COMMUNITY BANKSHARES, INC.

                              1999 STOCK AWARD PLAN


ARTICLE 1.  ESTABLISHMENT, PURPOSE, AND DURATION

         1.1 ESTABLISHMENT OF THE PLAN.  Community  Bankshares,  Inc., a Georgia
corporation  (hereinafter  referred to as the "Company"),  hereby  establishes a
stock option and incentive award plan known as the "Community  Bankshares,  Inc.
1999 Stock Award Plan" (the  "Plan"),  as set forth in this  document.  The Plan
permits  the grant of  Incentive  Stock  Options,  Nonqualified  Stock  Options,
Restricted Stock, Stock Awards,  Performance Share Awards and Stock Appreciation
Rights.

         The Plan shall become effective on the date it is approved by the Board
of Directors (the "Effective  Date"),  and shall remain in effect as provided in
Section 1.3.  The Board may submit the Plan to the  Company's  shareholders  for
approval in connection with the grant of any Incentive Stock Options.

         1.2  PURPOSE OF THE PLAN.  The purpose of the Plan is to secure for the
Company and its  shareholders  the benefits of the  incentive  inherent in stock
ownership  in the Company by  employees,  directors,  and  consultants  or other
persons who perform services for the Company, who are responsible for its future
growth and  continued  success.  The Plan  promotes the success and enhances the
value of the Company by linking  the  personal  interests  of  Participants  (as
defined  below)  to  those  of the  Company's  shareholders,  and  by  providing
Participants with an incentive for outstanding performance.  The Plan is further
intended  to provide  flexibility  to the  Company in its  ability to  motivate,
attract and retain the services of Participants  upon whose  judgment,  interest
and special effort the successful conduct of its operation largely depends.

         1.3  DURATION OF THE PLAN.  The Plan shall  commence  on the  Effective
Date, and shall remain in effect, subject to the right of the Board of Directors
to amend or terminate the Plan at any time pursuant to Article 14, until the day
prior to the tenth (10th) anniversary of the Effective Date.


ARTICLE 2.  DEFINITIONS

         Whenever used in the Plan, the following  terms shall have the meanings
set forth below:

         (a)      "AGREEMENT"   means  an   agreement   entered   into  by  each
                  Participant  and the  Company,  setting  forth  the  terms and
                  provisions  applicable to Awards granted to Participants under
                  this Plan.

         (b)      "AWARD" means,  individually  or  collectively,  a grant under
                  this  Plan of  Incentive  Stock  Options,  Nonqualified  Stock
                  Options,  Restricted  Stock,  Stock Awards,  Performance Share
                  Awards or Stock Appreciation Rights.

         (c)      "BENEFICIAL  OWNER" or "BENEFICIAL  OWNERSHIP"  shall have the
                  meaning  ascribed  to such term in Rule 13d-3 of the  Exchange
                  Act.
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         (d)      "BOARD" or "BOARD OF  DIRECTORS"  means the Board of Directors
                  of the Company.

         (e)      "CAUSE"  means:  (i)  willful  misconduct  on  the  part  of a
                  Participant that is materially  detrimental to the Company; or
                  (ii) the  conviction of a Participant  for the commission of a
                  felony.  The  existence  of "Cause"  under  either (i) or (ii)
                  shall be  determined  by the  Committee.  Notwithstanding  the
                  foregoing,  if the  Participant has entered into an employment
                  agreement  that  is  binding  as of  the  date  of  employment
                  termination, and if such employment agreement defines "Cause,"
                  and/or provides a means of determining whether "Cause" exists,
                  such  definition  of  "Cause"  and  means of  determining  its
                  existence shall supersede this provision.

         (f)      "CODE"  means the Internal  Revenue  Code of 1986,  as amended
                  from time to time, or any successor act thereto.

         (g)      "COMMITTEE"  means the  committee or  individual  appointed to
                  administer  the Plan and to grant  Awards  under the Plan,  as
                  specified in Article 3, and to perform the functions set forth
                  therein;  provided  that the  Board  may  designate  the Chief
                  Executive  Officer (or other officer) to make grants of awards
                  with respect to certain persons (other than himself), in which
                  case the  Chief  Executive  Office  will  have the  power  and
                  authority of the Committee hereunder, and the Board may retain
                  the  authority  with respect to the remainder of the Plan in a
                  Committee.

         (h)      "COMMON  STOCK"  means the common  stock of the  Company,  par
                  value $____ per share.

         (i)      "COMPANY"   means  Community   Bankshares,   Inc.,  a  Georgia
                  corporation,  or any successor  thereto as provided in Article
                  18.

         (j)      "CORRESPONDING  SAR" means an SAR that is granted in  relation
                  to a particular Option and that can be exercised only upon the
                  surrender to the Company,  unexercised, of that portion of the
                  Option to which the SAR relates.

         (k)      "DIRECTOR"  means any  individual who is a member of the Board
                  of Directors of the Company.

         (l)      "DISABILITY"  shall have the meaning  ascribed to such term in
                  the   Company's   long-term   disability   plan  covering  the
                  Participant,  or in  the  absence  of  such  plan,  a  meaning
                  consistent with Section 22(e)(3) of the Code.

         (m)      "EMPLOYEE"  means any employee of the Company or the Company's
                  Subsidiaries.  Directors who are not otherwise employed by the
                  Company  or the  Company's  Subsidiaries  are  not  considered
                  Employees under this Plan.

         (n)      "EFFECTIVE  DATE" shall have the meaning ascribed to such term
                  in Section 1.1.

         (o)      "EXCHANGE ACT" means the  Securities  Exchange Act of 1934, as
                  amended from time to time, or any successor act thereto.

