**Exhibit 10.12****EMPLOYMENT AGREEMENT**     **THISEMPLOYMENT AGREEMENT**(this “Agreement”) is made and entered into as of the       day ofSeptember, 2007 (the “Effective Date”), by and between United Bank (the “Bank”) and Allen O. Jones,Jr. (the “Executive”).     **WHEREAS**, the Bank and the Executive desire to enter into this Agreement to assure the Bank ofthe continued services of the Executive, to protect information that is of a proprietary nature tothe Bank and to set forth the duties and compensation of the Executive, all upon the terms andconditions hereinafter set forth.     **NOW, THEREFORE**, in consideration of the mutual covenants and agreements of the parties setforth in this Agreement, and other good and valuable consideration, the parties hereto, intendingto be legally bound, agree as follows:**1.****Employment; Term; Responsibilities; Exclusive Efforts****.**      **1.1****Employment****.**The Bank hereby employs the Executive as its SVP, and Chief FinancialOfficer, hereby accepts employment, upon and subject to all of the terms and conditions set forthin this Agreement.     **1.2****Term****.**The term of employment pursuant to this Agreement shall be for a periodof one (1) year commencing on the Effective Date, and shall automatically be renewed for successiveadditional one (1) year periods, unless the term of employment is terminated as provided in thisAgreement (the “Term”).     **1.3****Responsibilities****.**The Executive shall have the duties, functions,responsibilities and authorities that the President and Chief Executive Officer of the Bank (the“President”) or his designee assigns to the Executive from time to time, consistent with thetypical duties commensurate with the Executive’s position.     **1.4****Exclusive Efforts****.**The Executive shall devote the Executive’s full time,attention and energy to the business of the Bank. The Executive shall not engage in any activitywhich would interfere or conflict with the Executive’s duties and responsibilities as set forthherein or negatively affect the interests of the Bank. The Executive shall not engage in anybusiness or other activity for gain, profit or other pecuniary advantage unless any such activityis consented to by the President; provided, however, that should any such activity becomeinconsistent with the interests of the Bank, upon written notice from the President the Executiveshall promptly terminate such activities.**2.****Compensation, Benefits and Perquisites****.** As remuneration for all services to berendered by the Executive to the Bank during the Term, the Bank shall pay and provide to theExecutive the following compensation and benefits:
 

 
     **2.1****Annual Direct Compensation****.**           **(a) ****Annual Base Salary****.**The Bank shall pay to the Executive an annual base salary of$124,800 (the “Base Salary”). The Compensation Committee of the Board of Directors of the Bank(the “Compensation Committee”), with the assistance of the President, may, but shall not berequired to, review the Base Salary from time to time during the Term and increase the Base Salaryby such amount, if any, as the Compensation Committee determines, in its sole and absolutediscretion. The Bank shall pay the Base Salary to the Executive in equal installments throughoutthe year, consistent with the Bank’s normal payroll practices. The Base Salary shall be proratedfor any year of the Term that is less than a full calendar year.           **(b) ****Annual Incentive Compensation****.**The Bank shall provide to the Executive theopportunity to earn an annual incentive award (“Annual Incentive Compensation Award”) in accordancewith the Bank’s incentive plan (the “Incentive Plan”). The Bank reserves the right to modify ordiscontinue the Incentive Plan for all participants as desired without prior notice to theExecutive.     **2.2****Restricted Stock Grant****.**United Bancorporation of Alabama, Inc. (“UBA”) shallgrant to the Executive, pursuant to the terms and provisions of the 2007 Equity Incentive Plan ofUnited Bancorporation of Alabama, Inc. 505 restricted shares of UBA common stock (the “RestrictedStock”). The terms and provisions of the Restricted Stock shall be set forth in a separateagreement (the “Restricted Stock Award Agreement”) between the UBA and the Executive in accordancewith the provisions of the 2007 Equity Incentive Plan, and the Restricted Stock and the RestrictedStock Grant Agreement shall be subject to all of the terms and provisions of the 2007 EquityIncentive Plan. UBA may from time to time make such additional awards to the Executive under the2007 Equity Incentive Plan as it determines appropriate.     **2.3****Benefits and Perquisites****.**The Bank shall provide to the Executive all benefitsprovided to employees of the Bank generally, subject to the Executive meeting individualeligibility requirements for each such benefit. Such benefits shall include, but are not limitedto, such 401(k), profit sharing, group life and health, disability insurance and supplementalretirement benefits as may be made available to Bank employees generally from time to time. Allinsurance provided to the Executive shall be in such form and on such terms as is provided to otheremployees of the Bank. The Bank reserves the right to modify or discontinue any benefit programfor all participants as desired without prior notice to the Executive.     **2.4****Vacation****.**The Bank shall provide the Executive at least three weeks of paidvacation time each calendar year, such vacation to be scheduled in accordance with approved Bankpolicy consistent with the performance of the Executive’s duties hereunder. During any year inwhich the Executive is employed for less than the full calendar year, vacation time shall beprorated accordingly.**3.****Termination of Employment****.**The Executive’s employment may be terminated in accordancewith any of the provisions set forth in this Section 3.
