Document:

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                                                                    EXHIBIT 10.1

                         EXECUTIVE EMPLOYMENT AGREEMENT

This Executive Employment Agreement ("Agreement") is entered into as of the 11h
day of February, 2008, by and between Lotus Bancorp, Inc. ("Company"), a
corporation organized under the laws of the State of Michigan, and Christer
Lucander, an adult individual residing in the State of Michigan (hereafter the
"Executive").

WHEREAS, the Executive has considerable experience, expertise and training in
management related to banking and services to be offered by the Company and to
be offered through Lotus Bank, the subsidiary bank of the Company ("Bank");

WHEREAS, the Company desires and intends to cause the Executive to be employed
as Chief Lending Officer of the Bank and the Company and hold the title of
Executive Vice President pursuant to the terms and conditions set forth in this
agreement; and

WHEREAS, both the Company and the Executive have read and understood the terms
and provisions set forth in this Agreement, and have been afforded a reasonable
opportunity to review this Agreement with their respective legal counsel.

NOW, THEREFORE, in consideration of the mutual promises and covenants set forth
in this Agreement, the Executive and the Company agree as follows:

                                    DURATION

1. This Agreement shall continue in full force and effect for a period beginning
on February 11, 2008 and terminate by its own terms on the Expiration Date,
which is February 28, 2010, unless either party elects to terminate this
Agreement prior to the Expiration Date, in accordance with the TERMINATION
provisions set forth below.

2. Both the Company and the Executive acknowledge and agree that, subsequent to
the Expiration Date, the parties may agree to continue the employment
relationship upon such terms as they may mutually agree. Following the initial
term, this Agreement shall automatically renew annually for an additional one
(1) year term unless either party elects to terminate the Agreement by sending
written notice of non-renewal at least thirty (30) days prior to the expiration
of the then current term. Both parties acknowledge and agree that in the event
that the Agreement does not renew, this Agreement shall automatically terminate
upon expiration of the then current term without any additional liability or
obligation on the part of either party, except as expressly provided herein.

                                  COMPENSATION

3. All payments of salary and other compensation to the Executive shall be
payable in accordance with the Company's or Bank's ordinary payroll and other
policies and procedures.

     a. For the first year of the Agreement, the Executive will receive a salary
     of $115,000.00, payable on a semi-monthly basis in equal amounts of
     $4,791.67, and appropriately prorated for partial months at the
     commencement and end of the term of the Agreement.

     b. During the remaining term of the Agreement, the Executive's annual
     salary shall be reviewed by the Company's Board of Directors as of the 31st
     day of December of each year commencing December 31, 2008, as provided in
     Paragraph 6 of this Agreement.

     c. During the term of this Agreement, it is anticipated that a
     disinterested majority of the Board of Directors of the Company will
     consider the adoption of an executive discretionary bonus plan. The Board
     will have the sole discretion whether to adopt such a bonus plan and, if
     so, when bonuses will be paid there under.

     d. The Company shall grant to the Executive a number of options exercisable
     within ten (10) years from the date of the grant of such options. Such
     options, upon grant of the options, will enable the Executive to purchase a
     number of shares of Company stock equal to one quarter of one percent
     (1/4%) of the total number of common shares issued in the initial stock
     public offering. The exercise price for the stock options to be received by
     the Executive shall be equal to the offering price of the Company's common
     stock in its initial offering. The terms of the Company's stock option plan
     shall control in the event of any conflict with the terms of this
     Agreement. The options shall be evidenced by a stock option agreement,
     which shall have terms as are consistent with those set forth above and
     such additional terms

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     as may be set forth in the stock option agreement or the stock option plan
     pursuant to which the options are granted. To the maximum extent permitted
     by law, the options will be treated as incentive stock options.

     Both the Company and the Executive acknowledge that such compensation and
     the other covenants and agreements of the Company contained herein are fair
     and adequate compensation for the Executive's services, and for the mutual
     promises described below.

     e. Executive shall also be entitled to participate in any benefit programs
     applicable to all employees of the Company or Bank, as applicable, or to
     executive employees of the Company or Bank in accordance with Company or
     Bank policy and the provisions of said programs. Such benefits may include
     employee and dependent health and dental insurance, disability insurance
     with coverage equal to the Executive's current salary at the time of any
     disability, and profit sharing and other retirement plans.

     f. The Company or Bank shall also provide the Executive with a salary
     continuation plan, with such terms as are approved by the Board of
     Directors of the Bank or the Company, as the case might be. The Company
     shall also permit the Executive to participate in a 401K plan once such
     plan is established by the Company or the Bank.

     g. The Executive is eligible for an annual bonus in an amount to be
     determined based on performance goals established annually by the Chief
     Executive Officer and the Board of Directors; provided that the Executive
     shall only be eligible for the annual bonus if the Bank's Composite CAMELS
     rating is a 1 or 2 from the applicable bonus year.

4. The Company shall reimburse the Executive for all reasonable expenses
including, but not limited to, travel expenses, lodging expenses, meals and
entertainment expenses and trade association memberships. The Executive will
receive reimbursement for all business-related cell phone expenses in an amount
of $100.00 per month. The Executive shall be required to submit receipts or
other acceptable documentation to the Cashier or other appropriate bank officer
to verify such expenses prior to any reimbursements. In lieu of business mileage
reimbursement, the Executive shall receive an automobile allowance in an amount
of $500.00 per month.

5. Subject to the provisions of Paragraph 7 of this Agreement, the Executive
shall be entitled to four (4) weeks of paid vacation per calendar year
commencing 2008 on a non-cumulative basis.

6. During the term of this Agreement, the Executive's compensation will be
subject to an annual review consistent with safe and sound banking practices and
in the discretion of the Board of Directors of the Company but, in no event,
will the Executive's salary and vacation be less than the amounts set forth in
Paragraphs 3, 4, and 5 at any time during the term of this agreement.

7. All employee benefits provided to the Company or Bank incident to the
Executive's employment shall be governed by the applicable plan documents,
summary plan descriptions or employment policies, and may be modified, suspended
or revoked at any time, in accordance with the terms and provisions of the
applicable documents.

