`U.S. SECURITIES AND EXCHANGE COMMISSION
                                                    WASHINGTON, D.C. 20549

                                                           FORM 10-K

[X]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2009

                                                              OR

[  ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____ to ____

                                                 Commission file no. 33-94288

                                                  THE FIRST BANCSHARES, INC.
                                      --------------------------------------------------
                                    (Exact name of registrant as specified in its charter)

                 Mississippi                                                        64-0862173
-------------------------------------------------            ---------------------------------------------------------
         (State or Other Jurisdiction of                              (I.R.S. Employer Identification Number)
         Incorporation or Organization)

           6480 U.S. Hwy. 98 West
           Hattiesburg, Mississippi                                                     39402
------------------------------------------------             ---------------------------------------------------------
     (Address of principal executive offices)                                          (Zip Code)

Issuer's telephone number:                   (601) 268-8998
                                ----------------------------------------------------

Securities registered under Section 12(b) of the Exchange Act:

                                                                       Name of Each Exchange on
             Title of Each Class                                           Which Registered
             -------------------                                       -------------------------

         Common Stock, $1.00 par value                                   NASDAQ Stock Market, LLC
-----------------------------------------------                    -------------------------------------

Securities registered pursuant to Section 12(g) of the Act:  None`

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`Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in rule 405 of the
Securities Act.

Yes                         No      X
   ------------                ------------

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d)
of the Act.

Yes                         No      X
   ------------                ------------

Note - Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or
15(d) of the Exchange Act from their obligations under those Sections.

Indicate by check mark whether  the registrant  (1) has filed all reports required to be filed by Section 13 or
15(d) of the Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing requirements for the past 90
days.

Yes     X                    No
   ------------                ------------

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website,
if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§
232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was
required to submit and post such files).

Yes                         No
   ------------                ------------

Indicate by check mark  if  disclosure of delinquent filers in response to Item 405 of Regulation S-K is not
contained herein, and will not be contained, to the best of the registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K       X
             -------

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act).      Yes              No     X
               -------          --------

Indicate by check mark whether the registrant is a large accelerated file, an accelerated filer,  a
non-accelerated filer, or a smaller reporting company.  See the definitions of "large accelerated filer,"
"accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act  (Check one):

Large accelerated filer       Accelerated filer      Non-accelerated filer      Smaller reporting company   X
                        ----                   ----                        ----                           -----

         Based on the price at which the registrant's Common Stock was last sold at March 25, 2010, at that date,
the aggregate market value of  the registrant's  Common Stock held by non-affiliates of the registrant (assuming
solely for the purposes of this calculation that all directors and executive officers of the registrant are
"affiliates") was  $19,927,655.

         State the number of shares outstanding of each of the registrant's classes of common stock, as of the
latest practicable date.  3,019,869  on March 25, 2010.

                                        DOCUMENTS INCORPORATED BY REFERENCE

         Portions of the following documents are incorporated by reference to Parts II and III of the Form 10-K
report: Proxy Statement dated April 20, 2010, and the Annual Report to the Stockholders for the year ended
December 31, 2009.`

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`THE FIRST BANCSHARES, INC.
                                                FORM 10-K
                                            TABLE OF CONTENTS
                                                                                                          Page

                                                  PART I

ITEM 1.      BUSINESS........................................................................................1
ITEM 1A.     RISK FACTORS...................................................................................12
ITEM 1B.     UNRESOLVED STAFF COMMENTS......................................................................18
ITEM 2.      PROPERTIES.....................................................................................18
ITEM 3.      LEGAL PROCEEDINGS..............................................................................18
ITEM 4.      RESERVED.......................................................................................18

                                                 PART II

ITEM 5.      MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER
             MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES..............................................19
ITEM 6.      SELECTED FINANCIAL DATA........................................................................19
ITEM 7.      MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
             RESULTS OF OPERATIONS..........................................................................19
ITEM 7A.     QUANTITATIVE AND QUALITATIVE DISCLOSURES.......................................................19
ITEM 8.      FINANCIAL STATEMENTS...........................................................................19
ITEM 9.      CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
             AND FINANCIAL DISCLOSURE.......................................................................19
ITEM 9A(T).  CONTROLS AND PROCEDURES........................................................................19
ITEM 9B.     OTHER INFORMATION..............................................................................20

                                                 PART III

ITEM 10.     DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.............................................20
ITEM 11.     EXECUTIVE COMPENSATION.........................................................................21
ITEM 12.     SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
             MANAGEMENT AND RELATED STOCKHOLDER MATTERS.....................................................21
ITEM 13.     CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.................................................21
ITEM 14.     PRINCIPAL ACCOUNTANT FEES AND SERVICES.........................................................21

                                                  PART IV

ITEM 15.     EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.....................................................21`

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THE FIRST BANCSHARES, INC.FORM 10-K

PART I

This Report contains statements which
constitute forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933 and the Securities Exchange Act of 1934. These statements appear in a number
of places in this Report and include all statements regarding the intent, belief or
current expectations of the Company, its directors or its officers with respect to, among
other things: (i) the Companys financing plans; (ii) trends affecting the
Companys financial condition or results of operations; (iii) the Companys
growth strategy and operating strategy; and (iv) the declaration and payment of dividends.
Investors are cautioned that any such forward-looking statements are not guarantees of
future performance and involve risks and uncertainties, and that actual results may differ
materially from those projected in the forward-looking statements as a result of various
factors discussed herein and those factors discussed in detail in the Companys
filings with the Securities and Exchange Commission.

BUSINESS OF THE COMPANY

General

The First Bancshares, Inc. (the
Company) was incorporated on June 23, 1995 to serve as a bank holding company
for The First, A National Banking Association (The First) located in
Hattiesburg, Mississippi. The First began operations on August 5, 1996 from its main
office in the Oak Grove community, which was on the outskirts of Hattiesburg but now is
included in the city of Hattiesburg. In addition to the main office in Hattiesburg and the
branch in Laurel, The First also operates two other branches in Hattiesburg, one in
Purvis, one in Picayune, one in Pascagoula, one in Bay St. Louis, one in Wiggins,and one
in Gulfport, Mississippi. The Company and its subsidiary bank engage in a general
commercial and retail banking business characterized by personalized service and local
decision-making, emphasizing the banking needs of small to medium-sized businesses,
professional concerns and individuals. The First is a wholly-owned subsidiary bank of the
Company.

Location and Service Area

The First serves the cities of
Hattiesburg, Laurel, Purvis, Picayune, Pascagoula, Bay St. Louis, Wiggins, Gulfport and
the surrounding areas of Lamar, Forrest, Jones, Pearl River ,Jackson, Hancock, Stone and
Harrison Counties, Mississippi. The First has a main office located in the city of
Hattiesburg, Mississippi, in Lamar County. The First has a branch office located on
Highway 589 in the city of Purvis, Mississippi, also in Lamar County, a third office
located at the intersection of Lincoln Road and South 28th Avenue in Hattiesburg, a fourth
location at 110 S. 40th Ave. in Hattiesburg, a fifth location on Hwy 15 North in Laurel, a
sixth location on Hwy 43 South in Picayune, a seventh location on Jackson Avenue in
Pascagoula, an eighth location on Hwy 90 in Bay St. Louis, a ninth location on Border Ave.
in Wiggins and a tenth location at Hwy 49 and ONeal Rd in Gulfport, Mississippi.

The main office primarily serves the
area in and around the northern portion of Lamar County. The Purvis office primarily
serves the area in and around Purvis, Mississippi, which is in the east central part of
Lamar County and is the county seat. Lamar County is located in the southeastern section
of Mississippi. Hattiesburg, one of the largest cities in Mississippi, is located in
Forrest and Lamar Counties. The Laurel office serves the city of Laurel and the
surrounding area of Jones County, Mississippi. The Picayune office primarily serves the
area in and around Picayune, Mississippi, including areas of north Hancock County and
Pearl River, LA and Slidell, LA. Picayune is located in the southern part of Pearl River
County. Pearl River County is located in the southern section of Mississippi. The
Pascagoula office primarily serves the area in and around Pascagoula, Mississippi,
including areas of Jackson County. Hattiesburg can be reached via U.S. Highways 98 and 49
and Interstate 59. Major employers located in the Lamar and Forrest County areas include
Forrest General Hospital, the University of Southern Mississippi, Wesley Medical Center,
Camp Shelby, the Hattiesburg Public Schools, the Hattiesburg Clinic, the City of
Hattiesburg, and Marshall Durbin Poultry. The principal components of the economy of the
Lamar and Forrest County areas include service industries, wholesale and retail trade,
manufacturing, and transportation and public utilities. The Laurel branch is located at
1945 Highway 15 North, Laurel, MS, with the majority of its retail business coming from
the local area and the remaining business coming from other areas of Jones County, as well
as portions of Jasper County, Wayne County, Smith County, and Covington County. Major
employers in the Jones County

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area include Howard Industries,
Sanderson Farms, Inc., and South Central Regional Medical Center. Major employers in the
Pearl River County area include Stennis Space Center, Chevron, Texaco, Arizona Chemical,
American Crescent Elevator Co., City of Picayune, Crosby Memorial Hospital and the public
schools. The principal components of the economy of the Pearl River County area include
timber, service industries, wholesale and retail trade, manufacturing, and transportation
and public utilities. Major employers in the Jackson County area include Northrop Grumman,
Singing River Hospital, and Shell Oil Company. The Bay St. Louis office serves the City of
Bay St. Louis and the surrounding area of Hancock County, Mississippi. Bay St. Louis can
be reached via U.S. Highway 90. Major employers in the Hancock area include the City of
Bay St. Louis, Hancock County, and Stennis Space Center. The Wiggins office serves the
City of Wiggins and the surrounding area of Stone County, Mississippi. Stone County is
south of Forrest County and north of Harrison County. Wiggins can be reached via U. S.
Highway 49. The Gulfport office serves the City of Gulfport and the surrounding area of
Harrison County, Mississippi. Gulfport can be reached via U.S. Highway 49. Major employers
in the Harrison County area include Keesler Air Force Base and a vast array of casinos.

