<SUBMISSION>
<ACCESSION-NUMBER>0001193125-09-219045
<TYPE>8-K
<PUBLIC-DOCUMENT-COUNT>3
<PERIOD>20091029
<ITEMS>1.01
<ITEMS>8.01
<ITEMS>9.01
<FILING-DATE>20091030
<DATE-OF-FILING-DATE-CHANGE>20091030
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>Southern National Bancorp of Virginia Inc
<CIK>0001325670
<ASSIGNED-SIC>6022
<IRS-NUMBER>201417448
<STATE-OF-INCORPORATION>VA
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>8-K
<ACT>34
<FILE-NUMBER>001-33037
<FILM-NUMBER>091148833
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>1770 TIMBERWOOD BOULEVARD
<STREET2>SUITE 100
<CITY>CHARLOTTESVILLE
<STATE>VA
<ZIP>22911
<PHONE>(434) 973-5242
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>1770 TIMBERWOOD BOULEVARD
<STREET2>SUITE 100
<CITY>CHARLOTTESVILLE
<STATE>VA
<ZIP>22911
</MAIL-ADDRESS>
</FILER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>d8k.htm
<DESCRIPTION>FORM 8-K
<TEXT>
<HTML><HEAD>
<TITLE>FORM 8-K</TITLE>
</HEAD>
 <BODY BGCOLOR="WHITE">
 <P STYLE="line-height:0px;margin-top:0px;margin-bottom:0px;border-bottom:0.5pt solid #000000">&nbsp;</P> <P
STYLE="line-height:3px;margin-top:0px;margin-bottom:2px;border-bottom:0.5pt solid #000000">&nbsp;</P> <P STYLE="margin-top:4px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="5"><B>UNITED STATES </B></FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="5"><B>SECURITIES AND EXCHANGE COMMISSION </B></FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT
STYLE="font-family:Times New Roman" SIZE="3"><B>WASHINGTON, D.C. 20549 </B></FONT></P> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P><center> <P
STYLE="line-height:6px;margin-top:0px;margin-bottom:2px;border-bottom:1pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="margin-top:6px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="5"><B>FORM 8-K </B>
</FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="4"><B>CURRENT REPORT </B></FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px" ALIGN="center"><FONT
STYLE="font-family:Times New Roman" SIZE="3"><B>Pursuant to Section&nbsp;13 OR 15(d) of </B></FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="3"><B>The Securities Exchange Act of
1934 </B></FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="3"><B>Date of Report (Date of earliest event reported):&nbsp;October 29, 2009 </B></FONT></P> <P
STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P><center> <P STYLE="line-height:6px;margin-top:0px;margin-bottom:2px;border-bottom:1pt solid #000000;width:21%">&nbsp;</P></center> <P STYLE="margin-top:6px;margin-bottom:0px"
ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="6"><B>Southern National Bancorp of Virginia, Inc. </B></FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>(Exact
name of registrant as specified in its charter) </B></FONT></P> <P STYLE="font-size:12px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="32%"></TD></TR>
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<TD VALIGN="top" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Virginia</B></FONT></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="top" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>001-33037</B></FONT></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="top" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>20-1417448</B></FONT></TD></TR>
<TR>
<TD VALIGN="top" ALIGN="center"> <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="1"><B>(State or other jurisdiction</B></FONT></P> <P STYLE="margin-top:0px;margin-bottom:1px"
ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="1"><B>of incorporation)</B></FONT></P></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="top" ALIGN="center"> <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="1"><B>(Commission</B></FONT></P> <P STYLE="margin-top:0px;margin-bottom:1px" ALIGN="center"><FONT
STYLE="font-family:Times New Roman" SIZE="1"><B>File Number)</B></FONT></P></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="top" ALIGN="center"> <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="1"><B>(IRS Employer</B></FONT></P> <P STYLE="margin-top:0px;margin-bottom:1px" ALIGN="center"><FONT
STYLE="font-family:Times New Roman" SIZE="1"><B>Identification No.)</B></FONT></P></TD></TR>
</TABLE> <P STYLE="margin-top:12px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>6830 Old Dominion Drive </B></FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"
ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>McLean, Virginia 22101 </B></FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="1"><B>(Address of principal
executive offices including zip code) </B></FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Registrant&#146;s telephone number, including area code: (434)&nbsp;973-5242 </B>
</FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Check the appropriate box below if the Form&nbsp;8-K filing is intended to simultaneously satisfy the filing obligation of
the registrant under any of the following provisions (see General Instruction A.2. below): </FONT></P> <P STYLE="font-size:12px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><FONT STYLE="FONT-FAMILY:WINGDINGS">&#168;</FONT></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Written communications pursuant to Rule&nbsp;425 under the Securities Act (17 CFR 230.425) </FONT></TD></TR></TABLE> <P
STYLE="font-size:12px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><FONT STYLE="FONT-FAMILY:WINGDINGS">&#168;</FONT></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Soliciting material pursuant to Rule&nbsp;14a-12 under the Exchange Act (17&nbsp;CFR 240.14a-12) </FONT></TD></TR></TABLE> <P
STYLE="font-size:12px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><FONT STYLE="FONT-FAMILY:WINGDINGS">&#168;</FONT></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Pre-commencement communications pursuant to Rule&nbsp;14d-2(b) under the Exchange Act (17&nbsp;CFR 240.14d-2(b)) </FONT></TD></TR></TABLE> <P
STYLE="font-size:12px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><FONT STYLE="FONT-FAMILY:WINGDINGS">&#168;</FONT></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Pre-commencement communications pursuant to Rule&nbsp;13e-4(c) under the Exchange Act (17&nbsp;CFR 240.13e-4(c)) </FONT></TD></TR></TABLE> <P
STYLE="font-size:8px;margin-top:0px;margin-bottom:0px">&nbsp;</P> <P STYLE="line-height:0px;margin-top:0px;margin-bottom:0px;border-bottom:0.5pt solid #000000">&nbsp;</P> <P
STYLE="line-height:3px;margin-top:0px;margin-bottom:2px;border-bottom:0.5pt solid #000000">&nbsp;</P>

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<TR>
<TD WIDTH="9%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Item&nbsp;1.01.</B></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Entry into a Material Definitive Agreement. </B></FONT></TD></TR></TABLE> <P STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">On October&nbsp;29, 2009, Southern National Bancorp of Virginia, Inc. (the &#147;Company&#148;) entered into an underwriting agreement (the &#147;Underwriting Agreement&#148;) with FIG Partners, LLC (the
&#147;Underwriter&#148;), relating to the sale of 4,166,666 shares of the Company&#146;s common stock, par value $0.01 per share (the &#147;Common Stock&#148;), plus up to an additional 624,999 shares of Common Stock if the Underwriter exercises its
30-day option to purchase additional shares to cover over-allotments, if any, at a public offering price of $6.00 per share. The transactions contemplated by the Underwriting Agreement are expected to close on November&nbsp;4, 2009. The net proceeds
to the Company from this offering, after deducting underwriting discounts and commissions but before estimated offering expenses, are expected to be approximately $23.8 million (or approximately $27.4 million if the Underwriter exercises its
over-allotment option in full). </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">The Underwriting Agreement contains customary representations, warranties, and conditions to
closing. The Company has also agreed to indemnify the Underwriter against certain liabilities, including civil liabilities under the Securities Act of 1933, as amended, or to contribute to payments that the Underwriter may be required to make in
respect of those liabilities. Subject to specified exceptions, the Company and each of its directors and executive officers also agreed not to make an offer, sale, short sale, or other similar disposition of shares of Common Stock or other
securities convertible into or exchangeable or exercisable for shares of Common Stock for 90 days after October&nbsp;29, 2009 without first obtaining the written consent of the Underwriter. </FONT></P> <P
STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">The foregoing description of the Underwriting Agreement does not purport to be complete and is qualified in its entirety by reference to the
full text of the Underwriting Agreement, a copy of which is attached hereto as Exhibit&nbsp;1.1 and is incorporated by reference into this Item&nbsp;1.01. </FONT></P> <P STYLE="font-size:18px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="9%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Item&nbsp;8.01</B></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Other Events. </B></FONT></TD></TR></TABLE> <P STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">On
October&nbsp;29, 2009, the Company&#146;s registration statement relating to the underwritten public offering of its Common Stock became effective. The preliminary prospectus included as part of the registration statement disclosed the risk factors
relating to the Company&#146;s business and Common Stock that are included in Exhibit&nbsp;99.1 and incorporated into this Item&nbsp;8.01 by reference. Such risk factors update and supersede the risk factors discussed in Part&nbsp;I under the
caption &#147;Item&nbsp;1A. Risk Factors&#148; in the Company&#146;s Annual Report on Form&nbsp;10-K for the year ended December&nbsp;31, 2008 and in Part II under the caption &#147;Item 1A &#150; Risk Factors&#148; in the Company&#146;s Quarterly
Reports on Form 10-Q for the periods ended March&nbsp;31, 2009 and June&nbsp;30, 2009. </FONT></P> <P STYLE="font-size:18px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR>
<TD WIDTH="9%" VALIGN="top" ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Item&nbsp;9.01</B></FONT></TD>
<TD ALIGN="left" VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Financial Statements and Exhibits. </B></FONT></TD></TR></TABLE> <P STYLE="margin-top:6px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">(d)
<I>Exhibits</I>. </FONT></P> <P STYLE="font-size:12px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD VALIGN="bottom" NOWRAP ALIGN="center"> <P STYLE="border-bottom:1px solid #000000;width:28pt" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="1"><B>Exhibit<BR>Number</B></FONT></P></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom"> <P STYLE="border-bottom:1px solid #000000;width:75pt"><FONT STYLE="font-family:Times New Roman" SIZE="1"><B>Description of Exhibit</B></FONT></P></TD></TR>
<TR>
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT STYLE="font-family:Times New Roman" SIZE="2">1.1</FONT></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Underwriting Agreement dated October&nbsp;29, 2009 between Southern National Bancorp of Virginia, Inc. and FIG Partners, LLC.</FONT></TD></TR>
<TR>
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="right"><FONT STYLE="font-family:Times New Roman" SIZE="2">99.1</FONT></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Risk Factors.</FONT></TD></TR>
</TABLE> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
 <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">-2- </FONT></P>


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 <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>SIGNATURES </B></FONT></P> <P
STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized. </FONT></P> <P STYLE="font-size:12px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="top" COLSPAN="3"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Southern National Bancorp of Virginia, Inc.</B></FONT></TD></TR>
<TR>
<TD COLSPAN="3" VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="top" COLSPAN="3"> <P STYLE="text-indent:2.00em"><FONT STYLE="font-family:Times New Roman" SIZE="2">(Registrant)</FONT></P></TD></TR>
<TR>
<TD HEIGHT="16" COLSPAN="3"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR>
<TD VALIGN="top" COLSPAN="3"><FONT STYLE="font-family:Times New Roman" SIZE="2">Dated: October&nbsp;30, 2009</FONT></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">By:</FONT></TD>
<TD VALIGN="bottom" STYLE="BORDER-BOTTOM:1px solid #000000"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="top" ALIGN="center" STYLE="BORDER-BOTTOM:1px solid #000000"><FONT STYLE="font-family:Times New Roman" SIZE="2">/s/&nbsp;&nbsp;&nbsp;&nbsp;W<SMALL>ILLIAM</SMALL> H.
L<SMALL>AGOS&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</SMALL></FONT></TD></TR>
<TR>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="bottom" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="1"><B>William H. Lagos</B></FONT></TD></TR>
<TR>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="bottom" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="1"><B><I>Senior Vice President and Chief Financial Officer</I></B></FONT></TD></TR>
</TABLE>

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 <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>EXHIBIT INDEX </B></FONT></P> <P
STYLE="font-size:12px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD VALIGN="bottom" NOWRAP ALIGN="center"> <P STYLE="border-bottom:1px solid #000000;width:28pt" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="1"><B>Exhibit<BR>Number</B></FONT></P></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="bottom"> <P STYLE="border-bottom:1px solid #000000;width:75pt"><FONT STYLE="font-family:Times New Roman" SIZE="1"><B>Description of Exhibit</B></FONT></P></TD></TR>
<TR>
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">&nbsp;&nbsp;1.1</FONT></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Underwriting Agreement dated October 29, 2009 between Southern National Bancorp of Virginia, Inc. and FIG Partners,&nbsp;LLC.</FONT></TD></TR>
<TR>
<TD HEIGHT="8"></TD>
<TD HEIGHT="8" COLSPAN="2"></TD></TR>
<TR>
<TD VALIGN="top" NOWRAP ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">99.1</FONT></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;&nbsp;</FONT></TD>
<TD VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Risk Factors.</FONT></TD></TR>
</TABLE>
</BODY></HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-1.1
<SEQUENCE>2
<FILENAME>dex11.htm
<DESCRIPTION>UNDERWRITING AGREEMENT
<TEXT>
<HTML><HEAD>
<TITLE>Underwriting Agreement</TITLE>
</HEAD>
 <BODY BGCOLOR="WHITE">
 <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="right"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Exhibit 1.1 </B></FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px"
ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>SOUTHERN NATIONAL BANCORP OF VIRGINIA, INC. </B></FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">4,166,666
Shares of Common Stock, $0.01 par value </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">Underwriting Agreement </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px"
ALIGN="right"><FONT STYLE="font-family:Times New Roman" SIZE="2">October&nbsp;29, 2009 </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">FIG Partners, LLC </FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">1175 Peachtree Street N.E. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">100 Colony Square Suite
2250 </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Atlanta, Georgia 30361 </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Ladies
and Gentlemen: </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Southern National Bancorp of Virginia, Inc., a Virginia corporation and bank holding company (the
&#147;Company&#148;), proposes to issue and sell to FIG Partners, LLC (the &#147;Underwriter&#148;) 4,166,666 shares of common stock, par value $0.01 per share, of the Company (the &#147;Underwritten Shares&#148;) and, at the option of the
Underwriter, up to an additional 624,999 shares of common stock of the Company (the &#147;Option Shares&#148;). The Underwritten Shares and the Option Shares are herein referred to as the &#147;Shares&#148;. The shares of common stock of the Company
to be outstanding after giving effect to the sale of the Shares are referred to herein as the &#147;Stock&#148;. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">The Company
also proposes, subject to the terms of this Agreement, the applicable rules, regulations and interpretations of the Financial Industry Regulatory Authority, Inc. (&#147;FINRA&#148;) and all other applicable laws, rules and regulations, that 416,666
of the Underwritten Shares (the &#147;Directed Shares&#148;) shall be reserved for sale by the Underwriters to certain officers, directors and other persons designated by the Company (&#147;Directed Share Purchasers&#148;). To the extent that sales
of Directed Shares are not orally confirmed for purchase by Directed Share Purchasers by 9:00 A.M., Eastern Time, on the first trading day after the date of this Agreement, the Directed Shares will be offered to the public as part of the offering.
</FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">The Company hereby confirms its agreement with the Underwriter concerning the purchase and sale of the Shares, as follows:
</FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">1. <U>Registration Statement</U>. The Company has prepared and filed with the Securities and Exchange Commission (the
&#147;Commission&#148;) under the Securities Act of 1933, as amended, and the rules and regulations of the Commission thereunder (collectively, the &#147;Securities Act&#148;), a registration statement (File No.&nbsp;333-162467), including a
prospectus, relating to the Shares. Such registration statement, as amended at the time it became effective, including the information, if any, deemed pursuant to Rule 430A, 430B or 430C under the Securities Act to be part of the registration
statement at the time of its effectiveness (&#147;Rule 430 Information&#148;), is referred to herein as the &#147;Registration Statement;&#148; and as used herein, the term &#147;Preliminary Prospectus&#148; means each prospectus included in such
registration statement (and any amendments thereto) before effectiveness, any prospectus filed with the Commission pursuant to Rule 424(a) under the Securities Act and the prospectus included in the Registration Statement at the time of its
effectiveness that omits Rule 430 Information, and the term &#147;Prospectus&#148; means the prospectus in the form first used (or made available upon request of purchasers pursuant to Rule 173 under the Securities Act) in connection with
confirmation of sales of the Shares. If the Company has filed an abbreviated registration statement pursuant to Rule 462(b) under the Securities Act (the &#147;Rule 462 Registration Statement&#148;), then any reference herein to the term
&#147;Registration Statement&#148; shall be deemed
</FONT></P>

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to include such Rule 462 Registration Statement. Any reference in this Agreement to the Registration Statement, any Preliminary Prospectus or the Prospectus shall be deemed to refer to and
include the documents incorporated by reference therein pursuant to Item&nbsp;12 of Form S-1 under the Securities Act, as of the effective date of the Registration Statement or the date of such Preliminary Prospectus or the Prospectus, as the case
may be. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">The term &#147;General Disclosure Package&#148; shall mean (i)&nbsp;the Preliminary Prospectus, if any, used most
recently prior to the date and time as of which the Registration Statement was declared effective by the Commission, and (ii)&nbsp;any other &#147;free writing prospectus&#148; (as defined pursuant to Rule 405 under the Securities Act) that the
parties hereto shall hereafter expressly agree in writing to treat as part of the General Disclosure Package. &#147;Applicable Time&#148; shall mean 6:00 p.m. Eastern Time on the date of execution and delivery of this Agreement. </FONT></P> <P
STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">2. <U>Purchase of the Shares by the Underwriter</U>. </FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(a) The Company agrees to issue and sell the Underwritten Shares to the Underwriter as provided in this Agreement, and the
Underwriter, on the basis of the representations, warranties and agreements set forth herein and subject to the conditions set forth herein, agrees to purchase from the Company the: (i)&nbsp;Underwritten Shares, excluding the Directed Shares, at a
price per share (the &#147;Purchase Price&#148;) of $5.715; and (ii)&nbsp;Directed Shares at a price per share of $5.94. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">In
addition, the Company agrees to issue and sell the Option Shares to the Underwriter to cover over-allotments as provided in this Agreement, and the Underwriter, on the basis of the representations, warranties and agreements set forth herein and
subject to the conditions set forth herein, shall have the option to purchase from the Company the Option Shares at the Purchase Price less an amount per share equal to any dividends or distributions declared by the Company and payable on the
Underwritten Shares but not payable on the Option Shares. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">The Underwriter may exercise the option to purchase Option Shares
at any time in whole, or from time to time in part, on or before the thirtieth day following the date of the Prospectus, by written notice from the Underwriter to the Company. Such notice shall set forth the number of Option Shares as to which the
option is being exercised and the date and time when the Option Shares are to be delivered and paid for, which may be the same date and time as the Closing Date (as hereinafter defined) but shall not be earlier than the Closing Date or later than
the tenth full business day (as hereinafter defined) after the date of such notice. Any such notice shall be given at least two business days prior to the date and time of delivery specified therein. </FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(b) The Company understands that the Underwriter intends to make a public offering of the Shares as soon after the
effectiveness of this Agreement as in the judgment of the Underwriter is advisable, and initially to offer the Shares on the terms set forth in the Prospectus. The Company acknowledges and agrees that the Underwriter may offer and sell Shares to or
through any affiliate of the Underwriter. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(c) Payment for the Shares shall be made by wire transfer in
immediately available funds to the account specified by the Company to the Underwriter in the case of the Underwritten Shares, at the offices of Alston&nbsp;&amp; Bird LLP at 10:00 A.M., Eastern Time, on November&nbsp;4, 2009, or at such other time
or place on the same or such other date, not later than the fifth business day thereafter, as the Underwriter and the Company may agree upon in writing or, in the case of the Option Shares, on the date and at the time and place specified by the
Underwriter in the written notice of the Underwriter&#146;s election to purchase such Option Shares. The time and date of such payment for the Underwritten Shares is referred to herein as the &#147;Closing Date&#148;, and the time and date for such
payment for the Option Shares, if other than the Closing Date, is herein referred to as the &#147;Additional Closing Date&#148;. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Payment for the Shares to be purchased on the Closing Date or the Additional Closing Date,
as the case may be, shall be made against delivery to the Underwriter of the Shares with any transfer taxes payable in connection with the sale of such Shares duly paid by the Company. Delivery of the Shares shall be made through the facilities of
The Depository Trust Company (&#147;DTC&#148;) unless the Underwriter shall otherwise instruct. The certificates for the Shares will be made available for inspection and packaging by the Underwriter at the office of DTC or its designated custodian
not later than 1:00 P.M., Eastern Time, on the business day prior to the Closing Date or the Additional Closing Date, as the case may be. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">(d) The Company acknowledges and agrees that the Underwriter is acting solely in the capacity of an arm&#146;s length contractual counterparty to the Company with respect to the offering of Shares
contemplated hereby (including in connection with determining the terms of the offering) and not as a financial advisor or a fiduciary to, or an agent of, the Company or any other person. Additionally, the Underwriter is not advising the Company or
any other person as to any legal, tax, investment, accounting or regulatory matters in any jurisdiction. The Company shall consult with its own advisors concerning such matters and shall be responsible for making its own independent investigation
and appraisal of the transactions contemplated hereby, and the Underwriter shall have no responsibility or liability to the Company with respect thereto. Any review by the Underwriter of the Company, the transactions contemplated hereby or other
matters relating to such transactions will be performed solely for the benefit of the Underwriter and shall not be on behalf of the Company. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">(e) [<I>Reserved</I>.] </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">3. <U>Representations and Warranties of the Company</U>.
The Company represents and warrants to the Underwriter that: </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(a) <I>Preliminary Prospectus.</I> No order
preventing or suspending the use of any Preliminary Prospectus has been issued by the Commission, and any Preliminary Prospectus included in the General Disclosure Package, at the time of filing thereof, complied in all material respects with the
Securities Act, and no Preliminary Prospectus, at the time of filing thereof, contained any untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading; <U>provided</U> that the Company makes no representation or warranty with respect to any statements or omissions made in reliance upon and in conformity with information relating to the Underwriter
furnished to the Company in writing by the Underwriter expressly for use in any Preliminary Prospectus, it being understood and agreed that the only such information furnished by the Underwriter consists of the information described as such in
Section&nbsp;7(b) hereof. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(b) <I>General Disclosure Package</I>. The General Disclosure Package as of the
Applicable Time did not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading; <U>provided</U>
that the Company makes no representation or warranty with respect to any statements or omissions made in reliance upon and in conformity with information relating to the Underwriter furnished to the Company in writing by the Underwriter expressly
for use in such General Disclosure Package, it being understood and agreed that the only such information furnished by the Underwriter consists of the information described as such in Section&nbsp;7(b) hereof. </FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(c) <I>Issuer Free Writing Prospectus. </I>Other than the Registration
Statement, the Preliminary Prospectus and the Prospectus, the Company (including its agents and representatives, other than the Underwriter in its capacity as such) has not prepared, used, authorized, approved or referred to and will not prepare,
use, authorize, approve or refer to any &#147;written communication&#148; (as defined in Rule 405 under the Securities Act) that constitutes an offer to sell or solicitation of an offer to buy the Shares (each such communication by the Company or
its agents (other than a communication referred to in clause (i)&nbsp;below) an &#147;Issuer Free Writing Prospectus&#148;) other than (i)&nbsp;any document not constituting a prospectus pursuant to Section&nbsp;2(a)(10)(a) of the Securities Act or
Rule 134 under the Securities Act or (ii)&nbsp;each electronic road show and any other written communications approved in writing in advance by the Underwriter. Each such Issuer Free Writing Prospectus complied in all material respects with the
Securities Act, has been or will be (within the time period specified in Rule 433) filed in accordance with the Securities Act (to the extent required thereby) and, such Issuer Free Writing Prospectus did not, and as of the Closing Date and as of
the Additional Closing Date, as the case may be, will not, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made,
not misleading; <U>provided</U> that the Company makes no representation or warranty with respect to any statements or omissions made in each such Issuer Free Writing Prospectus or Preliminary Prospectus in reliance upon and in conformity with
information relating to the Underwriter furnished to the Company in writing by the Underwriter expressly for use in such Issuer Free Writing Prospectus or Preliminary Prospectus, it being understood and agreed that the only such information
furnished by the Underwriter consists of the information described as such in Section&nbsp;7(b) hereof. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(d)
<I>Registration Statement and Prospectus.</I> The Registration Statement has been declared effective by the Commission under the Securities Act. No order suspending the effectiveness of the Registration Statement has been issued by the Commission,
and no proceeding for that purpose or pursuant to Section&nbsp;8A of the Securities Act against the Company or related to the offering of the Shares has been initiated or threatened by the Commission; as of the applicable effective date of the
Registration Statement and any post-effective amendment thereto, the Registration Statement and any such post-effective amendment complied and will comply in all material respects with the Securities Act, and did not and will not contain any untrue
statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein not misleading; and as of the date of the Prospectus and any amendment or supplement thereto and as of
the Closing Date and as of the Additional Closing Date, as the case may be, the Prospectus will not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading; <U>provided</U> that the Company makes no representation or warranty with respect to any statements or omissions made in reliance upon and in conformity with information relating to the
Underwriter furnished to the Company in writing by the Underwriter expressly for use in the Registration Statement and the Prospectus and any amendment or supplement thereto, it being understood and agreed that the only such information furnished by
the Underwriter consists of the information described as such in Section&nbsp;7(b) hereof. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(e) <I>Incorporated
Documents.</I> The documents incorporated by reference in the Registration Statement, the Prospectus and the General Disclosure Package, when they were filed with the Commission conformed in all material respects to the requirements of the Exchange
Act, and none of such documents contained any untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. </FONT></P>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(f) <I>Financial Statements.</I> The financial statements (including the related notes thereto) of the Company and its
consolidated subsidiary included or incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus comply in all material respects with the
</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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applicable requirements of the Securities Act and the Exchange Act, as applicable, and present fairly in all material respects the financial position of the Company and its consolidated
subsidiary as of the dates indicated and the results of their operations and the changes in their cash flows for the periods specified; such financial statements have been prepared in conformity with generally accepted accounting principles in the
United States (&#147;GAAP&#148;) applied on a consistent basis throughout the periods covered thereby, and any supporting schedules included or incorporated by reference in the Registration Statement present fairly the information required to be
stated therein; and the other financial information included or incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus has been derived from the accounting records of the Company and its
consolidated subsidiary and presents fairly the information shown thereby. No other financial statements or schedules are required to be included in the Registration Statement. Except as set forth on Schedule A hereto, to the extent applicable, all
disclosures contained in the Registration Statement, the General Disclosure Package or the Prospectus regarding &#147;non-GAAP financial measures&#148; (as such term is defined by the rules and regulations of the Commission) comply with Regulation G
of the Exchange Act and Item&nbsp;10 of Regulation S-K under the Securities Act, as applicable. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(g) <I>No
Material Adverse Change.</I> Since the date of the most recent financial statements of the Company included or incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus, (i)&nbsp;there has not been
any (a)&nbsp;change in the capital stock (other than the issuance of shares of common stock upon exercise of stock options and warrants described as outstanding in, and the grant of options and awards under existing equity incentive plans described
in, the Registration Statement, the General Disclosure Package and the Prospectus) or any dividend or distribution of any kind declared, set aside for payment, paid or made by the Company on any class of capital stock, (b)&nbsp;material change in
short-term debt or long-term debt of the Company or its subsidiary, or (c)&nbsp;any material adverse change, or any development involving a prospective material adverse change, in or affecting the business, properties, management, financial
position, stockholders&#146; equity, results of operations or prospects of the Company and its subsidiary taken as a whole; (ii)&nbsp;neither the Company nor its subsidiary has entered into any transaction or agreement (whether or not in the
ordinary course of business) that is material to the Company and its subsidiary taken as a whole or incurred any liability or obligation, direct or contingent, that is material to the Company and its subsidiary taken as a whole; and
(iii)&nbsp;neither the Company nor its subsidiary has sustained any loss or interference with its business that is material to the Company and its subsidiary taken as a whole and that is either from fire, explosion, flood or other calamity, whether
or not covered by insurance, or from any labor disturbance or dispute or any action, order or decree of any court or arbitrator or governmental or regulatory authority, except in each case as otherwise disclosed in the Registration Statement, the
General Disclosure Package and the Prospectus. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(h) <I>Organization and Good Standing.</I> The Company and its
subsidiary have been duly organized and are validly existing and in good standing under the laws of the Commonwealth of Virginia and, in the case of Sonabank, is validly chartered as a Virginia state bank. The Company and its subsidiary are duly
qualified to do business and are in good standing in each jurisdiction in which their respective ownership or lease of property or the conduct of their respective businesses requires such qualification, and have all power and authority necessary to
own or hold their respective properties and to conduct the businesses in which they are engaged, except where the failure to be so qualified or in good standing or have such power or authority would not, individually or in the aggregate, have a
material adverse effect on the business, properties, management, financial position, stockholders&#146; equity, results of operations or prospects of the Company and its subsidiary taken as a whole or on the performance by the Company of its
obligations under this Agreement (a &#147;Material Adverse Effect&#148;). The Company is duly registered as a bank holding company under the Bank Holding Company Act of 1956, as amended (the &#147;BHCA&#148;), and meets the applicable requirements
for qualification as such. The Company does not own or control, directly or indirectly, any corporation, association or other entity other than Sonabank, as listed in Exhibit 21.0 to the Company&#146;s Annual Report on Form 10-K for the year ended
December&nbsp;31, 2008. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(i) <I>Capitalization.</I> The Company has an authorized capitalization as
set forth in the Registration Statement, the General Disclosure Package and the Prospectus under the heading &#147;Capitalization;&#148; all the outstanding shares of capital stock of the Company have been duly and validly authorized and issued and
are fully paid and non-assessable and are not subject to any pre-emptive or similar rights; except as described in or expressly contemplated by the General Disclosure Package and the Prospectus, there are no outstanding rights (including, without
limitation, pre-emptive rights), warrants or options to acquire, or instruments convertible into or exchangeable for, any shares of capital stock or other equity interest in the Company or its subsidiary, or any contract, commitment, agreement,
understanding or arrangement of any kind relating to the issuance of any capital stock of the Company or any such subsidiary, any such convertible or exchangeable securities or any such rights, warrants or options; the capital stock of the Company
conforms in all material respects to the description thereof contained in the Registration Statement, the General Disclosure Package and the Prospectus; and all the outstanding shares of capital stock or other equity interests of its subsidiary
owned, directly or indirectly, by the Company have been duly and validly authorized and issued, are fully paid and non-assessable and are owned directly or indirectly by the Company, free and clear of any lien, charge, encumbrance, security
interest, restriction on voting or transfer or any other claim of any third party. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(j) <I>Stock Options.
