Document:

Exhibit 10.4

               NONCOMPETITION, SEVERANCE AND EMPLOYMENT AGREEMENT

      This Noncompetition, Severance and Employment Agreement (this "Agreement")
is made and entered into as of this 13th day of December 2000, by and between
David E. Long, an individual (the "Executive"), and Nexity Financial
Corporation, a Delaware corporation and financial institution holding company
headquartered in Birmingham, Alabama (the "Company"). As used herein, the term
"Company" shall include the Company and any and all of its subsidiaries where
the context so applies.

                                   WITNESSETH

      WHEREAS the Company's Board of Directors (the "Board") believes that the
Executive has been instrumental in the success of the Company since its
inception in 1999;

      WHEREAS the Company desires to continue to employ the Executive as
President of the Company and in such other capacities as the Executive is
currently employed as of the date hereof;

      WHEREAS the terms hereof are consistent with the executive compensation
objectives of the Company as established by the Board;

      WHEREAS the Executive is willing to accept the employment contemplated
herein under the terms and conditions set forth herein;

      NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements contained herein and other good and valuable consideration, the
receipt of which is hereby acknowledged, the parties hereto agree as follows:

      1. Employment. Subject to the terms and conditions hereof, the Company
hereby employs the Executive and Executive hereby accepts such employment as the
President of the Company having such duties and responsibilities as are set
forth in Section 3 below.

      2. Definitions. For purposes of this Agreement, the following terms shall
have the meanings specified below.

      "Change in Control" shall mean:

            (i)   The acquisition, directly or indirectly, by any Person [other
                  than (A) any employee plan established by the Company, (B) the
                  Company or any of its affiliates (as defined in Rule 12b-2
                  promulgated under the Exchange Act), (C) an underwriter
                  temporarily holding securities pursuant to an offering of such
                  securities, or (D) a corporation owned, directly or
                  indirectly, by stockholders of the Company in substantially
                  the same proportions as their ownership of the Company], of
                  securities of the Company (not including in the securities
                  beneficially owned by such Person any securities acquired
                  directly from the Company) representing an aggregate of 20% or
                  more of the combined voting power of the Company's then
                  outstanding voting securities;

            (ii)  During any period of up to two consecutive years, individuals
                  who, at the beginning of such period, constitute the Board
                  cease for any reason to constitute at least a majority
                  thereof, provided that any person who becomes a director
                  subsequent to the beginning of such period and whose
                  nomination for election is approved by at least two-thirds of
                  the directors then still in office who either were directors
                  at the beginning of such period or whose election or
                  nomination for

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                  election was previously so approved (other than a director (A)
                  whose initial assumption of office is in connection with an
                  actual or threatened election contest relating to the election
                  of the directors of the Company, as such terms are used in
                  Rule 14a-11 of Regulation 14A under the Exchange Act, or (B)
                  who was designated by a Person who has entered into an
                  agreement with the Company to effect a transaction described
                  in clause (i), (iii) or (iv) of this definition) shall be
                  deemed a director as of the beginning of such period;

            (iii) (A) The stockholders of the Company approve a merger or
                  consolidation of the Company with any other corporation other
                  than (1) a merger or consolidation that would result in the
                  voting securities of the Company outstanding immediately prior
                  thereto continuing to represent (either by remaining
                  outstanding or by being converted into voting securities of
                  the surviving entity or any parent thereof), in combination
                  with the ownership of any trustee or other fiduciary holding
                  securities under an employee benefit plan of the Company, at
                  least 51% of the combined voting power of the voting
                  securities of the Company or such surviving entity or any
                  parent thereof outstanding immediately after such merger or
                  consolidation, or (2) a merger or consolidation effected to
                  implement a recapitalization of the Company (or similar
                  transaction) in which no Person is or becomes the beneficial
                  owner (as defined in clause (i) above), directly or
                  indirectly, of securities of the Company (not including in the
                  securities beneficially owned by such Person any securities
                  acquired directly from the Company) representing 20% or more
                  of the combined voting power of the Company's then outstanding
                  voting securities; or (B) A plan of complete liquidation of
                  the Company or an agreement for the sale or disposition by the
                  Company of all or substantially all of the Company's assets;
                  or

            (iv)  The occurrence of any other event or circumstance which is not
                  covered by (i) through (iii) above which the Board determines
                  affects control of the Company and, in order to implement the
                  purposes of this Agreement as set forth above, adopts a
                  resolution that such event or circumstance constitutes a
                  Change in Control for the purposes of this Agreement.

      "Cause" shall mean (a) fraud; (b) embezzlement; (c) conviction of the
Executive of any felony; (d) a material breach of, or the willful failure or
refusal by the Executive to perform and discharge the Executive's duties,
responsibilities and obligations under this Agreement; (e) any act of moral
turpitude or willful misconduct by the Executive intended to result in personal
enrichment of the Executive at the expense of the Company, or any of its
affiliates or which has a material adverse impact on the business or reputation
of the Company or any of its affiliates (such determination to be made by the
Board in its reasonable judgment); (f) intentional material damage to the
property or business of the Company; (g) gross negligence; or (h) the
ineligibility of the Executive to perform his duties because of a ruling,
directive or other action by any agency of the United States or any state of the
United States having regulatory authority over the Company; but only if (1) the
Executive has been provided with written notice of any assertion that there is a
basis for termination for cause which notice shall specify in reasonable detail
specific facts regarding any such assertion, (2) such written notice is provided
to the Executive a reasonable time before the Board meets to consider any
possible termination for cause, (3) at or prior to the meeting of the Board to
consider the matters described in the written notice, an opportunity is provided
to the Executive and his counsel to be heard before the Board with respect to
the matters described in the written notice, (4) any resolution or other Board
action held with respect to any deliberation regarding or decision

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to terminate the Executive for cause is duly adopted by a vote of a majority of
the entire Board of the Company at a meeting of the Board called and held and
(5) the Executive is promptly provided with a copy of the resolution or other
corporate action taken with respect to such termination. No act or failure to
act by the Executive shall be considered willful unless done or omitted to be
done by him not in good faith and without reasonable belief that his action or
omission was in the best interests of the Company. The unwillingness of the
Executive to accept any or all of a material change in the nature or scope of
his position, authorities or duties, a reduction in his total compensation or
benefits, a relocation that he deems unreasonable in light of his personal
circumstances, or other action by or request of the Company in respect of his
position, authority, or responsibility that he reasonably deems to be contrary
to this Agreement, may not be considered by the Board to be a failure to perform
or misconduct by the Executive.

