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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;border-top:double 2.25pt;padding-top:1;'>&nbsp;</p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><B><font SIZE=2>UNITED STATES</font></B></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><B><font SIZE=2>SECURITIES AND EXCHANGE COMMISSION</font></B></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font size=2>Washington, D.C. 20549</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font size=2>___________</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><B><font SIZE=2>FORM 8-K</font></B></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><B><font SIZE=2>CURRENT REPORT</font></B></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font size=2>Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>Date of Report (Date of earliest event reported):  </font><b><font size=2>December 17, 2008</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><b><font size=2>___________</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><B><font SIZE=3>MONARCH FINANCIAL HOLDINGS, INC.</font></B></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>(Exact name of registrant as specified in its charter)</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Virginia</font></b></p>
<p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=2>(State or other jurisdiction</font></p>
<p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=2>of incorporation)</font></p>
<p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td  colspan="2" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><b><font size=2>000-52032</font></b></p>
<p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=2>(Commission</font></p>
<p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=2>File Number)</font></p> </td>
        <td width="213" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p align=center style='margin:0in;margin-bottom:.0001pt;text-align:center; text-indent:45.0pt'><b><font size=2>20-4985388</font></b></p>
<p style='margin-left:0pt;text-indent:35.25pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=2>(I.R.S. Employer</font></p>
<p style='margin-left:0pt;text-indent:30.0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=2>Identification No.)</font></p>
<p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td> </tr>
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            <p align=center style='margin:0in;margin-bottom:.0001pt;text-align:center'><b><font size=2>1101 Executive Boulevard</font></b></p>
<p align=center style='margin-top:0in;margin-right:0in;margin-bottom:.75pt; margin-left:0in;text-align:center'><b><font size=2>Chesapeake, Virginia </font></b></p>
<p style='margin-left:0pt;text-indent:3.0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=2>(Address of principal executive offices)</font></p>
<p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p>
<p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><b><font size=2>23320</font></b></p>
<p style='margin-left:0pt;text-indent:3.0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=2>(Zip Code)</font></p>
<p style='margin-left:0pt;text-indent:0pt;text-align:center;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td> </tr>
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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>Registrant&#146;s telephone number, including area code:  </font><b><font size=2>(757)</font></b><font size=2>&nbsp;</font><b><font size=2>389-5111</font></b></p>

<p style=' margin-bottom:3pt; margin-top:12pt;text-align:center;'><b><font size=2>Not Applicable</font></b></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>(Former name or former address, if changed since last report)</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:justify;'><font size=2>&nbsp;</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt;line-height:116.64%'><font size=2>Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)</font></p> </td> </tr></table>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt;line-height:116.64%'><font size=2>Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)</font></p> </td> </tr></table>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt;line-height:116.64%'><font size=2>Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))</font></p> </td> </tr></table>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt;line-height:116.64%'><font face=Wingdings>o</font></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt;line-height:116.64%'><font size=2>Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))</font></p> </td> </tr></table>
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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Item 1.01.</font></b></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Entry into a Material Definitive Agreement.</font></b></p> </td> </tr></table>
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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:0.56in;text-align:left;'><font size=2>On December 19, 2008, as part of the Capital Purchase Program established by the U.S. Department of the Treasury (the &#147;Treasury&#148;) under the Emergency Economic Stabilization Act of 2008 (&#147;EESA&#148;), Monarch Financial Holdings, Inc. (the &#147;Company&#148;) entered into a Letter Agreement and Securities Purchase Agreement&#151;Standard Terms (collectively, the &#147;Purchase Agreement&#148;) with the Treasury, pursuant to which the Company sold (i) 14,700 shares of the Company&#146;s Fixed Rate Cumulative Perpetual Preferred Stock, Series A, $5.00 par value per share, having a liquidation preference of $1,000 per share (the &#147;Preferred Stock&#148;), and (ii) a warrant (the &#147;Warrant&#148;) to purchase 264,706 shares of the Company&#146;s common stock, $5.00 par value per share (the &#147;Common Stock&#148;), at an initial exercise price of $8.33 per share, subject to