8. The Company shall have the right to deduct from any payment of compensation
to Executive hereunder any federal, state or local taxes required by law to be
withheld with respect to such payments and any other amounts specifically
authorized to withheld or deducted by Executive.

                                RESPONSIBILITIES

9. The Executive shall be employed as Chief Lending Officer of the Bank and the
Company and will hold the title of Executive Vice President. The Executive
covenants and agrees that he will faithfully devote his best efforts and his
primary focus to his positions with the Bank and the Company and their
respective subsidiaries.

10. The Executive acknowledges and agrees that the duties and responsibilities
of the Executive required by his position as Chief Lending Officer of the Bank
and the Company are wholly within the discretion of the Chief Executive Officer,
and may be modified, or new duties and responsibilities imposed by the Chief
Executive Officer, at any time, without the approval or consent of the
Executive. However, these new duties and responsibilities may not constitute
immoral or unlawful acts. In addition, the new duties and responsibilities must
be consistent with the Executive's role as Chief Lending Officer of a financial
institution.

11. The Executive acknowledges and agrees that, during the term of this
Agreement, he has a fiduciary duty of loyalty to the Company and the Bank, and
that he will not engage in any activity during the term of this Agreement, which
will or could, in any significant way, harm the business, business interests, or
reputation of the Company or the Bank.

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                                 NONCOMPETITION

12. The Executive acknowledges and agrees that he will not, at any time during
the existence of the employment relationship between the Company or the Bank,
directly or indirectly engage in competition with the Company or the Bank, and
the Executive will not on his own behalf, or as another's agent, employee,
partner, shareholder or otherwise, engage, in any of the same or similar duties
and/or responsibilities required by the Executive's positions with the Company
or the Bank, other than as an employee of the Company or the Bank pursuant to
this Agreement, or as specifically approved by the Board of Directors. In
addition, without the prior written consent of the Board of Directors, Executive
shall not usurp for himself any corporate opportunity available to the Company
or the Bank.

The Executive covenants and agrees that for a period of six months subsequent to
a voluntary termination of this Agreement by the Executive, other than as a
result of a "constructive termination" as defined in Paragraph 17, the Executive
shall not directly or indirectly engage in competition with the Company or the
Bank, within Oakland County, (the "post voluntary termination non-compete area")
and the Executive will not on his own behalf, or as another's agent, employee,
partner, shareholder or otherwise, engage, within the post voluntary termination
non-compete area in any of the same or similar duties and/or responsibilities
required by the Executive's positions with the Company or the Bank. The
Executive acknowledges and agrees that the rights provided by this Paragraph to
the Company and the Bank are cumulative with other rights granted by the Company
or the Bank under this Agreement. The Company and the Bank covenant and agree
that if they choose to enforce the provisions of this Paragraph, the Executive
shall be entitled to payment of $57,500 or the equivalent of half the
Executive's then current salary, whichever is greater, less statutory payroll
deduction, payable in twelve (12) equal disbursements in accordance with
ordinary payroll policies and procedures, beginning with the first payroll after
the termination becomes effective.

If the Company or the Bank believes, in good faith after consultation with its
counsel, that Executive is in violation or breach of this Agreement, the Company
or the Bank, as applicable, may refuse to make further non-compete payments
under this Paragraph 12 and may seek full restitution of all non-compete
payments previously paid by the Company or the Bank to Executive up to and
including the date of such violation or breach by Executive.

The Executive also acknowledges and agrees that in exchange for the
non-competition agreement set forth in this paragraph, the Executive shall
receive substantial, valuable consideration including: (i) confidential trade
secret and proprietary information relating to the identity and special needs of
the Company's and Bank's current and prospective customers, the Company's and
Bank's current and prospective services, the Company's and Bank's business
projections and market studies, the Company's and Bank's business plans and
strategies, the Company's and Bank's studies and information concerning special
services unique to the Company and the Bank; and (ii) compensation and benefits
as described in this Agreement.

The Executive acknowledges and agrees that the non-competition restriction set
forth above is ancillary to an otherwise enforceable agreement and supported by
independent valuable consideration as required by law. Executive further
acknowledges and agrees that the limitations as to time, geographical area, and
scope of activity to be restrained by this Paragraph are reasonable and
acceptable to him, and do not impose any greater restraint than is reasonable
necessary to protect the goodwill and other business interests of the Company
and the Bank. Executive acknowledges and agrees that the primary purpose of the
restrictive covenants contained herein is to protect the proprietary information
and goodwill of the Company and the Bank.

The Executive acknowledges and agrees that if, at some later date, a court of
competent jurisdiction determines that the non-competition agreement set forth
in this Paragraph does not meet the criteria set forth by law, this paragraph
may be reformed by the court and enforced to the maximum extent permitted under
the laws of the State of Michigan.

If the Executive is found to have violated any of the provisions of any
restrictive covenant contained herein, Executive agrees that the restrictive
period of each covenant so violated shall be extended by a period of time equal
to the period of such violation by Executive. It is the intent of this Paragraph
that the running of the restrictive covenant period of any covenant shall be
tolled during any period of violation of such covenant so that the Company may
obtain the full and reasonable protection for which it contracted and so that
Executive may not profit by breach thereof.

                                 NONINTERFERENCE

13. The executive covenants and agrees that, for a period of six months
subsequent to the termination of this Agreement, whether such termination occurs
at the insistence of the Company or the Executive, the Executive shall not: (i)
recruit, hire, or attempt to recruit or hire, directly or by assisting others,
any other employees of the Company or the Bank (for purposes of this covenant,
"other employees" shall refer to employees who are still actively employed by,
or doing business with, the Company

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or the Bank at the time of the attempted recruiting or hiring) nor shall the
Executive contact or communicate with any other employees of the Company or the
Bank for the purpose of inducing other employees to terminate their employment
with the Company or the Bank or (ii) solicit, directly or by assisting others,
the banking business of any customers of the Company or the Bank as of the date
of such termination.