      "Code" shall mean the Internal Revenue Code of 1986, as amended, or any
successor statute, rule or regulation of similar effect.

      "Confidential Information" shall mean all business and other information
relating to the business of the Company, including without limitation, technical
or nontechnical data, programs, methods, techniques, processes, financial data,
financial plans, product plans, and lists of actual or potential customers,
which (i) derives economic value, actual or potential, from not being generally
known to, and not being readily ascertainable by proper means by, other Persons,
and (ii) is the subject of efforts that are reasonable under the circumstances
to maintain its secrecy or confidentiality. Such information and compilations of
information shall be contractually subject to protection under this Agreement
whether or not such information constitutes a trade secret and is separately
protectable at law or in equity as a trade secret. Confidential Information does
not include confidential business information which does not constitute a trade
secret under applicable law two years after any expiration or termination of
this Agreement.

      "Disability" or "Disabled" shall mean the Executive's inability as a
result of physical or mental incapacity to substantially perform his duties for
the Company on a full-time basis, with or without accommodation, for a period of
six (6) months.

      "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.

      "Involuntary Termination" shall mean the termination of Executive's
employment by the Executive following a Change in Control which, in the sole
judgment of the Executive, is due to (i) a change of the Executive's
responsibilities, position (including status as President of the Company, its
successor or ultimate parent entity, office, title, reporting relationships or
working conditions) authority or duties (including changes resulting from the
assignment to the Executive of any duties inconsistent with his positions,
duties or responsibilities as in effect immediately prior to the Change in
Control); or (ii) a change in the terms or status (including the rolling three
year termination date) of this Agreement; or (iii) a reduction in the
Executive's compensation or benefits; or (iv) a forced relocation of the
Executive outside the Birmingham, Alabama metropolitan area; or (v) a
significant increase in the Executive's travel requirements.

      "Person" shall mean any individual, corporation, bank, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization or
other entity.

      "Voluntary Termination" shall mean the termination by Executive of
Executive's employment following a Change in Control which is not the result of
any of clauses (i) through (v) set forth in the definition of Involuntary
Termination above.

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      3. Duties. During the term hereof, the Executive shall have such duties
and authority as are typical of the President of a company such as the Company,
including, without limitation, those specified in the Company's Bylaws.
Executive agrees that during the Term hereof, he will devote his full time,
attention and energies to the diligent performance of his duties. Nothing
contained in this Agreement is intended to prohibit Executive from expending a
reasonable amount of time managing his personal investments and discharging his
civic responsibilities as long as such activities do not materially interfere
with Executive's duties and obligations under this Agreement. Executive shall
not, without the prior written consent of the Company, at any time during the
Term hereof (i) accept employment with, or render services of a business,
professional or commercial nature to, any Person other than the Company, (ii)
engage in any venture or activity which the Company may in good faith consider
to be competitive with or adverse to the business of the Company or of any
affiliate of the Company, whether alone, as a partner, or as an officer,
director, employee or shareholder or otherwise, except that the ownership of not
more than 5% of the stock or other equity interest of any publicly traded
corporation or other entity shall not be deemed a violation of this Section, or
(iii) engage in any venture or activity which the Board may in good faith
consider to interfere with Executive's performance of his duties hereunder.

      4. Term. Unless earlier terminated as provided herein, the Executive's
employment hereunder shall be for a rolling term of three years (the "Term")
commencing on the date hereof. This Agreement shall be deemed to extend each day
for an additional day automatically and without any action on behalf of either
party hereto until Executive turns sixty; upon Executive's sixtieth birthday,
such "Term" shall be converted to a fixed term of three years and shall expire
(without any action on behalf of either party hereto) on Executive's sixty-third
birthday; this Agreement shall terminate upon the expiration of such Term.
Either party may, by notice to the other, cause this Agreement to cease to
extend automatically and, upon such notice, the "Term" of this Agreement shall
be the three years following the date of such notice, and this Agreement shall
terminate upon the expiration of such Term.

      5. Termination. This Agreement may be terminated as follows:

            5.1   The Company. The Company shall have the right to terminate
                  Executive's employment hereunder at any time during the Term
                  hereof (i) for Cause, (ii) if the Executive becomes Disabled,
                  (iii) upon the Executive's death, or (iv) without Cause.

            5.1.1 If the Company terminates Executive's employment under this
                  Agreement for Cause pursuant to clause (i) of Section 5.1, the
                  Company's obligations under this Agreement, including any
                  obligations of the Company under Section 5.2 hereof, shall
                  cease as of the date of termination; provided, however, if
                  Executive is terminated for Cause after a Change in Control,
                  then such termination shall be treated as a Voluntary
                  Termination as contemplated in Section 5.2.3 below.

            5.1.2 If the Company terminates Executive's employment under this
                  Agreement pursuant to clauses (ii) or (iii) of Section 5.1,
                  the Company's obligations hereunder, including the obligations
                  under Sections 6.1 and 6.4 hereof, shall only cease 180 days
                  after the event giving rise to such termination. The
                  termination shall be deemed to occur on the date of death or
                  Disability, as appropriate.

            5.1.3 If the Company terminates Executive without Cause pursuant to
                  clause (iv) of Section 5.1, Executive shall be entitled to
                  receive immediately as severance upon such termination, less
                  applicable taxes and other deductions, a lump sum equal to

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                  the aggregate cash compensation provided in Sections 6.1 and
                  6.2 equal to 1.5 times Executive's annual compensation being
                  paid at the time of termination plus the benefits provided in
                  Section 6.4 for 18 months. For purposes of determining
                  compensation which is not fixed (such as a bonus), the annual
                  amount of such unfixed compensation shall be deemed to be
                  equal to the average of such compensation over the three year
                  period immediately prior to the termination.

            5.1.4 In the event of termination without Cause pursuant to clause
                  (iv) of Section 5.1, (A) all rights of Executive pursuant to
                  awards of share grants or options granted by the Company shall
                  be deemed to have vested and shall be released from all
                  conditions and restrictions, except for restrictions on
                  transfer pursuant to the Securities Act of 1933, as amended,
                  (B) the Executive shall be deemed to be credited with service
                  with the Company for such remaining Term for the purposes of
                  the Company's benefit plans, (C) the Executive shall be deemed
                  to have retired from the Company and shall be entitled as of
                  the termination date, or at such later time as he may elect to
                  commence receiving the total combined qualified and
                  non-qualified retirement benefit to which he is entitled
                  hereunder, or his total non-qualified retirement benefit
                  hereunder if under the terms of the Company's qualified
                  retirement plan for salaried employees he is not entitled to a
                  qualified benefit, and (D) if any provision of this Section
                  5.1.4 cannot, in whole or in part, be implemented and carried
                  out under the terms of the applicable compensation, benefit,
                  or other plan or arrangement of the Company because the
                  Executive has ceased to be an actual employee of the Company,
                  because the Executive has insufficient or reduced credited
                  service based upon his actual employment by the Company,
                  because the plan or arrangement has been terminated or amended
                  after the effective date of this Agreement, or because of any
                  other reason, the Company itself shall pay or otherwise
                  provide the equivalent of such rights, benefits and credits
                  for such benefits to Executive, his dependents, beneficiaries
                  and estate.

