpayment of Obligations. Any amount due and owing on the Note or any of the Obligations, whether by its terms or as otherwise provided herein, is not paid when due.

     9.2 Misrepresentation. Any oral or written warranty, representation, certificate or statement in this Agreement, the Loan Documents or any other agreement with the Bank shall be false when made or at any time.

     9.3 Nonperformance. Any failure to perform or default in the performance of any covenant, condition or agreement contained in this Agreement, or in the Loan Documents or any other agreement with the Bank.

     9.4 Default under Loan Documents. A default under any of the other Loan Documents, all of which covenants, conditions and agreements contained therein are hereby incorporated in this Agreement by express reference, shall be and constitute an Event of Default under this Agreement and any other of the Obligations.

     9.5 Default under Other Agreements. Any default in the payment of principal, interest or any other sum for any other obligation beyond any period of grace provided with respect thereto or in the performance of any other term, condition or covenant contained in any agreement (including, but not limited to any capital or operating lease or any agreement in connection with the deferred purchase price of property) under which any such obligation is created, the effect of which default is to cause or permit the holder of such obligation (or the other party to such other agreement) to cause such obligation to become due prior to its stated maturity or terminate such other agreement.

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     9.6 Assignment for Creditors. The Issuer or any Obligor makes an assignment for the benefit of creditors, fails to pay, or admits in writing its inability to pay its debts as they mature; or if a trustee of any substantial part of the assets of the Issuer or any Obligor is applied for or appointed, and in the case of such trustee being appointed in a proceeding brought against such Issuer or Obligor, the Issuer or the Obligor, by any action or failure to act indicates its approval of, consent to, or acquiescence in such appointment and such appointment is not vacated, stayed on appeal or otherwise shall not have ceased to continue in effect within thirty (30) days after the date of such appointment.

     9.7 Bankruptcy. Any proceeding involving the Issuer or any Obligor, is commenced by or against such Issuer or Obligor under any bankruptcy, reorganization, arrangement, insolvency, readjustment of debt, dissolution or liquidation law or statute of the federal government or any state government, and in the case of any such proceeding being instituted against such Issuer or Obligor, (i) the Issuer or such Obligor, by any action or failure to act indicates its approval of, consent to or acquiescence therein, or (ii) an order shall be entered approving the petition in such proceedings and such order is not vacated, stayed on appeal or otherwise shall not have ceased to continue in effect within thirty (30) days after the entry thereof.

     9.8 Judgments. The entry of any judgment, decree, levy, attachment, garnishment or other process, or the filing of any lien against any Obligor which is not fully covered by insurance and which judgment or other process would have a material adverse effect on the ability of the Borrower or any Obligor to perform under this Agreement or under any other agreement between such Obligor and the Bank and such judgment or other process shall not have been, within thirty (30) days from the entry thereof, (i) bonded over to the satisfaction of the Bank and appealed, (ii) vacated, or (iii) discharged.

     9.9 Change in Control. Any sale, conveyance, assignment or other transfer, directly or indirectly, of any ownership interest of the Borrower (other than the issuance of $10,000,000 in trust preferred shares on or about November 1, 2001), which results in any change in the identity of the individuals or entities previously in control of the Borrower or the grant of a security interest in any ownership interest of any Person, directly or indirectly controlling the Borrower, which could result in a change in the identity of the individuals or entities previously in control of the Borrower. For the purpose hereof, the terms “control” or “controlling” shall mean the possession of the power to direct, or cause the direction of, the management and policies of the Borrower by contract or voting of securities.

     9.10 Collateral Impairment. The entry of any judgment, decree, levy, attachment, garnishment or other process, or the filing of any lien against, any of the collateral under the Pledge Agreement or any collateral under any other security agreement securing any of the Obligations (the “Collateral”), or any material decline or depreciation in the value or market price of the Collateral (whether actual or reasonably anticipated), which causes the Collateral, in the sole opinion of the Bank acting in good faith, to become unsatisfactory as to value or character, or which causes the Bank to reasonably believe that it is insecure and that the likelihood for repayment of the Obligations is or will soon be impaired, time being of the essence.

     9.11 Adverse Event. The occurrence of any adverse event which causes a change in the financial condition of the Borrower, or which would have a material adverse effect on the business of the Borrower.

     9.12 Adverse Financial Change. The determination by the Bank that an adverse change has occurred in the financial condition of the Borrower from the condition set forth in the most recent financial statement of the Borrower furnished to the Bank, or from the financial condition of the Borrower most recently disclosed to the Bank in any manner.

     9.13 Insecurity. The Bank in good faith believes that it is insecure.

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10. REMEDIES.

     Upon the occurrence of an Event of Default, the Bank shall have all rights, powers and remedies set forth in the Loan Documents, in any written agreement or instrument (other than this Agreement or the Loan Documents) relating to any of the Obligations or any security therefor, or as otherwise provided at law or in equity. Without limiting the generality of the foregoing, the Bank may, at its option upon the occurrence of an Event of Default, declare its commitments to the Borrower to be terminated and all Obligations to be immediately due and payable, provided, however, that upon the occurrence of an Event of Default under either Section 9.6, “Assignment for Creditors”, or Section 9.7, “Bankruptcy”, all commitments of the Bank to the Borrower shall immediately terminate and all Obligations shall be automatically due and payable, all without demand, notice or further action of any kind required on the part of the Bank. The Borrower hereby waives any and all presentment, demand, notice of dishonor, protest, and all other notices and demands in connection with the enforcement of Bank’s rights under the Loan Documents, and hereby consents to, and waives notice of release, with or without consideration, of any Collateral, notwithstanding anything contained herein or in the Loan Documents to the contrary. In addition to the foregoing:

     10.1 Security Interest. The Bank may, without notice, demand or legal process of any kind exercise any or all of its rights to the Collateral or otherwise under the Pledge Agreement.

     10.2 UCC and Offset Rights. The Bank may exercise, from time to time, any and all rights and remedies available to it under the UCC or under any other applicable law in addition to, and not in lieu of, any rights and remedies expressly. granted in this Agreement, the Pledge Agreement or in any other agreements between any Obligor and the Bank, and may, without demand or notice of any kind, appropriate and apply toward the payment of such of the Obligations, whether matured or unmatured, including costs of collection and attorneys’ and paralegals’ fees, and in such order of application as the Bank may, from time to time, elect, any indebtedness of the Bank to any Obligor, however created or arising, including, but not limited to, balances, credits, deposits, accounts or moneys of such Obligor in the possession, control or custody of, or in transit to the Bank. The Borrower, on behalf of itself and each Obligor, hereby waives the benefit of any law that would otherwise restrict or limit the Bank in the exercise of its right, which is hereby acknowledged, to appropriate at any time hereafter any such indebtedness owing from the Bank to any Obligor.

     10.3 No Waiver. No Event of Default shall be waived by the Bank except in writing. No failure or delay on the part of the Bank in exercising any right, power or remedy hereunder shall operate as a waiver of the exercise of the same or any other right at any other time; nor shall any single or partial exercise of any such right, power or remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy hereunder. There shall be no obligation on the part of the Bank to exercise any remedy available to the Bank in any order. The remedies provided for herein are cumulative and not exclusive of any remedies provided at law or in equity. The Borrower agrees that in the event that the Borrower fails to perform, observe or discharge any of its Obligations or liabilities under this Agreement or any other agreements with the Bank, no remedy of law will provide adequate relief to the Bank, and further agrees that the Bank shall be entitled to temporary and permanent injunctive relief in any such case without the necessity of proving actual damages.

