Exhibit
10.3(a)(1)





AMENDMENT
TO


THE
SUPPLEMENTAL INCOME AGREEMENT


BY
AND BETWEEN FIRST SOUTH BANK AND SHERRY L. CORRELL





This
Amendment to the Supplemental Income Agreement by and between FIRST SOUTH BANK(the “Bank”)
and Sherry L. Correll
(“Executive”) is entered into as of December 26, 2008.




WHEREAS, Executive and the
Bank previously entered into a Supplemental Income Agreement dated July 1, 1989
which was amended and restated on December 14, 1995 and subsequently amended
(the “Agreement”); and





WHEREAS, Executive and the
Bank desire to amend the Agreement to comply with the requirements of
Section 409A of the Internal Revenue Code of 1986, as amended.




NOW, THEREFORE, in
consideration of the mutual covenants and agreements set forth herein and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree to amend the as
follows:





FIRST
CHANGE





All
references in the Agreement to New South Bancorp, Inc. shall be replaced with
First South Bancorp, Inc.





SECOND
CHANGE





Section 5
of the Agreement shall be amended by deleting the last three (3) paragraphs
thereof which address the implementation of a grantor trust.





THIRD
CHANGE





The
following new Section 7 shall be added to the Agreement:





“Section
7.Section
409A





This
Agreement shall at all times be administered and the provisions of this
Agreement shall be interpreted consistent with the requirements of Section
409A.  For purposes of this Agreement, Section 409A shall refer to
Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and
the Treasury regulations and any other authoritative guidance issued
thereunder.  Any modification to the terms of this Agreement that
would inadvertently result in an additional tax liability on the part of the
Employee shall have no effect, provided the change in the terms of the Agreement
are rescinded by the earlier of a date before the right is exercised (if the
change grants a discretionary right) and the last day of the calendar year
during which such change occurred.





On or
before December 31, 2008, if the Employee wishes to change his or her election
as to the form or timing of the payment under this Agreement, the Employee may
do so by completing a Transition Relief Election Form, provided that any such
election (i) must be made prior to the Employee’s separation from service, (ii)
shall not take effect before the date that is 12 months after the date the
election is made, (iii) cannot apply to amounts that would otherwise be payable
in 2008 and may not cause an amount to be paid in 2008 that would otherwise be
paid in a later year.








Changes
to elections under this Agreement after December 31, 2008: (i) may not
accelerate the payment of benefits, (ii) must be made at least 12 months prior
to the scheduled distribution date, and (iii) must postpone payment (or the
commencement of payments) for at least five (5) years from the scheduled
distribution date.





Despite
any contrary provision of this Agreement, if, when an Employee’s service
terminates, the Employee is a “specified employee,” as defined in Section 409A
of the Code, and if any payments under this Agreement will result in additional
tax or interest to the Employee because of Section 409A of the Code, the
Employee shall not be entitled to the such payments until the earliest of (i)
the date that is at least six months after termination of the Employee’s
employment for reasons other than the Employee’s death, (ii) the date of the
Employee’s death, or (iii) any earlier date that does not result in additional
tax or interest to the Employee under Section 409A of the Code.”





FOURTH
CHANGE





The third
paragraph of Section 4 of the Agreement shall be amended in its entirety as
follows:





“Except
as otherwise provided in Sections 2 or 3 as applicable, in the event that, on or
before the occurrence of an Employee’s Retirement Age or Early Retirement Date,
a “Termination of Protected Employment” occurs following a Change in Control (as
defined herein), then the Employee shall be deemed to have retired as of his
Early Retirement Date and the Employee may elect to receive the present value of
his accrued benefit in a lump sum or elect to receive his benefits in accordance
with Section 1 of this Agreement.  Said election must be made in
accordance with Section 7 of this Agreement.





An
Employee will be deemed to have a termination of employment for purposes of
determining the timing of any payments under this Agreement only upon a
“separation from service” within the meaning of Section 409A of the
Code.”





FIFTH
CHANGE





Section 1
of this Agreement shall be deleted in its entirety effective as of the
restatement of this Agreement and reserved for future use.





Except as
expressly provided herein, the terms and conditions of the Agreement shall
remain in full force and effect and shall be binding on the parties hereto until
the expiration of the term of the Agreement.  Effectiveness of this
Amendment to the Agreement shall be conditioned upon approval by the Board of
Directors of the Bank (or appropriate committee thereof), and this Amendment to
the Supplemental Income Agreement shall become effective on the later of date of
such approval and execution by both parties hereto.





IN WITNESS WHEREOF, the
parties have duly executed and delivered this Amendment to the Agreement, as of
the day and year first above written.





ATTEST:
                    
                    FIRST SOUTH BANK/s/ William L. Wall
                    
                    /s/ Frederick N.
HolscherChairman
      of the BoardWITNESS:
                    
                    EXECUTIVE/s/ William L. Wall
                    
                    /s/ Sherry L. CorrellSherry
      L. Correll





Exhibit
10.3(a)(2)





AMENDMENT
TO


THE
SUPPLEMENTAL INCOME AGREEMENT


BY
AND BETWEEN FIRST SOUTH BANK AND THOMAS A. VANN





This
Amendment to the Supplemental Income Agreement by and between FIRST SOUTH BANK(the “Bank”)
and Thomas A. Vann
(“Executive”) is entered into as of December 26, 2008.




