EXHIBIT 10.12


	
  

 
	
 Floridian Bank 

 
	
 Salary Continuation Agreement

 
	

 


 



FLORIDIAN BANK 

SALARY CONTINUATION AGREEMENT


          This
Salary Continuation Agreement (this “Agreement”) is adopted this 31st day
of March, 2009, by and between FLORIDIAN BANK, a state-chartered commercial bank
located in Daytona Beach, Florida (the “Company”), and THOMAS DARGAN (the “Executive”).


          The
purpose of this Agreement is to provide specified benefits to the Executive, a member of a select group
of management or highly compensated employees who contribute materially to the
continued growth, development and future business success of the Company. This Agreement shall be
unfunded for tax purposes and for purposes of Title I of the Employee
Retirement Income Security Act of 1974 (“ERISA”), as amended from time to time.


Article 1 
Definitions


          Whenever
used in this Agreement, the following words and phrases shall have the meanings specified:


	
  

 	
  

 
	
 1.1

 	
 “Accrual Balance” means the liability that
 should be accrued by the Company, under Generally Accepted Accounting Principles
 (“GAAP”), for the Company’s obligation to the Executive under this Agreement,
 by applying Accounting Principles Board Opinion Number 12 (“APB 12”) as amended by
 Statement of Financial Accounting Standards Number
 106 (“FAS 106”) and the Discount Rate. Any one of a variety of amortization methods
 may be used to determine the Accrual Balance. However, once chosen, the method must be consistently applied.

 
	
  

 	
  

 
	
 1.2

 	
 “Beneficiary” means each designated person or
 entity, or the estate of the deceased Executive, entitled to any benefits upon the
 death of the Executive pursuant to Article 4.

 
	
  

 	
  

 
	
 1.3

 	
 “Beneficiary
 Designation Form” means the form established from time to time by the Plan Administrator that the Executive completes,
 signs and returns to the Plan Administrator
 to designate one or more Beneficiaries.

 
	
  

 	
  

 
	
 1.4

 	
 “Board” means the Board of Directors of the
 Company as from time to time constituted.

 
	
  

 	
  

 
	
 1.5

 	
 “Change in Control” means a change in the ownership
 or effective control of the Company, or in the ownership of a substantial
 portion of the assets of the Company, as such change is defined in Code Section 409A and
 regulations thereunder.

 
	
  

 	
  

 
	
 1.6

 	
 “Code” means the Internal Revenue Code of 1986,
 as amended, and all regulations and guidance thereunder, including such regulations and guidance as may
 be promulgated after the Effective Date.

 













	
  

 
	
 Floridian Bank

 
	
 Salary Continuation Agreement

 
	

 


 






	
  

 	
  

 
	
 1.7

 	
 “Disability” means the Executive: (i) is unable
 to engage in any substantial gainful activity by reason of any medically determinable
 physical or mental impairment which can be expected to result in death or can be
 expected to last for a continuous period of not less than twelve (12)
 months; or (ii) is, by reason of any medically determinable physical or mental impairment
 which can be expected to result in death or can be expected to last for a continuous
 period of not less than twelve (12) months, receiving income replacement benefits
 for a period of not less than three (3) months under an accident and health plan covering
 employees or directors of the Company. Medical determination of Disability may be
 made by either the Social Security Administration or by the provider of disability insurance
 covering employees or directors of the Company provided that the definition of
 “disability” applied under such insurance program complies with the requirements of the
 preceding sentence. Upon the request of the Plan Administrator, the Executive must submit
 proof to the Plan Administrator of the Social Security Administration’s or
 the provider’s determination.

 
	
  

 	
  

 
	
 1.8

 	
 “Discount Rate” means the rate used by the Plan
 Administrator for determining the Accrual Balance. The initial Discount Rate is
 six percent (6%). However, the Plan Administrator, in its discretion, may adjust
 the Discount Rate to maintain the rate within reasonable standards according to GAAP and/or
 applicable bank regulatory guidance.

 
	
  

 	
  

 
	
 1.9

 	
 “Early Termination” means the Executive’s
 Separation from Service before attainment of Normal Retirement Age
 except when such Separation from Service occurs following a Change in Control or
 due to death, Disability or Termination for Cause.

 
	
  

 	
  

 
	
 1.10

 	
 “Effective Date” means April 1, 2009.

 
	
  

 	
  

 
	
 1.11

 	
 “Normal Retirement Age” means December 31 after
 the Executive’s attainment of age sixty-five (65).

 
	
  

 	
  

 
	
 1.12

 	
 “Normal Retirement Date” means the later of
 Normal Retirement Age or Separation from Service.

 
	
  

 	
  

 
	
 1.13

 	
 “Plan Administrator” means the Board or such
 committee or person as the Board shall appoint.

 
	
  

 	
  

 
	
 1.14

 	
 “Plan Year” means each twelve (12) month period
 commencing on January 1 and ending on December 31 of each year.