Banking Services

The Company strives to provide its
customers with the breadth of products and services comparable to those offered by large
regional banks, while maintaining the quick response and personal service of a locally
owned and managed bank. In addition to offering a full range of deposit services and
commercial and personal loans, The First offers products such as mortgage loan
originations. The following is a description of the products and services offered or
planned to be offered by the Bank.

`        Deposit Services.  The Bank offers a full range of deposit services that are typically
         available in most banks and savings and loan associations, including checking accounts, NOW
         accounts, savings accounts, and other time deposits of various types, ranging from daily money
         market accounts to longer-term certificates of deposit.  The transaction accounts and time
         certificates are tailored to the Bank's principal market area at rates competitive to those
         offered by other banks in the area.  In addition, the Bank offers certain retirement account
         services, such as Individual Retirement Accounts (IRAs).  All deposit accounts are insured by
         the Federal Deposit Insurance Corporation (the "FDIC") up to the maximum amount allowed by
         law.  The Bank solicits these accounts from individuals, businesses, associations and
         organizations, and governmental authorities.

        Loan Products.  The Bank offers a full range of commercial and personal loans.  Commercial
         loans include both secured and unsecured loans for working capital (including loans secured by
         inventory and accounts receivable), business expansion (including acquisition of real estate
         and improvements), and purchase of equipment and machinery.  Consumer loans include equity
         lines of credit and secured and unsecured loans for financing automobiles, home improvements,
         education, and personal investments.  The Bank also makes real estate construction and
         acquisition loans.  The Bank's lending activities are subject to a variety of lending limits
         imposed by federal law.  While differing limits apply in certain circumstances based on the
         type of loan or the nature of the borrower (including the borrower's relationship to the bank),
         in general the Bank is subject to a loans-to-one-borrower limit of an amount equal to 15% of
         the Bank's unimpaired capital and surplus.  The Bank may not make any loans to any director,
         executive officer, or 10% shareholder unless the loan is approved by the Board of Directors of
         the Bank and is made on terms not more favorable to such a person than would be available to a
         person not affiliated with the Bank.

        Mortgage Loan Divisions.  The Bank has mortgage loan divisions which originate loans to
         purchase existing or construct new homes and to refinance existing mortgages.`

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`        Other Services.  Other bank services include on-line internet banking services, voice response
         telephone inquiry service, commercial sweep accounts, cash management services, safe deposit
         boxes, travelers checks, direct deposit of payroll and social security checks, and automatic
         drafts for various accounts.  The Bank is associated with the Interlink, Plus, Pulse and Star
         networks of automated teller machines that may be used by the Bank's customers throughout
         Mississippi and other regions.  The Bank also offers VISA and MasterCard credit card services
         through a correspondent bank.`

Competition

The Bank generally competes with
other financial institutions through the selection of banking products and services
offered, the pricing of services, the level of service provided, the convenience and
availability of services, and the degree of expertise and the personal manner in which
services are offered. Mississippi law permits statewide branching by banks and savings
institutions, and many financial institutions in the state have branch networks.
Consequently, commercial banking in Mississippi is highly competitive. Many large banking
organizations currently operate in the Companys market area, several of which are
controlled by out-of-state ownership. In addition, competition between commercial banks
and thrift institutions (savings institutions and credit unions) has been intensified
significantly by the elimination of many previous distinctions between the various types
of financial institutions and the expanded powers and increased activity of thrift
institutions in areas of banking which previously had been the sole domain of commercial
banks. Federal legislation, together with other regulatory changes by the primary
regulators of the various financial institutions, has resulted in the almost total
elimination of practical distinctions between a commercial bank and a thrift institution.
Consequently, competition among financial institutions of all types is largely unlimited
with respect to legal ability and authority to provide most financial services.

The Company faces increased
competition from both federally-chartered and state-chartered financial and thrift
institutions, as well as credit unions, consumer finance companies, insurance companies,
and other institutions in the Companys market area. Some of these competitors are
not subject to the same degree of regulation and restriction imposed upon the Company.
Many of these competitors also have broader geographic markets and substantially greater
resources and lending limits than the Company and offer certain services such as trust
banking that the Company does not currently provide. In addition, many of these
competitors have numerous branch offices located throughout the extended market areas of
the Company that may provide these competitors with an advantage in geographic convenience
that the Company does not have at present.

Currently there are numerous other
commercial banks, savings institutions, and credit unions operating in The Firsts
primary service area.

Employees

As of March 25, 2010, the Company had
149 full-time employees and 9 part-time employees.

SUPERVISION AND REGULATION

The Company and its bank are subject
to state and federal banking laws and regulations which impose specific requirements or
restrictions on and provide for general regulatory oversight with respect to virtually all
aspects of operations. These laws and regulations are generally intended to protect
depositors, not shareholders. To the extent that the following summary describes statutory
or regulatory provisions, it is qualified in its entirety by reference to the particular
statutory and regulatory provisions. Any change in applicable laws or regulations may have
a material effect on the business and prospects of the Company. Beginning with the
enactment of the Financial Institutions Reform, Recovery and Enforcement Act of 1989
(FIRREA) and following with Federal Deposit Insurance Corporation Improvement
Act of 1991 (FDICIA), numerous additional regulatory requirements have been
placed on the banking industry in the past several years, and additional changes have been
proposed. The operations of the Company and the Bank may be affected by legislative
changes and the policies of various regulatory authorities. The Company is unable to
predict the nature or the extent of the effect on its business and earnings that fiscal or
monetary policies, economic control, or new federal or state legislation may have in the
future.

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Legislative and Regulatory Initiatives to Address Financial and Economic Crises

The Congress, Treasury Department and
the federal banking regulators, including the FDIC, have taken broad action since early
September, 2008 to address volatility in the U.S. banking system.

In October 2008, the Emergency
Economic Stabilization Act of 2008 (EESA) was enacted. The EESA authorizes the
Treasury Department to purchase from financial institutions and their holding companies up
to $700 billion in mortgage loans, mortgage-related securities and certain other financial
instruments, including debt and equity securities issued by financial institutions and
their holding companies in a troubled asset relief program (TARP). The purpose
of TARP is to restore confidence and stability to the U.S. banking system and to encourage
financial institutions to increase their lending to customers and to each other. The
Treasury Department has allocated $250 billion towards the TARP Capital Purchase Program
(CPP). Under the CPP, Treasury will purchase debt or equity securities from
participating institutions. The TARP also includes direct purchases or guarantees of
troubled assets of financial institutions. Participants in the CPP are subject to
executive compensation limits and are encouraged to expand their lending and mortgage loan
modifications.

On February 6, 2009, as part of the
TARP CPP, the Company entered into a Letter Agreement and Securities Purchase Agreement
(collectively, the Purchase Agreement) with the Treasury Department, pursuant
to which the Company sold (i) 5,000 shares of the Companys Fixed Rate Cumulative
Perpetual Preferred Stock, Series UST (the UST Preferred Stock) and (ii) a
warrant (the Warrant) to purchase 54,705 shares of the Companys Common
Stock for an exercise price of $13.71 per share.

The UST Preferred Stock qualifies as
Tier 1 capital and is entitled to cumulative dividends at a rate of 5% per annum for the
first five years, and 9% per annum thereafter. The Warrant has a 10-year term and is
immediately exercisable upon its issuance, and its exercise price is subject to
anti-dilution adjustments.

EESA also increased FDIC deposit
insurance on most accounts from $100,000 to $250,000. This increase is in place until the
end of 2013 and is not covered by deposit insurance premiums paid by the banking industry.

Following a systemic risk
determination, the FDIC established a Temporary Liquidity Guarantee Program
(TLGP) on October 14, 2008. The TLGP includes the Transaction Account
Guarantee Program (TAGP), which provides unlimited deposit insurance coverage
through June 30, 2010 for noninterest-bearing transaction accounts (typically business
checking accounts) and certain funds swept into noninterest-bearing savings accounts.
Institutions participating in the TAGP pay a 10 basis points fee (annualized) on the
balance of each covered account in excess of $250,000, while the extra deposit insurance
is in place. The Company is participating in the TAGP.

Effects of American Reinvestment and Recovery Act of 2009

On February 17, 2009, President Obama
signed into law the America Reinvestment and Recovery Act of 2009 (ARRA). ARRA
contains expansive new restrictions on executive compensation for financial institutions
and other companies participating in the CPP. These restrictions apply to us and are
further detailed in implementing regulations found at 31 CFR Part 30. (Any reference to
ARRA herein includes a reference to the implementing regulations.)

ARRA prohibits bonus and similar
payments to the most highly compensated employee of the Company. The prohibition does not
apply to bonuses payable pursuant to employment agreements in effect prior to
February 11, 2009. Long-term restricted stock is excluded from ARRAs
bonus prohibition, but only to the extent the value of the stock does not exceed one-third
of the total amount of annual compensation of the employee receiving the stock, the stock
does not fully vest until after all CPP-related obligations have been
satisfied, and any other conditions which the Treasury may specify have been met.

ARRA prohibits any payment to the
principal executive officer, the principal financial officer, and any of the next eight
most highly compensated employees upon departure from the Company for any reason for as
long as any CPP-related obligations remain outstanding.

Under ARRA CPP-participating
companies are required to recover any bonus or other incentive payment paid to the
principal executive officer, the principal financial officer, or any of the next 23 most
highly compensated employees on the basis of materially inaccurate financial or other
performance criteria.

