EXHIBIT 10.6


                             FIRST STATE CORPORATION
                            1997 STOCK INCENTIVE PLAN
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                                TABLE OF CONTENTS

                                                                          Page

      SECTION 1  DEFINITIONS...............................................  1

            1.1   Definitions..............................................  1

      SECTION 2  THE STOCK INCENTIVE PLAN..................................  5

            2.1   Purpose of the Plan......................................  5
            2.2   Stock Subject to the Plan................................  5
            2.3   Administration of the Plan...............................  5
            2.4   Eligibility and Limits...................................  6

      SECTION 3  TERMS OF STOCK INCENTIVES.................................  6

            3.1   Terms and Conditions of All Stock Incentives.............  6
            3.2   Terms and Conditions of Options..........................  7
                  (a)   Option Price.......................................  8
                  (b)   Option Term........................................  8
                  (c)   Payment............................................  8
                  (d)   Conditions to the Exercise of an Option............  8
                  (e)   Termination of Incentive Stock Option..............  9
                  (f)   Special Provisions for Certain Substitute Options..  9

            3.3   Terms and Conditions of Stock Appreciation Rights........  9
                  (a)   Settlement.......................................... 9
                  (b)   Conditions to Exercise.............................. 9
            3.4   Terms and Conditions of Stock Awards..................... 10
            3.5   Terms and Conditions of Dividend Equivalent Rights....... 10
                  (a)   Payment............................................ 10
                  (b)   Conditions to Payment.............................. 10
            3.6   Terms and Conditions of Performance Unit Awards.......... 10
                  (a)   Payment............................................ 10
                  (b)   Conditions to Payment.............................. 11
            3.7   Terms and Conditions of Phantom Shares................... 11
                  (a)   Payment............................................ 11
                  (b)   Conditions to Payment.............................. 11
            3.8   Treatment of Awards Upon Termination of Service.......... 11

      SECTION 4  RESTRICTIONS ON STOCK..................................... 11
            4.1   Escrow of Shares......................................... 11
            4.2   Forfeiture of Shares..................................... 12
            4.3   Restrictions on Transfer................................. 12


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      SECTION 5  GENERAL PROVISIONS........................................ 12
            5.1   Withholding.............................................. 12
            5.2   Changes in Capitalization; Merger; Liquidation........... 13
            5.3   Cash Awards.............................................. 13
            5.4   Compliance with Code..................................... 14
            5.5   Right to Terminate Service............................... 14
            5.6   Restrictions on Delivery and Sale of Shares; Legends..... 14
            5.7   Non-alienation of Benefits............................... 14
            5.8   Termination and Amendment of the Plan.................... 14
            5.9   Stockholder Approval..................................... 14
            5.10  Choice of Law............................................ 15
            5.11  Effective Date of Plan................................... 15


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                             FIRST STATE CORPORATION
                            1997 STOCK INCENTIVE PLAN

                              SECTION 1 DEFINITIONS

     1.1 Definitions. Whenever used herein, the masculine pronoun shall be
deemed to include the feminine, and the singular to include the plural, unless
the context clearly indicates otherwise, and the following capitalized words and
phrases are used herein with the meaning thereafter ascribed:

          (a) "Board of Directors" means the board of directors of the Company.

          (b) "Cause" has the same meaning as provided in the employment
agreement between the Participant and the Company or, if applicable, any
affiliate of the Company on the date of Termination of Service, or if no such
definition or employment agreement exists, "Cause" means conduct amounting to
(1) fraud or dishonesty against the Company or its affiliates, (2) Participant's
willful misconduct, repeated refusal to follow the reasonable directions of the
board of directors of the Company or its affiliates, or knowing violation of law
in the course of performance of the duties of Participant's service with the
Company or its affiliates, (3) repeated absences from work without a reasonable
excuse, (4) repeated intoxication with alcohol or drugs while on the Company or
affiliates' premises during regular business hours, (5) a conviction or plea of
guilty or nolo contendere to a felony or a crime involving dishonesty, or (6) a
breach or violation of the terms of any agreement to which Participant and the
Company or its affiliates are party.

          (c) "Change in Control" means any one of the following events which
may occur without the approval of the Board of Directors:

               (1) the acquisition by any person, entity or "group," within the
meaning of Section 13(d)(3) or Section 14(d)(2) of the Securities Exchange Act
of 1934 (excluding, for this purpose, any employee benefit plan maintained by
the Company or any affiliate), which acquires beneficial ownership of voting
securities of the Company (or of such other Company affiliates as may be
identified in the Stock Incentive Agreement or otherwise designated by the
Committee) of beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the Securities Exchange Act of 1934) of more than fifty percent (50%) of
either the then outstanding shares of Stock or the combined voting power of the
Company's (or of such other Company affiliates') (as may be identified in the
Stock Incentive Agreement or otherwise designated by the Committee) then
outstanding voting securities entitled to vote generally in the election of
directors;

               (2) the acquisition by any person, entity or "group," within the
meaning of Section 13(d)(3) or Section 14(d)(2) of the Securities Exchange Act
of 1934 (excluding, for this purpose, any employee benefit plan maintained by
the Company or any affiliate), which acquires beneficial ownership of voting
securities of the Company (or of such other Company affiliates as may be
identified in the Stock Incentive Agreement or otherwise designated by the
Committee) of beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the Securities Exchange Act of 1934) of more than thirty percent (30%) or
more of either the then outstanding shares of Stock or the combined voting power
of the Company's (or of such other Company affiliates') (as
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may be identified in the Stock Incentive Agreement or otherwise designated by
the Committee) then outstanding voting securities entitled to vote generally in
the election of directors and the failure for any reason of individuals who
constitute the Incumbent Board to continue to constitute at least two-thirds of
the Board of Directors within any thirteen (13) month period. For purposes of
this Section 1.1(c)(2), the term "Incumbent Board" shall mean the members of the
Board of Directors as of the date this Plan is adopted by the Board of Directors
and any person becoming a member of the Board of Directors after that date whose
election, or whose nomination for election by the Company's stockholders was
approved by a vote of at least two-thirds of the directors then comprising the
Incumbent Board (other than an election or nomination of an individual whose
initial assumption of office is in connection with an actual or threatened
election contest relating to the election of directors of the Company, as such
terms are used in Rule 14a-11 of Regulation 14A promulgated under the Securities
Exchange Act of 1934); or

               (3) the approval by the stockholders of the Company (or of such
other Company affiliates as may be identified in the Stock Incentive Agreement
or otherwise designated by the Committee) of a reorganization, merger or
consolidation, with respect to which persons who were the stockholders of the
Company (or of such other Company affiliates as may be identified in the Stock
Incentive Agreement or otherwise designated by the Committee) immediately prior
to such reorganization, merger or consolidation do not, immediately thereafter,
own more than fifty percent (50%) of the combined voting power entitled to vote
generally in the election of directors of the reorganized, merged or
consolidated company's then outstanding voting securities, or a liquidation or
dissolution of the Company (or of such other Company affiliates as may be
identified in the Stock Incentive Agreement or otherwise designated by the
Committee) or the sale of all or substantially all of the assets of the Company
(or of such other Company affiliates as may be identified in the Stock Incentive
Agreement or otherwise designated by the Committee).

          (d) "Code" means the Internal Revenue Code of 1986, as amended.

          (e) "Committee" means the committee appointed by the Board of
Directors to administer the Plan pursuant to Plan Section 2.3.

          (f) "Company" means First State Corporation, a Georgia corporation.