The Executive acknowledges and agrees that in exchange for the execution of the
noninterference agreement set forth above, the Executive shall receive
substantial, valuable consideration including: (i) confidential trade secret and
proprietary information relating to the identity and special needs of the
Company's and Bank's current and prospective customers, the Company's and Bank's
current and prospective services, the Company's and Bank's business projections
and market studies, the Company's and Bank's business plans and strategies, the
Company's and Bank's studies and information concerning special services unique
to the Company and the Bank; and (ii) compensation and benefits as described in
this Agreement. The Executive acknowledges and agrees that this constitutes fair
and adequate consideration for the execution of the noninterference agreement as
set forth above.

                                    REMEDIES

14. In the event that the Executive violates any of the provisions set forth in
this Agreement relating to NONINTERFERENCE and NON-COMPETITION, the Executive
acknowledges and agrees that the Company and the Bank would suffer immediate and
irreparable harm and would not have an adequate remedy at law for money damages.
Accordingly, the Executive agrees that, without the necessity of proving actual
damages or posting bond or other security, the Company and the Bank shall be
entitled to temporary or permanent injunction or injunctions to prevent breaches
of such performance and to specific enforcement of such covenants in addition to
any remedy to which the Company or the Bank may be entitled, at law or in
equity. In such a situation, the parties agree that the Company or the Bank may
pursue any remedy available, including declaratory relief, concurrently or
consecutively in any order as to any breach, violation, or threatened breach or
violation of any of the provisions as set forth in this Agreement relation to
NONINTERFERENCE and NON-COMPETITION, and the pursuit of any particular remedy or
remedies shall not be deemed an election of remedies or waiver of the right to
pursue any other remedy.

                                   TERMINATION

15. The Chief Executive Officer and Board of Directors of the Company shall be
entitled to terminate this Agreement, for any reason, by providing the Executive
with thirty (30) days' written notice of the termination, delivered in person,
or by certified U.S. mail to the Executive's last known address reflected in the
Company's personnel records. Such notice shall be effective upon personal
delivery or three days after mailing by certified mail. However, if the
Agreement is terminated at the Company's insistence without "good cause" as
defined in this Agreement, the Company covenants and agrees to provide the
Executive with the SEVERANCE set forth below in this Agreement.

16. For purposes of this Agreement, "good cause" shall be defined as the
occurrence of one of the following events:

     (a) The Executive violates any provision of this Agreement or is grossly
     negligent in the performance of his duties hereunder, and fails to cure
     such violation or the effects of such gross negligence within ten (10) days
     after written notice to the Executive by the Company specifying in
     reasonable detail the alleged violation;

     (b) The Executive is indicted for a felony, or a misdemeanor involving
     moral turpitude;

     (c) A bank regulatory agency having jurisdiction over the Company or the
     Bank has issued a notice of intent (i.e. a "15 day letter") to pursue the
     suspension or removal of Executive by bank regulatory authorities; or

     (d) The Chief Executive Officer and/or the Board of Directors, in the
     exercise of his or its reasonable judgment and in good faith, determines
     that the Executive's job performance is substantially unsatisfactory and
     the Executive has failed to cure such performance within a reasonable
     period after written notice to the Executive by the Company or the Bank
     specifying in reasonable detail the nature of the unsatisfactory
     performance.

17. The Executive shall be entitled to terminate this Agreement at any time, for
any reason, with or without cause, by providing thirty (30) days written notice,
by personal delivery or certified U.S. mail, to the Company at its principal
business address of the Executive's intention to terminate this Agreement. Such
notice shall be effective upon personal delivery or three days after mailing by
certified mail. In the event that the Executive does so because of a
"constructive termination" as defined in this Agreement, the Company covenants
and agrees to provide the Executive with the SEVERANCE set forth below in this
Agreement. "Constructive termination" shall mean any circumstance pursuant to
which Executive's compensation is materially diminished, his job title is
changed to a position of lesser importance, or his responsibilities are
materially reduced.

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18. In the event of the Executive's death, this Agreement will terminate
immediately, without notice, on the date of the Executive's death. The Executive
acknowledges and agrees that, in the event of his death, the Company will pay to
the Executive's estate all compensation due and owing through the date of the
Executive's death.

19. This Agreement will terminate immediately, without notice, in the even the
Executive becomes physically or mentally disabled, as defined by 29 CFR Section
1630.2(g)(1), and cannot perform the essential functions of his position, with
or without reasonable accommodation for the period designated by the Executive's
disability insurance after which disability payments will begin.

20. The Executive acknowledges and agrees that in the event of termination of
this Agreement, for whatever reason, whether at the insistence of the Executive
or at the insistence of the Company, the Executive will return to the Company
within seventy-two (72) hours of the time when notice of termination is
communicated by either party, or sooner if requested by the Company, any and all
equipment, literature, documents, data, information, order forms, memoranda,
correspondence, customer and prospective customer lists, customer's orders,
records, cards or notes acquired, compiled or coming into the Executive's
knowledge, possession or control in connection with his activities as an
employee of the Company or the Bank, as well as all machines, parts, equipment
or other materials received from the Company or the Bank or from any of their
respective customers, agents or suppliers, in connection with such activities.

21. The provisions of Paragraphs 12-14, 20-25, 30 and 36 shall survive the
termination of this Agreement.

                                CHANGE IN CONTROL

22. The parties acknowledge that the Executive has agreed to assume the position
of Executive Vice President and Chief Lending Officer and to enter into this
Agreement based on his confidence in the current owners of the Company and the
direction of the Company provided by the current Board of Directors. If the
Company should undergo a "Change in Control", as defined below, and there is a
material change in the Executive's responsibilities, duties, terms or location
of employment, then the Executive, at his option, may notify the Company at any
time within sixty (60) days following such Change in Control, by personal
delivery or certified U.S. mail, that he intends to terminate this Agreement
based upon the Change in Control. Notice of termination shall be effective upon
delivery or three (3) days after mailing by certified mail.

