Monarch Financial Holdings, Inc. 2009 Annual Report - Monarch Bank

We were named one of the “Best Places to Work” in Hampton Roads in 2009, an accomplishment of which we are extremely proud. We have alwaysput our people first in building our family-friendly culture, and this award recognizes this care and dedication to our people. We are a company of firstnames, and we are finally becoming an employer of choice in our markets.We are excited about the people that joined us in 2009 and those that are scheduled to join us in 2010. Our business is a people business, with mostof our clients doing business with a person vs. the name on the company door. Not only did we hire a number of top quality bankers in 2009, we haveannounced or will soon announce the hiring of several top-notch experienced bankers for Hampton Roads and the Outer Banks.Community bank stocks continued to trend down in 2009, with MNRK thankfully holding steady year over year. It is extremely frustrating to reportimproved financial performance and other positive events and see no upward movement in our stock price. Since we cannot control the overall market,our only option is to remain focused on building a great company and telling our story. When community bank stocks are again in favor for investors,we hope to deliver some long overdue stock price appreciation. We know our goal is to create long-term shareholder value and we take that missionvery seriously.We would like to recognize the dedication of Mr. Cassell Basnight, a founder of our company, who served as Chairman of the Board of Directorsfrom our inception in 1998 to 2006. Along with two others, he had the original idea to form Monarch Bank, and we operated out of the “attic” in his lawoffice during our organization period. He has served Monarch faithfully for twelve years now, and we wish him well in his retirement. His guidance andleadership will be missed.I also want to thank the incredible support we receive from our six Boards of Directors comprising our Corporate Board, our City boards inChesapeake, Virginia Beach, and Norfolk, our OBX Bank board, and our Hampton Roads Leadership Board. All of these talented groups of business andcivic leaders assist us in generating business activity and keep us close to our markets as our extended eyes and ears on the streets. It is only throughtheir commitment to serve that we have prospered and we are grateful for all they do.Giving back to the community is a trademark of Monarch, and during economic downturns the community needs our help more than ever. I ampleased to report our annual community sponsored golf tournament to support local children’s charities was again a great success in 2009, with over50 children’s charities supported since we began the tournament and over $800,000 in distributions made. With this tournament, other communitysponsorships, and the time given by our staff to support local charities and churches, we continue to make a difference in our communities.You will notice three signatures on this year’s letter. A leadership transition began this past year with Brad Schwartz being named CEO of MonarchBank and Neal Crawford being named President. Neal and Brad have each been with Monarch for over six years and have done a remarkable jobin driving our success. As we move forward with this transition, I want to assure you that “Tree” is not going anywhere and will continue to provideleadership and direction for Monarch for many years to come.The butterfly gained strength in 2009 and we have a bright future. We will be opportunistic in the coming years and keep a balanced focus onlong-term financial performance and franchise growth. Remember to think of Monarch and all of our companies and recommend us to your friends,family, neighbors and business associates.William Rountree, Jr.President & CEOMonarch Financial Holdings, Inc.Brad SchwartzChief Executive OfficerMonarch BankNeal CrawfordPresidentMonarch Bankover 50 children’s charities supported since we began the tournament and over $800,000 in distributions I we are an employer of choice in our markets named to 2009 list of “Best Places to Work”8th Annual Monarch BankCharitable Golf Tournamentprofited over $140,000 tobenefit local children’s charitiesin our community. (left to right):William “Tree” Rountree, Jr.,Mike Kelly, Jeff Benson, DwightSchaubach, Neal Crawford,Brad Schwartz, Mike Crockfordand Jon Wheeler