</I>With respect to the stock options (the &#147;Stock Options&#148;) granted pursuant to the stock-based compensation plans of the Company and its subsidiary (the &#147;Company Stock Plans&#148;), (i)&nbsp;each Stock Option intended to qualify as
an &#147;incentive stock option&#148; under Section&nbsp;422 of the Internal Revenue Code of 1986, as amended (the &#147;Code&#148;) so qualifies, (ii)&nbsp;each grant of a Stock Option was duly authorized no later than the date on which the grant
of such Stock Option was by its terms to be effective (the &#147;Grant Date&#148;) by all necessary corporate action, including, as applicable, approval by the board of directors of the Company (or a duly constituted and authorized committee
thereof) and any required stockholder approval by the necessary number of votes or written consents, and the award agreement governing such grant (if any) was duly executed and delivered by each party thereto, (iii)&nbsp;each such grant was made in
accordance with the terms of the Company Stock Plans, the Exchange Act and all other applicable laws and regulatory rules or requirements, including the rules of the Nasdaq Global Market and any other exchange on which Company securities are traded,
and (iv)&nbsp;each such grant was properly accounted for, in all material respects, in accordance with GAAP in the financial statements (including the related notes) of the Company and disclosed in the Company&#146;s filings with the Commission in
accordance with the Exchange Act and all other applicable laws. The Company has not knowingly granted, and there is no and has been no policy or practice of the Company of granting, Stock Options prior to, or otherwise coordinating the grant of
Stock Options with, the release or other public announcement of material information regarding the Company or its subsidiary or their results of operations or prospects. </FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(k) <I>Due Authorization.</I> The Company has full right, power and authority to execute and deliver this Agreement and to
perform its obligations hereunder; and all action required to be taken for the due and proper authorization, execution and delivery by it of this Agreement and the consummation by it of the transactions contemplated hereby has been duly and validly
taken. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(l) <I>Underwriting Agreement. </I>This Agreement has been duly authorized, executed and delivered by
the Company. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(m) <I>The Shares. </I>The Shares to be issued and sold by the Company
hereunder have been duly authorized and, when issued and delivered and paid for as provided herein, will be duly and validly issued, will be fully paid and nonassessable and will conform to the descriptions thereof in the Registration Statement, the
General Disclosure Package and the Prospectus; and the issuance of the Shares is not subject to any preemptive or similar rights. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">(n) <I>No Violation or Default.</I> Neither the Company nor its subsidiary is (i)&nbsp;in violation of its charter or by-laws or similar organizational documents; (ii)&nbsp;in default, and no event has
occurred that, with notice or lapse of time or both, would constitute such a default, in the due performance or observance of any term, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or its subsidiary is a party or by which the Company or its subsidiary is bound or to which any of the property or assets of the Company or its subsidiary is subject; or (iii)&nbsp;in violation of any law or statute
or any judgment, order, rule or regulation of any court or arbitrator or governmental or regulatory authority, except, in the case of clauses (ii)&nbsp;and (iii)&nbsp;above, for any such default or violation that would not, individually or in the
aggregate, have a Material Adverse Effect. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(o) <I>No Conflicts. </I>The execution, delivery and performance by
the Company of this Agreement, the issuance and sale of the Shares and the consummation of the transactions contemplated by this Agreement will not (i)&nbsp;conflict with or result in a breach or violation of any of the terms or provisions of, or
constitute a default under, or result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Company or its subsidiary pursuant to, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company or its subsidiary is a party or by which the Company or its subsidiary is bound or to which any of the property or assets of the Company or its subsidiary is subject, (ii)&nbsp;result in any violation of
the provisions of the charter or by-laws or similar organizational documents of the Company or its subsidiary or (iii)&nbsp;result in the violation of any law or statute or any judgment, order, rule or regulation of any court or arbitrator or
governmental or regulatory authority, except, in the case of clauses (i)&nbsp;and (iii)&nbsp;above, for any such conflict, breach, violation or default that would not, individually or in the aggregate, have a Material Adverse Effect. </FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(p) <I>No Consents Required.</I> No consent, approval, authorization, order, license, registration or qualification of or
with any court or arbitrator or governmental or regulatory authority is required for the execution, delivery and performance by the Company of this Agreement, the issuance and sale of the Shares and the consummation of the transactions contemplated
by this Agreement, except for the registration of the Shares under the Securities Act and such consents, approvals, authorizations, orders and registrations or qualifications as may be required by the FINRA, the Nasdaq Global Market and under
applicable state securities laws in connection with the purchase and distribution of the Shares by the Underwriter. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman"
SIZE="2">(q) <I>Legal Proceedings.</I> Except as described in the Registration Statement, the General Disclosure Package and the Prospectus, there are no legal, governmental or regulatory investigations, actions, suits or proceedings pending to
which the Company or its subsidiary is or may be a party or to which any property of the Company or its subsidiary is or may be the subject that, individually or in the aggregate, if determined adversely to the Company or its subsidiary, could
reasonably be expected to have a Material Adverse Effect; to the knowledge of the Company, no such investigations, actions, suits or proceedings are threatened or contemplated by any governmental or regulatory authority or threatened by others; and
(i)&nbsp;there are no current or pending legal, governmental or regulatory actions, suits or proceedings that are required under the Securities Act to be described in the Registration Statement, the General Disclosure Package or the Prospectus that
are not so described in the Registration Statement, the General Disclosure Package and the Prospectus and (ii)&nbsp;there are no contracts or other documents that are required under the Securities Act to be filed as exhibits to the Registration
Statement or described in the Registration Statement, the General Disclosure Package or the Prospectus that are not so filed as exhibits to the Registration Statement or described in the Registration Statement, the General Disclosure Package and the
Prospectus. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(r) <I>Independent Accountants</I>. BDO Seidman, LLP and Crowe Horwath LLP,
who have certified certain financial statements of the Company and its subsidiary, are each an independent registered public accounting firm with respect to the Company and its subsidiary within the applicable rules and regulations adopted by the
Commission and the Public Company Accounting Oversight Board (United States) and as required by the Securities Act. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman"
SIZE="2">(s) <I>Title to Real and Personal Property</I>. The Company and its subsidiary have good and marketable title in fee simple (in the case of real property) to, or have valid and marketable rights to lease or otherwise use, all items of real
and personal property and assets that are material to the respective businesses of the Company and its subsidiary, in each case free and clear of all liens, encumbrances, claims and defects and imperfections of title except those that (i)&nbsp;do
not materially interfere with the use made and proposed to be made of such property by the Company and its subsidiary or (ii)&nbsp;could not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect. </FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(t) <I>Title to Intellectual Property</I>. The Company and its subsidiary own or possess adequate rights to use all material
patents, patent applications, trademarks, service marks, trade names, trademark registrations, service mark registrations, copyrights, licenses and know-how (including trade secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures) necessary for the conduct of their respective businesses as currently conducted and as believed to be necessary as proposed to be conducted, and the conduct of their respective businesses will not
conflict in any material respect with any such rights of others. The Company and its subsidiary have not received any notice of any claim of infringement, misappropriation or conflict with any such rights of others in connection with its patents,
patent rights, licenses, inventions, trademarks, service marks, trade names, copyrights and know-how, which could reasonably be expected to result in a Material Adverse Effect. </FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(u) <I>No Undisclosed Relationships</I>. No relationship, direct or indirect, exists between or among the Company or its
subsidiary, on the one hand, and the directors, officers, stockholders, customers or suppliers of the Company or its subsidiary, on the other, that is required by the Securities Act to be described in the Registration Statement and the Prospectus
and that is not so described in such documents and in the General Disclosure Package. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(v) <I>Investment
Company Act</I>. The Company is not and, after giving effect to the offering and sale of the Shares and the application of the proceeds thereof as described in the Registration Statement, the General Disclosure Package and the Prospectus, will not
be required to register as an &#147;investment company&#148; or an entity &#147;controlled&#148; by an &#147;investment company&#148; within the meaning of the Investment Company Act of 1940, as amended, and the rules and regulations of the
Commission thereunder (collectively, the &#147;Investment Company Act&#148;). </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(w) <I>Taxes</I>. The Company
and its subsidiary have paid all federal, state, local and foreign taxes and filed all tax returns, or extensions thereof, required to be paid or filed through the date hereof, except with respect to any taxes that would not have a Material Adverse
Effect; and except as otherwise disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, there is no tax deficiency that has been, or could reasonably be expected to be, asserted against the Company or its
subsidiary or any of their respective properties or assets, except for tax deficiencies that would not have a Material Adverse Effect. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(x) <I>Licenses and Permits.</I> The Company and its subsidiary possess all
licenses, certificates, permits and other authorizations issued by, and have made all declarations and filings with, the appropriate federal, state, local or foreign governmental or regulatory authorities that are necessary for the ownership or
lease of their respective properties or the conduct of their respective businesses as described in the Registration Statement, the General Disclosure Package and the Prospectus, except where the failure to possess or make the same would not,
individually or in the aggregate, have a Material Adverse Effect; and except as described in the Registration Statement, the General Disclosure Package and the Prospectus, neither the Company nor its subsidiary has received notice of any revocation
or modification of any such license, certificate, permit or authorization or has any reason to believe that any such license, certificate, permit or authorization will not be renewed in the ordinary course, except as would not have a Material
Adverse Effect. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(y) <I>No Labor Disputes.</I> No labor disturbance by or dispute with employees of the Company
or its subsidiary exists or, to the knowledge of the Company, is contemplated or threatened, and the Company is not aware of any existing or imminent labor disturbance by, or dispute with, the employees of any of its or its subsidiary&#146;s&#146;
principal suppliers, contractors or customers, except as would not have a Material Adverse Effect. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(z)
<I>Compliance with and Liability under Environmental Laws.</I> (i)&nbsp;The Company and its subsidiary (a)&nbsp;are, and at all prior times were, in compliance with any and all applicable federal, state, local and foreign laws, rules, regulations,
requirements, decisions, judgments, decrees, orders and the common law relating to pollution or the protection of the environment, natural resources or human health or safety, including those relating to the generation, storage, treatment, use,
handling, transportation, Release or threat of Release of Hazardous Materials (collectively, &#147;Environmental Laws&#148;), (b)&nbsp;have received and are in compliance with all permits, licenses, certificates or other authorizations or approvals
required of them under applicable Environmental Laws to conduct their respective businesses, (c)&nbsp;have not received notice of any actual or potential liability under or relating to, or actual or potential violation of, any Environmental Laws,
including for the investigation or remediation of any Release or threat of Release of Hazardous Materials, and have no knowledge of any event or condition that would reasonably be expected to result in any such notice, (d)&nbsp;are not conducting or
paying for, in whole or in part, any investigation, remediation or other corrective action pursuant to any Environmental Law at any location, and (e)&nbsp;are not a party to any order, decree or agreement that imposes any obligation or liability
under any Environmental Law; and (ii)&nbsp;there are no costs or liabilities associated with Environmental Laws of or relating to the Company or its subsidiary, except in the case of each of (i)&nbsp;and (ii)&nbsp;above, for any such matter, as
would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; and (iii)&nbsp;except as described in the Registration Statement, the General Disclosure Package and the Prospectus, (a)&nbsp;there are no
proceedings that are pending, or that are known to be contemplated, against the Company or its subsidiary under any Environmental Laws in which a governmental entity is also a party, other than such proceedings regarding which it is reasonably
expected no monetary sanctions of $100,000 or more will be imposed, and (b)&nbsp;the Company and its subsidiary are not aware of any facts or issues regarding compliance with Environmental Laws, or liabilities or other obligations under
Environmental Laws, including the Release or threat of Release of Hazardous Materials, that could reasonably be expected to have a Material Adverse Effect. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">(aa) <I>Hazardous Materials</I>. To the knowledge of the Company and its subsidiary, there has been no storage, generation, transportation, use, handling, treatment, Release or threat of Release of
Hazardous Materials by, relating to or caused by the Company or its subsidiary (or, to the knowledge of the Company and its subsidiary, any other entity (including any predecessor) for whose acts or omissions the Company or its subsidiary is or
could reasonably be expected to be liable) at, on, under or from any property or facility now or previously owned, operated or leased by the Company or its
</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">
subsidiary, or at, on, under or from any other property or facility, in violation of any Environmental Laws or in a manner or amount or to a location that could reasonably be expected to result
in any liability under any Environmental Law, except for any violation or liability which would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. &#147;Hazardous Materials&#148; means any material,
chemical, substance ,waste, pollutant, contaminant, compound, mixture, or constituent thereof, in any form or amount, including petroleum (including crude oil or any fraction thereof) and petroleum products, natural gas liquids, asbestos and
asbestos containing materials, naturally occurring radioactive materials, brine, and drilling mud, regulated or which can reasonably be expected to give rise to liability under any Environmental Law. &#147;Release&#148; means any spilling, leaking,
seepage, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, disposing, depositing, dispersing, or migrating in, into or through the environment, or in, into from or through any building or structure.
</FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(bb) <I>Compliance with ERISA</I>. (i)&nbsp;Each employee benefit plan, within the meaning of
Section&nbsp;3(3) of the Employee Retirement Income Security Act of 1974, as amended (&#147;ERISA&#148;), for which the Company or any member of its &#147;Controlled Group&#148; (defined as any organization which is a member of a controlled group of
corporations within the meaning of Section&nbsp;414 of the Code) would have any liability (each, a &#147;Plan&#148;) has been maintained in compliance with its terms and the requirements of any applicable statutes, orders, rules and regulations,
including but not limited to ERISA and the Code, except for noncompliance that could not reasonably be expected to result in material liability to the Company or its subsidiary; (ii)&nbsp;no prohibited transaction, within the meaning of
Section&nbsp;406 of ERISA or Section&nbsp;4975 of the Code, has occurred with respect to any Plan excluding transactions effected pursuant to a statutory or administrative exemption that could reasonably be expected to result in a material liability
to the Company or its subsidiary; (iii)&nbsp;for each Plan that is subject to the funding rules of Section&nbsp;412 of the Code or Section&nbsp;302 of ERISA, the minimum funding standard of Section&nbsp;412 of the Code or Section&nbsp;302 of ERISA,
as applicable, has been satisfied (without taking into account any waiver thereof or extension of any amortization period) and is reasonably expected to be satisfied in the future (without taking into account any waiver thereof or extension of any
amortization period); (iv)&nbsp;the fair market value of the assets of each Plan subject to Title IV of ERISA exceeds the present value of all benefits accrued under such Plan (determined based on those assumptions used to fund such Plan);
(v)&nbsp;no &#147;reportable event&#148; (within the meaning of Section&nbsp;4043(c) of ERISA) has occurred or is reasonably expected to occur that either has resulted, or could reasonably be expected to result, in material liability to the Company
or its subsidiary; (vi)&nbsp;neither the Company nor any member of the Controlled Group has incurred, nor reasonably expects to incur, any liability under Title IV of ERISA (other than contributions to the Plan or premiums to the Pension Benefit
Guaranty Corporation, in the ordinary course and without default) in respect of a Plan (including a &#147;multiemployer plan&#148;, within the meaning of Section&nbsp;4001(a)(3) of ERISA); and (vii)&nbsp;there is no pending audit or investigation by
the Internal Revenue Service, the U.S. Department of Labor, the Pension Benefit Guaranty Corporation or any other governmental agency or any foreign regulatory agency with respect to any Plan that could reasonably be expected to result in material
liability to the Company or its subsidiary. None of the following events has occurred or is reasonably likely to occur: (x)&nbsp;a material increase in the aggregate amount of contributions required to be made to all Plans by the Company or its
subsidiary in the current fiscal year of the Company and its subsidiary compared to the amount of such contributions made in the Company and its subsidiary&#146;s most recently completed fiscal year; or (y)&nbsp;a material increase in the Company
and its subsidiary&#146;s &#147;accumulated post-retirement benefit obligations&#148; (within the meaning of Statement of Financial Accounting Standards 106) compared to the amount of such obligations in the Company and its subsidiary&#146;s most
recently completed fiscal year. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(cc) <I>Disclosure Controls</I>. The Company and its subsidiary maintain an
effective system of &#147;disclosure controls and procedures&#148; (as defined in Rule 13a-15(e) of the Exchange Act) that complies with the requirements of the Exchange Act and that has been designed to ensure that information required to be
disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Commission&#146;s rules and forms, including controls and procedures
designed to ensure that such information is accumulated and communicated to the Company&#146;s management as appropriate to allow timely decisions regarding required disclosure. The Company and its subsidiary have carried out evaluations of the
effectiveness of their disclosure controls and procedures as required by Rule 13a-15 of the Exchange Act. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(dd)
<I>Accounting Controls</I>. The Company and its subsidiary maintain systems of &#147;internal control over financial reporting&#148; (as defined in Rule 13a-15(f) of the Exchange Act) that comply with the requirements of the Exchange Act and have
been designed by, or under the supervision of, their respective principal executive and principal financial officers, or persons performing similar functions, to provide reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with GAAP, including, but not limited to, internal accounting controls sufficient to provide reasonable assurance that (i)&nbsp;transactions are executed in accordance with
management&#146;s general or specific authorizations; (ii)&nbsp;transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain asset accountability; (iii)&nbsp;access to assets is
permitted only in accordance with management&#146;s general or specific authorization; and (iv)&nbsp;the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to
any differences. Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, there are no material weaknesses in the Company&#146;s internal controls. The Company&#146;s auditors and the Audit Committee of
the Board of Directors of the Company have been advised of: (i)&nbsp;all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which have adversely affected or are reasonably likely
to adversely affect the Company&#146;s ability to record, process, summarize and report financial information; and (ii)&nbsp;any fraud, whether or not material, that involves management or other employees who have a significant role in the
Company&#146;s internal controls over financial reporting. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(ee) <I>Insurance. </I>The Company and its
subsidiary have insurance covering their respective properties, operations, personnel and businesses, including business interruption insurance, which insurance is in amounts and insures against such losses and risks as are adequate, in the
reasonable belief of the Company, to protect the Company and its subsidiary and their respective businesses; and neither the Company nor its subsidiary has (i)&nbsp;received notice from any insurer or agent of such insurer that capital improvements
or other material expenditures are required or necessary to be made in order to continue such insurance or (ii)&nbsp;any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to
obtain similar coverage at reasonable cost from similar insurers as may be necessary to continue its business. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman"
SIZE="2">(ff) <I>No Unlawful Payments.</I> Neither the Company nor its subsidiary nor, to the knowledge of the Company, any director, officer, agent, employee or other person associated with or acting on behalf of the Company or its subsidiary has
(i)&nbsp;used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity; (ii)&nbsp;made any direct or indirect unlawful payment to any foreign or domestic government official or
employee from corporate funds; (iii)&nbsp;violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977; or (iv)&nbsp;made any bribe, rebate, payoff, influence payment, kickback or other unlawful payment. </FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(gg) <I>Compliance with Money Laundering Laws</I>. The operations of the Company and its subsidiary are and have been
conducted at all times in compliance in all material respects with applicable financial recordkeeping and reporting requirements of the Currency and Foreign
</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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Transactions Reporting Act of 1970, as amended, the money laundering statutes of all jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or
guidelines, issued, administered or enforced by any governmental agency (collectively, the &#147;Money Laundering Laws&#148;) and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator
involving the Company or its subsidiary with respect to the Money Laundering Laws is pending or, to the knowledge of the Company, threatened. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">(hh) <I>Compliance with OFAC. </I>None of the Company, its subsidiary or, to the knowledge of the Company, any director, officer, agent, employee or affiliate of the Company or its subsidiary is currently
subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury (&#147;OFAC&#148;); and the Company will not, directly or indirectly, use the proceeds of the offering of the Shares hereunder,
or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity, for the purpose of financing the activities of any person currently subject to any U.S. sanctions administered by OFAC.
</FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(ii) <I>No Restrictions on Subsidiary</I>. Except in each case as otherwise disclosed in the Registration
Statement, the General Disclosure Package and the Prospectus, the subsidiary of the Company is not currently prohibited, directly or indirectly, under any agreement or other instrument to which it is a party or is subject, from paying any dividends
to the Company, from making any other distribution on the subsidiary&#146;s capital stock, from repaying to the Company any loans or advances to the subsidiary from the Company or from transferring any of the subsidiary&#146;s properties or assets
to the Company. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(jj) <I>No Broker&#146;s Fees</I>. Neither the Company nor its subsidiary is a party to any
contract, agreement or understanding with any person (other than this Agreement) that would give rise to a valid claim against the Company or its subsidiary or the Underwriter for a brokerage commission, finder&#146;s fee or like payment in
connection with the offering and sale of the Shares. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(kk) <I>No Registration Rights</I>. No person has the
right to require the Company or its subsidiary to register any securities for sale under the Securities Act by reason of the filing of the Registration Statement with the Commission or the issuance and sale of the Shares. </FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(ll) <I>No Stabilization</I>. The Company has not taken, directly or indirectly, any action designed to or that could
reasonably be expected to cause or result in any stabilization or manipulation of the price of the Shares. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman"
SIZE="2">(mm) <I>Reserved. </I> </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(nn) <I>Forward-Looking Statements.</I> No forward-looking statement (within
the meaning of Section&nbsp;27A of the Securities Act and Section&nbsp;21E of the Exchange Act) contained in the Registration Statement, the General Disclosure Package or the Prospectus has been made or reaffirmed without a reasonable basis or has
been disclosed other than in good faith. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(oo) <I>Statistical and Market Data.</I> The statistical and
market-related data included in the Registration Statement, the General Disclosure Package and the Prospectus are based on or derived from sources that the Company reasonably believes are reliable and accurate in all material respects. </FONT></P>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(pp) <I>Sarbanes-Oxley Act</I>. There is and has been no failure on the part of the Company or, to the knowledge of the
Company, any of the Company&#146;s directors or officers, in their capacities as such, to comply with any provision of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in connection therewith, including Section&nbsp;402
related to loans and Sections 302 and 906 related to certifications. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
 <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">12 </FONT></P>


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 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(qq) <I>Status under the Securities Act</I>. At the time of filing the
Registration Statement and any post-effective amendment thereto, at the earliest time thereafter that the Company or any offering participant made a <I>bona fide</I> offer (within the meaning of Rule 164(h)(2) under the Securities Act) of the Shares
and at the date hereof, the Company was not and is not an &#147;ineligible issuer,&#148; as defined in Rule 405 under the Securities Act. The Company has paid the registration fee for this offering pursuant to Rule 456(a) under the Securities Act or
will pay such fee within the time period required by such rule (without giving effect to the proviso therein) and in any event prior to the Closing Date. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">(rr) <I>Bank Regulatory Authorities</I>. Each of the Company and its subsidiary are in compliance with all applicable laws administered by, and all rules and regulations of, the Board of Governors of the
Federal Reserve System (the &#147;Federal Reserve Board&#148;), the Federal Deposit Insurance Corporation (the &#147;FDIC&#148;), the State Corporation Commission of Virginia, and any other federal or state bank regulatory authorities with
jurisdiction over the Company or its subsidiary (collectively, the &#147;Bank Regulatory Authorities&#148;), except where such noncompliance would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The
deposit accounts of the Company&#146;s subsidiary are insured up to applicable limits by the FDIC and no proceedings for the termination or revocation of such insurance are pending or, to the knowledge of the Company, threatened. Except as set forth
in the Registration Statement, the Prospectus or any Issuer Free Writing Prospectus, neither the Company nor its subsidiary is a party to any written agreement or memorandum of understanding with, or a party to any commitment letter or similar
undertaking to, or is subject to any order or directive by, or is a recipient of any extraordinary supervisory letter from, or has adopted any board of director resolutions at the request of, any Bank Regulatory Authority which currently restricts
the conduct of its business, or relates to its capital adequacy, its credit policies or its management, nor have any of them been advised by any Bank Regulatory Authority that it is contemplating issuing or requesting (or is considering the
appropriateness of issuing or requesting) any such order, decree, agreement, memorandum of understanding, extraordinary supervisory letter, commitment letter or similar submission, or any such board of director resolutions, in each case that are
applicable to the Company or its subsidiary specifically rather than to banks and bank holding companies generally. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">4.