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         (p)      "FAIR MARKET VALUE" shall be determined as follows:

                  (i)      If, on the relevant  date, the Shares are traded on a
                           national  or regional  securities  exchange or on The
                           Nasdaq  Stock  Market  ("Nasdaq")  and  closing  sale
                           prices for the Shares are customarily  quoted, on the
                           basis of the  closing  sale  price  on the  principal
                           securities  exchange  on which the Shares may then be
                           traded  or, if there is no such sale on the  relevant
                           date, then on the immediately  preceding day on which
                           a sale was reported;

                  (ii)     If, on the relevant  date,  the Shares are not listed
                           on any securities  exchange or traded on Nasdaq,  but
                           nevertheless  are  publicly  traded and  reported  on
                           Nasdaq  without  closing  sale  prices for the Shares
                           being  customarily  quoted,  on the basis of the mean
                           between the closing bid and asked  quotations in such
                           other over-the-counter  market as reported by Nasdaq;
                           but, if there are no bid and asked  quotations in the
                           over-the-counter market as reported by Nasdaq on that
                           date, then the mean between the closing bid and asked
                           quotations in the over-the-counter market as reported
                           by Nasdaq on the  immediately  preceding day such bid
                           and asked prices were quoted; and

                  (iii)    If, on the relevant date, the Shares are not publicly
                           traded as described  in (i) or (ii),  on the basis of
                           the good faith determination of the Committee.

         (q)      "INCENTIVE  STOCK OPTION" OR "ISO" means an option to purchase
                  Shares  granted  under  Article  6 which is  designated  as an
                  Incentive   Stock   Option  and  is   intended   to  meet  the
                  requirements of Section 422 of the Code.

         (r)      "INITIAL VALUE" means,  with respect to a  Corresponding  SAR,
                  the Option  Price per share of the  related  Option,  and with
                  respect to an SAR granted independently of an Option, the Fair
                  Market  Value  of one  share  of  Common  Stock on the date of
                  grant.

         (s)      "INSIDER" shall mean an Employee who is, on the relevant date,
                  an officer or a director,  or a ten percent  (10%)  beneficial
                  owner of any class of the Company's equity  securities that is
                  registered  pursuant to Section 12 of the  Exchange Act or any
                  successor  provision,  as "officer" and "director" are defined
                  under Section 16 of the Exchange Act.

         (t)      "NAMED  EXECUTIVE  OFFICER" means a Participant who, as of the
                  date of vesting  and/or payout of an Award is one of the group
                  of  "covered   employees,"  as  defined  in  the   regulations
                  promulgated  under  Code  Section  162(m),  or  any  successor
                  statute.

         (u)      "NONQUALIFIED  STOCK  OPTION"  OR  "NQSO"  means an  option to
                  purchase  Shares  granted  under  Article  6, and which is not
                  intended to meet the requirements of Code Section 422.

         (v)      "OPTION"  means an Incentive  Stock  Option or a  Nonqualified
                  Stock Option.

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<PAGE>

         (w)      "OPTION  PRICE"  means  the  price  at  which a  Share  may be
                  purchased  by  a  Participant   pursuant  to  an  Option,   as
                  determined by the Committee.

         (x)      "PARTICIPANT" means an Employee,  a Director,  a consultant or
                  other  person  who  performs  services  for the  Company  or a
                  Subsidiary,  who  has  been  determined  by the  Committee  to
                  contribute  significantly  to the  profits  or  growth  of the
                  Company and who has been granted an Award under the Plan which
                  is outstanding.

         (y)      "PERFORMANCE SHARE AWARD" means an Award, which, in accordance
                  with  and   subject  to  an   Agreement,   will   entitle  the
                  Participant,  or his estate or beneficiary in the event of the
                  Participant's  death,  to  receive  cash,  Common  Stock  or a
                  combination thereof.

         (z)      "PERSON"  shall  have the  meaning  ascribed  to such  term in
                  Section 3(a)(9) of the Exchange Act and used in Sections 13(d)
                  and 14(d)  thereof,  including a "group" as defined in Section
                  13(d) thereof.

         (aa)     "RETIREMENT"  shall mean  retiring  from  employment  with the
                  Company or any Subsidiary on or after attaining age 65.

         (bb)     "RESTRICTED  STOCK" means an Award of Common Stock  granted in
                  accordance   with  the  terms  of  Article  8  and  the  other
                  provisions  of the  Plan,  and  which is  nontransferable  and
                  subject to a substantial risk of forfeiture.  Shares of Common
                  Stock shall cease to be  Restricted  Stock when, in accordance
                  with the  terms  hereof  and the  applicable  Agreement,  they
                  become   transferable   and  free  of   substantial   risk  of
                  forfeiture.

         (cc)     "SAR"  means a stock  appreciation  right  that  entitles  the
                  holder to receive,  with respect to each share of Common Stock
                  encompassed by the exercise of such SAR, the amount determined
                  by the Committee and specified in an Agreement. In the absence
                  of such specification, the holder shall be entitled to receive
                  in  cash,   with   respect  to  each  share  of  Common  Stock
                  encompassed  by the  exercise  of such SAR,  the excess of the
                  Fair  Market  Value on the date of  exercise  over the Initial
                  Value.  References to "SARs" include both  Corresponding  SARs
                  and SARs granted independently of Options,  unless the context
                  requires otherwise.

         (dd)     "SHARES"  means  the  shares of  Common  Stock of the  Company
                  (including   any  new,   additional  or  different   stock  or
                  securities  resulting  from the changes  described  in Section
                  4.3).

         (ee)     "STOCK  AWARD" means a grant of Shares under Article 8 that is
                  not generally  subject to restrictions and pursuant to which a
                  certificate for the Shares is transferred to the Employee.

         (ff)     "SUBSIDIARY"  means any company  during any period in which it
                  is a "subsidiary corporation" (as that term is defined in Code
                  Section 424(f)) with respect to the Company.


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<PAGE>

ARTICLE 3.  ADMINISTRATION

         3.1 THE  COMMITTEE.  The Plan  shall be  administered  by the  Board of
Directors  or  by  a  Committee  of  the  Board,  or  by  any  other  committee,
subcommittee  or person  appointed  by the Board  that is granted  authority  to
administer the Plan.  The members of the Committee  shall be appointed from time
to time by, and shall serve at the discretion of, the Board of Directors.