23. In the event that the Executive elects to terminate this Agreement based
upon a Change in Control, the Company covenants and agrees to pay the Executive
cash payments in an aggregate amount equal to 125% of Executive's then current
annual salary or $143,750, whichever is greater, less statutory payroll
deductions. Such compensation shall be payable in equal disbursements in
accordance with the Company's ordinary payroll policies and procedures.

24. As used in this Agreement, a "Change in Control" shall be deemed to have
occurred in any one of the following circumstances:

     (a) the Company or the Bank is merged or consolidated with another
     corporation and as the result of such merger or consolidation is less than
     fifty percent (50%) of the outstanding voting securities (on a fully
     diluted basis) of the surviving or resulting corporation are owned in the
     aggregate by the former shareholders of the Company;

     (b) the Company or the Bank sell all or substantially all of its assets to
     another corporation; or

     (c) there is an acquisition of more than fifty percent (50%) of the
     outstanding voting securities of the Company pursuant to any transaction or
     combination of transactions by any person or group within the meaning of
     such terms in the Securities Exchange Act of 1934, as amended.

                                    SEVERANCE

25. If the Company elects to terminate this Agreement at any time prior to the
Expiration date for any reason other than "good cause" as defined in this
Agreement, or if Executive terminates this Agreement as a result of a
"constructive termination," the Executive shall be entitled to severance pay.
Such severance pay shall be equal to $57,500.00 or the equivalent of half the
Executive's then current salary, whichever is greater, less statutory payroll
deductions, payable in twelve (12) equal disbursements in accordance with the
Company's ordinary payroll policies and procedures, beginning on the date that
the notice of termination becomes effective. In the event that the Executive is
entitled to payment under the CHANGE IN CONTROL or NON-COMPETITION provisions
above, no payment shall be due under this SEVERANCE provision.

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                                  SEVERABILITY

26. The Executive acknowledges and agrees that each covenant and/or provision of
the Agreement shall be enforceable independently of every other covenant and/or
provision. Furthermore, the Executive acknowledges and agrees that, in the event
any covenant and/or provision of this Agreement is determined to be
unenforceable for any reason, the remaining covenants and/or provisions will
remain effective, binding and enforceable.

                                     WAIVER

27. The parties acknowledge and agree that the failure of either to enforce any
provision of this Agreement shall not constitute a waiver of that particular
provision, or of any other provisions of this Agreement.

                             SUCCESSORS AND ASSIGNS

28. The Executive acknowledges and agrees that this Agreement may be assigned by
the Company to any successor-in-interest and shall inure to the benefit of, and
be fully enforceable by, any successor and/or assignee; and this Agreement will
be fully binding upon, and may be enforced by the Executive against, any
successor and/or assignee of the Company.

29. The Executive acknowledges and agrees that his obligations, duties and
responsibilities under this Agreement are personal and shall not be assignable,
and that this Agreement shall be enforceable by the Executive only. In the event
of the Executive's death, this Agreement shall be enforceable by the Executive's
estate, executors and/or representatives, only to the extent provided herein.

                                  CHOICE OF LAW

30. BOTH PARTIES ACKNOWLEDGE AND AGREE THAT THE LAW OF THE STATE OF MICHIGAN
WILL GOVERN THE VALIDITY, INTERPRETATION AND EFFECT OF THIS AGREEMENT, AND ANY
OTHER DISPUTE RELATING TO, OR ARISING OUT OF, THE EMPLOYMENT RELATIONSHIP
BETWEEN THE COMPANY AND THE EXECUTIVE.

                                  MODIFICATION

31. Both parties acknowledge and agree that this Agreement and the other
agreements and plans referenced herein constitute the complete and entire
agreement between the parties; that the parties have executed this Agreement
based upon the express terms and provisions set forth herein; that the parties
have not relied upon any representations, oral or written, which are not set
forth in this Agreement; that no previous agreement, oral or written, shall have
any effect on the terms and provisions of this Agreement; and that all previous
agreements, either oral or written, are expressly superseded and revoked by this
Agreement.

32. Both p[arties acknowledge and agree that the covenants and/or provisions of
this Agreement may not be modified by any subsequent agreement unless the
modifying agreement; (i) is in writing; (ii) contains an express provision
referencing this Agreement; (iii) is signed by the Executive; and (iv) is
approved by the Chief Executive Officer and a disinterested majority of the
Board of Directors.

                                 INDEMNIFICATION

33. During the term of this Agreement, the Company shall indemnify the Executive
against all judgments, penalties, fines, amounts paid in settlement and
reasonable expenses (including, but not limited to, attorney's fees) relating to
his employment by the Company to the fullest extent permissible under the
Company's Articles of Incorporation and the Bank's Articles of Association and
may purchase such indemnification insurance as the Board of Directors may from
time to time determine.

                               LEGAL CONSULTATION

34. The Executive and the Company acknowledge and agree that both parties have
been accorded a reasonable opportunity to review this Agreement with legal
counsel prior to executing this Agreement. The Executive acknowledges that he is
not represented by Howard & Howard, P.C. in connection with the preparation and
negotiation of this Agreement, and that Howard & Howard, P.C. represents the
Company.

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                                     NOTICES

35. Any and all notices of documents or other notices required to be delivered
under the terms of this Agreement shall be addressed to each party as follows:

EXECUTIVE

Christer D. Lucander
116 Hall Place
Grosse Pointe farms, MI 48326

COMPANY

Lotus Bancorp, Inc.
Lotus Bank
45650 Grand River Ave.
Novi, MI 48374

                                  MISCELLANEOUS

36. The Executive shall make himself available, upon the request of the Company
or the Bank, to testify or otherwise assist in litigation, arbitration, or other
disputes involving the Company or the Bank, or any of the directors, officers,
employees, subsidiaries, or parent corporations of either, at no additional cost
during the term of this Agreement and at any time following the termination of
this Agreement.