<U>Further Agreements of the Company</U>. The Company covenants and agrees with the Underwriter that: </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(a)
<I>Required Filings</I>. The Company will file the final Prospectus with the Commission within the time periods specified by Rule 424(b) and Rule 430A, 430B or 430C under the Securities Act, will file any Issuer Free Writing Prospectus to the extent
required by Rule 433 under the Securities Act; will file timely all reports and any definitive proxy or information statements required to be filed by the Company with the Commission pursuant to Section&nbsp;13(a), 13(c), 14 or 15(d) of the Exchange
Act subsequent to the date of the Prospectus and for so long as the delivery of a prospectus is required in connection with the offering or sale of the Shares; and will furnish copies of the Prospectus and each Issuer Free Writing Prospectus (to the
extent not previously delivered) to the Underwriter in Atlanta prior to 10:00 A.M., Eastern Time, on the business day next succeeding the date of this Agreement in such quantities as the Underwriter may reasonably request. The Company will pay the
registration fee for this offering within the time period required by Rule 456(a) under the Securities Act (without giving effect to the proviso therein) and in any event prior to the Closing Date. </FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(b) <I>Delivery of Copies.</I> The Company will deliver, without charge,
(i)&nbsp;to the Underwriter, two signed copies of the Registration Statement as originally filed and each amendment thereto, in each case including all exhibits and consents filed therewith; and (ii)&nbsp;to the Underwriter (A)&nbsp;a conformed copy
of the Registration Statement as originally filed and each amendment thereto (without exhibits) and (B)&nbsp;during the Prospectus Delivery Period (as defined below), as many copies of the Prospectus (including all amendments and supplements thereto
and documents incorporated by reference therein and each Issuer Free Writing Prospectus) as the Underwriter may reasonably request. As used herein, the term &#147;Prospectus Delivery Period&#148; means such period of time after the first date of the
public offering of the Shares as in the opinion of counsel for the Underwriter a prospectus relating to the Shares is required by law to be delivered (or required to be delivered but for Rule 172 under the Securities Act) in connection with sales of
the Shares by the Underwriter or any dealer. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(c) <I>Amendments or Supplements, Issuer Free Writing
Prospectuses.</I> Before preparing, using, authorizing, approving, referring to or filing any Issuer Free Writing Prospectus, and before filing any amendment or supplement to the Registration Statement or the Prospectus, the Company will furnish to
the Underwriter and counsel for the Underwriter a copy of the proposed Issuer Free Writing Prospectus, amendment or supplement for review and will not prepare, use, authorize, approve, refer to or file any such Issuer Free Writing Prospectus or file
any such proposed amendment or supplement to which the Underwriter reasonably objects. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(d) <I>Notice to the
Underwriter.</I> The Company will advise the Underwriter promptly, and confirm such advice in writing, (i)&nbsp;when any amendment to the Registration Statement has been filed or becomes effective; (ii)&nbsp;when any supplement to the Prospectus or
any Issuer Free Writing Prospectus or any amendment to the Prospectus has been filed; (iii)&nbsp;of any request by the Commission for any amendment to the Registration Statement or any amendment or supplement to the Prospectus or the receipt of any
comments from the Commission relating to the Registration Statement or any other request by the Commission for any additional information; (iv)&nbsp;of the issuance by the Commission of any order suspending the effectiveness of the Registration
Statement or preventing or suspending the use of any Preliminary Prospectus, any of the General Disclosure Package or the Prospectus or the initiation or threatening of any proceeding for that purpose or pursuant to Section&nbsp;8A of the Securities
Act; (v)&nbsp;of the occurrence of any event within the Prospectus Delivery Period as a result of which the Prospectus, the General Disclosure Package or any Issuer Free Writing Prospectus as then amended or supplemented would include any untrue
statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing when the Prospectus, the General Disclosure Package or any such Issuer Free Writing
Prospectus is delivered to a purchaser, not misleading; (vi)&nbsp;of the receipt by the Company of any notice of objection of the Commission to the use of the Registration Statement or any post-effective amendment thereto pursuant to Rule 401(g)(1)
under the Securities Act; and (vii)&nbsp;of the receipt by the Company of any notice with respect to any suspension of the qualification of the Shares for offer and sale in any jurisdiction or the initiation or threatening of any proceeding for such
purpose; and the Company will use its best efforts to prevent the issuance of any such order suspending the effectiveness of the Registration Statement, preventing or suspending the use of any Preliminary Prospectus, any of the General Disclosure
Package or the Prospectus or suspending any such qualification of the Shares and, if any such order is issued, will obtain as soon as possible the withdrawal thereof. </FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(e) <I>Ongoing Compliance.</I> (1)&nbsp;If during the Prospectus Delivery Period (i)&nbsp;any event shall occur or condition
shall exist as a result of which the Prospectus as then amended or supplemented would include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the
circumstances existing when the Prospectus is delivered to a purchaser, not misleading, or (ii)&nbsp;it is necessary to amend or supplement the Prospectus to comply with law, the Company will immediately notify the Underwriter thereof and forthwith
prepare and, subject to paragraph (c)&nbsp;above, file with the Commission and furnish to the Underwriter and to such dealers as the Underwriter may designate such amendments or supplements to the
</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">
Prospectus as may be necessary so that the statements in the Prospectus as so amended or supplemented will not, in the light of the circumstances existing when the Prospectus is delivered to a
purchaser, be misleading or so that the Prospectus will comply with law, and (2)&nbsp;if at any time prior to the Closing Date (i)&nbsp;any event shall occur or condition shall exist as a result of which the General Disclosure Package as then
amended or supplemented would include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances existing when the General Disclosure Package is
delivered to a purchaser, not misleading or (ii)&nbsp;it is necessary to amend or supplement the General Disclosure Package to comply with law, the Company will immediately notify the Underwriter thereof and forthwith prepare and, subject to
paragraph (c)&nbsp;above, file with the Commission (to the extent required) and furnish to the Underwriter and to such dealers as the Underwriter may designate such amendments or supplements to the General Disclosure Package as may be necessary so
that the statements in the General Disclosure Package as so amended or supplemented will not, in the light of the circumstances existing when the General Disclosure Package is delivered to a purchaser, be misleading or so that the General Disclosure
Package will comply with law. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(f) <I>Blue Sky Compliance.</I> The Company will qualify the Shares for offer
and sale under the securities or Blue Sky laws of such jurisdictions as the Underwriter shall reasonably request and will continue such qualifications in effect so long as required for distribution of the Shares; <U>provided</U> that the Company
shall not be required to (i)&nbsp;qualify as a foreign corporation or other entity or as a dealer in securities in any such jurisdiction where it would not otherwise be required to so qualify, (ii)&nbsp;file any general consent to service of process
in any such jurisdiction, or (iii)&nbsp;subject itself to taxation in any such jurisdiction if it is not otherwise so subject. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">(g) <I>Earnings Statement. </I>The Company will make generally available to its security holders and the Underwriter as soon as practicable an earnings statement that satisfies the provisions of
Section&nbsp;11(a) of the Securities Act and Rule 158 of the Commission promulgated thereunder covering a period of at least twelve months beginning with the first fiscal quarter of the Company occurring after the &#147;effective date&#148; (as
defined in Rule 158) of the Registration Statement. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(h) <I>Clear Market.</I> For a period of 90 days after the
date of the Prospectus, the Company will not (i)&nbsp;offer, pledge, announce the intention to sell, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to
purchase or otherwise transfer or dispose of, directly or indirectly, or file with the Commission a registration statement under the Securities Act relating to, any shares of Stock or any securities convertible into or exercisable or exchangeable
for Stock, or publicly disclose the intention to make any offer, sale, pledge, disposition or filing, or (ii)&nbsp;enter into any swap or other agreement that transfers, in whole or in part, any of the economic consequences of ownership of the Stock
or any such other securities, whether any such transaction described in clause (i)&nbsp;or (ii)&nbsp;above is to be settled by delivery of Stock or such other securities, in cash or otherwise, without the prior written consent of the Underwriter,
other than the Shares to be sold hereunder and any shares of Stock of the Company issued upon the exercise of options granted under Company Stock Plans or any warrants issued by the Company. </FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(i) <I>Use of Proceeds.</I> The Company will apply the net proceeds from the sale of the Shares as described in the
Registration Statement, the General Disclosure Package and the Prospectus under the heading &#147;Use of Proceeds.&#148; </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">(j) <I>No Stabilization.</I> The Company will not take, directly or indirectly, any action designed to or that could reasonably be expected to cause or result in any stabilization or manipulation of the
price of the Stock. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(k) <I>Exchange Listing. </I>The Company will use its best efforts to effect
the listing of, subject to notice of issuance, the Shares on the Nasdaq Global Market (the &#147;Exchange&#148;) by the Closing Date and commercially reasonable efforts to maintain such listing for 180 days following the Closing Date. </FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(l) <I>Reports.</I> So long as the Shares are outstanding, the Company will furnish to the Underwriter, as soon as they are
available, copies of all reports or other communications (financial or other) furnished to holders of the Shares, and copies of any reports and financial statements furnished to or filed with the Commission or any national securities exchange or
automatic quotation system; <U>provided</U> the Company will be deemed to have furnished such reports and financial statements to the Underwriter to the extent they are filed on the Commission&#146;s Electronic Data Gathering, Analysis, and
Retrieval system. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(m) <I>Record Retention</I>. The Company will, pursuant to reasonable procedures developed
in good faith, retain copies of each Issuer Free Writing Prospectus that is not filed with the Commission in accordance with Rule 433 under the Securities Act. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">5. <U>Certain Agreements of the Underwriters</U>. The Underwriter hereby represents and agrees that: </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">(a) It has not used, authorized use of, referred to or participated in the planning for use of, and will not use, authorize use of, refer to or participate in the planning for use of, any &#147;free
writing prospectus&#148;, as defined in Rule 405 under the Securities Act (which term includes use of any written information furnished to the Commission by the Company and not incorporated by reference into the Registration Statement and any press
release issued by the Company) other than (i)&nbsp;a free writing prospectus that contains no &#147;issuer information&#148; (as defined in Rule 433(h)(2) under the Securities Act) that was not included (including through incorporation by reference)
in the Preliminary Prospectus or a previously filed Issuer Free Writing Prospectus, (ii)&nbsp;any Issuer Free Writing Prospectus prepared pursuant to Section&nbsp;3(c) or Section&nbsp;4(c) above (including any electronic road show), or
(iii)&nbsp;any free writing prospectus prepared by the Underwriter and approved by the Company in advance in writing (each such free writing prospectus referred to in clauses (i)&nbsp;or (iii), an &#147;Underwriter Free Writing Prospectus&#148;).
</FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(b) It has not and will not, without the prior written consent of the Company, use any free writing prospectus
that contains the final terms of the Shares unless such terms have previously been included in a free writing prospectus filed with the Commission. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">(c) It is not subject to any pending proceeding under Section&nbsp;8A of the Securities Act with respect to the offering (and will promptly notify the Company if any such proceeding against it is
initiated during the Prospectus Delivery Period). </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">6. <U>Conditions of Underwriter&#146;s Obligations.</U> The obligation of
the Underwriter to purchase the Underwritten Shares on the Closing Date or the Option Shares on the Additional Closing Date, as the case may be, as provided herein is subject to the performance by the Company of its covenants and other obligations
hereunder and to the following additional conditions: </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(a) <I>Registration Compliance; No Stop Order.</I> No
order suspending the effectiveness of the Registration Statement shall be in effect, and no proceeding for such purpose, pursuant to Rule 401(g)(1) or pursuant to Section&nbsp;8A under the Securities Act shall be pending before or threatened by the
Commission; the Prospectus and each Issuer Free Writing Prospectus shall have been timely filed with the Commission under the Securities Act (in the case of an Issuer Free Writing Prospectus, to the extent required by Rule 433 under the Securities
Act) and in accordance with Section&nbsp;4(a) hereof; and all requests by the Commission for additional information shall have been complied with to the reasonable satisfaction of the Underwriter. </FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(b) <I>Representations and Warranties.</I> The representations and
warranties of the Company contained herein shall be true and correct on the date hereof and on and as of the Closing Date or the Additional Closing Date, as the case may be; and the statements of the Company and its officers made in any certificates
delivered pursuant to this Agreement shall be true and correct on and as of the Closing Date or the Additional Closing Date, as the case may be. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">(c) <I>No Material Adverse Change.</I> No event or condition of a type described in Section&nbsp;3(g) hereof shall have occurred or shall exist, which event or condition is not described in the General
Disclosure Package (excluding any amendment or supplement thereto) and the Prospectus (excluding any amendment or supplement thereto) and the effect of which in the judgment of the Underwriter makes it impracticable or inadvisable to proceed with
the offering, sale or delivery of the Shares on the Closing Date or the Additional Closing Date, as the case may be, on the terms and in the manner contemplated by this Agreement, the General Disclosure Package and the Prospectus. </FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(d) <I>Officer&#146;s Certificate.</I> The Underwriter shall have received on and as of the Closing Date or the Additional
Closing Date, as the case may be, a certificate of the chief financial officer or chief accounting officer of the Company and one additional senior executive officer of the Company who is satisfactory to the Underwriter (i)&nbsp;confirming that such
officers have carefully reviewed the Registration Statement, the General Disclosure Package and the Prospectus and, to the knowledge of such officers, the representations set forth in Sections 3(b) and 3(d) hereof are true and correct,
(ii)&nbsp;confirming that the other representations and warranties of the Company in this Agreement are true and correct and that the Company has complied with all agreements and satisfied all conditions on its part to be performed or satisfied
hereunder at or prior to the Closing Date or the Additional Closing Date, as the case may be, and (iii)&nbsp;to the effect set forth in paragraphs (a)&nbsp;and (d)&nbsp;above. </FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(e) <I>Comfort Letters.</I> On the date of this Agreement and on the Closing Date or the Additional Closing Date, as the case
may be, BDO Seidman, LLP and Crowe Horwath LLP shall have furnished to the Underwriter, at the request of the Company, letters, dated the respective dates of delivery thereof and addressed to the Underwriter, in form and substance reasonably
satisfactory to the Underwriter, containing statements and information of the type customarily included in accountants&#146; &#147;comfort letters&#148; to underwriters with respect to the financial statements and certain financial information
contained or incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus; <U>provided</U>, that the letter delivered on the Closing Date or the Additional Closing Date, as the case may be, shall use a
&#147;cut-off&#148; date no more than three business days prior to such Closing Date or such Additional Closing Date, as the case may be. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">(f) <I>Opinion and 10b-5 Statement of Counsel for the Company.</I> Bracewell&nbsp;&amp; Giuliani LLP, counsel for the Company, shall have furnished to the Underwriter, at the request of the Company, their
written opinion and 10b-5 statement, dated the Closing Date or the Additional Closing Date, as the case may be, and addressed to the Underwriter, in form and substance reasonably satisfactory to the Underwriter. </FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(g) <I>Opinion and 10b-5 Statement of Counsel for the Underwriter.</I> The Underwriter shall have received on and as of the
Closing Date or the Additional Closing Date, as the case may be, an opinion and 10b-5 statement of Alston&nbsp;&amp; Bird LLP, counsel for the Underwriter, with respect to such matters as the Underwriter may reasonably request, and such counsel
shall have received such documents and information as they may reasonably request to enable them to pass upon such matters. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(h) <I>No Legal Impediment to Issuance.</I> No action shall have been taken
and no statute, rule, regulation or order shall have been enacted, adopted or issued by any federal, state or foreign governmental or regulatory authority that would, as of the Closing Date or the Additional Closing Date, as the case may be, prevent
the issuance or sale of the Shares; and no injunction or order of any federal, state or foreign court shall have been issued that would, as of the Closing Date or the Additional Closing Date, as the case may be, prevent the issuance or sale of the
Shares. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(i) <I>Good Standing</I>. The Underwriter shall have received on and as of the Closing Date or the
Additional Closing Date, as the case may be, satisfactory evidence of the good standing of the Company and its subsidiary in their respective jurisdictions of organization and their good standing as foreign entities in such other jurisdictions as
the Underwriter may reasonably request, in each case in writing or any standard form of telecommunication from the appropriate governmental authorities of such jurisdictions. </FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(j) <I>Exchange Listing</I>. The Shares to be delivered on the Closing Date or Additional Closing Date, as the case may be,
shall have been approved for listing on the Exchange, subject to official notice of issuance. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(k) <I>Lock-up