certain anti-dilution and other adjustments, for an aggregate purchase price of $14,700,000 in cash.  The Purchase Agreement is attached as Exhibit 10.1 hereto and is incorporated herein by reference.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:0.57in;text-align:left;'><font size=2>The Preferred Stock will qualify as Tier 1 capital and will pay cumulative dividends at a rate of 5%&nbsp;per annum for the first five years, and thereafter at a rate of 9%&nbsp;per annum.  The Preferred Stock ranks senior to the Common Stock with respect to the payment of dividends and the distribution of assets on liquidation, dissolution and winding up of the Company.  The Company may not redeem the Preferred Stock during the first three years except with the proceeds from a &#147;Qualified Equity Offering&#148; (as defined in the Purchase Agreement). After three years, the Company may, at its option, redeem the Preferred Stock at the liquidation amount plus accrued and unpaid dividends. The Preferred Stock is generally non-voting.  Before December&nbsp;19, 2011, unless the Company has redeemed the Preferred Stock or the Treasury has transferred the Preferred Stock to a third party, the
consent of the Treasury will be required for the Company to declare or pay a dividend on its Common Stock or repurchase its Common Stock or other equity or capital securities, other than in certain circumstances specified in the Purchase Agreement. The form of certificate for the Preferred Stock is attached as Exhibit 4.1 hereto and is incorporated herein by reference. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:0.57in;text-align:left;'><font size=2>The Warrant is immediately exercisable. The Warrant provides for the adjustment of the exercise price and the number of shares of Common Stock issuable upon exercise pursuant to customary anti-dilution provisions, such as upon stock splits or distributions of securities or other assets to holders of Common Stock, and upon certain issuances of Common Stock at or below a specified price relative to the then-current market price of Common Stock. The Warrant expires ten years from the issuance date. If, on or before December&nbsp;31, 2009, the Company receives aggregate gross cash proceeds of not less than the purchase price of the Preferred Stock from one or more &#147;Qualified Equity Offerings&#148; announced after October&nbsp;13, 2008, the number of shares of Common Stock issuable pursuant to the Treasury&#146;s exercise of the Warrant will be reduced by one-half of the original number of
shares, taking into account all adjustments, underlying the Warrant. Pursuant to the Purchase Agreement, the Treasury has agreed not to exercise voting power with respect to any shares of Common Stock issued upon exercise of the Warrant. The Warrant is attached as Exhibit 4.2 hereto and is incorporated herein by reference. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:0.57in;text-align:left;'><font size=2>Upon the request of the Treasury at any time, the Company has agreed to promptly enter into a deposit arrangement pursuant to which the Preferred Stock may be deposited and </font></p>

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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>depositary shares (&#147;Depositary Shares&#148;), representing fractional shares of Preferred Stock, may be issued. The Company has agreed to register the Preferred Stock, the Warrant, the shares of Common Stock underlying the Warrant and Depositary Shares, if any, on written request from the Treasury. </font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Item 3.02.</font></b></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Unregistered Sale of Equity Securities.</font></b></p> </td> </tr></table>
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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:0.57in;text-align:left;'><font size=2>The Preferred Stock and the Warrant were issued to the Treasury in a private placement exempt from registration pursuant to Section 4(2) of the Securities Act. The Company has not engaged in general solicitation or advertising with regard to the issuance and sale of the securities and has not offered securities to the public in connection with this issuance and sale.  The information set forth under &#147;Item 1.01. Entry into a Material Definitive Agreement&#148; is incorporated herein by reference.</font></p>

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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Material Modification to Rights of Security Holders.</font></b></p> </td> </tr></table>
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<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:0.57in;text-align:left;'><font size=2>The information set forth under &#147;Item 1.01. Entry into a Material Definitive Agreement&#148; and &#147;Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year&#148; is incorporated herein by reference.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:0.57in;text-align:left;'><font size=2>Under the Articles of Amendment described in &#147;Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year,&#148; the Company&#146;s ability to declare or pay dividends or to repurchase its Common Stock or other equity or capital securities will be subject to restrictions if it fails to declare and pay (or set aside for payment) full dividends on the Preferred Stock.</font></p>

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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Item 5.02.</font></b></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.</font></b></p> </td> </tr></table>
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<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:0.61in;text-align:left;'><font size=2> (e)    </font><font size=2>&nbsp;&nbsp;&nbsp;&nbsp;</font><font size=2>As a condition to the closing of the transaction, each of Messrs. William F. Rountree Jr., Brad E. Schwartz, E. Neal Crawford Jr., William T. Morrison and Edward O. Yoder, the Company&#146;s Senior Executive Officers (as defined in subsection 111(b) of the EESA), executed a waiver (the &#147;Waiver&#148;) voluntarily waiving any claim against the Treasury or the Company for any changes to such Senior Executive Officer&#146;s compensation or benefits that are required to comply with the regulation issued by the Treasury under the Program as published in the Federal Register on October 20, 2008 and acknowledging that the regulation may require modification of the compensation, bonus, incentive and other benefit plans, arrangements, policies and agreements (including so-called &#147;golden parachute&#148; agreements)
