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EXECUTIVE SALARY CONTINUATION AGREEMENT THAT
SUPERSEDES AND REPLACES THE EXECUTIVE
SUPPLEMENTAL RETIREMENT PLAN EXECUTIVE
AGREEMENT DATED SEPTEMBER 26, 2002
 
 
THIS AGREEMENT, made and entered into this _______ day of ____________, 2006, by
and between Peachtree Bank, a bank organized and existing under the laws of the
State of Alabama (hereinafter referred to as the “Bank”), and Harvey N. Clapp,
an Executive of the Bank (hereinafter referred to as the “Executive”).

WHEREAS, the Bank is a wholly owned subsidiary of Maplesville Bancorp, an
Alabama corporation (hereinafter referred to as “Bancorp”);

WHEREAS, the Bank and the Executive are parties to an Executive Supplemental
Retirement Plan Executive Agreement dated the 26th day of September, 2002,
between Peachtree Bank and Harvey N. Clapp that provides for the payment of
certain benefits. This Executive Salary Continuation Agreement that supersedes
and replaces the Executive Supplemental Retirement Plan Executive Agreement
dated September 26, 2002, shall bring the Executive Supplemental Retirement Plan
Executive Agreement dated September 26, 2002, into compliance with Internal
Revenue Code §409A enacted on October 22, 2004. The benefits provided hereunder
shall supersede and replace the existing Executive Supplemental Retirement Plan
Executive Agreement and the benefits provided thereby;

WHEREAS, the Executive has been and continues to be a valued Executive of the
Bank, and is now employed with the Bank;

WHEREAS, it is the consensus of the Board of Directors (hereinafter referred to
as the “Board”) that the Executive’s employment with the Bank in the past has
been of exceptional merit and has constituted an invaluable contribution to the
general welfare of the Bank in bringing the Bank to its present status of
operating efficiency and present position in its field of activity;

WHEREAS, the Executive’s experience, knowledge of the affairs of the Bank,
reputation, and contacts in the industry are so valuable that assurance of the
Executive’s continued employment is essential for the future growth and profits
of the Bank and it is in the best interest of the Bank to arrange terms of
continued employment for the Executive so as to reasonably assure the Executive
remains in the Bank’s employ during the Executive’s lifetime or until the age of
retirement;

WHEREAS, it is the desire of the Bank that the Executive’s employment be
retained as herein provided;

WHEREAS, the Executive is willing to continue in the employ of the Bank provided
the Bank agrees to pay the Executive or the Executive’s beneficiary(ies),
certain benefits in accordance with the terms and conditions hereinafter set
forth;

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ACCORDINGLY, it is the desire of the Bank and the Executive to enter into this
Agreement under which the Bank will agree to make certain payments to the
Executive at retirement or the Executive’s beneficiary(ies) in the event of the
Executive’s death pursuant to this Agreement;

FURTHERMORE, it is the intent of the parties hereto that this Executive Plan be
considered an unfunded arrangement maintained primarily to provide supplemental
retirement benefits for the Executive, and be considered a non-qualified benefit
plan for purposes of the Employee Retirement Income Security Act of 1974, as
amended (“ERISA”). The Executive is fully advised of the Bank’s financial status
and has had substantial input in the design and operation of this benefit plan;
and

THEREFORE, in consideration of past employment performance and employment to be
performed in the future as well as the mutual promises and covenants herein
contained it is agreed as follows:

I.
EFFECTIVE DATE

The Effective Date of this Agreement shall be January 1, 2006.

II.
EMPLOYMENT

The Bank agrees to employ the Executive in such capacity as the Bank may from
time to time determine. The Executive will continue in the employ of the Bank in
such capacity and with such duties and responsibilities as may be assigned to
him, and with such compensation as may be determined from time to time by the
Board of Directors of the Bank.