Agreements</I>. The &#147;lock-up&#148; agreements, each substantially in the form of Exhibit A hereto, from certain officers and directors of the Company relating to sales and certain other dispositions of shares of Stock or certain other
securities, delivered to you on or before the date hereof, shall be in full force and effect on the Closing Date or Additional Closing Date, as the case may be. </FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(l) <I>Additional Documents</I>. On or prior to the Closing Date or the Additional Closing Date, as the case may be, the
Company shall have furnished to the Underwriter such further certificates and documents as the Underwriter may reasonably request. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman"
SIZE="2">All opinions, letters, certificates and evidence mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof only if they are in form and substance reasonably satisfactory to counsel for the
Underwriter. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">7. <U>Indemnification and Contribution</U>. </FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(a) <I>Indemnification of the Underwriter</I>. The Company agrees to indemnify and hold harmless the Underwriter, its
affiliates, directors and officers and each person, if any, who controls the Underwriter within the meaning of Section&nbsp;15 of the Securities Act or Section&nbsp;20 of the Exchange Act, from and against any and all losses, claims, damages and
liabilities (including, without limitation, legal fees and other expenses incurred in connection with any suit, action or proceeding or any claim asserted, as such fees and expenses are incurred), joint or several, that arise out of, or are based
upon, (i)&nbsp;any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or caused by any omission or alleged omission to state therein a material fact required to be stated therein or necessary in
order to make the statements therein, not misleading, (ii)&nbsp;any untrue statement or alleged untrue statement of a material fact contained in the Prospectus (or any amendment or supplement thereto), any Issuer Free Writing Prospectus, any
&#147;issuer information&#148; filed or required to be filed pursuant to Rule 433(d) under the Securities Act or any General Disclosure Package (including any General Disclosure Package that has subsequently been amended), or caused by any omission
or alleged omission to state therein a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading, or (iii)&nbsp;any untrue statement or alleged untrue statement of a
material fact contained in the Prospectus (or any amendment or supplement thereto) or prospectus wrapper material distributed in connection with the reservation and sale of the Directed Shares or the omission or alleged omission therefrom of a
material fact
</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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necessary to make the statements therein, when considered in conjunction with the Prospectus or the General Disclosure Package, not misleading, in each case except insofar as such losses, claims,
damages or liabilities arise out of, or are based upon, any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with any information relating to the Underwriter furnished to the Company in
writing by the Underwriter expressly for use therein, it being understood and agreed that the only such information furnished by the Underwriter consists of the information described as such in subsection (b)&nbsp;below. </FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(b) <I>Indemnification of the Company.</I> The Underwriter agrees to indemnify and hold harmless the Company, its directors,
its officers who signed the Registration Statement and each person, if any, who controls the Company within the meaning of Section&nbsp;15 of the Securities Act or Section&nbsp;20 of the Exchange Act to the same extent as the indemnity set forth in
paragraph (a)&nbsp;above, but only with respect to any losses, claims, damages or liabilities that arise out of, or are based upon, any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with
any information relating to the Underwriter furnished to the Company in writing by the Underwriter expressly for use in the Registration Statement, the Prospectus (or any amendment or supplement thereto) or any Issuer Free Writing Prospectus or any
General Disclosure Package, it being understood and agreed upon that the only such information furnished by the Underwriter consists of the following information in the Prospectus furnished on behalf of the Underwriter: the information under the
subheadings &#147;Stabilization&#148; and &#147;Passive Market Making&#148; under the heading &#147;Underwriting.&#148; </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman"
SIZE="2">(c) <I>Notice and Procedures.</I> If any suit, action, proceeding (including any governmental or regulatory investigation), claim or demand shall be brought or asserted against any person in respect of which indemnification may be sought
pursuant to either paragraph (a)&nbsp;or (b)&nbsp;above, such person (the &#147;Indemnified Person&#148;) shall promptly notify the person against whom such indemnification may be sought (the &#147;Indemnifying Person&#148;) in writing;
<U>provided</U> that the failure to notify the Indemnifying Person shall not relieve it from any liability that it may have under paragraph (a)&nbsp;or (b)&nbsp;above except to the extent that it has been materially prejudiced (through the
forfeiture of substantive rights or defenses) by such failure; and <U>provided</U>, <U>further</U>, that the failure to notify the Indemnifying Person shall not relieve it from any liability that it may have to an Indemnified Person otherwise than
under paragraph (a)&nbsp;or (b)&nbsp;above. If any such proceeding shall be brought or asserted against an Indemnified Person and it shall have notified the Indemnifying Person thereof, the Indemnifying Person shall retain counsel reasonably
satisfactory to the Indemnified Person (who shall not, without the consent of the Indemnified Person, be counsel to the Indemnifying Person) to represent the Indemnified Person in such proceeding and shall pay the fees and expenses of such counsel
related to such proceeding, as incurred. In any such proceeding, any Indemnified Person shall have the right to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such Indemnified Person unless (i)&nbsp;the
Indemnifying Person and the Indemnified Person shall have mutually agreed to the contrary; (ii)&nbsp;the Indemnifying Person has failed within a reasonable time to retain counsel reasonably satisfactory to the Indemnified Person; (iii)&nbsp;the
Indemnified Person shall have reasonably concluded that there may be legal defenses available to it that are different from or in addition to those available to the Indemnifying Person; or (iv)&nbsp;the named parties in any such proceeding
(including any impleaded parties) include both the Indemnifying Person and the Indemnified Person and representation of both parties by the same counsel would be inappropriate due to actual or potential differing interest between them. It is
understood and agreed that the Indemnifying Person shall not, in connection with any proceeding or related proceedings in the same jurisdiction, be liable for the fees and expenses of more than one separate firm (in addition to any local counsel)
for all Indemnified Persons, and that all such fees and expenses shall be paid or reimbursed as they are incurred. Any such separate firm for the Underwriter, its affiliates, directors and officers and any control persons of the Underwriter shall be
designated in writing by FIG Partners, LLC and any such separate firm for the Company, its directors, its officers who signed the Registration Statement and any control persons of the Company shall be designated in
</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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writing by the Company. The Indemnifying Person shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a
final judgment for the plaintiff, the Indemnifying Person agrees to indemnify each Indemnified Person from and against any loss or liability by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an
Indemnified Person shall have requested that an Indemnifying Person reimburse the Indemnified Person for fees and expenses of counsel as contemplated by this paragraph, the Indemnifying Person shall be liable for any settlement of any proceeding
effected without its written consent if (i)&nbsp;such settlement is entered into more than 30 days after receipt by the Indemnifying Person of such request, and (ii)&nbsp;the Indemnifying Person shall not have reimbursed the Indemnified Person in
accordance with such request prior to the date of such settlement. No Indemnifying Person shall, without the written consent of the Indemnified Person, effect any settlement of any pending or threatened proceeding in respect of which any Indemnified
Person is or could have been a party and indemnification could have been sought hereunder by such Indemnified Person, unless such settlement (x)&nbsp;includes an unconditional release of such Indemnified Person, in form and substance reasonably
satisfactory to such Indemnified Person, from all liability on claims that are the subject matter of such proceeding, and (y)&nbsp;does not include any statement as to or any admission of fault, culpability or a failure to act by or on behalf of any
Indemnified Person. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(d) <I>Contribution.</I> If the indemnification provided for in paragraphs (a)&nbsp;and
(b)&nbsp;above is unavailable to an Indemnified Person or insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each Indemnifying Person under such paragraph, in lieu of indemnifying such Indemnified Person
thereunder, shall contribute to the amount paid or payable by such Indemnified Person as a result of such losses, claims, damages or liabilities (i)&nbsp;in such proportion as is appropriate to reflect the relative benefits received by the Company,
on the one hand, and the Underwriter on the other, from the offering of the Shares, or (ii)&nbsp;if the allocation provided by clause (i)&nbsp;is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i)&nbsp;but also the relative fault of the Company, on the one hand, and the Underwriter on the other, in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations. The relative benefits received by the Company, on the one hand, and the Underwriter on the other, shall be deemed to be in the same respective proportions as the net proceeds (before deducting
expenses) received by the Company from the sale of the Shares and the total underwriting discounts and commissions received by the Underwriter in connection therewith, in each case as set forth in the table on the cover of the Prospectus, bear to
the aggregate offering price of the Shares. The relative fault of the Company, on the one hand, and the Underwriter on the other, shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or by the Underwriter and the parties&#146; relative intent, knowledge, access to information and opportunity to correct or prevent such
statement or omission. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(e) <I>Sale of Directed Shares. </I>In connection with the offer and sale of Directed
Shares, the Company agrees promptly upon written notice, to indemnify and hold harmless the Underwriter and each person, if any, who controls the Underwriter within the meaning of Section&nbsp;15 of the Securities Act or Section&nbsp;20 of the
Exchange Act, and each affiliate of the Underwriter within the meaning of Rule 405 under the Securities Act from and against any and all losses, liabilities, claims, damages and expenses incurred by it as a result of (i)&nbsp;the violation of any
applicable laws or regulations of any foreign jurisdictions where Directed Shares have been offered or (ii)&nbsp;the failure of any Directed Share Purchaser, who has agreed to purchase Directed Shares, to pay for and accept delivery of the Directed
Shares. Under no circumstances will the Underwriter be liable to the Company or to any Directed Share Purchaser for any action taken or omitted to be taken in connection with the Directed Shares or any transaction effected with any Directed Share
Purchaser, except to the extent found in a final judgment by a court of competent jurisdiction (not subject to further appeal) to have resulted primarily and directly from the gross negligence or willful misconduct of the Underwriter. </FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(f) <I>Limitation on Liability.</I> The Company and the Underwriter agree
that it would not be just and equitable if contribution pursuant to this Section&nbsp;7 were determined by <U>pro rata</U> allocation or by any other method of allocation that does not take account of the equitable considerations referred to in
paragraph (d)&nbsp;above. The amount paid or payable by an Indemnified Person as a result of the losses, claims, damages and liabilities referred to in paragraph (d)&nbsp;above shall be deemed to include, subject to the limitations set forth above,
any legal or other expenses incurred by such Indemnified Person in connection with any such action or claim. Notwithstanding the provisions of this Section&nbsp;7, in no event shall the Underwriter be required to contribute any amount in excess of
the amount by which the total underwriting discounts and commissions received by the Underwriter with respect to the offering of the Shares exceeds the amount of any damages that the Underwriter has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section&nbsp;11(f) of the Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(g) <I>Non-Exclusive Remedies.</I> The remedies provided for in
this Section&nbsp;7 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any Indemnified Person at law or in equity. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">8. <U>Effectiveness of Agreement</U>. This Agreement shall become effective upon the execution and delivery hereof by the parties hereto. </FONT></P> <P
STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">9. <U>Termination</U>. This Agreement may be terminated in the absolute discretion of the Underwriter, by notice to the Company, if after
the execution and delivery of this Agreement and prior to the Closing Date or, in the case of the Option Shares, prior to the Additional Closing Date (i)&nbsp;trading generally shall have been suspended or materially limited on or by any of the New
York Stock Exchange, the American Stock Exchange, the Nasdaq Stock Market, the Chicago Board Options Exchange, the CME Group, Inc.; (ii)&nbsp;trading of any securities issued or guaranteed by the Company shall have been suspended on any exchange or
in any over-the-counter market; (iii)&nbsp;a general moratorium on commercial banking activities shall have been declared by federal or Commonwealth of Virginia authorities; or (iv)&nbsp;there shall have occurred any outbreak or escalation of
hostilities or any change in financial markets or any calamity or crisis, either within or outside the United States, that, in the judgment of the Underwriter, is material and adverse and makes it impracticable or inadvisable to proceed with the
offering, sale or delivery of the Shares on the Closing Date or the Additional Closing Date, as the case may be, on the terms and in the manner contemplated by this Agreement, the General Disclosure Package and the Prospectus. </FONT></P> <P
STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">10. <U>Payment of Expenses</U>. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">(a) Whether or not the transactions contemplated by this Agreement are consummated or this Agreement is terminated, the Company will pay or cause to be paid all costs and expenses incident to the
performance of its obligations hereunder, including without limitation, (i)&nbsp;the costs incident to the authorization, issuance, sale, preparation and delivery of the Shares and any taxes payable in that connection; (ii)&nbsp;the costs incident
to the preparation, printing and filing under the Securities Act of the Registration Statement, the Preliminary Prospectus, any Issuer Free Writing Prospectus, the General Disclosure Package and the Prospectus (including all exhibits, amendments and
supplements thereto) and the distribution thereof; (iii)&nbsp;the fees and expenses of the Company&#146;s counsel and independent accountants; (iv)&nbsp;the fees and expenses incurred in connection with the registration or qualification of the
Shares under the state or foreign securities or blue sky laws of such jurisdictions as the Underwriter may designate and the preparation, printing and distribution of a blue sky memorandum and any offering
</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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of Directed Shares outside of the United States (including the related fees and expenses of counsel for the Underwriter);&nbsp;(v) the cost of preparing stock certificates; (vi)&nbsp;the costs
and charges of any transfer agent and any registrar; (vii)&nbsp;all expenses and application fees incurred in connection with any filing with, and clearance of the offering by, FINRA; (viii)&nbsp;all expenses incurred by the Company in connection
with any &#147;road show&#148; presentation to potential investors; (ix)&nbsp;all expenses and application fees related to the listing of the Shares on the Exchange; and (x)&nbsp;all expenses related to the offering of Directed Shares. </FONT></P>
<P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(b) The Underwriter will bear its own legal, advertising, syndication, stabilization and out-of-pocket expenses;
<I>provided, however,</I> that the Company shall reimburse the Underwriter for up to $100,000 of costs and expenses borne by the Underwriter in connection with the offering, including, without limitation, those related to fees of outside legal
counsel, travel and out-of-pocket expenses. If (i)&nbsp;this Agreement is terminated pursuant to Section&nbsp;9, (ii)&nbsp;the Company for any reason fails to tender the Shares for delivery to the Underwriter, (iii)&nbsp;the Underwriter declines to
purchase the Shares for any reason permitted under this Agreement, or (iv)&nbsp;the transactions contemplated by this Agreement are not consummated before March&nbsp;31, 2010, the Company agrees to reimburse the Underwriter for all out-of-pocket
costs and expenses (including the fees and expenses of their counsel) incurred by the Underwriter in connection with this Agreement and the offering contemplated hereby up to an amount not to exceed $100,000. </FONT></P> <P
STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">11. <U>Persons Entitled to Benefit of Agreement</U>. This Agreement shall inure to the benefit of and be binding upon the parties hereto and
their respective successors and the officers and directors and any controlling persons referred to in Section&nbsp;7 hereof. Nothing in this Agreement is intended or shall be construed to give any other person any legal or equitable right, remedy or
claim under or in respect of this Agreement or any provision contained herein. No purchaser of Shares from the Underwriter shall be deemed to be a successor merely by reason of such purchase. </FONT></P> <P
STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">12. <U>Survival</U>. The respective indemnities, rights of contribution, representations, warranties and agreements of the Company and the
Underwriter contained in this Agreement or made by or on behalf of the Company or the Underwriter pursuant to this Agreement or any certificate delivered pursuant hereto shall survive the delivery of and payment for the Shares and shall remain in
full force and effect, regardless of any termination of this Agreement or any investigation made by or on behalf of the Company or the Underwriter. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">13. <U>Certain Defined Terms</U>. For purposes of this Agreement, (a)&nbsp;except where otherwise expressly provided, the term &#147;affiliate&#148; has the meaning set forth in Rule 405 under the
Securities Act; (b)&nbsp;the term &#147;business day&#148; means any day other than a day on which banks are permitted or required to be closed in New York City; and (c)&nbsp;the term &#147;subsidiary&#148; has the meaning set forth in Rule 405
under the Securities Act. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">14. <U>Miscellaneous</U>. </FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(a) <I>Notices</I>. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly
given if mailed or transmitted and confirmed by any standard form of telecommunication. Notices to the Underwriter shall be given to it at FIG Partners, LLC, 1175 Peachtree Street, N.E., 100 Colony Square Suite 2250, Atlanta, GA 30361 (fax:
(404)&nbsp;591-6004); Attention: Matthew Veneri. Notices to the Company shall be given to it at Southern National Bancorp of Virginia, Inc., 1002 Wisconsin Avenue, N.E., Washington, DC 20007 (fax: (202)&nbsp;464-1134); Attention: Georgia S. Derrico.
