**Exhibit 10.8**

**FIRST RELIANCE BANCSHARES, INC.  2006 EQUITY INCENTIVE PLAN**

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**FIRST RELIANCE BANCSHARES, INC. 2006 EQUITY INCENTIVE PLAN**

**TABLE OF CONTENTS**

| SECTION 1  DEFINITIONS                  | 1                                                             |
|----------------------------------------------|---------------------------------------------------------------|
|                                         |                                                          |   |
| **1.1**                                      | **DEFINITIONS**                                               | **1** |
|                                         |                                                          |
| SECTION 2  THE EQUITY   INCENTIVE PLAN  | 3                                                             |
|                                         |                                                          |   |
| **2.1**                                      | **PURPOSE OF THE PLAN**                                       | **3** |
| **2.2**                                      | **STOCK SUBJECT TO THE PLAN**                                 | **4** |
| **2.3**                                      | **ADMINISTRATION   OF THE PLAN**                              | **4** |
| **2.4**                                      | **ELIGIBILITY AND LIMITS**                                    | **4** |
|                                         |                                                          |
| SECTION 3  TERMS OF STOCK   INCENTEIVES | 4                                                             |
|                                         |                                                          |   |
| **3.1**                                      | **TERMS AND CONDITIONS OF ALL STOCK   INCENTIVES**            | **4** |
| **3.2**                                      | **TERMS AND CONDITIONS OF OPTIONS**                           | **5** |
| **3.3**                                      | **TERMS AND CONDITIONS OF STOCK   APPRECIATION RIGHTS**       | **6** |
| **3.4**                                      | **TERMS AND CONDITIONS OF STOCK   AWARDS**                    | **7** |
| **3.5**                                      | **TERMS AND CONDITIONS OF DIVIDEND EQUIVALENT   RIGHTS**      | **7** |
| **3.6**                                      | **TERMS AND CONDITIONS OF PERFORMANCE UNIT   AWARDS**         | **8** |
| **3.7**                                      | **TERMS AND CONDITIONS OF PHANTOM SHARES**                    | **8** |
| **3.8**                                      | **TREATMENT OF AWARDS   UPON TERMINATION OF EMPLOYMENT**      | **8** |
| **3.9**                                      | **SECTION 409A CONSIDERATIONS**                               | **9** |
|                                         |                                                          |
| SECTION 4  RESTRICTIONS ON   STOCK      | 9                                                             |
|                                         |                                                          |   |
| **4.1**                                      | **ESCROW OF SHARES**                                          | **9** |
| **4.2**                                      | **RESTRICTIONS ON   TRANSFER**                                | **9** |
|                                         |                                                          |
| SECTION 5  GENERAL PROVISIONS           | 9                                                             |
|                                         |                                                          |   |
| **5.1**                                      | **WITHHOLDING**                                               | **9** |
| **5.2**                                      | **CHANGES IN CAPITALIZATION; MERGER; LIQUIDATION**            | **10** |
| **5.3**                                      | **CASH AWARDS**                                               | **11** |
| **5.4**                                      | **RIGHT TO TERMINATE   EMPLOYMENT OR SERVICE   RELATIONSHIP** | **11** |
| **5.5**                                      | **NON-ALIENATION   OF BENEFITS**                              | **11** |
| **5.6**                                      | **RESTRICTIONS ON   DELIVERY AND SALE OF   SHARES; LEGENDS**  | **11** |
| **5.7**                                      | **LISTING AND LEGAL   COMPLIANCE**                            | **12** |
| **5.8**                                      | **TERMINATION AND AMENDMENT OF THE PLAN**                     | **12** |
| **5.9**                                      | **CHOICE OF LAW**                                             | **12** |
| **5.10**                                     | **EFFECTIVE DATE**                                            | **12** |

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**FIRST RELIANCE BANCSHARES, INC. 2006 EQUITY INCENTIVE PLAN**

**SECTION 1 Definitions**

1.1          **Definitions.** Whenever used herein, the masculine pronoun will 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)          “**Affiliate**” means:

                          (1)          any corporation (other than the Company) in an unbroken chain of corpora-tions ending with the Company if, at the time of the granting of the Option, each of the corporations other than the Company own stock possessing 50% or more of the total combined voting power of all classes of stock in one of the corporations in such chain; 

                          (2)          any corporation (other than the Company) in an unbroken chain of corporations beginning with the Company if 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;

                          (3)          an entity that directly or through one or more intermediaries controls, is controlled by, or is under common control with the Company, as determined by the Company; or

                          (4)          any entity in which the Company has such a significant interest that the Company determines it should be deemed an “Affiliate”, as determined in the sole discretion of the Company.

