CMFB Commercefirst Bancorp (MM)

VOTING SECURITIES AND PRINCIPAL SHAREHOLDERS

Securities Ownership of Directors, Officers and Certain Beneficial Owners

The following table sets forth certain information concerning the number and percentage of whole shares of the Company’s common stock beneficially owned by its directors, executive officers whose compensation is disclosed, and by its directors and all executive officers as a group, as of March 14, 2008, as well as information regarding each other person known by the Company to own in excess of five percent of the outstanding common stock.  Except as set forth below, the Company knows of no other person or persons, who beneficially own in excess of five percent of the Company’s common stock.  Further, the Company is not aware of any arrangement which at a subsequent date may result in a change of control of the Company. Except as otherwise indicated with respect to directors and executive officers, all shares are owned directly, the named person possesses sole voting and sole investment power with respect to all such shares, and none of such shares are pledged as security.

(a)  The total number of shares beneficially owned includes shares of common stock owned by the named persons as of the date noted above, shares of common stock subject to warrants and shares of common stock subject to options held by the named persons that are exercisable as of, or within 60 days of, said date.

(b) The shares of common stock subject to warrants and options are deemed outstanding for the purpose of computing the percentage ownership of the person holding the warrants, but are not deemed outstanding for the purpose of computing the percentage ownership of any other person.

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(1)  Includes shares held in a family trust.

(2)  Based solely on information contained in filings made with the Securities and Exchange Commission.

(3)  Includes 97,654 shares as to which voting and dispositive power is shared by Mike Rosinus and T/R Partners.

ELECTION OF DIRECTORS

The size of the Company’s Board of Directors is currently set at nine (9) directors, divided into three classes, one of which is elected each year.  The Board of Directors has nominated three (3) persons for election as director at the meeting, for a three year term until the 2011 Annual Meeting of Shareholders and until their successors have been elected and qualified.  Each of the nominees for election as a director currently serves as a member of the Board of Directors.  Unless authority is withheld, all proxies in response to this solicitation will be voted for the election of the nominees listed below.  Each nominee has indicated a willingness to serve if elected.  However, if any nominee becomes unable to serve, the proxies received in response to this solicitation will be voted for a replacement nominee selected in accordance with the best judgment of the persons named as proxies.

The Board of Directors has determined that each director other than Mr. Jernigan II, Mr. Morgan, and Mr. Thomas is an “independent director” as that term is defined in Rule 4200(a)(15) of The NASDAQ Stock Market (the “NASDAQ”).  In making this determination, the Board of Directors was aware of and considered the loan and deposit relationships with directors and their related interests which the Company enters into in the ordinary course of its business, and the service arrangements which are disclosed under “Certain  Relationships and Related Transactions” in this proxy statement.

Vote Required and Board Recommendation.  Nominees receiving a plurality of the votes cast at the meeting in the election of directors will be elected as director, in the order of the number of votes received. Members of the Board of Directors of the Company having the power to vote or direct the voting of 324,019 shares of common stock, or approximately 17.8% of the shares of common stock outstanding on March 12, 2008, have indicated their intention to vote “FOR” the election of all of the nominees for election as director.

Nominees for Election as Directors

Set forth below is certain information as of March 12, 2008 concerning the nominees for election as director of the Company.  Except as otherwise indicated, the occupation listed has been such person’s principal occupation for at least the last five years.  Each of the nominees has served as a director of the Bank since its organization.

Milton D. Jernigan, II . Mr. Jernigan, 53, is an attorney engaged in private practice since 1982, is a co-founder and co-managing principal of the law firm of McNamee, Hosea, Jernigan, Kim, Greenan & Walker, P.A. He is the Resident Principal-in-Charge of the firm’s Annapolis office where his practice concentrates on business, real estate, tax and other matters including work with federal and state bank regulatory agencies.  Mr. Jernigan was one of the founding organizers and a member of the Board of Directors of the former Commerce Bank in College Park, Maryland where he served as General Counsel from its organization in 1989 until its acquisition by Main Street Bank Group (now a part of BB&T Corporation) in December 1997.  Mr. Jernigan is a resident of Annapolis, Maryland and is active in local bar associations, chambers of commerce, service and civic organizations, including the Maryland State and Anne Arundel County Bar Associations, the Annapolitan Club and service on the Board of Directors of the Annapolis and Anne Arundel County Chamber of Commerce.   Mr. Jernigan was one of the founding organizers of CommerceFirst Bank in 2000 and has been a director of the Company since its organization.