37. The Executive shall not be required to mitigate the amount of any payment
provided for in this Agreement by seeking other employment or otherwise, nor
shall the amount of any payment provided for in this Agreement be reduced by any
compensation earned by the Executive as the result of employment by another
employer after the date of termination, or otherwise.

38. In the event either party institutes litigation to enforce or protect its
rights under this Agreement, the prevailing party in such litigation shall be
entitled, in addition to all other relief, to reasonable attorney fees,
out-of-pocket costs, disbursements, and fees relating to such litigation.

39. This Agreement shall be executed simultaneously in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same Agreement.

40. Neither the Company nor the Bank shall have any obligation to set aside,
earmark or entrust any fund or money with which to pay its obligations under
this Agreement. The Executive or any successor-in-interest to Executive shall be
and remain simply a general creditor of the Company or the Bank in the same
manner as any other creditor having a general unsecured claim. For purposes of
the Code, the Company intends this Agreement to be an unfunded, unsecured
promise to pay on the part of the Company. For purposes of Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), the Company intends that this
Agreement shall not be subject to ERISA. If it is deemed to be subject to ERISA,
it is intended to be an unfunded arrangement for the benefit of a select member
of management, who is a highly compensated employee of the Company for the
purpose of qualifying this Agreement for the "top hat" plan exception under
sections 201(2), 301(a)(3) and 401(a)(1) of ERISA. At no time shall the
Executive have or be deemed to have any lien nor right, title or interest in or
to any specific investment or to any assets of the Company or the Bank. If the
Company or Bank elects to invest in a life insurance, disability or annuity
policy upon the life of the Executive, the Executive shall assist the Company
and Bank by freely submitting to a physical examination and supplying such
additional information necessary to obtain such insurance or annuities.

41. When a reference is made in this Agreement to a Paragraph, such reference
shall be to a Paragraph of this Agreement unless otherwise indicated. The
headings contained in this Agreement are for convenience of reference only and
shall not affect in any way the meaning or interpretation of this Agreement.
Whenever the words "include", "includes" or "including" are used in this
Agreement, they shall be deemed to be followed by the words "without
limitation." The words "hereof", "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision in this Agreement. Each use herein of the
masculine, neuter or feminine gender shall be deemed to include the other
genders. Each use herein of the plural shall include singular and vice-versa, in
each case as the

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context requires or as is otherwise appropriate. The word "or" is used in the
inclusive sense. Any agreement or instrument defined or referred to herein or in
any agreement or instrument that is referred to herein mean such agreement or
instrument as from time to time amended, modified, or supplemented, including by
waiver or consent. References to a person are also to its permitted successors
or assigns.

42. Executive represents that his service as an employee of the Company and Bank
will not violate any agreement: (i) he has made that prohibits him from
disclosing any information he acquired prior to his becoming employed by the
Company or the Bank; or (ii) he has made that prohibits him from accepting
employment with the Company or the Bank or that will interfere with his
compliance with the terms of this Agreement. Executive further represents that
he has not previously, and will not in the future, disclose to the Company or
the Bank any proprietary information or trade secrets belonging to any previous
employer. Executive acknowledges that the Company and the Bank have instructed
him not to disclose to it any proprietary information or trade secrets belonging
to any previous employer.

EXECUTED ON THIS DATE FIRST WRITTEN ABOVE IN _____________________________.

                                        "EXECUTIVE"

/s/ Richard E. Bauer                    /s/ Christer D. Lucander
-------------------------------------   ----------------------------------------
Witness                                 Christer D. Lucander

                                        "COMPANY"

                                        LOTUS BANCORP, INC.

/s/ Richard E. Bauer                    /s/ Satish Jasti
-------------------------------------   ----------------------------------------
Witness                                 Satish Jasti
                                        President & CEO

                                       12exv10w1

 

Exhibit 10.1

CARRIAGE SERVICES, INC.

PERFORMANCE UNIT AWARD AGREEMENT

Name

 

Grantee

	 	 	 	 	 	 	 
	 

	 	Award Date:
	 	August 7, 2007

	 

	 	Performance Unit Value:
	 	$ 1.00  	 
	 

	 	Number of Performance Units Awarded:
	 	                                                            

AWARD OF PERFORMANCE UNITS

     The Compensation Committee (the “Committee”) of the Board of Directors of Carriage Services,
Inc., a Delaware corporation (the “Company”), pursuant to the Carriage Services, Inc. 2006
Long-Term Incentive Plan (the “Plan”), hereby awards to you, the above-named Grantee, effective as
of the Award Date set forth above, that number of Performance Units set forth above (each, a
"Performance Unit”, and collectively, the “Performance Units”), on the terms and conditions set
forth in this Performance Unit Award Agreement (this “Agreement”).

     One-half of the Performance Units awarded under this Agreement (the “Peer Group 1 Performance
Units”) provide you an opportunity to earn a cash payment based upon the Total Shareholder Return
achieved by the Company for the period beginning August 7, 2007, and ending December 31, 2009 (the
"Performance Period”) as compared with the Total Shareholder Return achieved by the companies
constituting the Russell Microcap Index as reported by Russell Investment Group (Russell). The
Russell Microcap Index is reconstituted annually to add or eliminate stocks according to Russell’s
microcap segment criteria. For purposes of the Plan, the Shareholder Return reported by Russell
for each period shall be used to calculate cash payments without adjustment for changes in the
companies constituting the Microcap Index. The other one-half of the Performance Units awarded
under this Agreement (the “Peer Group 2 Performance Units”) provide you an opportunity to earn a
cash payment based upon the Total Shareholder Return achieved by the Company for the Performance
Period as compared with the Total Shareholder Return achieved by Service Corporation International
and Stewart Enterprises, Inc. The Committee may not increase the amount payable under this
Agreement.

     “Total Shareholder Return” shall mean the difference between (i) the per share closing price
on the last trading day of the Performance Period of the common stock of the entity with respect to
which such computation is being made as reported by the principal stock exchange on which such
entity’s common stock is traded, and (ii) the per share closing price of such common stock on
August 7, 2007, as reported by the principal stock exchange on which the entity’s common stock is
traded, calculated assuming all cash and other dividends paid on such common stock during the
Performance Period are immediately reinvested in shares of such common stock.