11. MISCELLANEOUS.

     11.1 Obligations Absolute. None of the following shall affect the Obligations of the Borrower to the Bank under this Agreement or the Bank’s rights with respect to the Collateral:

          (a) acceptance or retention by the Bank of other property or any interest in property as security for the Obligations;

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          (b) release by the Bank of all or any part of the Collateral or of any party liable with respect to the Obligations;

          (c) release, extension, renewal, modification or substitution by the Bank of the Note, or any note evidencing any of the Obligations, or the compromise of the liability of any guarantor of the Obligations; or

          (d) failure of the Bank to resort to any other security or to pursue the Borrower or any other Obligor liable for any of the Obligations before resorting to remedies against the Collateral.

     11.2 Entire Agreement. This Agreement (i) is valid, binding and enforceable against the Borrower and the Bank in accordance with its provisions and no conditions exist as to its legal effectiveness; (ii) constitutes the entire agreement between the parties; and (iii) is the final expression of the intentions of the Borrower and the Bank. No promises, either expressed or implied, exist between the Borrower and the Bank, unless contained herein. This Agreement supersedes all negotiations, representations, warranties, commitments, offers, contracts (of any kind or nature, whether oral or written) prior to or contemporaneous with the execution hereof.

     11.3 Amendments; Waivers. No amendment, modification, termination, discharge or waiver of any provision of this Agreement or of the Loan Documents, or consent to any departure by the Borrower therefrom, shall in any event be effective unless the same shall be in writing and signed by the Bank, and then such waiver or consent shall be effective only for the specific purpose for which given.

     11.4 WAIVER OF DEFENSES. THE BORROWER, ON BEHALF OF ITSELF AND ANY OTHER OBLIGORS OF ANY OF THE OBLIGATIONS, WANES EVERY PRESENT AND FUTURE DEFENSE, CAUSE OF ACTION, COUNTERCLAIM OR SETOFF WHICH THE BORROWER MAY NOW HAVE OR HEREAFTER MAY HAVE TO ANY ACTION BY THE BANK IN ENFORCING THIS AGREEMENT: THE BORROWER WAIVES ANY IMPLIED COVENANT OF GOOD FAITH AND RATIFIES AND CONFIRMS WHATEVER THE BANK MAY DO PURSUANT TO THE TERMS OF THIS AGREEMENT. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE BANK GRANTING ANY FINANCIAL ACCOMMODATION TO THE BORROWER.

     11.5 WAIVER OF JURY TRIAL. THE BANK AND THE BORROWER, AFTER CONSULTING OR HAVING HAD THE OPPORTUNITY TO CONSULT WITH COUNSEL, EACH KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE IRREVOCABLY, THE RIGHT TO TRIAL BY JURY WITH RESPECT TO ANY LEGAL PROCEEDING BASED HEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT, THE NOTE OR ANY OF THE OTHER OBLIGATIONS, THE COLLATERAL, OR ANY OTHER AGREEMENT EXECUTED OR CONTEMPLATED TO BE EXECUTED IN CONJUNCTION WITH THIS AGREEMENT, OR ANY COURSE OF CONDUCT OR COURSE OF DEALING IN WHICH THE BANK AND THE BORROWER ARE ADVERSE PARTIES. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE BANK GRANTING ANY FINANCIAL ACCOMMODATION TO THE BORROWER.

     11.6 LITIGATION. TO INDUCE THE BANK TO MAKE THE LOANS, THE BORROWER IRREVOCABLY AGREES THAT ALL ACTIONS ARISING, DIRECTLY OR INDIRECTLY, AS A RESULT OR CONSEQUENCE OF THIS AGREEMENT, THE NOTE, ANY OTHER AGREEMENT WITH THE BANK OR THE COLLATERAL, SHALL BE INSTITUTED AND LITIGATED ONLY IN COURTS HAVING THEIR SITUS IN THE CITY OF CHICAGO, ILLINOIS. THE BORROWER HEREBY CONSENTS TO THE EXCLUSIVE JURISDICTION AND VENUE OF ANY STATE OR FEDERAL COURT HAVING ITS SITUS IN SAID CITY, AND WAIVES ANY OBJECTION BASED ON FORUM NON CONVENIENS. THE BORROWER

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HEREBY WANES PERSONAL SERVICE OF ANY AND ALL PROCESS AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED, DIRECTED TO THE BORROWER AS SET FORTH HEREIN IN THE MANNER PROVIDED BY APPLICABLE STATUTE, LAW, RULE OF COURT OR OTHERWISE.

     11.7 Assignability. The Bank may at any time assign the Bank’s rights in this Agreement, the Note, the Pledge Agreement, the Obligations, or any part thereof and transfer the Bank’s rights in any or all of the Collateral, and the Bank thereafter shall be relieved from all liability with respect to such Collateral. In addition, the Bank may at any time sell one or more participation in the Loans. The Borrower may not sell or assign this Agreement, or any other agreement with the Bank or any portion thereof, either voluntarily or by operation of law, without the prior written consent of the Bank. This Agreement shall be binding upon the Bank and the Borrower and their respective legal representatives and successors. All references herein to the Borrower shall be deemed to include any successors, whether immediate or remote.

     11.8 Governing Law. This Agreement, the Loan Documents and the Note shall be delivered and accepted in and shall be deemed to be contracts made under and governed by the internal laws of the State of Illinois (but giving effect to federal laws applicable to national banks), and for all purposes shall be construed in accordance with the laws of such State, without giving effect to the choice of law provisions of such State.

     11.9 Enforceability. Wherever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement shall be prohibited by, unenforceable or invalid under any jurisdiction, such provision shall as to such jurisdiction, be severable and be ineffective to the extent of such prohibition or invalidity, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction.

     11.10 Survival of Borrower Representations. All covenants, agreements, representations and warranties made by the Borrower herein shall, notwithstanding any investigation by the Bank, be deemed material and relied upon by the Bank and shall survive the making and execution of this Agreement and the Loan Documents and the issuance of the Notes, and shall be deemed to be continuing representations and warranties until such time as the Borrower has fulfilled all of its Obligations to the Bank, and the Bank has been paid in fall. The Bank, in extending financial accommodations to the Borrower, is expressly acting and relying on the aforesaid representations and warranties.

     11.11 Extensions of Bank’s Commitment and Note. This Agreement shall secure and govern the terms of any extensions or renewals of the Bank’s commitment hereunder and the Note pursuant to the execution of any modification, extension or renewal note executed by the Borrower and accepted by the Bank in its sole and absolute discretion in substitution for the Note.

     11.12 Time of Essence. Time is of the essence in making payments of all amounts due the Bank under this Agreement and in the performance and observance by the Borrower of each covenant, agreement, provision and term of this Agreement.

     11.13 Counterparts. This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which taken together shall constitute one and the same instrument.

     11.14 Facsimile Signatures. The Bank is hereby authorized to rely upon and accept as an original any Loan Documents or other communication which is sent to the Bank by facsimile, telegraphic or other electronic transmission (each, a “Communication”) which the Bank in good faith

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believes has been signed by Borrower and has been delivered to the Bank by a properly authorized representative of the Borrower, whether or not that is in fact the case. Notwithstanding the foregoing, the Bank shall not be obligated to accept any such Communication as an original and may in any instance require that an original document be submitted to the Bank in lieu of, or in addition to, any such Communication.