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     **3.1 ****Events of Termination****.**          **(a)****Termination Due to Death or Disability****.**The Executive’s employment shallterminate immediately upon the Executive’s death or disability (as described herein). TheExecutive shall be deemed to suffer from a disability if (i) the Executive is disabled as definedin any disability insurance policy providing coverage for the Executive; or (ii) as a result of theExecutive’s incapacity due to physical or mental illness, the Executive is absent from thefull-time performance of the Executive’s duties with the Bank for ninety (90) or more days, whetheror not consecutive, during any six (6) month period.          **(b)****Voluntary Termination by the Executive****.**The Executive may terminate Executive’semployment at any time by delivering to the President written notice of the Executive’s intent toterminate, delivered at least thirty (30) calendar days prior to the effective date of suchtermination.  The termination shall become effective automatically upon the expiration of thethirty (30) day notice period.  Such notice shall also constitute the resignation by the Executiveof any other positions that the Executive may hold as an officer and/or director of the Bank and/orits affiliates.          **(c)****Voluntary Termination by the Bank****.**The Bank may terminate the Executive’semployment at any time, without Cause, as defined in Section 3.2(e), by delivering to the Executivewritten notice of the Bank’s intent to terminate, delivered at least thirty (30) calendar daysprior to the effective date of such termination. The termination shall become effectiveautomatically upon the expiration of the thirty (30) day notice period.  Unless otherwise stated inthe termination notice, such notice shall also constitute termination of the Executive as to anyother positions that the Executive may hold as an officer and/or director of the Bank and/or itsaffiliates.          **(d)****Termination by the Bank for Cause****.**The Bank may terminate the Executive’semployment for Cause by delivering written notice of the Bank’s intent to terminate. Any suchtermination shall be effective on the date specified in such notice.     **3.2****Payments Upon Termination****.**          **(a)****Payments Upon Termination Due To Death, Disability, Voluntary Termination ByExecutive, Voluntary Termination By The Bank, Termination by the Bank for Cause**.               **(i) **If, prior to the end of the Term, the Executive’s employment with the Bank terminates dueto the Executive’s death or disability, voluntary termination by the Executive, voluntarytermination by the Bank, or termination by the Bank for Cause, the Bank shall pay to the Executive(or to his legally appointed personal representative) (A) any accrued but unpaid Base Salary; (B)the cash component of any Annual Incentive Compensation Award that has been awarded in accordancewith the terms of the Incentive Plan but not paid, subject to any forfeiture provisions of theIncentive Plan; and (C) any amounts payable to the Executive under the terms of the Bank’s benefitsplans in which the Executive is a participant.
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               **(ii) **Subject to Section 3.2(c), item (A) of the preceding paragraph shall be paid in cashwithin thirty (30) days following the effective date of termination, or, if termination is due tothe death of the Executive, within thirty (30) days following the date on which the Executive’spersonal representative is qualified and begins serving. Amounts payable under items (B) and (C)of the preceding paragraph shall be paid in accordance with the terms of the respective plans.          **(b)****Payments Upon Termination By the Bank Without Cause or Termination By the ExecutiveWith Good Reason Within Two Years of a Change of Control****.**               **(i) **If, within two (2) years following a Change of Control, the Executive’s employment isterminated without Cause or if the Executive terminates the Executive’s employment with the Bankfor Good Reason, as defined in Section 3.2(f), the Bank shall pay to the Executive (A) any accruedbut unpaid Base Salary; (B) the cash component of any Annual Incentive Compensation Award that hasbeen awarded in accordance with the terms of the Incentive Plan but not paid, subject to anyforfeiture provisions of the Incentive Plan; (C) any amounts payable to the Executive under theterms of the Bank’s benefits plans in which the Executive is a participant; and (D) a cash benefitequal to the Executive’s annual Base Salary.               **(ii) **Subject to Section 3.2(c), item (A) of the preceding paragraph shall be paid in cashwithin thirty (30) days following the effective date of termination of the Executive’s employmentas described in Section 3.2(b)(i). Amounts payable under items (B) and (C) of the precedingparagraph shall be paid in accordance with the terms of the respective plans. Amounts payableunder item (D) may be paid (x) in cash in a lump sum together with the payment described in Item(A); or (y) in up to twelve (12) equal monthly installments, as may be elected by the Bank.               **(iii) **Following the effective date of termination of the Executive’s employment as describedin Section 3.2(b)(i), any stock options that have been granted but have not vested shallimmediately vest, and the restrictions shall lapse with respect to any restricted stock of UBA thathas been granted but as to which the restrictions have not lapsed. Following the effective date oftermination, the Executive may exercise any vested but unexercised stock options in accordance withthe terms of the plan or grant agreement pursuant to which such options were granted.          **(c)****Payments Subject to Section 409A****.**In the event that any payments under thisSection 3.2 are subject to the restrictions of Section 409A of the Internal Revenue Code, thenpayment shall not be made until the first (1st) day of the month following the six (6)month anniversary date of the effective date of termination.          **(d)****Change of Control****.**For purposes of this Agreement, a “Change of Control” of theBank shall be deemed to have occurred if (i) any “person” or “group” (other than UBA) hereafterbecomes the “beneficial owner” (as such terms are defined in the Securities Exchange Act of 1934),of securities representing fifty percent (50%) or more of the combined voting power of the Bank orUBA; (ii) a majority of the Board of Directors of the Bank or UBA, comprised of persons who werenot elected or nominated for election to such Board by current
