EXHIBIT 10.1

EMPLOYMENT AGREEMENT

THIS AGREEMENT is made as of the 4th day of  August 2005, by and among MOUNTAIN
STATE BANK (the “Employer”), a bank organized under the laws of the State of
Georgia, and SPENCER STRICKLAND, a resident of the State of Georgia (the
“Executive”).

RECITALS:

The Employer desires to employ the Executive as its Executive Vice President and
Forsyth County President and the Executive desires to accept such employment
upon the terms and conditions set forth below.  

In consideration of the above premises and the mutual agreements hereinafter set
forth, the parties hereby agree as follows:

1.

Definitions.  Whenever used in this Agreement, the following terms and their
variant forms shall have the meaning set forth below:

1.1

“Agreement” shall mean this Agreement and any exhibits incorporated herein
together with any amendments hereto made in the manner described in this
Agreement.

1.2

“Affiliate” shall mean any business entity which controls the Employer, is
controlled by or is under common control with the Employer.

1.3

“Area” shall mean the geographic area within Dawson and Forsyth Counties,
Georgia.  It is the express intent of the parties that the Area as defined
herein is the area where the Executive performs services on behalf of the
Employer under this Agreement.  

1.4

“Business of the Employer” shall mean the business conducted by the Employer,
which is the business of commercial banking.

 

1.5

“Cause” shall mean:

1.5.1

With respect to termination by the Employer,

(a)

a material breach of the terms of this Agreement by the Executive, including,
without limitation, failure by the Executive to perform his duties and
responsibilities in the manner and to the extent required under this Agreement,
which remains uncured after the expiration of sixty (60) days following the
delivery of written notice of such breach to the Executive by the Employer.
 Such notice shall

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(i)

specifically identify the duties that the President and Chief Executive Officer
of the Employer believes the Executive has failed to perform,

(ii)

state the facts upon which the President and Chief Executive Officer made such
determination.

(b)

conduct by the Executive that amounts to fraud, dishonesty or willful misconduct
in the performance of his duties and responsibilities hereunder;

(c)

charged in relation to (by criminal information, indictment or otherwise) or
conviction of the Executive during the Term of a felony or any other crime
involving breach of trust or moral turpitude;

(d)

conduct by the Executive that amounts to gross and willful insubordination or
inattention to his duties and responsibilities hereunder; or

(e)

the receipt of any form of notice, written or otherwise, that any regulatory
agency having jurisdiction over the Employer intends to institute any form of
formal or informal regulatory action against the Executive or the Employer,
provided that the Board of Directors of the Employer determines in good faith
that such action involves acts or omission by or under the supervision of the
Executive or that termination of the Executive could materially advance the
Employer’s compliance with the purpose of the action or would materially assist
the Employer in avoiding or reducing the restrictions or adverse effects to the
Employer related to the regulatory action.

1.5.2

With respect to termination by the Executive,

(a)

a material diminution in the powers, responsibilities or duties of the Executive
hereunder;

(b)

a material breach of the terms of this Agreement by the Employer, which remains
uncured after the expiration of thirty (30) days following the delivery of
written notice of such breach to the Employer by the Executive; or

(c)

following a Change of Control,

(i)

a reduction of the Executive’s Base Salary and annual bonus opportunity to an
amount which is less than the average Base Salary and annual bonus paid to the
Executive in the two calendar years immediately preceding the effective date of
the Change of Control, without the Executive’s consent;

(ii)

relocation of the principal office to which the Executive reports on a regular
basis to a location which is more than twenty-five (25)

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miles from the Executive’s principal office location as of the date of the
Change of Control without the Executive’s consent, except for reasonably
required business travel which is not materially greater than the Executive’s
travel requirements prior to the Change of Control; or

(iii)

failure by the Employer to provide benefits following a Change of Control
substantially similar to the benefits available to the Executive prior to the
Change of Control.