            5.2   By Executive. Except when Executive's employment is terminated
                  for Cause prior to a Change in Control or for death or
                  Disability, under Section 5.1(i), (ii) or (iii), Executive
                  shall have the right to terminate his employment hereunder if
                  (i) the Executive at any time gives written notice of
                  termination (for any reason) to the Company; (ii) there is a
                  Voluntary Termination; (iii) there is an Involuntary
                  Termination, or (iv) the Company materially breaches this
                  Agreement and such breach is not cured within 30 days after
                  written notice of such breach is given by the Executive to the
                  Company.

            5.2.1 If Executive terminates his employment hereunder pursuant to
                  clauses (i) or (ii) of Section 5.2, Executive shall be
                  entitled to receive immediately as severance upon such
                  termination, less applicable taxes and other deductions, a
                  lump sum equal to the aggregate cash compensation provided in
                  Sections 6.1 and 6.2 equal to 1.5 times Executive's annual
                  compensation being paid at the time of termination, plus the
                  benefits provided in Section 6.4 for 18 months. For purposes
                  of determining compensation which is not fixed (such as a
                  bonus), the annual amount of such unfixed compensation shall
                  be deemed to be the equal to the average of such compensation
                  over the three year period immediately prior to the
                  termination.

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            5.2.2 If Executive terminates his employment hereunder pursuant to
                  clauses (iii) or (iv) of Section 5.2, Executive shall be
                  entitled to receive immediately as severance upon such
                  termination, less applicable taxes and other deductions, a
                  lump sum equal to the aggregate cash compensation provided in
                  Sections 6.1 and 6.2 equal to 3 times Executive's annual
                  compensation being paid at the time of termination plus the
                  benefits provided in Section 6.4 for 36 months. For purposes
                  of determining compensation which is not fixed (such as a
                  bonus), the annual amount of such unfixed compensation shall
                  be deemed to be the equal to the average of such compensation
                  over the three year period immediately prior to the
                  termination.

            5.2.3 In addition, in the event of termination pursuant to any of
                  clauses (i) through (iv) of this Section 5.2, (A) all rights
                  of Executive pursuant to awards of share grants or options
                  granted by the Company shall be deemed to have vested and
                  shall be released from all conditions and restrictions, except
                  for restrictions on transfer pursuant to the Securities Act of
                  1933, as amended, (B) the Executive shall be deemed to be
                  credited with service with the Company for such remaining Term
                  for the purposes of the Company's benefit plans, (C) the
                  Executive shall be deemed to have retired from the Company and
                  shall be entitled as of the termination date, or at such later
                  time as he may elect to commence receiving the total combined
                  qualified and non-qualified retirement benefit to which he is
                  entitled hereunder, or his total non-qualified retirement
                  benefit hereunder if under the terms of the Company's
                  qualified retirement plan for salaried employees he is not
                  entitled to a qualified benefit, and (D) if any provision of
                  this Section 5.2.3 cannot, in whole or in part, be implemented
                  and carried out under the terms of the applicable
                  compensation, benefit, or other plan or arrangement of the
                  Company because the Executive has ceased to be an actual
                  employee of the Company, because the Executive has
                  insufficient or reduced credited service based upon his actual
                  employment by the Company, because the plan or arrangement has
                  been terminated or amended after the effective date of this
                  Agreement, or because of any other reason, the Company itself
                  shall pay or otherwise provide the equivalent of such rights,
                  benefits and credits for such benefits to Executive, his
                  dependents, beneficiaries and estate.

      6. Compensation. In consideration of Executive's services and covenants
hereunder, Company shall pay to Executive the compensation and benefits
described below (which compensation shall be paid in accordance with the normal
compensation practices of the Company and shall be subject to such deductions
and withholdings as are required by law or policies of the Company in effect
from time to time, provided that his salary pursuant to Section 6.1 shall be
payable not less frequently than monthly):

            6.1   Annual Salary. During the Term hereof, the Company shall pay
                  to Executive a base salary established by the Chief Executive
                  Officer which for the first year of the Term shall be not less
                  than the salary of the Executive for any of the past three
                  years. Executive's salary will be reviewed by the Chief
                  Executive Officer each fiscal year and, in the sole discretion
                  of the Chief Executive Officer, may be increased for such
                  year; provided, however, that following a Change in Control,
                  the base salary shall be increased annually by a percentage at
                  least equal to the average annual increase over the past three
                  years.

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            6.2   Annual Incentive Bonus. During the Term hereof, the Chief
                  Executive Officer may approve payment by the Company to
                  Executive an annual incentive cash bonus determined by the
                  Chief Executive Officer.

            6.3   Stock Options and Restricted Stock. During the Term hereof,
                  the Board shall grant Executive options to purchase Company
                  Common Stock in accordance with the terms of the Company's
                  Incentive Stock Compensation Plan.

            6.4   Other Benefits. Executive shall be entitled to share in any
                  other employee benefits generally provided by the Company to
                  its most highly ranking executives for so long as the Company
                  provides such benefits. The Company also agrees to provide
                  Executive with a Company-paid automobile, reasonable club dues
                  for one country club and a $500,000 whole life insurance
                  policy and such disability insurance as is in force on the
                  date of this Agreement. Executive shall also be entitled to
                  participate in all other benefits accorded general Company
                  employees.

      7. Excess Parachute Payments.

            7.1   It is the intention of the parties hereto that the severance
                  payments and other compensation provided for herein (other
                  than payments pursuant to Section 9) are reasonable
                  compensation for Executive's services to the Company and shall
                  not constitute "excess parachute payments" within the meaning
                  of Section 280G of the Code and any regulations hereunder. In
                  the event that the Company's independent accountants acting as
                  auditors for the Company on the date of a Change in Control
                  determine that the payments provided for herein constitute
                  "excess parachute payments," then the compensation payable
                  hereunder shall be reduced to the point that such compensation
                  shall not qualify as "excess parachute payments."