         3.2 AUTHORITY OF THE COMMITTEE.  Subject to the provisions of the Plan,
the  Committee  shall  have  full  power to  select  the  Employees,  Directors,
consultants  and  other  persons  who  perform  services  for the  Company  or a
Subsidiary, who are responsible for the future growth and success of the Company
who shall participate in the Plan (who may change from year to year);  determine
the size and types of Awards;  determine the terms and conditions of Awards in a
manner consistent with the Plan (including  conditions on the  exercisability of
all or a part of an Option or SAR,  restrictions on transferability  and vesting
provisions on Restricted  Stock or Performance  Share Awards and the duration of
the Awards);  construe and  interpret  the Plan and any  agreement or instrument
entered into under the Plan; establish, amend or waive rules and regulations for
the Plan's  administration;  and (subject to the provisions of Article 14) amend
the terms and conditions of any  outstanding  Award to the extent such terms and
conditions  are within the  discretion of the Committee as provided in the Plan,
including  accelerating  the  time  any  Option  or  SAR  may be  exercised  and
establishing  different  terms  and  conditions  relating  to the  effect of the
termination  of  employment  or other  services  to the  Company.  Further,  the
Committee  shall  make  all  other  determinations  which  may be  necessary  or
advisable in the  Committee's  opinion for the  administration  of the Plan. All
expenses of administering this Plan shall be borne by the Company.

         3.3 DECISIONS  BINDING.  All  determinations  and decisions made by the
Committee  pursuant to the  provisions  of the Plan and all  related  orders and
resolutions of the Board shall be final,  conclusive and binding on all Persons,
including  the Company,  the  shareholders,  Employees,  Participants  and their
estates and beneficiaries.


ARTICLE 4.  SHARES SUBJECT TO THE PLAN

         4.1 NUMBER OF SHARES. Subject to adjustment as provided in Section 4.3,
the total number of Shares available for grant of Awards under the Plan shall be
equal to Ten Percent (10%) of the total issued and outstanding  Shares as of the
date of  adoption  of this  Plan by the  Board.  The  maximum  number  of Shares
available  for grant as ISOs under the Plan shall equal an  aggregate of 150,000
Shares.  The Shares may, in the discretion of the Company,  be either authorized
but  unissued  Shares  or  Shares  held as  treasury  shares,  including  Shares
purchased  by the Company,  whether on the market or  otherwise.  The  following
rules shall  apply for  purposes  of the  determination  of the number of Shares
available for grant under the Plan:

                  (a)      The grant of an Option, SAR, Stock Award,  Restricted
                           Stock Award or  Performance  Share Award shall reduce
                           the Shares  available for grant under the Plan by the
                           number of Shares subject to such Award.

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<PAGE>

                  (b)      While an Option,  SAR, Stock Award,  Restricted Stock
                           Award or Performance  Share Award is outstanding,  it
                           shall  be  counted  against  the  authorized  pool of
                           Shares, regardless of its vested status.

         4.2 LAPSED  AWARDS.  If any Award  granted under this Plan is canceled,
terminates,  expires or lapses for any  reason,  or if Shares  are  withheld  in
payment of the Option Price or for withholding taxes, any Shares subject to such
Award or that are withheld  shall again be  available  for the grant of an Award
under the Plan.  However,  in the event that prior to the Award's  cancellation,
termination,  expiration or lapse,  the holder of the Award at any time received
one or more  "benefits of  ownership"  pursuant to such Award (as defined by the
Securities  and  Exchange  Commission,  pursuant  to any rule or  interpretation
promulgated  under Section 16 of the Exchange  Act),  the Shares subject to such
Award shall not again be made available for regrant under the Plan.

         4.3  ADJUSTMENTS  IN AUTHORIZED  SHARES.  In the event of any change in
corporate  capitalization,  such as a stock split,  or a corporate  transaction,
such as any merger,  consolidation,  separation,  including a spin-off, or other
distribution of stock or property of the Company, any reorganization (whether or
not such reorganization comes within the definition of such term in Code Section
368) or any partial or complete  liquidation  of the  Company,  such  adjustment
shall be made in the number and class of Shares which may be delivered under the
Plan,  and in the  number  and  class of  and/or  price  of  Shares  subject  to
outstanding  Awards  granted  under  the  Plan,  as  may  be  determined  to  be
appropriate and equitable by the Committee,  in its sole discretion,  to prevent
dilution or enlargement of rights; provided,  however, that the number of Shares
subject to any Award shall always be a whole number and the Committee shall make
such adjustments as are necessary to insure Awards of whole Shares.


ARTICLE 5.  ELIGIBILITY AND PARTICIPATION

         Any key Employee of the Company or any  Subsidiary,  including any such
Employee  who is  also  a  director  of  the  Company  or  any  Subsidiary,  any
non-employee  Director, and any consultant or other person who performs services
for  the  Company  or a  Subsidiary,  whose  judgment,  initiative  and  efforts
contribute  or  may be  expected  to  contribute  materially  to the  successful
performance  of the  Company or any  Subsidiary  shall be eligible to receive an
Award under the Plan. In determining the individuals to whom such an Award shall
be granted and the number of Shares which may be granted pursuant to that Award,
the Committee  shall take into account the duties of the respective  individual,
his or her present and potential  contributions to the success of the Company or
any  Subsidiary,  and such other factors as the Committee shall deem relevant in
connection with accomplishing the purpose of the Plan.


ARTICLE 6.  STOCK OPTIONS

         6.1 GRANT OF OPTIONS.  Subject to the terms and provisions of the Plan,
Options  may be  granted  to  Participants  at any time and from time to time as
shall be determined by the  Committee.  The Committee  shall have  discretion in
determining the number of Shares subject to Options granted to each Participant.
An Option may be granted with or without a Corresponding SAR. No Participant may
be granted  ISOs (under the Plan and all other  incentive  stock option plans of
the Company and any Subsidiary) which are first exercisable in any calendar year

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<PAGE>

for Common  Stock having an aggregate  Fair Market Value  (determined  as of the
date an Option is granted) that exceeds  $100,000.  The  preceding  annual limit
shall not apply to NQSOs. The Committee may grant a Participant ISOs, NQSOs or a
combination thereof, and may vary such Awards among Participants;  provided that
only an Employee may be granted ISOs.