1

 

     As soon as reasonably practicable after the end of the Performance Period, the Committee will
calculate the Total Shareholder Returns for the Performance Period of the Company and each of the
members of Performance Peer Group 1 and Performance Peer Group 2. If the following conditions
exist with respect to the Performance Period:

               (1) your employment with the Company and all of its Affiliates has not
terminated on or before the last day of the Performance Period; and

               (2) a Corporate Change does not occur on or before the last day of the
Performance Period;

then you shall receive a cash payment under this Agreement equal to the sum of (i) the Peer Group 1
Performance Payment and (ii) the Peer Group 2 Performance Payment.

     The Peer Group 1 Performance Payment shall be equal to:

               (A) multiplied by (B) multiplied by (C)

where (A) is the number of Peer Group 1 Performance Units, (B) is the Peer Group 1 Earned Award
Factor (as that term has been defined by the attached table) and (C) the Performance Unit Value set
forth above.

     The Peer Group 2 Performance Payment shall be equal to:

               (X) multiplied by (Y) multiplied by (Z)

where (X) is the number of Peer Group 2 Performance Units, (Y) is the Peer Group 2 Earned Award
Factor (as that term has been defined by the attached table) and (Z) is the Performance Unit Value
set forth above.

     If the Peer Group 1 Earned Award Factor and the Peer Group 2 Earned Award Factor for the
Performance Period are both zero and a Corporate Change of the Company has not occurred on or
before the last day of the Performance Period, then the award pursuant to this Agreement shall
lapse and be forfeited as of December 31, 2009.

     The Committee’s determination of Total Shareholder Return for the Company and each member of
Performance Peer Group 1 and Performance Peer Group 2 for the Performance Period for purposes of
this Agreement shall be binding upon all persons.

     Any amount payable to you pursuant to this Agreement will be paid to you by the Company on
March 15, 2010, unless otherwise provided as hereinafter otherwise set out. Such payment will be
made to you in exchange for the Performance Units and thereafter you shall have no further rights
with respect to such Performance Units or this Agreement.

2

 

     The following provisions 1.1 to 1.5 will apply in the event a Corporate Change of the Company
occurs, or your employment with the Company and all Affiliates (collectively, the “Company Group”)
terminates, before the last day of the Performance Period.

1.1 Termination Generally. If your employment with the Company Group terminates on
or before the last day of the Performance Period for any reason other than one of the
reasons described in Sections 1.2 through 1.5 below, all of your rights in this Agreement,
including all rights to the Performance Units awarded to you, will lapse and be completely
forfeited on the date your employment terminates.

1.2 Potential or Actual Corporate Change.

(i) Termination Without Cause or for Good Reason in Connection With a Potential
Corporate Change on or Before the Last Day of the Performance Period. If (a)
the Company Group terminates your employment without Cause on or before the last day
of the Performance Period prior to a Corporate Change of the Company (whether or not
a Corporate Change ever occurs) and such termination is at the request or direction
of a person who has entered into an agreement with the Company the consummation of
which would constitute a Corporate Change of the Company or is otherwise in
connection with or in anticipation of a Corporate Change of the Company (whether or
not a Corporate Change ever occurs) or (b) you terminate your employment with the
Company Group for Good Reason on or before the last day of the Performance Period
prior to a Corporate Change of the Company (whether or not a Corporate Change ever
occurs) and such termination or the circumstance or event which constitutes Good
Reason occurs at the request or direction of a person who has entered into an
agreement with the Company the consummation of which would constitute a Corporate
Change of the Company or is otherwise in connection with or in anticipation of a
Corporate Change of the Employer (whether or not a Corporate Change ever occurs),
then the Company will pay to you in cash an amount determined under the following
formula in lieu of any other amounts under this Agreement:

(1) multiplied by (2)

where (1) is the Performance Unit Value set forth in this Agreement and (2) is the
number of Performance Units that were awarded to you under this Agreement. Any
amount payable to you pursuant to this Section 1.2(i) will be paid by the Company to
you ten (10) business days after the date of your Separation From Service if you are
not a Specified Employee or on the date that is six months following your Separation
From Service if you are a Specified Employee. Such payment will be made to you in
exchange for the Performance Units and thereafter you shall have no further rights
with respect to such Performance Units or this Agreement and the Company Group will
have no further obligations to you pursuant to the Performance Units or this
Agreement. For purposes of this Agreement, “Separation From Service” has the
meaning ascribed to that term in Section 409A and “Specified Employee” means a
person who is, as of the date of the person’s Separation From Service, a “specified
employee” within the meaning of Section 409A, taking into account the elections made
and procedures

3

 

established in resolutions adopted by the Board of Directors of the Company. For
purposes of this Agreement, “Section 409A”
means section 409A of the Internal Revenue Code of 1986, as amended and the Department of Treasury rules and
regulations issued thereunder.

(ii) Employment Not Terminated Before a Corporate Change on or Before the Last
Day of the Performance Period. If a Corporate Change of the Company occurs on
or before the last day of the Performance Period and your employment with the
Company Group does not terminate before the date the Corporate Change of the Company
occurs, then the Company will pay to you in cash an amount determined under the
following formula in lieu of any other amounts under this Agreement:

(1) multiplied by (2)

where (1) is the Performance Unit Value set forth in this Agreement and (2) is the
number of Performance Units that were awarded to you under this Agreement. Any
amount payable to you pursuant to this Section 1.2(ii) will be paid by the Company
to you (a) ten (10) business days after the date the Corporate Change of the Company
occurs if the Corporate Change of the Company qualifies as a change in the ownership
or effective control of the corporation, or in the ownership of a substantial
portion of the assets of the corporation, within the meaning of Section 409A, or (b)
on March 15, 2010, if the Corporate Change of the Company does not so qualify. Such
payment will be made to you in exchange for the Performance Units and thereafter you
shall have no further rights with respect to such Performance Units or this
Agreement and the Company Group will have no further obligations to you pursuant to
the Performance Units or this Agreement.