John A. Richardson, Sr. Mr. Richardson, 64, until his retirement in April 2000 was President of Branch Electric Supply Company, a position he had held since 1968. Mr. Richardson is also the President of Crofton Bowling Center, is a partner in numerous real estate investment partnerships located throughout Anne Arundel and Prince George’s Counties, continues to work as a consultant, and manages real estate. Mr. Richardson is a member of the National Bowling Proprietors Association. Mr. Richardson is a resident of Anne Arundel County. Mr. Richardson has been a director of the Company since October 2003.

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Jerome A. Watts.   Mr. Watts, 65, until his retirement in 2006 was the owner of Plan Management, a supplier of insurance and employee benefits plans.  Mr. Watts was appointed to the Board of Directors of the Company in September 2005 to fill a vacancy in the class of 2008 and was confirmed at the 2006 Annual Meeting of Shareholders. Mr. Watts was one of the original organizers and directors of Commerce Bank. Mr. Watts is a resident of Washington, DC.

Continuing Directors of the Company

Set forth below is certain information as of the Record Date concerning the continuing directors of the Company.  Except as otherwise indicated, the occupation listed has been such person’s principal occupation for at least the last five years.  Each of the continuing directors of the Company has served as a director of the Bank since its organization.

Edward B. Howlin, Jr. Mr. Howlin, 71, is the Chairman and Chief Executive Officer of Howlin Realty Management, Inc., a real estate holding, management and development firm, and of Edward B. Howlin, Inc., a management and holding company, and of its subsidiary companies, Dunkirk Supply, Inc. and Howlin Concrete, Inc. In addition to real estate management and development, the Howlin companies construct residential subdivisions and design, manufacture and sell construction components, systems and supplies to various commercial, residential and government projects, primarily in Southern Maryland. Mr. Howlin is a resident of Anne Arundel County. Mr. Howlin has been a director of the Company since its organization. Mr. Howlin’s current term expires in 2010.

Charles L. Hurtt, Jr., CPA. Mr. Hurtt, 61, is the founder and President of Charles L. Hurtt, Jr., P.A., a certified public accounting firm located in Pasadena, Maryland. Mr. Hurtt has been involved in several charitable and civic organizations, including organizations involved in youth programs in Prince George’s County.  Mr. Hurtt has also been active in several professional associations, including past or present memberships in the Maryland Society of Accountants, the National Society of Accountants and the Maryland Association of Certified Public Accountants.  Mr. Hurtt is a resident of Anne Arundel County. Mr. Hurtt has been a director of the Company since October 2003. Mr. Hurtt’s current term expires in 2010.

Robert R. Mitchell. Mr. Mitchell, 65, is currently retired. He was the President of Mitchell Business Equipment, Inc., with which he served for over 20 years until its sale in 1988. Mr. Mitchell was one of the original organizers and directors of Commerce Bank. Mr. Mitchell is active in local service and civic organizations, including membership in Rotary International for 20 years, service on the Prince George’s Salvation Army Local Board for 15 years and membership in the Anne Arundel Junior Golf Association for six years. Mr. Mitchell is a resident of Anne Arundel County. Mr. Mitchell has been a director of the Company since October 2003.  Mr. Mitchell’s current term expires in 2009.

Richard J. Morgan . Mr. Morgan, 60, is President and Chief Executive Officer of the Bank and the Company. From 1997 until July 1999, he was a cabinet level advisor to the Anne Arundel County Executive on issues relating to the economy and economic development, and was President and Chief Executive Officer of Anne Arundel Economic Development Corporation. From 1990 to 1997, Mr. Morgan served as President and Chief Executive Officer of Annapolis National Bank.  He has over 36 years of banking and financial management experience. He held leadership roles in commercial lending at Marine Midland Bank (now HSBC) from 1970 through 1977 and with Maryland National Bank (now Bank of America) from 1977 to 1982. He held the positions of Chief Financial Officer of Phillips Corporation and Toddson Corporation from 1982 to 1990. He has served on numerous community boards, commissions and community service groups, including as Board member and Assistant Treasurer of the Anne Arundel Medical Center; Board member and past Chair of United Way of Anne Arundel County; Board and Executive Committee as well as 2004 and 2005 Chair of the Annapolis and Anne Arundel Chamber of Commerce; Chair of the Chamber’s Economic Development Committee; Treasurer and member of the Executive Committee of the Maryland Economic Development Association; and Board and Executive Committee member of Leadership Anne Arundel and Chair for the Executive Leadership Program. Mr. Morgan is a resident of Anne Arundel County.  Mr. Morgan has been a director of the Company since its organization. Mr. Morgan’s current term expires in 2009.

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George C. Shenk, Jr.   Mr. Shenk, 55, is the President of Whitmore Group, a communications company headquartered in Annapolis, Maryland. Mr. Shenk is a resident of Anne Arundel County and has been a director of the Company since 2006. Mr. Shenk’s current term as a director of the Company expires in 2009.