III.
FRINGE BENEFITS

The salary continuation benefits provided by this Agreement are granted by the
Bank as a fringe benefit to the Executive and are not part of any salary
reduction plan or an arrangement deferring a bonus or a salary increase. The
Executive has no option to take any current payment or bonus in lieu of these
salary continuation benefits except as set forth hereinafter.

IV.
DEFINITIONS

 
A.
Retirement Date:

If the Executive remains in the continuous employ of the Bank, the Executive
shall retire from active employment with the Bank on the Executive’s
sixty-second (62nd) birthday or such later date as the Executive may actually
retire.

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B.
Normal Retirement Age:

Normal Retirement Age shall mean the date on which the Executive attains age
sixty-two (62).

 
C.
Plan Year:

Any reference to “Plan Year” shall mean a calendar year from January 1st to
December 31st. In the year of implementation, the term “Plan Year” shall mean
the period from the effective date to December 31st of the year of the effective
date.

 
D.
Termination of Employment:

Termination of Employment shall mean voluntary resignation of employment by the
Executive or the Bank’s discharge of the Executive without cause (Subparagraph
IV [E]), prior to the Normal Retirement Age (Subparagraph IV [B]).

 
E.
Discharge for Cause:

The term “for cause” shall mean any of the following that result in an adverse
effect on the Bank: (i) gross negligence or gross neglect; (ii) the commission
of a felony or gross misdemeanor involving fraud or dishonesty; (iii) the
willful violation of any law, rule, or regulation (other than a traffic
violation or similar offense); (iv) an intentional failure to perform stated
duties (as long as such duties are consistent with his duties as of the date of
the Agreement, with such changes as the Executive may agree to); or (v) a breach
of fiduciary duty involving personal profit. If a dispute arises as to discharge
“for cause,” such dispute shall be resolved by arbitration as set forth in this
Executive Plan. In the alternative, if the Executive is permitted to resign due
to inappropriate conduct as defined above, the Board of Directors may vote to
deny all benefits. A majority decision by the Board of Directors is required for
forfeiture of the Executive’s benefits.

 
F.
Change of Control:

In accordance with Internal Revenue Code §409A, the Change of Control shall be
defined as the occurrence of any one of the following:

 
a.
the acquisition of more than fifty percent (50%) of the value orvoting power of
the Bank’s or Bancorp’s stock by a person or group;

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b.
the acquisition in a period of twelve (12) months or less of at least
thirty-five percent (35%) of the Bank’s or Bancorp’s stock by a person or group;

 
c.
the replacement of a majority of the Bank’s board in a period of twelve (12)
months or less by Directors who were not endorsed by a majority of the current
board members; or

 
d.
the acquisition in a period of twelve (12) months or less of forty percent (40%)
or more of the Bank’s or Bancorp’s assets by an unrelated entity.

For the purposes of this Agreement, transfers made on account of deaths or
gifts, transfers between family members or transfers to a qualified retirement
plan maintained by the Bank shall not be considered in determining whether there
has been a Change in Control.

 
G.
Disability:

An Executive is considered disabled if he or she is: [1] unable to engage in any
substantial gainful activity by reason of any medically determinable physical or
mental impairment which can be expected to result in death or can be expected to
last for a continuous period of not less than twelve (12) months; or [2] by
reason of any medically determinable physical or mental impairment which can be
expected to result in death or can be expected to last for a continuous period
of not less than twelve (12) months, receiving income replacement benefits for a
period of not less than three (3) months under an accident and health plan
covering the Executive of the Bank. If there is a dispute regarding whether the
Executive is disabled, such dispute shall be resolved by a physician mutually
selected by the Bank and the Executive and such resolution shall be binding upon
all parties to this Agreement.