         6.2  AGREEMENT.  Each Option  grant shall be  evidenced by an Agreement
that shall specify the Option Price,  the duration of the Option,  the number of
Shares to which the Option  pertains and such other  provisions as the Committee
shall determine. The Option Agreement shall further specify whether the Award is
intended  to be an  ISO  or an  NQSO.  Any  portion  of an  Option  that  is not
designated  as an ISO or otherwise  fails or is not qualified as an ISO (even if
designated  as an ISO) shall be a NQSO.  If the Option is granted in  connection
with a Corresponding  SAR, the Agreement shall also specify the terms that apply
to the exercise of the Option and Corresponding SAR.

         6.3 OPTION  PRICE.  The Option Price for each grant of an ISO shall not
be less than one hundred  percent  (100%) of the Fair Market Value of a Share on
the date the Option is granted. In no event, however,  shall any Participant who
owns  (within  the  meaning of Section  424(d) of the Code) stock of the Company
possessing more than ten percent (10%) of the total combined voting power of all
classes of stock of the Company be eligible to receive an ISO at an Option Price
less than one hundred ten percent  (110%) of the Fair Market Value of a share on
the date the ISO is granted.  The Option Price for each grant of a NQSO shall be
established by the Committee and, in its  discretion,  may be less than the Fair
Market Value of a Share on the date the Option is granted.

         6.4  DURATION OF OPTIONS.  Each Option shall expire at such time as the
Committee  shall  determine  at the time of grant;  provided,  however,  that no
Option shall be exercisable later than the tenth (10th)  anniversary date of its
grant; provided,  further,  however, that any ISO granted to any Participant who
at such time owns  (within the  meaning of Section  424(d) of the Code) stock of
the Company  possessing more than ten percent (10%) of the total combined voting
power of all classes of stock of the  Company,  shall not be  exercisable  later
than the fifth (5th) anniversary date of its grant.

         6.5  EXERCISE  OF  OPTIONS.  Options  granted  under the Plan  shall be
exercisable at such times and be subject to such  restrictions and conditions as
the Committee shall in each instance approve,  including  conditions  related to
the employment of the Participant with the Company or any Subsidiary, which need
not be the same for each grant or for each  Participant.  Each  Option  shall be
exercisable  for such  number  of Shares  and at such  time or times,  including
periodic installments,  as may be determined by the Committee at the time of the
grant.  The Committee  may provide in the  Agreement  for automatic  accelerated
vesting and other rights upon the  occurrence of a Change in Control (as defined
in Section 13.1) of the Company.  Except as otherwise  provided in the Agreement
and Article 13, the right to purchase  Shares that are  exercisable  in periodic
installments  shall be  cumulative so that when the right to purchase any Shares
has  accrued,  such  Shares or any part  thereof  may be  purchased  at any time
thereafter  until the expiration or  termination of the Option.  The exercise or
partial  exercise of either an Option or its  Corresponding  SAR shall result in
the  termination of the other to the extent of the number of Shares with respect
to which the Option or Corresponding SAR is exercised.

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<PAGE>

         6.6  PAYMENT.  Options  shall be exercised by the delivery of a written
notice of  exercise  to the  Company,  setting  forth the number of Shares  with
respect to which the Option is to be exercised,  accompanied by full payment for
the Shares. The Option Price upon exercise of any Option shall be payable to the
Company  in full,  either:  (a) in cash,  (b) cash  equivalent  approved  by the
Committee,  (c) if approved by the Committee,  by tendering  previously acquired
Shares (or  delivering a  certification  of ownership of such Shares)  having an
aggregate  Fair Market  Value at the time of exercise  equal to the total Option
Price  (provided  that the Shares which are tendered  must have been held by the
Participant  for six months,  if required for accounting  purposes,  and for the
period  required  by law,  if any,  prior to their  tender to satisfy the Option
Price),  or (d) by a  combination  of (a), (b) and (c). The  Committee  also may
allow cashless  exercises as permitted under Federal Reserve Board's  Regulation
T, subject to  applicable  securities  law  restrictions,  or by any other means
which the  Committee  determines to be  consistent  with the Plan's  purpose and
applicable law. As soon as practicable  after receipt of a written  notification
of exercise and full payment,  the Company shall deliver to the Participant,  in
the Participant's  name, Share  certificates in an appropriate amount based upon
the number of Shares  purchased under the Option(s),  and may place  appropriate
legends on the certificates representing such Shares.

         6.7 LIMITED  TRANSFERABILITY.  If  permitted  by the  Committee  in the
Agreement,  a Participant may transfer an Option granted  hereunder,  including,
but not  limited to,  transfers  to members of his or her  Immediate  Family (as
defined below),  to one or more trusts for the benefit of such Immediate  Family
members,  or to one or more partnerships where such Immediate Family members are
the only partners,  if (i) the Participant does not receive any consideration in
any form  whatsoever  for such transfer,  (ii) such transfer is permitted  under
applicable tax laws, and (iii) the  Participant is an Insider,  such transfer is
permitted  under Rule 16b-3 of the  Exchange Act as in effect from time to time.
Any Option so  transferred  shall  continue  to be subject to the same terms and
conditions  in the hands of the  transferee  as were  applicable  to said Option
immediately prior to the transfer  thereof.  Any reference in any such Agreement
to  the  employment  by or  performance  of  services  for  the  Company  by the
Participant shall continue to refer to the employment of, or performance by, the
transferring Participant. For purposes hereof, "Immediate Family" shall mean the
Participant and the Participant's spouse, children and grandchildren. Any Option
that is granted pursuant to any Agreement that did not initially expressly allow
the transfer of said Option and that has not been  amended to  expressly  permit
such transfer,  shall not be transferable by the Participant  other than by will
or by the laws of  descent  and  distribution  and  such  Option  thus  shall be
exercisable in the Participant's lifetime only by the Participant.

         6.8  SHAREHOLDER  RIGHTS.  No  Participant  shall  have any rights as a
shareholder  with respect to Shares  subject to his Option until the issuance of
such Shares to the Participant pursuant to the exercise of such Option


ARTICLE 7.  STOCK APPRECIATION RIGHTS

         7.1 GRANTS OF SARS. The Committee shall designate  Participants to whom
SARs are granted,  and will specify the number of Shares of Common Stock subject
to each grant. An SAR may be granted with or without a related Option.  All SARs
granted under this Plan shall be subject to an Agreement in accordance  with the


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<PAGE>

terms  of this  Plan.  A  payment  to the  Participant  upon the  exercise  of a
Corresponding  SAR may not be more than the  difference  between the Fair Market
Value of the Shares  subject to the ISO on the date of grant and the Fair Market
Value of the Shares on the date of exercise of the Corresponding SAR.