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ARRA prohibits CPP participants from
implementing any compensation plan that would encourage manipulation of the reported
earnings of the Company in order to enhance the compensation of any of its employees.

ARRA requires the Chief Executive
Officer and the Chief Financial Officer of any publicly-traded CPP-participating company
to provide a written certification of compliance with the executive compensation
restrictions in ARRA in the companys annual filings with the SEC beginning in 2010.

ARRA requires each CPP-participating
company to implement a company-wide policy regarding excessive or luxury expenditures,
including excessive expenditures on entertainment or events, office and facility
renovations, aviation or other transportation services.

ARRA directs the Treasury to review
bonuses, retention awards, and other compensation paid to the Chief Executive Officer and
the next four other highest paid executive officer of the Company and the next 20 most
highly compensated employees of each company receiving CPP assistance before ARRA was
enacted, and to seek to negotiate with the CPP recipient and affected
employees for reimbursement if it finds any such payments were inconsistent with CPP or
otherwise in conflict with the public interest.

AARA also prohibits the payment of
tax gross-ups; required disclosures related to perquisite payments and the engagement, if
any, by the CPP participant of a compensation consultant; and prohibits the deduction for
tax purposes of executive compensation in excess of $500,000 for each applicable senior
executive.

These standards could change based on
subsequent guidance issued by the Treasury or the Internal Revenue Service. Both prior to
its participation in the CPP, and for so long as the Treasury continues to hold equity
interests in the Company issued under the CPP, the Company will monitor its compensation
arrangements and modify such compensation arrangements, agree to limit and limit its
compensation deductions, and take such other actions as may be necessary to comply with
the standards discussed above, as they may be modified from time to time. The Company does
not anticipate that any material changes to its existing executive compensation structure
will be required to comply with the executive compensation standards included in the CPP.

The Company

Because it owns the outstanding
capital stock of the Bank, the Company is a bank holding company within the meaning of the
Federal Bank Holding Company Act of 1956 (the BHCA).

The BHCA. Under the BHCA, the Company
is subject to periodic examination by the Federal Reserve and is required to file periodic
reports of its operations and such additional information as the Federal Reserve may
require. The Companys and the Banks activities are limited to banking,
managing or controlling banks, furnishing services to or performing services for its
subsidiaries, and engaging in other activities that the Federal Reserve determines to be
so closely related to banking or managing or controlling banks as to be a proper incident
thereto.

Investments, Control, and Activities.
With certain limited exceptions, the BHCA requires every bank holding company to obtain
the prior approval of the Federal Reserve before (i) acquiring substantially all the
assets of any bank, (ii) acquiring direct or indirect ownership or control of any voting
shares of any bank if after such acquisition it would own or control more than 5% of the
voting shares of such bank (unless it already owns or controls the majority of such
shares), or (iii) merging or consolidating with another bank holding company.

In addition, and subject to certain
exceptions, the BHCA and the Change in Bank Control Act, together with regulations
thereunder, require Federal Reserve approval (or, depending on the circumstances, no
notice of disapproval) prior to any person or company acquiring control of a
bank holding company, such as the Company. Control is conclusively presumed to exist if an
individual or company acquires 25% or more of any class of voting securities of the bank
holding company. Control is rebuttably presumed to exist if a person acquires 10% or more
but less than 25% of any class of voting securities and either the Company has registered
securities under Section 12 of the Exchange Act (which the Company has done) or no other
person owns a greater percentage of that class of voting securities immediately after the
transaction. The regulations provide a procedure for challenge of the rebuttable control
presumption.

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Under the BHCA, a bank holding
company is generally prohibited from engaging in, or acquiring direct or indirect control
of more than 5% of the voting shares of any company engaged in nonbanking activities,
unless the Federal Reserve Board, by order or regulation, has found those activities to be
so closely related to banking or managing or controlling banks as to be a proper incident
thereto. Some of the activities that the Federal Reserve Board has determined by
regulation to be proper incidents to the business of a bank holding company include making
or servicing loans and certain types of leases, engaging in certain insurance and discount
brokerage activities, performing certain data processing services, acting in certain
circumstances as a fiduciary or investment or financial adviser, owning savings
associations, and making investments in certain corporations or projects designed
primarily to promote community welfare.

The Federal Reserve Board has imposed
certain capital requirements on the Company under the BHCA, including a minimum leverage
ratio and a minimum ratio of qualifying capital to risk-weighted assets. These
requirements are described below under Capital Regulations. Subject to its
capital requirements and certain other restrictions, the Company may borrow money to make
a capital contribution to the Banks, and such loans may be repaid from dividends paid from
the Bank to the Company (although the ability of the Bank to pay dividends is subject to
regulatory restrictions as described below in The Bank  Dividends). The
Company is also able to raise capital for contribution to the Bank by issuing securities
without having to receive regulatory approval, subject to compliance with federal and
state securities laws.

Source of Strength; Cross-Guarantee.
In accordance with Federal Reserve Board policy, the Company is expected to act as a
source of financial strength to the Bank and to commit resources to support the Bank in
circumstances in which the Company might not otherwise do so. Under the BHCA, the Federal
Reserve Board may require a bank holding company to terminate any activity or relinquish
control of a nonbank subsidiary (other than a nonbank subsidiary of a bank) upon the
Federal Reserve Boards determination that such activity or control constitutes a
serious risk to the financial soundness or stability of any subsidiary depository
institution of the bank holding company. Further, federal bank regulatory authorities have
additional discretion to require a bank holding company to divest itself of any bank or
nonbank subsidiary if the agency determines that divestiture may aid the depository
institutions financial condition.

The Bank

The Bank operates as a national
banking association incorporated under the laws of the United States and subject to
examination by the Office of Comptroller of the Currency (OCC). Deposits in
the Bank are insured by the FDIC up to a maximum amount (generally $250,000 per depositor,
subject to aggregation rules). The OCC and the FDIC regulate or monitor virtually all
areas of the Banks operations, including security devices and procedures, adequacy
of capitalization and loan loss reserves, loans, investments, borrowings, deposits,
mergers, issuances of securities, payment of dividends, interest rates payable on
deposits, interest rates or fees chargeable on loans, establishment of branches, corporate
reorganizations, maintenance of books and records, and adequacy of staff training to carry
on safe lending and deposit gathering practices. The OCC requires the Bank to maintain
certain capital ratios and imposes limitations on the Banks aggregate investment in
real estate, bank premises, and furniture and fixtures. The Bank is required by the OCC to
prepare quarterly reports on their financial condition and to conduct an annual audit of
their financial affairs in compliance with minimum standards and procedures prescribed by
the OCC.

Under FDICIA, all insured
institutions must undergo regular on-site examinations by their appropriate banking
agency. The cost of examinations of insured depository institutions and any affiliates may
be assessed by the appropriate agency against each institution or affiliate as it deems
necessary or appropriate. Insured institutions are required to submit annual reports to
the FDIC and the appropriate agency (and state supervisor when applicable). FDICIA also
directs the FDIC to develop with other appropriate agencies a method for insured
depository institutions to provide supplemental disclosure of the estimated fair market
value of assets and liabilities, to the extent feasible and practicable, in any balance
sheet, financial statement, report of condition, or any other report of any insured
depository institution. FDICIA also requires the federal banking regulatory agencies to
prescribe, by regulation, standards for all insured depository institutions and depository
institution holding companies relating, among other things, to: (i) internal controls,
information systems, and audit systems; (ii) loan documentation; (iii) credit
underwriting; (iv) interest rate risk exposure; and (v) asset quality.

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National banks and their holding
companies which have been chartered or registered or undergone a change in control within
the past two years or which have been deemed by the OCC or the Federal Reserve Board,
respectively, to be troubled institutions must give the OCC or the Federal Reserve Board,
respectively, thirty days prior notice of the appointment of any senior executive officer
or director. Within the thirty day period, the OCC or the Federal Reserve Board, as the
case may be, may approve or disapprove any such appointment.

Deposit Insurance. The FDIC
establishes rates for the payment of premiums by federally insured banks and thrifts for
deposit insurance. A separate Bank Insurance Fund (BIF) and Savings
Association Insurance Fund (SAIF) are maintained for commercial banks and
thrifts, respectively, with insurance premiums from the industry used to offset losses
from insurance payouts when banks and thrifts fail. Since 1993, insured depository
institutions like the Bank have paid for deposit insurance under a risk-based premium
system.

Transactions With Affiliates and
Insiders. The Bank is subject to Section 23A of the Federal Reserve Act, which places
limits on the amount of loans to, and certain other transactions with, affiliates, as well
as on the amount of advances to third parties collateralized by the securities or
obligations of affiliates. The aggregate of all covered transactions is limited in amount,
as to any one affiliate, to 10% of the Banks capital and surplus and, as to all
affiliates combined, to 20% of the Banks capital and surplus. Furthermore, within
the foregoing limitations as to amount, each covered transaction must meet specified
collateral requirements.

The Bank is also subject to Section
23B of the Federal Reserve Act, which prohibits an institution from engaging in certain
transactions with affiliates unless the transactions are on terms substantially the same,
or at least as favorable to such institution, as those prevailing at the time for
comparable transactions with nonaffiliated companies. The Bank is subject to certain
restrictions on extensions of credit to executive officers, directors, certain principal
shareholders, and their related interests. Such extensions of credit (i) must be made on
substantially the same terms, including interest rates and collateral, as those prevailing
at the time for comparable transactions with third parties and (ii) must not involve more
than the normal risk of repayment or present other unfavorable features.