V.
RETIREMENT BENEFIT AND POST-RETIREMENT DEATH BENEFIT

The Bank, commencing with the first day of the second month following the
Retirement Date (Subparagraph IV [A]), shall pay the Executive an annual benefit
equal Ninety-Five Thousand and 00/100th Dollars ($95,000.00). Said benefit shall
be paid in equal monthly installments (1/12th of the annual benefit) until the
death of the Executive. Upon the death of the Executive, if there is a balance
in the accrued liability retirement account, such balance shall be paid in one
(1) lump sum to the individual or individuals the Executive may have designated
in writing and filed with the Bank. In the absence of any effective beneficiary
designation, any such amount becoming due and payable upon the death of the
Executive shall be payable to the duly qualified executor or administrator of
the Executive’s estate. Said payment due hereunder shall be made the first day
of the second month following the decease of the Executive.

In accordance with the Internal Revenue Code §409A, if the Executive is a Key
Employee, and said Bank is publicly traded at the time of retirement, any such
benefit payment shall be withheld for six (6) months following such retirement.

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VI.
DEATH BENEFIT PRIOR TO RETIREMENT

In the event the Executive should die while actively employed by the Bank at any
time after the date of this Agreement but prior to the Executive attaining the
age of sixty-two (62) years (or such later date as may be agreed upon), the Bank
will pay the accrued balance on the date of death, of the Executive’s accrued
liability retirement account in one (1) lump sum, the first day of the second
month following the Executive’s death, to such individual or individuals as the
Executive may have designated in writing and filed with the Bank, at which time
this Agreement shall terminate. In the absence of any effective beneficiary
designation, any such amount becoming due and payable upon the death of the
Executive shall be payable to the duly qualified executor or administrator of
the Executive’s estate. Said payment due hereunder shall be made by the first
day of the second month following the decease of the Executive.

VII.
DISABILITY

In the event the Executive becomes disabled prior to the Executive’s Retirement
Date (Subparagraph IV [A]), and the Executive’s employment is terminated because
of such disability, he shall become one hundred percent (100%) vested in the
balance of the accrued liability retirement account. Said balance shall be paid
in a lump sum, without regard to the Executive’s Normal Retirement Age
(Subparagraph IV [B]), thirty (30) days following such termination of
employment.

VIII.
BENEFIT ACCOUNTING/ACCRUED LIABILITY RETIREMENT ACCOUNT

The Bank shall account for this benefit using the regulatory accounting
principles of the Bank’s primary federal regulator. The Bank shall establish an
accrued liability retirement account for the Executive into which appropriate
reserves shall be accrued.

IX.
VESTING

The Executive shall be one hundred percent (100%) vested in the accrued
liability retirement account.

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X.
TERMINATION OF EMPLOYMENT

Subject to Subparagraph IV (E), in the event that the employment of the
Executive shall terminate prior to Normal Retirement Age, as provided in
Subparagraph IV (B), by the Executive’s voluntary action, or by the Executive’s
discharge by the Bank without cause, then this Agreement shall terminate upon
the date of such termination of employment and the Bank shall pay to the
Executive an amount of money equal to balance of the Executive’s accrued
liability retirement account on the date of said termination, multiplied by the
Executive’s cumulative vested percentage (Paragraph IX). This compensation shall
be paid in one (1) lump sum the first day of the second month following said
Termination.

In accordance with Internal Revenue Code §409A, if the Executive is a Key
Employee, and said Bank is publicly traded at the time of termination of
employment, any such benefit payment shall be withheld for six (6) months
following such termination of employment.

In the event the Executive’s death should occur after such termination but prior
to the payment provided for in this Paragraph X, the balance shall be paid, in
one (1) lump sum to such individual or individuals as the Executive may have
designated in writing and filed with the Bank. In the absence of any effective
beneficiary designation, any such amount shall be payable to the duly qualified
executor or administrator of the Executive’s estate. Said payment due hereunder
shall be made the first day of the second month following the decease of the
Executive.

In the event the Executive shall be discharged for cause at any time in
accordance with Subparagraph IV (E), this Agreement shall terminate and all
benefits provided herein shall be forfeited.