     11.15 Notices. Except as otherwise provided herein, the Borrower waives all notices and demands in connection with the enforcement of the Bank’s rights hereunder. All notices, requests, demands and other communications provided for hereunder shall be in writing, sent by certified or registered mail, postage prepaid, by facsimile, telegram or delivered in person, and addressed as follows:

If to the Borrower:	Metrocorp, Inc.
	1523 8th Street
	East Moline, Illinois 61244-2116
	Attention: Gary Andersen
If to the Bank:	LaSalle Bank National Association
	135 South La Salle Street
	Chicago, Illinois 60603
	Attention: Delmar Rogers, Jr.

or, as to each party, at such other address as shall be designated by such party in a written notice to each other party complying as to delivery with the terms of this subsection. No notice to or demand on the Borrower in any case shall entitle the Borrower to any other or further notice or demand in similar or other circumstances.

     11.16 Indemnification. The Borrower agrees to defend (with counsel satisfactory to the Bank), protect, indemnify and hold harmless each Indemnified Party from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, claims, costs, expenses and distributions of any kind or nature (including, without limitation, the disbursements and the reasonable fees of counsel for each Indemnified Party thereto, which shall also include, without limitation, attorneys’ fees and time charges of attorneys who may be employees of the Bank, any parent corporation or affiliated corporation of the Bank), which may be imposed on, incurred by, or asserted against, any Indemnified Party (whether direct, indirect or consequential and whether based on any federal, state or local laws or regulations, including, without limitation, securities, environmental laws and commercial laws and regulations, under common law or in equity, or based on contract or otherwise) in any manner relating to or arising out of this Agreement or any of the Loan Documents, or any act, event or transaction related or attendant thereto, the preparation, execution and delivery of this Agreement and the Loan Documents, including, but not limited to, the making or issuance and management of the Loans, the use or intended use of the proceeds of the Loans, the enforcement of the Bank’s rights and remedies under this Agreement, the Loan Documents, the Note, any other instruments and documents delivered hereunder, or under any other agreement between the Borrower and the Bank; provided, however, that the Borrower shall not have any obligations hereunder to any Indemnified Party with respect to matters caused by or resulting from the willful misconduct or gross negligence of such Indemnified Party. To the extent that the undertaking to indemnify set forth in the preceding sentence may be unenforceable because it violates any law or public policy, the Borrower shall satisfy such undertaking to the maximum extent permitted by applicable law. Any liability, obligation, loss, damage, penalty, cost or expense covered by this indemnity shall be paid to each Indemnified Party on demand, and, failing prompt payment, shall, together with interest thereon at the Default Rate from the date incurred by each Indemnified Party until paid by the Borrower, be added to the Obligations of the Borrower and be secured by the Collateral. The provisions of this Section 11.16 shall survive the satisfaction and payment of the other Obligations and the termination of this Agreement.

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     IN WITNESS WHEREOF, the Borrower and the Bank have executed this Loan Agreement as of the date first above written.

	METROCORP, INC., a Delaware corporation
ATTEST:
/s/ Jay Van Paemel, Secretary	/s/ Gary D. Andersen, President
	Agreed and accepted:
	LASALLE BANK NATIONAL ASSOCIATION, a national banking association
	/s/ Delmar Rogers, Jr., First VP

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FIRST AMENDMENT TO LOAN AGREEMENT

     This FIRST AMENDMENT TO LOAN AGREEMENT dated as of November 30, 2001 (the “First Amendment”), is entered into by and between METROCORP, INC., a Delaware corporation (the “Borrower”), whose address is 1523 8th Street, East Moline, Illinois 61244 and LASALLE BANK NATIONAL ASSOCIATION, a national banking association (the “Bank’’), whose address is 135 South LaSalle Street, Chicago, Illinois 60603.

RECITALS:

     A. The Borrower and the Bank entered into that certain Loan Agreement dated as of November 1, 2001 (the “Loan Agreement”), pursuant to which Loan Agreement the Bank has made a Revolving Loan to the Borrower evidenced by that certain Revolving Note dated as of November 1, 2001 in the maximum principal amount of Ten Million and 00/100 Dollars ($10,000,000.00), executed by the Borrower and made payable to the order of the Bank (the “Revolving Note”).

     B. At the present time the Borrower requests, and the Bank is agreeable to an extension of the Maturity Date, the making of certain principal installments and the observation of certain covenants, pursuant to and conditioned on the terms and conditions hereinafter set forth.

     NOW THEREFORE, in consideration of the premises and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Borrower and the Bank hereby agree as follows:

AGREEMENTS:

     1. RECITALS. The foregoing Recitals are hereby made a part of this First Amendment.

     2. DEFINITIONS. Capitalized words and phrases used herein without definition shall have the respective meanings ascribed to such words and phrases in the Loan Agreement.

     3. AMENDMENTS TO THE LOAN AGREEMENT.

          3.1 Fixed Rate Definitions. The following definitions shall be added to Section 1.1 of the Loan Agreement:

“Adjusted Rate’ shall mean a rate per annum equal to the sum of (A) an amount determined by the Bank, in its sole discretion, based upon the spread on the then current swap rate as reported on Bloomberg’s Financial Market’s Commodities News for a period as requested by the Borrower not to exceed five (5) years (the “Applicable Period”), and (B) two percent (2.00%). Such interest rate shall be based upon the Adjusted Rate in effect three (3) Business Days prior to the first date of the Applicable Period.

‘Adjusted-Rate Loan’ or ‘Adjusted-Rate Loans’ shall mean that portion, and collectively those portions, of the aggregate outstanding principal balance of the Loans that will bear interest at the Adjusted Rate.”

          3.2 Loan Definition. The definition of “Loans” in Section 1.1 of the Loan Agreement is hereby amended in its entirety to read as follows:

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\

“Loans’ shall mean, collectively, all Loans (whether Prime Loans, LIBOR Loans or Adjusted-Rate Loans) made by the Bank to the Borrower, under and pursuant to this Agreement.”

          3.3 Maturity Date Definition. The definition of “Maturity Date” in Section 1.1 of the Loan Agreement is hereby amended in its entirety to read as follows:

“Maturity Date’ shall mean July 24, 2008, unless extended by the Bank pursuant to any modification, extension or renewal note executed by the Borrower and accepted by the Bank in its sole and absolute discretion in substitution for the Revolving Note.”

          3.4 Annual Principal Payments. Section 2.1(c) is hereby deleted in its entirety and the following inserted in its stead:

     “(i) Annual Principal Payments. The Borrower shall make principal payments such that a total aggregate principal amount equal to Six Hundred Seventy Two Thousand Dollars ($672,000) shall be paid each calendar year by or on November 30 of such year.

     (ii) Additional Mandatory Principal Payments. All Loans hereunder shall be repaid by the Borrower on the Maturity Date, unless payable sooner pursuant to the provisions of this Agreement. If the Borrower chooses not to convert any Loan which is a LIBOR Loan to a Prime Loan as provided in Section 2.2(b) and Section 2.2(c), then such Loan shall be immediately due and payable on the last Business Day of the then existing Interest Period or on such earlier date as required by law, all without further demand, presentment, protest or notice -of any kind, all of which are hereby waived by the Borrower.

     (iii) Optional Prepayments. In addition to the payments provided under Section 2.1(c) (i) and (ii) above, the Borrower may from time to time prepay the Loans which are Prime Loans, in whole or in part, without any prepayment penalty whatsoever, subject to the following conditions: (i) each partial prepayment shall be in an amount equal to $10,000.00 or a higher integral multiple -of $5,000; and (ii) any prepayment of the entire principal balance of the Prime Loans shall include accrued interest on such Prime Loans to the date of such prepayment and payment in full of all other Obligations (other than the LIBOR Loans), then due and payable.

