Exhibit 10.1

 

AGREEMENT

 

THIS AGREEMENT (this “Agreement”), dated this 18th day of December, 2019, is
entered into by and among The First Bancshares, Inc., a Mississippi corporation
(“FBMS”), Southwest Georgia Financial Corporation, a Georgia corporation
(“SWGB”), and George DeWitt Drew, an individual resident of the State of Georgia
(“Executive”).

 

WHEREAS, FBMS and SWGB have entered into an Agreement and Plan of Merger, dated
as of 18th day of December, 2019 (the “Merger Agreement”), pursuant to which
SWGB will merge with and into FBMS, and Southwest Georgia Bank (“Bank”), SWGB’s
wholly-owned subsidiary bank, will merge with and into The First (“The First”),
FBMS’ wholly-owned subsidiary bank, in accordance with the terms of the Merger
Agreement (the “Mergers”);

 

WHEREAS, SWGB and Bank previously entered into an Employment Agreement with
Executive, dated as of the 1st day of October, 2003, as further amended by the
Amendment to Employment Agreement, dated as of the 17th day of December, 2008
(collectively, the “Employment Agreement”); and

 

WHEREAS, the Mergers will constitute a change in the ownership of both SWGB and
Bank within the meaning of Section 409A(a)(2)(A)(v) of the Internal Revenue Code
of 1986, as amended (the “Code”), and the parties hereto now desire to terminate
the Employment Agreement upon the Effective Time (as defined in the Merger
Agreement) in accordance with the terms of this Agreement and consistent with
Treas. Reg. §1.409A-3(j)(4)(ix)(B);

 

NOW, THEREFORE, for and in consideration of the premises contained herein and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the undersigned parties hereby agree as follows:

 

1.       Termination of Employment Agreement. Upon the Effective Time, the
Employment Agreement shall terminate and SWGB shall pay to Executive in a single
lump sum $586,838 (the “Payout Amount”), net of applicable tax withholdings.
After payment of the Payout Amount, neither FBMS, SWGB, Bank, The First nor
Executive will have any further rights or obligations under the Employment
Agreement except as otherwise specifically set forth herein. Notwithstanding the
foregoing, Section 4.1(c), Section 4.4, Section 5 and Section 6 of the
Employment Agreement shall survive the termination of the Employment Agreement
and continue in full force and effect, and FBMS and The First, as successors to
SWGB and Bank, respectively, expressly assume and agree to perform any
obligations of SWGB and/or Bank that remain in effect after the Effective Time.

 

2.       Continued Employment.

 

(a)     On and after the Effective Time and until the later of (i) two weeks
following operational conversion and integration of SWGB with and into FBMS, and
Bank with and into The First, which conversion and integration is anticipated to
end no earlier than June of 2020, and (ii) June 30, 2020 (the “Employment
Term”), Executive will remain employed with FBMS and The First and be paid a
base salary of $200,000 per annum, net of applicable tax withholdings, payable
in accordance with The First’s regular payroll practices. During the Employment
Term, Executive will continue to participate in the Split Dollar Plan, as
described in Section 4.1(c) of the Employment Agreement. If Executive’s
employment is terminated prior to the last day of the Employment Term by FBMS
and The First other than for Cause (as defined herein), then The First will pay
to Executive the amount of base salary that would have been paid through the end
of the Employment Term, net of applicable tax withholdings, payable in
approximately equal installments in accordance with The First’s regular payroll
practices. For purposes of this Agreement, “Cause” shall mean any of the
following acts by Executive, as determined by FBMS in good faith:

 

 

 

 

Executive is convicted of, pleads guilty to, or confesses to any felony or any
act of fraud, misappropriation or embezzlement or Executive violates the
surviving provisions of Section 5 of the Employment Agreement.

 

(b)     In addition, if Executive remains employed with FBMS and The First on
the last day of the Employment Term (the “Retention Date”), then Executive will
receive a lump sum retention payment equal to $61,500 (the “Retention Bonus”).
The Retention Bonus, less withholding for taxes, will be paid to Executive in a
lump sum within 15 days following the Retention Date. If Executive’s employment
is terminated prior to the Retention Date by FBMS and The First other than for
Cause, then the Retention Bonus will be paid to Executive in a lump sum within
15 days following Executive’s date of termination. Employee acknowledges and
agrees that Executive will forfeit all rights to the Retention Bonus if, prior
to the Retention Date, Employee resigns voluntarily or Executive’s employment is
terminated by FBMS and The First for Cause.

 

3.       Termination of Employment. Upon expiration of the Employment Term,
Executive will be entitled to receive any and all vested compensation and
benefits under any compensation arrangements or benefit plans or programs in
which Executive participated in accordance with the terms of such compensation
arrangements or benefit plans or programs, including without limitation the
right to elect continued coverage under Section 4980B of the Code.

 

4.       409A Compliance. The parties intend for the payments and benefits under
this Agreement to be exempt from Section 409A of the Code, or, if not so exempt,
to be paid or provided in a manner that complies with the requirements of such
Section 409A of the Code. This Agreement will be construed and administered in
accordance with such intent.

 

5.       Governing Law. This Agreement will be governed by and construed in
accordance with the laws of the State of Georgia, without regard to principles
of conflicts of law.

 

[Signature Page Follows]

 

 

 

 

IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date
first written above.

 

  THE FIRST BANCSHARES, INC.           By: /s/ M. Ray Cole, Jr.     Name: M. Ray
Cole, Jr.     Title: Vice Chairman, President and Chief Executive Officer      
    SOUTHWEST GEORGIA FINANCIAL CORPORATION           By: /s/ Roy H. Reeves    
Name: Roy H. Reeves     Title: Chairman           EXECUTIVE           By: /s/
George DeWitt Drew     Name: George DeWitt Drew