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                                                                   Exhibit 10.5


                          KENSINGTON BANKSHARES, INC.
                          INCENTIVE AND NON-STATUTORY
                               STOCK OPTION PLAN


SECTION 1.        PURPOSE

         This 2001 Incentive and Non-Statutory Stock Option Plan (the "Plan")
is intended as a performance incentive for officers and employees of Kensington
Bankshares, Inc., a Florida corporation (the "Company") or its Subsidiaries (as
hereinafter defined) and for certain other individuals providing services to or
acting as directors of the Company or its Subsidiaries, to enable the persons
to whom options are granted (an "Optionee" or "Optionees") to acquire or
increase a proprietary interest in the success of the Company. The Company
intends that this purpose will be effected by the granting of incentive stock
options ("Incentive Options") as defined in Section 422A(b) of the Internal
Revenue Code of 1986 (the "Code") and other stock options ("Non-statutory
Options") under the Plan.

SECTION 2.        OPTIONS TO BE GRANTED AND ADMINISTRATION

         2.1      Options to the Granted. Options granted under the Plan may be
either Incentive Options or Non-statutory Options.

         2.2      Administration by the Board. This Plan shall be administered
by the Board of Directors of the Company (the "Board"). The Board shall have
full and final authority to operate, manage and administer the Plan on behalf
of the Company. This authority includes, but is not limited to: (i) the power
to grant options conditionally or unconditionally; (ii) the power to prescribe
the form or forms of the instruments evidencing options granted under this
Plan; (iii) the power to interpret the Plan; (iv) the power to provide
regulations for the operation of the incentive features of the Plan, and
otherwise to prescribe regulations for interpretation, management and
administration of the Plan; (v) the power to delegate responsibility for Plan
operation, management and administration on such terms, consistent with the
Plan, as the Board may establish; (vi) the power to delegate to other persons
the responsibility for performing ministerial acts in furtherance of the Plan's
purpose; and (vii) the power to engage the services of persons or organizations
in furtherance of the Plan's purpose, including but not limited to, banks,
insurance companies, brokerage firms and consultants.

         In addition, as to each option, the Board shall have full and final
authority in its discretion: (i) to determine the number of shares subject to
each option; (ii) to determine the time or times at which options will be
granted; (iii) to determine the time or times when each option shall become
exercisable and the duration of the exercise period, which shall not exceed the
limitations specified in Section 5.1.1; and (iv) to determine the option price
for the shares subject to each option, which price shall be subject to the
applicable requirements, if any, of Section 5.1.4 hereof.

         2.3      Appointment and Proceedings of Committee. The Board may
appoint a Stock Option Committee (the "Committee") which shall consist of at
least three members of the Board. The Board may from time to time appoint
members of the Committee in substitution for or in addition to members
previously appointed, and may fill vacancies, however caused, in the Committee.
The Committee shall select one of its members as its chairman and shall hold
its meetings at such times and places as it shall deem advisable. A majority of
its members shall constitute a quorum, and all actions of the Committee shall
be taken by a majority of its members. Any action may be taken by a written
instrument signed by all of the members, and any action so taken shall be as
fully effective as if it had been taken by a vote of a majority of the members
at a meeting duly called and held.


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         2.4      Powers of Committee. Subject to the provisions of this Plan
and the approval of the Board, the Committee shall have the power to make
recommendations to the Board as to whom options should be granted, the number
of shares to be covered by each option, the time or times of option grants, and
the terms and conditions of each option. In addition, the Committee shall have
authority to interpret the Plan, to prescribe, amend and rescind rules and
regulations relating to the Plan, and to exercise the administrative and
ministerial powers of the Board with regard to aspects of the Plan other than
the granting of options. The interpretation and construction by the Committee
of any provisions of the Plan or of any option granted hereunder and the
exercise of any power delegated to it hereunder shall be final, unless
otherwise determined by the Board. No member of the Board or the Committee
shall be liable for any action or determination made in good faith with respect
to the Plan or any option granted hereunder.