Lamont Thoma s. Mr. Thomas, 67, was the Executive Vice President and Chief Operating Officer of the Bank and Company until his retirement as of December 31, 2007 and was Chief Financial Officer until September 10, 2007.  Mr. Thomas was one of the founding organizers and members of the Board of Directors of the former Commerce Bank in College Park, Maryland from its organization in 1989 until its acquisition by Main Street Bank Group (now a part of BB&T Corporation) in December 1997, serving as Executive Vice President and Treasurer (chief operating and financial officer) of Commerce Bank. Mr. Thomas is a resident of Howard County.  Mr. Thomas has been a director of the Company since its organization.  Mr. Thomas’ current term expires in 2010.

Committees, Meetings and Procedures of the Board of Directors

Meetings.  The Board of Directors of the Company met five (5) times during 2007.  All members of the Board of Directors attended at least 75% of the meetings held by the Board of Directors and by all committees on which such

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member served during the 2007 fiscal year or any portion thereof except Mr. Howlin and Mr. Mitchell who attended three out of the five meetings.

Audit Committee. The Board of Directors has a standing Audit Committee. The Audit Committee is responsible for the selection, review and oversight of the Company’s independent accountants, the approval of all audit, review and attest services provided by the independent accountants, the integrity of the Company’s reporting practices and the evaluation of the Company’s internal controls and accounting procedures. It also periodically reviews audit reports with the Company’s independent auditors.  The Audit Committee is currently comprised of Mr.  Hurtt (Chairman) and Messrs. Mitchell and Richardson . Each of the members of the Audit Committee is independent, as determined under the definition of independence adopted by the NASDAQ for audit committee members in Rule 4350(d)(2)(A).  The Board of Directors has adopted a written charter for the Audit Committee. A copy of the current charter is attached as Exhibit A to this proxy statement. During 2007, the Audit Committee met seven (7) times. The Board of Directors has determined that Mr. Hurtt is an “audit committee financial expert” as defined under regulations of the Securities and Exchange Commission.

The audit committee is also responsible for the pre-approval of all non-audit services provided by its independent auditors.  Non-audit services are only provided by the Company’s auditors to the extent permitted by law.  Pre-approval is required unless a “ de minimus ” exception is met. To qualify for the “ de minimus ” exception, the aggregate amount of all such non-audit services provided to the Company must constitute not more than five percent of the total amount of revenues paid by the Company to its independent auditors during the fiscal year in which the non-audit services are provided; such services were not recognized by the Company at the time of the engagement to be non-audit services; and the non-audit services are promptly brought to the attention of the committee and approved prior to the completion of the audit by the committee or by one or more members of the committee to whom authority to grant such approval has been delegated by the committee.

Nominations.  The Board of Directors has a standing nominating committee consisting of all of the members of the Board of Directors who are “independent directors” within the meaning of NASDAQ Rule 4200(a)(15). The nominating committee is responsible for the evaluation of nominees for election as director, the nomination of director candidates for election by the shareholders and evaluation of sitting directors.  The Board of Directors has adopted a charter addressing the nominations process.  A copy of the current charter is attached as Exhibit B to this proxy statement.

The Board has not developed a formal policy for the identification or evaluation of nominees.   In general, when the Board determines that expansion of the Board or replacement of a director is necessary or appropriate, the nominating committee will review, through candidate interviews with members of the Board and management, consultation with the candidate’s associates and through other means, a candidate’s honesty, integrity, reputation in and commitment to the community, judgment, personality and thinking style, willingness to invest in the Company, residence, willingness to devote the necessary time, potential conflicts of interest, independence, understanding of financial statements and issues, and the willingness and ability to engage in meaningful and constructive discussion regarding Company issues. The committee would review any special expertise, for example, expertise that qualifies a person as an audit committee financial expert, and membership or influence in a particular geographic or business target market, or other relevant business experience. To date the Company has not paid any fee to any third party to identify or evaluate, or to assist it in identifying or evaluating, potential director candidates.

The nominating committee will consider director candidates nominated by shareholders during such times as the Company is actively considering obtaining new directors.  Candidates recommended by shareholders will be evaluated based on the same criteria described above. Shareholders desiring to suggest a candidate for consideration should send a letter to the Company’s Secretary and include: (a) a statement that the writer is a shareholder (providing evidence if the person’s shares are held in street name) and is proposing a candidate for consideration; (b) the name and contact information for the candidate; (c) a statement of the candidate’s business and educational experience; (d) information regarding the candidate’s qualifications to be director, including but not limited to an evaluation of the factors discussed above which the Board would consider in evaluating a candidate; (e) information regarding any relationship or understanding between the proposing shareholder and the candidate; (f) information regarding potential conflicts of interest; and (g) a statement that the candidate is willing to be considered and willing to serve as director if nominated and elected.