          (b)          “**Board of Directors**” means the board of directors of the Company.

          (c)          “**Code**” means the Internal Revenue Code of 1986, as amended.

          (d)          “**Committee**” means the committee appointed by the Board of Directors to administer the Plan or, in lieu of any such appointment, the full membership of the Board of Directors. The Board of Directors shall consider the advisability of whether the members of the Committee shall consist solely of at least two members of the Board of Directors who are “non-employee directors” as defined in Rule 16b-3(b)(3) as promulgated under the Exchange Act and who satisfy the requirements of the national securities exchange or Nasdaq quotation or market system on which the Stock is then traded (the “applicable exchange”). In the event the Committee appointed by the Board of Directors is not comprised solely of members who are “non-employee directors” and who satisfy the requirements of the applicable exchange, theCommittee shall have the authority to establish a subcommittee of the Committee which shall be comprised solely of members of the Committee who are and “non-employee directors” and who satisfy the requirements of the applicable exchange, and to delegate to such subcommittee any or all of the powers of the Committee. References herein to the Committee shall be deemed to mean the subcommittee with respect to those matters within the power of the subcommittee.

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          (e)          “**Company**” means First Reliance Bancshares, Inc., a South Carolina corporation.

          (f)          “**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, Disability means 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 will be made by the Committee and will be supported by advice of a physician competent in the area to which such Disability relates.

          (g)          “**Dividend Equivalent Rights**” means certain rights to receive cash payments as described in Section 3.5.

          (h)          “**Exchange Act**” means the Securities Exchange Act of 1934, as amended from time to time.

          (i)          “**Fair Market Value**” refers to the determination of the value of a share of Stock as of a date, determined as follows:

                          (1)          the price at which Stock shall have been sold on that date or the last trading date prior to that date as reported by the national securities exchange selected by the Committee on which the shares of Stock are then actively traded or, if applicable, as reported by any Nasdaq quotation or market system;

                          (2)          if the Stock is not then actively traded, the price of Stock in the over-the-counter market on that date or the last trading day prior to that date as reported by any Nasdaq quotation or market system or, if not so reported, by a generally accepted reporting service; or

                          (3)          if Stock is not publicly traded as contemplated under Paragraphs (1) or (2) above, the price determined in good faith by the Committee.

**Notwithstanding the foregoing, in applying the requirements of Paragraphs (1), (2), or (3) above, the Committee may use the closing price as of the applicable date or for a period certain ending on such date, the average of the high and low prices as of the applicable date or for a period certain ending on such date, the price determined at the time the transaction is processed, the tender offer price for shares of Stock, or any other method which the Committee determines is reasonably indicative of the fair market value of the Stock.  In determining Fair Market Value in accordance with this Section 1.1(i), the Committee shall consider the advisability of determining Fair Market Value in a manner consistent with Code Section 422 in the case of any grant of Incentive Stock Options and in a manner consistent with Code Section 409A in the case of the grant of Stock Incentives generally. **

          (j)          “**Option**” means an option that is not designated as, or otherwise intended to be, an incentive stock option that is contemplated by Section 422 of the Code.

          (k)          “**Participant**” means an individual who receives a Stock Incentive hereunder.

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          (l)          “**Performance Unit Award**” refers to a performance unit award as described in Section 3.6.

          (m)          “**Phantom Shares**” refers to the rights described in Section 3.7.

          (n)          “**Plan**” means the First Reliance Bancshares, Inc. 2006 Equity Incentive Plan.

          (o)          “**Stock**” means the Company’s common stock, $0.01 par value.

          (p)          “**Stock Appreciation Right**” means a stock appreciation right described in Section 3.3.

          (q)          “**Stock Award**” means a stock award described in Section 3.4.

          (r)          “**Stock Incentive Agreement**” means an agreement between the Company and a Participant or other documentation evidencing an award of a Stock Incentive.