          (g) "Disability" has the same meaning as provided in the long-term
disability plan or policy maintained or, if applicable, most recently
maintained, by the Company or, if applicable, any affiliate of the Company for
the Participant. If no long-term disability plan or policy was ever maintained
on behalf of the Participant or, if the determination of Disability relates to
an Incentive Stock Option, Disability shall mean that condition described in
Code Section 22(e)(3), as amended from time to time. In the event of a dispute,
the determination of Disability shall be made by the Board of Directors and
shall be supported by advice of a physician competent in the area to which such
Disability relates.

          (h) "Disposition" means any conveyance, sale, transfer, assignment,
pledge or hypothecation, whether outright or as security, inter vivos or
testamentary, with or without consideration, voluntary or involuntary.

         
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          (i) "Dividend Equivalent Rights" means certain rights to receive cash
payments as described in Plan Section 3.5.

          (j) "Fair Market Value" refers to the determination of value of a
share of Stock. If the Stock is actively traded on any national securities
exchange or any Nasdaq quotation or market system, Fair Market Value shall mean
the closing price at which sales of Stock shall have been sold on the most
recent trading date immediately prior to the date of determination, as reported
by any such exchange or system selected by the Committee on which the shares of
Stock are then traded. If the shares of Stock are not actively traded on any
such exchange or system, Fair Market Value shall mean the arithmetic mean of the
bid and asked prices for the shares of Stock on the most recent trading date
within a reasonable period prior to the determination date as reported by such
exchange or system. If there are no bid and asked prices within a reasonable
period or if the shares of Stock are not traded on any exchange or system as of
the determination date, Fair Market Value shall mean the fair market value of a
share of Stock as determined by the Committee taking into account such facts and
circumstances deemed to be material by the Committee to the value of the Stock
in the hands of the Participant; provided that, for purposes of granting awards
other than Incentive Stock Options, Fair Market Value of a share of Stock may be
determined by the Committee by reference to the average market value determined
over a period certain or as of specified dates, to a tender offer price for the
shares of Stock (if settlement of an award is triggered by such an event) or to
any other reasonable measure of fair market value and provided further that, for
purposes of granting Incentive Stock Options, Fair Market Value of a share of
Stock shall be determined in accordance with the valuation principles described
in the regulations promulgated under Code Section 422.

          (k) "Incentive Stock Option" means an incentive stock option, as
defined in Code Section 422, described in Plan Section 3.2.

          (l) "Non-Qualified Stock Option" means a stock option, other than an
option qualifying as an Incentive Stock Option, described in Plan Section 3.2.

          (m) "Option" means a Non-Qualified Stock Option or an Incentive Stock
Option.

          (n) "Over 10% Owner" means an individual who at the time an Incentive
Stock Option is granted owns Stock possessing more than 10% of the total
combined voting power of the Company or one of its Parents or Subsidiaries,
determined by applying the attribution rules of Code Section 424(d).

          (o) "Parent" means any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company if, with respect to
Incentive Stock Options, at the time of granting of the Option, each of the
corporations other than the Company owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in the chain.

          (p) "Participant" means an individual who receives a Stock Incentive
hereunder.


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          (q) "Performance Unit Award" refers to a performance unit award
described in Plan Section 3.6.

          (r) "Phantom Shares" refers to the rights described in Plan Section
3.7.

          (s) "Plan" means the First State Corporation 1997 Stock Incentive
Plan.

          (t) "Stock" means the Company's common stock, $1.00 par value.

          (u) "Stock Appreciation Right" means a stock appreciation right
described in Plan Section 3.3.

          (v) "Stock Award" means a stock award described in Plan Section 3.4.

          (w) "Stock Incentive Agreement" means an agreement between the Company
and a Participant or other documentation evidencing an award of a Stock
Incentive.

          (x) "Stock Incentive Program" means a written program established by
the Committee pursuant to which Stock Incentives, other than Options or Stock
Appreciation Rights, are awarded under the Plan under uniform terms, conditions
and restrictions set forth in such written program and distributed among
eligible officers, employees and directors.

          (y) "Stock Incentives" means, collectively, Dividend Equivalent
Rights, Incentive Stock Options, Non-Qualified Stock Options, Performance Unit
Awards, Phantom Shares, Stock Appreciation Rights and Stock Awards.

          (z) "Subsidiary" means any corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company if, with respect to
Incentive Stock Options, at the time of the granting of the Option, each of the
corporations other than the last corporation in the unbroken chain owns stock
possessing 50% or more of the total combined voting power of all classes of
stock in one of the other corporations in the chain.

          (aa) "Termination of Service" means the termination of the service
relationship, whether employment or otherwise, between a Participant and the
Company and its affiliates, regardless of the fact that severance or similar
payments are made to the Participant for any reason, including, but not by way
of limitation, a termination by resignation, discharge, death, Disability or
retirement. The Committee shall, in its absolute discretion, determine the
effect of all matters and questions relating to Termination of Service,
including, but not by way of limitation, the question of whether a leave of
absence constitutes a Termination of Service, or whether a Termination of
Service is for Cause.


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                       SECTION 2 THE STOCK INCENTIVE PLAN

     2.1 Purpose of the Plan. The Plan is intended to (a) provide incentive to
officers, employees, directors and consultants of the Company and its affiliates
to stimulate their efforts toward the continued success of the Company and to
operate and manage the business in a manner that will provide for the long-term
growth and profitability of the Company; (b) encourage stock ownership by
officers, employees, directors and consultants by providing them with a means to
acquire a proprietary interest in the Company by acquiring shares of Stock or to
receive compensation which is based upon appreciation in the value of Stock; and
(c) provide a means of obtaining and rewarding key personnel.

     2.2 Stock Subject to the Plan. Subject to adjustment in accordance with
Section 5.2, 230,000 shares of Stock (the "Maximum Plan Shares") are hereby
reserved exclusively for issuance pursuant to Stock Incentives. At no time shall
the Company have outstanding Stock Incentives and shares of Stock issued in
respect of Stock Incentives in excess of the Maximum Plan Shares. The shares of
Stock attributable to the nonvested, unpaid, unexercised, unconverted or
otherwise unsettled portion of any Stock Incentive that is forfeited or
cancelled or expires or terminates for any reason without becoming vested, paid,
exercised, converted or otherwise settled in full shall again be available for
purposes of the Plan.

     2.3 Administration of the Plan. The Plan shall be administered by the
Committee. The Committee shall have full authority in its discretion to
determine the officers, employees, directors and consultants of the Company or
its affiliates to whom Stock Incentives shall be granted and the terms and
provisions of Stock Incentives, subject to the Plan. Subject to the provisions
of the Plan, the Committee shall have full and conclusive authority to interpret
the Plan; to prescribe, amend and rescind rules and regulations relating to the
Plan; to determine the terms and provisions of the respective Stock Incentive
Agreements or Stock Incentive Programs and to make all other determinations
necessary or advisable for the proper administration of the Plan. The
Committee's determinations under the Plan need not be uniform and may be made by
it selectively among persons who receive, or are eligible to receive, awards
under the Plan (whether or not such persons are similarly situated). The
Committee's decisions shall be final and binding on all Participants.

     As to any matter involving a Participant who is not a "reporting person"
for purposes of Section 16 of the Securities Exchange Act of 1934, the Committee
may delegate to any member of the Board of Directors or officer of the Company
the administrative authority to (a) interpret the provisions of the
Participant's Stock Incentive Agreement and (b) determine the treatment of Stock
Incentives upon a Termination of Service, as contemplated by Plan Section 3.8.

     The Committee shall consist of at least two members of the Board of
Directors. The Board of Directors shall consider the advisability of complying
with the disinterested standards contained in both Code Section 162(m) and Rule
16b-3(b)(3) (promulgated under the Securities Exchange Act of 1934) when
appointing members to, or otherwise considering the composition of, the
Committee. The Board of Directors may from time to time remove members from or
add members to the Committee. Vacancies on the Committee shall be filled by the
Board of Directors.