     (iv) Adjusted-Rate Loan Prepayments. Notwithstanding anything to the contrary contained herein, the principal balance of any Adjusted-Rate Loan may not be prepaid in whole or in part at any time. If, for any reason, an Adjusted-Rate Loan is paid prior to the last Business Day of any Applicable Period, the Borrower agrees to indemnify the Bank against any loss (including any loss on redeployment of the funds repaid), cost or expense incurred by the Bank as a result of such prepayment.”

          3.5 Interest Rate Options. The first paragraph of Section 5 of the Loan Agreement is hereby deleted in its entirety and the following inserted in its stead:

“Each Loan shall be made available to the Borrower upon its request, from any Person whose authority to so act has not been revoked by the Borrower in writing previously received by the Bank. Each Loan may be advanced as a Prime Loan, a LIBOR Loan or an Adjusted-Rate Loan. A request for a Prime Loan must be received no later than 11:00 a.m. Chicago, Illinois time, on the day it is to be funded. A request for a LIBOR Loan or

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an Adjusted-Rate Loan must be received by no later than 11:00 a.m. Chicago, Illinois time, three Business Days before the day it is to be funded. Such request shall specify the requested Interest Period or Applicable Period. If for any reason the Borrower shall fail to select timely an Interest Period or Applicable Period for an existing LIBOR Loan or Adjusted-Rate Loan, then such LIBOR Loan or Adjusted-Rate Loan shall be immediately converted to a Prime Loan on the last Business Day of the then existing Interest Period or Applicable Period, all without demand, presentment, protest or notice of any kind, all of which ate hereby waived by the Borrower. The proceeds of each Prime Loan, LIBOR Loan or Adjusted-Rate Loan shall be made available at the office of the Bank by credit to the account of the Borrower or by other means requested by the Borrower and acceptable to the Bank.”

          3.6 Financial Covenants. The following new Sections 8.6 and 8.7 shall be added to the Loan Agreement:

          8.6 Financial Covenants. The Borrower shall cause Metrobank, N.A. to:

          (a) maintain such capital as is necessary to cause Metrobank, N.A. to be well capitalized in accordance with the regulations of the Federal Reserve System (“FRS”) and any requirements or conditions that the FRS has or may impose on Metrobank, N.A.;

          (b) maintain such capital as is necessary to cause Metrobank, N.A. to be classified as a “well capitalized” institution in accordance with the regulations of the Federal Deposit Insurance Corporation (“FDIC”), currently measured on the basis of information filed in the quarterly Call Reports as follows:

          (i) Total Capital to Risk-Weighted Assets of not less than 10.0%;

          (ii) Tier 1 Capital to Risk-Weighted Assets of not less than 6.0%; and

          (iii) Tier 1 Capital to average Total Assets of not less than 5.0%. For purposes of this clause, the average Total Assets shall be determined on the basis of information contained in the preceding four (4) Call Reports.

          (c) cause the ratio of nonperforming loans to the primary capital of Metrobank, N.A. to be not more than twenty percent (20.00%) at all times. For purposes of this clause, “primary capital” shall mean the sum of the common stock, surplus and retained earning accounts plus the reserve for loan and lease losses, and “nonperforming loan” shall mean the sum of all non-accrual loans and loans on which any payment is ninety (90) or more days past due;

          (d) cause the ratio of the loan and lease loss reserve to the total loans of Metrobank, N.A., adjusted to remove the 98% government guarantee on student loans, to be not less than one percent (1%) at all times; and

          (e) cause the ratio of net charge offs to average loans of Metrobank, N.A. to be less than or equal to 0.30% on an annual basis; and

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          (f) cause the ratio of Metrobank, N.A.’s net income to average total assets to be greater than or equal to 0.75% on an annual basis.

    8.7 Indebtedness . The Borrower shall not, either directly or indirectly, create, assume, incur or have outstanding any indebtedness except as described in the Exhibit “C” attached hereto and made a part hereof.

          3.7 Revolving Note. All references in the Loan Agreement to the Revolving Note in the form of Exhibit “A” to the Loan Agreement shall be deemed to be references to the Replacement Revolving Note in the form of Exhibit “A” attached hereto and made a part hereof (the “Replacement Revolving Note”).

          3.8 Indebtedness. All references to Exhibit “C” in the Loan Agreement shall be to the Exhibit “C” attached hereto and made a part hereof.

4. REPRESENTATIONS AND WARRANTIES. To induce the Bank to enter into this First Amendment, the Borrower hereby certifies, represents and warrants to the Bank that:

          4.1 Authorization. The Borrower is duly authorized to execute and deliver this First Amendment and is and will continue to be duly authorized to borrow monies under the Loan Agreement, as amended hereby, and to perform its obligations under the Loan Agreement, as amended hereby.

          4.2 No Conflicts. The execution and delivery of this First Amendment and the performance by the Borrower of its obligations under the Loan Agreement, as amended hereby, do not and will not conflict with any provision of law or of the articles of incorporation or bylaws of the Borrower or of any agreement binding upon the Borrower.

          4.3 Validity and Binding Effect. The Loan Agreement, as amended hereby, is a legal, valid and binding obligation of the Borrower, enforceable against the Borrower in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency or other similar laws of general application affecting the enforcement of creditors’ rights or by general principles of equity limiting the availability of equitable remedies.

          4.4 Compliance with Loan Agreement. The representation and warranties set forth in Section 6 of the Loan Agreement, as amended hereby, are true and correct with the same effect as if such representations and warranties had been made on the date hereof, with the exception that all references to the financial statements shall mean the financial statements most recently delivered to the Bank and except for such changes as are specifically permitted under the Loan Agreement. In addition, the Borrower has complied with and is in compliance with all of the covenants set forth in the Loan Agreement, as amended hereby, including, but not limited to, those set forth in Section 8.6 thereof.

          4.5 No Event of Default. As of the date hereof, no Event of Default under Section 9 of the Loan Agreement, as amended hereby, or event or condition which, with the giving of notice or the passage of time, or both, would constitute an Event of Default, has occurred or is continuing.

5. CONDITIONS PRECEDENT. This First Amendment shall become effective as of the date above first written after receipt by the Bank of the following documents:

          5.1 First Amendment. This First Amendment executed by the Borrower and the Bank.

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          5.2 Replacement Revolving Note. A Replacement Revolving Note dated as of November 30, 2001 in the maximum principal amount of Ten Million and 00/100 Dollars ($10,000,000.00), executed by the Borrower and made payable to the order of the Bank, in the form of Exhibit “A” attached hereto.

          5.3 Resolutions. A certified copy of resolutions of the Board of Directors and/or shareholders of the Borrower authorizing the execution, delivery and performance of this First Amendment and the related loan documents.

          5.4 Other Documents. Such other documents, certificates and/or opinions of counsel as the Bank may request.

6. GENERAL.

          6.1 Governing Law; Severability. This First Amendment shall be construed in accordance with and governed by the laws of Illinois. Wherever possible each provision of the Loan Agreement and this First Amendment shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of the Loan Agreement and this First Amendment shall be prohibited by or invalid under such law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of the Loan Agreement and this First Amendment.

          6.2 Successors and Assigns. This First Amendment shall be binding upon the Borrower and the Bank and their respective successors and assigns, and shall inure to the benefit of the Borrower and the Bank and the successors and assigns of the Bank.