 
	
  

 	
  

 
	
 1.15

 	
 “Separation
 from Service” means termination of the Executive’s employment with the Company for reasons other than death. Whether a
 Separation from Service has occurred is determined in accordance with the requirements of Code Section 409A
 based on whether the facts and
 circumstances indicate that the Company and Executive reasonably anticipated
 that no further services would be performed after a certain date or that the level of bona fide services the Executive would
 perform after such date (whether as an employee or as an independent contractor) would permanently decrease
 to no more than

 


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 Floridian Bank

 
	
 Salary Continuation Agreement

 
	

 


 






	
  

 	
  

 
	
  

 	
 twenty percent (20%) of the average level of bona fide
 services performed (whether as an employee or an independent contractor) over the
 immediately preceding thirty-six (36) month period (or the full period of services
 to the Company if the Executive has been providing services to the Company
 less than thirty-six (36) months).

 
	
  

 	
  

 
	
 1.16

 	
 “Specified Employee” means an employee who at
 the time of Separation from Service is a key employee of the Company, if any stock of
 the Company is publicly traded on an established securities market or otherwise. For
 purposes of this Agreement, an employee is a key employee if the employee meets the requirements of Code
 Section 416(i)(l)(A)(i), (ii), or (iii) (applied in accordance with the
 regulations thereunder and disregarding
 section 416(i)(5)) at any time during the twelve (12) month period ending on December 31 (the “identification period”). If
 the employee is a key employee during an identification period, the employee is treated as a key employee for
 purposes of this Agreement during the twelve (12) month period that begins on
 the first day of April following
 the close of the identification period.

 
	
  

 	
  

 
	
 1.17

 	
 “Termination for Cause” means Separation from
 Service for any of the following reasons:

 
	
  

 	
  

 
	
  

 	
 (a) If the Executive shall fail or refuse to comply with
 the obligations required of him as set forth in his Employment Agreement or comply with
 the policies of the Company established by the Board from time to time; provided,
 however, that for the first such failure or refusal, the Executive shall be given
 written warning (providing at least a ten (10) day period for an opportunity to cure), and
 the second failure or refusal shall be grounds for termination for Cause;

 
	
  

 	
  

 
	
  

 	
 (b) If the Executive shall have engaged in conduct
 involving fraud, deceit, personal dishonesty, or breach of fiduciary duty, or any
 other conduct which has adversely affected, or may adversely affect, the business
 or reputation of the Company;

 
	
  

 	
  

 
	
  

 	
 (c) If the Executive shall have violated any
 banking law or regulation, memorandum of understanding, cease and desist order, or other agreement with any
 banking agency having jurisdiction over
 the Company;

 
	
  

 	
  

 
	
  

 	
 (d) If the Executive shall have become subject to
 continuing intemperance in the use of alcohol or drugs which has adversely
 affected, or may adversely affect, the business or reputation of the Company,
 or has been convicted of a crime involving moral turpitude;

 
	
  

 	
  

 
	
  

 	
 (e) If the Executive shall have filed, or had filed
 against him, any petition under the federal bankruptcy laws or any state insolvency
 laws; or

 
	
  

 	
  

 
	
  

 	
 (f) If the Executive shall fail to achieve mutually
 agreed upon performance standards established from time to time.

 


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 Floridian Bank

 
	
 Salary Continuation Agreement

 
	

 


 


Article 2

Distributions During Lifetime


	
  

 	
  

 	
  

 
	
 2.1

 	
 Normal Retirement Benefit. Upon Separation from
 Service after attaining Normal Retirement Age, the Company shall distribute to the
 Executive the benefit described in this Section 2.1 in lieu of any other benefit
 under this Article.

 
	
  

 	
  

 	
  

 
	
  

 	
 2.1.1

 	
 Amount of Benefit. The annual benefit
 under this Section 2.1 is One Hundred Forty Thousand Dollars ($140,000).

 
	
  

 	
  

 	
  

 
	
  

 	
 2.1.2

 	
 Distribution of Benefit. The Company shall
 distribute the annual benefit to the Executive in twelve (12) equal monthly
 installments commencing on the first day of the month following the Normal Retirement
 Date. The annual benefit shall be distributed to the Executive for fifteen (15)
 years.

 
	
  

 	
  

 	
  

 
	
 2.2

 	
 Early Termination Benefit. If Early
 Termination occurs, the Company shall distribute to the Executive the
 benefit described in this Section 2.2 in lieu of any other benefit under this Article.

 
	
  

 	
  

 	
  

 
	
  

 	
 2.2.1

 	
 Amount of Benefit. The benefit under
 this Section 2.2 is the Accrual Balance determined as of the end of the Plan Year
 preceding Separation from Service subject to the Vesting Percentage. Interest
 shall be credited from Separation from Service to Normal Retirement Age at a
 rate equal to the Discount Rate in effect at the time of Separation from
 Service.

