EMPLOYMENT CONTRACT

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EXHIBIT 10.7

EMPLOYMENT CONTRACT

This Employment Contract ("Contract") made and effective this 22nd day of

November, 2004, by and between Lori Laurent Smith ("Employee") and UNITED

BANCORP, INC., 205 E. Chicago Blvd., P.O. Box 248, Tecumseh, Michigan 49286

("UBI") and UNITED BANK & TRUST (the "Bank").

WHEREAS, UBI and the Bank desire to continue to employ Employee, and

WHEREAS, Employee desires to continue to be employed by UBI and the Bank,

and

WHEREAS, there is increased activity by multi-bank holding companies in

the acquisition of independent community banks, which often jeopardizes the

continued employment of senior officers of the acquired bank, and whereas, UBI

wishes to minimize the uncertainty and distraction caused by such activity,

which would detract from Employee's ability to perform his duties, by providing

Employee with some transition assistance if the Bank and/or UBI is acquired or

if there is a change in control or if Employee's employment is terminated in

anticipation of such an acquisition, merger, change in control, or similar

transaction,

THEREFORE, UBI and Employee hereby enter into this Employment Contract on

the following terms and conditions:

1. General. The parties hereto deem it mutually desirable that this Contract

entered into be binding upon each of them.

2. Term and Payment Upon Termination in Certain Circumstances. Unless sooner

terminated (i) by mutual agreement evidenced in writing and signed by all

parties, or (ii) by the Board of Directors of UBI for cause, the employment by

UBI of Employee as an officer shall be for a one year term commencing with the

date hereof. If (other than after a Change in Control, as defined below) UBI

shall terminate Employee's employment other than for the reasons set forth in

paragraph 6, below, or by mutual agreement, Employee shall continue to receive

his regular salary (the salary in effect immediately prior to such termination)

for six months. This continuation of salary shall immediately cease if the

Employee secures employment before the end of this six-month period.

3. Term of Contract. This Contract shall be for a 14-month period, unless

terminated earlier pursuant to paragraph 6.

4. Duties. The duties, responsibilities and authority of Employee shall be as

determined by UBI or the Bank, from time to time.

5. Compensation. It is further agreed between the parties that Employee's annual

salary shall be directly related to the Board of Directors' reasonable and good

faith determination of the value of his services to the Bank, but shall not be

less than $90,000.

a. Employee's annual salary for 2004/2005 shall be $90,000, unless

adjusted pursuant to item d., below.

b. It is contemplated that an annual bonus shall be paid. Employee will

be a Group 3 Participant in the Target Incentive Compensation Plan.

c. Employee shall receive the standard employee benefits of employees

of the Bank.

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d. Changes may be made to the salary and fringe benefits herein set

forth and such changes shall be set forth in Attachment A. Changes

to the salary and fringe benefits are effective only after

Attachment A has been signed by the Chairman of the Board of both

UBI and the Bank, and by the Employee.

6. a. In the event of any violation by Employee of any terms of this

Agreement, or if there is cause for termination of Employee,

Employee's employment may be terminated immediately, without notice,

at any time, and with compensation only to the date of the

termination of Employee. "Cause" for termination of this Contract

shall include the following events, but this list is simply some

examples of "cause" and it is not all-inclusive:

(1) the death of Employee;

(2) the disability of Employee rendering him unable to perform the

services required under the Contract for a period of 180 days;

(3) known substance abuse by Employee;

(4) felony conviction or plea (including a plea of guilty, nolo

contendere or similar plea) of Employee;

(5) misdemeanor conviction or plea (including a plea of guilty,

nolo contendere or similar plea) of Employee, if the

misdemeanor involves moral turpitude;

(6) Employee's repeated unprofessional, irresponsible or

disruptive language or conduct in the performance of his

duties;

(7) Employee's dishonesty, breach of professional or corporate

ethics, or criticism by a regulatory agency involving a

serious violation of law or regulations;

(8) Employee's substantial breach of any significant term of this

Contract, including, but not limited to, continued

unsatisfactory job performance.

If criminal charges as described above in subsections (4) and (5)

are made against Employee, then UBI or the Bank shall have the

discretion to suspend Employee for any period of time, except that

the suspension shall end if such charges do not result in a

conviction or a plea (of guilty or nolo contendere, etc.) of either

the original charge or of any lesser charge. If a regulatory agency

criticizes Employee for serious regulatory violations, UBI or the

Bank shall have the discretion to suspend Employee for any period of

time, except that if the alleged violations are resolved in his

favor, the suspension shall end. A suspension, pursuant to items

(4), (5) or (7), above, would entail the cessation of the

performance of duties and the cessation of all compensation.

The Chairmen of the Boards of UBI or the Bank each shall retain the

power and authority to suspend Employee based on his determination

that one of the events described above has occurred.

Termination of this Contract shall not relieve Employee of his

responsibilities to complete any records, cooperate with the Bank

and UBI on any litigation, audits, regulatory reviews, claims or

investigations, and otherwise to fulfill all responsibilities under

this Contract which should have been rendered prior to the early

termination of this Contract.

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b. In the event of the occurrence of any of the following by Employee,

Employee's employment may be terminated immediately, without notice,

at any time, and with compensation for six months thereafter, unless

the Employee secures employment sooner, which shall terminate all

obligation for compensation of UBI and the Bank. The following are

occurrences which shall lead to termination:

(i) Repeated unsatisfactory performance or repeated uncooperative

conduct;

(ii) Employee's repeated failure to meet the goals and objectives

which shall be established by the Boards of UBI and the Bank

from time to time; or

(iii) Any other continued unsatisfactory job performance or conduct.

7. Change in Control. For purposes of this Contract, a Change in Control of UBI

shall be deemed to have occurred if

a. there shall be consummated (i) any consolidation or merger of UBI in

which UBI is not the continuing or surviving corporation or pursuant

to which shares of UBI's common stock would be converted into cash,

securities or other property, other than a merger of UBI in which

the holders of UBI's common stock immediately prior to the merger

have the same proportionate ownership of common stock of the

surviving corporation immediately after the merger or (ii) any sale,

lease, exchange or other transfer (in one transaction or a series of

related transactions) of all, or substantially all, of the assets of

UBI (including, without limitation, more than 25% of UBI's equi