Dividends.  A national bank may not pay dividends
from its capital. All dividends must be paid out of undivided profits then on hand, after
deducting expenses, including reserves for losses and bad debts. In addition, a national
bank is prohibited from declaring a dividend on its shares of common stock until its surplus
equals its stated capital, unless the bank has transferred to surplus no less than one-tenth
of its net profits of the preceding two consecutive half-year periods (in the case of an
annual dividend). The approval of the OCC is required if the total of all dividends declared
by a national bank in any calendar year exceeds the total of its net profits for that year
combined with its retained net profits for the preceding two years, less any required transfers
to surplus. In addition, under FDICIA, the banks may not pay a dividend if, after paying the
dividend, the bank would be undercapitalized. See Capital Regulations below.

Branching.  National banks are required by the National
Bank Act to adhere to branch office banking laws applicable to state banks in the states in
which they are located.  Under current Mississippi law, banks may open branches throughout Mississippi
with the prior approval of the OCC. In addition, with prior regulatory approval, banks are able to
acquire existing banking operations in Mississippi.  Furthermore, federal legislation has recently
been passed which permits interstate branching. The new law permits out of state acquisitions by bank
holding companies (subject to veto by new state law), interstate branching by banks if allowed by
state law, interstate merging by banks, and de novo branching by national banks if allowed by state
law. See Recent Legislative Developments.

Community Reinvestment Act. The Community Reinvestment Act
requires that, in connection with examinations of financial institutions within their respective
jurisdictions, the Federal Reserve, the FDIC, the OCC, or the Office of Thrift Supervision shall
evaluate the record of the financial institutions in meeting the credit needs of their local communities,
including low and moderate income neighborhoods, consistent with the safe and sound operation of those
institutions. These factors are also considered in evaluating mergers, acquisitions, and
applications to open a branch or facility.

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Other Regulations. Interest and
certain other charges collected or contracted for by the Banks are subject to state usury
laws and certain federal laws concerning interest rates. The Banks loan operations
are subject to certain federal laws applicable to credit transactions, such as the federal
Truth-In-Lending Act, governing disclosures of credit terms to consumer borrowers; the
Home Mortgage Disclosure Act of 1975, requiring financial institutions to provide
information to enable the public and public officials to determine whether a financial
institution is fulfilling its obligation to help meet the housing needs community it
serves; the Equal Credit Opportunity Act, prohibiting discrimination on the basis of creed
or other prohibited factors in extending credit; the Fair Credit Reporting Act of 1978,
governing the use and provision of information to credit reporting agencies; the Fair Debt
Collection Act, concerning the manner in which consumer debts may be collected by
collection agencies; and the rules and regulations of the various federal agencies charged
with the responsibility of implementing such federal laws. The deposit operations of the
Bank also are subject to the Right to Financial Privacy Act, which imposes a duty to
maintain confidentiality of consumer financial records and prescribes procedures for
complying with administrative subpoenas of financial records, and the Electronic Funds
Transfer Act and Regulation E issued by the Federal Reserve Board to implement that Act,
which governs automatic deposits to and withdrawals from deposit accounts and
customers rights and liabilities arising from the use of automated teller machines
and other electronic banking services.

Capital Regulations. The federal bank
regulatory authorities have adopted risk-based capital guidelines for banks and bank
holding companies that are designed to make regulatory capital requirements more sensitive
to differences in risk profile among banks and bank holding companies, account for
off-balance sheet exposure, and minimize disincentives for holding liquid assets. The
resulting capital ratios represent qualifying capital as a percentage of total
risk-weighted assets and off-balance sheet items. The guidelines are minimums, and the
federal regulators have noted that banks and bank holding companies contemplating
significant expansion programs should not allow expansion to diminish their capital ratios
and should maintain ratios well in excess of the minimums. The current guidelines require
all bank holding companies and federally-regulated banks to maintain a minimum risk-based
total capital ratio equal to 8%, of which at least 4% must be Tier 1 capital. Tier 1
capital includes common shareholders equity, qualifying perpetual preferred stock,
and minority interests in equity accounts of consolidated subsidiaries, but excludes
goodwill and most other intangibles and excludes the allowance for loan and lease losses.
Tier 2 capital includes the excess of any preferred stock not included in Tier 1 capital,
mandatory convertible securities, hybrid capital instruments, subordinated debt and
intermediate term-preferred stock, and general reserves for loan and lease losses up to
1.25% of risk-weighted assets.

Under the guidelines, banks and
bank holding companies assets are given risk-weights of 0%, 20%, 50% and 100%. In
addition, certain off-balance sheet items are given credit conversion factors to convert
them to asset equivalent amounts to which an appropriate risk-weight will apply. These
computations result in the total risk-weighted assets. Most loans are assigned to the 100%
risk category, except for first mortgage loans fully secured by residential property and,
under certain circumstances, residential construction loans, both of which carry a 50%
rating. Most investment securities are assigned to the 20% category, except for municipal
or state revenue bonds, which have a 50% rating, and direct obligations of or obligations
guaranteed by the United States Treasury or United States Government agencies, which have
a 0% rating.

The federal bank regulatory
authorities have also implemented a leverage ratio, which is Tier 1 capital as a
percentage of average total assets less intangibles, to be used as a supplement to the
risk-based guidelines. The principal objective of the leverage ratio is to place a
constraint on the maximum degree to which a bank holding company may leverage its equity
capital base. The minimum required leverage ratio for top-rated institutions is 3%, but
most institutions are required to maintain an additional cushion of at least 100 to 200
basis points.

FDICIA established a capital-based
regulatory scheme designed to promote early intervention for troubled banks and requires
the FDIC to choose the least expensive resolution of bank failures. The capital-based
regulatory framework contains five categories of compliance with regulatory capital
requirements, including well capitalized, adequately capitalized,
undercapitalized, significantly undercapitalized, and
critically undercapitalized. To qualify as a well capitalized
institution, a bank must have a leverage ratio of no less than 5%, a Tier 1 risk-based
ratio of no less than 6%, and a total risk-based capital ratio of no less than 10%, and
the Bank must not be under any order or directive from the appropriate regulatory agency
to meet and maintain a specific capital level. As of December 31, 2009, the Company and
The First, were qualified as well capitalized.

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Under the FDICIA regulations, the
applicable agency can treat an institution as if it were in the next lower category if the
agency determines (after notice and an opportunity for hearing) that the institution is in
an unsafe or unsound condition or is engaging in an unsafe or unsound practice. The degree
of regulatory scrutiny of a financial institution will increase, and the permissible
activities of the institution will decrease, as it moves downward through the capital
categories. Institutions that fall into one of the three undercapitalized categories may
be required to (i) submit a capital restoration plan; (ii) raise additional capital; (iii)
restrict their growth, deposit interest rates, and other activities; (iv) improve their
management; (v) eliminate management fees; or (vi) divest themselves of all or part of
their operations. Bank holding companies controlling financial institutions can be called
upon to boost the institutions capital and to partially guarantee the
institutions performance under their capital restoration plans.

These capital guidelines can affect
the Company in several ways. If the Company continues to grow at a rapid pace, a premature
squeeze on capital could occur making a capital infusion necessary. The
requirements could impact the Companys ability to pay dividends. The Companys
present capital levels are more than adequate; however, rapid growth, poor loan portfolio
performance, or poor earnings performance could change the Companys capital position
in a relatively short period of time.

Failure to meet these capital
requirements would mean that a bank would be required to develop and file a plan with its
primary federal banking regulator describing the means and a schedule for achieving the
minimum capital requirements. In addition, such a bank would generally not receive
regulatory approval of any application that requires the consideration of capital
adequacy, such as a branch or merger application, unless the Bank could demonstrate a
reasonable plan to meet the capital requirement within a reasonable period of time.

Enforcement Powers. FIRREA expanded
and increased civil and criminal penalties available for use by the federal regulatory
agencies against depository institutions and certain institution-affiliated
parties (primarily including management, employees, and agents of a financial
institution, independent contractors such as attorneys and accountants, and others who
participate in the conduct of the financial institutions affairs). These practices
can include the failure of an institution to timely file required reports; the filing of
false or misleading information; or the submission of inaccurate reports. Civil penalties
may be as high as $1,000,000 a day for such violations. Criminal penalties for some
financial institution crimes have been increased to twenty years. In addition, regulators
are provided with greater flexibility to commence enforcement actions against institutions
and institution-affiliated parties. Possible enforcement actions include the termination
of deposit insurance. Furthermore, FIRREA expanded the appropriate banking agencies
power to issue cease and desist orders that may, among other things, require affirmative
action to correct any harm resulting from a violation or practice, including restitution,
reimbursement, indemnifications, or guarantees against loss. A financial institution may
also be ordered to restrict its growth, dispose of certain assets, rescind agreements or
contracts, or take other actions as determined by the ordering agency to be appropriate.

Effect of Governmental Monetary
Policies. The earnings of the Bank are affected by domestic economic conditions and the
monetary and fiscal policies of the United States government and its agencies. The Federal
Reserve Boards monetary policies have had, and are likely to continue to have, an
important impact on the operating results of commercial banks through its power to
implement national monetary policy in order, among other things, to curb inflation or
combat a recession. The monetary policies of the Federal Reserve Board have major effects
upon the levels of bank loans, investments, and deposits through its open market
operations in United States government securities and through its regulation of the
discount rate on borrowings of member banks and the reserve requirements against member
bank deposits. It is not possible to predict the nature or impact of future changes in
monetary and fiscal policies.