SECTION 3.        STOCK

         3.1      Shares Subject to Plans. The stock subject to the options
granted under the Plan shall be shares of the Company's authorized but unissued
common stock, par value $.01 per share ("Common Stock"). The total number of
shares that may be issued pursuant to options granted under the Plan shall not
exceed an aggregate of 350,000 shares of Common Stock.

         3.2      Lapsed or Unexercised Options. Whenever any outstanding
option under the Plan expires, is cancelled or is otherwise terminated (other
than by exercise), the shares of Common Stock allocable to the unexercised
portion of such option shall be restored to the Plan and be available for the
grant of other options under the Plan.

SECTION 4.        ELIGIBILITY

         4.1      Eligible Optionees. Incentive options may be granted only to
officers and other employees of the Company or its Subsidiaries, including
members of the Board who are also employees of the Company or a Subsidiary.
Non-statutory options may be granted to officers or other employees of the
Company or its Subsidiaries and to certain other individuals providing services
to the Company or its Subsidiaries. Non-employee directors may be granted
options to purchase in the aggregate up to 5,000 shares of the Company's Common
Stock.

         4.2      Limitations on 10% Stockholders. No Incentive Option shall be
granted to an individual who, as a result of the receipt of an Incentive
Option, would own (including ownership attributed pursuant to Section 425(d) of
the Code) more than 10% of the total combined voting power of all classes of
stock of the Company or any parent or Subsidiary of the Company (taking into
account the shares underlying the Incentive Option).

         4.3      Limitation on Exercisable Options. The aggregate fair market
value (determined at the time the Incentive Option is granted) of the Common
Stock with respect to which Incentive Options are exercisable for the first
time by any person during any calendar year under the Plan and under any other
option plan of the Company (or a parent or subsidiary as defined in Section 425
of the Code) shall not exceed $100,000. Any option granted in excess of the
foregoing limitation shall be specifically designated as being a Non-statutory
Option.


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SECTION 5.        TERMS OF THE OPTION AGREEMENTS

         5.1      Mandatory Terms. Each option agreement shall contain such
provisions as the Board or the Committee shall from time to time deem
appropriate, and shall include provisions relating to the method of exercise,
payment of exercise price, adjustments on changes in the Company's
capitalization and the effect of a merger, consolidation, liquidation, sale or
other disposition of or involving the Company. Option agreements need not be
identical, but each option agreement by appropriate language shall include the
substance of all of the following provisions:

         5.1.1    Expiration. Notwithstanding any other provision of the Plan
or of any option agreement, each option shall expire on the date specified in
the option agreement, which date shall not be later than the fifth anniversary
of the date on which the option was granted.

         5.1.2    Exercise. Each option shall be deemed exercised when (i) the
Company has received written notice of such exercise in accordance with the
terms of the option, (ii) full payment of the aggregate option price of the
shares of Common Stock as to which the option is exercised has been made, and
(iii) arrangements that are satisfactory to the Board or the Committee in its
sole discretion have been made for the optionee's payment to the Company of the
amount that is necessary for the Company or Subsidiary employing the optionee
to withhold in accordance with applicable Federal or state tax withholding
requirements. Unless further limited by the Board or the Committee in any
option, the option price of any shares of Common Stock purchased shall be paid
in cash, by certified or official bank check, by money order, with shares of
Common Stock or by a combination of the above; provided further, however, that
the Board or the Committee in its sole discretion may accept a personal check
in full or partial payment of any shares of Common Stock. If the exercise price
is paid in whole or in part with shares, the value of the shares surrendered
shall be their fair market value on the date the option is exercised as
determined in accordance with Section 5.1.4 hereof. No optionee shall be deemed
to be a holder of any shares of Common Stock subject to an option unless and
until a stock certificate or certificates for such shares of Common Stock are
issued to such person(s) under the terms of the Plan. No adjustment shall be
made for dividends (ordinary or extraordinary, whether in cash, securities or
other property) or distributions or other rights for which the record date is
prior to the date such stock certificate is issued, except as expressly
provided in Section 6 hereof. No optionee shall be deemed to be a holder of any
shares of Common Stock subject to an option unless and until a stock
certificate or certificates for such shares of Common Stock are issued to such
person(s) under the terms of the Plan.