          6.3 Continuing Force and Effect of Loan Documents. Except as specifically modified or amended by the terms of this First Amendment, all other terms and provisions of the Loan Agreement and the other Loan Documents are incorporated by reference herein, and in all respects, shall continue in full force and effect. The Borrower, by execution of this First Amendment, hereby reaffirms, assumes and binds itself to all of the obligations, duties, rights, covenants, terms and conditions that are contained in the Loan Agreement and the other Loan Documents.

          6.4 References to Loan Agreement. Each reference in the Loan Agreement to “this Agreement”, “hereunder”, “hereof’, or words of like import, and each reference to the Loan Agreement in any and all instruments or documents delivered in connection therewith, shall be deemed to refer to the Loan Agreement, as amended hereby.

          6.5 Expenses. The Borrower shall pay all costs and expenses in connection with the preparation of this First Amendment and other related loan documents, including, without limitation, reasonable attorneys’ fees and time charges of attorneys who may be employees of the Bank or any affiliate or parent of the Bank. The Borrower shall pay any and all stamp and other taxes, UCC search fees, filing fees and other costs and expenses in connection with the execution and delivery of this First Amendment and the other instruments and documents to be delivered hereunder, and agrees to save the Bank harmless from and against any and all liabilities with respect to or resulting from any delay-in paying or omission to pay such costs and expenses.

          6.6 Counterparts. This First Amendment may be executed in any number of counterparts, all of which shall constitute one and the same agreement.

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     IN WITNESS WHEREOF, the parties hereto have executed this First Amendment to Loan Agreement as of the date first above written.

	METROCORP, INC. a Delaware corporation
ATTEST:
/s/ John R. McEvoy, Jr.	/s/ Gary D. Andersen, President
Vice President/Cashier
	LASALLE BANK NATIONAL ASSOCIATION, a national banking association
	/s/ Delmar Rogers, Jr., First VP

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SECOND AMENDMENT TO LOAN AGREEMENT

     This SECOND AMENDMENT TO LOAN AGREEMENT dated as of August 5, 2002 (the “Second Amendment”), is entered into by and between METROCORP, INC., a Delaware corporation (the “Borrower”), whose address is 1523 8th Street, East Moline, Illinois 61244 and LASALLE BANK NATIONAL ASSOCIATION, a national banking association (the “Bank”), whose address is 135 South LaSalle Street, Chicago, Illinois 60603.

RECITALS:

     A. The Borrower and the Bank entered into that certain Loan Agreement dated as of November 1, 2001 as amended by a First Amendment dated as of November 30, 2001 (the “Loan Agreement”), pursuant to which Loan Agreement the Bank has made a Revolving Loan to the Borrower evidenced by that certain Replacement Revolving Note dated as of November 30, 2001 in the maximum principal amount of Ten Million and 00/100 Dollars ($10,000,000.00), executed by the Borrower and made payable to the order of the Bank (the “Revolving Note”).

     B. At the present time the Borrower requests, and the Bank is agreeable to a reduction of the loan commitment and the deletion of the fixed-rate option pursuant to and conditioned on the terms and conditions hereinafter set forth.

     NOW THEREFORE, in consideration of the premises and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Borrower and the Bank hereby agree as follows:

AGREEMENTS:

     1. RECITALS. The foregoing Recitals are hereby made a part of this Second Amendment.

     2. DEFINITIONS. Capitalized words and phrases used herein without definition shall have the respective meanings ascribed to such words and phrases in the Loan Agreement.

     3. AMENDMENTS TO THE LOAN AGREEMENT.

          3.1 Loan Commitment. The definition of “Loan Commitment” is hereby deleted in its entirety and the following inserted in its stead;

“‘Loan Commitment’ shall mean Eight Million and 00/100 Dollars ($8,000,000).”

          3.2 Fixed Rate Definitions. The definitions of “Adjusted Rate” and “Adjusted-Rate Loan or Adjusted-Rate Loans” shall be deleted from Section 1.1 of the Loan Agreement.

          3.3 Loan Definition. The definition of “Loans” in Section 1.1 of the Loan Agreement is hereby deleted in its entirety and the following inserted in its stead:

“‘Loans’ shall mean, collectively, all Loans (whether Prime Loans or LIBOR Loans) made by the Bank to the Borrower, under and pursuant to this Agreement.”

          3.4 Adjusted-Rate Loan Prepayments. Section 2.1(c)(iv) is hereby deleted in its entirety.

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          3.5 Interest Rate Options. The first paragraph of Section 5 of the Loan Agreement is hereby deleted in its entirety and the following inserted in its stead:

“Each Loan shall be made available to the Borrower upon its request, from any Person whose authority to so act has not been revoked by the Borrower in writing previously received by the Bank. Each Loan may be advanced as a Prime Loan or a LIBOR Loan. A request for a Prime Loan must be received no later than 11:00 a.m. Chicago, Illinois time, on the day it is to be funded. A request. for a LIBOR Loan must be received by no later than 11:00 a.m. Chicago, Illinois time, three Business Days before the day it is to be funded. Such request shall specify the requested Interest Period. If for any reason the Borrower shall fail to select timely an Interest Period for an existing LIBOR Loan, then such LIBOR Loan shall be immediately converted to a Prime Loan on the last Business Day of the then existing Interest Period, all without demand, presentment, protest or notice of any kind, all of which are hereby waived by the Borrower. The proceeds of each Prime Loan or LIBOR Loan shall be made available at the office of the Bank by credit to the account of the Borrower or by other means requested by the Borrower and acceptable to the Bank.”

          3.6 Revolving Note. All references in the Loan Agreement to the Revolving Note in the form of Exhibit “A” to the Loan Agreement shall be deemed to be references to the Replacement Revolving Note in the form of Exhibit “A” attached hereto and made a part hereof.

     4. REPRESENTATIONS AND WARRANTIES. To induce the Bank to enter into this Second Amendment, the Borrower hereby certifies, represents and warrants to the Bank that:

          4.1 Authorization. The Borrower is duly authorized to execute and deliver this Second Amendment and is and will continue to be duly authorized to borrow monies under the Loan Agreement, as amended hereby, and to perform its obligations under the Loan Agreement, as amended hereby.

          4.2 No Conflicts. The execution and delivery of this Second Amendment and the performance by the Borrower of its obligations under the Loan Agreement, as amended hereby, do not and will not conflict with any provision of law or of the articles of incorporation or bylaws of the Borrower or of any agreement binding upon the Borrower.

          4.3 Validity and Binding Effect. The Loan Agreement, as amended hereby, is a legal, valid and binding obligation of the Borrower, enforceable against the Borrower in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency or other similar laws of general application affecting the enforcement of creditors’ rights or by general principles of equity limiting the availability of equitable remedies.

          4.4 Compliance with Loan Agreement. The representation and warranties set forth in Section 6 of the Loan Agreement, as amended hereby, are true and correct with the same effect as if such representations and warranties had been made on the date hereof, with the exception that all references to the financial statements shall mean the financial statements most recently delivered to the Bank and except for such changes as are specifically permitted under the Loan Agreement. In addition, the Borrower has complied with and is in compliance with all of the covenants set forth in the Loan Agreement, as amended hereby, including, but not limited to, those set forth in Section 8.6 thereof.

          4.5 No Event of Default. As of the date hereof, no Event of Default under Section 9 of the Loan Agreement, as amended hereby, or event or condition which, with the giving of notice or the passage of time, or both, would constitute an Event of Default, has occurred or is continuing.

