Exhibit 10.1
CAPITAL BANK CORPORATION
EQUITY INCENTIVE PLAN

STOCK AWARD AGREEMENT

THIS STOCK AWARD AGREEMENT (this “Agreement”) is dated as of [date] (the “Grant
Date”) by and between Capital Bank Corporation, a North Carolina corporation
(the “Corporation”), and [participant name] (the “Participant”) pursuant to the
Capital Bank Corporation Equity Incentive Plan (the “Plan”).  All capitalized
terms not otherwise defined herein shall have the meanings set forth in the
Plan.

RECITALS:

A.       Participant is an officer, employee or director of the Corporation and
the Corporation, in consideration of the Participant’s prior and future services
to the Corporation, considers it desirable to give Participant an added
incentive to advance the interests of the Corporation and its shareholders.

B.       The Corporation now desires to grant Participant shares of common stock
of the Corporation, no par value (the “Shares”) in the form of restricted stock,
pursuant to the terms and conditions of this Agreement and the Plan (the
“Restricted Stock”).

AGREEMENT:

NOW, THEREFORE, in consideration of the covenants hereinafter set forth, the
parties agree as follows:

1.       Grant of Restricted Stock.  The Corporation has granted Participant,
and Participant hereby accepts, [number] Shares of Restricted Stock, having a
fair market value (FMV) per Share of [price] on the Grant Date.  Pursuant to
Section 10 of the Plan, the Restricted Stock is granted as a restricted stock
award and Participant shall not be obligated to pay a purchase price for the
Shares.  The Restricted Stock shall be subject to the terms and conditions
stated in this Agreement and in the Plan.

2.       Period of Restriction.  Subject to Participant continuing to provide
continuous services to the Corporation, the restrictions set forth in this
Agreement with respect to the Restricted Stock shall lapse with respect to one
third (1/3) of the Shares on each of the first, second and third anniversaries
of the Grant Date, so that all the restrictions shall have lapsed three (3)
years from the Grant Date (the “Period of Restriction”).  Participant
acknowledges that prior to the expiration of the applicable portion of the
Period of Restriction, the Restricted Stock may not be sold, transferred,
pledged, assigned, encumbered, alienated, hypothecated or otherwise disposed of
(whether voluntarily or involuntarily or by operation of law by judgment, levy,
attachment, garnishment or any other legal or equitable proceedings (including
bankruptcy)).  Upon the expiration of the applicable portion of the Period of
Restriction, the restrictions set forth in this Agreement with respect to the
Restricted Stock initially subject to such expired Period of Restriction shall
lapse, except as may be provided in accordance with Section 9 hereof.

3.       Ownership.  Participant agrees that Participant’s ownership of the
Restricted Stock will be evidenced solely by a “book entry” (i.e., a
computerized or manual entry) in the records of the Corporation or its
designated stock transfer agent in Participant’s name.  Upon expiration of the
applicable portion of the Period of Restriction, the Corporation shall transfer
the vested shares to Participant.
 
 
4.
Termination.

 
 
  (a)    Death or Disability.  If Participant’s termination of employment or
other relationship with the Corporation is as a result of Participant’s death or
Disability (as defined in Participant’s employment agreement or, if Participant
has no employment agreement, within the meaning of Section 22(e)(3) of the
Internal Revenue Code of 1986, as amended (the “Code”)), then the Period of
Restriction shall immediately lapse, causing any restrictions which would
otherwise remain on the Restricted Stock to immediately lapse.

 
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     (b)            Other Terminations.  If Participant’s Termination is by the
Corporation or an affiliate of the Corporation or by Participant for any reason
other than death or Disability, then all Restricted Stock for which the Period
of Restriction had not lapsed prior to the date of such Termination shall be
immediately forfeited.

 
5.       Taxes and Withholdings.  Upon the expiration of the applicable portion
of the Period of Restriction or such earlier dates as Participant elects
pursuant to Section 83(b) of the Code, or as of which the value of any Shares of
Restricted Stock first becomes includible in Participant’s gross income for
income tax purposes, Participant shall notify the Corporation if Participant
wishes to pay the Corporation in cash, check or with shares of Corporation
common stock already owned for the satisfaction of any taxes of any kind
required by law to be withheld with respect to such Shares; provided, however,
that pursuant to any procedures, and subject to any limitations as the
Compensation / Human Resources Committee of the Board of Directors of the
Corporation (the “Committee”) may prescribe and subject to applicable law, if
Participant does not notify the Corporation in writing at least fourteen (14)
days prior to the applicable lapse of the Period of Restriction, then
Participant will satisfy such withholding obligations by withholding Shares
otherwise deliverable to Participant pursuant to the Restricted Stock (provided,
however, that the amount of any Shares so withheld shall not exceed the amount
necessary to satisfy required Federal, state, local and non-United States
withholding obligations using the minimum statutory withholding rates for
Federal, state, local and/or non-U.S. tax purposes, including payroll taxes,
that are applicable to supplemental taxable income). Any such election made by
Participant must be irrevocable, made in writing, signed by Participant, and
shall be subject to any restrictions or limitations that the Committee, in its
sole discretion, deems appropriate.  In the event that the Participant elects
immediate Federal income taxation with respect to all or any portion of this
award of Restricted Stock pursuant to Section 83(b) of the Code, Participant
agrees to deliver a copy of such election to the Corporation within ten (10)
days after filing such election with the Internal Revenue Service.