WHEREAS, Executive and the
Bank previously entered into a Supplemental Income Agreement dated July 1, 1989
which was amended and restated on December 14, 1995 and subsequently amended
(the “Agreement”); and




WHEREAS, Executive and the
Bank desire to amend the Agreement to comply with the requirements of
Section 409A of the Internal Revenue Code of 1986, as amended.




NOW, THEREFORE, in
consideration of the mutual covenants and agreements set forth herein and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree to amend the as
follows:





FIRST
CHANGE





All
references in the Agreement to New South Bancorp, Inc. shall be replaced with
First South Bancorp, Inc.





SECOND
CHANGE





Section 5
of the Agreement shall be amended by deleting the last three (3) paragraphs
thereof which address the implementation of a grantor trust.





THIRD
CHANGE





The
following new Section 7 shall be added to the Agreement:





“Section
7.Section
409A





This
Agreement shall at all times be administered and the provisions of this
Agreement shall be interpreted consistent with the requirements of Section
409A.  For purposes of this Agreement, Section 409A shall refer to
Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and
the Treasury regulations and any other authoritative guidance issued
thereunder.  Any modification to the terms of this Agreement that
would inadvertently result in an additional tax liability on the part of the
Employee shall have no effect, provided the change in the terms of the Agreement
are rescinded by the earlier of a date before the right is exercised (if the
change grants a discretionary right) and the last day of the calendar year
during which such change occurred.





On or
before December 31, 2008, if the Employee wishes to change his or her election
as to the form or timing of the payment under this Agreement, the Employee may
do so by completing a Transition Relief Election Form, provided that any such
election (i) must be made prior to the Employee’s separation from service, (ii)
shall not take effect before the date that is 12 months after the date the
election is made, (iii) cannot apply to amounts that would otherwise be payable
in 2008 and may not cause an amount to be paid in 2008 that would otherwise be
paid in a later year.








Changes
to elections under this Agreement after December 31, 2008: (i) may not
accelerate the payment of benefits, (ii) must be made at least 12 months prior
to the scheduled distribution date, and (iii) must postpone payment (or the
commencement of payments) for at least five (5) years from the scheduled
distribution date.





Despite
any contrary provision of this Agreement, if, when an Employee’s service
terminates, the Employee is a “specified employee,” as defined in Section 409A
of the Code, and if any payments under this Agreement will result in additional
tax or interest to the Employee because of Section 409A of the Code, the
Employee shall not be entitled to the such payments until the earliest of (i)
the date that is at least six months after termination of the Employee’s
employment for reasons other than the Employee’s death, (ii) the date of the
Employee’s death, or (iii) any earlier date that does not result in additional
tax or interest to the Employee under Section 409A of the Code.”





FOURTH
CHANGE





The third
paragraph of Section 4 of the Agreement shall be amended in its entirety as
follows:





“Except
as otherwise provided in Sections 2 or 3 as applicable, in the event that, on or
before the occurrence of an Employee’s Retirement Age or Early Retirement Date,
a “Termination of Protected Employment” occurs following a Change in Control (as
defined herein), then the Employee shall be deemed to have retired as of his
Early Retirement Date and the Employee may elect to receive the present value of
his accrued benefit in a lump sum or elect to receive his benefits in accordance
with Section 1 of this Agreement.  Said election must be made in
accordance with Section 7 of this Agreement.





An
Employee will be deemed to have a termination of employment for purposes of
determining the timing of any payments under this Agreement only upon a
“separation from service” within the meaning of Section 409A of the
Code.”





FIFTH
CHANGE





The first
paragraph in Section 2 is deleted in its entirety and replaced with the
following new paragraph:





Except as
otherwise specifically provided herein, if the Employee shall retire from
employment with the Bank either at or after the age of 65 (the “Retirement Age”)
or at or after age 55 with at least 10 years of service with the Bank (“Early
Retirement Date”), the Employee shall be entitled to the annual retirement
benefit set forth on Exhibit A to this Agreement (based on years of service with
the Bank after July 1, 1990).





The
Employee may elect to receive his benefit in annual installments over a fifteen
year period or he may elect to receive the present value of his fifteen year
benefit in a lump sum.  Benefits under this Agreement will be paid (or
commence to be paid) within 10 days of the Employee’s Retirement Age or Early
Retirement Date (whichever is applicable).  Said election must be made
in accordance with Section 7 of this Agreement.”





SIXTH
CHANGE





Section 1
of this Agreement shall be deleted in its entirety effective as of the
restatement of this Agreement and reserved for future use.





Except as
expressly provided herein, the terms and conditions of the Agreement shall
remain in full force and effect and shall be binding on the parties hereto until
the expiration of the term of the Agreement.  Effectiveness of this
Amendment to the Agreement shall be conditioned upon approval by the Board of
Directors of the Bank (or appropriate committee thereof), and this Amendment to
the Supplemental Income Plan Agreement shall become effective on the later of
date of such approval and execution by both parties hereto.





IN WITNESS WHEREOF, the
parties have duly executed and delivered this Amendment to the Agreement, as of
the day and year first above written.




ATTEST:
                    
                    FIRST SOUTH BANK/s/ William L. Wall
                    
                    /s/ Frederick N.
HolscherChairman
      of the BoardWITNESS:
                    
                    EXECUTIVE/s/ William L. Wall
                    
                    /s/ Thomas A. VannThomas
      A. Vann