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     5. CONDITIONS PRECEDENT. This Second Amendment shall become effective as of the date above first written after receipt by the Bank of the following documents:

          5.1 Second Amendment. This Second Amendment executed by the Borrower and the Bank.

          5.2 Replacement Revolving Note. A Replacement Revolving Note dated as of August 5, 2002 in the maximum principal amount of Eight Million and 00/100 Dollars ($8,000,000.00), executed by the Borrower and made payable to the order of the Bank, in the form of Exhibit “A” attached hereto.

          5.3 Resolutions. A certified copy of resolutions of the Board of Directors and/or shareholders of the Borrower authorizing the execution, delivery and performance of this Second Amendment and the related loan documents.

          5.4 Other Documents. Such other documents, certificates and/or opinions of counsel as the Bank may request.

     6. GENERAL.

          6.1 Governing Law; Severability. This Second Amendment shall be construed in accordance with and governed by the laws of Illinois. Wherever possible each provision of the Loan Agreement and this Second Amendment shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of the Loan Agreement and this Second Amendment shall be prohibited by or invalid under such law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of the Loan Agreement and this Second Amendment.

          6.2 Successors and Assigns. This Second Amendment shall be binding upon the Borrower and the Bank and their respective successors and assigns, and shall inure to the benefit of the Borrower and the Bank and the successors and assigns of the Bank.

          6.3 Continuing Force and Effect of Loan Documents. Except as specifically modified or amended by the terms of this Second Amendment, all other terms and provisions of the Loan Agreement and the other Loan Documents are incorporated by reference herein, and in all respects, shall continue in full force and effect. The Borrower, by execution of this Second Amendment, hereby reaffirms, assumes and binds itself to all of the obligations, duties, rights, covenants, terms and conditions that are contained in the Loan Agreement and the other Loan Documents.

          6.4 References to Loan Agreement. Each reference in the Loan Agreement to “this Agreement”, “hereunder”, “hereof’, or words of like import, and each reference to the Loan Agreement in any and all instruments or documents delivered in connection therewith, shall be deemed to refer to the Loan Agreement, as amended hereby.

          6.5 Expenses. The Borrower shall pay all costs and expenses in connection with the preparation of this Second Amendment and other related loan documents, including, without limitation, reasonable attorneys’ fees and time charges of attorneys who may be employees of the Bank or any affiliate or parent of the Bank. The Borrower shall pay any and all stamp and other taxes, UCC search fees, filing fees and other costs and expenses in connection with the execution and delivery of this Second Amendment and the other instruments and documents to be delivered hereunder, and agrees to save the Bank harmless from and against any and all liabilities with respect to or resulting from any delay in paying or omission to pay such costs and expenses.

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          6.6 Counterparts. This Second Amendment may be executed in any number of counterparts, all of which shall constitute one and the same agreement.

     IN WITNESS WHEREOF, the parties hereto have executed this Second Amendment to Loan Agreement as of the date first above written.

ATTEST:	METROCORP, INC. a Delaware corporation
/s/ John R. McEvoy, Jr.	/s/ Gary D. Andersen, President
Vice President/Cashier
	LASALLE BANK NATIONAL ASSOCIATION, a national banking association
	/s/ Delmar Rogers, Jr., First VP

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EX-14.1

EXHIBIT 14.1

METROCORP, INC.

CODE OF ETHICS FOR PRINCIPAL EXECUTIVE OFFICERS
AND SENIOR FINANCIAL OFFICERS
(as of February 20, 2006)

     Metrocorp, Inc. (the “Company”) has adopted this Code of Ethics for Principal Executive Officers and Senior Financial Officers (this “Code”) to ensure the integrity of the Company’s and Metrobank, NA’s (the “Bank”) financial reporting and transactions. This Code applies to the Chief Executive Officer(s) of the Company and Bank, the Chief Financial Officer(s) of the Company and the Bank and the Chief Operating Officer of the Bank (“Senior Financial Officers”).

     The Company’s Code of Business Conduct sets forth the Company’s fundamental policies, principles and procedures. You are bound by the standards and requirements set forth in the Code of Business Conduct as well as the standards and requirements set forth in this Code. Violations of this Code will result in immediate disciplinary action up to and including immediate discharge from employment.

Business Ethics and Conflicts of Interest

     As a Senior Financial Officer, your leadership responsibilities include creating a business culture of high ethical standards and an unwavering commitment to compliance with all laws, rules and regulations. You must act with honesty and integrity, avoiding actual or apparent conflicts of interest between personal and professional relationships. You are prohibited from exploiting your position or relationship with the Company for personal gain. Although it is impossible to list every conceivable conflict of interest, the following are some illustrative examples of conflicts or interest:

• You or a member of your family has more than a modest ownership or financial interest in the Company’s competitors, clients or vendors;

• You or a member of your family use nonpublic Company, client or vendor information for personal gain;

• You cause the Company to engage in business transactions with family or friends, other than banking transactions in the regular course of business; or

• You compete, or prepare to compete, with the Company while still employed by the Company.

Accurate Periodic Reports

     Senior Financial Officers are responsible for assuring full, fair, accurate, timely and understandable disclosure of relevant financial information to shareholders and investors. In particular they are responsible for assuring that the Company complies with Securities and Exchange Commission rules governing disclosure of financial information and for assuring that

press releases and communications with investors and securities analysts are fair and accurate. As a Senior Financial Officer, you should:

• establish and maintain internal controls and procedures and disclosure controls and procedures designed to assure that financial information is recorded, processed and transmitted to those responsible for preparing periodic reports and other public communications containing financial information so that they are complete, accurate, and timely;

• carefully review each periodic report for accuracy and completeness before it is filed with the Securities and Exchange Commission and carefully review each public communication containing financial information before it is released;

• maintain books, accounts and records according to generally accepted accounting principles, using enough detail to accurately and fairly reflect Company transactions; and

• promptly disclose to your superiors, and if necessary to the Audit Committee, any material weaknesses in, or concerns regarding, the Company’s disclosure controls or internal controls.

Compliance with Applicable Laws

     You are expected to comply with all applicable laws, rules and regulations of federal, state and local governments, and other appropriate private and public regulatory agencies.

Reporting Misconduct

     If you become aware or suspect that the Company or any Senior Financial Officer is violating any law or this Code, you have a duty to report such violation to the Company’s legal advisors. All reports will be dealt with confidentially. Neither the Company nor any of its employees shall take retaliatory action against any person for making a good faith report. In addition, you shall comply with the Company’s procedure for employee concerns and complaints regarding accounting or auditing matters adopted in February 2003.

Waivers of this Code

     The Board of Directors of the Company must approve any waiver of the provisions and policies of this Code for a Senior Financial Officer (or for any other employee, officer or director of the Company). Any such waiver must be promptly disclosed to the Company’s shareholders, along with the reasons for such waiver, in accordance with applicable law.

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EX-14.2

EXHIBIT 14.2

METROCORP, INC.

CODE OF BUSINESS CONDUCT
(as of February 20, 2006)

     Metrocorp, Inc. and its subsidiaries (together the “Company”) expect all of its personnel to perform his or her duties ethically and honestly and with the highest sense of integrity. An uncompromising adherence to ethical excellence is integral to creating and maintaining trust and credibility with our customers, employees and shareholders.

     This Code of Business Conduct (this “Code”) outlines certain principles of ethical business conduct embraced by the Company. It is not a complete list of ethical issues an employee, officer or director may face in the course of business, and supplements the other codes and policies adopted by the Company. You should consult your supervisor or the Human Resource Department if you have any questions regarding the standards and policies set forth in this Code or regarding a legal or ethical issue not explicitly covered in this Code.