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Because of the limited resources of the Company and the limited opportunity to seek additional directors, there is no assurance that all shareholder proposed candidates will be fully considered, that all candidates will be considered equally, or that the proponent of any candidate or the proposed candidate will be contacted by the Company or the Board, and no undertaking to do so is implied by the willingness to consider candidates proposed by shareholders.

Compensation.   The Company established a Compensation Committee of the Board of Directors during 2007. The Compensation Committee is currently comprised of Mr.  Shenk (Chairman) and Messrs. Howlin, Mitchell, Richardson and Watts.   Each of the members of the Committee is independent, as determined under the definition of independence adopted by the NASDAQ for board members in Rule 4200(a)(15).  The Committee determines all incentive compensation payments as well as the compensation levels of executive officers. The Committee presents its determinations to the Board of Directors for final approval.  The Board of Directors has not adopted a charter covering the activities of the Committee at this time.  To date, no compensation consultant has been engaged to assist the Committee or the Board of Directors in connection with establishing executive compensation.  The President and Chief Executive Officer plays no role in the determination of his compensation but may make recommendations as to other senior officers’ compensation.

Shareholder Communications. Company shareholders who wish to communicate with the Board of Directors or an individual director may write to CommerceFirst Bancorp, Inc., 1804 West Street, Suite 200, Annapolis, Maryland 21401, Attention: Candace M. Springmann, Corporate Secretary.  Your letter should indicate that you are a shareholder, and whether you own your shares in street name. Depending on the subject matter, management will: (a) forward the communication to the director or directors to whom it is addressed; (b) handle the inquiry directly or delegate it to appropriate employees, such as where the communication is a request for information, a stock related matter, or a matter related to ordinary course matters in the conduct of the Company’s banking business; or (c) not forward the communication where it is primarily commercial or political in nature, or where it relates to an improper, frivolous or irrelevant topic. Communications which are not forwarded will be retained until the next Board meeting, where they will be available to all directors. There is no assurance that all communications will receive a response.

Director Attendance at the Annual Meeting. The Board believes it is important for all directors to attend the Annual Meeting of Shareholders in order to show their support for the Company and to provide an opportunity for shareholders to communicate any concerns to them. Accordingly, it is the policy of the Company to encourage all directors to attend each Annual Meeting of Shareholders unless they are unable to attend by reason of personal or family illness or pressing matters. All of the Company’s sitting directors attended the 2007 Annual Meeting of Shareholders.

Based on these reviews and discussions, the Audit Committee has recommended to the Board of Directors that the audited financial statements be included in the Company’s annual report on Form 10-KSB for the year ended December 31, 2007.  The Audit Committee has also considered whether the amount and nature of non-audit services provided by Trice Geary & Myers LLC is compatible with the auditor’s independence.

Members of the Audit Committee: Charles L. Hurtt, Jr., CPA, Chairman; Robert Mitchell; John A. Richardson, Sr.

the Bank’s Board of Directors and its executive committee for the duration of the agreement, but will not receive fees for Board service during the term of the consulting agreement. He has previously been granted options to purchase 7,500 shares of common stock at an exercise price of $10.00 per share under his agreement; such options are to remain in force. The terms of Mr. Thomas’ employment agreement relating to change in control payments remain in force through August 15, 2009, pursuant to which Mr. Thomas could receive a lump sum payment of two times his base salary and bonuses paid to him during the prior twelve month period immediately preceding the change in control event (as defined). Under the amended agreement, Mr. Thomas’ compensation during 2007 will be considered his compensation for change in control purposes.  If Mr. Thomas were entitled to receive this payment as of December 31, 2007, he would have been entitled to receive a lump sum payment of approximately $366,000.

Executive Officers Who Are Not Directors

Set forth below is certain information regarding persons who are executive officers of the Company or the Bank and who are not directors of the Company or the Bank.  Except as otherwise indicated, the occupation listed has been such person’s principal occupation for at least the last five years.

Michael T. Storm.  Mr. Storm, 57, has served as Executive Vice President, Chief Operating Officer and Chief Financial officer of the Company and Bank since January 1, 2008, and served as Chief Financial Officer of the Company and Bank since September 12, 2007.  Mr. Storm previously served as Senior Vice President and Chief Financial Officer of CN Bancorp, Inc. and County National Bank, from 1998 until the acquisition of CN Bancorp by Sandy Spring Bancorp, Inc. in May 2007.  He had served in that capacity since 1998.  He previously served as Executive Vice President and Chief Financial Officer of Annapolis National Bank from 1990 to 1997.

incentive plans or compensation programs (other than discretionary bonuses), and does not maintain any defined benefit retirement plans, or deferred compensation plans or arrangements.