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     2.4 Eligibility and Limits. Stock Incentives may be granted only to
officers, employees, directors and consultants of the Company or an affiliate;
provided, however, that an Incentive Stock Option may only be granted to an
employee of the Company or any Parent or Subsidiary. In the case of Incentive
Stock Options, the aggregate Fair Market Value (determined as at the date an
Incentiv ired under Code Section 162(m) and regulations thereunder for
compensation to be treated as qualified performance-based compensation, the
maximum number of shares Stock with respect to which Options or Stock
Appreciation Rights may be granted during any single fiscal year of the Company
to any Participant who is a "covered employee," within the meaning of Code
Section 162(m) and the regulations promulgated thereunder (a "Covered
Employee"), shall not exceed 100,000.

                       SECTION 3 TERMS OF STOCK INCENTIVES

     3.1 Terms and Conditions of All Stock Incentives.

          (a) The number of shares of Stock as to which a Stock Incentive shall
be granted shall be determined by the Committee in its sole discretion, subject
to the provisions of Section 2.2 as to the total number of shares available for
grants under the Plan. If a Stock Incentive Agreement so provides, a Participant
may be granted a new Option to purchase a number of shares of Stock equal to the
number of previously owned shares of Stock tendered in payment of the Exercise
Price (as defined below) for each share of Stock purchased pursuant to the terms
of the Stock Incentive Agreement.

          (b) Each Stock Incentive shall be evidenced either by a Stock
Incentive Agreement in such form and containing such terms, conditions and
restrictions as the Committee may determine is appropriate or be made subject to
the terms of a Stock Incentive Program, containing such terms, conditions and
restrictions as the Committee may determine is appropriate. Each Stock Incentive
Agreement or Stock Incentive Program shall be subject to the terms of the Plan
and any provision in a Stock Incentive Agreement or Stock Incentive Program that
is inconsistent with the Plan shall be null and void.

          (c) The date a Stock Incentive is granted shall be the date on which
the Committee has approved the terms and conditions of the Stock Incentive
Agreement or Stock Incentive Program and has determined the recipient of the
Stock Incentive and the number of shares covered by the Stock Incentive and has
taken all such other action necessary to complete the grant of the Stock
Incentive.

          (d) The Committee may provide in any Stock Incentive Agreement or
pursuant to any Stock Incentive Program (or subsequent to the award of a Stock
Incentive but prior to its expiration or cancellation, as the case may be) that,
in the event of a Change in Control, the Stock


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Incentive shall or may be cashed out on the basis of any price not greater than
the highest price paid for a share of Stock in any transaction reported by any
market or system selected by the Committee on which the shares of Stock are then
actively traded during a specified period immediately preceding or including the
date of the Change in Control or offered for a share of Stock in any tender
offer occurring during a specified period immediately preceding or including the
date the tender offer commences; provided that, in no case shall any such
specified period exceed one (1) year (the "Change in Control Price"). For
purposes of this Subsection, the cash-out of a Stock Incentive shall be
determined as follows:

               (1) Options shall be cashed out on the basis of the excess, if
any, of the Change in Control Price (but not more than the Fair Market Value of
the Stock on the date of the cash-out in the case of Incentive Stock Options)
over the Exercise Price with or without regard to whether the Option may
otherwise be exercisable only in part;

               (2) Stock Awards and Phantom Shares shall be cashed out in an
amount equal to the Change in Control Price with or without regard to any
conditions or restrictions otherwise applicable to any such Stock Incentive; and

               (3) Stock Appreciation Rights, Dividend Equivalent Rights and
Performance Unit Awards shall be cashed out with or without regard to any
conditions or restrictions otherwise applicable to any such Stock Incentive and
the amount of the cash out shall be determined by reference to the number of
shares of Stock that would be required to pay the Participant in kind for the
value of the Stock Incentive as of the date of the Change in Control multiplied
by the Change in Control Price.

          (e) Any Stock Incentive may be granted in connection with all or any
portion of a previously or contemporaneously granted Stock Incentive. Exercise
or vesting of a Stock Incentive granted in connection with another Stock
Incentive may result in a pro rata surrender or cancellation of any related
Stock Incentive, as specified in the applicable Stock Incentive Agreement or
Stock Incentive Program.

          (f) Stock Incentives shall not be transferable or assignable except by
will or by the laws of descent and distribution and shall be exercisable, during
the Participant's lifetime, only by the Participant; in the event of the
Disability of the Participant, by the legal representative of the Participant;
or in the event of the death of the participant, by the personal representative
of the Participant's estate or if no personal representative has been appointed,
by the successor in interest determined under the Participant's will.

     3.2 Terms and Conditions of Options. Each Option granted under the Plan
shall be evidenced by a Stock Incentive Agreement. At the time any Option is
granted, the Committee shall determine whether the Option is to be an Incentive
Stock Option or a Non-Qualified Stock Option, and the Option shall be clearly
identified as to its status as an Incentive Stock Option or a Non-Qualified
Stock Option. At the time any Incentive Stock Option is exercised, the Company
shall be entitled to place a legend on the certificates representing the shares
of Stock purchased pursuant to the Option to clearly identify them as shares of
Stock purchased upon exercise of an Incentive


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Stock Option. An Incentive Stock Option may only be granted within ten (10)
years from the earlier of the date the Plan is adopted by the Board of Directors
or approved by the Company's stockholders.

          (a) Option Price. Subject to adjustment in accordance with Section 5.2
and the other provisions of this Section 3.2, the exercise price (the "Exercise
Price") per share of Stock purchasable under any Option shall be as set forth in
the applicable Stock Incentive Agreement. With respect to each grant of an
Incentive Stock Option to a Participant who is not an Over 10% Owner or to each
grant of any Option to a Participant who is then a Covered Employee, the
Exercise Price per share shall not be less than the Fair Market Value on the
date the Option is granted. With respect to each grant of an Incentive Stock
Option to a Participant who is an Over 10% Owner, the Exercise Price shall not
be less than 110% of the Fair Market Value on the date the Option is granted.

          (b) Option Term. The term of an Option shall be as specified in the
applicable Stock Incentive Agreement; provided, however that any Incentive Stock
Option granted to a Participant who is not an Over 10% Owner shall not be
exercisable after the expiration of ten (10) years after the date the Option is
granted and any Incentive Stock Option granted to an Over 10% Owner shall not be
exercisable after the expiration of five (5) years after the date the Option is
granted.

          (c) Payment. Payment for all shares of Stock purchased pursuant to
exercise of an Option shall be made in any form or manner authorized by the
Committee in the Stock Incentive Agreement or by amendment thereto, including,
but not limited to, cash or, if the Stock Incentive Agreement provides, (1) by
delivery to the Company of a number of shares of Stock which have been owned by
the holder for at least six (6) months prior to the date of exercise having an
aggregate Fair Market Value of not less than the product of the Exercise Price
multiplied by the number of shares the Participant intends to purchase upon
exercise of the Option on the date of delivery; (2) in a cashless exercise
through a broker; or (3) by having a number of shares of Stock withheld, the
Fair Market Value of which as of the date of exercise is sufficient to satisfy
the Exercise Price. In its discretion, the Committee also may authorize (at the
time an Option is granted or thereafter) Company financing to assist the
Participant as to payment of the Exercise Price on such terms as may be offered
by the Committee in its discretion. Payment shall be made at the time that the
Option or any part thereof is exercised, and no shares shall be issued or
delivered upon exercise of an option until full payment has been made by the
Participant. The holder of an Option, as such, shall have none of the rights of
a stockholder.