XI.
CHANGE OF CONTROL

If the Executive subsequently suffers a Termination of Employment (voluntarily
or involuntarily), except for cause, anytime subsequent to a Change of Control
as defined in Subparagraph IV (F), then the Executive shall receive the benefits
in Paragraph V herein upon attaining Normal Retirement Age (Subparagraph IV
[B]), as if the Executive had been continuously employed by the Bank until the
Executive’s Normal Retirement Age. Said payment shall be made in accordance with
Internal Revenue Code §409A. The Executive will also remain eligible for all
promised death benefits in this Agreement. In addition, no sale, merger,
consolidation or conversion of the Bank or Bancorp shall take place unless the
new or surviving entity expressly acknowledges the obligations under this
Agreement and agrees to abide by its terms.

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XII.
RESTRICTIONS ON FUNDING

The Bank shall have no obligation to set aside, earmark or entrust any fund or
money with which to pay its obligations under this Executive Plan. The
Executive, their beneficiary(ies), or any successor in interest shall be and
remain simply a general creditor of the Bank in the same manner as any other
creditor having a general claim for matured and unpaid compensation.

The Bank reserves the absolute right, at its sole discretion, to either fund the
obligations undertaken by this Executive Plan or to refrain from funding the
same and to determine the extent, nature and method of such funding. Should the
Bank elect to fund this Executive Plan, in whole or in part, through the
purchase of life insurance, mutual funds, disability policies or annuities, the
Bank reserves the absolute right, in its sole discretion, to terminate such
funding at any time, in whole or in part. At no time shall any Executive be
deemed to have any lien, right, title or interest in any specific funding
investment or assets of the Bank.

If the Bank elects to invest in a life insurance, disability or annuity policy
on the life of the Executive, then the Executive shall assist the Bank by freely
submitting to a physical exam and supplying such additional information
necessary to obtain such insurance or annuities.

XIII.
MISCELLANEOUS

 
A.
Alienability and Assignment Prohibition:

Neither the Executive, nor the Executive’s surviving spouse, nor any other
beneficiary(ies) under this Executive Plan shall have any power or right to
transfer, assign, anticipate, hypothecate, mortgage, commute, modify or
otherwise encumber in advance any of the benefits payable hereunder nor shall
any of said benefits be subject to seizure for the payment of any debts,
judgments, alimony or separate maintenance owed by the Executive or the
Executive’s beneficiary(ies), nor be transferable by operation of law in the
event of bankruptcy, insolvency or otherwise. In the event the Executive or any
beneficiary attempts assignment, commutation, hypothecation, transfer or
disposal of the benefits hereunder, the Bank’s liabilities shall forthwith cease
and terminate.

 
B.
Binding Obligation of the Bank and any Successor in Interest:

Neither the Bank nor Bancorp shall merge or consolidate into or with another
bank or company or sell substantially all of either of its assets to another
bank, firm or person until such bank, firm or person expressly agree, in
writing, to assume and discharge the duties and obligations of the Bank under
this Executive Plan. This Executive Plan shall be binding upon the parties
hereto, their successors, beneficiaries, heirs and personal representatives.

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C.
Amendment or Revocation:

It is agreed by and between the parties hereto that, during the lifetime of the
Executive, this Executive Plan may be amended or revoked at any time or times,
in whole or in part, by the mutual written consent of the Executive and the
Bank.

 
D.
Gender:

Whenever in this Executive Plan words are used in the masculine or neuter
gender, they shall be read and construed as in the masculine, feminine or neuter
gender, whenever they should so apply.

 
E.
Effect on Other Bank Benefit Plans:

Nothing contained in this Executive Plan shall affect the right of the Executive
to participate in or be covered by any qualified or non-qualified pension,
profit-sharing, group, bonus or other supplemental compensation or fringe
benefit plan constituting a part of the Bank’s existing or future compensation
structure.

 
F.
Headings:

Headings and subheadings in this Executive Plan are inserted for reference and
convenience only and shall not be deemed a part of this Executive Plan.

 
G.
Applicable Law:

The laws of the State of Alabama shall govern the validity and interpretation of
this Agreement.