Employment Agreements. Mr. Morgan has an employment agreement with the Company pursuant to which he serves as President and Chief Executive Officer of the Bank. The employment agreement expires in August 2009. Under his employment agreement, Mr. Morgan is entitled to receive a 2008 base salary of $200,000 and a term life insurance policy in the amount of $300,000. He has previously been granted options to purchase 10,000 shares of common stock at an exercise price of $10.00 per share under his agreement.  Mr. Morgan is also entitled to receive bonuses and additional grants of options as determined by the Board of Directors, and to participate in all other health, welfare, benefit, stock, option and bonus plans, if any, generally available to officers or employees of the Company. Mr. Morgan is also entitled to the use of a leased vehicle or a comparable vehicle allowance.  The term of Mr. Morgan’s employment agreement expires on August 15, 2009 unless sooner terminated.  If the agreement is terminated by the Company without cause, the Company will continue to pay Mr. Morgan his annual compensation and benefits as severance compensation for a period of 12 months, i.e. $200,000. In the event of any change in control (as defined) of the Company, Mr. Morgan may continue his employment, execute a new employment agreement on mutually agreeable terms or resign his employment.  In the event that Mr. Morgan resigns or is terminated within 12 months of the change in control, Mr. Morgan will be entitled to the sum of twice the base salary and bonuses paid to him during the 12 months immediately preceding the change in control.  If Mr. Morgan were entitled to receive this payment as of December 31, 2007, he would have been entitled to receive a lump sum payment of approximately $459,000.  For a period on one year after termination of his employment, Mr. Morgan has agreed that he will not accept employment by or on behalf of any bank headquartered in Anne Arundel County, Maryland, or in such capacity request or advise any present or future investors, depositors or customers of the Company or the Bank to curtail or discontinue their business with the Company or the Bank, or induce, or attempt to induce, any employee of the Company or the Bank to terminate his employment with the Company or the Bank.  Mr. Morgan would also be subject to nondisparagement and nondisclosure obligations during this period.

In 2007, the Company entered into an employment agreement with Mr. Michael T. Storm to serve as Executive Vice President and Chief Operating Officer and Chief Financial Officer upon Mr. Thomas’ retirement on December 31, 2007. From September 2007 through December 2007, Mr. Storm was a Senior Vice President and Chief Financial Officer for the Company. Under his employment agreement, Mr. Storm is entitled to receive a 2007 and 2008 base salary of $140,000 and a term life insurance policy in the amount of $300,000.  Mr. Storm is also entitled to receive bonuses and to participate in all health, welfare, benefit, stock, option and bonus plans, if any, generally available to officers or employees of the Company. Mr. Storm is also entitled to a vehicle allowance of $500 per month. The term of Mr. Storm’s employment agreement expires on September 9, 2012 unless sooner terminated.  If the agreement is terminated by the Company without cause, the Company will continue to pay Mr. Storm his annual compensation rate and benefits as severance compensation for a period of six (6) months, i.e. $70,000. In the event of any change in control (as defined) of the Company, Mr. Storm may continue his employment, execute a new employment agreement on mutually agreeable terms or resign his employment.  In the event that Mr. Storm resigns or is terminated within 12 months of the change in control, then Mr. Storm will be entitled to twice his base salary, paid over a period of 12 months (the “change in control payment”), provided that if the change in control occurs prior to January 1, 2009, Mr. Storm shall not be entitled to any part of the change in control payment; if it occurs during 2009, he will be entitled to 20% of the change in control payment; if it occurs during 2010, he will be entitled to 40% of the change in control payment; if it occurs during 2011, he will be entitled to 60% of the change in control payment; if it occurs during 2012, he will be entitled to 80% of the change in control payment; and if it occurs in 2013 or beyond, he will be entitled to the entire change in control payment. For a period on one year after termination of his employment, Mr. Storm has agreed that he would be subject to nondisparagement and nondisclosure obligations. Mr. Storm would not be entitled to receive any payment in respect of a change of control as of December 31, 2007.

Employee Benefit Plans. The Bank provides a benefit program that includes health and dental insurance, life and long term and short-term disability insurance and a 401(k) plan under which the Company matches 50% of eligible employee contributions up to 6% of base salary.

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(1)                                   Represents options granted under named executive officers employment contract, vesting in three installments ending August 27, 2003.

(2)                                   Represents warrants granted in connection with organization of the Company, which vested in three installments ending August 27, 2003.

The Company has never maintained any plan for the award of equity based compensation other than stock options or warrants.  No options or warrants were exercised by any named executive officer in 2007 and no options held by such officers vested during 2007.