         7.2 DURATION OF SARS.  The duration of an SAR shall be set forth in the
Agreement  as  determined  by  the  Committee.  An  SAR  that  is  granted  as a
Corresponding  SAR  shall  have  the same  duration  as the  Option  to which it
relates.  An  SAR  shall  terminate  due  to the  Participant's  termination  of
employment  at the same time as the date  specified in Article 6 with respect to
Options,  regardless of whether the SAR was granted in connection with the grant
of an Option.

         7.3 EXERCISE OF SAR. An SAR may be exercised in whole at any time or in
part  from  time  to  time  and at  such  times  and  in  compliance  with  such
requirements  as the Committee  shall  determine as set forth in the  Agreement;
provided,  however,  that a  Corresponding  SAR that is related to an  Incentive
Stock  Option may be  exercised  only to the extent that the  related  Option is
exercisable and only when the Fair Market Value of the Shares exceeds the Option
Price of the related ISO. An SAR granted  under this Plan may be exercised  with
respect to any number of whole  shares  less than the full  number of shares for
which the SAR could be exercised.  A partial exercise of an SAR shall not affect
the right to exercise the SAR from time to time in accordance with this Plan and
the  applicable  Agreement  with respect to the remaining  shares subject to the
SAR. The exercise of either an Option or  Corresponding  SAR shall result in the
termination  of the other to the extent of the number of Shares with  respect to
which the Option or its Corresponding SAR is exercised.

         7.4  DETERMINATION OF PAYMENT OF CASH AND/OR COMMON STOCK UPON EXERCISE
OF SAR. At the  Committee's  discretion,  the amount  payable as a result of the
exercise of an SAR may be settled in cash,  Common Stock,  or a  combination  of
cash and Common  Stock.  A fractional  share shall not be  deliverable  upon the
exercise of an SAR, but a cash payment shall be made in lieu thereof.

         7.5  NONTRANSFERABILITY.  Each SAR  granted  under  the  Plan  shall be
nontransferable  except  by will or by the  laws of  descent  and  distribution.
During the lifetime of the  Participant to whom the SAR is granted,  the SAR may
be exercised only by the  Participant.  No right or interest of a Participant in
any SAR shall be liable for, or subject to any lien,  obligation or liability of
such Participant.  A Corresponding SAR shall be subject to the same restrictions
on transfer as the ISO to which it relates.  Notwithstanding  the foregoing,  if
the  Agreement  so  provides,  a  Participant  may transfer an SAR (other than a
Corresponding  SAR that relates to an  Incentive  Stock  Option)  under the same
rules and conditions as are set forth in Section 6.7.

         7.6  SHAREHOLDER  RIGHTS.  No  Participant  shall  have any rights as a
shareholder  with  respect  to Shares  subject to an SAR until the  issuance  of
Shares (if any) to the Participant pursuant to the exercise of such SAR.


ARTICLE 8.  RESTRICTED STOCK; STOCK AWARDS

         8.1 GRANTS. The Committee may from time to time in its discretion grant
Restricted  Stock and Stock Awards to Participants  and may determine the number
of Shares of Restricted Stock or Stock Awards to be granted. The Committee shall
determine the terms and conditions of, and the amount of payment,  if any, to be


                                       9
<PAGE>

made by the Employee for such Shares or Restricted  Stock. A grant of Restricted
Stock may, in addition to other  conditions,  require the Participant to pay for
such Shares of Restricted  Stock,  but the Committee may establish a price below
Fair Market Value at which the Participant can purchase the Shares of Restricted
Stock.  Each  grant of  Restricted  Stock  shall be  evidenced  by an  Agreement
containing terms and conditions not inconsistent  with the Plan as the Committee
shall determine to be appropriate in its sole discretion.

         8.2 RESTRICTED  PERIOD;  LAPSE OF RESTRICTIONS.  At the time a grant of
Restricted  Stock is made, the Committee  shall establish a period or periods of
time (the  "Restricted  Period")  applicable  to such  grant  which,  unless the
Committee  otherwise  provides,  shall not be less than one year. Subject to the
other  provisions  of this  Article 8, at the end of the  Restricted  Period all
restrictions shall lapse and the Restricted Stock shall vest in the Participant.
At the time a grant is made,  the Committee  may, in its  discretion,  prescribe
conditions  for the  incremental  lapse of  restrictions  during the  Restricted
Period and for the lapse or termination of  restrictions  upon the occurrence of
other  conditions in addition to or other than the  expiration of the Restricted
Period  with  respect  to all or any  portion  of  the  Restricted  Stock.  Such
conditions may, but need not, include the following:

         (a)      The death,  Disability  or  Retirement of the Employee to whom
                  Restricted Stock is granted, or

         (b)      The  occurrence  of a Change in Control (as defined in Section
                  13.1).

The Committee may also, in its  discretion,  shorten or terminate the Restricted
Period,  or waive any conditions  for the lapse or  termination of  restrictions
with respect to all or any portion of the Restricted Stock at any time after the
date the grant is made.