1.6

“Change of Control” means any one of the following events:

(a)

the acquisition by any person or persons acting in concert of the then
outstanding voting securities of either the Employer or the Company, if, after
the transaction, the acquiring person (or persons) owns, controls or holds with
power to vote twenty-five percent (25%) or more of any class of voting
securities of either the Employer or the Company, as the case may be;

(b)

within any twelve-month period (beginning on or after the Effective Date) the
persons who were directors of either the Employer or the Company immediately
before the beginning of such twelve-month period (the “Incumbent Directors”)
shall cease to constitute at least a majority of such board of directors;
provided that any director who was not a director as of the beginning of such
twelve-month period shall be deemed to be an Incumbent Director if that director
were elected to such board of directors by, or on the recommendation of or with
the approval of, at least two-thirds (2/3) of the directors who then qualified
as Incumbent Directors; and provided further that no director whose initial
assumption of office is in connection with an actual or threatened election
contest relating to the election of directors shall be deemed to be an Incumbent
Director;

(c)

a reorganization, merger, share exchange combination, or consolidation, with
respect to which persons who were the stockholders of the Employer or the
Company, as the case may be, immediately prior to such reorganization, merger,
share exchange combination, or consolidation do not, immediately thereafter, own
more than fifty percent (50%) of the combined voting power entitled to vote in
the election of directors of the reorganized, merged, combined or consolidated
company’s then outstanding voting securities; or

(d)

the sale, transfer or assignment of all or substantially all of the assets of
the Company and its subsidiaries to any third party.

1.7

“Company” means Mountain Bancshares, Inc., a bank holding company organized
under the laws of the State of Georgia.

1.8

“Confidential Information” means data and information relating to the business
of the Employer (which does not rise to the status of a Trade Secret) which is
or has been disclosed to the Executive or of which the Executive became aware as
a consequence of or through the Executive’s relationship to the Employer and
which has value to the Employer and is not generally

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known to its competitors.  Confidential Information shall not include any data
or information that has been voluntarily disclosed to the public by the Employer
(except where such public disclosure has been made by the Executive without
authorization) or that has been independently developed and disclosed by others,
or that otherwise enters the public domain through lawful means.

1.9

“Disability” shall mean the inability of the Executive to perform each of his
material duties under this Agreement for the duration of the short-term
disability period under the Employer’s policy then in effect as certified by a
physician chosen by the Employer and reasonably acceptable to the Executive.

1.10

“Effective Date” shall mean August 4, 2005.

1.11

“Employer Information” means Confidential Information and Trade Secrets.

1.12

“Initial Term” shall mean that period of time commencing on the Effective Date
and running until the earlier of the close of business on the last business day
immediately preceding the third anniversary of the Effective Date or any earlier
termination of employment of the Executive under this Agreement as provided for
in Section 3.

1.13

“Term” shall mean the Initial Term and all subsequent renewal periods.

1.14

“Trade Secrets” means Employer information including, but not limited to,
technical or nontechnical data, formulas, patterns, compilations, programs,
devices, methods, techniques, drawings, processes, financial data, financial
plans, product plans or lists of actual or potential customers or suppliers
which:

(a)

derives economic value, actual or potential, from not being generally known to,
and not being readily ascertainable by proper means by, other persons who can
obtain economic value from its disclosure or use; and

(b)

is the subject of efforts that are reasonable under the circumstances to
maintain its secrecy.  

2.

Duties.

2.1

Position.  The Executive is employed as Executive Vice President and Forsyth
County President of the Employer and, subject to the direction of the President
and Chief Executive Officer of the Employer, shall perform and discharge well
and faithfully the duties which may be assigned to him from time to time by the
Employer in connection with the conduct of its business.  The duties and
responsibilities of the Executive are set forth on Exhibit A attached hereto.

2.2

Full-Time Status.  In addition to the duties and responsibilities specifically
assigned to the Executive pursuant to Section 2.1 hereof, the Executive shall:  

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(a)

devote substantially all of his time, energy and skill during regular business
hours to the performance of the duties of his employment (reasonable vacations
and reasonable absences due to illness excepted) and faithfully and
industriously perform such duties;

(b)

diligently follow and implement all reasonable and lawful management policies
and decisions communicated to him by the President and Chief Executive Officer
of the Employer; and

(c)

timely prepare and forward to the President and Chief Executive Officer of the
Employer all reports and accountings as may be requested of the Executive.

2.3

Permitted Activities.  The Executive shall not during the Term be engaged
(whether or not during normal business hours) in any other business or
professional activity which conflicts with the full execution of the Executive’s
duties for the Employer, whether or not such activity is pursued for gain,
profit or other pecuniary advantage; but this shall not be construed as
preventing the Executive from:

(a)

investing his personal assets in businesses which (subject to clause (b) below)
are not in competition with the Business of the Employer and which will not
require any services on the part of the Executive in their operation or affairs
and in which his participation is solely that of an investor;

(b)

purchasing securities in any corporation, the securities of which are regularly
traded provided that such purchase shall not result in him collectively owning
beneficially at any time five percent (5%) or more of the equity securities of
any business in competition with the Business of the Employer; and

(c)

participating in civic and professional affairs, conferences and organizations
or serving on committees or boards of such organizations, preparing or
publishing papers or books or teaching so long as the President and Chief
Executive Officer of the Employer approves in writing of such activities prior
to the Executive’s engaging in them.  