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directors of the Bank or UBA or directors who (or whose predecessors on such Board) wereultimately nominated or elected by the current directors of the Bank or UBA, is elected; (iii) theshareholders of the Bank or of UBA approve a merger or consolidation of the Bank or of UBA, otherthan a merger or consolidation which results in the voting securities of the Bank or of UBAoutstanding immediately prior thereto continuing to represent (either by remaining outstanding orby being converted into voting securities of the surviving entity) at least 80% of the combinedvoting power of the voting securities of the Bank or of UBA, as the case may be, of such survivingentity outstanding immediately after such merger or consolidation; or (iv) the shareholders of theBank or of UBA approve a plan of complete liquidation or an agreement for the sale or dispositionof all or substantially all of the assets, of the Bank or of UBA, as the case may be.          **(e)****Cause****.**For purposes of this Section 3, “Cause” shall mean any circumstancesdemonstrating to the Board of Directors of the Bank that the Executive has undertaken deliberateactions with the intent to cause, or with reckless disregard for the possibility of causing,substantial injury to the Bank, as well as the following:               **(i) **The Executive’s conviction of, or his plea of guilty or nolo contendere to, (x) a felonyor misdemeanor involving moral turpitude, including without limitation fraud, embezzlement, theft,or dishonesty, (y) any other felony or misdemeanor involving criminal conduct against the Bank, or(z) any other felony.               **(ii) **Findings by the Board of Directors of the Bank that the Executive has engaged in anyimproper actions specified in Section 3.2(e)(i) above, or that criminal charges have been filedagainst the Executive for such actions.               **(iii) **The Executive’s willful misconduct or breach of fiduciary duty with respect to thehandling of monies or other properties or interests of others.               **(iv) **Issuance to the Executive by a governmental or administrative agency of a final cease anddesist order with respect to actions personally taken by the Executive.               **(v) **Habitual neglect of his responsibilities hereunder, failure to properly account for fundsor accounts for which the Executive has been made specifically accountable, or failure to performthe Executive’s responsibilities under this Agreement after written notice and a reasonableopportunity to cure such failure.          **(f)****Good Reason****.**The Executive shall be deemed for the purposes of this Section 3 tohave terminated the Executive’s employment for “Good Reason” if the Executive terminates theExecutive’s employment after the occurrence (other than such as may be isolated, unsubstantial andinadvertent on the Bank’s part and which is remedied promptly by the Bank after receipt of noticefrom the Executive), without the Executive’s express written consent and after a Change of Control,of any one or more of the following: (i) a substantial reduction or alteration in the nature orstatus of the Executive’s responsibilities and status (including offices, titles and reportingrequirements) from those in effect during the six-month period immediately preceding the Change ofControl; (ii) a reduction by the Bank in the Executive’s total
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compensation as in effect on the date hereof, or as the same may be increased from time to time;(iii) the failure by the Bank to continue the Executive’s participation in any of the Bank’semployee benefit plans, practices or arrangements in which the Executive participates, onsubstantially the same basis as those provided generally from time to time after the Change ofControl to other peer officers of the Bank and its affiliated companies; or (iv) the failure of anysuccessor to the Bank to assume or otherwise be bound to perform the Bank’s obligations under thisAgreement.     **3.3****Business Records****.**Upon termination of the Executive’s employment, the Executiveagrees to promptly deliver to the Bank, all Business Records belonging to the Bank, UBA or anyaffiliate of the Bank, and all copies thereof and therefrom, including any Business Records thatmay be maintained in electronic form, and the Executive acknowledges that such Business Recordsconstitute the exclusive property of the Bank. The term “Business Records” means all customerfiles, contract files, reports and related data, memoranda, notes, records, drawings, manuals,correspondence, financial and accounting information, customer lists, statistical data andcompilations, patents, copyrights, trademarks, trade names, inventions, formulae, methods,processes, agreements, contracts, manuals or any other documents relating to the business of theBank, UBA or any affiliate of the Bank.**4.****Confidentiality****.**In consideration of the Executive’s employment by the Bank and of theconfidential information that the Executive will acquire by virtue of such employment, theExecutive agrees to comply with the confidentiality provisions of this Section 4.