          (d) Conditions to the Exercise of an Option. Each Option granted under
the Plan shall be exercisable by whom, at such time or times, or upon the
occurrence of such event or events, and in such amounts, as the Committee shall
specify in the Stock Incentive Agreement; provided, however, that subsequent to
the grant of an Option, the Committee, at any time before complete termination
of such Option, may accelerate the time or times at which such Option may be
exercised in whole or in part, including, without limitation, upon a Change in
Control and may permit the Participant or any other designated person to
exercise the Option, or any portion thereof, for all or


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part of the remaining Option term notwithstanding any provision of the Stock
Incentive Agreement to the contrary.

          (e) Termination of Incentive Stock Option. With respect to an
Incentive Stock Option, in the event of the Termination of Service of a
Participant, the Option or portion thereof held by the Participant which is
unexercised shall expire, terminate, and become unexercisable no later than the
expiration of three (3) months after the date of Termination of Service;
provided, however, that in the case of a holder whose Termination of Service is
due to death or Disability, one (1) year shall be substituted for such three (3)
month period. For purposes of this Subsection (e), Termination of Service of the
Participant shall not be deemed to have occurred if the Participant is employed
by another corporation (or a parent or subsidiary corporation of such other
corporation) which has assumed the Incentive Stock Option of the Participant in
a transaction to which Code Section 424(a) is applicable.

          (f) Special Provisions for Certain Substitute Options. Notwithstanding
anything to the contrary in this Section 3.2, any Option issued in substitution
for an option previously issued by another entity, which substitution occurs in
connection with a transaction to which Code Section 424(a) is applicable, may
provide for an exercise price computed in accordance with such Code Section and
the regulations thereunder and may contain such other terms and conditions as
the Committee may prescribe to cause such substitute Option to contain as nearly
as possible the same terms and conditions (including the applicable vesting and
termination provisions) as those contained in the previously issued option being
replaced thereby.

     3.3 Terms and Conditions of Stock Appreciation Rights. Each Stock
Appreciation Right granted under the Plan shall be evidenced by a Stock
Incentive Agreement. A Stock Appreciation Right may be granted in connection
with all or any portion of a previously or contemporaneously granted Stock
Incentive or not in connection with a Stock Incentive. A Stock Appreciation
Right shall entitle the Participant to receive the excess of (a) the Fair Market
Value of a specified or determinable number of shares of the Stock at the time
of payment or exercise over (b) a specified price (1) which, in the case of a
Stock Appreciation Right granted in connection with an Option, shall be not less
than the Exercise Price for that number of shares and (2) which, in the case of
a Stock Appreciation Right that is granted to a Participant who is then a
Covered Employee, shall not be less than the Fair Market Value of the Stock at
the time of the award. A Stock Appreciation Right granted in connection with a
Stock Incentive may only be exercised to the extent that the related Stock
Incentive has not been exercised, paid or otherwise settled. The exercise of a
Stock Appreciation Right granted in connection with a Stock Incentive shall
result in a pro rata surrender or cancellation of any related Stock Incentive to
the extent the Stock Appreciation Right has been exercised.

          (a) Settlement. Upon settlement of a Stock Appreciation Right, the
Company shall pay to the Participant the appreciation in cash or shares of Stock
(valued at the aggregate Fair Market Value on the date of payment or exercise)
as provided in the Stock Incentive Agreement or, in the absence of such
provision, as the Committee may determine.

          (b) Conditions to Exercise. Each Stock Appreciation Right granted
under the Plan shall be exercisable or payable at such time or times, or upon
the occurrence of such event or events, and in such amounts, as the Committee
shall specify in the Stock Incentive Agreement; provided,


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however, that subsequent to the grant of a Stock Appreciation Right, the
Committee, at any time before complete termination of such Stock Appreciation
Right, may accelerate the time or times at which such Stock Appreciation Right
may be exercised or paid in whole or in part.

     3.4 Terms and Conditions of Stock Awards. The number of shares of Stock
subject to a Stock Award and restrictions or conditions on such shares, if any,
shall be as the Committee determines, and the certificate for such shares shall
bear evidence of any restrictions or conditions. Subsequent to the date of the
grant of the Stock Award, the Committee shall have the power to permit, in its
discretion, an acceleration of the expiration of an applicable restriction
period with respect to any part or all of the shares awarded to a Participant.
The Committee may require a cash payment from the Participant in an amount no
greater than the aggregate Fair Market Value of the shares of Stock awarded
determined at the date of grant in exchange for the grant of a Stock Award or
may grant a Stock Award without the requirement of a cash payment.

     3.5 Terms and Conditions of Dividend Equivalent Rights. A Dividend
Equivalent Right shall entitle the Participant to receive payments from the
Company in an amount determined by reference to any cash dividends paid on a
specified number of shares of Stock to Company stockholders of record during the
period such rights are effective. The Committee may impose such restrictions and
conditions on any Dividend Equivalent Right as the Committee in its discretion
shall determine, including the date any such right shall terminate and may
reserve the right to terminate, amend or suspend any such right at any time.

          (a) Payment. Payment in respect of a Dividend Equivalent Right may be
made by the Company in cash or shares of Stock (valued at Fair Market Value on
the date of payment) as provided in the Stock Incentive Agreement or, in the
absence of such provision, as the Committee may determine.

          (b) Conditions to Payment. Each Dividend Equivalent Right granted
under the Plan shall be payable at such time or times, or upon the occurrence of
such event or events, and in such amounts, as the Committee shall specify in the
Stock Incentive Agreement or Stock Incentive Program; provided, however, that
subsequent to the grant of a Dividend Equivalent Right, the Committee, at any
time before complete termination of such Dividend Equivalent Right, may
accelerate the time or times at which such Dividend Equivalent Right may be paid
in whole or in part.

     3.6 Terms and Conditions of Performance Unit Awards. A Performance Unit
Award shall entitle the Participant to receive, at a future date, payment of an
amount equal to all or a portion of the value of a number of units (stated in
terms of a designated dollar amount per unit) granted by the Committee, all as
the Committee shall specify in the Stock Incentive Agreement or Stock Incentive
Program. At the time of the grant, the Committee must determine the base value
of each unit, the number of units subject to a Performance Unit Award, the
performance factors applicable to the determination of the ultimate payment
value of the Performance Unit Award and the period over which Company
performance shall be measured. The Committee may provide for an alternate base
value for each unit under certain specified conditions.

          (a) Payment. Payment in respect of Performance Unit Awards may be made
by the Company in cash or shares of Stock (valued at Fair Market Value on the
date of payment) as


                                      -10-
<PAGE>

provided in the Stock Incentive Agreement or Stock Incentive Program or, in the
absence of such provision, as the Committee may determine.

          (b) Conditions to Payment. Each Performance Unit Award granted under
the Plan shall be payable at such time or times, or upon the occurrence of such
event or events, and in such amounts, as the Committee shall specify in the
Stock Incentive Agreement or Stock Incentive Program; provided, however, that
subsequent to the grant of a Performance Unit Award, the Committee, at any time
before complete termination of such Performance Unit Award, may accelerate the
time or times at which such Performance Unit Award may be paid in whole or in
part.

     3.7 Terms and Conditions of Phantom Shares. Phantom Shares shall entitle
the Participant to receive, at a future date, payment of an amount equal to all
or a portion of the Fair Market Value of a number of shares of Stock at the end
of a certain period, all as the Committee shall specify in the Stock Incentive
Agreement or Stock Incentive Program. At the time of the grant, the Committee
shall determine the factors which will govern the portion of the rights so
payable, including, at the discretion of the Committee, any performance criteria
that must be satisfied as a condition to payment.

          (a) Payment. Payment in respect of Phantom Shares may be made by the
Company in cash or shares of Stock (valued at Fair Market Value on the date of
payment) as provided in the Stock Incentive Agreement or Stock Incentive Program
or, in the absence of such provision, as the Committee may determine.