     This Code applies to all employees, officers and directors of the Company. We expect the standards and policies set forth in this Code to be strictly observed. Those who violate such standards and policies will be subject to severe disciplinary action, up to and including termination. Therefore, you are urged to read and understand this Code and to inform your supervisor or the Human Resource Department well in advance of any situation that you believe may violate or lead to a violation of this Code.

Business Ethics

     As an employee, officer or director of the Company, part of your responsibilities is to maintain our high standards of business conduct and to safeguard our reputation. Our goal is to promote an atmosphere where ethical behavior is recognized as a priority and practiced. You must act with honesty and integrity and are prohibited from exploiting your position or relationship with the Company for personal gain.

Conflicts of Interest

     Employees, officers and directors must refrain from engaging in any activity or practice in conflict with the interest of a customer or of the Company. Even the appearance of such a conflict must be avoided.

     Increasing attention is being paid to ethics in the business community due to the unique position of trust and confidence that banking allows. The Company has a duty to comply with requirements of the law, to act in fairness and in good faith in dealing with customers, and to observe high standards of personal conduct. The following are some examples of conflicts which should be avoided:

• No employee, officer or director, should accept a personal fiduciary appointment as executor, trustee, guardian, or committee which develops primarily in the course of Company business unless prior approval of the Human Resources Department has been obtained.

• If an employee, officer or director or a member of their family has a direct or indirect interest in a firm which is dealing with the Company and the interest is sufficient to affect the employee’s decisions or actions, the employee, officer or director must not act for the Company in such transactions.

• The assets of the Company must not be used to maintain a correspondent account with another bank in return for a personal loan or preferential terms from such other banks to an officer of our Company.

• Employees, officers and directors must not use inside information concerning the Company or its customers for their own benefit.

• Employees, officers and directors should not engage in pricing arrangements with other financial institutions.

     The Company recognizes that some decisions involving business ethics are not always easy to make and that there may be different interpretations of a given situation. When questions concerning conflicts of interest arise, it is expected that every member of the staff will consult with their immediate supervisor.

Accurate Records and Reports

     The integrity of the Company’s record keeping and reporting systems is of the utmost importance. Employees must use special care to make sure that (i) records are accurately and completely prepared and reviewed, regardless of whether they are intended for internal use or for an external party (including governmental agencies), and (ii) disclosure of relevant financial information to the Company’s shareholders and investors is full, fair, accurate, timely and understandable. The following are some general guidelines with respect to record keeping and reporting:

• No false or misleading entries or omissions shall be permitted for any reason whatsoever. This critical responsibility applies to employees who review and approve reports as well as those who initially prepare them.

• The documentation evidencing each transaction and each payment on behalf of the Company shall fairly represent the nature of such transaction or the purpose of such payment.

• Employees must apply accepted accounting rules and practices, as described in the Company’s policies or procedures.

• Employees must follow Company procedures for retaining and disposing of records.

Compliance with Applicable Laws

     The Company expects that all employees, officers and directors to comply with all laws, including all applicable statutes, rules and regulations, while performing his or her duties on behalf of the Company.

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Reporting Misconduct

     If you become aware or suspect that the Company or any employee, officer or director of the Company is violating any law or this Code, you have a duty to report such violation. Such violations may be reported to your supervisor, or, if you are uncomfortable making the report to your supervisor, reports may be made directly to the Human Resource Department. All reports will be dealt with confidentially. Neither the Company nor any of its employees shall take retaliatory action against an employee for making a good faith report. In addition, all employees, officers and directors of the Company shall comply with the Company’s procedure for employee concerns and complaints regarding accounting or auditing matters adopted in February 2003.

Waivers of this Code

     The Board of Directors of the Company must approve any waiver of the provisions and policies of this Code for executive officers and directors. Any such waiver must be promptly disclosed to the Company’s shareholders, along with the reasons for such waiver, in accordance with applicable law.

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EX-31.1

Exhibit 31.1

Certification Pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as Amended

I, Gary D. Andersen, certify that:

1.	I have reviewed this annual report on Form 10-K of Metrocorp, Inc.;
2.	Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;
3.	Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;
4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and we have:

a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;
b.	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
c.	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

Date: February 27, 2006	/s/ Gary D. Andersen
	Gary D. Andersen
	President and Chief Executive Officer

EX-31.2

Exhibit 31.2

Certification Pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as Amended

I, John R. McEvoy, Jr., certify that:

1.	I have reviewed this annual report on Form 10-K of Metrocorp, Inc.;
2.	Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;
3.	Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;
4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and we have:

a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;
b.	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
c.	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

Date: February 27, 2006	/s/ John R. McEvoy, Jr.
	Controller and Chief Financial Officer

EX-32.1

Exhibit 32.1

Certification Pursuant to 18 U.S.C. Section 1350.

In connection with the Annual Report of Metrocorp, Inc. (the “Company”) on Form 10-K for the period ending October 31, 2005 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Gary D. Andersen,. Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)	The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Gary D. Andersen

Gary D. Andersen

Chief Executive Officer

A signed original of this written statement required by Section 906 has been provided to Metrocorp, Inc. and will be retained by Metrocorp, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

Exhibit 32.2

Certification Pursuant to 18 U.S.C. Section 1350.

In connection with the Annual Report of Metrocorp, Inc. (the “Company”) on Form 10-K for the period ending October 31, 2005 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, John R. McEvoy, Jr., Controller and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)	The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ John R. McEvoy, Jr.

John R. McEvoy, Jr.

Controller and Chief Financial Officer

A signed original of this written statement required by Section 906 has been provided to Metrocorp, Inc. and will be retained by Metrocorp, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

EX-99.1

EXHIBIT 99.1

METROCORP, INC.
AUDIT COMMITTEE CHARTER
(as of February 20, 2006)

     The Audit Committee is a committee of the Board of Directors of Metrocorp, Inc. (the “Company”). Its primary function is to assist the Board in fulfilling its oversight responsibilities by reviewing:

• the integrity of the Company’s financial information which will be provided to the shareholders and others, including the financial reporting process and the systems of internal controls regarding finance, accounting and legal and regulatory compliance;

• the independence, qualifications and performance of the Company’s financial executives, independent auditor and internal auditing department; and

• the communication among the independent auditor, management, the internal auditing function and the Board of Directors.

     The Audit Committee shall discharge its responsibilities, and shall assess the information provided by the Company’s management and the external auditor, in accordance with its business judgment. Management is responsible for the preparation, presentation and integrity of the Company’s financial statements and for the appropriateness of the accounting principles and reporting policies that are used by the Company. The external auditor is responsible for auditing the Company’s financial statements and for reviewing the Company’s unaudited interim financial statements. The authority and responsibilities set forth in this Charter do not reflect or create any duty or obligation of the Audit Committee to plan or conduct any audit, to determine or certify that the Company’s financial statements are complete, accurate, fairly presented or in accordance with generally accepted accounting principles or applicable law, or to guarantee the external auditor’s report.