Significant Legislative Developments.
On September 29, 1994, the federal government enacted the Riegle-Neal Interstate Banking
and Branching Efficiency Act of 1994 (the Interstate Banking Act). This Act
became effective on September 29, 1995, and permits eligible bank holding companies in any
state, with regulatory approval, to acquire banking organizations in any other state.
Since June 1, 1997, the Interstate Banking Act has allowed banks with different home
states to merge, unless a particular state opts out of the statute. In addition, beginning
June 1, 1997, the Interstate Banking Act has permitted national and state banks to
establish de novo branches in another state if there is a law in that state which applies
equally to all banks and expressly permits all out-of-state banks to establish de novo
branches.

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On November 12, 1999, the Gramm-
Leach-Bliley Act of 1999 (the Financial Services Modernization Act) was signed
into law. The Financial Services Modernization Act repeals the two affiliation provisions
of the Glass-Steagall Act: Section 20, which restricted the affiliation of Federal Reserve
Member Banks with firms engaged principally in specified securities
activities; and Section 32, which restricts officer, director, or employee interlocks
between a member bank and any company or person primarily engaged in specified
securities activities. In addition, the Financial Services Modernization Act also contains
provisions that expressly preempt any state law restricting the establishment of financial
affiliations, primarily related to insurance. The general effect of the law is to
establish a comprehensive framework to permit affiliations among commercial banks,
insurance companies, securities firms, and other financial service providers by revising
and expanding the BHCA framework to permit a holding company system to engage in a full
range of financial activities through a new entity known as a Financial Holding Company.
Financial activities is broadly defined to include not only banking,
insurance, and securities activities, but also merchant banking and additional activities
that the Federal Reserve, in consultation with the Secretary of the Treasury, determines
to be financial in nature, incidental to such financial activities, or complementary
activities that do not pose a substantial risk to the safety and soundness of depository
institutions or the financial system generally.

`Generally, the Financial Services Modernization Act:

                 Repeals historical restrictions on, and eliminates many federal and state law barriers
                  to, affiliations among banks, securities firms, insurance companies, and other
                  financial service providers;

                 Provides a uniform framework for the functional regulation of the activities of banks,
                  savings institutions, and their holding companies;

                 Broadens the activities that may be conducted by national banks, banking subsidiaries
                  of bank holding companies, and their financial subsidiaries;

                 Provides an enhanced framework for protecting the privacy of consumer information;

                 Adopts a number of provisions related to the capitalization, membership, corporate
                  governance, and other measures designed to modernize the Federal Home Loan Bank system;

                 Modifies the laws governing the implementation of the Community Reinvestment Act
                  ("CRA"); and

                 Addresses a variety of other legal and regulatory issues affecting both day-to-day
                  operations and long-term activities of financial institutions.`

In order for a bank holding company
to take advantage of the ability to affiliate with other financial services providers,
that company must become a Financial Holding Company as permitted under an
amendment to the BHCA. To become a Financial Holding Company, the company would file a
declaration with the Federal Reserve, electing to engage in activities permissible for
Financial Holding Companies and certifying that it is eligible to do so because all of its
insured depository institution subsidiaries are well-capitalized and well-managed. In
addition, the Federal Reserve must also determine that each insured depository institution
subsidiary of the Company has at least a satisfactory CRA rating.

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The Financial Services Modernization
Act also permits national banks to engage in expanded activities through the formation of
financial subsidiaries. A national bank may have a subsidiary engaged in any activity
authorized for national banks directly or any financial activity, except for insurance
underwriting, insurance investments, real estate investment or development, or merchant
banking, which may only be conducted through a subsidiary of a Financial Holding Company.
Financial activities include all activities permitted under new sections of the BHCA or
permitted by regulation.

A national bank seeking to have a
financial subsidiary, and each of its depository institution affiliates, must be
well-capitalized and well-managed. The total assets of all
financial subsidiaries may not exceed the lesser of 45% of a banks total assets, or
$50 billion. A national bank must exclude from its assets and equity all equity
investments, including retained earnings, in a financial subsidiary. The assets of the
subsidiary may not be consolidated with the banks assets. The bank must also have
policies and procedures to assess financial subsidiary risk and protect the bank from such
risks and potential liabilities.

The Financial Services Modernization
Act also includes a new section of the Federal Deposit Insurance Act governing
subsidiaries of state banks that engage in activities as principal that would only
be permissible for a national bank to conduct in a financial subsidiary. It
expressly preserves the ability of a state bank to retain all existing subsidiaries.
Because Mississippi permits commercial banks chartered by the state to engage in any
activity permissible for national banks, the state bank competitors of The First will be
permitted to form subsidiaries to engage in the activities authorized by the Financial
Services Modernization Act, to the same extent as The First. In order to form a financial
subsidiary, a state bank must be well-capitalized, and the state bank would be subject to
the same capital deduction, risk management and affiliate transaction rules as applicable
to national banks.

The Company and the Bank do not
believe that the Financial Services Modernization Act will have a material adverse effect
on operations in the near-term. However, to the extent that it permits banks, securities
firms, and insurance companies to affiliate, the financial services industry may
experience further consolidation. The Financial Services Modernization Act is intended to
grant to community banks certain powers as a matter of right that larger institutions have
accumulated on an ad hoc basis. Nevertheless, this act may have the result of increasing
the amount of competition that the Company and the Bank face from larger institutions and
other types of companies offering financial products, many of which may have substantially
more financial resources than the Company and the Bank.

In 2001, the Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism Act of 2001 (USA Patriot Act) was signed into law. The USA Patriot Act broadened
the application of anti-money laundering regulations to apply to additional types of
financial institutions, such as broker-dealers, and strengthened the ability of the U.S.
Government to detect and prosecute international money laundering and the financing of
terrorism. The principal provisions of Title III of the USA Patriot Act require that
regulated financial institutions, including state member banks: (i) establish an
anti-money laundering program that includes training and audit components; (ii) comply
with regulations regarding the verification of the identity of any person seeking to open
an account; (iii) take additional required precautions with non-U.S. owned accounts; and
(iv) perform certain verification and certification of money laundering risk for their
foreign correspondent banking relationships. The USA Patriot Act also expanded the
conditions under which funds in a U.S. interbank account may be subject to forfeiture and
increased the penalties for violation of anti-money laundering regulations. Failure of a
financial institution to comply with the USA Patriot Acts requirements could have
serious legal and reputational consequences for the institution. The Bank has adopted
policies, procedures and controls to address compliance with the requirements of the USA
Patriot Act under the existing regulations and will continue to revise and update its
policies, procedures and controls to reflect changes required by the USA Patriot Act and
implementing regulations.

In July 2002, Congress enacted the
Sarbanes-Oxley Act of 2002, which addresses, among other issues, corporate governance,
auditing and accounting, executive compensation, and enhanced and timely disclosure of
corporate information. Section 404 of the Sarbanes-Oxley Act, and regulations adopted by
the SEC require the Company to include in its Annual Report, a report stating
managements responsibility to establish and maintain adequate internal controls over
financial reporting and managements conclusion on the effectiveness of the internal
controls at year end. Additionally, the Companys independent registered public
accounting firm is required to attest to and report on managements evaluation of
internal control over financial reporting.

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From time to time, various bills are
introduced in the United States Congress with respect to the regulation of financial
institutions. Certain of these proposals, if adopted, could significantly change the
regulation of banks and the financial services industry. The Company cannot predict
whether any of these proposals will be adopted or, if adopted, how these proposals would
affect the Company.

Recent Legislative and Regulatory
Initiatives to Address Financial and Economic Crises. The Congress, Treasury Department
and the federal banking regulators, including the FDIC, have taken broad action since
early September, 2008 to address volatility in the U.S. banking system. See
Legislative and Regulatory Initiatives to Address Financial and Economic
Crises above.

Making or continuing an investment in
securities, including the Companys Common Stock, involves certain risks that you
should carefully consider. The risks and uncertainties described below are not the only
risks that may have a material adverse effect on the Company. Additional risks and
uncertainties also could adversely affect the Companys business and results of
operations. If any of the following risks actually occur, our business, financial
condition or results of operations could be affected, the market price for your securities
could decline, and you could lose all or a part of your investment. Further, to the extent
that any of the information contained in this Annual Report on Form 10-K constitutes
forward-looking statements, the risk factors set forth below also are cautionary
statements identifying important factors that could cause the Companys actual
results to differ materially from those expressed in any forward-looking statements made
by or on behalf of the Company.

We may be vulnerable to certain
sectors of the economy

A portion of the loan portfolio is
secured by real estate. If the economy deteriorated and depressed real estate values
beyond a certain point, that collateral value of the portfolio and the revenue stream from
those loans could come under stress and possibly require additional loan loss accruals.
Our ability to dispose of foreclosed real estate at prices above the respective carrying
values could also be impinged, causing additional losses.

Difficult market conditions have
adversely affected the industry in which we operate

The capital and credit markets have
been experiencing volatility and disruption for more than two years, causing volatility
and disruption to reach unprecedented levels. Dramatic declines in the housing market over
the past year, with falling home prices and increasing foreclosures, unemployment and
under-employment, have negatively impacted the credit performance of mortgage loans and
resulted in significant write-downs of asset values by financial institutions, including
government-sponsored entities as well as major commercial and investment banks. Reflecting
concern about the stability of the financial markets generally and the strength of
counterparties, many lenders have reduced or ceased providing funding to borrowers,
including to other financial institutions. This market turmoil and tightening of credit
have led to an increased level of commercial and consumer delinquencies, lack of consumer
confidence and widespread reduction of business activity generally. A worsening of these
conditions would likely exacerbate the adverse effects of these difficult market
conditions on us and others in the financial institution industry. Also, the economic
downturn could exacerbate our exposure to credit risk, particularly in our real estate
markets, as lower home prices and increased foreclosures may result in higher charge-offs
and delinquencies.