 
H.
Partial Invalidity:

If any term, provision, covenant, or condition of this Executive Plan is
determined by an arbitrator or a court, as the case may be, to be invalid, void,
or unenforceable, such determination shall not render any other term, provision,
covenant, or condition invalid, void, or unenforceable, and the Executive Plan
shall remain in full force and effect notwithstanding such partial invalidity.

 
I.
Not a Contract of Employment:

This Agreement shall not be deemed to constitute a contract of employment
between the parties hereto, nor shall any provision hereof restrict the right of
the Bank to discharge the Executive, or restrict the right of the Executive to
terminate employment.
 
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J.
Supersede and Replace Entire Agreement:

This Agreement shall supersede the Executive Supplemental Retirement Plan
Executive Agreement dated the 26th day of September, 2002, and shall replace the
entire agreement of the parties pertaining to this particular Executive Salary
Continuation Agreement.
 
XIV.
ADMINISTRATIVE AND CLAIMS PROVISION

 
A.
Plan Administrator:

The “Plan Administrator” of this Executive Plan shall be Peachtree Bank. As Plan
Administrator, the Bank shall be responsible for the management, control and
administration of the Executive Plan. The Plan Administrator may delegate to
others certain aspects of the management and operation responsibilities of the
Executive Plan including the employment of advisors and the delegation of
ministerial duties to qualified individuals.

 
B.
Claims Procedure:

 
a.
Filing a Claim for Benefits:

Any insured, beneficiary, or other individual, (“Claimant”) entitled to benefits
under this Executive Plan will file a claim request with the Plan Administrator.
The Plan Administrator will, upon written request of a Claimant, make available
copies of all forms and instructions necessary to file a claim for benefits or
advise the Claimant where such forms and instructions may be obtained. If the
claim relates to disability benefits, then the Plan Administrator shall
designate a sub-committee to conduct the initial review of the claim (and
applicable references below to the Plan Administrator shall mean such
sub-committee).

 
b.
Denial of Claim:

A claim for benefits under this Executive Plan will be denied if the Bank
determines that the Claimant is not entitled to receive benefits under the
Executive Plan. Notice of a denial shall be furnished the Claimant within a
reasonable period of time after receipt of the claim for benefits by the Plan
Administrator. This time period shall not exceed more than ninety (90) days
after the receipt of the properly submitted claim. In the event that the claim
for benefits pertains to disability, the Plan Administrator shall provide
written notice within forty-five (45) days. However, if the Plan Administrator
determines, in its discretion, that an extension of time for processing the
claim is required, such extension shall not exceed an additional ninety (90)
days. In the case of a claim for disability benefits, the forty-five (45) day
review period may be extended for up to thirty (30) days if necessary due to
circumstances beyond the Plan Administrator’s control, and for an additional
thirty (30) days, if necessary. Any extension notice shall indicate the special
circumstances requiring an extension of time and the date by which the Plan
Administrator expects to render the determination on review.

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c.
Content of Notice:

The Plan Administrator shall provide written notice to every Claimant who is
denied a claim for benefits which notice shall set forth the following:

 
(i.)
The specific reason or reasons for the denial;

 
(ii.)
Specific reference to pertinent Executive Plan provisions on which the denial is
based;

 
(iii.)
A description of any additional material or information necessary for the
Claimant to perfect the claim, and any explanation of why such material or
information is necessary; and

 
(iv.)
Any other information required by applicable regulations, including with respect
to disability benefits.

 
d.
Review Procedure:

The purpose of the Review Procedure is to provide a method by which a Claimant
may have a reasonable opportunity to appeal a denial of a claim to the Plan
Administrator for a full and fair review. The Claimant, or his duly authorized
representative, may:

 
(i.)
Request a review upon written application to the Plan Administrator. Application
for review must be made within sixty (60) days of receipt of written notice of
denial of claim. If the denial of claim pertains to disability, application for
review must be made within one hundred eighty (180) days of receipt of written
notice of the denial of claim;

 
(ii.)
Review and copy (free of charge) pertinent Executive Plan documents, records and
other information relevant to the Claimant’s claim for benefits;

 
 
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(iii.)
Submit issues and concerns in writing, as well as documents, records, and other
information relating to the claim.