 





	
  

 	
  

 	
  

 
	
 Date in Which Separation from
Service Occurs 

 	
  

 	
 Vesting Percentage 

 
	

 


 	
  

 	

 


 
	
 04/01/09-12/30/09

 	
  

 	
 0%

 
	
 12/31/09-12/30/10

 	
  

 	
 10%

 
	
 12/31/010-12/30/11

 	
  

 	
 20%

 
	
 12/31/11-12/30/12

 	
  

 	
 30%

 
	
 12/31/12-12/30/13

 	
  

 	
 40%

 
	
 12/31/13-12/30/14

 	
  

 	
 50%

 
	
 12/31/14-12/30/15

 	
  

 	
 60%

 
	
 12/31/15-12/30/16

 	
  

 	
 70%

 
	
 12/31/16-12/30/17

 	
  

 	
 80%

 
	
 12/31/17-12/30/18

 	
  

 	
 90%

 
	
 On or After 12/31/18

 	
  

 	
 100%

 





	
  

 	
  

 	
  

 
	
  

 	
 2.2.2

 	
 Distribution of Benefit.
 The Company shall distribute the benefit to the Executive in one hundred eighty (180) equal monthly
 installments commencing on the first day
 of the month following Normal Retirement Age. Interest shall be credited
 during the installment period at a rate equal to the Discount Rate in effect
 at the time of Separation from
 Service.

 


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 Floridian Bank

 
	
 Salary Continuation Agreement

 
	

 


 






	
  

 	
  

 	
  

 
	
 2.3

 	
 Disability
 Benefit. If the
 Executive experiences a Disability, the Company shall distribute to the Executive the benefit
 described in this Section 2.3 in lieu of any other benefit under this Article.

 
	
  

 	
  

 	
  

 
	
  

 	
 2.3.1

 	
 Amount
 of Benefit. The benefit
 under this Section 2.3 is one hundred percent (100%) of the Accrual Balance determined as of the date of Disability.

 
	
  

 	
  

 	
  

 
	
  

 	
 2.3.2

 	
 Distribution
 of Benefit. The Company
 shall distribute the benefit to the Executive in a lump sum the first of the
 month following Disability.

 
	
  

 	
  

 	
  

 
	
 2.4

 	
 Change in Control
 Benefit. If a Change in Control occurs, the Company shall
 distribute to the Executive the benefit
 described in this Section 2.4 in lieu of any other benefit under this Article.

 
	
  

 	
  

 	
  

 
	
  

 	
 2.4.1

 	
 Amount
 of Benefit. The benefit
 under this Section 2.4 is the present value (using the Discount Rate in effect at the time of the
 Change in Control) of the Accrual Balance
 required at Normal Retirement Age to pay the benefit described in Sections 2.1.1 and 2.1.2. Interest shall be
 credited to this amount during the installment
 period at a rate equal to the Discount Rate in effect at the time of Change in Control.

 
	
  

 	
  

 	
  

 
	
  

 	
 2.4.2

 	
 Distribution
 of Benefit. The Company
 shall distribute the benefit under this Section 2.4 to the Executive in thirty-six (36) equal monthly
 installments commencing on the
 first day of the month following Change in Control.

 
	
  

 	
  

 	
  

 
	
 2.5

 	
 Restriction
 on Commencement of Distributions. Notwithstanding any provision of this Agreement to the contrary, if the Executive is considered a Specified
 Employee, the provisions of this
 Section 2.5 shall govern all distributions hereunder. If benefit distributions which would otherwise be made to
 the Executive due to Separation from Service
 are limited because the Executive is a Specified Employee, then such distributions shall not be made during the
 first six (6) months following Separation from Service. Rather, any
 distribution which would otherwise be paid to the Executive during such period shall be accumulated and paid to the
 Executive in a lump sum on the first day of the seventh month
 following Separation from Service. All subsequent distributions shall be paid in the manner specified.

 
	
  

 	
  

 	
  

 
	
 2.6

 	
 Distributions Upon
 Taxation of Amounts Deferred. If, pursuant to Code Section
 409A, the Federal Insurance Contributions
 Act or other state, local or foreign tax, the Executive becomes subject to tax on the amounts deferred
 hereunder, then the Company may make a limited distribution to the
 Executive in a manner that conforms to the requirements of Code section 409A. Any such distribution will
 decrease the Executive’s benefits distributable
 under this Agreement.

 


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 Floridian Bank

 
	
 Salary Continuation Agreement

 
	

 


 






	
  

 	
  

 	
  

 	
  

 
	
 2.7

 	
 Change
 in Form or Timing of Distributions. For distribution of benefits under this Article 2, the Executive and the Company may,
 subject to the terms of Section 8.1, amend this Agreement to delay the timing or change the form of distributions,
 Any such amendment:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (a)

 	
 may
 not accelerate the time or schedule of any distribution, except as provided in Code Section 409A;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (b)

 	
 must,
 for benefits distributable under Section 2.2, 2.3 and 2.4, be made at least twelve (12) months prior to the first
 scheduled distribution;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (c)

 	
 must,
 for benefits distributable under Sections 2.1, 2.2, 2.3 and 2.4, delay the
 commencement of distributions for a minimum of five (5) years from the date the first distribution was originally
 scheduled to be made; and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (d)

 	
 must take effect not
 less than twelve (12) months after the amendment is made.

 
	
  

 	
  

 	
  

 	
  

 
	
 Article 3

 
	
 Distribution at Death

 
	
  

 	
  

 	
  

 	
  

 
	
 3.1

 	
 Death During Active Service.
 If the Executive dies prior to Separation from Service, the Company shall distribute to the Beneficiary the benefit
 described in this Section 3.1, This benefit shall be distributed in lieu of
 any benefit under Article 2.