</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(b) <I>Governing Law.</I> This Agreement shall be governed by and construed
in accordance with the laws of the Commonwealth of Virginia applicable to agreements made and to be performed in such state. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">(c) <I>Counterparts.</I> This Agreement may be signed in counterparts (which may include counterparts delivered by any standard form of telecommunication), each of which shall be an original and all of
which together shall constitute one and the same instrument. </FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(d) <I>Amendments or Waivers.</I> No amendment or
waiver of any provision of this Agreement, nor any consent or approval to any departure therefrom, shall in any event be effective unless the same shall be in writing and signed by the parties hereto. </FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; margin-left:4%; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">(e) <I>Headings.</I> The headings herein are included for convenience of reference only and are not intended to be part of,
or to affect the meaning or interpretation of, this Agreement. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>[Signature page follows] </I></FONT></P> <P
STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
 <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">23 </FONT></P>


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 <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">If the foregoing is in accordance with your understanding, please indicate your acceptance
of this Agreement by signing in the space provided below. </FONT></P> <P STYLE="font-size:12px;margin-top:0px;margin-bottom:0px">&nbsp;</P><DIV ALIGN="right">
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="40%" BORDER="0">

<TR>
<TD WIDTH="6%"></TD>
<TD VALIGN="bottom" WIDTH="2%"></TD>
<TD WIDTH="92%"></TD></TR>
<TR>
<TD VALIGN="top" COLSPAN="3"><FONT STYLE="font-family:Times New Roman" SIZE="2">Very truly yours,</FONT></TD></TR>
<TR>
<TD HEIGHT="16" COLSPAN="3"></TD></TR>
<TR>
<TD VALIGN="top" COLSPAN="3"><FONT STYLE="font-family:Times New Roman" SIZE="2">SOUTHERN NATIONAL BANCORP OF VIRGINIA, INC.</FONT></TD></TR>
<TR>
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR>
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em"><FONT STYLE="font-family:Times New Roman" SIZE="2">By:</FONT></P></TD>
<TD VALIGN="bottom" STYLE="BORDER-BOTTOM:1px solid #000000"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="top" STYLE="BORDER-BOTTOM:1px solid #000000"><FONT STYLE="font-family:Times New Roman" SIZE="2">/s/ Georgia S. Derrico</FONT></TD></TR>
<TR>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2">Name: Georgia S. Derrico</FONT></TD></TR>
<TR>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2">Title: CEO</FONT></TD></TR>
</TABLE></DIV> <P STYLE="margin-top:12px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Accepted: October&nbsp;29, 2009 </FONT></P> <P
STYLE="font-size:12px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" WIDTH="40%" BORDER="0">

<TR>
<TD WIDTH="7%"></TD>
<TD VALIGN="bottom" WIDTH="1%"></TD>
<TD WIDTH="92%"></TD></TR>
<TR>
<TD VALIGN="top" COLSPAN="3"><FONT STYLE="font-family:Times New Roman" SIZE="2">FIG PARTNERS, LLC</FONT></TD></TR>
<TR>
<TD HEIGHT="16"></TD>
<TD HEIGHT="16" COLSPAN="2"></TD></TR>
<TR>
<TD VALIGN="top"> <P STYLE="margin-left:1.00em; text-indent:-1.00em"><FONT STYLE="font-family:Times New Roman" SIZE="2">By:</FONT></P></TD>
<TD VALIGN="bottom" STYLE="BORDER-BOTTOM:1px solid #000000"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="top" STYLE="BORDER-BOTTOM:1px solid #000000"><FONT STYLE="font-family:Times New Roman" SIZE="2">/s/ Matthew F.X. Veneri</FONT></TD></TR>
<TR>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2">Name: Matthew F.X. Veneri</FONT></TD></TR>
<TR>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2">Title: an officer of the company</FONT></TD></TR>
</TABLE> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
 <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">24 </FONT></P>


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 <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="right"><FONT STYLE="font-family:Times New Roman" SIZE="2">Exhibit A </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px" ALIGN="center"><FONT
STYLE="font-family:Times New Roman" SIZE="2">LOCK-UP AGREEMENT </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px" ALIGN="right"><FONT STYLE="font-family:Times New Roman" SIZE="2">October <U>&nbsp;&nbsp;&nbsp;&nbsp;</U>, 2009 </FONT></P> <P
STYLE="margin-top:12px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">FIG Partners, LLC </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">1175 Peachtree Street NE
</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">100 Colony Square </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Suite 2250
</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Atlanta, Georgia 30361 </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman"
SIZE="2">Re: Southern National Bancorp of Virginia, Inc. &#151; Public Offering </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2">Ladies and Gentlemen: </FONT></P> <P
STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">The undersigned understands that you, as the Underwriter (the &#147;Underwriter&#148;), propose to enter into an Underwriting Agreement (the
&#147;Underwriting Agreement&#148;) with Southern National Bancorp of Virginia, Inc., a Virginia corporation (the &#147;Company&#148;), providing for the public offering (the &#147;Public Offering&#148;) by the Underwriter of shares of common stock
of the Company, par value $0.01 per share (the &#147;Common Stock&#148;). Capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Underwriting Agreement. </FONT></P> <P
STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">In consideration of the Underwriter&#146;s agreement to purchase and make the Public Offering of the Common Stock, and for other good and
valuable consideration receipt of which is hereby acknowledged, the undersigned hereby agrees that, without the prior written consent of FIG Partners, LLC, the undersigned will not, during the period ending 90 days after the date of the prospectus
relating to the Public Offering (the &#147;Prospectus&#148;), sell, offer, agree to sell, contract to sell, hypothecate, pledge, grant any option to sell, make any short sale or otherwise dispose of or hedge, directly or indirectly, any shares of
Common Stock or securities convertible into, exchangeable or exercisable for any shares of Common Stock or warrants or other rights to purchase shares of Common Stock or other similar securities. These restrictions are expressly agreed to preclude
the undersigned from engaging in any hedging or other transactions or arrangement that is designed to, or which reasonably could be expected to, lead to or result in a sale, disposition or transfer, in whole or in part, of any of the economic
consequences of ownership of the Common Stock, whether such transaction would be settled by delivery of Common Stock or other securities, in cash or otherwise. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">Notwithstanding the foregoing, the undersigned may transfer shares of the undersigned&#146;s Common Stock (i)&nbsp;as a <I>bona fide</I> gift or gifts where the donee or donees agree to be bound in
writing by the restrictions set forth herein, or (ii)&nbsp;to any trust or family limited partnership for the direct or indirect benefit of such shareholder or the immediate family of the shareholder, provided that the trustee of the trust or
general partner of the family limited partnership, as the case may be, agrees to be bound in writing by the restrictions set forth herein and that the transfer does not involve a disposition for value. </FONT></P>

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 <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">The 90-day restricted period described above will be automatically extended if
(1)&nbsp;during the period that begins on the date that is 15 calendar days plus 3 business days before the last day of the 90-day restricted period and ends on the last day of the 90-day restricted period, the Company issues an earnings release or
material news or a material event relating to the Company occurs or (2)&nbsp;prior to the expiration of the 90-day restricted period, the Company announces that it will release earnings results or becomes aware that material news or a material event
will occur during the 16-day period beginning on the last day of the 90-day restricted period, in which case the restricted period will continue to apply until the expiration of the date that is 17 calendar days after the date on which the earnings
release is issued or the material news or material event related to the Company occurs. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">In furtherance of the foregoing, the
Company and any duly appointed transfer agent for the registration or transfer of the securities described herein are hereby authorized to decline to make any transfer of securities if such transfer would constitute a violation or breach of this
Letter Agreement. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">The undersigned hereby represents and warrants that the undersigned has full power and authority to enter
into this Letter Agreement. All authority herein conferred or agreed to be conferred and any obligations of the undersigned shall be binding upon the successors, assigns, heirs or personal representatives of the undersigned. </FONT></P> <P
STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">The undersigned understands that, if the Underwriting Agreement does not become effective, or if the Underwriting Agreement (other than the
provisions thereof which survive termination) shall terminate or be terminated prior to payment for and delivery of the Common Stock to be sold thereunder, the undersigned shall be released from, all obligations under this Letter Agreement. The
undersigned understands that the Underwriter is entering into the Underwriting Agreement and proceeding with the Public Offering in reliance upon this Letter Agreement. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">This Letter Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Virginia, without regard to the conflict of laws principles thereof. </FONT></P> <P
STYLE="margin-top:12px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">[Signature page follows] </FONT></P>

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<TD VALIGN="top"><FONT STYLE="font-family:Times New Roman" SIZE="2">Very truly yours,</FONT></TD></TR>
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<TD VALIGN="bottom"><FONT STYLE="font-family:Times New Roman" SIZE="2">Name</FONT></TD></TR>
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<TYPE>EX-99.1
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<DESCRIPTION>RISK FACTORS
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 <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="right"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B>Exhibit 99.1 </B></FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px"
ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><A NAME="rom57760_2"></A>RISK FACTORS </B></FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2"><I>An
investment in our common stock involves risks. The following is a description of the material risks and uncertainties that we believe affect our business and an investment in our common stock. Additional risks and uncertainties that we are unaware
of, or that we currently deem immaterial, also may become important factors that affect us and our business. If any of the risks described were to occur, our financial condition, results of operations and cash flows could be materially and adversely
affected. If this were to happen, the trading price of our common stock could decline significantly and you could lose all or part of your investment. </I></FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT
STYLE="font-family:Times New Roman" SIZE="2"><B>Risks Associated With Our Business </B></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>We have a limited operating history, which makes
it difficult to predict future prospects and financial performance. </I></B></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">We have only been operating as a bank holding
company since April of 2005. Due to this limited operating history, it may be difficult to evaluate our business prospects and future financial performance. There can be no assurance that we can maintain our profitability. Further, our future
operating results depend upon a number of factors, including our ability to manage our growth, retain our customer base and to successfully identify and respond to emerging trends in our market areas. </FONT></P> <P
STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>Difficult market conditions and economic trends have adversely affected the banking industry and could adversely affect our business, financial
condition and results of operations. </I></B></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">We are operating in a challenging and uncertain economic environment, including
generally uncertain conditions nationally and locally in our markets. Financial institutions continue to be affected by declines in the real estate market that have negatively impacted the credit performance of mortgage, construction and commercial
real estate loans and resulted in significant write-downs of assets by many financial institutions. Concerns over the stability of the financial markets and the economy have resulted in decreased lending by financial institutions to their customers
and to each other. We retain direct exposure to the residential and commercial real estate markets, and we are affected by these events. Continued declines in real estate values, home sales volumes and financial stress on borrowers as a result of
the uncertain economic environment, including job losses, could have an adverse affect on our borrowers and/or their customers, which could adversely affect our business, financial condition and results of operations. </FONT></P> <P
STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Our ability to assess the creditworthiness of customers and to estimate the losses inherent in our credit portfolio is made more complex by
these difficult market and economic conditions. We also expect to face increased regulation and government oversight as a result of these downward trends. This increased government action may increase our costs and limit our ability to pursue
certain business opportunities. In addition, we may be required to pay even higher FDIC deposit insurance premiums than the recently increased level, because financial institution failures resulting from the depressed market conditions and other
factors have significantly depleted and may continue to deplete the Deposit Insurance Fund and reduce its ratio of reserves to insured deposits. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">A prolonged national economic recession or further deterioration of these conditions in our markets could drive losses beyond that which is provided for in our allowance for loan losses and result in the
following consequences: </FONT></P> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">increases in loan delinquencies; </FONT></P></TD></TR></TABLE> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">increases in nonperforming assets and foreclosures; </FONT></P></TD></TR></TABLE> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">decreases in demand for our products and services, which could adversely affect our liquidity position; and </FONT></P></TD></TR></TABLE> <P
STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="1%" VALIGN="top"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">decreases in the value of the collateral securing our loans, especially real estate, which could reduce customers&#146; borrowing power.
</FONT></P></TD></TR></TABLE> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
 <P STYLE="margin-top:0px;margin-bottom:0px" ALIGN="center"><FONT STYLE="font-family:Times New Roman" SIZE="2">1 </FONT></P>


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 <P STYLE="margin-top:0px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">We do not believe these difficult conditions are likely to improve in the near future. A
worsening of these conditions would likely exacerbate the adverse effects of these difficult economic conditions on us, our customers and the other financial institutions in our market. As a result, we may experience increases in foreclosures,
delinquencies and customer bankruptcies, as well as more restricted access to funds. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">The U.S Treasury and the FDIC have
initiated programs to address economic stabilization, yet the efficacy of these programs in stabilizing the economy and the banking system at large are uncertain. </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT
STYLE="font-family:Times New Roman" SIZE="2"><B><I>Current levels of market volatility are unprecedented and could adversely impact our business, results of operations and financial condition and our access to capital. </I></B></FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">The capital and credit markets have been experiencing volatility and disruption for more than a year. In some cases, the markets have
produced downward pressure on stock prices and credit availability for certain issuers without regard to those issuers&#146; underlying financial condition or performance. If the current levels of market disruption and volatility continue or worsen,
we may experience adverse effects, which may be material, on our customers&#146; and our ability to access capital and on our business, financial condition and results of operations. </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT
STYLE="font-family:Times New Roman" SIZE="2"><B><I>Liquidity risk could impair our ability to fund operations and jeopardize our financial condition, results of operations and cash flows. </I></B></FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Liquidity is essential to our business. Our ability to implement our business strategy will depend on our ability to obtain funding for loan
originations, working capital, possible acquisitions and other general corporate purposes. An inability to raise funds through deposits, borrowings, securities sold under repurchase agreements, the sale of loans and other sources could have a
substantial negative effect on our liquidity. We do not anticipate that our retail and commercial deposits will be sufficient to meet our funding needs in the foreseeable future. We therefore rely on deposits obtained through intermediaries, FHLB
advances, securities sold under agreements to repurchase and other wholesale funding sources to obtain the funds necessary to implement our growth strategy. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">Our access to funding sources in amounts adequate to finance our activities or on terms which are acceptable to us could be impaired by factors that affect us specifically or the financial services
industry or economy in general, including a decrease in the level of our business activity as a result of a downturn in the markets in which our loans are concentrated or adverse regulatory action against us. Our ability to borrow could also be
impaired by factors that are not specific to us, such as a disruption in the financial markets or negative views and expectations about the prospects for the financial services industry in light of the recent turmoil faced by banking organizations
and the continued deterioration in credit markets. To the extent we are not successful in obtaining such funding, we will be unable to implement our strategy as planned which could have a material adverse effect on our financial condition, results
of operations and cash flows. </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>Sonabank&#146;s reliance on brokered deposits could adversely affect its liquidity and results of
operations. </I></B></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Among other sources of funds,&nbsp;Sonabank relies on brokered deposits to provide funds with which to
make loans and provide for its other liquidity needs. Like many community banks, Sonabank&#146;s loan demand has exceeded the rate at which it has been able to increase its deposits, and, as a result, Sonabank has relied on brokered deposits as a
source of funds.&nbsp;As of June&nbsp;30, 2009, brokered deposits, which include brokered certificates of deposit and brokered money market deposits, amounted to $104.9 million, or approximately&nbsp;33.3% of total deposits, a decrease of $40.4
million, or 27.8%, compared with brokered certificates of deposit and brokered money market deposits of $145.3 million at December&nbsp;31, 2008.&nbsp;Generally, brokered deposits may not be as stable as other types of deposits, and, in the future,
those depositors may not renew their deposits when they mature, or&nbsp;Sonabank may have to pay a higher rate of interest to keep those deposits or to replace them with other deposits or with funds from other sources.&nbsp;Additionally, if Sonabank
ceases to be &#147;well capitalized&#148; for bank regulatory purposes,&nbsp;it&nbsp;will not&nbsp;be able&nbsp;to accept, renew or rollover brokered deposits without a waiver from
</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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the FDIC.&nbsp;As of June&nbsp;30, 2009, Sonabank is categorized as well-capitalized with total risk-based capital, Tier 1 risk-based capital and leverage ratios of 15.69%, 14.52% and 13.46%,
respectively. An inability to maintain or replace these brokered deposits as they mature could adversely affect&nbsp;Sonabank&#146;s liquidity.&nbsp;Further, paying higher&nbsp;interest rates to maintain or replace these deposits&nbsp;could
adversely affect&nbsp;Sonabank&#146;s net interest margin and its results of operations. </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>Declines in asset values may result in
impairment charges and adversely affect the value of our investments, financial performance and capital. </I></B></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">We maintain
an investment portfolio that includes, but is not limited to, collateralized mortgage obligations, agency mortgage-backed securities and pooled trust preferred securities. The market value of investments in our portfolio has become increasingly
volatile over the past two years. The market value of investments may be affected by factors other than the underlying performance of the issuer or composition of the bonds themselves, such as ratings downgrades, adverse changes in the business
climate and a lack of liquidity for resales of certain investment securities. We periodically, but not less than quarterly, evaluate investments and other assets for impairment indicators. We may be required to record additional impairment charges
if our investments suffer a decline in value that is considered other-than-temporary. For the six months ended June&nbsp;30, 2009 and the year ended December&nbsp;31, 2008, we incurred other-than-temporary impairment charges of $863,000 pre-tax on
three of our trust preferred securities holdings and $1.5 million pre-tax on our holding of Freddie Mac perpetual preferred stock, respectively. During the three months ended September&nbsp;30, 2009, we incurred an additional other-than-temporary
impairment charge of $1.2 million pre-tax on six of our trust preferred securities holdings. If in future periods we determine that a significant impairment has occurred, we would be required to charge against earnings the credit-related portion of
the other-than-temporary impairment, which could have a material adverse effect on our results of operations in the periods in which the write-offs occur. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">Our pooled trust preferred securities are particularly vulnerable to the performance of the issuer of the subordinated debentures that are collateral for the trust preferred securities. Deterioration of
these trust preferred securities can occur because of defaults by the issuer of the collateral or because of deferrals of dividend payments on the securities. Numerous financial institutions have failed and their parent bank holding companies have
filed for bankruptcy, which has led to defaults in the subordinated debentures that collateralize the trust preferred securities. Further, increased regulatory pressure has been placed on financial institutions to maintain capital ratios above the
required minimum to be well-capitalized, which often results in restrictions on dividends, and leads to deferrals of dividend payments on the trust preferred securities. More specifically, the Federal Reserve has stated that a bank holding company
should eliminate, defer or significantly reduce dividends if (i)&nbsp;its net income available to shareholders for the past four quarters, net of dividends paid, is not sufficient to fully fund the dividends, (ii)&nbsp;its prospective rate of
earnings retention is not consistent with its capital needs or (iii)&nbsp;it is in danger of not meeting its minimum regulatory capital adequacy ratios. In the second quarter of 2009, we incurred an aggregate other-than-temporary impairment charge
of $863,000 on three of the trust preferred securities we own and in the third quarter of 2009, we incurred an aggregate other-than-temporary impairment charge of $1.2 million pre-tax on six of the trust preferred securities we own. Additional
defaults in the underlying collateral or deferrals of dividend payments for these securities could lead to additional charges on these securities and/or other-than-temporary impairment charges on other trust preferred securities we own. </FONT></P>
<P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>The failure of other financial institutions could adversely affect us. </I></B></FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">In addition to the risk to our pooled trust preferred securities discussed above, our ability to engage in routine funding transactions could
be adversely affected by the actions and potential failures of other financial institutions. Financial institutions are interrelated as a result of trading, clearing, counterparty and other relationships. We have exposure to many different
industries and counterparties, and we routinely execute transactions with a variety of counterparties in the financial services industry. As a result, defaults by, or even rumors or concerns about, one or more financial institutions with whom we do
business, or the financial services industry generally, have led to market-wide liquidity problems and could lead to losses or defaults by us or by other institutions. Many of these transactions expose us to credit risk in the event of default of
our counterparty
</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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or client. In addition, our credit risk may be exacerbated when the collateral we hold cannot be sold at prices that are sufficient for us to recover the full amount of our exposure. Any such
losses could materially and adversely affect our financial condition and results of operations. </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>If the goodwill that we recorded in
connection with business acquisitions becomes impaired, it could have a negative impact on our profitability. </I></B></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Goodwill
represents the amount of acquisition cost over the fair value of net assets we acquired in the purchase of another entity. We review goodwill for impairment at least annually, or more frequently if events or changes in circumstances indicate the
carrying value of the asset might be impaired. Examples of those events or circumstances include the following: </FONT></P> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">significant adverse changes in business climate; </FONT></P></TD></TR></TABLE> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">significant changes in credit quality; </FONT></P></TD></TR></TABLE> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">significant unanticipated loss of customers; </FONT></P></TD></TR></TABLE> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">significant loss of deposits or loans; or </FONT></P></TD></TR></TABLE> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">significant reductions in profitability. </FONT></P></TD></TR></TABLE> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">We determine impairment by comparing the implied fair value of the reporting unit goodwill with the carrying amount of that goodwill. If the carrying amount of the reporting unit goodwill exceeds the
implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. Any such adjustments are reflected in our results of operations in the periods in which they become known. As of June&nbsp;30, 2009, our
goodwill totaled $8.7 million. While we have recorded no such impairment charges since we initially recorded the goodwill, there can be no assurance that our future evaluations of goodwill will not result in findings of impairment and related
write-downs, which may have a material adverse effect on our financial condition and results of operations. </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>A significant amount of our
loans are secured by real estate and the continued economic slowdown and depressed residential real estate market in our primary markets could be detrimental to our financial condition and results of operations. </I></B></FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Real estate lending (including commercial, construction, land development, and residential loans) is a large portion of our loan portfolio,
constituting $255.7 million, or approximately 78.4% of our total loan portfolio, as of June&nbsp;30, 2009. The residential and commercial real estate sectors of the U.S. economy experienced an economic slowdown that has continued in 2009.