         5.1.3    Events Causing Immediate Exercise. Unless otherwise provided
in any option, each outstanding option shall become immediately fully
exercisable.

         5.1.3.1  if there occurs any transaction (which shall include a series
of transactions occurring within 60 days or occurring pursuant to a plan), that
has the result that stockholders of the Company immediately before such
transaction cease to own at least 51 percent of the voting stock of the Company
or of any entity that results from the participation of the Company in a
reorganization, consolidation, merger, liquidation or any other form of
corporate transaction;

         5.1.3.2  if the stockholders of the Company shall approve a plan of
merger, consolidation, reorganization, liquidation or dissolution in which the
Company does not survive (unless the approved merger, consolidation,
reorganization, liquidation or dissolution is subsequently abandoned); or

         5.1.3.3  if the stockholders of the Company shall approve a plan for
the sale, lease, exchange or other disposition of all or substantially all the
property and assets of the Company (unless such plan is subsequently
abandoned).


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         The Board or the Committee may in its sole discretion accelerate the
date on which any option may be exercised and may accelerate the vesting of any
shares of Common Stock subject to any option or previously acquired by the
exercise of any option.

         5.1.4    Purchase Price. The purchase price per share of the Common
Stock under each Incentive Option shall be not less than the fair market value
of the Common Stock on the date the option is granted. The price at which
shares may be purchased pursuant to Non-statutory Options shall be specified by
the Board at the time the option is granted, and may be less than, equal to or
greater than the fair market value of the shares of Common Stock on the date
such Non-statutory Option is granted, but shall not be less than the par value
of shares of Common Stock.

         For the purpose of the Plan, the "fair market value" per share of
Common Stock on any date of reference shall be the Closing Price of the Common
Stock of the Company which is referred to in either clause (i), (ii) or (iii)
below, on the business day immediately preceding such date, or if not referred
to in either clause (i), (ii) or (iii) below, "fair market value" per share of
Common Stock shall be such value as shall be determined by the Board or the
Committee, unless the Board or the Committee in its sole discretion shall
determine otherwise in a fair and uniform manner. For this purpose, the Closing
Price of the Common Stock on any business day shall be (i) if the Common Stock
is listed or admitted for trading on any United States national securities
exchange, or if actual transactions are otherwise reported on a consolidated
transaction reporting system, the last reported sale price of Common Stock on
such exchange or reporting system, as reported in any newspaper of general
circulation, (ii) if the Common Stock is quoted on the National Association of
Securities Dealers Automated Quotations System ("NASDAQ"), or any similar
system of automated dissemination of quotations of securities prices in common
use, the mean between the closing high bid and low asked quotations for such
day of Common Stock on such system, or (iii) if neither clause (i) or (ii) is
applicable, the mean between the high bid and low asked quotations for the
Common Stock as reported by the National Quotation Bureau, Incorporated if at
least two securities dealers have inserted both bid and asked quotations for
Common Stock on at least five of the ten preceding days.

         5.1.5    Transferability of Options. Incentive options granted under
the Plan and the rights and privileges conferred thereby may not be
transferred, assigned, pledged or hypothecated in any manner (whether by
operation of law or otherwise) other than by will or by applicable laws of
descent and distribution, and shall not be subject to execution, attachment or
similar process. Upon any attempt so to transfer, assign, pledge, hypothecate
or otherwise dispose of any Incentive Option under the Plan or any right or
privilege conferred hereby, contrary to the provisions of the Plan, or upon the
sale or levy or any attachment or similar process upon the rights and
privileges conferred hereby, such option shall thereupon terminate and become
null and void. Non-statutory Options shall be transferable to the extent
provided in the option agreements under which they are granted.