         8.3 RIGHTS OF HOLDER;  LIMITATIONS THEREON.  Upon a grant of Restricted
Stock, a stock certificate (or  certificates)  representing the number of Shares
of  Restricted  Stock  granted to the  Participant  shall be  registered  in the
Participant's  name  and  shall  be held in  custody  by the  Company  or a bank
selected  by  the  Committee  for  the  Participant's  account.  Following  such
registration,  the  Participant  shall  have  the  rights  and  privileges  of a
shareholder  as to  such  Restricted  Stock,  including  the  right  to  receive
dividends,  if and when  declared  by the Board of  Directors,  and to vote such
Restricted  Stock,  except that the right to receive cash dividends shall be the
right to  receive  such  dividends  either in cash  currently  or by  payment in
Restricted Stock, as the Committee shall determine, and except further that, the
following restrictions shall apply:

         (a)      The  Participant  shall  not  be  entitled  to  delivery  of a
                  certificate   until  the  expiration  or  termination  of  the
                  Restricted   Period  for  the  Shares   represented   by  such
                  certificate  and  the   satisfaction  of  any  and  all  other
                  conditions prescribed by the Committee;

         (b)      None  of  the  Shares  of   Restricted   Stock  may  be  sold,
                  transferred,  assigned,  pledged,  or otherwise  encumbered or
                  disposed  of  during  the  Restricted  Period  and  until  the
                  satisfaction of any and all other conditions prescribed by the
                  Committee; and

                                       10
<PAGE>

         (c)      All of the  Shares of  Restricted  Stock  that have not vested
                  shall be forfeited and all rights of the  Participant  to such
                  Shares of Restricted  Stock shall  terminate  without  further
                  obligation on the part of the Company,  unless the Participant
                  has  remained an employee of (or  non-Employee  Director of or
                  active consultant providing services to) the Company or any of
                  its  Subsidiaries,  until the expiration or termination of the
                  Restricted  Period and the  satisfaction  of any and all other
                  conditions  prescribed  by the  Committee  applicable  to such
                  Shares of Restricted  Stock. Upon the forfeiture of any Shares
                  of  Restricted   Stock,   such   forfeited   Shares  shall  be
                  transferred  to the  Company  without  further  action  by the
                  Participant  and shall,  in accordance with Section 4.2, again
                  be available for grant under the Plan. If the Participant paid
                  any  amount  for the  Shares  of  Restricted  Stock  that  are
                  forfeited, the Company shall pay the Participant the lesser of
                  the Fair  Market  Value  of the  Shares  on the date  they are
                  forfeited or the amount paid by the Participant.

         With respect to any Shares  received as a result of  adjustments  under
Section  4.3 hereof  and any  Shares  received  with  respect to cash  dividends
declared on Restricted  Stock,  the  Participant  shall have the same rights and
privileges,  and be subject to the same  restrictions,  as are set forth in this
Article 8.

         8.4 DELIVERY OF UNRESTRICTED SHARES. Upon the expiration or termination
of the Restricted Period for any Shares of Restricted Stock and the satisfaction
of any and all other  conditions  prescribed by the Committee,  the restrictions
applicable  to  such  Shares  of  Restricted  Stock  shall  lapse  and  a  stock
certificate  for the number of Shares of Restricted  Stock with respect to which
the restrictions  have lapsed shall be delivered,  free of all such restrictions
except any that may be imposed by law,  to the holder of the  Restricted  Stock.
The Company shall not be required to deliver any fractional  Share but will pay,
in  lieu  thereof,  the  Fair  Market  Value  (determined  as of  the  date  the
restrictions lapse) of such fractional Share to the holder thereof. Concurrently
with the delivery of a certificate  for  Restricted  Stock,  the holder shall be
required to pay an amount necessary to satisfy any applicable federal, state and
local tax requirements as set out in Article 16 below.

         8.5 NONASSIGNABILITY OF RESTRICTED STOCK. Unless the Committee provides
otherwise  in the  Agreement,  no  grant  of,  nor any  right or  interest  of a
Participant in or to, any Restricted Stock, or in any instrument  evidencing any
grant of  Restricted  Stock  under  the Plan,  may be  assigned,  encumbered  or
transferred  except, in the event of the death of a Participant,  by will or the
laws of descent and distribution.


ARTICLE 9.  PERFORMANCE SHARE AWARDS

         9.1 AWARD. The Committee may designate Participants to whom Performance
Share Awards will be granted from time to time for no consideration  and specify
the number of shares of Common Stock covered by the Award.

                                       11
<PAGE>

         9.2 EARNING THE AWARD. A Performance  Share Award, or portion  thereof,
will be earned,  and the Participant will be entitled to receive Common Stock, a
cash  payment  or a  combination  thereof,  only  upon  the  achievement  by the
Participant,  the Company, or a Subsidiary of such performance objectives as the
Committee,  in its  discretion,  shall  prescribe  on the  date  of  grant.  The
determination  as to whether such objectives have been achieved shall be made by
the Committee,  and such determination shall be conclusive;  provided,  however,
that the  period in which such  performance  is  measured  shall be at least one
year.

         The Committee may in determining  whether performance targets have been
met  adjust the  Company's  financial  results to exclude  the effect of unusual
charges or income items or other events,  including acquisitions or dispositions
of  businesses  or  assets,   restructurings,   reductions  in  force,  currency
fluctuations or changes in accounting, which are distortive of financial results
(either on a segment or  consolidated  basis).  In addition,  the Committee will
adjust its calculations to exclude the effect on financial results of changes in
the Code or other tax laws, or the regulations relating thereto.

         9.3 PAYMENT.  In the  discretion of the  Committee,  the amount payable
when a Performance Share Award is earned may be settled in cash, by the grant of
Common Stock or a  combination  of cash and Common  Stock.  The  aggregate  Fair
Market  Value of the Common  Stock  received  by the  Participant  pursuant to a
Performance Share Award,  together with any cash paid to the Participant,  shall
be equal to the aggregate Fair Market Value, on the date the Performance  Shares
are earned,  of the number of Shares of Common  Stock equal to each  Performance
Share  earned.  A fractional  Share will not be  deliverable  when a Performance
Share Award is earned, but a cash payment will be made in lieu thereof.

         9.4  SHAREHOLDER  RIGHTS.  No  Participant  shall have,  as a result of
receiving a Performance  Share Award,  any rights as a shareholder  until and to
the  extent  that  the  Performance  Shares  are  earned  and  Common  Stock  is
transferred to such Participant. If the Agreement so provides, a Participant may
receive a cash payment equal to the dividends  that would have been payable with
respect to the number of Shares of Common Stock covered by the Award between (a)
the  date  that the  Performance  Shares  are  awarded  and (b) the date  that a
transfer of Common Stock to the  Participant,  cash  settlement,  or combination
thereof is made pursuant to the  Performance  Share Award. A Participant may not
sell,  transfer,  pledge,  exchange,  hypothecate,  or  otherwise  dispose  of a
Performance  Share Award or the right to receive Common Stock  thereunder  other
than by will or the laws of descent and distribution.  After a Performance Share
Award is earned and paid in Common Stock, a Participant will have all the rights
of a shareholder with respect to the Common Stock so awarded.