 

 
e.
Decision on Review:

A decision on review of a denied claim shall be made in the following manner:

 
(i.)
The Plan Administrator may, in its sole discretion, hold a hearing on the denied
claim. If the Claimant’s initial claim is for disability benefits, any review of
a denied claim shall be made by members of the Plan Administrator other than the
original decision maker(s) and such person(s) shall not be a subordinate of the
original decision maker(s). The decision on review shall be made promptly, but
generally not later than sixty (60) days after receipt of the application for
review. In the event that the denied claim pertains to disability, such decision
shall not be made later than fortyfive (45) days after receipt of the
application for review. If the Plan Administrator determines that an extension
of time for processing is required, written notice of the extension shall be
furnished to the Claimant prior to the termination of the initial sixty (60) day
period. In no event shall the extension exceed a period of sixty (60) days from
the end of the initial period. In the event the denied claim pertains to
disability, written notice of such extension shall be furnished to the Claimant
prior to the termination of the initial forty-five (45) day period. In no event
shall the extension exceed a period of thirty (30) days from the end of the
initial period. The extension notice shall indicate the special circumstances
requiring an extension of time and the date by which the Plan Administrator
expects to render the determination on review.

 
(ii.)
The decision on review shall be in writing and shall include specific reasons
for the decision written in an understandable manner with specific references to
the pertinent Executive Plan provisions upon which the decision is based.

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(iii.)
The review will take into account all comments, documents, records and other
information submitted by the Claimant relating to the claim without regard to
whether such information was submitted or considered in the initial benefit
determination. Additional considerations shall be required in the case of a
claim for disability benefits. For example, the claim will be reviewed without
deference to the initial adverse benefits determination and, if the initial
adverse benefit determination was based in whole or in part on a medical
judgment, the Plan Administrator will consult with a health care professional
with appropriate training and experience in the field of medicine involving the
medical judgment. The health care professional who is consulted on appeal will
not be the same individual who was consulted during the initial determination or
the subordinate of such individual. If the Plan Administrator obtained the
advice of medical or vocational experts in making the initial adverse benefits
determination (regardless of whether the advice was relied upon), the Plan
Administrator will identify such experts.

 
(iv.)
The decision on review will include a statement that the Claimant is entitled to
receive, upon request and free of charge, reasonable access to, and copies of,
all documents, records or other information relevant to the Claimant’s claim for
benefits.

 
f.
Exhaustion of Remedies:

A Claimant must follow the claims review procedures under this Executive Plan
and exhaust his or her administrative remedies before taking any further action
with respect to a claim for benefits.

 
C.
Arbitration:

If claimants continue to dispute the benefit denial based upon completed
performance of this Executive Plan or the meaning and effect of the terms and
conditions thereof, then claimants may submit the dispute to an Arbitrator for
final arbitration. The Arbitrator shall be selected by mutual agreement of the
Bank and the claimants. The Arbitrator shall operate under any generally
recognized set of arbitration rules. The parties hereto agree that they and
their heirs, personal representatives, successors and assigns shall be bound by
the decision of such Arbitrator with respect to any controversy properly
submitted to it for determination.
 
Where a dispute arises as to the Bank’s discharge of the Executive “for cause,”
such dispute shall likewise be submitted to arbitration as above described and
the parties hereto agree to be bound by the decision thereunder.

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IN WITNESS WHEREOF, the parties hereto acknowledge that each has carefully read
this Agreement and executed the original thereof on the first day set forth
hereinabove, and that, upon execution, each has received a conforming copy.

     PEACHTREE BANK      Maplesville, AL                      
By:
   Witness    (Bank Officer other than Insured)                            
Title                        
Witness
  Harvey N. Clapp

 
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