(collectively, &#147;Benefit Plans&#148;) as they relate to the period the Treasury holds any equity or debt securities of the Company acquired through the Program. The Waiver was effective December 19, 2008.   Each of the Senior Executive Officers also entered into a letter agreement (the &#147;Letter Agreement&#148;) with the Company whereby each Senior Executive Officer agreed to amend the Benefit Plans with respect to such Senior Executive Officer as may be necessary, during the period that the Treasury owns any debt or equity securities of the Company acquired through the Program, to comply with Section 111(b) of the EESA. The Company also required certain of its </font></p>

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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>other officers to enter into the Letter Agreement.  The Waiver is attached as Exhibit 10.2 hereto and is incorporated herein by reference. The form of Letter Agreement is attached as Exhibit 10.3 hereto and is incorporated herein by reference. </font></p>

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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Item</font></b><font size=2>&nbsp;</font><b><font size=2>5.03.</font></b></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Amendment to Articles of Incorporation or Bylaws; Change in Fiscal Year.</font></b></p></td></tr></table>
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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:0.56in;text-align:left;'><font size=2>On December 17, 2008, the Company filed the Articles of Amendment with the Commonwealth of Virginia State Corporation Commission for the purpose of amending its Articles of Incorporation to fix the designations, preferences, limitations and relative rights of the Preferred Stock.  The Articles of Amendment are attached hereto as Exhibit 3.1 and are incorporated herein by reference.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:0.57in;text-align:left;'><font size=2>A copy of the Company&#146;s press release announcing the above transaction is attached hereto as Exhibit 99.1 and incorporated by reference herein.</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><b><font size=2>Financial Statements and Exhibits</font></b><font size=2>.</font></p> </td> </tr></table>
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<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>(d)</font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Exhibits </font></p> </td> </tr></table>
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<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font size=2>Exhibit No.</font></u></p> </td>
        <td width="93" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><font size=2>Description</font></u></p> </td> </tr></table>
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<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>


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        <td width="96" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>3.1</font></p> </td>
        <td width="396" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Articles of Amendment with respect to the Preferred Stock</font></p> </td> </tr></table>
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        <td width="96" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>4.1</font></p> </td>
        <td width="293" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Form of Certificate for the Preferred Stock</font></p> </td> </tr></table>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>4.2</font></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Warrant to Purchase Common Stock</font></p> </td> </tr></table>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>10.1</font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Letter Agreement, dated December 19, 2008, by and between Monarch Financial Holdings, Inc. and the United States Department of the Treasury</font></p> </td> </tr></table>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>10.2</font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Waiver by and between the Senior Executive Officers and Monarch Financial Holdings, Inc.</font></p> </td> </tr></table>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>10.3</font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Form of Letter Agreement by and between the Senior Executive Officers and Monarch Financial Holdings, Inc.</font></p> </td> </tr></table>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="96" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>99.1</font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Press Release dated December 19, 2008</font></p> </td> </tr></table>
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<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:1.5in; text-indent:-1in;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:2in; text-indent:-0.75in;text-align:justify;'><font size=2>&nbsp;</font></p>
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<p style=' margin-bottom:3pt; margin-top:12pt;text-align:center;'><font SIZE=2>SIGNATURES</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:0.5in;text-align:justify;'><font 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=' margin-bottom:0pt; margin-top:0pt; text-indent:0.5in;text-align:justify;'><font size=2>&nbsp;</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="102" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font SIZE=2>MONARCH FINANCIAL HOLDINGS, INC.</font></p> </td> </tr>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="102" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="42" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="228" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="102" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td> </tr>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:1.0pt;margin-bottom:0pt'><font size=2>Date:  December 19, 2008</font></p> </td>