          (b) Conditions to Payment. Each Phantom Share granted under the Plan
shall be payable at such time or times, or upon the occurrence of such event or
events, and in such amounts, as the Committee shall specify in the Stock
Incentive Agreement or Stock Incentive Program; provided, however, that
subsequent to the grant of a Phantom Share, the Committee, at any time before
complete termination of such Phantom Share, may accelerate the time or times at
which such Phantom Share may be paid in whole or in part.

     3.8 Treatment of Awards Upon Termination of Service. Except as otherwise
provided by Plan Section 3.2(e), any award under this Plan to a Participant who
suffers a Termination of Service may be cancelled, accelerated, paid or
continued, as provided in the Stock Incentive Agreement or Stock Incentive
Program or, in the absence of such provision, as the Committee may determine.
The portion of any award exercisable in the event of continuation or the amount
of any payment due under a continued award may be adjusted by the Committee to
reflect the Participant's period of service from the date of grant through the
date of the Participant's Termination of Service or such other factors as the
Committee determines are relevant to its decision to continue the award.

                         SECTION 4 RESTRICTIONS ON STOCK

     4.1 Escrow of Shares. Any certificates representing the shares of Stock
issued under the Plan shall be issued in the Participant's name, but, if the
Stock Incentive Agreement or Stock Incentive Program so provides, the shares of
Stock shall be held by a custodian designated by the Committee (the
"Custodian"). Each applicable Stock Incentive Agreement or Stock Incentive
Program providing for transfer of shares of Stock to the Custodian shall appoint
the Custodian as the attorney-in-fact for the Participant for the term specified
in the applicable Stock Incentive


                                      -11-
<PAGE>

Agreement or Stock Incentive Program, with full power and authority in the
Participant's name, place and stead to transfer, assign and convey to the
Company any shares of Stock held by the Custodian for such Participant, if the
Participant forfeits the shares under the terms of the applicable Stock
Incentive Agreement or Stock Incentive Program. During the period that the
Custodian holds the shares subject to this Section, the Participant shall be
entitled to all rights, except as provided in the applicable Stock Incentive
Agreement or Stock Incentive Program, applicable to shares of Stock not so held.
Any dividends declared on shares of Stock held by the Custodian shall, as the
Committee may provide in the applicable Stock Incentive Agreement or Stock
Incentive Program, be paid directly to the Participant or, in the alternative,
be retained by the Custodian until the expiration of the term specified in the
applicable Stock Incentive Agreement or Stock Incentive Program and shall then
be delivered, together with any proceeds, with the shares of Stock to the
Participant or to the Company, as applicable.

     4.2 Forfeiture of Shares. Notwithstanding any vesting schedule set forth in
any Stock Incentive Agreement or Stock Incentive Program, in the event that the
Participant violates a noncompetition agreement as set forth in the Stock
Incentive Agreement or Stock Incentive Program, all Stock Incentives and shares
of Stock issued to the holder pursuant to the Plan shall be forfeited; provided,
however, that the Company shall return to the holder the lesser of any
consideration paid by the Participant in exchange for Stock issued to the
Participant pursuant to the Plan or the then Fair Market Value of the Stock
forfeited hereunder.

     4.3 Restrictions on Transfer. The Participant shall not have the right to
make or permit to exist any Disposition of the shares of Stock issued pursuant
to the Plan except as provided in the Plan or the applicable Stock Incentive
Agreement or Stock Incentive Program. Any Disposition of the shares of Stock
issued under the Plan by the Participant not made in accordance with the Plan or
the applicable Stock Incentive Agreement or Stock Incentive Program shall be
void. The Company shall not recognize, or have the duty to recognize, any
Disposition not made in accordance with the Plan and the applicable Stock
Incentive Agreement or Stock Incentive Program, and the shares so transferred
shall continue to be bound by the Plan and the applicable Stock Incentive
Agreement or Stock Incentive Program.

                          SECTION 5 GENERAL PROVISIONS

     5.1 Withholding. The Company shall deduct from all cash distributions under
the Plan any taxes required to be withheld by federal, state or local
government. Whenever the Company proposes or is required to issue or transfer
shares of Stock under the Plan or upon the vesting of any Stock Award, the
Company shall have the right to require the recipient to remit to the Company an
amount sufficient to satisfy any federal, state and local withholding tax
requirements prior to the delivery of any certificate or certificates for such
shares or the vesting of such Stock Award. A Participant may pay the withholding
tax in cash, or, if the applicable Stock Incentive Agreement or Stock Incentive
Program provides, a Participant may elect to have the number of shares of Stock
he is to receive reduced by, or with respect to a Stock Award, tender back to
the Company, the smallest number of whole shares of Stock which, when multiplied
by the Fair Market Value of the shares of Stock determined as of the Tax Date
(defined below), is sufficient to satisfy federal, state and local, if any,
withholding taxes arising from exercise or payment of a Stock Incentive (a
"Withholding Election"). A Participant may make a Withholding Election only if
both of the following conditions are met:


                                      -12-
<PAGE>

          (a) The Withholding Election must be made on or prior to the date on
which the amount of tax required to be withheld is determined (the "Tax Date")
by executing and delivering to the Company a properly completed notice of
Withholding Election as prescribed by the Committee; and

          (b) Any Withholding Election made will be irrevocable; however, the
Committee may in its sole discretion disapprove and give no effect to the
Withholding Election.

     5.2 Changes in Capitalization; Merger; Liquidation.

          (a) The number of shares of Stock reserved for the grant of Options,
Dividend Equivalent Rights, Performance Unit Awards, Phantom Shares, Stock
Appreciation Rights and Stock Awards; the number of shares of Stock reserved for
issuance upon the exercise or payment, as applicable, of each outstanding
Option, Dividend Equivalent Right, Performance Unit Award, Phantom Share and
Stock Appreciation Right and upon vesting or grant, as applicable, of each Stock
Award; the Exercise Price of each outstanding Option and the specified number of
shares of Stock to which each outstanding Dividend Equivalent Right, Phantom
Share and Stock Appreciation Right pertains shall be proportionately adjusted
for any increase or decrease in the number of issued shares of Stock resulting
from a subdivision or combination of shares or the payment of an ordinary stock
dividend in shares of Stock to holders of outstanding shares of Stock or any
other increase or decrease in the number of shares of Stock outstanding effected
without receipt of consideration by the Company.

          (b) In the event of any merger, consolidation, extraordinary dividend
(including a spin-off), reorganization or other change in the corporate
structure of the Company or its Stock or tender offer for shares of Stock, the
Committee, in its sole discretion, may make such adjustments with respect to
awards and take such other action as it deems necessary or appropriate to
reflect or in anticipation of such merger, consolidation, extraordinary
dividend, reorganization, other change in corporate structure or tender offer,
including, without limitation, the substitution of new awards, the termination
or adjustment of outstanding awards, the acceleration of awards or the removal
of restrictions on outstanding awards. Any adjustment pursuant to this Section
5.2 may provide, in the Committee's discretion, for the elimination without
payment therefor of any fractional shares that might otherwise become subject to
any Stock Incentive.

          (c) The existence of the Plan and the Stock Incentives granted
pursuant to the Plan shall not affect in any way the right or power of the
Company to make or authorize any adjustment, reclassification, reorganization or
other change in its capital or business structure, any merger or consolidation
of the Company, any issue of debt or equity securities having preferences or
priorities as to the Stock or the rights thereof, the dissolution or liquidation
of the Company, any sale or transfer of all or any part of its business or
assets, or any other corporate act or proceeding.