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 3.1.1

 	
 Amount
 of Benefit. The benefit
 under this Section 3.1 is the Accrual Balance (using the Discount Rate in effect at the time of the Executive’s
 death) required at Normal Retirement Age to pay the benefit described in
 Sections 2.1.1 and 2.1.2.

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 3.1.2

 	
 Distribution
 of Benefit. The Company
 shall distribute the benefit to the Beneficiary
 in a lump sum the first day of the fourth month following the Executive’s death, The Beneficiary shall be
 required to provide to the Company the
 Executive’s death certificate.

 
	
  

 	
  

 	
  

 	
  

 
	
 3.2

 	
 Death
 During Distribution of a Benefit. If the Executive dies after any benefit distributions have commenced under this Agreement
 but before receiving all such distributions,
 the Company shall distribute to the Beneficiary the remaining benefits at the
 same time and in the same amounts
 they would have been distributed to the Executive had the Executive survived.

 
	
  

 	
  

 	
  

 	
  

 
	
 3.3

 	
 Death
 Before Benefit Distributions Commence. If the Executive is entitled to benefit distributions under this Agreement but dies
 prior to the date that commencement of said benefit distributions are
 scheduled to be made under this Agreement, the Company shall distribute
 to the Beneficiary the same benefits to which the Executive was entitled
 prior to death, except that the benefit
 distributions shall be paid in the manner specified in Section 3.1.2 and shall commence the first day
 of the fourth month following the

 


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 Floridian Bank

 
	
 Salary Continuation Agreement

 
	

 


 






	
  

 	
  

 
	
  

 	
 Executive’s
 death. The Beneficiary shall be required to provide to the Company the Executive’s death certificate.

 
	
  

 	
  

 
	
 Article 4

 
	
 Beneficiaries

 
	
  

 	
  

 
	
 4.1

 	
 In
 General. The Executive
 shall have the right, at any time, to designate a Beneficiary to receive
 any benefit distributions under this Agreement upon the death of the
 Executive. The Beneficiary designated under this Agreement may be the same as
 or different from the beneficiary
 designated under any other plan of the Company in which the Executive participates.

 
	
  

 	
  

 
	
 4.2

 	
 Designation. The Executive shall designate a Beneficiary
 by completing and signing the Beneficiary
 Designation Form and delivering it to the Plan Administrator or its designated agent. If the Executive names
 someone other than the Executive’s spouse as a Beneficiary, the Plan Administrator may, in its sole discretion,
 determine that spousal consent is
 required to be provided in a form designated by the Plan Administrator, executed by the Executive’s spouse and returned
 to the Plan Administrator. The Executive’s
 beneficiary designation shall be deemed automatically revoked if the Beneficiary predeceases the Executive or if the
 Executive names a spouse as Beneficiary and the marriage is subsequently dissolved. The Executive shall have
 the right to change a Beneficiary
 by completing, signing and otherwise complying with the terms of the Beneficiary
 Designation Form and the Plan Administrator’s rules and procedures. Upon the acceptance by the Plan Administrator of a new
 Beneficiary Designation Form, all Beneficiary designations previously filed
 shall be cancelled. The Plan Administrator shall be entitled to rely
 on the last Beneficiary Designation Form filed by the Executive and accepted by the Plan Administrator prior to
 the Executive’s death.

 
	
  

 	
  

 
	
 4.3

 	
 Acknowledgment. No designation or change in designation of a
 Beneficiary shall be effective
 until received, accepted and acknowledged in writing by the Plan
 Administrator or its designated
 agent.

 
	
  

 	
  

 
	
 4.4

 	
 No
 Beneficiary Designation.
 If the Executive dies without a valid beneficiary designation, or if all designated Beneficiaries
 predecease the Executive, then the Executive’s
 spouse shall be the designated Beneficiary. If the Executive has no surviving
 spouse, any benefit shall be paid
 to the Executive’s estate.

 
	
  

 	
  

 
	
 4.5

 	
 Facility
 of Distribution. If the
 Plan Administrator determines in its discretion that a benefit is to be distributed to a minor, to a
 person declared incompetent or to a person incapable of handling the disposition of that person’s property, the
 Plan Administrator may direct
 distribution of such benefit to the guardian, legal representative or person having
 the care or custody of such minor, incompetent person or incapable person.
 The Plan Administrator may require proof of
 incompetence, minority or guardianship as it may deem appropriate
 prior to distribution of the benefit. Any distribution of a benefit shall be a distribution for the account of the
 Executive and the Beneficiary, as the case

 


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 Floridian Bank

 
	
 Salary Continuation Agreement

 
	

 


 






	
  

 	
  

 
	
  

 	
 may be, and shall
 completely discharge any liability under this Agreement for such distribution amount.

 
	
  

 	
  

 
	
 Article 5

 
	
 General
 Limitations

 
	
  

 	
  

 
	
 5.1

 	
 Termination
 for Cause. Notwithstanding
 any provision of this Agreement to the contrary, the Company shall not distribute any benefit
 under this Agreement if the Executive’s employment with the Company is terminated by the Company or an
 applicable regulator due to a
 Termination for Cause.