        <td width="102" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:1.0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="42" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:1.0pt;margin-bottom:0pt'><font size=2>By:</font></p> </td>
        <td width="228" valign=top style='border-bottom:solid black 1.0pt; padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>/s/ Brad E. Schwartz</font></p> </td>
        <td width="102" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:1.0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td> </tr>
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        <td width="193" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="102" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="42" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="228" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=2>Brad E. Schwartz</font></p> </td>
        <td width="102" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:justify;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td> </tr>
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        <td width="193" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="102" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="42" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td  colspan="2" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Executive Vice President, Chief Financial and </font></p> </td> </tr>
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        <td width="193" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="102" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="42" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="228" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Operating Officer</font></p> </td>
        <td width="102" valign=top style='padding:0in 5.4pt 0in 5.4pt'>
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td> </tr></table>
</div>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:left;'><font size=2>&nbsp;</font></p>
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<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><B><font SIZE=2>EXHIBIT</font></B><font size=2>&nbsp;</font><B><font SIZE=2>INDEX </font></B></p>

<p style=' margin-bottom:0pt; margin-top:0pt;text-align:center;'><font size=2>&nbsp;</font></p>

<p style=' margin-bottom:0pt; margin-top:0pt; text-indent:1in;text-align:left;'><font size=2>&nbsp; </font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="192" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><b><font size=2>Exhibit No.</font></b></u></p> </td>
        <td width="99" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><u><b><font size=2>Description</font></b></u></p> </td> </tr></table>
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<p style=' margin-bottom:0pt; margin-top:0pt; margin-left:0.5in;text-align:left;'><font size=2>&nbsp;</font></p>


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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="96" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>3.1</font></p> </td>
        <td width="396" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Articles of Amendment with respect to the Preferred Stock</font></p> </td> </tr></table>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="96" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>4.1</font></p> </td>
        <td width="293" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Form of Certificate for the Preferred Stock</font></p> </td> </tr></table>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="96" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>4.2</font></p> </td>
        <td width="253" nowrap valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Warrant to Purchase Common Stock</font></p> </td> </tr></table>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="96" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>10.1</font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Letter Agreement, dated December 19, 2008, by and between Monarch Financial Holdings, Inc. and the United States Department of the Treasury</font></p> </td> </tr></table>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=1>&nbsp;</font></p> </td>
        <td width="96" valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>10.2</font></p> </td>
        <td  valign=top >
            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Waiver by and between the Senior Executive Officers and Monarch Financial Holdings, Inc.</font></p> </td> </tr></table>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>10.3</font></p> </td>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Form of Letter Agreement by and between the Senior Executive Officers and Monarch Financial Holdings, Inc.</font></p> </td> </tr></table>
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            <p style='margin-left:0pt;text-indent:0pt;text-align:left;margin-top:0pt;margin-bottom:0pt'><font size=2>Press Release dated December 19, 2008</font></p> </td> </tr></table>
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{"company-data": {"conformed-name": "Monarch Financial Holdings, Inc.", "cik": "0001364856", "assigned-sic": "6022", "irs-number": "000000000", "state-of-incorporation": "VA", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "000-52032", "film-number": "081261112"}, "business-address": {"street1": "1101 EXECUTIVE BOULEVARD", "city": "CHESAPEAKE", "state": "VA", "zip": "23320", "phone": "757-389-5112"}, "mail-address": {"street1": "1101 EXECUTIVE BOULEVARD", "city": "CHESAPEAKE", "state": "VA", "zip": "23320"}}
Form 8-K
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
December 17, 2008
___________
MONARCH FINANCIAL HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
Virginia
(State or other jurisdiction
of incorporation)
000-52032
(Commission
File Number)
20-4985388
(I.R.S. Employer
Identification No.)