All services from the independent accountants during 2007 and 2006 were pre-authorized and requested by the Audit Committee of the Company prior to the services being performed.  The Audit Committee is required to approve all audit and non-audit services, if any, provided by Trice Geary & Myers LLC prior to such services being rendered. Non-audit services can only be provided by the Company’s independent accountant to the extent permitted by law. There were no services provided by Trice Geary & Myers LLC pursuant to the de minimus exception to the pre-approval requirement contained in the rules of the Securities and Exchange Commission.

annual meeting, or if less than forty five days notice of the meeting is given, by the earlier of two days before the meeting and fifteen days after the notice of the meeting is mailed.

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APPENDIX A

COMMERCEFIRST BANCORP, INC.

AUDIT COMMITTEE CHARTER

GOALS AND OBJECTIVES

The primary function of the audit committee (herein referred to as the “Committee”) is to oversee and report to the Board of Directors regarding the 1) integrity of the financial statements and accounting and financial reporting processes of CommerceFirst Bancorp, Inc. and its subsidiaries (the “Company”), 2) the Company’s compliance with legal and regulatory requirements, 3) the independent auditor’s qualifications and independence 4) the performance of the Company’s internal audit function and independent accountants; and perform the other duties of the Committee specified by federal securities laws and regulations, the Federal Deposit Insurance Act and related regulations, or the listing standards of The NASDAQ Stock Market, Inc. or other securities exchange or market on which the Company’s securities are listed or eligible for trading(“Listing Standards”).

While the Committee has the review, oversight, and reporting responsibilities set forth in this charter, it does not have responsibility for planning or conducting audits or for determining that the financial statements are complete and accurate and are in accordance with generally accepted accounting principles. Those are responsibilities of management and the independent accountants, rather than the Committee. The Committee also is not responsible for ensuring compliance with laws or regulations.

GENERAL RESPONSIBILITIES

  ·                 It is the responsibility of the Committee to maintain open avenues of communication among the internal auditors, the independent accountants, the board of directors and management.

  ·             The Committee will meet at least four times each year or more frequently if appropriate. The Committee chairman has the power to call a Committee meeting whenever he thinks there is a need. An audit Committee member should not vote on any matter in which he or she is not independent. The Committee may ask members of management or others to attend the meeting and is authorized to receive all pertinent information from management.

  ·             The Committee shall establish procedures for the (a) receipt, retention and treatment of complaints received by the Company regarding  accounting, internal accounting controls or auditing matters and (b)confidential, anonymous submission by the Company’s employees of concerns regarding questionable accounting or auditing matters.

  ·             The Committee shall regularly report on its activities to the Board and shall provide the Board with such information as the Board may request, and shall make such recommendations as the Committee shall deem appropriate.

  ·             The Committee shall fulfill such other duties and responsibilities as are required by applicable law, the regulations of the Securities and Exchange Commission (“SEC”), or the Listing Standards, and as assigned to the Committee from time to time by the Board.

MEMBERSHIP

  ·             The Committee shall consist of three or more independent directors, appointed by the Board on an annual basis. In determining the independence of members of the Committee, the Board shall meet current standards of independence established for service on the audit committee by applicable law, the regulations of the SEC, the Listing Standards and the Federal Deposit Insurance Corporation. At a minimum, all Committee members shall have (a) the ability to read and understand fundamental financial statements, including the Company’s balance sheet, income statement, cash flow statement, and key performance indicators; (b) the ability to understand key  business and financial risks, related controls and control processes. No member of the Committee shall have participated in the preparation of the financial statements of the Company or any current subsidiary of the Company at any time

during the past three years. At least one member of the Committee shall have past employment in finance or accounting, professional certification in accounting or other comparable experience or background which causes such member to be financially sophisticated, including being or having been a chief executive officer, chief financial officer or other senior officer with financial oversight responsibilities.

RESPONSIBILITIES FOR ENGAGING INDEPENDENT ACCOUNTANTS AND APPOINTING THE INTERNAL AUDITOR

  ·             The Committee shall be solely responsible for: (a) the appointment compensation, retention and oversight (including resolution of disagreements between management and the independent accountants  regarding financial reporting) and termination of the Company’s independent accountants engaged for the purpose of preparing or issuing an audit report or performing other audit, review and attest services, who shall report directly to the Committee, (b) the approval, before such engagement commences, of all audit, review and attest engagements of the independent accountants; and (c) the approval, before such engagement commences, of all non-audit service engagements of the independent accountants.

  ·             The Committee shall be solely responsible for determining and approving fees and other terms for engagements.

  ·             Notwithstanding the foregoing, the Committee shall not approve any non-audit service engagement where the provision of such service by the independent accountants is prohibited by applicable law, the regulations of the SEC or the Listing Standards, and the independent auditor shall not provide any such prohibited service.