            7.2   To the extent that payments under Section 9 cause a "parachute
                  payment," as defined in Section 280G(b)(2) of the Code, the
                  Company shall indemnify Executive and hold him harmless
                  against all claims, losses, damages, penalties, expenses, and
                  excise taxes relating thereto. To effect this indemnification,
                  the Company shall pay Executive an additional amount that is
                  sufficient to pay any excise tax imposed by Section 4999 of
                  the Code on the payments and benefits to which Executive is
                  entitled without the additional amount plus any penalties or
                  interest imposed by the Internal Revenue Service in regard to
                  such amounts, plus another additional amount sufficient to pay
                  all the excise and income taxes on the additional amounts. The
                  determination of any additional amount that must be paid under
                  this section at any time shall be made in good faith by the
                  independent auditors then employed by the Company.

      8. Confidentiality. Executive shall hold in a fiduciary capacity for the
benefit of the Company all Confidential Information relating to the Company or
any of its affiliated companies, and their respective businesses, which shall
have been obtained by the Executive during the Executive's employment by the
Company or any of its affiliated companies. After termination of Executive's
employment with the Company, the Executive shall not, without the prior written
consent of the Company or as may otherwise be required by law or legal process,
communicate or divulge any such information, knowledge or data to anyone other
than the Company and those designated by it. Upon the termination or expiration
of his

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employment hereunder, Executive agrees to deliver promptly to the Company all
Company files, customer lists, management reports, memoranda, research, Company
forms, financial data and reports and other documents supplied to or created by
him in connection with his employment hereunder (including all copies of the
foregoing) in his possession or control and all of the Company's equipment and
other materials in his possession or control. In no event shall an asserted
violation of the provisions of this Section 10 constitute a basis for deferring
or withholding any amounts otherwise payable to the Executive under this
Agreement.

      9. Noncompetition and Nonsolicitation Agreement. If this Agreement is
terminated by the Company for Cause pursuant to Section 5.1(i) or by Executive
for any reason other than pursuant to clauses (iii) or (iv) of Section 5.2,
Executive shall not enter into an employment relationship or a consulting
arrangement with any other bank, thrift, lending or financial institution which
has as its primary business strategy Internet banking (hereinafter a
"competitor") within one year of the anniversary of the date of such termination
(the "Noncompete Period"). The obligations contained in this Section 9 shall not
prohibit Executive from being an owner of not more than 5% of the outstanding
stock of any class of a corporation, which is publicly traded, so long as
Executive has no active participation in the business of such corporation.

            9.1   During the Noncompete Period, Executive shall not directly or
                  indirectly through another entity (i) induce or attempt to
                  induce any employee of Company to leave the employ of Company,
                  including but not limited to a competitor, or in any way
                  interfere with the relationship between Company and any
                  employee thereof, (ii) hire any person who was an employee of
                  Company or any subsidiary at any time during the time that
                  Executive was employed by Company, or (iii) induce or attempt
                  to induce any customer, supplier, or other entity in a
                  business relation of Company to cease doing business with the
                  Company, or in any way interfere with the relationship between
                  any such customer, supplier, or business relation and the
                  Company or do business with a competitor.

            9.2   The severance payments and benefits to which Executive is
                  entitled under this Agreement shall be deemed adequate
                  consideration for Executive's obligations under Sections 8 and
                  9 hereof.

            9.3   If, at the time of enforcement of this Section 9, a court
                  shall hold that the duration, scope or area restrictions
                  stated herein are unreasonable under circumstances then
                  existing, the parties agree that the maximum duration, scope
                  or area reasonable under such circumstances shall be
                  substituted for the stated duration, scope or area and that
                  the court shall be allowed to revise the restrictions
                  contained herein to cover the maximum period, scope and area
                  permitted by law. Executive agrees that the restrictions
                  contained in this Section 9 are reasonable.

            9.4   In the event of the breach or a threatened breach by Executive
                  of any of the provisions of this Section 9, the Company, in
                  addition and supplementary to other rights and remedies
                  existing in its favor, may apply to any court of law or equity
                  of competent jurisdiction for specific performance and/or
                  injunctive or other relief in order to enforce or prevent any
                  violations of the provisions hereof (without posting a bond or
                  other security). In addition, in the event of an alleged
                  breach or violation by Executive of this Section 9, the
                  Noncompete Period shall be tolled until such breach or
                  violation has been duly cured.

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      10. Superceded Agreements. This Agreement supercedes and replaces any
previous Agreement between the Executive and the Company regarding employment of
Executive.

      11. Assignment. The parties acknowledge that this Agreement has been
entered into due to, among other things, the special skills of Executive, and
agree that this Agreement may not be assigned or transferred by Executive, in
whole or in part, without the prior written consent of the Company.

      12. Notices. All notices, requests, demands, and other communications
required or permitted hereunder shall be in writing and shall be deemed to have
been duly given if delivered or seven days after mailing if mailed, first class,
certified mail postage prepaid:

      To the Company:              Nexity Financial Corporation
                                   3500 Blue Lake Drive
                                   Suite 330
                                   Birmingham, Alabama 35243
                                   Attn: Chairman of the Board

      To Executive:                David E. Long

                                   _______________________________
                                   _______________________________

      Any party may change the address to which notices, requests, demands, and
other communications shall be delivered or mailed by giving notice thereof to
the other party in the same manner provided herein.

      13. Provisions Severable. If any provision or covenant, or any part
thereof, of this Agreement should be held by any court to be invalid, illegal or
unenforceable, either in whole or in part, such invalidity, illegality or
unenforceability shall not affect the validity, legality or enforceability of
the remaining provisions or covenants, or any part thereof, of this Agreement,
all of which shall remain in full force and effect.

      14. Remedies in the Absence of a Change in Control. The terms of this
Section 14 will apply in the absence of a Change in Control.

                        14.1 The Executive acknowledges that if he breaches or
                  threatens to breach his covenants and agreements in this
                  Agreement, such actions may cause irreparable harm and damage
                  to the Company which could not be compensated in damages.
                  Accordingly, if Executive breaches or threatens to breach this
                  Agreement, the Company shall be entitled to injunctive relief,
                  in addition to any other rights or remedies of the Company.