         5.1.6    Termination of Employment, Death or Disability of Optionee.
Except as may be otherwise expressly provided in the terms and conditions of
the option granted to an Optionee, options granted hereunder shall terminate on
the earlier to occur of:

         5.1.6.1  the date of expiration thereof; or

         5.1.6.2  other than the case of death of the Optionee or disability of
the Optionee within the meaning of Section 22(e)(3) of the Code ("disability"),
(A) 90 days after termination of the employment between the Company and the
Optionee in the case of an Incentive Option, and (B) 90 days after termination
of the employment or other relationship between the Company and the Optionee,
unless such


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termination provision is waived by resolution adopted by the Board within 30
days of the termination of such relationship, in the case of a Non-statutory
Option.

         Except as may otherwise be expressly provided in the terms and
conditions of the option granted to an Optionee, in the event of the death of
an Optionee while in an employment or other relationship with the Company and
before the date of expiration of such option, such option shall terminate on
the earlier of such date of expiration or 180 days following the date of such
death. After the death of the Optionee, his executors, administrators or any
person or persons to whom his option may be transferred by will or by laws of
descent and distribution, shall have the right, at any time prior to such time
termination, to exercise the option to the extent the Optionee was entitled to
exercise such option immediately prior to his death.

         Except as may otherwise be expressly provided in the terms and
conditions of the option granted to an Optionee, if an Optionee's employment or
other relationship with the Company terminates because of a disability, the
Optionee's option shall terminate on the earlier of the date of expiration
thereof or 180 days following the termination of such relationship; and unless
by its terms it sooner terminates and expires during such 180 day period, the
Optionee may exercise that portion of his or her option which is exercisable at
the time of termination of such relationship.

         An employment relationship between the Company and the Optionee shall
be deemed to exist during any period during which the Optionee is employed by
the Company or by any Subsidiary. Whether authorized leave of absence or
absence on military government service shall constitute termination of the
employment relationship between the Company and the Optionee shall be
determined by the Board at the time thereof.

         5.1.7    Rights of Optionees. No Optionee shall be deemed for any
purpose to be the owner of any shares of Common Stock subject to any option
unless and until (i) the option shall have been exercised pursuant to the terms
thereof, (ii) the Company shall have issued and delivered the shares of the
Optionee, and (iii) the Optionee's name shall have been entered as a
stockholder of record on the books of the Company. Thereupon, the Optionee
shall have full voting, dividend and other ownership rights with respect to
such shares of Common Stock.

         5.2      Certain Optional Terms. The Board may in its discretion
provide, upon the grant of any option hereunder, that the Company shall have an
option to repurchase all or any number of shares purchased upon exercise of
such option. The repurchase price per share payable by the Company shall be
such amount or be determined by such formula as is fixed by the Board at the
time the option for the shares subject to repurchase was granted. The Board may
also provide that the Company shall have a right of first refusal with respect
to the transfer or proposed transfer of any shares purchased upon exercise of
an option granted hereunder. In the event the Board shall grant options subject
to the Company's repurchase rights or rights of first refusal, the certificate
or certificates representing the shares purchased pursuant to such option shall
carry a legend satisfactory to counsel for the Company referring to the
Company's repurchase option.