3.

Term and Termination.

3.1

Term.  This Agreement shall remain in effect for the Term.  At the end of the
Initial Term, the Agreement shall automatically renew for one successive
twelve-month period (the “Renewal Period”).  Commencing with the first day of
the Renewal Period, the Term shall renew each day such that the Term remains a
one-year term from day-to-day thereafter unless any party gives written notice
to the others of its or his intent that the automatic renewals shall cease with
such written notice to be given not less than sixty (60) days prior to the end
of the Term.  In the event such notice of non-renewal is properly given, this
Agreement and the Term shall expire on the first anniversary of the thirtieth
day following the date such written notice is received.

3.2

Termination.  During the Term, the employment of the Executive under this
Agreement may be terminated only as follows:

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3.2.1

By the Employer:

(a)

For Cause, upon written notice to the Executive pursuant to Section 1.5.1
hereof, in which event the Employer shall have no further obligation to the
Executive except for payment of any Base Salary due and owing under Section 4.1
on the effective date of termination and reimbursement under Section 4.5 of
expenses incurred as of the effective date of termination;

(b)

Without Cause at any time, provided that the Employer shall give the Executive
sixty (60) days’ prior written notice of its intent to terminate, in which event
the Executive shall be entitled to the following:

(i)

a lump sum payment equal to the sum of (A) the greater of (I) the sum of his
Base Salary which would be payable for the remainder of the Term and a pro-rata
portion of any annual bonus that would be paid for the calendar year in which
occurs the effective date of termination as determined in accordance with
Section 3.4.1; or (II) one and one-half (1½) times the sum of his Base Salary
and a pro-rata portion of any annual bonus that would be paid for the calendar
year in which occurs the effective date of termination as determined in
accordance with Section 3.4.1; and (B) a cash payment for each vacation day
which the Executive has not used during the calendar year in which occurs the
effective date of termination, which amount shall be determined based on a daily
rate of the Executive’s Base Salary assuming two hundred sixty (260) business
days in such year;

(ii)

any unvested stock options held by the Executive on the effective date of
termination shall become fully vested and exercisable as of the effective date
of termination; and

(iii)

to the extent permitted by the applicable policies or contracts or applicable
law (including the COBRA continuation coverage requirements under Code Section
4980B), continuation of health insurance benefits made available to the
Executive by the Employer for twelve (12) months following termination at the
same level and in the same manner as provided immediately prior to the
Executive’s termination of employment.  The cost of such insurance coverage
shall be allocated among the Employer and the Executive in the same manner as
prior to the termination and any costs borne by the Executive shall be paid to
the Employer in advance at the beginning of each month.  In the event of the
Executive’s death or subsequent employment by another employer who maintains
health insurance for its employees, the coverage provided under this Subsection
(iii) shall cease.

(c)

Upon the Disability of the Executive at any time, provided that the Employer
shall give the Executive sixty (60) days’ prior written notice of its intent

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to terminate, in which event the Employer shall be required to continue to meet
its obligation to the Executive under Section 4.1 for six (6) months following
the termination or until the Executive begins receiving payments under the
Employer’s long-term disability policy, whichever occurs first.  To the extent
permitted by the applicable plan or contract or applicable law (including the
COBRA continuation coverage requirements under Code Section 4980B), the
Executive shall be entitled to continuation of health insurance benefits then
made available to the Executive by the Employer for twelve (12) months following
termination at the same level and in the same manner as provided immediately
prior to termination of the Executive’s employment.  The cost of such insurance
coverage shall be allocated among the Employer and the Executive in the same
manner as prior to the termination and any costs borne by the Executive shall be
paid to the Employer in advance at the beginning of each month.  In the event of
the Executive’s death or subsequent employment by another employer who provides
health insurance coverage for its employees, the coverage provided under this
Section 3.2.1(c) shall cease.  In addition, any unvested stock options held by
the Executive on the effective date of termination shall become fully vested and
exercisable as of the effective date of termination.