          (s)          “**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.

          (t)          “**Stock Incentives**” means, collectively, Dividend Equivalent Rights, Options, Performance Unit Awards, Phantom Shares, Stock Appreciation Rights and Stock Awards.

          (u)          “**Termination of Employment**” means the termination of the employment relationship between a Participant and the Company and its Affiliates, regardless of whether 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 will, in its absolute discretion, determine the effect of all matters and questions relating to a Termination of Employment as it affects a Stock Incentive, including, but not by way of limitation, the question of whether a leave of absence constitutes a Termination of Employment.

**SECTION 2The Equity Incentive Plan**

          2.1          **Purpose of the Plan**. The Plan is intended to (a) provide incentive to officers, employees, directors, consultants and other service providers 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, consultants and other service providers by providing them with a means to acquire a proprietary interest in the Company, acquire shares of Stock, or to receive compensation which is based upon appreciation in the value of Stock; (c) align the long-term interests of Participants with those of shareholders; (d) heighten the desire of Participants to continue in working toward andcontributing to the success of the Company; (e) assist the Company in competing effectively with other enterprises for the services of new employees necessary for the continued improvement of operations; and (f) to attract and retain qualified individuals for service as directors of the Company. This Plan permits the grant of Dividend Equivalent Rights, Options, Performance Unit Awards, Phantom Shares, Stock Appreciation Rights and Stock Awards, each of which shall be subject to such conditions based upon continued employment, passage of time or satisfaction of performance criteria or other criteria as permitted by the Plan.

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          2.2          **Stock Subject to the Plan**. Subject to adjustment in accordance with Section 5.2, 350,000 shares of Stock (the “Maximum Plan Shares”) are hereby reserved exclusively for issuance pursuant to Stock Incentives. At no time may the Company have outstanding under the Plan Stock Incentives and shares of Stock issued in respect of Stock Incentives under the Plan 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 will again be available for purposes of the Plan.

          2.3          **Administration of the Plan**. The Plan is administered by the Committee. The Committee has full authority in its discretion to determine the officers, employees, directors, consultants and service providers of the Company or its Affiliates to whom Stock Incentives will be granted and the terms and provisions of Stock Incentives, subject to the Plan. Subject to the provisions of the Plan, the Committee has 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 and to make all other determinations necessary or advisable for the proper administration of the Plan. The Committee’s determina-tions under the Plan need not be uniform and may be made by it selectivelyamong persons who receive, or are eligible to receive, awards under the Plan (whether or not such persons are similarly situated). The Committee’s decisions are final and binding on all Participants. Each member of the Committee shall serve at the discretion of the Board of Directors and 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.

          As to any matter involving a Participant who is not a “reporting person” for purposes of Section 16 of the Exchange Act, 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 Employment, as contemplated by Plan Section 3.8.

          2.4          **Eligibility and Limits**. Stock Incentives may be granted only to officers, employees, directors, consultants and other service providers of the Company, or any Affiliate of the Company.  

**SECTION 3Terms of Stock Incentives**

          3.1          **Terms and Conditions of All Stock Incentives**.

                          (a)          The number of shares of Stock, if any, as to which a Stock Incentive may be granted will 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 and subject to the limits on Options and Stock Appreciation Rights and other Stock Incentives in Section 2.4.

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

                         (c)          The date on which a Stock Incentive is granted will be the date on which the Committee has approved the terms and conditions of the Stock Incentive and has determined the recipient of the Stock Incentive and the number of shares, if any, covered by the Stock Incentive, and has taken all such other actions necessary to complete the grant of the Stock Incentive.

                         (d)          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.

                          (e)          Unless otherwise permitted by the Committee, Stock Incentives are not transferable or assignable except by will or by the laws of descent and distribution and are exercisable, during the Participant’s lifetime, only by the Participant; or in the event of the Disability of the Participant, by the legal representative of the Participant; or in the event of death of the Participant, by the legal representative of the Participant’s estate or if no legal 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 must be evidenced by a Stock Incentive Agreement. 

                          (a)          **Option Price**. Subject to adjustment in accordance with Plan 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 must be as set forth in the applicable Stock Incentive Agreement, but in no event may it be less than the Fair Market Value on the date the Option is granted. 