 
	
  

 	
  

 
	
 5.2

 	
 Suicide
 or Misstatement. No
 benefit shall be distributed if the Executive commits suicide within two (2) years after the Effective Date,
 or if an insurance company which issued a life insurance policy covering the Executive and owned by the Company
 denies coverage (i) for material
 misstatenients of fact made by the Executive on an application for such life insurance, or (ii) for any other reason.

 
	
  

 	
  

 
	
 5.3

 	
 Removal. Notwithstanding any provision of this
 Agreement to the contrary, the Company
 shall not distribute any benefit under this Agreement if the Executive is
 subject to a final removal or prohibition order issued by an
 appropriate federal banking agency pursuant
 to Section 8(e) of the Federal Deposit Insurance Act. Notwithstanding
 anything herein to the contrary, any payments made to the Executive pursuant
 to this Agreement, or otherwise, shall be subject to and conditioned
 upon compliance with 12 U.S.C. 1828 and
 FDIC Regulation 12 CFR Part 359, Golden Parachute Indemnification Payments
 and any other regulations or guidance promulgated thereunder.

 
	
  

 	
  

 
	
 5.4

 	
 Forfeiture
 Provision. The
 Executive shall forfeit any non-distributed benefits under this Agreement if during the term of this Agreement
 and within twelve (12) months following a Separation from Service, the Executive, directly or indirectly,
 either as an individual or as a
 proprietor, stockholder, partner, officer, director, employee, agent,
 consultant or independent contractor
 of any individual, partnership, corporation or other entity (excluding an ownership interest of three
 percent (3%) or less in the stock of a publicly-traded company):

 
	
  

 	
  

 
	
  

 	
 (i)     becomes
 employed by, participates in, or becomes connected in any manner with the ownership, management, operation or control
 of any bank, savings and loan or other similar financial institution if the Executive’s responsibilities will
 include providing banking or other
 financial services within twenty five (25) miles of any office maintained by
 the Company as of the date of the termination of the Executive’s employment;

 
	
  

 	
  

 
	
  

 	
 (ii)     participates
 in any way in hiring or otherwise engaging, or assisting any other person or entity in hiring or otherwise
 engaging, on a temporary, part-time or permanent basis, any individual who
 was employed by the Company as of the date of termination of the Executive’s employment;

 


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 Floridian Bank

 
	
 Salary Continuation Agreement

 
	

 


 






	
  

 	
  

 
	
  

 	
 (iii)     assists,
 advises, or serves in any capacity, representative or otherwise, any third party in any action against the Company or
 transaction involving the Company;

 
	
  

 	
  

 
	
  

 	
 (iv)     sells,
 offers to sell, provides banking or other financial services, assists any
 other person in selling or providing
 banking or other financial services, or solicits or otherwise competes for, either
 directly or indirectly, any orders, contract, or accounts for services of a kind or nature like or substantially similar to
 the financial services performed or financial
 products sold by the Company (the preceding hereinafter referred to as “Services”), to or from any person or entity
 from whom the Executive or the Company, to the knowledge of the Executive provided banking or other financial
 services, sold, offered to sell or solicited orders, contracts or
 accounts for Services during the one (1) year
 period immediately prior to the termination of the Executive’s employment;

 
	
  

 	
  

 
	
  

 	
 (v)     divulges,
 discloses, or communicates to others in any manner whatsoever, any confidential information of the Company, to the
 knowledge of the Executive, including, but not limited to, the names and addresses of customers or
 prospective customers, of the Company,
 as they may have existed from time to time, of work performed or services rendered
 for any customer, any method and/or procedures relating to projects or other work developed for the Company, earnings or other
 information concerning the Company.
 The restrictions contained in this subparagraph (v) apply to all information regarding the Company, regardless of the source
 who provided or compiled such information.
 Notwithstanding anything to the contrary, all information referred to herein shall not be disclosed unless and until it
 becomes known to the general public from sources other than the Executive.

 
	
  

 	
  

 
	
 5.5

 	
 Change
 in Control. The
 forfeiture provision detailed in Section 5.4 hereof shall not be enforceable following a Change in Control.

 
	
  

 	
  

 
	
 Article 6

 
	
 Administration of Agreement

 
	
  

 	
  

 
	
 6.1

 	
 Plan
 Administrator Duties.
 The Plan Administrator shall administer this Agreement according to its express terms and shall also
 have the discretion and authority to (i) make, amend, interpret and
 enforce all appropriate rules and regulations for the administration of this Agreement and (ii) decide or resolve any
 and all questions, including interpretations
 of this Agreement, as may arise in connection with this Agreement to the extent
 the exercise of such discretion and authority does not conflict with Code
 Section 409A.

 
	
  

 	
  

 
	
 6.2

 	
 Agents.
 In the administration of this Agreement, the Plan Administrator may employ agents and delegate to them such administrative
 duties as the Plan Administrator sees fit, including acting through a duly appointed representative, and may from
 time to time consult with counsel
 who may be counsel to the Company.