3.2.2

By the Executive:

(a)

For Cause, upon written notice to the Employer pursuant to Section 1.5.2 hereof,
in which event the Executive shall be entitled to the following:

(i)

a lump sum payment equal to the sum of (A) the greater of (I) the sum of his
Base Salary which would be payable for the remainder of the Term and a pro-rata
portion of any annual bonus that would be paid for the calendar year in which
occurs the effective date of termination as determined in accordance with
Section 3.4.1; or (II) one (1) times the sum of his Base Salary and a pro-rata
portion of any annual bonus that would be paid for the calendar year in which
occurs the effective date of termination as determined in accordance with
Section 3.4.1; and (B) a cash payment for each vacation day which the Executive
has not used during the calendar year in which occurs the effective date of
termination, which amount shall be determined based on a daily rate of the
Executive’s Base Salary assuming two hundred sixty (260) business days in such
year;

(ii)

any unvested stock options held by the Executive on the effective date of
termination shall become fully vested and exercisable as of the effective date
of termination; and

(iii)

to the extent permitted by the applicable policies and contracts or applicable
law (including the COBRA continuation coverage requirements under Code Section
4980B), continuation of health insurance benefits made available to the
Executive by the Employer for twelve (12) months following termination at the
same level and in the same manner as

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provided immediately prior to the Executive’s termination of employment.  The
cost of such insurance coverage shall be allocated among the Employer and the
Executive in the same manner as prior to the termination and any costs borne by
the Executive shall be paid to the Employer in advance at the beginning of each
month.  In the event of the Executive’s death or subsequent employment by
another employer who maintains health insurance coverage for its employees, the
coverage provided under this Subsection (iii) shall cease.

The Executive’s continued employment for six (6) months following any act or
failure to act constituting Cause hereunder without delivery of written notice
shall constitute consent to, and a waiver of the Executive’s rights under this
subsection with respect to, such act or failure to act.

(b)

Without Cause or upon the Disability of the Executive, provided that the
Executive shall give the Employer sixty (60) days’ prior written notice of his
intent to terminate, in which event the Employer shall have no further
obligation to the Executive except for payment of any Base Salary due and owing
under Section 4.1 on the effective date of termination; any annual bonus earned
under Section 4.2 for a performance period ending prior to the effective date of
termination which has not yet been paid; and reimbursement under Section 4.5 of
expenses incurred as of the effective date of termination.

3.2.3

At any time upon mutual, written agreement of the parties, in which event the
Employer shall have no further obligation to the Executive except for payment of
any Base Salary due and owing under Section 4.1 on the effective date of
termination and reimbursement under Section 4.5 of expenses incurred as of the
effective date of termination.

3.2.4

Upon expiration of the Term as provided in Section 3.1, in which event the
Employer shall have no further obligation to the Executive except for payment of
any Base Salary due and owing under Section 4.1 on the last day of the Term then
in effect and reimbursement under Section 4.5 of expenses incurred as of the
last day of the Term then in effect.

3.2.5

Notwithstanding anything in this Agreement to the contrary, the Term shall end
automatically upon the Executive’s death, in which event the Employer shall have
no further obligation to the Executive’s estate except for payment of any Base
Salary due and owing under Section 4.1 on the effective date of termination; any
annual bonus earned under Section 4.2 for a performance period ending prior to
the effective date of termination which has not yet been paid; and reimbursement
under Section 4.5 of expenses incurred as of the effective date of termination.
 In addition, any unvested stock options held by the Executive on his date of
death shall become fully vested and exercisable as of the Executive’s date of
death.

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3.3

Change of Control.  If, within six (6) months following the effective date of a
Change of Control or three (3) months following the first anniversary of the
effective date of a Change of Control, the Executive terminates his employment
with the Employer under this Agreement for Cause or the Employer terminates the
Executive’s employment without Cause, the Executive, or in the event of his
subsequent death, his designated beneficiaries or his estate, as the case may
be, shall receive, as liquidated damages, in lieu of all other claims, a lump
sum payment equal to sum of:

3.3.1

The greater of (i) the sum of his Base Salary which would be payable for the
remainder of the Term and a pro-rata portion of any annual bonus that would be
paid for the calendar year in which occurs the effective date of termination as
determined in accordance with Section 3.4.1; or (ii) one and one-half (1½) times
the sum of his Base Salary then in effect and a pro-rata portion of any annual
bonus that would be paid for the calendar year in which occurs the effective
date of termination as determined in accordance with Section 3.4.1; and

3.3.2

A cash payment for each vacation day which the Executive has not used during the
calendar year in which occurs the effective date of termination which amount
shall be determined based on a daily rate of the Executive’s Base Salary then in
effect assuming two hundred sixty (260) business days in such year.  