                          (b)          **No Repricing**. Other than in connection with a change in the Company’s capitalization as contemplated by Plan Section 5.2, the exercise price of an Option may not be reduced without approval by the Company’s shareholders.

                          (c)          **Option Term**. The term of any Option shall be as specified in the applicable Stock Incentive Agreement but shall in no event exceed ten (10) years.

                          (d)          **Payment**. Payment for all shares of Stock purchased pursuant to the exercise of an Option will 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;

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                                         (2)          in a cashless exercise through a broker; provided, however, that any such cashless exercise is consistent with the restrictions of Section 13 (k) of the Exchange Act (Section 402 of the Sarbanes-Oxley Act of 2002); 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.

Payment must be made at the time that the Option or any part thereof is exercised, and no shares may 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, has none of the rights of a shareholder.

                          (e)          ******Conditions to the Exercise of an Option**. Each Option granted under the Plan is exercisable by whom, at such time or times, or upon the occurrence of such event or events, and in such amounts, as the Committee specifies 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 part of the remaining Option term, notwithstanding any provision of the Stock Incentive Agreement to the contrary. 

                          (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 may provide for an exercise price 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.

                          (g)          **No Reload Grants**. Options shall not be granted under the Plan in consideration for and shall not be conditioned upon the delivery of shares of Stock to the Company in payment of the exercise price and/or tax withholding obligation under any other option held by a Participant.

          3.3          **Terms and Conditions of Stock Appreciation Rights**. Each Stock Appreciation Right granted under the Plan must be evidenced by a Stock Incentive Agreement. A Stock Appreciation Right entitles the Participant to receive the excess of (1) the Fair Market Value of a specified or determinable number of shares of the Stock at the time of payment or exercise over (2) a specified or determinable price which may not in any event be less than the Fair Market Value of the Stock at the time of the award, and, in the case of a Stock Appreciation Right granted in connection with an Option, may not be less than the Exercise Price for that number of shares subject to that Option. Stock Appreciation Right granted in connection with a Stock Incentive may only be exercised to the extent that the related Stock Incentive has not beenexercised, paid or otherwise settled.

                          (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.

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

                         (c)          **No Repricing**. Other than in connection with a change in the Company’s capitalization as contemplated by Plan Section 5.2, the price of a Stock Appreciation Right as specified in accordance with Clause (2) in the head language of Section 3.3 may not be reduced, without shareholder approval.

          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, will be as the Committee determines and the certificate for such shares will bear evidence of any restrictions or conditions. Subsequent to the date of the grant of the Stock Award, the Committee has 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 cashpayment.

          3.5          **Terms and Conditions of Dividend Equivalent Rights**. A Dividend Equivalent Right entitles the Participant to receive payments from the Company in an amount determined by reference to any dividends paid on a specified number of shares of Stock to Company shareholders 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 Stock Incentive Program, or, in the absence of such provision, as the Committee may determine.

                         (b)          **Conditions**to Payment. Each Dividend Equivalent Right granted under the Plan is payable at such time or times, or upon the occurrence of such event or events, and in such amounts, as the Committee specifies in the applicable 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.

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          3.6          **Terms and Conditions of Performance Unit Awards**. A Performance Unit Award shall entitle the Participant to receive, at a specified future date, payment of an amount equal to all or a portion of the value of a specified or determinable number of units (stated in terms of a designated or determinable dollar amount per unit) granted by the Committee. 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, and 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 provided in the applicable 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 may specify in the applicable 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 specified future date, payment of an amount equal to all or a portion of the Fair Market Value of a specified number of shares of Stock at the end of a specified period. At the time of the grant, the Committee will 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. Phantom Share awards containing performance criteria may be designated as performance share awards.

                         (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 applicable 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 is payable at such time or times, or upon the occurrence of such event or events, and in such amounts, as the Committee may specify in the applicable 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 Employment**. Any award under this Plan to a Participant who has experienced a Termination of Employment or termination of some other service relationship with the Company and its Affiliates may be cancelled, accelerated, paid or continued, as provided in the applicable 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 Employment or other service relationship or such other factors as the Committee determines are relevantto its decision to continue the award.