 
	
  

 	
  

 
	
 6.3

 	
 Binding
 Effect of Decisions. Any
 decision or action of the Plan Administrator with

 


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 Floridian Bank

 Salary Continuation Agreement

 
	

 


 






	
  

 	
  

 	
  

 
	
  

 	
 respect to any question arising out of or in connection
 with the administration, interpretation or application of this Agreement and
 the rules and regulations promulgated hereunder shall be final and conclusive and
 binding upon all persons having any interest in this Agreement.

 
	
  

 	
  

 	
  

 
	
 6.4

 	
 Indemnity of Plan Administrator. The Company shall
 indemnify and hold harmless the Plan
 Administrator against any and all claims, losses, damages, expenses or
 liabilities arising from any action or failure to act with respect to this
 Agreement, except in the case of willful
 misconduct by the Plan Administrator.

 
	
  

 	
  

 	
  

 
	
 6.5

 	
 Company Information. To enable the Plan
 Administrator to perform its functions, the Company shall supply full and timely information
 to the Plan Administrator on all matters relating to the date and circumstances of the
 Executive’s death, Disability or Separation from Service, and such other pertinent
 information as the Plan Administrator may reasonably require.

 
	
  

 	
  

 	
  

 
	
 6.6

 	
 Annual
 Statement. The Plan
 Administrator shall provide to the Executive, within one hundred twenty (120) days after the end of each
 Plan Year, a statement setting forth the benefits to be distributed
 under this Agreement.

 
	
  

 	
  

 	
  

 
	
 Article 7

 Claims And Review Procedures

 
	
  

 	
  

 	
  

 
	
 7.1

 	
 Claims Procedure. An Executive or
 Beneficiary (“claimant”) who has not received benefits under this Agreement that he or she believes should be
 distributed shall make a claim for such
 benefits as follows:

 
	
  

 	
  

 	
  

 
	
  

 	
 7.1.1

 	
 Initiation
 – Written Claim. The claimant initiates a claim by
 submitting to the Plan Administrator a
 written claim for the benefits. If such a claim relates to the contents of a notice received by the claimant,
 the claim must be made within sixty (60) days after such notice was received
 by the claimant. All other claims must be made within one hundred
 eighty (180) days of the date on which the event that caused the claim to arise occurred. The claim must state with
 particularity the determination
 desired by the claimant.

 
	
  

 	
  

 	
  

 
	
  

 	
 7.1.2

 	
 Timing
 of Plan Administrator Response. The Plan Administrator shall respond to such claimant within ninety (90) days after receiving the claim. If
 the Plan Administrator determines
 that special circumstances require additional time for processing the claim, the Plan Administrator
 can extend the response period by an additional ninety (90) days by notifying
 the claimant in writing, prior to the end of the initial ninety (90) day period, that an additional period is
 required. The notice of extension
 must set forth the special circumstances and the date by which the Plan
 Administrator expects to render its decision.

 


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 Floridian Bank

 Salary Continuation Agreement

 
	

 


 






	
  

 	
  

 	
  

 	
  

 
	
  

 	
 7.1.3

 	
 Notice of Decision. If the Plan
 Administrator denies part or all of the claim, the Plan Administrator shall notify the
 claimant in writing of such denial. The Plan Administrator shall write the
 notification in a manner calculated to be understood by the claimant. The notification shall set forth:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (a)

 	
 The specific reasons for
 the denial;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (b)

 	
 A
 reference to the specific provisions of this Agreement on which the denial is based;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (c)

 	
 A description of any additional information or material
 necessary for the claimant to perfect the claim and an explanation of why it is needed;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (d)

 	
 An
 explanation of this Agreement’s review procedures and the time limits applicable to such procedures; and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (e)

 	
 A statement of the claimant’s right to bring a civil
 action under ERISA Section 502(a) following an adverse benefit
 determination on review.

 
	
  

 	
  

 	
  

 	
  

 
	
 7.2

 	
 Review Procedure. If the Plan
 Administrator denies part or all of the claim, the claimant shall have the
 opportunity for a full and fair review by the Plan Administrator of the denial as follows:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 7.2.1

 	
 Initiation – Written Request.
 To initiate the review, the claimant, within sixty (60) days after receiving the Plan Administrator’s notice of denial,
 must file with the Plan Administrator a written request for review.

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 7.2.2

 	
 Additional Submissions – Information Access. The claimant shall
 then have the opportunity to submit written comments, documents, records and other information relating
 to the claim. The Plan Administrator shall also provide the claimant, upon request and free of charge,
 reasonable access to, and copies of, all documents,
 records and other information relevant (as defined in applicable ERISA
 regulations) to the claimant’s claim for benefits.

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 7.2.3

 	
 Considerations
 on Review. In
 considering the review, the Plan Administrator shall take into account all
 materials and information the claimant submits relating to the claim, without regard to whether such
 information was submitted or considered in the initial benefit
 determination.