1.3 Disability. Notwithstanding any other provision of this Agreement to the
contrary, if you become permanently disabled on or after the date that is one month after
the Award Date and is before the last day of the Performance Period, while in the active
employ of one or more members of the Company Group, then the Employer will pay to you in
cash an amount determined under the following formula in lieu of any other amounts under
this Agreement:

(1) multiplied by (2) multiplied by (3) divided by (4)

where (1) is the Performance Unit Value set forth in this Agreement, (2) is the number of
Performance Units that were awarded to you under this Agreement, (3) is the number of days
from (and including) the first day of the Performance Period to (and including) the day you
become permanently disabled, and (4) is the number of days during the Performance Period.
Any amount payable to you pursuant to this Section 1.3 will be paid by the Company to you
ten (10) business days after the date you become permanently disabled. Such payment will be
made to you in exchange for the Performance Units and thereafter you shall have no further
rights with respect to such Performance Units or this Agreement and the Company Group will
have no further obligations to you pursuant to the Performance Units or this Agreement. For
purposes of this Section 1.3, you will be “permanently disabled” if you (a) are unable to
engage in any substantial gainful activity

4

 

by reason of any medically determinable physical or mental impairment which can be expected
to result in death or can be expected to last for a continuous period of not less than 12
months, or (b) are, by reason of any medically determinable
physical or mental impairment which can be expected to result in death or can be expected to last for a
continuous period of not less than 12 months, receiving income replacement benefits for a
period of not less than three (3) months under an accident and health plan covering
employees of the Company Group.

1.4 Death. Notwithstanding any other provision of this Agreement to the contrary,
if you die before the last day of the Performance Period and while in the active employ of
one or more members of the Company Group, then the Employer will pay to your estate in cash
an amount determined under the following formula in lieu of any other amounts under this
Agreement:

(1) multiplied by (2) multiplied by (3) divided by (4)

where (1) is the Performance Unit Value set forth in this Agreement, (2) is the number of
Performance Units that were awarded to you under this Agreement, (3) is the number of days
from (and including) the first day of the Performance Period to (and including) the date of
your death, and (4) is the number of days during the Performance Period. Any amount payable
to your estate pursuant to this Section 1.4 will be paid to your estate by the Employer ten
(10) business days after the date of your death. Such payment will be made in exchange for
the Performance Units and thereafter your estate and heirs, executors, and administrators
shall have no further rights with respect to such Performance Units or this Agreement and
the Company Group will have no further obligations pursuant to the Performance Units or this
Agreement.

1.5 Retirement. Notwithstanding any other provision of this Agreement to the
contrary, if your employment with the Company Group terminates as a result of your
Retirement before the last day of the Performance Period, then the number of Performance
Units issued to you under this Agreement shall automatically be reduced (without further
action by you and/or the Company) on the date your employment relationship with the Company
Group terminates to that number of Performance Units determined under the following formula
(the “Retirement Adjusted Performance Units”):

(1) multiplied by (2) divided by (3)

where (1) is the number of Performance Units that were originally awarded to you under this
Agreement, (2) is the number of days from (and including) the first day of the Performance
Period to (and including) the day before the date your employment relationship with the
Company Group terminates due to Retirement, and (3) is the number of days during the
Performance Period. Your Peer Group 1 Performance Units and Peer Group 2 Performance Units
under this Agreement shall be reduced accordingly to reflect the Retirement Adjusted
Performance Units and the excess of the Performance Units that were originally awarded to
you under this Agreement over the Retirement Adjusted Performance Units shall be immediately
forfeited on the date of the termination of your employment relationship with the Company
Group due to Retirement. Any amount payable to you pursuant to this Agreement will be paid
on March 15, 2010. For purposes of this Section 1.5, the term “Retirement” means the
voluntary termination of your employment relationship with the Company Group on or after the date on which the sum of
your age and years of service with the Company Group equals 65.

5

 

     PROHIBITED ACTIVITY. Notwithstanding any other provision of this Agreement, if you engage in
a “Prohibited Activity,” as described below, while employed by one or more members of the Company
Group, during the Performance Period or within two years after the date your employment with the
Company Group terminates, then your right to receive payment under this Agreement, to the extent
still outstanding at that time, shall be completely forfeited. A “Prohibited Activity” shall be
deemed to have occurred, as determined by the Committee in its sole and absolute discretion, if you
divulge any non-public, confidential or proprietary information of the Company or of its past,
present or future affiliates (collectively, the “Carriage Services Inc. Group”), but excluding
information that (a) becomes generally available to the public other than as a result of your
public use, disclosure, or fault, or (b) becomes available to you on a non-confidential basis after
your employment termination date from a source other than a member of the Carriage Services Inc.
Group prior to the public use or disclosure by you, provided that such source is not bound by a
confidentiality agreement or otherwise prohibited from transmitting the information by a
contractual, legal or fiduciary obligation.

     TAX WITHHOLDING. To the extent that the receipt of the Performance Units or any payment
pursuant to this Agreement results in income, wages or other compensation to you for any income,
employment or other tax purposes with respect to which the Company or any other member of the
Company Group has a withholding obligation, you shall deliver to the Company at the time of such
receipt or payment, as the case may be, such amount of money as the Company Group may require to
meet its obligation under applicable tax laws or regulations, and, if you fail to do so, the
Company is authorized to withhold from any payment under this Agreement or from any cash or stock
remuneration or other payment then or thereafter payable to you any tax required to be withheld by
reason of such taxable income, wages or compensation.

     NONTRANSFERABILITY. This Agreement is not transferable by you otherwise than by will or by the
laws of descent and distribution.

     CAPITAL ADJUSTMENTS AND REORGANIZATIONS. The existence of the Performance Units shall not
affect in any way the right or power of the Company to make or authorize any adjustment,
recapitalization, reorganization or other change in its capital structure or its business, engage
in any merger or consolidation, issue any debt or equity securities, dissolve or liquidate, or
sell, lease, exchange or otherwise dispose of all or any part of its assets or business, or engage
in any other corporate act or proceeding.