In addition to the payment described in Sections 3.3.1 and 3.3.2, any unvested
stock options held by the Executive shall become fully vested as of the
effective date of the Change of Control, and to the extent permitted by the
applicable plan or contract or applicable law (including the COBRA continuation
coverage requirements under Code Section 4980B), the Executive shall be entitled
to continuation of health insurance benefits then made available to the
Executive by the Employer for twelve (12) months following termination at the
same level and in the same manner as provided immediately prior to termination
of the Executive’s employment.  The cost of such insurance coverage shall be
allocated among the Employer and the Executive in the same manner as prior to
the termination and any costs borne by the Executive shall be paid to the
Employer in advance at the beginning of each month.  In the event of the
Executive’s death or subsequent employment by another employer who provides
health insurance coverage for its employees, the coverage provided under this
Section 3.3 shall cease.  Notwithstanding any provision in this Agreement, if
the Executive may exercise his right to terminate employment under this Section
3.3 or under Section 3.2.2(a), the Executive may choose which provision shall be
applicable.  

Notwithstanding any other provision of this Agreement to the contrary, if the
aggregate of the payments provided for in this Agreement and the other payments
and benefits which the Executive has the right to receive from the Employer
which are contingent upon a change in ownership or effective control of the
Employer or the Company or in the ownership of a substantial portion of the
assets of the Employer or the Company (the “Total Payments”) would constitute a
“parachute payment,” as defined in Section 280G(b)(2) of the Internal Revenue
Code of 1986, as amended (the “Code”), the Executive shall receive the Total
Payments unless the (a) after-tax amount that would be retained by the Executive
(after taking into account all federal, state and local income taxes payable by
the Executive and the amount of any excise taxes payable by the Executive under
Section 4999 of the Code that would be payable by the

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Executive (the “Excise Taxes”)) if the Executive were to receive the Total
Payments has a lesser aggregate value than (b) the after-tax amount that would
be retained by the Executive (after taking into account all federal, state and
local income taxes payable by the Executive) if the Executive were to receive
the Total Payments reduced to the largest amount as would result in no portion
of the Total Payments being subject to the Excise Taxes (the “Reduced
Payments”), in which case the Executive shall be entitled only to the Reduced
Payments.  If the Executive is to receive the Reduced Payments, the Executive
shall be entitled to determine which of the Total Payments, and the relative
portions of each, are to be reduced.  

3.4

Effect of Termination.  

3.4.1

Upon termination of the Executive’s employment hereunder for any reason, the
Employer shall have no further obligation to the Executive or the Executive’s
estate with respect to this Agreement, except for the payment of any Base Salary
and annual bonus due and owing under Sections 4.1 and 4.2 (unless upon a
termination by the Employer with Cause pursuant to Section 3.2.1(a)),
respectively, on the effective date of termination; reimbursement under Section
4.5 of expenses incurred as of the effective date of termination of employment;
and any payments set forth in Sections 3.2.1(b) or (c), Section 3.2.2(a), or
Section 3.3, as applicable.  

For purposes of Section 3.2.1(b), Section 3.2.2(a) and Section 3.3, the pro-rata
portion of the annual bonus for the performance period during which the
effective date of termination falls shall be determined in accordance with the
terms and conditions of the Mountain State Bank Annual Cash Incentive Plan (or
any successor program).  A determination as to the Employer’s satisfaction of
the performance conditions applicable to the Executive’s receipt of an annual
bonus under the Mountain State Bank Annual Cash Incentive Plan shall be made
based on a forecast of the annual performance results at the end of the
performance period (annualizing the Employer’s financial information as of the
effective date of termination).  In annualizing any mid-year results, the Board
of Directors of the Employer may make any reasonable assumptions it deems
necessary or appropriate to prepare the forecast.  The pro-rata portion of any
bonus which would have been payable at the end of the performance period shall
be equal to the annual bonus amount multiplied by a fraction, the numerator of
which is the number of full months in the performance period prior to the
effective date of termination and the denominator of which is twelve (12).

3.4.2

As a condition to the Employer’s payment of any amount in connection with a
termination of the Executive’s employment, the Executive agrees to execute a
release in such form as is acceptable to the Employer.  The Employer reserves
the right to withhold payment of any amounts payable upon termination until the
revocation period associated with such release expires (generally, seven days
from the date the release is executed).  

3.4.3

Payment of any amount in connection with a termination of the Executive’s
employment shall occur within thirty (30) days following the effective date of
termination (except with respect to Section 3.2.1(c) which shall be paid as a
salary continuation

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payment).  Notwithstanding any provision in this Agreement to the contrary, any
payments otherwise payable to the Executive within the first six (6) months
following the effective date of his termination of employment shall be suspended
until the sixth-month anniversary of the Executive’s termination of employment
if, immediately prior to the Executive’s termination of employment, the
Executive is determined to be a “specified employee” of the Employer within the
meaning of Code Section 409A(a)(2)(B)(i).