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 7.2.4

 	
 Timing
 of Plan Administrator Response. The Plan Administrator shall respond in writing to such claimant within sixty (60) days after receiving the
 request for review. If the Plan
 Administrator determines that special circumstances require additional time for processing the claim, the
 Plan Administrator can extend the response
 period by an additional sixty (60) days by notifying the claimant in writing, prior to the end of the initial sixty
 (60) day period, that an additional period is required. The notice of
 extension must set forth the special circumstances
 and the date by which the Plan Administrator expects to render its decision.

 


11









	
  

 
	
 Floridian Bank

 Salary Continuation Agreement

 
	

 


 






	
  

 	
  

 	
  

 	
  

 
	
  

 	
 7.2.5

 	
 Notice of Decision. The Plan
 Administrator shall notify the claimant in writing of its decision on
 review. The Plan Administrator shall write the notification in a manner calculated to
 be understood by the claimant. The notification shall set forth:

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (a)

 	
 The specific reasons for
 the denial;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (b)

 	
 A
 reference to the specific provisions of this Agreement on which the denial is based;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (c)

 	
 A statement that the claimant is entitled to receive,
 upon request and free of charge, reasonable access to, and copies of, all
 documents, records and other
 information relevant (as defined in applicable ERISA regulations) to the claimant’s claim for benefits; and

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (d)

 	
 A
 statement of the claimant’s right to bring a civil action under ERISA Section 502(a).

 
	
  

 	
  

 	
  

 	
  

 
	
 Article 8

 Amendments and Termination

 
	
  

 	
  

 	
  

 	
  

 
	
 8.1

 	
 Amendments. This Agreement may be amended only by a
 written agreement signed by the Company and the Executive. However, the Company
 may unilaterally amend this Agreement to conform with written directives to the
 Company from its auditors or banking regulators or to comply with legislative
 changes or tax law, including without limitation Code Section 409A.

 
	
  

 	
  

 
	
 8.2

 	
 Plan Termination Generally. This Agreement may
 be terminated only by a written agreement signed by the Company and the Executive. The
 benefit shall be the Accrual Balance as of the date this Agreement is terminated.
 Except as provided in Section 8.3, the termination of this Agreement shall not
 cause a distribution of benefits under this Agreement. Rather, upon such
 termination benefit distributions will be made at the earliest distribution event permitted under
 Article 2 or Article 3.

 
	
  

 	
  

 
	
 8.3

 	
 Plan Terminations Under Code Section 409A. Notwithstanding
 anything to the contrary in Section 8.2, if the Company terminates this
 Agreement in the following circumstances:

 
	
  

 	
  

 
	
  

 	
 (a)

 	
 Within thirty (30) days before or twelve (12) months
 after a Change in Control, provided that all distributions are made no later
 than twelve (12) months following
 such termination of this Agreement and further provided that all the Company’s arrangements which are substantially
 similar to this Agreement are terminated so the Executive and all
 participants in the similar arrangements are required to receive all
 amounts of compensation deferred under the terminated arrangements within
 twelve (12) months of such termination;

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 Upon the Company’s dissolution or with the approval of a
 bankruptcy court provided that the amounts deferred under this Agreement
 are included in the Executive’s gross income in the latest of (i) the calendar year in
 which this Agreement
 terminates; (ii) the calendar year in which the amount is no longer

 


12









	
  

 
	
 Floridian Bank

 Salary Continuation Agreement

 
	

 


 






	
  

 	
  

 	
  

 
	
  

 	
  

 	
 subject to a substantial risk of forfeiture; or (iii)
 the first calendar year in which the distribution is administratively practical; or

 
	
  

 	
  

 	
  

 
	
  

 	
 (c)

 	
 Upon
 the Company’s termination of this and all other arrangements that would be aggregated with this Agreement pursuant to
 Treasury Regulations Section 1.409A-l(c)
 if the Executive participated in such arrangements (“Similar Arrangements”),
 provided that (i) the termination and liquidation does not occur proximate to a downturn in the financial health
 of the Company, (ii) all termination
 distributions are made no earlier than twelve (12) months and no later than
 twenty-four (24) months following such termination, and (iii) the Company does not adopt any new arrangement that would
 be a Similar Arrangement for a minimum of three (3) years following
 the date the Company takes all necessary action
 to irrevocably terminate and liquidate the Agreement;

 
	
  

 	
  

 	
  

 
	
  

 	
 the Company may distribute the Accrual Balance,
 determined as of the date of the termination of this Agreement, to the Executive
 in a lump sum subject to the above terms.

 
	
  

 	
  

 	
  

 
	
 Article 9

 Miscellaneous

 
	
  

 	
  

 	
  

 
	
 9.1

 	
 Binding
 Effect. This
 Agreement shall bind the Executive and the Company and their beneficiaries,
 survivors, executors, administrators and transferees.

 
	
  

 	
  

 	
  

 
	
 9.2

 	
 No
 Guarantee of Employment. This Agreement is not a contract for employment. It does not give the Executive the right to remain as an
 employee of the Company nor interfere with the Company’s right to
 discharge the Executive. It does not require the Executive to remain an employee nor interfere with the
 Executive’s right to terminate employment at any time.

 
	
  

 	
  

 	
  

 
	
 9.3

 	
 Non-Transferability. Benefits under this Agreement cannot be
 sold, transferred, assigned, pledged,
 attached or encumbered in any manner.