ARTICLE 10.  BENEFICIARY DESIGNATION

         To the extent  applicable,  each  Participant  under the Plan may, from
time  to  time,  name  any  beneficiary  or  beneficiaries  (who  may  be  named
contingently or  successively)  to whom any benefit under the Plan is to be paid
in  case  of his or her  death  before  he or she  receives  any or all of  such
benefit.  Each such designation shall revoke all prior  designations by the same
Participant, shall be in a form prescribed by the Company and shall be effective

                                       12
<PAGE>

only when filed by the  Participant,  in writing,  with the  Company  during the
Participant's  lifetime.  In the  absence  of  any  such  designation,  benefits
remaining unpaid at the  Participant's  death shall be paid to the Participant's
estate.  If  required,  the  spouse  of a  married  Participant  domiciled  in a
community  property  jurisdiction shall join in any designation of a beneficiary
or beneficiaries other than the spouse.


ARTICLE 11.  DEFERRALS

         The  Committee  may permit a  Participant  to defer to another  plan or
program such Participant's receipt of Shares or cash that would otherwise be due
to such  Participant  by virtue of the  exercise  of an Option,  the  vesting of
Restricted  Stock,  or the earning of a  Performance  Share  Award.  If any such
deferral  election is required or permitted,  the Committee  shall,  in its sole
discretion, establish rules and procedures for such payment deferrals.


ARTICLE 12.  RIGHTS OF EMPLOYEES

         12.1  EMPLOYMENT.  Nothing in the Plan shall interfere with or limit in
any way the right of the Company or a Subsidiary to terminate any  Participant's
employment  by, or  performance  of services  for, the Company at any time,  nor
confer  upon any  Participant  any right to continue in the employ or service of
the Company or a Subsidiary. For purposes of the Plan, transfer of employment of
a Participant  between the Company and any one of its  Subsidiaries  (or between
Subsidiaries) shall not be deemed a termination of employment.

         12.2 PARTICIPATION.  No Employee shall have the right to be selected to
receive an Award under this Plan, or, having been so selected, to be selected to
receive a future Award.


ARTICLE 13.  CHANGE IN CONTROL

         13.1 DEFINITION.  For purposes of the Plan, a "Change in Control" means
any of the following events:

         (a)      The acquisition (other than from the Company) by any Person of
                  Beneficial  Ownership of twenty-five  percent (25%) or more of
                  the combined  voting power of the Company's  then  outstanding
                  voting  securities;  provided,  however,  that for purposes of
                  this Section 13.1,  Person shall not include any person who on
                  the date hereof owns 10% or more of the Company's  outstanding
                  securities,  and a Change  in  Control  shall not be deemed to
                  occur solely because  twenty-five percent (25%) or more of the
                  combined  voting  power  of  the  Company's  then  outstanding
                  securities  is  acquired  by (i) a trustee or other  fiduciary
                  holding  securities  under one or more employee  benefit plans
                  maintained by the Company or any of its subsidiaries,  or (ii)
                  any corporation, which, immediately prior to such acquisition,
                  is owned  directly or  indirectly by the  shareholders  of the
                  Company in the same  proportion as their ownership of stock in
                  the Company immediately prior to such acquisition.

                                       13
<PAGE>

         (b)      Approval  by  shareholders  of the  Company of (1) a merger or
                  consolidation involving the Company if the shareholders of the
                  Company,  immediately  before such merger or  consolidation do
                  not,  as a  result  of  such  merger  or  consolidation,  own,
                  directly or  indirectly,  more than fifty percent (50%) of the
                  combined   voting  power  of  the  then   outstanding   voting
                  securities of the  corporation  resulting  from such merger or
                  consolidation  in  substantially  the same proportion as their
                  ownership  of  the   combined   voting  power  of  the  voting
                  securities of the Company outstanding  immediately before such
                  merger or  consolidation,  or (2) a  complete  liquidation  or
                  dissolution  of the  Company or an  agreement  for the sale or
                  other disposition of all or substantially all of the assets of
                  the Company.

         (c)      A  change  in the  composition  of the  Board  such  that  the
                  individuals  who, as of the  Effective  Date,  constitute  the
                  Board  (such  Board  shall be  hereinafter  referred to as the
                  "Incumbent Board") cease for any reason to constitute at least
                  a majority of the Board;  provided,  however,  for purposes of
                  this Section 13.1 that any  individual who becomes a member of
                  the Board subsequent to the Effective Date whose election,  or
                  nomination  for election by the  Company's  shareholders,  was
                  approved by a vote of at least a majority of those individuals
                  who are members of the Board and who were also  members of the
                  Incumbent  Board  (or  deemed  to be  such  pursuant  to  this
                  proviso) shall be considered as though such  individual were a
                  member of the Incumbent Board; but,  provided,  further,  that
                  any such individual whose initial  assumption of office occurs
                  as a result of either an actual or threatened election contest
                  (as such  terms  are used in Rule  14a-11  of  Regulation  14A
                  promulgated under the Exchange Act, including any successor to
                  such Rule),  or other  actual or  threatened  solicitation  of
                  proxies or consents by or on behalf of a Person other than the
                  Board, shall not be so considered as a member of the Incumbent
                  Board.

         13.2  LIMITATION ON AWARDS.  The Committee may provide in the Agreement
that, if the right to receive or benefit from any Award under this Plan,  either
alone or together with payments that a Participant has the right to receive from
the Company or a Subsidiary,  would constitute a "parachute payment" (as defined
in Section 280G of the Code),  all such payments shall be reduced to the largest
amount that will result in no portion being subject to the excise tax imposed by
Section 4999 of the Code.