     5.3 Cash Awards. The Committee may, at any time and in its discretion,
grant to any holder of a Stock Incentive the right to receive, at such times and
in such amounts as determined by the Committee in its discretion, a cash amount
which is intended to reimburse such person for all or a portion of the federal,
state and local income taxes imposed upon such person as a consequence of the
receipt of the Stock Incentive or the exercise of rights thereunder.


                                      -13-
<PAGE>

     5.4 Compliance with Code. All Incentive Stock Options to be granted
hereunder are intended to comply with Code Section 422, and all provisions of
the Plan and all Incentive Stock Options granted hereunder shall be construed in
such manner as to effectuate that intent.

     5.5 Right to Terminate Service. Nothing in the Plan or in any Stock
Incentive Agreement or Stock Incentive Program shall confer upon any Participant
the right to continue as an employee, officer, director or consultant of the
Company or any of its affiliates or affect the right of the Company or any of
its affiliates to terminate the Participant's service at any time.

     5.6 Restrictions on Delivery and Sale of Shares; Legends. Each Stock
Incentive is subject to the condition that if at any time the Committee, in its
discretion, shall determine that the listing, registration or qualification of
the shares covered by such Stock Incentive upon any securities exchange or under
any state or federal law is necessary or desirable as a condition of or in
connection with the granting of such Stock Incentive or the purchase or delivery
of shares thereunder, the delivery of any or all shares pursuant to such Stock
Incentive may be withheld unless and until such listing, registration or
qualification shall have been effected. If a registration statement is not in
effect under the Securities Act of 1933 or any applicable state securities laws
with respect to the shares of Stock purchasable or otherwise deliverable under
Stock Incentives then outstanding, the Committee may require, as a condition of
exercise of any Option or as a condition to any other delivery of Stock pursuant
to a Stock Incentive, that the Participant or other recipient of a Stock
Incentive represent, in writing, that the shares received pursuant to the Stock
Incentive are being acquired for investment and not with a view to distribution
and agree that the shares will not be disposed of except pursuant to an
effective registration statement, unless the Company shall have received an
opinion of counsel that such disposition is exempt from such requirement under
the Securities Act of 1933 and any applicable state securities laws. The Company
may include on certificates representing shares delivered pursuant to a Stock
Incentive such legends referring to the foregoing representations or
restrictions or any other applicable restrictions on resale as the Company, in
its discretion, shall deem appropriate.

     5.7 Non-alienation of Benefits. Other than as specifically provided with
regard to the death of a Participant, no benefit under the Plan shall be subject
in any manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance or charge; and any attempt to do so shall be void. No such benefit
shall, prior to receipt by the Participant, be in any manner liable for or
subject to the debts, contracts, liabilities, engagements or torts of the
Participant.

     5.8 Termination and Amendment of the Plan. The Board of Directors at any
time may amend or terminate the Plan without stockholder approval; provided,
however, that the Board of Directors may condition any amendment on the approval
of stockholders of the Company if such approval is necessary or advisable with
respect to tax, securities or other applicable laws. No such termination or
amendment without the consent of the holder of a Stock Incentive shall adversely
affect the rights of the Participant under such Stock Incentive.

     5.9 Stockholder Approval. The Plan shall be submitted to the stockholders
of the Company for their approval within twelve (12) months before or after its
adoption by the Board of Directors. If such approval is not obtained, any Stock
Incentive granted under the Plan shall be void.


                                      -14-
<PAGE>

     5.10 Choice of Law. The laws of the State of Georgia shall govern the Plan,
to the extent not preempted by federal law.

     5.11 Effective Date of Plan. The Plan shall become effective upon the date
the Plan is approved by the Board of Directors.

     IN WITNESS WHEREOF, the Company has caused this Plan to be executed this
27th day of January , 1997.


                                  FIRST STATE CORPORATION


                                  By: /s/ Douglas E. Wren
                                      -------------------
                                  Title: President
                                         ----------------

Attest:


/s/ Robert E. Lee
-----------------
Secretary

      [CORPORATE SEAL]


                                      -15-
<PAGE>

                  INCENTIVE STOCK OPTION AWARD PURSUANT TO THE
                FIRST STATE CORPORATION 1997 STOCK INCENTIVE PLAN

     THIS AWARD is made as of the Grant Date by FIRST STATE CORPORATION (the
"Company") to ________________________________________ (the "Optionee").

     Upon and subject to the Terms and Conditions attached hereto and
incorporated herein by reference, the Company hereby awards as of the Grant Date
to Optionee an incentive stock option (the "Option"), as described below, to
purchase the Option Shares.

     A.   Grant Date: _________________, 1997.

     B.   Type of Option: Incentive stock option issued under the First State
          Corporation 1997 Stock Incentive Plan.

     C.   Option Shares: All or any part of ___________________ shares of the
          Company's common stock, $1.00 par value per share ("Common Stock"),
          subject to adjustment as provided in the attached Terms and
          Conditions.

     D.   Exercise Price: $____ per share of Common Stock (no less than 100%
          (110% in the case of an Over 10% Owner) of fair market value as of the
          Grant Date), subject to adjustment as provided in the attached Terms
          and Conditions.

     E.   Option Period: The Option may be exercised as to all or any portion of
          the Option Shares, but only during the Option Period, which commences
          sixth (6) months following the Grant Date and ends, generally, on the
          earliest of (a) the tenth (10th) (or fifth (5th) in the case of an
          Over 10% Owner) anniversary of the Grant Date; (b) thirty (30) days
          following the date of the Optionee's Termination of Employment for any
          reason other than due to death or Disability; or (c) one (1) year
          following the date of the Optionee's Termination of Employment due to
          death or Disability; provided that the Option may be exercised as to
          no more than the vested Option Shares, determined pursuant to the
          Vesting Schedule attached as Schedule 1. Note that other limitations
          to exercising the Option, as described in the attached Terms and
          Conditions, may apply.

     F.   Vesting Schedule: The Option Shares shall become vested in accordance
          with the attached Vesting Schedule. All or a portion of the Option
          Shares may become vested on an earlier date as provided in the
          attached Terms and Conditions.

     IN WITNESS WHEREOF, the Company has executed and sealed this Award as of
the Grant Date set forth above.

                             FIRST STATE CORPORATION


                             By:________________________________________________

                             Title: ____________________________________________


                                                                Page 1 of 5
<PAGE>

                           TERMS AND CONDITIONS TO THE
                          INCENTIVE STOCK OPTION AWARD
                       PURSUANT TO FIRST STATE CORPORATION
                            1997 STOCK INCENTIVE PLAN

     1. Exercise of Option. Subject to the provisions provided herein or in the
Award made pursuant to the Plan:

          (a) the Option may be exercised with respect to all or any portion of
     the vested Option Shares at any time during the Option Period by the
     delivery to the Company, at its principal place of business, of a written
     notice of exercise in substantially the form attached hereto as Exhibit 1,
     which shall be actually delivered to the Company no earlier than thirty
     (30) days and no later than ten (10) days prior to the date upon which
     Optionee desires to exercise all or any portion of the Option; and

          (b) payment to the Company of the Exercise Price multiplied by the
     number of Option Shares being purchased (the "Purchase Price") as provided
     in Section 2.

          (c) Notwithstanding anything to the contrary in the Terms and
     Conditions or the Award, the Option shall not become exercisable until
     after the date of stockholder approval of the Plan and if such stockholder
     approval is not obtained within twelve months following the adoption of the
     Plan by the Board of Directors, the Option shall be rendered null and void.

Upon acceptance of such notice and receipt of payment in full of the Purchase
Price, the Company shall cause to be issued a certificate representing the
Option Shares purchased.