                        14.2 All claims, disputes and other matters in question
                  between the Executive and the Company arising out of or
                  related to the interpretation of this Agreement or the breach
                  of this Agreement, except as specifically governed by the
                  foregoing provisions where there may be irreparable harm and
                  damage to the Company which could not be compensated in
                  damages, shall be decided by arbitration in accordance with
                  the rules of the American Arbitration Association. This
                  agreement to arbitrate shall be specifically enforceable under
                  applicable law in any court having jurisdiction.

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                  The award rendered by the arbitrator shall be final and
                  judgment may be entered upon it in accordance with the
                  applicable law of any court having jurisdiction thereof.

                        14.3 In the event that the Executive is reasonably
                  required to engage legal counsel to enforce his rights
                  hereunder against the Company, Executive shall be entitled to
                  receive from the Company his reasonable attorneys' fees and
                  costs; provided that Executive shall not be entitled to
                  receive those fees and costs related to matters, if any, which
                  were the subject of litigation and with respect to which a
                  judgment is rendered against Executive.

      15. Remedies in the Event of a Change in Control. The terms of this
Section 15 shall apply in the event of a Change of Control.

            15.1  The Executive acknowledges that if he breaches or threatens to
                  breach his covenants and agreements in this Agreement, such
                  actions may cause irreparable harm and damage to the Company
                  which could not be compensated in damages. Accordingly, if
                  Executive breaches or threatens to breach this Agreement, the
                  Company shall be entitled to injunctive relief, in addition to
                  any other rights or remedies of the Company. All claims,
                  disputes and other matters in question between the Executive
                  and the Company arising out of or related to the
                  interpretation of this Agreement or the breach of this
                  Agreement shall be decided under and governed by the laws of
                  the State of Alabama.

            15.2  The Company is aware that upon the occurrence of a Change in
                  Control, the Board or a stockholder of the Company may then
                  cause or attempt to cause the Company to refuse to comply with
                  its obligations under this Agreement, or may cause or attempt
                  to cause the Company to institute, or may institute,
                  litigation seeking to have this Agreement declared
                  unenforceable, or may take, or attempt to take, other action
                  to deny the Executive the benefits intended under this
                  Agreement. In these circumstances, the purpose of this
                  Agreement could be frustrated. It is the intent of the parties
                  that the Executive not be required to incur the legal fees and
                  expenses associated with the protection or enforcement of his
                  rights under this Agreement by litigation or other legal
                  action because such costs would substantially detract from the
                  benefits intended to be extended to the Executive hereunder,
                  nor be bound to negotiate any settlement of his rights
                  hereunder under threat of incurring such costs. Accordingly,
                  if at any time after a Change of Control, it should appear to
                  the Executive that the Company is or has acted contrary to or
                  is failing or has failed to comply with any of its obligations
                  under this Agreement for the reason that it regards this
                  Agreement to be void or unenforceable or for any other reason,
                  or that the Company has purported to terminate his employment
                  for cause or is in the course of doing so in either case
                  contrary to this Agreement, or in the event that the Company
                  or any other person takes any action to declare this Agreement
                  void or unenforceable, or institutes any litigation or other
                  legal action designed to deny, diminish or to recover from the
                  Executive the benefits provided or intended to be provided to
                  him hereunder, and the Executive has acted in good faith to
                  perform his obligations under this Agreement, the Company
                  irrevocably authorizes the Executive from time to time to
                  retain counsel of his choice at the expense of the Company to
                  represent him in connection with the protection and
                  enforcement of his rights hereunder, including without
                  limitation representation

                                       10
<PAGE>

                  in connection with termination of his employment contrary to
                  this Agreement or with the initiation or defense of any
                  litigation or other legal action, whether by or against the
                  Executive or the Company or any director, officer, stockholder
                  or other person affiliated with the Company, in any
                  jurisdiction. The reasonable fees and expenses of counsel
                  selected from time to time by the Executive as hereinabove
                  provided shall be paid or reimbursed to the Executive by the
                  Company on a regular, periodic basis upon presentation by the
                  Executive of a statement or statements prepared by such
                  counsel representing other officers or key executives of the
                  Company in connection with the protection and enforcement of
                  their rights under similar agreements between them and the
                  Company, and, unless in his sole judgment use of common
                  counsel could be prejudicial to him or would not be likely to
                  reduce the fees and expenses chargeable hereunder to the
                  Company, the Executive agrees to use his best efforts to agree
                  with such other officers or executives to retain common
                  counsel.

      16. Waiver. Failure of either party to insist, in one or more instances,
on performance by the other in strict accordance with the terms and conditions
of this Agreement shall not be deemed a waiver or relinquishment of any right
granted in this Agreement or of the future performance of any such term or
condition or of any other term or condition of this Agreement, unless such
waiver is contained in a writing signed by the party making the waiver.

      17. Amendments and Modifications. This Agreement may be amended or
modified only by a writing signed by other parties hereto.

      18. Governing Law. The validity and effect of this agreement shall be
governed by and construed and enforced in accordance with the laws of the State
of Alabama.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year first above written.

EXECUTIVE

/s/ David E. Long
---------------------------
David E. Long

NEXITY FINANCIAL CORPORATION

/s/ Greg L. Lee
---------------------------
By: Greg L. Lee
    Chairman of the Board and
    Chief Executive Officer

                                       11Exhibit 10.5

               NONCOMPETITION, SEVERANCE AND EMPLOYMENT AGREEMENT

      This Noncompetition, Severance and Employment Agreement (this "Agreement")
is made and entered into as of this _____ day of __________________, by and
between John J. Moran, an individual (the "Executive"), and Nexity Financial
Corporation, a Delaware corporation and financial institution holding company
headquartered in Birmingham, Alabama (the "Company"). As used herein, the term
"Company" shall include the Company and any and all of its subsidiaries where
the context so applies.

                                   WITNESSETH

      WHEREAS the Company's Board of Directors (the "Board") believes that the
Executive has been instrumental in the success of the Company since its
inception in 1999;

      WHEREAS the Company desires to continue to employ the Executive as the
Chief Financial Officer of the Company and in such other capacities as the
Executive is currently employed as of the date hereof;

      WHEREAS the terms hereof are consistent with the executive compensation
objectives of the Company as established by the Board;

      WHEREAS the Executive is willing to accept the employment contemplated
herein under the terms and conditions set forth herein;

      NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements contained herein and other good and valuable consideration, the
receipt of which is hereby acknowledged, the parties hereto agree as follows:

      1. Employment. Subject to the terms and conditions hereof, the Company
hereby employs the Executive and Executive hereby accepts such employment as the
Chief Financial Officer of the Company having such duties and responsibilities
as are set forth in Section 3 below.