  ·             Notwithstanding the foregoing, pre-approval is not required with respect to the provision of non-audit services if: (a) the aggregate amount of all such non-audit services provided to the Company constitutes not more than five percent of the total amount of revenues  paid by the Company to its independent auditors during the fiscal year  in which the non-audit services are provided; (b) such services were not recognized by the Company at the time of the engagement to be  non-audit services; and (c) the non-audit services are promptly brought to the attention of the Committee and approved by the Committee, or by one or more members of the Committee to whom authority to grant such approval has been delegated, prior to the completion of the audit.

  ·             The Committee may delegate the authority to grant such pre-approvals to one or more Committee members designated by the Committee, provided that any matters so pre-approved shall be presented to the full Committee at its next regular meeting.

  ·             The Committee will review and have veto power over the appointment, replacement, reassignment or dismissal of the head of internal audit services.

  ·             The Committee will oversee the compliance with lead (or coordinating) and review partner and other rotation requirements by the independent auditor.

  ·             On an annual basis, the Committee shall receive from the independent accountants the written disclosures and letters required to be provided, and review and discuss with the accountants all significant relationships the accountants have with the Company to determine the accountants’ independence.

  ·             The Committee will consider, in consultation with the independent accountant and internal audit, the audit scope and procedural plans made by internal audit services and the independent accountant. The Committee will review and discuss with internal audit services and the independent accountant their plans to coordinate the internal and external audits. The purpose of coordinating these efforts is to assure completeness of coverage, reduce redundancy and use audit resources effectively.

  ·             The Committee will listen to management and the independent auditor if either thinks there might be a need to engage additional auditors. The Committee will decide whether to engage an additional firm and, if so, which one.

RESPONSIBILITIES FOR REVIEWING INTERNAL AUDITS, THE ANNUAL EXTERNAL AUDIT AND THE REVIEW OF QUARTERLY AND ANNUAL FINANCIAL STATEMENTS

  ·             The Committee will ascertain that the independent accountant views the Committee as its client, that it will be available to the full board of directors at least annually and that it will provide the Committee with a timely analysis of significant financial reporting issues.

  ·             The Committee will discuss with management, the internal auditor and the independent accountant significant risks and exposures and will assess management’s steps to minimize them.

  ·             The Committee will review the following with the independent accountant, the internal auditor and management:

a.   The adequacy of the bank’s internal controls, including computerized information system controls and security; and the resolution of identified material weaknesses and reportable conditions in internal controls;

b.   Any fraud that involves management or other employees who have a significant role in the Company’s internal controls;

c.   Any significant findings and recommendations made by the independent accountant or internal auditing, together with management’s responses to them;

d.   All critical accounting policies and practices and any other  material components of the Company’s financial statements  involving management’s judgment or estimates, and about the quality of accounting principles and the clarity of financial disclosure practices used or proposed to be used by the Company;

e.   The alternative treatments of financial information within generally accepted accounting principles that have been discussed with management officials, ramifications of the use thereof, and the treatment preferred by the independent accountants, as well as  any required or suggested changes in auditing or accounting practices or principles;

f.   Material off-balance sheet transactions, arrangements, obligations  and other relationships of the Company with unconsolidated  entities or others that may have a material current or future effect on the Company’s financial condition, changes in financial  condition, results of operations, liquidity, capital expenditures, capital resources of significant components of revenue or expenses;

g.   Any material changes in accounting policies or practices and the impact thereof on the Company’s financial statements;

h.   The annual audited financial statements and quarterly financial statements, including the Company’s disclosures under “Management’s Discussion and Analysis of Financial Condition and Results of Operations;

i.   Any report or recommendations of the independent accountants;

j.   Anything else about the audit procedures or findings that GAAP requires the accountants to discuss with the Committee.

k.  Disclosures made by CEO and CFO during the Forms 10-K and 10-Q certification process about significant deficiencies in the design or operation of internal controls;

l.   Any difficulties or disputes encountered with management while conducting audits, including any restrictions on the scope of their work or access to required information.

  ·                 The Committee will review annual filings with the SEC and other published documents containing the Company’s financial statements and will consider whether the information in the filings is consistent with the information in the financial statements. The Committee shall discuss earnings press releases (particularly use of “pro forma,” or “adjusted” non-GAAP, information), as well as financial information and earnings guidance provided to analyst and rating agencies. Such matters may be discussed generally (e.g., types of information and presentations) and need not include specific releases or guidance.

  ·                 The Committee will determine that the quarterly financial statements have been reviewed by the independent accountants in accordance with SAS 100 before those interim statements are released to the public or filed with the SEC.