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SECTION 6.        ADJUSTMENT OF SHARES OF COMMON STOCK

         6.1      Increase or Decrease of Outstanding Shares. If at any time
while the Plan is in effect or unexercised options are outstanding, there shall
be any increase or decrease in the number of issued and outstanding shares of
Common Stock through the declaration of a stock dividend or through any
recapitalization resulting in a stock split-up, combination or exchange of
shares of Common Stock, then and in such event (i) appropriate adjustment shall
be made in the maximum number of shares of Common Stock available for grant
under the Plan, so that the same percentage of the Company's issued and
outstanding shares of Common Stock shall continue to be subject to being so
optioned, and (ii) appropriate adjustment shall be made in the number of shares
and the exercise price per share of Common Stock thereof then subject to any
outstanding option, so that the same percentage of the Company's issued and
outstanding shares of Common Stock shall remain subject to purchase at the same
aggregate exercise price.

         6.2      Discretionary Adjustment. Subject to the specific terms of
any option, the Board or the Committee may change the terms of options
outstanding under this Plan, with respect to the option price or the number of
shares of Common Stock subject to the options, or both, when, in the sole
discretion of the Board or the Committee, such adjustments become appropriate
by reason of a corporate transaction described in Section 5.1.4 hereof.

         6.3      Conversion of Shares. Except as otherwise expressly provided
herein, the issuance by the Company of shares of its capital stock of any
class, or securities convertible into shares of capital stock of any class,
either in connection with direct sale or upon the exercise of rights or
warrants to subscribe therefor, or upon conversion of shares or obligations of
the Company convertible into such shares or other securities, shall not affect,
and no adjustment by reason thereof shall be made with respect to the number of
or exercise price of shares of Common Stock then subject to outstanding options
granted under the Plan.

         6.4      General. Without limiting the generality of the foregoing,
the existence of outstanding options granted under the Plan shall not affect in
any manner the right or power of the Company to make, authorize or consummate
(i) any or all adjustments, recapitalizations, reorganizations or other changes
in the Company's capital structure or its business; (ii) any merger or
consolidation of the Company; (iii) any issue by the Company of debt
securities, or preferred or preference stock that would rank above the shares
subject to outstanding options; (iv) the dissolution or liquidation of the
Company; (v) any sale, transfer or assignment of all or any part of the assets
or business of the Company; or (vi) any other corporate act or proceeding,
whether of a similar character or otherwise.

SECTION 7.        AMENDMENT OF THE PLAN

         The Board may amend the Plan at any time, and from time to time,
subject to the limitation that no amendment shall be effective unless approved
by the stockholders of the Company in accordance with applicable law and
regulations at an annual or special meeting held within 12 months before or
after the date of adoption of such amendment, in any instance in which such
amendment would: (i) increase the number of shares of Common Stock as to which
options may be granted under the Plan; of (ii) change in substance the
provisions of Section 4 hereof relating to eligibility to participate in the
Plan.

         Rights and obligations under any option granted before any amendment
of the Plan shall not be altered or impaired by such amendment, except with the
consent of the Optionee.


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SECTION 8.        NON-EXCLUSIVITY OF THE PLAN

         Neither the adoption of the Plan by the Board nor the approval of the
Plan by the stockholders of the Company shall be construed as creating any
limitations on the power of the Board to adopt such other incentive
arrangements as it may deem desirable, including without limitation the
granting the stock options otherwise than under the Plan, and such arrangements
may be either applicable generally or only in specific cases.

SECTION 9.        GOVERNMENT AND OTHER REGULATIONS; GOVERNING LAW

         The obligation of the Company to sell and delivery shares of Common
Stock with respect to options granted under the Plan shall be subject to all
applicable laws, rules and regulations, including all applicable federal and
state securities laws, and the obtaining of all such approvals by government
agencies as may be deemed necessary or appropriate by the Board or the
Committee. All shares sold under the Plan shall bear appropriate legends. The
Plan shall be governed by and construed in accordance with the laws of the
State of Florida.

SECTION 10.       EFFECTIVE DATE OF PLAN

         The effective date of the Plan is April 9, 2001, the date on which it
was approved by the Board and by the stockholders of the Company. No option may
be granted under the Plan after the tenth anniversary of such effective date.


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