ALAMOGORDO FINANCIAL CORPORATION 1,101,643 Shares COMMON STOCK (Par Value $.0l Per Share) Subscription Price $10.00 Per Share AGENCY AGREEMENT ___________ __, 2000 Charles Webb & Company, a Division of Keefe, Bruyette & Woods, Inc. 211 Bradenton Avenue Dublin, Ohio 43017 Ladies and Gentlemen: Alamogordo Financial Corporation, a federal corporation (the "Company"), AF Mutual Holding Company (the "MHC") and Alamogordo Federal Savings and Loan Association, a federally chartered stock savings and loan association (the "Bank") with its deposit accounts insured by the Savings Association Insurance Fund ("SAIF") administered by the Federal Deposit Insurance Corporation ("FDIC"), hereby confirm, jointly and severally, their agreement with Charles Webb & Company, a Division of Keefe, Bruyette & Woods, Inc. (the "Agent"), as follows: Section 1. The Offering. In accordance with the Stock Issuance Plan adopted by its Board of Directors (the "Plan"), the Company will offer and sell up to 1,101,643 shares of its common stock, par value, $.01 per share (the "Shares" or "Common Stock"), in a subscription offering (the "Subscription Offering") to (1) depositors of the Bank with account balances of $50.00 or more as of September 30, 1998 ("Eligible Account Holders"), (2) the Employee Stock Ownership Plan of the Bank (the "ESOP"), (3) depositors of the Bank with account balances of $50.00 or more as of December 31, 1999 ("Supplemental Eligible Account Holders"), and (4) employees, officers and directors of the Bank. To the extent Shares remain unsold in the Subscription Offering, the Company is offering for sale in a community offering (the "Community Offering" and when referred to together with the Subscription Offering, the "Subscription and Community Offering") the Shares not so subscribed for or ordered in the Subscription Offering to members of the general public, with preference given to natural persons residing in the New Mexico counties of Otero and