     2. Purchase Price. Payment of the Purchase Price for all Option Shares
purchased pursuant to the exercise of an Option shall be made in cash or
certified check or, alternatively, as follows:

          (a) by delivery to the Company of a number of shares of Common Stock
     which have been owned by the Optionee for at least six (6) months prior to
     the date of the Option's exercise having a fair market value, as determined
     under the Plan, on the date of exercise either equal to the Purchase Price
     or in combination with cash or a certified check to equal the Purchase
     Price; or

          (b) by receipt of the Purchase Price in cash from a broker, dealer or
     other "creditor" as defined by Regulation T issued by the Board of
     Governors of the Federal Reserve System following delivery by the Optionee
     to the Committee of instructions in a form acceptable to the Committee
     regarding delivery to such broker, dealer or other creditor of that number
     of Option Shares with respect to which the Option is exercised.

     3. Vested Option Shares. The Option Shares shall become vested in the
manner provided in the Vesting Schedule attached hereto; provided, however, that
all Option Shares shall become vested no later than the date of a Change in
Control, or any earlier date specified by the


                                                                Page 2 of 5
<PAGE>

Committee in writing to the Optionee subsequent to or contemporaneously with a
determination by the Committee that a Change in Control is imminent.

     4. Rights as Shareholder. Until the stock certificates reflecting the
Option Shares accruing to the Optionee upon exercise of the Option are issued to
the Optionee, the Optionee shall have no rights as a shareholder with respect to
such Option Shares. The Company shall make no adjustment for any dividends or
distributions or other rights on or with respect to Option Shares for which the
record date is prior to the issuance of that stock certificate, except as the
Plan or the attached Award otherwise provides.

     5. Restriction on Transfer of Option and of Option Shares. The Option
evidenced hereby is nontransferable other than by will or the laws of descent
and distribution and shall be exercisable during the lifetime of the Optionee
only by the Optionee (or in the event of his disability, by his personal
representative) and after his death, only by his legatee or the executor of his
estate.

     6. Changes in Capitalization.

          (a) If the number of shares of Common Stock shall be increased or
     decreased by reason of a subdivision or combination of shares of Common
     Stock, the payment of a stock dividend in shares of Common Stock or any
     other increase or decrease in the number of shares of Common Stock
     outstanding effected without receipt of consideration by the Company, an
     appropriate adjustment shall be made by the Committee, in a manner
     determined in its sole discretion, in the number and kind of Option Shares
     and in the Exercise Price.

          (b) Subject to any other action which the Committee is authorized to
     take pursuant to Section 5.2(b) of the Plan, in the event of any merger,
     consolidation, extraordinary dividend (including a spin-off),
     reorganization, other change in corporate structure or tender offer,
     including a Change in Control, pursuant to which the Company is not the
     surviving entity and the surviving entity does not agree to the assumption
     of the Option, the Committee may elect to terminate the Option Period as of
     the date of the event in consideration of the payment to the Optionee of
     the sum of the difference between the then Fair Market Value of the Common
     Stock and the Exercise Price for each Option Share as to which the Option
     has not been exercised as of the date of the event.

          (c) The existence of the Plan and the Option granted pursuant to this
     Agreement shall not affect in any way the right or power of the Company to
     make or authorize any adjustment, reclassification, reorganization or other
     change in its capital or business structure, any merger or consolidation of
     the Company, any issue of debt or equity securities having preferences or
     priorities as to the Common Stock or the rights thereof, the dissolution or
     liquidation of the Company, any sale or transfer of all or any part of its
     business or assets, or any other corporate act or proceeding. Any
     adjustment pursuant to this Section may provide, in the Committee's
     discretion, for the elimination without payment therefor of any fractional
     shares that might otherwise become subject to any Option.

     7. Special Limitation on Exercise. No purported exercise of the Option
shall be effective without the approval of the Committee, which may be withheld
to the extent that the exercise, either


                                                                Page 3 of 5
<PAGE>

individually or in the aggregate together with the exercise of other previously
exercised stock options and/or offers and sales pursuant to any prior or
contemplated offering of securities, would, in the sole and absolute judgment of
the Committee, require the filing of a registration statement with the United
States Securities and Exchange Commission or with the securities commission of
any state. If a registration statement is not in effect under the Securities Act
of 1933 or any applicable state securities law with respect to shares of Common
Stock purchasable or otherwise deliverable under the Option, the Optionee (a)
shall deliver to the Company, prior to the exercise of the Option or as a
condition to the delivery of Common Stock pursuant to the exercise of an Option
exercise, such information, representations and warranties as the Company may
reasonably request in order for the Company to be able to satisfy itself that
the Option Shares are being acquired in accordance with the terms of an
applicable exemption from the securities registration requirements of applicable
federal and state securities laws and (b) shall agree that the shares of Common
Stock so acquired will not be disposed of except pursuant to an effective
registration statement, unless the Company shall have received an opinion of
counsel that such disposition is exempt from such requirement under the
Securities Act of 1933 and any applicable state securities law.

     8. Legend on Stock Certificates. Certificates evidencing the Option Shares,
to the extent appropriate at the time, shall have noted conspicuously on the
certificates a legend intended to give all persons full notice of the existence
of the conditions, restrictions, rights and obligations set forth herein and in
the Plan.

     9. Governing Laws. This Award and the Terms and Conditions shall be
construed, administered and enforced according to the laws of the State of
Georgia.

     10. Successors. This Award and the Terms and Conditions shall be binding
upon and inure to the benefit of the heirs, legal representatives, successors
and permitted assigns of the Optionee and the Company.

     11. Notice. Except as otherwise specified herein, all notices and other
communications under this Award shall be in writing and shall be deemed to have
been given if personally delivered or if sent by registered or certified United
States mail, return receipt requested, postage prepaid, addressed to the
proposed recipient at the last known address of the recipient. Any party may
designate any other address to which notices shall be sent by giving notice of
the address to the other parties in the same manner as provided herein.

     12. Severability. In the event that any one or more of the provisions or
portion thereof contained in the Award and these Terms and Conditions shall for
any reason be held to be invalid, illegal or unenforceable in any respect, the
same shall not invalidate or otherwise affect any other provisions of the Award
and these Terms and Conditions, and the Award and these Terms and Conditions
shall be construed as if the invalid, illegal or unenforceable provision or
portion thereof had never been contained herein.

     13. Entire Agreement. Subject to the terms and conditions of the Plan, the
Award and the Terms and Conditions express the entire understanding of the
parties with respect to the Option.


                                                                Page 4 of 5
<PAGE>

     14. Violation. Any transfer, pledge, sale, assignment, or hypothecation of
the Option or any portion thereof shall be a violation of the terms of the Award
or these Terms and Conditions and shall be void and without effect.

     15. Headings and Capitalized Terms. Section headings used herein are for
convenience of reference only and shall not be considered in construing the
Award or these Terms and Conditions. Capitalized terms used, but not defined, in
either the Award or the Terms and Conditions shall be given the meaning ascribed
to them in the Plan.

     16. Specific Performance. In the event of any actual or threatened default
in, or breach of, any of the terms, conditions and provisions of the Award and
these Terms and Conditions, the party or parties who are thereby aggrieved shall
have the right to specific performance and injunction in addition to any and all
other rights and remedies at law or in equity, and all such rights and remedies
shall be cumulative.

     17. No Right to Continued Retention. Neither the establishment of the Plan
nor the award of Option Shares hereunder shall be construed as giving the
Optionee the right to continued employment with the Company or any affiliate.