 
	
  

 	
  

 	
  

 
	
 9.4

 	
 Tax
 Withholding and Reporting. The Company shall withhold any taxes that are required to be withheld, including but not limited to
 taxes owed under Code Section 409A from the benefits provided under this Agreement. The Executive acknowledges
 that the Company’s sole liability
 regarding taxes is to forward any amounts withheld to the appropriate taxing authorities. The Company
 shall satisfy all applicable reporting requirements, including those under Code Section 409A.

 
	
  

 	
  

 	
  

 
	
 9.5

 	
 Applicable Law. This Agreement and
 all rights hereunder shall be governed by the laws of the State of Florida, except to the
 extent preempted by the laws of the United States of America.

 
	
  

 	
  

 	
  

 
	
 9.6

 	
 Unfunded Arrangement. The Executive and the
 Beneficiary are general unsecured creditors of the Company for the distribution of
 benefits under this Agreement. The benefits represent the mere promise by the Company to distribute such
 benefits. The

 


13









	
  

 
	
 Floridian Bank

 Salary Continuation Agreement

 
	

 


 






	
  

 	
  

 
	
  

 	
 rights
 to benefits are not subject in any manner to anticipation, alienation, sale,
 transfer, assignment, pledge, encumbrance,
 attachment or garnishment by creditors. Any insurance on the
 Executive’s life or other informal funding asset is a general asset of the Company to which the Executive and Beneficiary
 have no preferred or secured claim.

 
	
  

 	
  

 
	
 9.7

 	
 Reorganization. The Company shall
 not merge or consolidate into or with another bank, or reorganize, or sell
 substantially all of its assets to another bank, firm or person unless such succeeding or
 continuing bank, firm or person agrees to assume and discharge the obligations of the
 Company under this Agreement. Upon the occurrence of such an event, the term
 “Company” as used in this Agreement shall be deemed to refer to the successor or survivor
 entity.

 
	
  

 	
  

 
	
 9.8

 	
 Entire Agreement. This Agreement
 constitutes the entire agreement between the Company and the Executive as to the subject
 matter hereof. No rights are granted to the Executive by virtue of this Agreement other than those specifically
 set forth herein.

 
	
  

 	
  

 
	
 9.9

 	
 Interpretation. Wherever the fulfillment of the intent and
 purpose of this Agreement requires and the context will permit, the use of the
 masculine gender includes the feminine and use of the singular includes the plural.

 
	
  

 	
  

 
	
 9.10

 	
 Alternative Action. In the event it
 shall become impossible for the Company or the Plan Administrator to
 perform any act required by this Agreement due to regulatory or other constraints, the
 Company or Plan Administrator may perform such alternative act as most nearly carries out the
 intent and purpose of this Agreement and is in the best interests of the Company, provided that such alternative
 act does not violate Code Section 409A.

 
	
  

 	
  

 
	
 9.11

 	
 Headings. Article and section headings are for
 convenient reference only and shall not control or affect the meaning or construction of any provision
 herein.

 
	
  

 	
  

 
	
 9.12

 	
 Validity. If any provision of this Agreement shall be
 illegal or invalid for any reason, said illegality or invalidity shall not
 affect the remaining parts hereof, but this Agreement shall be construed and
 enforced as if such illegal or invalid provision had never been included herein.

 
	
  

 	
  

 
	
 9.13

 	
 Notice. Any notice or filing required or permitted to
 be given to the Company or Plan Administrator under this Agreement shall be sufficient
 if in writing and hand-delivered or sent by registered or certified mail to
 the address below:

 






	
  

 	
  

 	
  

 
	
  

 	
 Floridian
 Financial Group, Inc.

 	
  

 
	
  

 	
 1696 North Clyde
 Morris Blvd.

 	
  

 
	
  

 	
 Daytona
 Beach, FL. 32174

 	
  

 






	
  

 	
  

 
	
  

 	
 Such
 notice shall be deemed given as of the date of delivery or, if delivery is
 made by mail, as of the date shown on the postmark on the receipt for
 registration or certification.

 


14









	
  

 
	
 Floridian Bank

 Salary Continuation Agreement

 
	

 


 






	
  

 	
  

 
	
  

 	
 Any
 notice or filing required or permitted to be given to the Executive under
 this Agreement shall be
 sufficient if in writing and hand-delivered or sent by mail to the last known address of the Executive.

 
	
  

 	
  

 
	
 9.14

 	
 Compliance
 with Section 409A. This Agreement shall be interpreted and administered
 consistent with Code Section 409A.

 



           IN
WITNESS WHEREOF, the Executive and a duly authorized representative of the Company have signed this Agreement.


	
  

 	
  

 	
  

 	
  

 	
  

 
	
 EXECUTIVE

 	
  

 	
 COMPANY

 
	
  

 	
  

 	
  

 
	
 /s/  THOMAS DARGAN

 	
  

 	
 By:      /s/  JOHN D. WATERS

 
	

 


 	
  

 	
  

 	

 


 
	
 THOMAS DARGAN

 	
  

 	
 Title:      CFO

 
	
  

 	
  

 	
  

 	

 


 


15