1101 Executive Boulevard
Chesapeake, Virginia
(Address of principal executive offices)
23320
(Zip Code)
Registrant's telephone number, including area code:
(757)
389-5111
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 1.01.
Entry into a Material Definitive Agreement.
On December 19, 2008, as part of the Capital Purchase Program established by the U.S. Department of the Treasury (the "Treasury") under the Emergency Economic Stabilization Act of 2008 ("EESA"), Monarch Financial Holdings, Inc. (the "Company") entered into a Letter Agreement and Securities Purchase Agreement—Standard Terms (collectively, the "Purchase Agreement") with the Treasury, pursuant to which the Company sold (i) 14,700 shares of the Company's Fixed Rate Cumulative Perpetual Preferred Stock, Series A, $5.00 par value per share, having a liquidation preference of $1,000 per share (the "Preferred Stock"), and (ii) a warrant (the "Warrant") to purchase 264,706 shares of the Company's common stock, $5.00 par value per share (the "Common Stock"), at an initial exercise price of $8.33 per share, subject to
certain anti-dilution and other adjustments, for an aggregate purchase price of $14,700,000 in cash.  The Purchase Agreement is attached as Exhibit 10.1 hereto and is incorporated herein by reference.
The Preferred Stock will qualify as Tier 1 capital and will pay cumulative dividends at a rate of 5% per annum for the first five years, and thereafter at a rate of 9% per annum.  The Preferred Stock ranks senior to the Common Stock with respect to the payment of dividends and the distribution of assets on liquidation, dissolution and winding up of the Company.  The Company may not redeem the Preferred Stock during the first three years except with the proceeds from a "Qualified Equity Offering" (as defined in the Purchase Agreement). After three years, the Company may, at its option, redeem the Preferred Stock at the liquidation amount plus accrued and unpaid dividends. The Preferred Stock is generally non-voting.  Before December 19, 2011, unless the Company has redeemed the Preferred Stock or the Treasury has transferred the Preferred Stock to a third party, the
consent of the Treasury will be required for the Company to declare or pay a dividend on its Common Stock or repurchase its Common Stock or other equity or capital securities, other than in certain circumstances specified in the Purchase Agreement. The form of certificate for the Preferred Stock is attached as Exhibit 4.1 hereto and is incorporated herein by reference.
The Warrant is immediately exercisable. The Warrant provides for the adjustment of the exercise price and the number of shares of Common Stock issuable upon exercise pursuant to customary anti-dilution provisions, such as upon stock splits or distributions of securities or other assets to holders of Common Stock, and upon certain issuances of Common Stock at or below a specified price relative to the then-current market price of Common Stock. The Warrant expires ten years from the issuance date. If, on or before December 31, 2009, the Company receives aggregate gross cash proceeds of not less than the purchase price of the Preferred Stock from one or more "Qualified Equity Offerings" announced after October 13, 2008, the number of shares of Common Stock issuable pursuant to the Treasury's exercise of the Warrant will be reduced by one-half of the original number of
shares, taking into account all adjustments, underlying the Warrant. Pursuant to the Purchase Agreement, the Treasury has agreed not to exercise voting power with respect to any shares of Common Stock issued upon exercise of the Warrant. The Warrant is attached as Exhibit 4.2 hereto and is incorporated herein by reference.
Upon the request of the Treasury at any time, the Company has agreed to promptly enter into a deposit arrangement pursuant to which the Preferred Stock may be deposited and
depositary shares ("Depositary Shares"), representing fractional shares of Preferred Stock, may be issued. The Company has agreed to register the Preferred Stock, the Warrant, the shares of Common Stock underlying the Warrant and Depositary Shares, if any, on written request from the Treasury.
Item 3.02.
Unregistered Sale of Equity Securities.
The Preferred Stock and the Warrant were issued to the Treasury in a private placement exempt from registration pursuant to Section 4(2) of the Securities Act. The Company has not engaged in general solicitation or advertising with regard to the issuance and sale of the securities and has not offered securities to the public in connection with this issuance and sale.  The information set forth under "Item 1.01. Entry into a Material Definitive Agreement" is incorporated herein by reference.