General economic conditions in the
areas where our operations or loans are concentrated may adversely affect our
customers ability to meet their obligations

A sudden or severe downturn in the
economy in the geographic markets we serve in the state of Mississippi may affect the
ability of our customers to meet loan payments obligations on a timely basis. The local
economic conditions in these areas have a significant impact on our commercial, real
estate, and construction loans, the ability of borrowers to repay these loans and the
value of the collateral securing such loans. Changes resulting in adverse economic
conditions of our market areas could negatively impact the financial results of the
Companys banking operations and its profitability.

Additionally, adverse economic
changes may cause customers to withdraw deposit balances, thereby causing a strain on our
liquidity.

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We are subject to a risk of rapid and
significant changes in market interest rates

Our assets and liabilities are
primarily monetary in nature, and as a result we are subject to significant risks tied to
changes in interest rates. Our ability to operate profitably is largely dependent upon net
interest income. Unexpected movement in interest rates markedly changing the slope of the
current yield curve could cause net interest margins to decrease, subsequently decreasing
net interest income. In addition, such changes could adversely affect the valuation of our
assets and liabilities.

At present the Companys
one-year interest rate sensitivity position is slightly asset sensitive, but a gradual
increase in interest rates during the next twelve months should not have a significant
impact on net interest income during that period. However, as with most financial
institutions, the Companys results of operations are affected by changes in interest
rates and the Companys ability to manage this risk. The difference between interest
rates charged on interest-earning assets and interest rates paid on interest-bearing
liabilities may be affected by changes in market interest rates, changes in relationships
between interest rate indices, and/or changes in the relationships between long-term and
short-term market interest rates. A change in this difference might result in an increase
in interest expense relative to interest income, or a decrease in the Companys
interest rate spread.

Certain changes in interest rates,
inflation, or the financial markets could affect demand for our products and our ability
to deliver products efficiently

Loan originations, and potentially
loan revenues, could be adversely impacted by sharply rising interest rates. Conversely,
sharply falling rates could increase prepayments within our securities portfolio lowering
interest earnings from those investments. An unanticipated increase in inflation could
cause operating costs related to salaries and benefits, technology, and supplies to
increase at a faster pace than revenues.

The fair market value of the
securities portfolio and the investment income from these securities also fluctuate
depending on general economic and market conditions. In addition, actual net investment
income and/or cash flows from investments that carry prepayment risk, such as
mortgage-backed and other asset-backed securities, may differ from those anticipated at
the time of investment as a result of interest rate fluctuations.

Changes in the policies of monetary
authorities and other government action could adversely affect profitability

The results of operations of the
Company are affected by credit policies of monetary authorities, particularly the Federal
Reserve Board. The instruments of monetary policy employed by the Federal Reserve Board
include open market operations in U.S. government securities, changes in the discount rate
or the federal funds rate on bank borrowings and changes in reserve requirements against
bank deposits. In view of changing conditions in the national economy and in the money
markets, particularly in light of the continuing threat of terrorist attacks and the
current military operations in the Middle East, we cannot predict possible future changes
in interest rates, deposit levels, loan demand or the Companys business and
earnings. Furthermore, the actions of the United States government and other governments
in responding to such terrorist attacks or the military operations in the Middle East may
result in currency fluctuations, exchange controls, market disruption and other adverse
effects.

Natural disasters could affect our
ability to operate

Our market areas are susceptible to
natural disasters such as hurricanes. Natural disasters can disrupt operations, result in
damage to properties and negatively affect the local economies in which we operate. The
Company cannot predict whether or to what extent damage caused by future hurricanes will
affect operations or the economies in our market areas, but such weather events could
cause a decline in loan originations, a decline in the value or destruction of properties
securing the loans and an increase in the risk of delinquencies, foreclosures or loan
losses.

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Greater loan losses than expected may
adversely affect our earnings

The Company as lender is exposed to
the risk that its customers will be unable to repay their loans in accordance with their
terms and that any collateral securing the payment of their loans may not be sufficient to
assure repayment. Credit losses are inherent in the business of making loans and could
have a material adverse effect on operating results. Credit risk with respect to its real
estate and construction loan portfolio will relate principally to the creditworthiness of
corporations and the value of the real estate serving as security for the repayment of
loans. Credit risk with respect to its commercial and consumer loan portfolio will relate
principally to the general creditworthiness of businesses and individuals within our local
markets.

The Company makes various assumptions
and judgments about the collectibility of its loan portfolio and provides an allowance for
estimated loan losses based on a number of factors. The Company believes that its current
allowance for loan losses is adequate. However, if our assumptions or judgments prove to
be incorrect, the allowance for loan losses may not be sufficient to cover actual loan
losses. We may have to increase the allowance in the future in response to the request of
one of its primary banking regulators, to adjust for changing conditions and assumptions,
or as a result of any deterioration in the quality of the loan portfolio. The actual
amount of future provisions for loan losses cannot be determined at this time and may vary
from the amounts of past provisions.

The First Bancshares may need to rely
on the financial markets to provide needed capital

The First Bancshares Common
Stock is listed and traded on the NASDAQ stock market. Although the Company anticipates
that its capital resources will be adequate for the foreseeable future to meet its capital
requirements, at times we may depend on the liquidity of the NASDAQ stock market to raise
equity capital. If the market should fail to operate, or if conditions in the capital
markets are adverse, First Bancshares may be constrained in raising capital. Should these
risks materialize, the ability to further expand its operations through internal growth
may be limited.

We are subject to regulation by
various Federal and State entities

The Company is subject to the
regulations of the Securities and Exchange Commission (SEC), the Federal
Reserve Board, the Federal Deposit Insurance Corporation, and the OCC. New regulations
issued by these agencies may adversely affect First Bancshares ability to carry on
its business activities. First Bancshares is subject to various Federal and state laws and
certain changes in these laws and regulations may adversely affect operations.

The Company is also subject to the
accounting rules and regulations of the SEC and the Financial Accounting Standards Board.
Changes in accounting rules could adversely affect the reported financial statements or
results of operations of First Bancshares and may also require extraordinary efforts or
additional costs to implement. Any of these laws or regulations may be modified or changed
from time to time, and we cannot be assured that such modifications or changes will not
adversely affect the Company.

We engage in acquisitions of other
businesses from time to time

On occasion, the Company will engage
in acquisitions of other businesses. Acquisitions may result in customer and employee
turnover, thus increasing the cost of operating the new businesses. The acquired companies
may also have legal contingencies, beyond those that First Bancshares is aware of, that
could result in unexpected costs.

We are subject to industry
competition which may have an impact upon its success

The profitability of the Company
depends on its ability to compete successfully. We operate in a highly competitive
financial services environment. Certain competitors are larger and may have more resources
than we do. We face competition in our regional market areas from other commercial banks,
savings and loan associations, credit unions, internet banks, finance companies, mutual
funds, insurance companies, brokerage and investment banking firms, and other financial
intermediaries that offer similar services. Some of the nonbank competitors are not
subject to the same extensive regulations that govern the Company or the Bank and may have
greater flexibility in competing for business.

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Another competitive factor is that
the financial services market, including banking services, is undergoing rapid changes
with frequent introductions of new technology-driven products and services. Our future
success may depend, in part, on our ability to use technology competitively to provide
products and services that provide convenience to customers and create additional
efficiencies in operations.

Future issuances of additional
securities could result in dilution of shareholders ownership

The Company may determine from time
to time to issue additional securities to raise additional capital, support growth, or to
make acquisitions. Further, the Company may issue stock options or other stock grants to
retain and motivate our employees. Such issuances of Company securities will dilute the
ownership interests of the Companys shareholders.

Anti-takeover laws and certain
agreements and charter provisions may adversely affect share value

Certain provisions of state and
federal law and the Companys articles of incorporation may make it more difficult
for someone to acquire control of the Company. Under federal law, subject to certain
exemptions, a person, entity, or group must notify the federal banking agencies before
acquiring 10% or more of the outstanding voting stock of a bank holding company, including
The First Bancshares shares. Banking agencies review the acquisition to determine if
it will result in a change of control. The banking agencies have 60 days to act on the
notice, and take into account several factors, including the resources of the acquiror and
the antitrust effects of the acquisition. There also are Mississippi statutory provisions
and provisions in the Companys articles of incorporation that may be used to delay
or block a takeover attempt. As a result, these statutory provisions and provisions in the
Companys articles of incorporation could result in the Company being less attractive
to a potential acquiror.

Securities issued by the Company,
including First Bancshares Common Stock, are not FDIC insured

Securities issued by the Company, including
The First Bancshares Common Stock, are not savings or deposit accounts or other
obligations of any bank and are not insured by the FDIC, the Deposit Insurance Fund, or
any other governmental agency or instrumentality, or any private insurer, and are subject
to investment risk, including the possible loss of principal.

There can be no assurance that
recently enacted legislation will stabilize the U.S. financial system

On October 3, 2008, President Bush
signed into law the EESA. The legislation was the result of a proposal by the Treasury in
response to the financial crises affecting the banking system and financial markets and
threats to investment banks and other financial institutions. Pursuant to the EESA, the
Treasury was given the authority to, among other things, purchase up to $700 billion of
mortgages, mortgage-backed securities and certain other financial instruments from
financial institutions for the purpose of stabilizing and providing liquidity to the U.S.
financial markets. On October 14, 2008, the Treasury announced the Capital Purchase
Program, a program under the EESA pursuant to which it would purchase senior preferred
stock and warrants to purchase common stock from participating financial institutions. On
November 21, 2008, the FDIC adopted a Final rule with respect to its Temporary Liquidity
Guarantee Program pursuant to which the FDIC can guarantee certain newly-issued
unsecured debt of banks and certain holding companies and also guarantee, on an
unlimited basis, noninterest-bearing bank transaction accounts. On February 17, 2009,
President Obama signed into law the ARRA. The purposes of the legislation are to preserve
and create jobs, to assist those most impacted by the recession, to provide investments to
increase economic efficiency in health services, to invest in transportation,
environmental protection and other infrastructure, and to stabilize local and state
governments.