4.

Compensation.  The Executive shall receive the following salary and benefits
during the Term, except as otherwise provided below:

4.1

Base Salary.  The Executive shall be compensated at a base rate of $130,000 per
year (the “Base Salary”).  The Executive’s Base Salary shall be reviewed by the
Board of Directors of the Employer at least annually, and the Executive shall be
entitled to receive annually an increase in such amount, if any, as may be
determined by the Board of Directors of the Employer based on its evaluation of
the Executive’s performance.  Base Salary shall not be reduced after any such
increase and the term “Base Salary” as used in this Agreement shall refer to
Base Salary as so increased.  Base Salary shall be payable in accordance with
the Employer’s normal payroll practices.

4.2

Incentive Compensation.  The Executive shall be entitled to annual bonus
compensation in accordance with the terms of the Mountain State Bank Annual Cash
Incentive Plan adopted by the Employer effective as of January 1, 2005.

4.3

Stock Options.  The Executive shall be eligible to receive stock options at such
times and in such amounts as may be determined in the discretion of the
Company’s Board of Directors.

4.4

Automobile.  The Employer will provide the Executive with an automobile of a
make and model which is commensurate with the Executive’s position and approved
by the Employer.  The Employer will reimburse the Executive for expenses
associated with the operation, maintenance and repair of the automobile.  Not
less frequently than once annually, the Executive will make a good faith
allocation between business and personal use of such vehicle as required by the
Internal Revenue Service guidelines.

4.5

Business Expenses; Memberships.  The Employer specifically agrees to reimburse
the Executive for:

(a)

reasonable and necessary business (including travel) expenses incurred by him in
the performance of his duties hereunder, as approved by the President and Chief
Executive Officer of the Employer; and

(b)

the reasonable dues and business related expenditures associated with membership
in country club(s), civic association(s), as selected by the Executive and
approved by the President and Chief Executive Officer of the Employer, and in
professional association(s) which are commensurate with the Executive’s
position;

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provided, however, that the Executive shall, as a condition of reimbursement,
submit verification of the nature and amount of such expenses in accordance with
reimbursement policies from time to time adopted by the Employer and in
sufficient detail to comply with rules and regulations promulgated by the
Internal Revenue Service.  The Executive acknowledges that the Employer makes no
representation with respect to the taxability or nontaxability of the benefits
provided under this Section.

4.6

Vacation.  The Executive shall be entitled to twenty (20) days of vacation in
each successive twelve-month period during the Term, for which his compensation
shall be paid in full.  In the event the Executive does not use all of his
available vacation days during each twelve-month period during the Term, a
maximum of ten (10) unused vacation days may be transferred to the next
succeeding calendar year.  In no event shall the Executive be entitled to more
than thirty (30) vacation days in any one twelve-month period during the Term.

4.7

Benefits.  In addition to the benefits specifically described in this Agreement,
the Executive shall be entitled to such benefits as may be available from time
to time to executives of the Employer similarly situated to the Executive.  All
such benefits shall be awarded and administered in accordance with the
Employer’s standard policies and practices.  Such benefits may include, by way
of example only, profit-sharing plans, retirement or investment funds, dental,
health, life and disability insurance benefits and such other benefits as the
Employer deems appropriate.  

4.8

Withholding.  The Employer may deduct from each payment of compensation
hereunder all amounts required to be deducted and withheld in accordance with
applicable federal and state income tax, FICA and other withholding
requirements.  

5.

Employer Information.

5.1

Ownership of Employer Information.   All Employer Information received or
developed by the Executive while employed by the Employer will remain the sole
and exclusive property of the Employer.

5.2

Obligations of the Executive.  The Executive agrees:

(a)

to hold Employer Information in strictest confidence;

(b)

not to use, duplicate, reproduce, distribute, disclose or otherwise disseminate
Employer Information or any physical embodiments of Employer Information; and

(c)

in any event, not to take any action causing or fail to take any action
necessary in order to prevent any Employer Information from losing its character
or ceasing to qualify as Confidential Information or a Trade Secret.  

In the event that the Executive is required by law to disclose any Employer
Information, the Executive will not make such disclosure unless (and then only
to the extent that) the Executive has

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been advised by independent legal counsel that such disclosure is required by
law and then only after prior written notice is given to the Employer when the
Executive becomes aware that such disclosure has been requested and is required
by law.  With respect to Confidential Information, this Section 5 shall survive
for a period of twelve (12) months following termination of this Agreement for
any reason, and shall survive termination of this Agreement for any reason for
so long as is permitted by applicable law, with respect to Trade Secrets.