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          3.9          **Section 409A Considerations**.  In making any award of Stock Incentives or subsequent modifications to any outstanding award for a Stock Incentive, the Committee shall consider the impact of any adverse tax consequences that may affect the Participant under Code Section 409A and any adverse financial accounting consequences that may affect the Company.  To the extent the mere reservation of powers to the Committee to modify a Stock Incentive subsequent to its grant under this Plan might create adverse tax consequences to a Participant under Code Section 409A, the Committee shall be deemed not to have such powers to the extent that the mere possession (as opposed to the exercise) of any such power would result in such adverse tax consequences.

**SECTION 4Restrictions on Stock**

          4.1          **Escrow of Shares**. Any certificates representing the shares of Stock issued under the Plan will be issued in the Participant’s name, but, if the applicable Stock Incentive Agreement or Stock Incentive Program so provides, the shares of Stock will 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 must appoint the Custodian as the attorney-in-fact for the Participant for the term specified in the applicable Stock Incentive 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 theParticipant 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 is 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 must as provided 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. or by the Company 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          **Restrictions on Transfer**. The Participant does 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 will be void. The Company will 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 will continue to be bound by the Plan and the applicable Stock Incentive Agreement or Stock Incentive Program.

**SECTION 5General Provisions**

          5.1          **Withholding**. The Company must 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 has the right to require the recipient to remit to the Company an amount sufficient to satisfy any federal, state and local tax withholding

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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 obligation 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 the minimum required 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:

                         (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 except on six months advance written notice delivered to the Company; 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; and the Exercise Price of each outstanding Option and, to the extent applicable, the value of other Stock Incentives may 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 a stockdividend 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), reorganiza-tion, recapitalization, sale of substantially all of the Company’s assets, other change in the capital structure of the Company, tender offer for shares of Stock, or a change in control of the Company, 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, including without limitation, the assumption of other awards, the substitution of new awards, the adjustment of outstanding awards, the acceleration of awards, the removal of restrictions on outstanding awards, or the termination of outstanding awards in exchange for the cash value determined in goodfaith by the Committee of the vested and/or unvested portion of the award, all as may be provided in the applicable Stock Incentive Agreement or, if not expressly addressed therein, as the Committee subsequently may determine in its sole discretion. 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, but except as set forth in this Section may not otherwise diminish the then value of the Stock Incentive. In making any such adjustment, the Committee shall consider the impact of any adverse tax consequences that may affect the Participant under Code Section 409A and any adverse financial accounting consequences that may affect the Company.

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                         (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.  In considering any such cash award, the Committee shall consider the impact of any adverse tax consequences that may affect the Participant under Code Section 409A and any adverse financial accounting consequences that may affect the Company.

          5.4          **Right to Terminate Employment or Service Relationship**. Nothing in the Plan or in any Stock Incentive Agreement confers upon any Participant the right to continue as an officer, employee, director, consultant or other service provider 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 employment or service relationship at any time.

          5.5          **Non-alienation of Benefits** Other than as specifically provided herein, no benefit under the Plan may 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 may, 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.

          5.6          **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 orotherwise 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.

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          5.7          **Listing and Legal Compliance**. The Committee may suspend the exercise or payment of any Stock Incentive so long as it determines that securities exchange listing or registration or qualification under any securities laws is required in connection therewith and has not been completed on terms acceptable to the Committee.

          5.8          **Termination and Amendment of the Plan**. The Board of Directors at any time may amend or terminate the Plan without shareholder approval; provided, however, that the Board of Directors shall consider the appropriateness of shareholder approval for any amendment to the Plan that increases the number of shares of Stock available under the Plan, materially expands the classes of individuals eligible to receive Stock Incentives, materially expands the type of awards available for issuance under the Plan, or would otherwise require shareholder approval under the rules of the applicable exchange. No such termination or amendment without the consent of the holder of a Stock Incentive may adversely affect the rights of the Participant under such Stock Incentive.

          5.9          **Choice of Law**. The laws of the State of South Carolina govern the Plan, to the extent not preempted by federal law, without reference to the principles of conflict of laws.

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

          IN WITNESS WHEREOF, the Company has executed this Plan on this ____ day of January, 2006.

|   | FIRST   RELIANCE BANCSHARES, INC. |
|--------|-----------------------------------|
|   |                              |   |
|   | By:                               |   |
|   |                              |  |
|   | Title:                            |   |
|   |                              |  |

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