Each of these programs was
implemented to help stabilize our economy and financial system. There can be no assurance,
however, as to the actual impact that the EESA and its implementing regulations, the
Capital Purchase Program, the FDIC programs, or any other governmental program will have
on the financial markets. The failure of the EESA, the ARRA or the U.S. government to
stabilize the financial markets and a continuation or worsening of current financial
market conditions could materially and adversely affect the Companys business,
financial condition, and results of operations, access to credit or the trading price of
the Companys common stock.

15

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The failure of other financial
institutions could adversely affect the Company

The Companys ability to engage
in routine funding transactions could be adversely affected by the actions and potential
failures of other financial institutions. Financial institutions are interrelated as a
result of trading, clearing, counterparty and other relationships. As a result, defaults
by, or even rumors or concerns about, one or more financial institutions or the financial
services industry generally have led to market-wide liquidity problems and could lead to
losses or defaults by the Company or by other institutions.

Concern by customers over deposit
insurance may cause a decrease in deposits and changes in the mix of funding sources
available to the Company

With recent increased concerns about
bank failures, customers increasingly are concerned about the extent to which their
deposits are insured by the FDIC. Customers may withdraw deposits in an effort to ensure
that the amount they have on deposit with their bank is fully insured and some may seek
deposit products or other bank savings and investment products that are collateralized.
Decreases in deposits and changes in the mix of funding sources may adversely affect the
Companys funding costs and net income.

Evaluation of investment securities
for other-than-temporary impairment involves subjective determinations and could
materially impact the Companys results of operations and financial condition

The evaluation of impairments is a
quantitative and qualitative process, which is subject to risks and uncertainties, and is
intended to determine whether declines in the fair value of investment should be
recognized in current period earnings. The risks and uncertainties include changes in
general economic conditions, the issuers financial condition or future recovery
prospects, the effects of changes in interest rates or credit spreads and the expected
recovery period. Estimating future cash flows involves incorporating information received
from third-party sources and making internal assumptions and judgments regarding the
future performance of the underlying collateral and assessing the probability that an
adverse change in future cash flows has occurred. The determination of the amount of
other-than-temporary impairments is based upon the Companys quarterly evaluation and
assessment of known and inherent risks associated with the respective asset class. Such
evaluations and assessments are revised as conditions change and new information becomes
available.

Additionally, the Companys
management considers a wide range of factors about the security issuer and uses its
reasonable judgment in evaluating the cause of the decline in the estimated fair value of
the security and in assessing the prospects for recovery. Inherent in managements
evaluation of the security are assumptions and estimates about the operations of the
issuer and its future earnings potential. Impairments to the carrying value of our
investment securities may need to be taken in the future, which would have a material
adverse effect on our results of operations and financial condition.

The Company may be required to pay
additional insurance premiums to the FDIC, which could negatively impact earnings

Recent insured institution failures,
as well as deterioration in banking and economic conditions, have significantly increased
FDIC loss provisions, resulting in a decline in the designated reserve ratio to historical
lows. The FDIC expects a higher rate of insured institution failures in the next few years
compared to recent years; thus, the reserve ratio may continue to decline. In addition,
the limit on FDIC coverage has been increased to $250,000 through December 31, 2013. These
developments have caused the premiums assessed to the Company by the FDIC to increase.

The Company is a participant in the
FDIC Temporary Liquidity Guarantee Program. Participating in this program requires the
payment of additional insurance premiums to the FDIC.

16

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Further, depending upon any future
losses that the FDIC insurance fund may suffer, there can be no assurance that there will
not be additional premium increases in order to replenish the fund. The FDIC may need to
set a higher base rate schedule or impose special assessments due to future financial
institution failures and updated failure and loss projections. Potentially higher FDIC
assessment rates than those currently projected could have an adverse impact on the
Companys results of operations.

`o   The Company received $5,000,000 in funding under the Capital Purchase Program in exchange for
         preferred stock and preferred stock warrants during 2009.  Participation in this program
         constrains the Company's ability to raise dividends and repurchase equity securities and also
         places certain constraints on executive compensation arrangements. The increased funding
         provides assurance that the Company can maintain its minimum regulatory capital ratios in the
         face of future large real estate-related losses.  The Company will have to repay these funds by
         raising capital within the next four years to keep its dividend costs from increasing to 9% per
         annum.

     o   The rules that govern the Capital Purchase Program include restrictions on certain compensation
         to executive officers and a number of others in the Company. Among other things, these rules
         include a prohibition on golden parachute payments, a prohibition on providing tax gross-ups, a
         bonus claw-back provision, and a prohibition on paying any bonus payment to the Company's most
         highly compensated employees. It is possible that compensation restrictions imposed by the
         Capital Purchase Program and the American Reinvestment and Recovery Act of 2009 could impede
         our ability to attract and retain qualified executive officers.

     o   Our participation in the Capital Purchase Program limits our quarterly dividend payments to no
         more than $.15 per share through the first quarter of 2012 without prior regulatory approval.
         Our ability to repurchase our common stock is also restricted.

     o   Since the Capital Purchase Program was part of legislation that has the reputation of being
         passed as a bailout of the financial industry, participation in the program could also create
         some reputational risk. This reputation of the program could impede the Company's ability to
         attract business in competition with other financial institutions that did not participate.
         This reputational risk could also impede the Company's ability to attract and retain qualified
         executive officers.`

As a result of the Companys
participation in the Capital Purchase Program (CPP), the Company may face additional
regulation and cannot predict the cost or effects of compliance at this time

In connection with the Companys
participation in the CPP, the Company and the Bank may face additional regulations and/or
reporting requirements, including, but not limited to, the following:

`o       Section 5.3 of the standardized Securities Purchase Agreement that the Company entered into
                  with the Treasury provides, in part, that the Treasury "may unilaterally amend any
                  provision of this Agreement to the extent required to comply with any changes after
                  the Signing Date in applicable federal statutes."  This provision could give Congress
                  the ability to impose "after-the-fact" terms and conditions on participants in the
                  CPP.  As a participant in the CPP, the Company would be subject to any such
                  retroactive legislation.  The Company cannot predict whether or in what form any
                  proposed regulation or statute will be adopted or the extent to which its business may
                  be affected by any new regulation or statute.`

17

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None

The First has a main office located
west of the city of Hattiesburg, Mississippi, in Lamar County. The main office is located
in a 13,000 square foot facility which the Company constructed and opened in January 1997
on a two acre plot of land at the southwest corner of U.S. Highway 98 and Old Highway 11.
The First also has a branch office located on Highway 15 North in the city of Laurel,
Mississippi, one on Highway 589 in the city of Purvis, Mississippi, which is in Lamar
County, a fourth office in a 3,300 square foot facility located at the intersection of
Lincoln Road and South 28th Avenue in Hattiesburg, a fifth office located in an 11,700
square foot building located at 110 S. 40th Ave. in Hattiesburg, a sixth office located on
Hwy 43 South, Picayune, MS in a 3,800 sq. ft. facility , a seventh office located at 1126
Jackson Ave in Pascagoula, MS, an eighth office located at Hwy 90 in Bay St. Louis, MS, a
ninth location on Border Ave. in Wiggins, MS, as well as a tenth location located at Hwy
49 and ONeal Rd. in Gulfport, MS.

The Company believes that the
Banks facilities will adequately serve its needs.

From time to time the Company and/or
the Bank may be named as defendants in various lawsuits arising out of the normal course
of business. On October 8, 2007, The First Bancshares, Inc. (the Company) and
its subsidiary, The First, A National Banking Association (the Bank) were
formally named as defendants and served with a First Amended Complaint in litigation
styled Nick D. Welch v. Oak Grove Land Company, Inc., Fred McMurry, David E. Johnson, J.
Douglas Seidenburg, The First, a National Banking Association, The First Bancshares, Inc.,
and John Does 1 through 10, Civil Action No. 2006-236-CV4, pending in the Circuit Court of
Jones County, Mississippi, Second Judicial District (the First Amended
Complaint).

The allegations by Welch against the
Company and the Bank include counts of 1) Intentional Misrepresentation and Omission; 2)
Negligent Misrepresentation and/or Omission; 3) Breach of Fiduciary Duty; 4) Breach of
Duty of Good Faith and Fair Dealing; and 5) Civil Conspiracy. The First Amended Complaint
served by Welch on October 8, 2007 added the Company and the Bank as defendants in this
ongoing litigation. The Plaintiff seeks damages from all the defendants, including
$2,957,385, annual dividends for the year 2006 in the amount of $.30 per share, punitive
damages, and attorneys fees and costs, and is more fully described in Form 8-K filed
by the Company on October 10, 2007. The Company and the Bank both deny any liability to
Welch, and they intend to defend vigorously against this lawsuit.

The Defendants removed the case to
the United States District Court for the Southern District of Mississippi, Hattiesburg
Division, on March 12, 2008, based upon the Courts federal question jurisdiction. On
April 11, 2008, the Plaintiff filed a Motion to Remand the case to the Circuit Court of
Jones County, Mississippi. The Motion to Remand was granted, and the case is currently
pending in the Circuit Court of Jones County, Mississippi, Second Judicial District. The
case is currently set for trial on June 14, 2010, in the Circuit Court of the Second
Judicial District of Jones County, Mississippi.

On January 29, 2010, the Circuit
Court of the Second Judicial District of Jones County, Mississippi entered an Agreed Order
granting Plaintiffs motion to amend his complaint to assert a declaratory judgment
action against Kansas Bankers Surety Company on the question of insurance coverage.