      2. Definitions. For purposes of this Agreement, the following terms shall
have the meanings specified below.

      "Change in Control" shall mean:

            (i)   The acquisition, directly or indirectly, by any Person [other
                  than (A) any employee plan established by the Company, (B) the
                  Company or any of its affiliates (as defined in Rule 12b-2
                  promulgated under the Exchange Act), (C) an underwriter
                  temporarily holding securities pursuant to an offering of such
                  securities, or (D) a corporation owned, directly or
                  indirectly, by stockholders of the Company in substantially
                  the same proportions as their ownership of the Company], of
                  securities of the Company (not including in the securities
                  beneficially owned by such Person any securities acquired
                  directly from the Company) representing an aggregate of 20% or
                  more of the combined voting power of the Company's then
                  outstanding voting securities;

            (ii)  During any period of up to two consecutive years, individuals
                  who, at the beginning of such period, constitute the Board
                  cease for any reason to constitute at least a majority
                  thereof, provided that any person who becomes a director
                  subsequent to the beginning of such period and whose
                  nomination for election is approved by at least two-thirds of
                  the directors then still in office who either were directors
                  at the beginning of such period or whose election or
                  nomination for

<PAGE>

                  election was previously so approved (other than a director (A)
                  whose initial assumption of office is in connection with an
                  actual or threatened election contest relating to the election
                  of the directors of the Company, as such terms are used in
                  Rule 14a-11 of Regulation 14A under the Exchange Act, or (B)
                  who was designated by a Person who has entered into an
                  agreement with the Company to effect a transaction described
                  in clause (i), (iii) or (iv) of this definition) shall be
                  deemed a director as of the beginning of such period;

            (iii) (A) The stockholders of the Company approve a merger or
                  consolidation of the Company with any other corporation other
                  than (1) a merger or consolidation that would result in the
                  voting securities of the Company outstanding immediately prior
                  thereto continuing to represent (either by remaining
                  outstanding or by being converted into voting securities of
                  the surviving entity or any parent thereof), in combination
                  with the ownership of any trustee or other fiduciary holding
                  securities under an employee benefit plan of the Company, at
                  least 51% of the combined voting power of the voting
                  securities of the Company or such surviving entity or any
                  parent thereof outstanding immediately after such merger or
                  consolidation, or (2) a merger or consolidation effected to
                  implement a recapitalization of the Company (or similar
                  transaction) in which no Person is or becomes the beneficial
                  owner (as defined in clause (i) above), directly or
                  indirectly, of securities of the Company (not including in the
                  securities beneficially owned by such Person any securities
                  acquired directly from the Company) representing 20% or more
                  of the combined voting power of the Company's then outstanding
                  voting securities; or (B) A plan of complete liquidation of
                  the Company or an agreement for the sale or disposition by the
                  Company of all or substantially all of the Company's assets;
                  or

            (iv)  The occurrence of any other event or circumstance which is not
                  covered by (i) through (iii) above which the Board determines
                  affects control of the Company and, in order to implement the
                  purposes of this Agreement as set forth above, adopts a
                  resolution that such event or circumstance constitutes a
                  Change in Control for the purposes of this Agreement.

      "Cause" shall mean (a) fraud; (b) embezzlement; (c) conviction of the
Executive of any felony; (d) a material breach of, or the willful failure or
refusal by the Executive to perform and discharge the Executive's duties,
responsibilities and obligations under this Agreement; (e) any act of moral
turpitude or willful misconduct by the Executive intended to result in personal
enrichment of the Executive at the expense of the Company, or any of its
affiliates or which has a material adverse impact on the business or reputation
of the Company or any of its affiliates (such determination to be made by the
Board in its reasonable judgment); (f) intentional material damage to the
property or business of the Company; (g) gross negligence; or (h) the
ineligibility of the Executive to perform his duties because of a ruling,
directive or other action by any agency of the United States or any state of the
United States having regulatory authority over the Company; but only if (1) the
Executive has been provided with written notice of any assertion that there is a
basis for termination for cause which notice shall specify in reasonable detail
specific facts regarding any such assertion, (2) such written notice is provided
to the Executive a reasonable time before the Board meets to consider any
possible termination for cause, (3) at or prior to the meeting of the Board to
consider the matters described in the written notice, an opportunity is provided
to the Executive and his counsel to be heard before the Board with respect to
the matters described in the written notice, (4) any resolution or other Board
action held with respect to any deliberation regarding or decision

                                       2
<PAGE>

to terminate the Executive for cause is duly adopted by a vote of a majority of
the entire Board of the Company at a meeting of the Board called and held and
(5) the Executive is promptly provided with a copy of the resolution or other
corporate action taken with respect to such termination. No act or failure to
act by the Executive shall be considered willful unless done or omitted to be
done by him not in good faith and without reasonable belief that his action or
omission was in the best interests of the Company. The unwillingness of the
Executive to accept any or all of a material change in the nature or scope of
his position, authorities or duties, a reduction in his total compensation or
benefits, a relocation that he deems unreasonable in light of his personal
circumstances, or other action by or request of the Company in respect of his
position, authority, or responsibility that he reasonably deems to be contrary
to this Agreement, may not be considered by the Board to be a failure to perform
or misconduct by the Executive.

      "Code" shall mean the Internal Revenue Code of 1986, as amended, or any
successor statute, rule or regulation of similar effect.

      "Confidential Information" shall mean all business and other information
relating to the business of the Company, including without limitation, technical
or nontechnical data, programs, methods, techniques, processes, financial data,
financial plans, product plans, and lists of actual or potential customers,
which (i) derives economic value, actual or potential, from not being generally
known to, and not being readily ascertainable by proper means by, other Persons,
and (ii) is the subject of efforts that are reasonable under the circumstances
to maintain its secrecy or confidentiality. Such information and compilations of
information shall be contractually subject to protection under this Agreement
whether or not such information constitutes a trade secret and is separately
protectable at law or in equity as a trade secret. Confidential Information does
not include confidential business information which does not constitute a trade
secret under applicable law two years after any expiration or termination of
this Agreement.

      "Disability" or "Disabled" shall mean the Executive's inability as a
result of physical or mental incapacity to substantially perform his duties for
the Company on a full-time basis, with or without accommodation, for a period of
six (6) months.

      "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.