ARTICLE 14.  AMENDMENT, MODIFICATION AND TERMINATION

         14.1 AMENDMENT,  MODIFICATION  AND  TERMINATION.  The Board may, at any
time and from time to time, alter, amend, suspend or terminate the Plan in whole
or in part; provided,  that, the Board may determine that any such action should
become effective only if approved by the  shareholders  even if such shareholder
approval is not expressly required by the Plan or by law.

         14.2  AWARDS   PREVIOUSLY   GRANTED.   No  termination,   amendment  or
modification  of the Plan shall  adversely  affect in any material way any Award
previously   granted  under  the  Plan,  without  the  written  consent  of  the

                                       14
<PAGE>

Participant holding such Award. The Committee shall, with the written consent of
the  Participant  holding  such  Award,  have the  authority  to  cancel  Awards
outstanding and grant replacement Awards therefor.

         14.3  COMPLIANCE  WITH  CODE  SECTION  162(M).  At all  times  when the
Committee  determines  that  compliance  with Code Section 162(m) is required or
desired,  all Awards granted under this Plan to Named  Executive  Officers shall
comply with the requirements of Code Section 162(m).  In addition,  in the event
that changes are made to Code Section 162(m) to permit greater  flexibility with
respect to any Award or Awards under the Plan,  the  Committee  may,  subject to
this Article 14, make any adjustments it deem appropriate.


ARTICLE 15.  WITHHOLDING

         15.1 TAX WITHHOLDING. The Company shall have the power and the right to
deduct or withhold,  or require a Participant to remit to the Company, an amount
sufficient  to  satisfy   federal,   state  and  local  taxes   (including   the
Participant's  FICA  obligation)  required by law to be withheld with respect to
any taxable event arising in connection with an Award under this Plan.

         15.2 SHARE WITHHOLDING.  With respect to withholding  required upon the
exercise  of Options,  or upon any other  taxable  event  arising as a result of
Awards  granted  hereunder  which  are  to  be  paid  in  the  form  of  Shares,
Participants may elect, subject to the approval of the Committee, to satisfy the
withholding  requirement,  in whole or in part,  by having the Company  withhold
Shares having a Fair Market Value on the date the tax is to be determined  equal
to the minimum  statutory  total tax which could be imposed on the  transaction.
All elections shall be irrevocable,  made in writing, signed by the Participant,
and elections by Insiders shall additionally  comply with all legal requirements
applicable to Share transactions by such Participants.


ARTICLE 16.  INDEMNIFICATION

         Each person who is or shall have been a member of the Committee, or the
Board,  shall be indemnified  and held harmless by the Company  against and from
any loss,  cost,  liability or expense  that may be imposed  upon or  reasonably
incurred by him or her in connection  with or resulting from any claim,  action,
suit or  proceeding  to which he or she may be a party or in which he or she may
be involved  by reason of any action  taken or failure to act under the Plan and
against and from any and all amounts paid by him or her in  settlement  thereof,
with the Company's  approval,  or paid by him in satisfaction of any judgment in
any such action,  suit or  proceeding  against  him,  provided he shall give the
Company an opportunity, at its own expense, to handle and defend the same before
he undertakes to handle and defend it on his own behalf.  The foregoing right of
indemnification  shall be in addition to any other rights of  indemnification to
which such persons may be entitled under the Company's Articles of Incorporation
or Bylaws,  as a matter of law, or otherwise,  or any power that the Company may
have to indemnify them or hold them harmless.


ARTICLE 17.  SUCCESSORS

         All  obligations of the Company under the Plan,  with respect to Awards
granted hereunder, shall be binding on any successor to the Company, whether the
existence  of such  successor  is the result of a direct or  indirect  purchase,
merger,  consolidation or otherwise, of all or substantially all of the business
and/or assets of the Company.

                                       15
<PAGE>


ARTICLE 18.  LEGAL CONSTRUCTION

         18.1  GENDER  AND  NUMBER.  Except  where  otherwise  indicated  by the
context,  any masculine  term used herein shall also include the  feminine;  the
plural shall include the singular and the singular shall include the plural.

         18.2  SEVERABILITY.  If any provision of the Plan shall be held illegal
or invalid for any reason,  the  illegality or  invalidity  shall not affect the
remaining  parts of the Plan, and the Plan shall be construed and enforced as if
the illegal or invalid provision had not been included.

         18.3  REQUIREMENTS  OF LAW.  The granting of Awards and the issuance of
Shares  under  the Plan  shall be  subject  to all  applicable  laws,  rules and
regulations,  and to such  approvals  by any  governmental  agencies or national
securities exchanges as may be required.

         18.4  REGULATORY  APPROVALS  AND  LISTING.  The  Company  shall  not be
required to issue any  certificate  or  certificates  for Shares  under the Plan
prior to (i)  obtaining  any  approval  from any  governmental  agency which the
Company shall, in its discretion,  determine to be necessary or advisable,  (ii)
the admission of such shares to listing on any national  securities  exchange or
Nasdaq on which the Company's Shares may be listed,  and (iii) the completion of
any  registration  or other  qualification  of such  Shares  under  any state or
federal law or ruling or regulation of any  governmental  body which the Company
shall, in its sole discretion, determine to be necessary or advisable.

         Notwithstanding  any other provision set forth in the Plan, if required
by the then-current Section 16 of the Exchange Act, any "derivative security" or
"equity security" offered pursuant to the Plan to any Insider may not be sold or
transferred  for at least six (6) months  after the date of grant of such Award.
The terms "equity  security" and  "derivative  security" shall have the meanings
ascribed to them in the then-current Rule 16(a) under the Exchange Act.

         18.5 SECURITIES LAW COMPLIANCE. With respect to Insiders,  transactions
under this Plan are intended to comply with all  applicable  conditions  of Rule
16b-3 or its successors  under the Exchange Act. To the extent any provisions of
the Plan or action by the Committee fails to so comply,  it shall be deemed null
and void, to the extent permitted by law and deemed advisable by the Committee.

         18.6  GOVERNING  LAW. To the extent not  preempted  by Federal law, the
Plan, and all agreements  hereunder,  shall be construed in accordance  with and
governed by the laws of the State of Georgia.

         AS APPROVED BY THE BOARD OF DIRECTORS OF COMMUNITY BANKSHARES,  INC. ON
DECEMBER 22, 1999.