     In meeting its responsibilities, the Audit Committee is expected to:

1.	Provide an open avenue of communication between the internal auditor, the external auditor, management and the Board of Directors.
2.	Review and update the committee’s charter annually. The charter will be published at least every three years in accordance with SEC regulations.
3.	Be directly responsible for appointing, evaluating and, when necessary, terminating the external auditor, and approving the compensation of the external auditor.
4.	Review and concur in the appointment, replacement, reassignment or dismissal of the internal audit staff.
5.	Review and assess annually the independence of the internal auditor and the external auditor, including a review of management consulting services and

	related fees provided by the external auditor. The Audit Committee shall obtain and review a report by the external auditor describing all relationships between the external auditor and the Company, including the disclosures required by Independence Standards Board Standard No. 1. The Audit Committee shall engage in an active dialogue with the external auditor concerning any disclosed relationships or services that might impact the objectivity and independence of the auditor.
6.	Inquire of management, the internal auditor and the external auditor about significant risks or exposures and assess the steps management has taken to minimize such risk to the Company.
7.	Consider, in consultation with the external auditor and the internal auditor, the audit plan of the internal auditors and the external auditors.
8.	Consider and review annually with the external auditor and the internal auditor:

(a)	The adequacy of the Company’s internal controls; and
(b)	Any related significant findings and recommendations of the external auditor and internal auditor together with management’s responses thereto.

9. Review with management and the external auditor:

(a)	The Company’s annual and quarterly financial statements, related footnotes and other schedules (before they are filed with any banking regulators or the SEC), including the Company’s disclosures under “Management’s Discussion and Analysis of Financial Condition and Results of Operation”;
(b)	The external auditor’s audit of the financial statements and the resulting report;
(c)	Any changes required in the external auditor’s audit plan;
(d)	Any significant difficulties or disputes with management encountered during the course of the audit and their resolution, including any restrictions on the scope of the external auditor’s activities or on access to requested information; and
(e)	Other matters related to the conduct of the audit, which are to be communicated to the committee under generally accepted auditing standards.

10. Oversee the accounting and financial reporting processes of the Company and the audits of the financial statements of the Company.

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11.	Consider annually whether it will recommend to the Board of Directors that the Company’s audited financial statements be included in the Company’s Annual Report on Form 10-K.
12.	Direct the external auditor to use its best efforts to perform all reviews of interim financial information prior to disclosure by the Company of such information and to discuss promptly with the Audit Committee and the Chief Financial Officer any matters identified in connection with the auditor review of interim financial information which are required to be discussed by Statement on Auditing Standards Nos. 61, 71 and 90. The Audit Committee shall direct management to advise the Audit Committee in the event that the Company proposed to disclose interim financial information prior to completion of the external auditor’s review of interim financial information.
13.	Annually obtain and review a report by the external auditor describing:

(a)	the firm’s internal quality control procedures; and
(b)	any material issues raised by the most recent internal quality control review, or peer review, of the firm, or by an inquiry or investigation by governmental or professional authorities, within the preceding five years, respecting one or more independent audits carried out by the firm, and any steps taken to deal with any such issues.

14.	Preapprove all auditing services, which may include providing comfort letters in connection with securities underwritings, and non-audit services (other than de minimus non-audit services as defined by the Sarbanes-Oxley Act of 2002) to be provided to the Company by the external auditor. The Audit Committee shall cause the Company to disclose in its SEC periodic reports the approval by the Audit Committee of any non-audit services to be performed by the external auditor.
15.	Coordinate the Board of Director’s oversight of the Company’s internal accounting controls and the Company’s disclosure controls and procedures. The Audit Committee shall receive and review the reports of the CEO and CFO required by Section 302 of the Sarbanes-Oxley Act of 2002 and Rule 13a-14 of the Securities Exchange Act of 1934, as amended (i.e., the Certification of Disclosure in Annual and Quarterly Results).
16.	Consider and review with the internal auditor and management, as deemed appropriate:

(a)	Any changes required in the planned scope of their audit plan;
(b)	The Internal Audit Department staffing; and
(c)	The Internal Audit Department Policy.

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17.	At least semi-annually, meet privately in executive session with the internal auditor, the external auditor and the Company’s CEO to discuss any matters that the committee or these groups believe should be discussed privately with the Audit Committee.
18.	Report committee actions to the Board of Directors with such recommendations as the committee may deem appropriate. In addition, the Audit Committee or its Chair shall communicate with management and the external auditor quarterly to review the Company’s financial statements and significant findings based upon the external auditor’s limited review procedures. The Audit Committee shall keep records of its meetings as it deems appropriate.
19.	Maintain procedures for the “confidential anonymous submission by employees” of concerns regarding questionable accounting or auditing matters, and the receipt, retention and treatment of complaints received by the Company regarding accounting, internal accounting controls or auditing matters.
20.	Have the power to conduct or authorize investigations into any matters within the committee’s scope of responsibilities. The committee shall be empowered to retain independent counsel, accountants or others to assist it in the conduct of any investigation.
21.	Meet at least four times per year or more frequently as circumstances require. The committee may ask members of management or others to attend the meeting and provide pertinent information as necessary.
22.	Have such other duties as may be delegated from time to time by the Board of Directors.
23.	Annually evaluate its own performance.

     The membership of the Audit Committee shall consist of at least three independent members of the Board of Directors who shall serve at the pleasure of the Board of Directors. Except as otherwise permitted by Section 301 of the Sarbanes-Oxley Act of 2002, each member of the Audit Committee shall be “independent” as defined by such rules and Act. In addition, no member of the Audit Committee shall have participated in the preparation of the financial statements of the Company or any current subsidiary of the Company at any time during the past three years.

     Each member of the Audit Committee shall be able to read and understand fundamental financial statements, including the Company’s balance sheet, income statement, and cash flow statement and shall otherwise be financially literate, as such qualification is interpreted by the Company’s Board of Directors in its business judgment. At least one member of the Audit Committee must have past employment experience in finance or accounting, requisite professional certification in accounting, or any other comparable experience or background which results in the individual’s financial sophistication, including being or having been a chief executive officer, chief financial officer or other senior officer with financial oversight responsibilities. Unless otherwise determined by the Board of Directors (in which case

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disclosure of such determination shall be made in the Company’s SEC periodic reports), at least one member of the Audit Committee shall be an “audit committee financial expert” as defined by the Act and applicable SEC rules.

     Audit Committee members may not accept any consulting, advisory or other compensatory fees from the Company or its subsidiaries, other than in his or her capacity as a member of the Audit Committee, Board of Directors or other Board committee. Audit Committee members and the committee chairman shall be appointed by the full Board of Directors. The Board of Directors may remove members from the Audit Committee at any time with or without cause.

     The external auditor shall report directly to the Audit Committee and the Audit Committee shall be directly responsible for oversight of the work of the external auditor, including resolution of disagreements between Company management and the external auditor regarding financial reports. The Audit Committee shall as necessary obtain and review the reports required to be made by the external auditor pursuant to paragraph (k) of Section 10A of the Securities Exchange Act of 1934, as amended, regarding:

• critical accounting policies and practices;

• alternative treatments of financial information within generally accepted accounting principles that have been discussed with Company management, ramifications of the use of such alternative disclosures and treatments, and the treatment preferred by the external auditor; and

• other material written communications between the external auditor and Company management, such as any management letter or schedule of unadjusted differences.

     The Audit Committee shall review and preapprove all transactions between the Company or its subsidiaries and any officer or director, or affiliate thereof, of the Company or its subsidiaries, or any other transaction required to be disclosed pursuant to Item 404 of SEC Regulation S-K.

     The Audit Committee shall have the authority to engage independent legal, accounting and other advisors as it deems necessary to carry out its responsibilities. These independent advisors may be the regular advisors to the Company. The Audit Committee is empowered, without further action by the Board of Directors, to cause the Company to pay the compensation of such advisors as established by the Audit Committee.

     The duties and responsibilities of a member of the Audit Committee are in addition to those duties set out for a member of the Board of Directors.

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