6.       Rights as a Shareholder.  Participant shall have all rights of a
shareholder (including, without limitation, dividend and voting rights) with
respect to the Restricted Stock, for record dates occurring on or after the
Grant Date and prior to the date any such Shares of Restricted Stock are
forfeited in accordance with this Agreement, except that any dividends or
distributions paid in Shares or other securities (including, without limitation,
any change in the shares of Restricted Stock pursuant to Section 6 of the Plan)
with respect to the Restricted Stock shall, during the Period of Restriction, be
deposited with the Corporation or any holder appointed pursuant to Section 3
hereof, together with a stock power endorsed in blank or other appropriate
instrument of transfer, or credited to Participant’s book-entry account
established under Section 3 hereof, as applicable, and shall be subject to the
same restrictions (including, without limitation, the Period of Restriction) as
such Restricted Stock and otherwise considered to be such Restricted Stock for
all purposes hereunder.

7.       No Right to Continued Employment.  Neither the Restricted Stock nor any
terms contained in this Agreement shall confer upon Participant any express or
implied right to be retained in the employment or service of the Corporation or
any affiliate for any period, nor restrict in anyway the right of the
Corporation, which right is hereby expressly reserved, to terminate
Participant’s employment or service at any time for any reason.  Participant
acknowledges and agrees that any right to have restrictions on the Restricted
Stock lapse is earned only by continuing in the service of the Corporation or an
affiliate at the will of the Corporation or such affiliate, or satisfaction of
any other applicable terms and conditions contained in the Plan and this
Agreement, and not through the act of being hired, being granted the Restricted
Stock or acquiring Shares hereunder.

8.       The Plan.  This Agreement is subject to all the terms, provisions and
conditions of the Plan which are incorporated herein by reference, and to such
requirements as may from time to time be adopted by the Committee.  In the event
of any conflict between the provisions of the Plan and this Agreement, the
provisions of the Plan shall control, and this Agreement shall be deemed to be
modified accordingly.  A copy of the Plan is available to Participant at the
Corporation’s principal executive offices upon request and without charge.

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    9.       Compliance with Laws and Regulations.

 
  (a)    The Restricted Stock and the obligation of the Corporation to sell and
deliver Shares hereunder shall be subject in all respects to (i) all applicable
Federal and state laws, rules and regulations and (ii) any registration,
qualification, approvals or other requirements imposed by any government or
regulatory agency or body which the Committee shall, in its discretion,
determine to be necessary or applicable. Moreover, the Corporation shall not
deliver any certificates for Shares to Participant or any other person pursuant
to this Agreement if doing so would be contrary to applicable law. If at any
time the Corporation determines, in its discretion, that the listing,
registration or qualification of Shares upon any national securities exchange or
under any state or Federal law, or the consent or approval of any governmental
regulatory body, is necessary or desirable, the Corporation shall not be
required to deliver any certificates for Shares to Participant or any other
person pursuant to this Agreement unless and until such listing, registration,
qualification, consent or approval has been effected or obtained, or otherwise
provided for, free of any conditions not acceptable to the Corporation.

 
  (b)    The Shares received upon the expiration of the applicable portion of
the Period of Restriction shall have been registered under the Securities Act of
1933, as amended (“Securities Act”).  If Participant is an “affiliate” of the
Corporation, as that term is defined in Rule 144 under the Securities Act (“Rule
144”), Participant may not sell the Shares received except in compliance with
Rule 144.  Certificates representing Shares issued to an “affiliate” of the
Corporation may bear a legend setting forth such restrictions on the disposition
or transfer of the Shares as the Corporation deems appropriate to comply with
Federal and state securities laws.

 
  (c)    If, at any time, the Shares are not registered under the Securities
Act, and/or there is no current prospectus in effect under the Securities Act
with respect to the Shares, Participant may be required to execute, prior to the
delivery of any Shares to Participant by the Corporation pursuant to this
Agreement, an agreement (in such form as the Corporation may specify) in which
Participant represents and warrants that Participant is purchasing or acquiring
the shares acquired under this Agreement for Participant’s own account, for
investment only and not with a view to the sale or distribution thereof, and
represents and agrees that any subsequent offer for sale or distribution of any
kind of such Shares shall be made only pursuant to either (i) a registration
statement on an appropriate form under the Securities Act, which registration
statement has become effective and is current with regard to the Shares being
offered or sold, or (ii) a specific exemption from the registration requirements
of the Securities Act, but in claiming such exemption Participant shall, prior
to any offer for sale of such Shares, obtain a prior favorable written opinion,
in form and substance satisfactory to the Corporation, from counsel for or
approved by the Corporation, as to the applicability of such exemption thereto.

10.            Notices.  All notices by Participant or Participant’s assignees
shall be addressed to Capital Bank Corporation, 333 Fayetteville Street,
Raleigh, North Carolina 27601, Attention: Human Resources, or such other address
as the Corporation may from time to time specify.  All notices to Participant
shall be addressed to Participant at Participant’s address in the Corporation’s
records.

11.            Other Plans.  Participant acknowledges that any income derived
from the Restricted Stock shall not affect Participant’s participation in, or
benefits under, any other benefit plan or other contract or arrangement
maintained by the Corporation or any Affiliate.

12.            Governing Law.  This Agreement shall be construed under and
governed by the laws of the State of North Carolina without regard to the
conflict of law provisions thereof.

13.            Counterparts.  This Agreement may be executed in counterparts,
each of which shall be deemed an original and both of which together shall be
deemed one Agreement.

[signature page follows]

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

ATTEST
 
CAPITAL BANK CORPORATION
  
 
  
     
By: 
 
By: 
Secretary
 
Chief Executive Officer
           
[CORPORATE SEAL]
 
PARTICIPANT
                     
Signature

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