      "Involuntary Termination" shall mean the termination of Executive's
employment by the Executive following a Change in Control which, in the sole
judgment of the Executive, is due to (i) a change of the Executive's
responsibilities, position (including status as Chief Financial Officer of the
Company, its successor or ultimate parent entity, office, title, reporting
relationships or working conditions) authority or duties (including changes
resulting from the assignment to the Executive of any duties inconsistent with
his positions, duties or responsibilities as in effect immediately prior to the
Change in Control); or (ii) a change in the terms or status (including the
rolling three year termination date) of this Agreement; or (iii) a reduction in
the Executive's compensation or benefits; or (iv) a forced relocation of the
Executive outside the Myrtle Beach, South Carolina metropolitan area; or (v) a
significant increase in the Executive's travel requirements.

      "Person" shall mean any individual, corporation, bank, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization or
other entity.

      "Voluntary Termination" shall mean the termination by Executive of
Executive's employment following a Change in Control which is not the result of
any of clauses (i) through (v) set forth in the definition of Involuntary
Termination above.

                                       3
<PAGE>

      3. Duties. During the term hereof, the Executive shall have such duties
and authority as are typical of the Chief Financial Officer of a company such as
the Company, including, without limitation, those specified in the Company's
Bylaws. Executive agrees that during the Term hereof, he will devote his full
time, attention and energies to the diligent performance of his duties. Nothing
contained in this Agreement is intended to prohibit Executive from expending a
reasonable amount of time managing his personal investments and discharging his
civic responsibilities as long as such activities do not materially interfere
with Executive's duties and obligations under this Agreement. Executive shall
not, without the prior written consent of the Company, at any time during the
Term hereof (i) accept employment with, or render services of a business,
professional or commercial nature to, any Person other than the Company, (ii)
engage in any venture or activity which the Company may in good faith consider
to be competitive with or adverse to the business of the Company or of any
affiliate of the Company, whether alone, as a partner, or as an officer,
director, employee or shareholder or otherwise, except that the ownership of not
more than 5% of the stock or other equity interest of any publicly traded
corporation or other entity shall not be deemed a violation of this Section, or
(iii) engage in any venture or activity which the Board may in good faith
consider to interfere with Executive's performance of his duties hereunder.

      4. Term. Unless earlier terminated as provided herein, the Executive's
employment hereunder shall be for a rolling term of three years (the "Term")
commencing on the date hereof. This Agreement shall be deemed to extend each day
for an additional day automatically and without any action on behalf of either
party hereto until Executive turns sixty; upon Executive's sixtieth birthday,
such "Term" shall be converted to a fixed term of three years and shall expire
(without any action on behalf of either party hereto) on Executive's sixty-third
birthday; this Agreement shall terminate upon the expiration of such Term.
Either party may, by notice to the other, cause this Agreement to cease to
extend automatically and, upon such notice, the "Term" of this Agreement shall
be the three years following the date of such notice, and this Agreement shall
terminate upon the expiration of such Term.

      5. Termination. This Agreement may be terminated as follows:

            5.1   The Company. The Company shall have the right to terminate
                  Executive's employment hereunder at any time during the Term
                  hereof (i) for Cause, (ii) if the Executive becomes Disabled,
                  (iii) upon the Executive's death, or (iv) without Cause.

            5.1.1 If the Company terminates Executive's employment under this
                  Agreement for Cause pursuant to clause (i) of Section 5.1, the
                  Company's obligations under this Agreement, including any
                  obligations of the Company under Section 5.2 hereof, shall
                  cease as of the date of termination; provided, however, if
                  Executive is terminated for Cause after a Change in Control,
                  then such termination shall be treated as a Voluntary
                  Termination as contemplated in Section 5.2.3 below.

            5.1.2 If the Company terminates Executive's employment under this
                  Agreement pursuant to clauses (ii) or (iii) of Section 5.1,
                  the Company's obligations hereunder, including the obligations
                  under Sections 6.1 and 6.4 hereof, shall only cease 180 days
                  after the event giving rise to such termination. The
                  termination shall be deemed to occur on the date of death or
                  Disability, as appropriate.

            5.1.3 If the Company terminates Executive without Cause pursuant to
                  clause (iv) of Section 5.1, Executive shall be entitled to
                  receive immediately as severance upon such termination, less
                  applicable taxes and other deductions, a lump sum equal to

                                       4
<PAGE>

                  the aggregate cash compensation provided in Sections 6.1 and
                  6.2 equal to 1.5 times Executive's annual compensation being
                  paid at the time of termination plus the benefits provided in
                  Section 6.4 for 18 months. For purposes of determining
                  compensation which is not fixed (such as a bonus), the annual
                  amount of such unfixed compensation shall be deemed to be
                  equal to the average of such compensation over the three year
                  period immediately prior to the termination.

            5.1.4 In the event of termination without Cause pursuant to clause
                  (iv) of Section 5.1, (A) all rights of Executive pursuant to
                  awards of share grants or options granted by the Company shall
                  be deemed to have vested and shall be released from all
                  conditions and restrictions, except for restrictions on
                  transfer pursuant to the Securities Act of 1933, as amended,
                  (B) the Executive shall be deemed to be credited with service
                  with the Company for such remaining Term for the purposes of
                  the Company's benefit plans, (C) the Executive shall be deemed
                  to have retired from the Company and shall be entitled as of
                  the termination date, or at such later time as he may elect to
                  commence receiving the total combined qualified and
                  non-qualified retirement benefit to which he is entitled
                  hereunder, or his total non-qualified retirement benefit
                  hereunder if under the terms of the Company's qualified
                  retirement plan for salaried employees he is not entitled to a
                  qualified benefit, and (D) if any provision of this Section
                  5.1.4 cannot, in whole or in part, be implemented and carried
                  out under the terms of the applicable compensation, benefit,
                  or other plan or arrangement of the Company because the
                  Executive has ceased to be an actual employee of the Company,
                  because the Executive has insufficient or reduced credited
                  service based upon his actual employment by the Company,
                  because the plan or arrangement has been terminated or amended
                  after the effective date of this Agreement, or because of any
                  other reason, the Company itself shall pay or otherwise
                  provide the equivalent of such rights, benefits and credits
                  for such benefits to Executive, his dependents, beneficiaries
                  and estate.

            5.2   By Executive. Except when Executive's employment is terminated
                  for Cause prior to a Change in Control or for death or
                  Disability, under Section 5.1(i), (ii) or (iii), Executive
                  shall have the right to terminate his employment hereunder if
                  (i) the Executive at any time gives written notice of
                  termination (for any reason) to the Company; (ii) there is a
                  Voluntary Termination; (iii) there is an Involuntary
                  Termination, or (iv) the Company materially breaches this
                  Agreement and such breach is not cured within 30 days after
                  written notice of such breach is given by the Executive to the
                  Company.