                                                                Page 5 of 5
<PAGE>

                                    EXHIBIT 1

                              NOTICE OF EXERCISE OF
                            STOCK OPTION TO PURCHASE
                                 COMMON STOCK OF
                             FIRST STATE CORPORATION

                                       Name ___________________________________
                                       Address ________________________________
                                       ________________________________________
                                       Date ___________________________________



First State Corporation
330 Broad Street
P.O. Box 8
Albany, Georgia  31705

Attention:  President

Re:   Exercise of Incentive Stock Option

Gentlemen:

     Subject to acceptance hereof by First State Corporation (the "Company")
pursuant to the provisions of the First State Corporation 1997 Stock Incentive
Plan (the "Plan"), I hereby give notice of my election to exercise options
granted to me to purchase ______________ shares of common stock of the Company
("Common Stock") under the Incentive Stock Option Award (the "Award") dated as
of _____________________. The purchase shall take place as of
______________________, 199__ (the "Exercise Date").

     On or before the Exercise Date, I will pay the applicable purchase price as
follows:

      [ ]  by delivery of cash or a certified check for $___________ for the
           full purchase price payable to the order of First State Corporation.

      [ ]  by delivery of cash or a certified check for $___________
           representing a portion of the purchase price with the balance to
           consist of shares of Common Stock that I have owned for at least six
           months and that are represented by a stock certificate I will
           surrender to the Company with my endorsement. If the number of
           shares of Common Stock represented by such stock certificate exceed
           the number to be applied against the purchase price, I understand
           that a new stock certificate will be issued to me reflecting the
           excess number of shares.


                             Exhibit 1 - Page 1 of 4
<PAGE>

      [ ]  by delivery of a stock certificate representing shares of Common
           Stock that I have owned for at least six months which I will
           surrender to the Company with my endorsement as payment of the
           purchase price. If the number of shares of Common Stock represented
           by such certificate exceed the number to be applied against the
           purchase price, I understand that a new certificate will be issued
           to me reflecting the excess number of shares.

      [ ]  by delivery of the purchase price by _________________________, a
           broker, dealer or other "creditor" as defined by Regulation T issued
           by the Board of Governors of the Federal Reserve System. I hereby
           authorize the Company to issue a stock certificate for the number of
           shares indicated above in the name of said broker, dealer or other
           creditor or its nominee pursuant to instructions received by the
           Company and to deliver said stock certificate directly to that broker
           dealer or other creditor (or to such other party specified in the
           instructions received by the Company from the broker, dealer or other
           creditor) upon receipt of the purchase price.

     As soon as the stock certificate is registered in my name, please deliver
it to me at the above address.

     If the Common Stock being acquired is not registered for issuance to and
resale by the Optionee pursuant to an effective registration statement on Form
S-8 (or successor form) filed under the Securities Act of 1933, as amended (the
"1933 Act"), I hereby represent, warrant, covenant, and agree with the Company
as follows:

          The shares of the Common Stock being acquired by me will be acquired
     for my own account without the participation of any other person, with the
     intent of holding the Common Stock for investment and without the intent of
     participating, directly or indirectly, in a distribution of the Common
     Stock and not with a view to, or for resale in connection with, any
     distribution of the Common Stock, nor am I aware of the existence of any
     distribution of the Common Stock;

          I am not acquiring the Common Stock based upon any representation,
     oral or written, by any person with respect to the future value of, or
     income from, the Common Stock but rather upon an independent examination
     and judgment as to the prospects of the Company;

          The Common Stock was not offered to me by means of publicly
     disseminated advertisements or sales literature, nor am I aware of any
     offers made to other persons by such means;

          I am able to bear the economic risks of the investment in the Common
     Stock, including the risk of a complete loss of my investment therein;

          I understand and agree that the Common Stock will be issued and sold
     to me without registration under any state law relating to the registration
     of securities for sale, and will be issued and sold in reliance on the
     exemptions from registration under the 1933 Act, provided by Sections 3(b)
     and/or 4(2) thereof and the rules and regulations promulgated thereunder;


                             Exhibit 1 - Page 2 of 4
<PAGE>

          The Common Stock cannot be offered for sale, sold or transferred by me
     other than pursuant to: (A) an effective registration under the 1933 Act or
     in a transaction otherwise in compliance with the 1933 Act; and (B)
     evidence satisfactory to the Company of compliance with the applicable
     securities laws of other jurisdictions. The Company shall be entitled to
     rely upon an opinion of counsel satisfactory to it with respect to
     compliance with the above laws;

          The Company will be under no obligation to register the Common Stock
     or to comply with any exemption available for sale of the Common Stock
     without registration or filing, and the information or conditions necessary
     to permit routine sales of securities of the Company under Rule 144 under
     the 1933 Act are not now available and no assurance has been given that it
     or they will become available. The Company is under no obligation to act in
     any manner so as to make Rule 144 available with respect to the Common
     Stock;

          I have and have had complete access to and the opportunity to review
     and make copies of all material documents related to the business of the
     Company, including, but not limited to, contracts, financial statements,
     tax returns, leases, deeds and other books and records. I have examined
     such of these documents as I wished and am familiar with the business and
     affairs of the Company. I realize that the purchase of the Common Stock is
     a speculative investment and that any possible profit therefrom is
     uncertain;

          I have had the opportunity to ask questions of and receive answers
     from the Company and any person acting on its behalf and to obtain all
     material information reasonably available with respect to the Company and
     its affairs. I have received all information and data with respect to the
     Company which I have requested and which I have deemed relevant in
     connection with the evaluation of the merits and risks of my investment in
     the Company;

          I have such knowledge and experience in financial and business matters
     that I am capable of evaluating the merits and risks of the purchase of the
     Common Stock hereunder and I am able to bear the economic risk of such
     purchase; and

          The agreements, representations, warranties and covenants made by me
     herein extend to and apply to all of the Common Stock of the Company issued
     to me pursuant to this Award. Acceptance by me of the certificate
     representing such Common Stock shall constitute a confirmation by me that
     all such agreements, representations, warranties and covenants made herein
     shall be true and correct at that time.

     I understand that the certificates representing the shares being purchased
by me in accordance with this notice shall bear a legend referring to the
foregoing covenants, representations and warranties and restrictions on
transfer, and I agree that a legend to that effect may be placed on any
certificate which may be issued to me as a substitute for the certificates being
acquired by me in


                             Exhibit 1 - Page 3 of 4
<PAGE>

accordance with this notice. I further understand that capitalized terms used in
this Notice of Exercise without definition shall have the meanings given to them
in the Plan.


                                                 Very truly yours,

                                                 _______________________________
AGREED TO AND ACCEPTED:

FIRST STATE CORPORATION


By: ____________________________________

Title: _________________________________

Number of Shares
Exercised: _____________________________

Number of Shares Remaining: ____________                   Date: ____________


                             Exhibit 1 - Page 4 of 4
<PAGE>

                                                            [Name of Optionee]

                                   SCHEDULE 1
                           TO FIRST STATE CORPORATION
                          INCENTIVE STOCK OPTION AWARD

                                Vesting Schedule

     "Vested Shares" means only that percentage of the Option Shares as to which
the Option becomes exercisable following completion of the years of service
indicated in the schedule first set forth below.


            Percentage of Option Shares         Years of Service
              Which are Vested Shares           after Grant Date
            ---------------------------         ----------------

                       0%                         Less than 1
                      20%                               1
                      40%                               2
                      60%                               3
                      80%                               4
                      100%                         5 or more


----------
     1. Construction. (a) For purposes of the Vesting Schedule, Optionee shall
be granted a year of service for each consecutive twelve-consecutive-month
period following the Grant Date and during which Optionee continues, at all
times, as an employee of the Company or a Subsidiary.

     (b) The right of Optionee to vest in Common Stock shall cease upon the
termination of his or her service as an employee with the Company and any
Subsidiaries. Thereafter, no further shares shall become Vested Shares. The
Option shall be exercisable only as to Vested Shares during the Option Period
specified in the Award.


                            Schedule 1 - Page 1 of 1