     PERFORMANCE UNITS DO NOT AWARD ANY RIGHTS OF A STOCKHOLDER. You shall not have the voting
rights or any of the other rights, powers or privileges of a holder of the stock of the Company
with respect to the Performance Units that are awarded hereby.

     EMPLOYMENT RELATIONSHIP. For purposes of this Agreement, you shall be considered to be in the
employment of the Company Group as long as you have an employment relationship with the Company
Group. The Committee shall determine any questions as to whether and when there has been a
termination of such employment relationship, and the cause of such termination, under the Plan and
the Committee’s determination shall be final and binding on all persons.

     NOT AN EMPLOYMENT AGREEMENT. This Agreement is not an employment agreement, and no provision
of this Agreement shall be construed or interpreted to create an employment relationship between
you and the Company or any Affiliate or guarantee the right to remain employed by the Company or
any Affiliate for any specified term.

6

 

     LIMIT OF LIABILITY. Under no circumstances will the Company or an Affiliate be liable for any
indirect, incidental, consequential or special damages (including lost profits) of any form
incurred by any person, whether or not foreseeable and regardless of the form of the act in which
such a claim may be brought, with respect to the Plan.

     EMPLOYER LIABLE FOR PAYMENT. Except as specified in Section 1.2, the legal entity that is a
member of the Company Group and that is classified by the Company Group as your employer (the
“Employer”) is liable for the payment of any amounts that become due under this Agreement.

     MISCELLANEOUS. This Agreement is awarded pursuant to and is subject to all of the provisions
of the Plan, including amendments to the Plan, if any. In the event of a conflict between this
Agreement and the Plan provisions, the Plan provisions will control. The term “you” and “your”
refer to the Grantee named in this Agreement. Capitalized terms that are not defined herein shall
have the meanings ascribed to such terms in the Plan.

     The Performance Units that are hereby awarded to you shall be subject to the prohibitions and
restrictions set forth herein with respect to the sale or other disposition of such Performance
Units and the obligation to forfeit and surrender such Performance Units.

     The Performance Units and your rights under this Agreement may not be sold, assigned, pledged,
exchanged, hypothecated or otherwise transferred, encumbered or disposed of (other than by will or
the applicable laws of descent and distribution). Any such attempted sale, assignment, pledge,
exchange, hypothecation, transfer, encumbrance or disposition in violation of this Agreement shall
be void and the Company Group shall not be bound thereby.

     In accepting the award of Performance Units set forth in this Agreement you accept and agree
to be bound by all the terms and conditions of the Plan, and this Agreement.

	 	 	 	 	 	 	 
	 	 	CARRIAGE SERVICES, INC.	 	 
	 
	 	 	 	 	 	 
	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 

Tables to follow:

7

 

PERFORMANCE GOALS

FOR PERFORMANCE UNIT AWARDS GRANTED IN 2007 UNDER

THE CARRIAGE SERVICES, INC. 2006 LONG-TERM INCENTIVE PLAN

     Peer Group 1 Earned Award Factor

     For Performance Units granted by the Company under the Plan, the Peer Group 1 Earned Award
Factor shall be the factor specified in the table below; provided, however, that if the Company’s
Total Shareholder Return for the Performance Period is zero or less than zero the Peer Group 1
Earned Award Factor for the Performance Period shall be zero.

	 	 	 
	Percentile Rank of the Company’s Total Shareholder Return for	 	 
	the Performance Period as Compared to the Total Shareholder	 	Peer Group 1

	Returns of the Other Members of Performance Peer Group 1 for
the Performance Period. 	 	Earned Award

Factor
	
Less than 50th
	 	0.0%
	50th
	 	50.0%
	51st
	 	55.0%
	52nd
	 	60.0%
	53rd
	 	65.0%
	54th
	 	70.0%
	55th
	 	75.0%
	56th
	 	80.0%
	57th
	 	85.0%
	58th
	 	90.0%
	59th
	 	95.0%
	60th
	 	100.0%
	61st
	 	102.5%
	62nd
	 	105.0%
	63rd
	 	107.5%
	64th
	 	110.0%
	65th
	 	112.5%
	66th
	 	115.0%
	67th
	 	117.5%
	68th
	 	120.0%
	69th
	 	122.5%
	70th
	 	125.0%
	71st
	 	127.5%
	72nd
	 	130.0%
	73rd
	 	132.5%
	74th
	 	135.0%
	75th
	 	137.5%
	76th
	 	140.0%
	77th
	 	142.5%
	78th
	 	145.0%
	79th
	 	147.5%
	80th and above
	 	150.0%

8

 

     The Committee shall have the discretion to calculate Total Shareholder Returns for the Company
and each company included in Performance Peer Group 1 and to determine the formula to achieve such
calculations.

     1. Peer Group 2 Earned Award Factor

     For Performance Units granted by the Company under the Plan, if the common stock of both of
the members of Performance Peer Group 2 Earned Award Factor shall be the factor specified in the
table below; provided, however, that (a) if the Company’s Total Shareholder Return for the
Performance Period is zero or less than zero then the Peer Group 2 Earned Award Factor for the
Performance Period shall be zero and (b) if the common stock of either or both of the members of
Performance Peer Group 2 is not publicly traded on the last day of the Performance Period then the
Peer Group 2 Earned Award Factor shall be the amount of the Peer Group 1 Earned Award Factor for
such Performance Period.

	 	 	 
	Rank of the Company’s Total Shareholder Return for the	 	 
	Performance Period as Compared to the Total Shareholder	 	Peer Group 2
	Returns of the Other Members of the Performance Peer	 	Earned Award
	Group 2 for the Performance Period	 	Factor
	First
	 	150.0%
	Second
	 	100.0%
	Less than Second
	 	    0.0%

     The Committee shall have the discretion to calculate Total Shareholder Returns for the Company
and each company included in Performance Peer Group 2 and to determine the formula to achieve such
calculations.

9

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