5.3

Delivery upon Request or Termination.  Upon request by the Employer, and in any
event upon termination of his employment with the Employer, the Executive will
promptly deliver to the Employer all property belonging to the Employer,
including, without limitation, all Employer Information then in his possession
or control.  

6.

Non-Competition.  The Executive agrees that during his employment by the
Employer hereunder and, in the event of his termination:

·

by the Employer without Cause pursuant to Section 3.2.1(b);

·

by the Executive for Cause pursuant to Section 3.2.2(a);

·

by the Executive without Cause pursuant to Section 3.2.2(b), or

·

by the Employer or the Executive in connection with a Change of Control pursuant
to Section 3.3,

for a period of twelve (12) months thereafter, he will not (except on behalf of
or with the prior written consent of the Employer), within the Area, either
directly or indirectly, on his own behalf or in the service of or on behalf of
others, as an executive employee or in any other capacity which involves duties
and responsibilities similar to those undertaken for the Employer (including as
an organizer, director or proposed executive officer of a new financial
institution), engage in any business which is the same as or essentially the
same as the Business of the Employer.  

7.

Non-Solicitation of Customers.  The Executive agrees that during his employment
by the Employer hereunder and, in the event of his termination:

·

by the Employer without Cause pursuant to Section 3.2.1(b);

·

by the Executive for Cause pursuant to Section 3.2.2(a);

·

by the Executive without Cause pursuant to Section 3.2.2(b), or

·

by the Employer or the Executive in connection with a Change of Control pursuant
to Section 3.3,

for a period of twelve (12) months thereafter, he will not (except on behalf of
or with the prior written consent of the Employer), within the Area, on his own
behalf or in the service of or on behalf of others, solicit, divert or
appropriate or attempt to solicit, divert or appropriate, any business from any
of the Employer’s customers, including prospective customers actively sought by
the Employer, with whom the Executive has or had material contact during the
last two (2) years of his employment, for purposes of providing products or
services that are competitive with those provided by the Employer.

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8.

Non-Solicitation of Employees.  The Executive agrees that during his employment
by the Employer hereunder and, in the event of his termination:

·

by the Employer without Cause pursuant to Section 3.2.1(b);

·

by the Executive for Cause pursuant to Section 3.2.2(a);

·

by the Executive without Cause pursuant to Section 3.2.2(b), or

·

by the Employer or the Executive in connection with a Change of Control pursuant
to Section 3.3,

for a period of twelve (12) months thereafter, he will not, within the Area, on
his own behalf or in the service of or on behalf of others, solicit, recruit or
hire away or attempt to solicit, recruit or hire away, any employee of the
Employer or its Affiliates to another person or entity providing products or
services that are competitive with the Business of the Employer, whether or not:

·

such employee is a full-time employee or a temporary employee of the Employer or
its Affiliates,

·

such employment is pursuant to written agreement, and

·

such employment is for a determined period or is at will.

9.

Remedies.  The Executive agrees that the covenants contained in Sections 5
through 8 of this Agreement are of the essence of this Agreement; that each of
the covenants is reasonable and necessary to protect the business, interests and
properties of the Employer, and that irreparable loss and damage will be
suffered by the Employer should he breach any of the covenants.  Therefore, the
Executive agrees and consents that, in addition to all the remedies provided by
law or in equity, the Employer shall be entitled to a temporary restraining
order and temporary and permanent injunctions to prevent a breach or
contemplated breach of any of the covenants.  The Employer and the Executive
agree that all remedies available to the Employer or the Executive, as
applicable, shall be cumulative.

10.

Severability.  The parties agree that each of the provisions included in this
Agreement is separate, distinct and severable from the other provisions of this
Agreement and that the invalidity or unenforceability of any Agreement provision
shall not affect the validity or enforceability of any other provision of this
Agreement.  Further, if any provision of this Agreement is ruled invalid or
unenforceable by a court of competent jurisdiction because of a conflict between
the provision and any applicable law or public policy, the provision shall be
redrawn to make the provision consistent with and valid and enforceable under
the law or public policy.

11.

No Set-Off by the Executive.  The existence of any claim, demand, action or
cause of action by the Executive against the Employer, or any Affiliate of the
Employer, whether predicated upon this Agreement or otherwise, shall not
constitute a defense to the enforcement by the Employer of any of its rights
hereunder.