  ·                 The Committee shall prepare a report for inclusion in the proxy statement that describes the Committee’s composition and  responsibilities, and how they were discharged, including a statement regarding their review and discussion of the annual financial  statements, review of the independence of the independent accountants, and discussions with the independent accountants, and a statement that based on the foregoing, the Committee recommended that the annual financial statements be included in the Company’s annual report on Form10-K.

PERIODIC RESPONSIBILITIES

  ·                 On an on-going basis, the Committee shall conduct an appropriate review of all related party transactions for potential conflicts of interest and all such transactions shall be approved by the Committee to the extent required by applicable law.

  ·                 In performing its duties hereunder, the Committee shall have the authority to conduct or authorize investigations, to retain and terminate such outside legal, accounting or other advisors as it shall deem necessary, without seeking further approval of the Board of Directors, and the Company shall provide for appropriate funding therefore. The Committee may utilize, consult with and engage the members and resources of CommerceFirst Bank in the discharge of their duties.

  ·                 The Committee shall, to the extent is determines appropriate, review from time to time the expenses of the senior officers (and, if it so desires, any other officers) of the Company charged to the Company and any transactions between the Company and any of its subsidiaries.

  ·                 Review legal and regulatory matters that may have a material effect on the organization’s financial statements, compliance policies and programs and reports from regulators.

  ·                 Meet with the internal auditor, the independent accountant and management in separate executive sessions to discuss any matters that warrant Committee attention

  ·                 The Committee shall review and assess at least annually its performance, and the adequacy of this Charter in light of applicable law and the rules of the SEC and the Listing Standards.

  ·                 The Committee shall discuss the Company’s policies with respect to risk assessment and risk management, including legal and ethical compliance programs.

  ·                 Assess the continued adequacy of the Audit Services Charter as well as the responsibilities, budget and staffing of the internal audit services function.

APPENDIX B

COMMERCEFIRST BANCORP, INC.

NOMINATIONS PROCESS CHARTER

In order that the broadest viewpoints and perspectives may be brought into the evaluation of sitting directors, the decision whether to invite new directors and the determination and evaluation of potential candidates for nomination as director, the responsibility for identifying, evaluating and designating persons to stand for nomination or election as members of the Board of Directors of the Company shall reside collectively in all of the members of the Board of Directors who are “independent directors” as defined in Rule 4200(a)(15) of The Nasdaq Stock Market, Inc. (or successor rule or the listing standards of any other securities exchange or market on which the Company’s securities are listed or eligible for trading), and who are otherwise independent for purposes of such duties under other applicable law and regulation. Such directors are referred to in this Charter as the “Nominating Directors”.

In its determination of whether or not to recommend a director for nomination, the Nominating Directors should consider whether or not such director meets the minimum criteria for board membership based upon the individual’s honesty, integrity, reputation in and commitment to the community, judgment, personality and thinking style, willingness to invest in the Company, residence, willingness to devote the necessary time, potential conflicts of interest, independence, understanding of financial statements and issues, and the willingness and ability to engage in meaningful and constructive discussion regarding company issues. The Nominating Directors should also review any special expertise, for example, expertise that qualifies a person as an audit committee financial expert, and membership or influence in a particular geographic or business target market, or other relevant business experience, the candidate’s record, if any, of past service as a director of the Company, and may consider additional factors it deems appropriate.

The Nominating Directors shall meet at such times as are established by the full Board of Directors or the Nominating Directors.

The Nominating Directors may consider director candidates nominated by shareholders, other directors, officers, employees or other sources. In general, the Nominating Directors need consider such nominees only during such times as the Company is actively considering obtaining new directors, but the Nominating Directors shall have discretion to consider and evaluate any candidate at any time.

Candidates recommended by shareholders should be evaluated based on the same criteria as other candidates. Shareholders desiring to suggest a candidate for consideration should send a letter to the Company’s Secretary and include: (a) a statement that the writer is a shareholder (providing evidence if the person’s shares are held in street name) and is proposing a candidate for consideration; (b) the name and contact information for the candidate; (c) a statement of the candidate’s business and educational experience; (d) information regarding the candidate’s qualifications to be director, including but not limited to an evaluation of the factors discussed above which the Board would consider in evaluating a candidate; (e) information regarding any relationship or understanding between the proposing shareholder and the candidate; (f) information regarding potential conflicts of interest; and (g) a statement that the candidate is willing to be considered and willing to serve as director if nominated and elected.

The Nominating Directors may establish reasonable rules for the conduct of meetings, subject to the requirements of this charter. In the absence of such rules, the Nominating Directors shall conduct business in accordance with the same rules and standards utilized by the full Board of Directors. The Nominating Directors may meet by conference call or in person, and also may act by unanimous consent. A majority of the Nominating Directors constitutes a quorum. Minutes of meeting of the Nominating Directors shall be kept in the same manner as minutes of the full Board of Directors.