Item 3.03.
Material Modification to Rights of Security Holders.
The information set forth under "Item 1.01. Entry into a Material Definitive Agreement" and "Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year" is incorporated herein by reference.
Under the Articles of Amendment described in "Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year," the Company's ability to declare or pay dividends or to repurchase its Common Stock or other equity or capital securities will be subject to restrictions if it fails to declare and pay (or set aside for payment) full dividends on the Preferred Stock.
Item 5.02.
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
(e)
As a condition to the closing of the transaction, each of Messrs. William F. Rountree Jr., Brad E. Schwartz, E. Neal Crawford Jr., William T. Morrison and Edward O. Yoder, the Company's Senior Executive Officers (as defined in subsection 111(b) of the EESA), executed a waiver (the "Waiver") voluntarily waiving any claim against the Treasury or the Company for any changes to such Senior Executive Officer's compensation or benefits that are required to comply with the regulation issued by the Treasury under the Program as published in the Federal Register on October 20, 2008 and acknowledging that the regulation may require modification of the compensation, bonus, incentive and other benefit plans, arrangements, policies and agreements (including so-called "golden parachute" agreements)
(collectively, "Benefit Plans") as they relate to the period the Treasury holds any equity or debt securities of the Company acquired through the Program. The Waiver was effective December 19, 2008.   Each of the Senior Executive Officers also entered into a letter agreement (the "Letter Agreement") with the Company whereby each Senior Executive Officer agreed to amend the Benefit Plans with respect to such Senior Executive Officer as may be necessary, during the period that the Treasury owns any debt or equity securities of the Company acquired through the Program, to comply with Section 111(b) of the EESA. The Company also required certain of its
other officers to enter into the Letter Agreement.  The Waiver is attached as Exhibit 10.2 hereto and is incorporated herein by reference. The form of Letter Agreement is attached as Exhibit 10.3 hereto and is incorporated herein by reference.
Item
5.03.
Amendment to Articles of Incorporation or Bylaws; Change in Fiscal Year.
On December 17, 2008, the Company filed the Articles of Amendment with the Commonwealth of Virginia State Corporation Commission for the purpose of amending its Articles of Incorporation to fix the designations, preferences, limitations and relative rights of the Preferred Stock.  The Articles of Amendment are attached hereto as Exhibit 3.1 and are incorporated herein by reference.
A copy of the Company's press release announcing the above transaction is attached hereto as Exhibit 99.1 and incorporated by reference herein.
Item
9.01.
Financial Statements and Exhibits
.
(d)
Exhibits
Exhibit No.
Description
3.1
Articles of Amendment with respect to the Preferred Stock
4.1
Form of Certificate for the Preferred Stock
4.2
Warrant to Purchase Common Stock
10.1
Letter Agreement, dated December 19, 2008, by and between Monarch Financial Holdings, Inc. and the United States Department of the Treasury
10.2
Waiver by and between the Senior Executive Officers and Monarch Financial Holdings, Inc.
10.3
Form of Letter Agreement by and between the Senior Executive Officers and Monarch Financial Holdings, Inc.
99.1
Press Release dated December 19, 2008
SIGNATURES
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.
MONARCH FINANCIAL HOLDINGS, INC.
Date:  December 19, 2008
By:
/s/ Brad E. Schwartz
Brad E. Schwartz
Executive Vice President, Chief Financial and
Operating Officer
EXHIBIT
INDEX
Exhibit No.
Description
3.1
Articles of Amendment with respect to the Preferred Stock
4.1
Form of Certificate for the Preferred Stock
4.2
Warrant to Purchase Common Stock
10.1
Letter Agreement, dated December 19, 2008, by and between Monarch Financial Holdings, Inc. and the United States Department of the Treasury
10.2
Waiver by and between the Senior Executive Officers and Monarch Financial Holdings, Inc.
10.3
Form of Letter Agreement by and between the Senior Executive Officers and Monarch Financial Holdings, Inc.
99.1
Press Release dated December 19, 2008