12.

Notice.  All notices and other communications required or permitted under this
Agreement shall be in writing and shall be delivered by hand or, if mailed,
shall be sent via the United States Postal Service, certified mail, return
receipt requested, or by overnight courier.  All notices hereunder may be
delivered by hand or overnight courier, in which event the notice shall be

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deemed effective when delivered. All notices and other communications under this
Agreement shall be given to the parties hereto at the following addresses:

(i)

If to the Employer, to it at:

Highway 53, East

Dawsonville, Georgia  30534

Attention: President and Chief Executive Officer

(ii)

If to the Executive, to him at:

3715 High Gables East

Cumming, GA 30041

Any party hereto may change his or its address by advising the others, in
writing, of such change of address.

13.

Assignment.  This Agreement is generally not assignable by the Employer except
that the rights and obligations of the Employer under this Agreement shall inure
to the benefit of and shall be binding upon the successors and assigns of the
Employer.  The Agreement is a personal contract and the rights and interests of
the Executive may not be assigned by him.  This Agreement shall inure to the
benefit of and be enforceable by the Executive and his personal or legal
representatives, executors, administrators, successors, heirs, distributes,
devisees and legatees.

14.

Waiver.  A waiver by one party to this Agreement of any breach of this Agreement
by the other party to this Agreement shall not be effective unless in writing,
and no waiver shall operate or be construed as a waiver of the same or another
breach on a subsequent occasion.

15.

Arbitration.  Except for matters contemplated by Section 17 below, any
controversy or claim arising out of or relating to this contract, or the breach
thereof, shall be settled by binding arbitration in accordance with the
Commercial Arbitration Rules of the American Arbitration Association.  Judgment
upon the award rendered by the arbitrator may be entered only in the state court
of Dawson County, Georgia or the federal court for the Northern District of
Georgia.  The Employer and the Executive agree to share equally the fees and
expenses associated with the arbitration proceedings.  Executive must initial
here: _____

16.

Attorneys’ Fees.  In the event that the parties have complied with this
Agreement with respect to arbitration of disputes and litigation ensues between
the parties concerning the enforcement of an arbitration award, the party
prevailing in such litigation shall be entitled to receive from the other party
all reasonable costs and expenses, including without limitation attorneys’ fees,
incurred by the prevailing party in connection with such litigation, and the
other party shall pay such costs and expenses to the prevailing party promptly
upon demand by the prevailing party.

17.

Applicable Law and Choice of Forum.  This Agreement shall be construed and
enforced under and in accordance with the laws of the State of Georgia.  The
parties agree that the state

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court of Dawson County, Georgia or the federal court of the Northern District of
Georgia shall have exclusive jurisdiction of any case or controversy arising
under or in connection with Sections 5 through 9 of this Agreement shall be a
proper forum in which to adjudicate such case or controversy.  The parties
consent and waive any objection to the jurisdiction or venue of such courts.

18.

Interpretation.  Words importing any gender include all genders.  Words
importing the singular form shall include the plural and vice versa.  The terms
“herein,” “hereunder,” “hereby,” “hereto,” “hereof” and any similar terms refer
to this Agreement.  Any captions, titles or headings preceding the text of any
article, section or subsection herein are solely for convenience of reference
and shall not constitute part of this Agreement or affect its meaning,
construction or effect.

19.

Entire Agreement.  This Agreement embodies the entire and final agreement of the
parties on the subject matter stated in this Agreement.  No amendment or
modification of this Agreement shall be valid or binding upon the Employer or
the Executive unless made in writing and signed by both parties.  All prior
understandings and agreements relating to the subject matter of this Agreement
are hereby expressly terminated.

20.

Rights of Third Parties.  Nothing herein expressed is intended to or shall be
construed to confer upon or give to any person, firm or other entity, other than
the parties hereto and their permitted assigns, any rights or remedies under or
by reason of this Agreement.

21.

Survival.  The obligations of the Executive pursuant to Sections 5, 6, 7, 8 and
9 shall survive the termination of the employment of the Executive hereunder for
the period designated under each of those respective Sections.

IN WITNESS WHEREOF, the Employer and the Executive have executed and delivered
this Agreement as of the date first shown above.  

THE EMPLOYER:

MOUNTAIN STATE BANK

By:  s/John L. Lewis

        John L. Lewis

        President and Chief Executive Officer

THE EXECUTIVE:

s/Spencer Strickland

SPENCER STRICKLAND

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Exhibit A

Duties of the Executive

[insert duties]

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