18

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PART II

In response to this Item, the
information contained on page 62 of the Companys Annual Report to Shareholders for
the year ended December 31, 2009, attached hereto as Exhibit 13, is incorporated herein by reference.

In response to this Item, the
information contained on page 7 of Managements Discussion and Analysis for the year
ended December 31, 2009, attached hereto as Exhibit 13, is incorporated herein by reference.

In response to this Item, the information contained on pages 6 through 27 of the
Company's Annual Report to Shareholders for the year ended December 31, 2009, attached hereto as Exhibit 13, is incorporated herein
by reference.

Not applicable.

In response to this Item, the information contained on pages 29 through 61 of the
Company's Annual Report to Shareholders for
the year ended December 31, 2009, attached hereto as Exhibit 13, is incorporated herein by reference.

Not applicable.

The Companys principal
executive officer and principal financial officer have concluded, based upon their
evaluation of the Companys disclosure controls and procedures as of December 31,
2009 that the Companys disclosure controls and procedures were effective. During the
quarter ended December 31, 2009, no changes have occurred in the Companys internal
control over financial reporting that have materially affected or are reasonably likely to
materially affect the Companys internal control over financial reporting.

Management of The First Bancshares,
Inc. and subsidiary (the Company) is responsible for establishing and
maintaining effective internal control over financial reporting. Internal control over
financial reporting is a process designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for
external purposes in accordance with U.S. generally accepted accounting principles.

Under the supervision and with the
participation of management, including the principal executive officer and principal
financial officer, the Company conducted an evaluation of the effectiveness of internal
control over financial reporting based on the framework in Internal Control 
Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway
Commission. Based on this evaluation, management of the Company has concluded the Company
maintained effective internal control over financial reporting, as such term is defined in
Securities Exchange Act of 1934 Rules 12a-15(f), as of December 31, 2009.

19

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Internal control over financial
reporting cannot provide absolute assurance of achieving financial reporting objectives
because of its inherent limitations. Internal control over financial reporting is a
process that involves human diligence and compliance and is subject to lapses in judgment
and breakdowns resulting from human failures. Internal control over financial reporting
can also be circumvented by collusion or improper management override. Because of such
limitations, there is a risk that material misstatements may not be prevented or detected
on a timely basis by internal control over financial reporting. These inherent
limitations, however, are known features of the financial reporting process. It is
possible, therefore, to design into the process safeguards to reduce, though not
eliminate, this risk.

This annual report does not include
an attestation report of the Companys independent registered public accounting firm
regarding internal control over financial reporting. The Companys registered public
accounting firm was not required to issue an attestation report on internal controls over
financial reporting pursuant to temporary rules of the Securities and Exchange Commission.

`/s/ M. Ray (Hoppy) Cole, Jr.                                /s/  Dee Dee Lowery
-------------------------------                             ----------------------------------------
CEO and President                                           Executive VP and Chief Financial Officer
March 25, 2010                                              March 25, 2010`

Not applicable.

PART III

In response to this Item, the
information contained under the captions, Election of Directors and
Additional Information Concerning Directors and Officers of the Companys
Proxy Statement for the Annual Meeting of Shareholders to be held on May 27, 2010, is
incorporated herein by reference.

Code of Ethics

The Companys Board of Directors
has adopted a Code of Ethics that applies to the Companys principal executive
officer, principal financial officer, principal accounting officer, or persons performing
similar functions. A copy of this Code of Ethics can be found at the Companys
internet website at www.thefirstbank.com. The Company intends to disclose any amendments
to its Code of Ethics, and any waiver from a provision of the Code of Ethics granted to
the Companys principal executive officer, principal financial officer, principal
accounting officer, or persons performing similar functions, on the Companys
internet website within five business days following such amendment or waiver. The
information contained on or connected to the Companys internet website is not
incorporated by reference into this Form 10-K and should not be considered part of this or
any other report that we file with or furnish to the SEC.

Audit Committee

The information contained under the
caption Committees of the Board of Directors of the Companys Proxy
Statement for the Annual Meeting of Shareholders to be held on May 27, 2010, is
incorporated herein by reference. The Board of Directors has determined that there is at
least one independent audit committee financial expert, J. Douglas Seidenburg, serving on
the Audit Committee, as the terms independent and audit committee financial expert are
used in pertinent Securities and Exchange Commission laws and regulations.

20

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Corporate Governance

The information contained under the
caption Additional Information Concerning Directors and Officers of the
Companys Proxy Statement for the Annual Meeting of Shareholders to be held on May
27, 2010, is incorporated herein by reference.

As a CPP/TARP recipient the Company
is required to have an Excessive Expenditure Policy. Such a policy was adopted by the
Companys Board of Directors on July 23, 2009, and is posted on the Banks
website at www.thefirstbank.com.

In response to this Item, the
information contained under the caption Compensation Discussion and Analysis
of the Companys Proxy Statement for the Annual Meeting of Shareholders to be held on
May 27, 2010, is incorporated herein by reference.

In response to this Item, the
information contained under the caption Security Ownership of Certain Beneficial
Owners and Management of the Companys Proxy Statement for the Annual Meeting
of Shareholders to be held on May 27, 2010, is incorporated herein by reference.

In response to this Item, the
information contained under the caption Certain Relationships and Related
Transactions of the Companys Proxy Statement for the Annual Meeting of
Shareholders to be held on May 27, 2010, is incorporated herein by reference.

In response to this Item, the
information contained under the caption Principal Accountant Fees and Services
of the Companys Proxy Statement for the Annual meeting of Shareholders to be held on
May 27, 2010, is incorporated herein by reference.

PART IV

The following exhibits are furnished
(or incorporated by reference):

`Exhibit Number          Description
   --------------          -----------

         3.1               Amended and Restated Articles of Incorporation (incorporated by reference to
                           Exhibit 3.1 to the Company's Registration Statement No. 33-94288 on Form S-1).

         3.2               Bylaws (incorporated by reference to Exhibit 3.2 to the Company's Registration
                           Statement No. 33-94288 on Form S-1).

         4.1               Provisions in the Company's Articles of Incorporation and Bylaws defining the
                           rights of holders of the Company's Common Stock (incorporated by reference to
                           Exhibit 4.1 to the Company's Registration Statement No. 33-94288 on Form S-1).

         4.2               Form of Certificate of Common Stock (incorporated by reference to Exhibit 4.2
                           to the Company's Registration Statement No. 33-94288 on Form S-1).`

21

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`10.5              Amended and restated employment agreement dated November 20, 1995, by and
                           between David E. Johnson and the Company (incorporated by reference to Exhibit
                           10.7 of the Company's Form 10-KSB for the fiscal  year ended December 31,
                           1995, File No. 33-94288).

         10.6              First Bancshares, Inc. 1997 Stock Option Plan as of March 18, 1997
                           (incorporated by reference to Exhibit 10.7 of the Company's Form 10-KSB for
                           the fiscal year ended December 31, 1996, File No. 33-94288).

         10.7              Agreement to Repurchase Stock by and among The First Bancshares, Inc., Nick
                           Welch and David Johnson  (incorporated by reference to Exhibit 10.9 to the
                           Company's Registration Statement No. 333-102908 on Form S-2).

         13                The Company's 2009 Annual Report

         21                Subsidiaries of the Company

         31                Rule 13a-14(a)/15d-14(a) Certifications

         32                Section 1350 Certifications

         99.1              EESA Certification of CEO

         99.2              EESA Certification of CFO`

22

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`SIGNATURES

         In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report
to be signed on its behalf by the undersigned, thereunto duly authorized.

                                                              THE FIRST BANCSHARES, INC.


Date: March 25, 2010                                          By: /s/ M. Ray (Hoppy) Cole, Jr.
                                                                 -----------------------------------
                                                                   M. Ray (Hoppy) Cole, Jr.
                                                                   Chief Executive Officer and
                                                                   President (Principal Executive
                                                                   Officer)

Date: March 25, 2010                                          By: /s/ Dee Dee Lowery
                                                                 -----------------------------------
                                                                   Dee Dee Lowery
                                                                   Executive VP and Chief
                                                                   Financial Officer
                                                                   (Principal Financial and Principal
                                                                   Accounting Officer)

         In accordance with the Exchange Act, this report has been signed below by the following persons
on behalf of the registrant and in the capacities and on the dates indicated.

SIGNATURES                                         CAPACITIES                        DATE
----------                                         ----------                        ----

/s/ E. Ricky Gibson                                Director                       March 25, 2010
----------------------------
/s/ Charles R. Lightsey                            Director                       March 25, 2010
----------------------------
/s/ J. Douglas Seidenburg                          Director                       March 25, 2010
----------------------------
/s/ Andy Stetelman                                 Director                       March 25, 2010
----------------------------
David W. Bomboy                                    Director
----------------------------                                                      -----------------
/s/ Ted E. Parker                                  Director                       March 25, 2010
----------------------------
/s/ Michael W. Chancellor                          Director                       March 25, 2010
----------------------------
/s/ Fred McMurry                                   Director                       March 25, 2010
----------------------------
/s/ Dennis L. Pierce                               Director                       March 25, 2010
----------------------------
/s/ Gregory Mitchell                               Director                       March 25, 2010
----------------------------
/s/ David E. Johnson                               Chairman of the Board          March 25, 2010
----------------------------                       and Director
/s/ M. Ray (Hoppy) Cole, Jr.                       CEO, President and Director    March 25, 2010
----------------------------                       (Principal Executive Officer)
/s/ Dee Dee Lowery                                 Executive VP & Chief       March 25, 2010
----------------------------                       Financial Officer
                                                   (Principal Financial and
                                                   Accounting Officer)`

23