Specifically, the values of residential and commercial real estate located in our market areas have declined, and these declines may continue in the future. If the loans that are collateralized by real estate become troubled during a time when
market conditions are declining or have declined, then we may not be able to realize the full value of the collateral that we anticipated at the time of originating the loan, which could require us to increase our provision for loan losses and
adversely affect our financial condition and results of operations. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Current market conditions include an over-supply of land,
lots, and finished homes in many markets, including those where we do business. As of June&nbsp;30, 2009, $80.2 million, or approximately 24.6% of our total loans, were secured by residential real estate. This includes $62.1 million in residential
1-4 family loans, $13.3 million in home equity lines of credit and $4.8 million in construction loans to residential builders. If housing markets in our market areas continue to deteriorate, we may experience a further increase in nonperforming
loans, provisions for loan losses and charge-offs. While it is difficult to predict how long these conditions will exist and which markets, products or other segments of our loan and securities portfolio might ultimately be affected, these factors
could adversely affect our ability to grow our earning assets or affect our results of operations. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>If the value of real estate in our market areas were to decline materially, a significant portion of
our loan portfolio could become under-collateralized, which could have a material adverse effect on our asset quality, capital structure and profitability. </I></B></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">As of June&nbsp;30, 2009, a significant portion of our loan portfolio was comprised of loans secured by either commercial real estate or single family homes which are under construction. In the majority
of these loans, real estate was the primary collateral component. In some cases, and out of an abundance of caution, we take real estate as security for a loan even when it is not the primary component of collateral. The real estate collateral that
provides the primary or an alternate source of repayment in the event of default may deteriorate in value during the term of the loan as a result of changes in economic conditions, fluctuations in interest rates and the availability of loans to
potential purchasers, changes in tax and other laws and acts of nature. If we are required to liquidate the collateral securing a loan to satisfy the debt during a period of reduced real estate values, which we have seen and continue to experience,
our earnings and capital could be adversely affected. We are subject to increased lending risks in the form of loan defaults as a result of the high concentration of real estate lending in our loan portfolio should the real estate market in Virginia
maintain its downward turn. A continued weakening of the real estate market in our primary market areas could have an adverse effect on the demand for new loans, the ability of borrowers to repay outstanding loans, the value of real estate and other
collateral securing the loans and the value of real estate owned by us. If real estate values decline further, it is also more likely that we would be required to increase our allowance for loan losses, which could adversely affect our financial
condition and results of operations. </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>We are subject to risks related to our concentration of construction and land development and
commercial real estate loans. </I></B></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">As of June&nbsp;30, 2009, we had $45.9 million of construction loans, of which $33.1
million were land development loans. Construction loans are subject to risks during the construction phase that are not present in standard residential real estate and commercial real estate loans. These risks include: </FONT></P> <P
STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">the viability of the contractor; </FONT></P></TD></TR></TABLE> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="1%" VALIGN="top"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">the value of the project being subject to successful completion; </FONT></P></TD></TR></TABLE> <P
STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TD WIDTH="1%" VALIGN="top"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">the contractor&#146;s ability to complete the project, to meet deadlines and time schedules and to stay within cost estimates;&nbsp;and
</FONT></P></TD></TR></TABLE> <P STYLE="font-size:6px;margin-top:0px;margin-bottom:0px">&nbsp;</P>
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<TR>
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<TD WIDTH="1%" VALIGN="top"><FONT SIZE="1">&nbsp;</FONT></TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left"><FONT STYLE="font-family:Times New Roman" SIZE="2">concentrations of such loans with a single contractor and its affiliates. </FONT></P></TD></TR></TABLE> <P
STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Real estate construction loans may involve the disbursement of substantial funds with repayment dependent, in part, on the success of the
ultimate project rather than the ability of a borrower or guarantor to repay the loan and also present risks of default in the event of declines in property values or volatility in the real estate market during the construction phase. Our practice,
in the majority of instances, is to secure the personal guaranty of individuals in support of our real estate construction loans which provides us with an additional source of repayment. As of June&nbsp;30, 2009, we had no nonperforming construction
and development loans and $3.4 million of assets that have been foreclosed. If one or more of our larger borrowers were to default on their construction and development loans, and we did not have alternative sources of repayment through personal
guarantees or other sources, or if any of the aforementioned risks were to occur, we could incur significant losses. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">As of
June&nbsp;30, 2009, we had $127.0 million of commercial real estate loans. Commercial real estate lending typically involves higher loan principal amounts and the repayment is dependent, in large part, on sufficient income from the properties
securing the loan to cover operating expenses and debt service. Federal bank regulatory authorities issued the Interagency Guidance on Concentrations in Commercial Real Estate Lending in December of 2006 to provide guidance regarding significant
concentrations of commercial real estate loans within bank loan portfolios. The FDIC reiterated this guidance in a letter to financial institutions dated March&nbsp;17, 2008 (FIL-22-2008) titled &#147;Managing Commercial Real Estate Concentrations
in a Challenging Environment&#148; to remind banks that their risk management practices and capital levels should be commensurate with the level and nature of their commercial real estate concentration risk. Banks with higher levels of commercial
real estate loans
</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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are expected to implement improved underwriting, internal controls, risk management policies and portfolio stress testing, as well as higher levels of allowances for loan losses and capital
levels as a result of commercial real estate lending growth and exposures. Sonabank&#146;s commercial real estate loans are below the thresholds identified as significant by the regulatory guidance. If there is deterioration in our commercial real
estate portfolio or if regulatory authorities conclude that we have not implemented appropriate risk management policies and practices, it could adversely affect our business and result in a requirement of increased capital levels, and such capital
may not be available at that time. </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>Changes to government guaranteed loan programs could affect our SBA business. </I></B></FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Sonabank relies on originating, purchasing, pooling and selling government guaranteed loans, in particular those guaranteed by the SBA. As of
June&nbsp;30, 2009, Sonabank had $37.3 million of SBA loans. Sonabank originated $6.5 million, $11.0 million and $19.8 million in SBA loans in the six months ended June&nbsp;30, 2009, and in fiscal 2008 and fiscal 2007, respectively. Sonabank sold
the guaranteed portions of its SBA loans in the secondary market in the third quarter of both 2008 and 2009 and intends to continue such sales, which are a source of non-interest income for Sonabank, when market conditions are favorable. We can
provide no assurance that Sonabank will be able to continue originating these loans, that it will be able to sell the loans in the secondary market or that it will continue to realize premiums upon any sale of SBA loans. </FONT></P> <P
STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">SBA lending is a federal government created and administered program. As such, legislative and regulatory developments can affect the
availability and funding of the program. This dependence on legislative funding and regulatory restrictions from time to time causes limitations and uncertainties with regard to the continued funding of such loans, with a resulting potential adverse
financial impact on our business. Currently, the maximum limit on individual 7(a) loans which the SBA will permit is $2.0 million. Any reduction in this level could adversely affect the volume of our business. In addition, the fees associated with
SBA loans are currently waived by the government and a decision to reinstate these fees would increase the cost of these loans to our customers. As of June&nbsp;30, 2009, our SBA business constitutes 11.4% of our total loans. The periodic
uncertainty of the SBA program relative to availability, amounts of funding and the waiver of associated fees creates greater risk for our business than do more stable aspects of our business. </FONT></P> <P
STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">The federal government presently guarantees 75% to 90% of the principal amount of each qualifying SBA loan under the 7(a) program. We can
provide no assurance that the federal government will maintain the SBA program, or if it does, that such guaranteed portion will remain at its current funding level. Furthermore, it is possible that Sonabank could lose its preferred lender status
which, subject to certain limitations, allows it to approve and fund SBA loans without the necessity of having the loan approved in advance by the SBA. It is also possible the federal government could reduce the amount of loans which it guarantees.
In addition, we are dependent on the expertise of our personnel who make SBA loans in order to continue to originate and service SBA loans. If we are unable to retain qualified employees in the future, or if there are climbs in interest rates in the
future, our income from the origination, sale and servicing of SBA loans could be substantially reduced. </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>Because we began operations in
2005, there is limited repayment history against which we can fully assess the adequacy of our allowance for loan losses. If our allowance for loan losses is not adequate to cover actual loan losses, our earnings will decrease. </I></B></FONT></P>
<P STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">There is limited repayment history against which we can fully assess the adequacy of our allowance for loan losses. Loans totaling $291.9
million, or 89.5%, of our loan portfolio as of June&nbsp;30, 2009 represents loans originated since mid 2005 and $34.4 million, or 10.5%, of our loan portfolio represents purchased loans. As a lender, we are exposed to the risk that our loan clients
may not repay their loans according to the terms of these loans, and the collateral securing the payment of these loans may be insufficient to assure repayment. We make various assumptions and judgments about the collectibility of our loan
portfolio, including the creditworthiness of the borrowers and the value of the real estate and other assets serving as collateral for the repayment of many of our loans. We maintain an allowance for loan losses to cover any probable incurred loan
losses in the loan
</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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portfolio. In determining the size of the allowance, we rely on a periodic analysis of our loan portfolio, our historical loss experience and our evaluation of general economic conditions. If our
assumptions prove to be incorrect or if we experience significant loan losses, our current allowance may not be sufficient to cover actual loan losses and adjustments may be necessary to allow for different economic conditions or adverse
developments in our loan portfolio. A material addition to the allowance for loan losses could cause our earnings to decrease. Due to the relatively unseasoned nature of our loan portfolio, we cannot assure you that we will not experience an
increase in delinquencies and losses as these loans continue to mature. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">In addition, federal regulators periodically review
our allowance for loan losses and may require us to increase our provision for loan losses or recognize further charge-offs, based on judgments different than those of our management. Any significant increase in our allowance for loan losses or
charge-offs required by these regulatory agencies could have a material adverse effect on our results of operations and financial condition. </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman"
SIZE="2"><B><I>Our business strategy includes strategic growth, and our financial condition and results of operations could be negatively affected if we fail to grow or fail to manage our growth effectively. </I></B></FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%;padding-bottom:3px;"><FONT STYLE="font-family:Times New Roman" SIZE="2">We completed the acquisition of a branch of Millennium Bank in Warrenton, Virginia on September&nbsp;28, 2009, the
acquisition of the Leesburg branch location from Founders Corporation which opened on February&nbsp;11, 2008, the acquisition of 1</FONT><FONT STYLE="font-family:Times New Roman" SIZE="1"><SUP
STYLE="vertical-align:baseline; position:relative; bottom:.8ex">st</SUP></FONT><FONT STYLE="font-family:Times New Roman" SIZE="2"> Service Bank in December of 2006 and the acquisition of the Clifton Forge branch of First Community Bancorp, Inc. in
December of 2005. We intend to continue pursuing a growth strategy for our business. Our prospects must be considered in light of the risks, expenses and difficulties frequently encountered by growing companies such as the continuing need for
infrastructure and personnel, the time and costs inherent in integrating a series of different operations and the ongoing expense of acquiring and staffing new banks or branches. We may not be able to expand our presence in our existing markets or
successfully enter new markets and any expansion could adversely affect our results of operations. Failure to manage our growth effectively could have a material adverse effect on our business, future prospects, financial condition or results of
operations, and could adversely affect our ability to successfully implement our business strategy. Our ability to grow successfully will depend on a variety of factors, including the continued availability of desirable business opportunities, the
competitive responses from other financial institutions in our market areas and our ability to manage our growth. There can be no assurance of success or the availability of branch or bank acquisitions in the future. </FONT></P> <P
STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>Future growth or operating results may require us to raise additional capital, but that capital may not be available or it may be dilutive. </I></B>
</FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">We and Sonabank are each required by the Federal Reserve to maintain adequate levels of capital to support our operations. In
the event that our future operating results erode capital, if Sonabank is required to maintain capital in excess of well-capitalized standards, or if we elect to expand through loan growth or acquisitions, we may be required to raise additional
capital. Our ability to raise capital will depend on conditions in the capital markets, which are outside our control, and on our financial performance. Accordingly, we cannot be assured of our ability to raise capital on favorable terms when
needed, or at all. If we cannot raise additional capital when needed, we will be subject to increased regulatory supervision and the imposition of restrictions on our growth and business. These outcomes could negatively impact our ability to operate
or further expand our operations through acquisitions or the establishment of additional branches and may result in increases in operating expenses and reductions in revenues that could have a material adverse effect on our financial condition and
results of operations. In addition, in order to raise additional capital, we may need to issue shares of our common stock that would dilute the book value of our common stock and reduce our current shareholders&#146; percentage ownership interest to
the extent they do not participate in future offerings. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>Our business is subject to interest rate risk and variations in interest rates may negatively affect
our financial performance. </I></B></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">The majority of our assets and liabilities are monetary in nature and subject us to
significant risk from changes in interest rates. Fluctuations in interest rates are not predictable or controllable. Like most financial institutions, changes in interest rates can impact our net interest income as well as the valuation of our
assets and liabilities, which is the difference between interest earned from interest-earning assets, such as loans and investment securities, and interest paid on interest-bearing liabilities, such as deposits and borrowings. We expect that we will
periodically experience &#147;gaps&#148; in the interest rate sensitivities of our assets and liabilities, meaning that either our interest-bearing liabilities will be more sensitive to changes in market interest rates than our interest-earning
assets, or vice versa. In either event, if market interest rates should move contrary to our position, this &#147;gap&#148; will negatively impact our earnings. Many factors impact interest rates, including governmental monetary policies, inflation,
recession, changes in unemployment, the money supply, and international disorder and instability in domestic and foreign financial markets. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">Based on our analysis of the interest rate sensitivity of our assets, an increase in the general level of interest rates may negatively affect the market value of the portfolio equity, but will positively
affect our net interest income since most of our assets have floating rates of interest that adjust fairly quickly to changes in market rates of interest. Additionally, an increase in interest rates may, among other things, reduce the demand for
loans and our ability to originate loans. A decrease in the general level of interest rates may affect us through, among other things, increased prepayments on our loan and mortgage-backed securities portfolios and increased competition for
deposits. Accordingly, changes in the level of market interest rates affect our net yield on interest-earning assets, loan origination volume, loan and mortgage-backed securities portfolios, and our overall results. Although our asset liability
management strategy is designed to control our risk from changes in market interest rates, it may not be able to prevent changes in interest rates from having a material adverse effect on our results of operations and financial condition.
</FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>We may be required to pay significantly higher FDIC deposit insurance premiums and assessments in the future. </I></B></FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Recent insured depository institution failures, as well as deterioration in banking and economic conditions, have significantly depleted the
FDIC&#146;s Deposit Insurance Fund, resulting in a decline in the ratio of reserves to insured deposits to historical lows. The FDIC anticipates that additional insured depository institutions are likely to fail in the foreseeable future so the
reserve ratio may continue to decline. In addition, the deposit insurance limit on FDIC deposit insurance coverage generally has increased to $250,000 through December&nbsp;31, 2013. These developments will cause the premiums assessed on us by the
FDIC to increase and materially increase our noninterest expense. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">On December&nbsp;16, 2008, the FDIC Board of Directors
determined deposit insurance assessment rates for the first quarter of 2009 at 12 to 14 basis points per $100 of deposits. Beginning April&nbsp;1, 2009, the rates increased to 12 to 16 basis points per $100 of deposits. Additionally, on May&nbsp;22,
2009, the FDIC announced a final rule imposing a special emergency assessment as of June&nbsp;30, 2009, payable September&nbsp;30, 2009, based on $0.05 for each $100 of assets, less Tier 1 capital, as of June&nbsp;30, 2009, but the amount of the
assessment is capped at 10 basis points of domestic deposits. We paid a special assessment of $190,000. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">On September&nbsp;29,
2009, the FDIC adopted a proposed rule that amends the final rule adopted on May&nbsp;22, 2009 to restore losses to its Deposit Insurance Fund. The proposed rule would require insured institutions to prepay on December&nbsp;30, 2009, estimated
quarterly risk-based assessments for the fourth quarter of 2009 and for all of 2010, 2011, and 2012. If the proposed rule is adopted, an institution&#146;s assessment will be calculated by taking the institution&#146;s actual September&nbsp;30, 2009
assessment and adjusting it quarterly by an estimated 5% annual growth rate through the end of 2012. Further, the FDIC will incorporate a uniform 3 basis point increase effective January&nbsp;1, 2011. The FDIC has indicated that each institution
would record the entire amount of its prepaid assessment as a prepaid expense, an asset on its balance sheet, as of December&nbsp;30, 2009. As of
</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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December&nbsp;31, 2009, and each quarter thereafter, each institution would record an expense, or a charge to earnings, for its quarterly assessment invoiced on its quarterly statement and an
offsetting credit to the prepaid assessment until the asset is exhausted. The federal banking agencies&#146; risk-based capital rules permit an institution to apply a 0% risk weight to all claims on U.S. Government agencies, and the FDIC has
indicated that the prepayment will qualify for such treatment. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">These higher FDIC assessment rates and special assessments
will have an adverse impact on our results of operations. Our FDIC insurance related costs were $487,000 for the six months ended June&nbsp;30, 2009 compared with $211,000 and $140,000 for the years ended December&nbsp;31, 2008 and 2007,
respectively. We are unable to predict the impact in future periods; including whether and when additional special assessments will occur, in the event the economic crisis continues. </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT
STYLE="font-family:Times New Roman" SIZE="2"><B><I>A loss of our executive officers could impair our relationship with our customers and adversely affect our business. </I></B></FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Many community banks attract customers based on the personal relationships that the banks&#146; officers and customers establish with each
other and the confidence that the customers have in the officers. As a relatively new enterprise, we depend on the performance of Ms.&nbsp;Georgia&nbsp;S. Derrico, chairman and chief executive officer, and R. Roderick Porter, president, of our
company and Sonabank. Ms.&nbsp;Derrico is a well-known banker in our market areas, having operated a successful financial institution there for more than 18 years prior to founding our company and Sonabank. We do not have an employment agreement
with either individual. The loss of the services of either of these officers or their failure to perform management functions in the manner anticipated by our board of directors could have a material adverse effect on our business. Our success will
be dependent upon the board&#146;s ability to attract and retain quality personnel, including these officers. We have attempted to reduce our risk by entering into a change in control agreement that includes a non-competition covenant with
Ms.&nbsp;Derrico and Mr.&nbsp;Porter. </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>Our profitability depends significantly on local economic conditions in the areas where our
operations and loans are concentrated. </I></B></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Our profitability depends on the general economic conditions in our market
areas of Northern Virginia, including Washington D.C., Charlottesville and Clifton Forge (Alleghany County) and the surrounding areas. Unlike larger banks that are more geographically diversified, we provide banking and financial services to clients
primarily in our market areas. As of June&nbsp;30, 2009, substantially all of our commercial real estate, real estate construction and residential real estate loans were made to borrowers in Virginia. The local economic conditions in this area have
a significant impact on our commercial, real estate and construction and consumer loans, the ability of the borrowers to repay these loans and the value of the collateral securing these loans. In addition, if the population or income growth in this
region slows, stops or declines, income levels, deposits and housing starts could be adversely affected and could result in the curtailment of our expansion, growth and profitability. Recently, economic conditions in Virginia have declined and if
this continues for a prolonged period of time, we would likely experience significant increases in nonperforming loans, which could lead to operating losses, impaired liquidity and eroding capital. </FONT></P> <P
STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Additionally, political conditions could impact our earnings. Acts or threats of war, terrorism, an outbreak of hostilities or other
international or domestic calamities, or other factors beyond our control could impact these local economic conditions and could negatively affect the financial results of our banking operations. </FONT></P> <P
STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>The properties that we own and our foreclosed real estate assets could subject us to environmental risks and associated costs. </I></B></FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">There is a risk that hazardous substances or wastes, contaminants, pollutants or other environmentally restricted substances could be
discovered on our properties or our foreclosed assets (particularly in the case of
</FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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real estate loans). In this event, we might be required to remove the substances from the affected properties or to engage in abatement procedures at our sole cost and expense. Besides being
liable under applicable federal and state statutes for our own conduct, we may also be held liable under certain circumstances for actions of borrowers or other third parties on property that collateralizes one or more of our loans or on property
that we own. Potential environmental liability could include the cost of remediation and also damages for any injuries caused to third-parties. We cannot assure you that the cost of removal or abatement will not substantially exceed the value of the
affected properties or the loans secured by those properties, that we would have adequate remedies against prior owners or other responsible parties or that we would be able to resell the affected properties either prior to or following completion
of any such removal or abatement procedures. If material environmental problems are discovered prior to foreclosure, we generally will not foreclose on the related collateral or will transfer ownership of the loan to a subsidiary. It should be
noted, however, that the transfer of the property or loans to a subsidiary may not protect us from environmental liability. Furthermore, despite these actions on our part, the value of the property as collateral will generally be substantially
reduced and, as a result, we may suffer a loss upon collection of the loan. </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>The small to medium-sized businesses we lend to may have
fewer resources to weather a downturn in the economy, which may impair a borrower&#146;s ability to repay a loan to us that could materially harm our operating results. </I></B></FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">We make loans to professional firms and privately owned businesses that are considered to be small to medium-sized businesses. Small to
medium-sized businesses frequently have smaller market shares than their competition, may be more vulnerable to economic downturns, often need substantial additional capital to expand or compete and may experience substantial volatility in operating
results, any of which may impair a borrower&#146;s ability to repay a loan. In addition, the success of a small and medium-sized business often depends on the management talents and efforts of one or two persons or a small group of persons, and the
death, disability or resignation of one or more of these persons could have a material adverse impact on the business and its ability to repay our loan. A continued economic downturn and other events that negatively impact our target markets could
cause us to incur substantial loan losses that could materially harm our operating results. </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>We are heavily regulated by federal and
state agencies; changes in laws and regulations or failures to comply with such laws and regulations may adversely affect our operations and our financial results. </I></B></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">We and Sonabank are subject to extensive regulation, supervision and examination by federal and state banking authorities. Any change in applicable regulations or federal or state legislation could have a
substantial impact on us and Sonabank, and our respective operations. Additional legislation and regulations may be enacted or adopted in the future that could significantly affect our powers, authority and operations or the powers, authority and
operations of Sonabank, which could have a material adverse effect on our financial condition and results of operations. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman"
SIZE="2">Further, bank regulatory authorities have the authority to bring enforcement actions against banks and their holding companies for unsafe or unsound practices in the conduct of their businesses or for violations of any law, rule or
regulation, any condition imposed in writing by the appropriate bank regulatory agency or any written agreement with the agency. Possible enforcement actions against us could include the issuance of a cease-and-desist order that could be judicially
enforced, the imposition of civil monetary penalties, the issuance of directives to increase capital or enter into a strategic transaction, whether by merger or otherwise, with a third party, the appointment of a conservator or receiver, the
termination of insurance of deposits, the issuance of removal and prohibition orders against institution-affiliated parties, and the enforcement of such actions through injunctions or restraining orders. The exercise of this regulatory discretion
and power may have a negative impact on us. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>As a regulated entity, Sonabank must maintain certain required levels of regulatory capital that may
limit our operations and potential growth. </I></B></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">We and Sonabank are subject to various regulatory capital requirements
administered by the Federal Reserve. Failure to meet minimum capital requirements can initiate certain mandatory, and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on Sonabank&#146;s
and our company&#146;s consolidated financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, Sonabank must meet specific capital guidelines that involve quantitative measures of
Sonabank&#146;s assets, liabilities and certain off-balance sheet commitments as calculated under these regulations. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman"
SIZE="2">Quantitative measures established by regulation to ensure capital adequacy require Sonabank to maintain minimum amounts and defined ratios of total and Tier 1 capital to risk-weighted assets and of Tier 1 capital to adjusted total assets,
also known as the leverage ratio. For Sonabank, Tier 1 capital consists of shareholders&#146; equity excluding unrealized gains and losses on certain securities, less a portion of its mortgage servicing asset that is disallowed for capital. For
Sonabank, total capital consists of Tier 1 capital plus the allowance for loan and lease loss less a deduction for low level recourse obligations. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">As of June&nbsp;30, 2009, Sonabank exceeded the amounts required to be well capitalized with respect to all three required capital ratios. To be well capitalized, a bank must generally maintain a leverage
ratio of at least 5%, a Tier 1 risk-based capital ratio of at least 6% and a total risk-based capital ratio of at least 10%. However, the Federal Reserve could require Sonabank to increase its capital levels. For example, regulators have recently
required certain banking companies to maintain a leverage ratio of at least 8% and a total risk-based capital ratio of at least 12%. As of June&nbsp;30, 2009, Sonabank&#146;s leverage, Tier 1 risk-based capital and total risk-based capital ratios
were 13.46%, 14.52% and 15.69%, respectively. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Many factors affect the calculation of Sonabank&#146;s risk-based assets and
its ability to maintain the level of capital required to achieve acceptable capital ratios. For example, changes in risk weightings of assets relative to capital and other factors may combine to increase the amount of risk-weighted assets in the
Tier&nbsp;1 risk-based capital ratio and the total risk-based capital ratio. Any increases in its risk-weighted assets will require a corresponding increase in its capital to maintain the applicable ratios. In addition, recognized loan losses in
excess of amounts reserved for such losses, loan impairments, impairment losses on securities and other factors will decrease Sonabank&#146;s capital, thereby reducing the level of the applicable ratios. </FONT></P> <P
STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Sonabank&#146;s failure to remain well capitalized for bank regulatory purposes could affect customer confidence, our ability to grow, our
costs of funds and FDIC insurance costs, our ability to pay dividends on our capital stock, our ability to make acquisitions, and on our business, results of operations and financial condition. Under FDIC rules, if Sonabank ceases to be a well
capitalized institution for bank regulatory purposes, the interest rates that it pays on deposits and its ability to accept, renew or rollover brokered deposits may be restricted. As of June&nbsp;30, 2009, we had $104.9&nbsp;million of brokered
deposits, which represented 33.3% of our total deposits. </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>We may not be able to successfully compete with others for business. </I></B>
</FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">The metropolitan statistical area in which we operate is considered highly attractive from an economic and demographic
viewpoint, and is a highly competitive banking market. We compete for loans, deposits and investment dollars with numerous regional and national banks, online divisions of out-of-market banks and other community banking institutions, as well as
other kinds of financial institutions and enterprises, such as securities firms, insurance companies, savings associations, credit unions, mortgage brokers and private lenders. Many competitors have substantially greater resources than us, and
operate under less stringent regulatory environments. The differences in resources and regulations may make it harder for us to compete profitably, reduce the rates that we can earn on loans and investments, increase the rates we must offer on
deposits and other funds and adversely affect our overall financial condition and earnings. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:0px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>We are subject to transaction risk, which could adversely affect our business, financial condition and
results of operation. </I></B></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">We, like all businesses, are subject to transaction risk, which is the risk of loss resulting
from human error, fraud or unauthorized transactions due to inadequate or failed internal processes and systems, and external events that are wholly or partially beyond our control (including, for example, computer viruses or electrical or
telecommunications outages). Transaction risk also encompasses compliance risk, which is the risk of loss from violations of, or noncompliance with, laws, rules, regulations, prescribed practices or ethical standards. Although we seek to mitigate
transaction risk through a system of internal controls, there can be no assurance that we will not suffer losses from transaction risks in the future that may be material in amount. Any losses resulting from transaction risk could take the form of
explicit charges, increased operational costs, litigation costs, harm to reputation or forgone opportunities, any and all of which could have a material adverse effect on business, financial condition and results of operations. </FONT></P> <P
STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>We must respond to rapid technological changes and these changes may be more difficult or expensive than anticipated. </I></B></FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">If competitors introduce new products and services embodying new technologies, or if new industry standards and practices emerge, our
existing product and service offerings, technology and systems may become obsolete. Further, if we fail to adopt or develop new technologies or to adapt our products and services to emerging industry standards, we may lose current and future
customers, which could have a material adverse effect on our business, financial condition and results of operations. The financial services industry is changing rapidly and in order to remain competitive, we must continue to enhance and improve the
functionality and features of our products, services and technologies. These changes may be more difficult or expensive than we anticipate. </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman"
SIZE="2"><B>Risks Associated With Our Common Stock </B></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>Certain provisions under our amended Articles of Incorporation and applicable law
may make it difficult for others to obtain control of our corporation even if such a change in control may be favored by some shareholders. </I></B></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT
STYLE="font-family:Times New Roman" SIZE="2">Certain provisions in our amended Articles of Incorporation and applicable Virginia corporate law may have the effect of discouraging a change of control of our company even if such a transaction is
favored by some of our shareholders and could result in shareholders receiving a substantial premium over the current market price of our shares. The primary purpose of these provisions is to encourage negotiations with our management by persons
interested in acquiring control of our company. These provisions may also tend to perpetuate present management and make it difficult for shareholders owning less than a majority of the shares to be able to elect even a single director. These
provisions include, among other things, a staggered board of directors, restrictions on the manner in which special meetings may be called and the ability to issue blank check preferred stock. </FONT></P> <P
STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman" SIZE="2"><B><I>Your share ownership may be diluted by the issuance of additional shares of our common or preferred stock in the future. </I></B></FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Your share ownership may be diluted by the issuance of additional shares of our common or preferred stock or securities convertible into
common or preferred stock in the future. As of October 22, 2009, a total of 82,500 shares of our common stock are issuable pursuant to the exercise of warrants issued to cover organizational expenses at a price of $9.09 per share, 61,000 shares of
our common stock are issuable pursuant to the exercise of warrants granted to the organizers of Founders Corporation of Leesburg, Virginia, 43,174 of which are outstanding, at a price of $12.73 per share, 281,675 shares of our common stock are
issuable under options granted under our current 2004 Stock Option Plan at a weighted average exercise price of $8.56 per share and 20,825 shares of our common stock are reserved for future issuance to directors, employees and other individuals
under our 2004 Stock Option Plan. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">It is probable that options or warrants to purchase our common stock will be exercised
during their respective terms if the fair market value of our common stock exceeds the exercise price of the particular option or warrant. Our 2004 Stock Option Plan also provides that all issued options automatically and fully vest upon a change in
control of our company. If the warrants or stock options are exercised, your share ownership will be diluted. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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 <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">In addition, our board of directors may determine from time to time that we need to raise
additional capital by issuing additional shares of our common stock or other securities. Except as described under the heading &#147;Underwriting&#148; below, we are not restricted from issuing additional common stock or preferred stock, including
any securities that are convertible into or exchangeable for, or that represent the right to receive, common or preferred stock. The issuance of any additional shares of common stock or preferred stock or securities convertible into, exchangeable
for or that represent the right to receive common or preferred stock or the exercise of such securities could be substantially dilutive to shareholders of our common stock. New investors also may have rights, preferences and privileges that are
senior to, and that adversely affect, our then current shareholders. Holders of our shares of common stock have no preemptive rights that entitle holders to purchase their pro rata share of any offering of shares of any class or series. The market
price of our common stock could decline as a result of sales of shares of our common stock made after this offering or the perception that such sales could occur. We cannot predict or estimate the amount, timing or nature of our future offerings.
Thus, our shareholders bear the risk of our future offerings reducing the market price of our common stock and diluting their stock holdings. </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT STYLE="font-family:Times New Roman"
SIZE="2"><B><I>The trading volume of our common stock is less than that of other larger financial services companies. </I></B></FONT></P> <P STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman"
SIZE="2">Although our common stock is traded on the Nasdaq Global Market, the trading volume of our common stock is less than that of other larger financial services companies. For the public trading market for our common stock to have the desired
characteristics of depth, liquidity and orderliness requires the presence in the marketplace of willing buyers and sellers of our common stock at any given time. This presence depends on the individual decisions of investors and general economic and
market conditions over which we have no control. Given the lower trading volume of our common stock, significant sales of our common stock, or the expectation of these sales, could cause the our stock price to fall more than would otherwise be
expected if the trading volume of our common stock were commensurate with the trading volumes of the common stock of other financial services companies. </FONT></P> <P STYLE="margin-top:18px;margin-bottom:0px"><FONT
STYLE="font-family:Times New Roman" SIZE="2"><B><I>We currently do not intend to pay dividends on our common stock. In addition, our future ability to pay dividends is subject to restrictions. </I></B></FONT></P> <P
STYLE="margin-top:6px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">While we paid a nonrecurring 10% stock dividend to our holders of common stock in 2007, we have not paid any cash dividends to our holders of
common stock in the past and we currently do not intend to pay any cash or stock dividends on our common stock in the foreseeable future. In the event that we decide to pay dividends, there are a number of restrictions on our ability to pay
dividends. It is the policy of the Federal Reserve that bank holding companies should pay cash dividends on common stock only out of income available over the past year and only if prospective earnings retention is consistent with the
organization&#146;s expected future needs and financial condition. The policy provides that bank holding companies should not maintain a level of cash dividends that undermines the bank holding company&#146;s ability to serve as a source of strength
to its banking subsidiaries. </FONT></P> <P STYLE="margin-top:12px;margin-bottom:0px; text-indent:4%"><FONT STYLE="font-family:Times New Roman" SIZE="2">Our principal source of funds to pay dividends on our common stock will be cash dividends that
we receive from Sonabank. The payment of dividends by Sonabank to us is subject to certain restrictions imposed by federal and state banking laws, regulations and authorities. The federal banking statutes prohibit federally insured banks from making
any capital distributions (including a dividend payment) if, after making the distribution, the institution would be &#147;under-capitalized&#148; as defined by statute. In addition, the relevant federal and state regulatory agencies have authority
to prohibit an insured bank from engaging in an unsafe or unsound practice, as determined by the agency, in conducting an activity. The payment of dividends could be deemed to constitute such an unsafe or unsound practice, depending on the financial
condition of Sonabank. Federal or state regulatory authorities could impose administratively stricter limitations on the ability of Sonabank to pay dividends to us if such limits were deemed appropriate to preserve certain capital adequacy
requirements. </FONT></P> <P STYLE="margin-top:0px;margin-bottom:0px"><FONT SIZE="1">&nbsp;</FONT></P>
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