            5.2.1 If Executive terminates his employment hereunder pursuant to
                  clauses (i) or (ii) of Section 5.2, Executive shall be
                  entitled to receive immediately as severance upon such
                  termination, less applicable taxes and other deductions, a
                  lump sum equal to the aggregate cash compensation provided in
                  Sections 6.1 and 6.2 equal to 1.5 times Executive's annual
                  compensation being paid at the time of termination, plus the
                  benefits provided in Section 6.4 for 18 months. For purposes
                  of determining compensation which is not fixed (such as a
                  bonus), the annual amount of such unfixed compensation shall
                  be deemed to be the equal to the average of such compensation
                  over the three year period immediately prior to the
                  termination.

                                       5
<PAGE>

            5.2.2 If Executive terminates his employment hereunder pursuant to
                  clauses (iii) or (iv) of Section 5.2, Executive shall be
                  entitled to receive immediately as severance upon such
                  termination, less applicable taxes and other deductions, a
                  lump sum equal to the aggregate cash compensation provided in
                  Sections 6.1 and 6.2 equal to 3 times Executive's annual
                  compensation being paid at the time of termination plus the
                  benefits provided in Section 6.4 for 36 months. For purposes
                  of determining compensation which is not fixed (such as a
                  bonus), the annual amount of such unfixed compensation shall
                  be deemed to be the equal to the average of such compensation
                  over the three year period immediately prior to the
                  termination.

            5.2.3 In addition, in the event of termination pursuant to any of
                  clauses (i) through (iv) of this Section 5.2, (A) all rights
                  of Executive pursuant to awards of share grants or options
                  granted by the Company shall be deemed to have vested and
                  shall be released from all conditions and restrictions, except
                  for restrictions on transfer pursuant to the Securities Act of
                  1933, as amended, (B) the Executive shall be deemed to be
                  credited with service with the Company for such remaining Term
                  for the purposes of the Company's benefit plans, (C) the
                  Executive shall be deemed to have retired from the Company and
                  shall be entitled as of the termination date, or at such later
                  time as he may elect to commence receiving the total combined
                  qualified and non-qualified retirement benefit to which he is
                  entitled hereunder, or his total non-qualified retirement
                  benefit hereunder if under the terms of the Company's
                  qualified retirement plan for salaried employees he is not
                  entitled to a qualified benefit, and (D) if any provision of
                  this Section 5.2.3 cannot, in whole or in part, be implemented
                  and carried out under the terms of the applicable
                  compensation, benefit, or other plan or arrangement of the
                  Company because the Executive has ceased to be an actual
                  employee of the Company, because the Executive has
                  insufficient or reduced credited service based upon his actual
                  employment by the Company, because the plan or arrangement has
                  been terminated or amended after the effective date of this
                  Agreement, or because of any other reason, the Company itself
                  shall pay or otherwise provide the equivalent of such rights,
                  benefits and credits for such benefits to Executive, his
                  dependents, beneficiaries and estate.

      6. Compensation. In consideration of Executive's services and covenants
hereunder, Company shall pay to Executive the compensation and benefits
described below (which compensation shall be paid in accordance with the normal
compensation practices of the Company and shall be subject to such deductions
and withholdings as are required by law or policies of the Company in effect
from time to time, provided that his salary pursuant to Section 6.1 shall be
payable not less frequently than monthly):

            6.1   Annual Salary. During the Term hereof, the Company shall pay
                  to Executive a base salary established by the Chief Executive
                  Officer which for the first year of the Term shall be not less
                  than the salary of the Executive for any of the past three
                  years. Executive's salary will be reviewed by the Chief
                  Executive Officer each fiscal year and, in the sole discretion
                  of the Chief Executive Officer, may be increased for such
                  year; provided, however, that following a Change in Control,
                  the base salary shall be increased annually by a percentage at
                  least equal to the average annual increase over the past three
                  years.

                                       6
<PAGE>

            6.2   Annual Incentive Bonus. During the Term hereof, the Chief
                  Executive Officer may approve payment by the Company to
                  Executive an annual incentive cash bonus determined by the
                  Chairman of the Board.

            6.3   Stock Options and Restricted Stock. During the Term hereof,
                  the Board shall grant Executive options to purchase Company
                  Common Stock in accordance with the terms of the Company's
                  Incentive Stock Compensation Plan.

            6.3   Other Benefits. Executive shall be entitled to share in any
                  other employee benefits generally provided by the Company to
                  its most highly ranking executives for so long as the Company
                  provides such benefits. The Company also agrees to provide
                  Executive with a Company-paid automobile, reasonable club dues
                  for one country club and a $500,000 whole life insurance
                  policy and such disability insurance as is in force on the
                  date of this Agreement. Executive shall also be entitled to
                  participate in all other benefits accorded general Company
                  employees.

      7. Excess Parachute Payments.

            7.1   It is the intention of the parties hereto that the severance
                  payments and other compensation provided for herein (other
                  than payments pursuant to Section 9) are reasonable
                  compensation for Executive's services to the Company and shall
                  not constitute "excess parachute payments" within the meaning
                  of Section 280G of the Code and any regulations hereunder. In
                  the event that the Company's independent accountants acting as
                  auditors for the Company on the date of a Change in Control
                  determine that the payments provided for herein constitute
                  "excess parachute payments," then the compensation payable
                  hereunder shall be reduced to the point that such compensation
                  shall not qualify as "excess parachute payments."

            7.2   To the extent that payments under Section 9 cause a "parachute
                  payment," as defined in Section 280G(b)(2) of the Code, the
                  Company shall indemnify Executive and hold him harmless
                  against all claims, losses, damages, penalties, expenses, and
                  excise taxes relating thereto. To effect this indemnification,
                  the Company shall pay Executive an additional amount that is
                  sufficient to pay any excise tax imposed by Section 4999 of
                  the Code on the payments and benefits to which Executive is
                  entitled without the additional amount plus any penalties or
                  interest imposed by the Internal Revenue Service in regard to
                  such amounts, plus another additional amount sufficient to pay
                  all the excise and income taxes on the additional amounts. The
                  determination of any additional amount that must be paid under
                  this section at any time shall be made in good faith by the
                  independent auditors then employed by the Company.

      8. Confidentiality. Executive shall hold in a fiduciary capacity for the
benefit of the Company all Confidential Information relating to the Company or
any of its affiliated companies, and their respective businesses, which shall
have been obtained by the Executive during the Executive's employment by the
Company or any of its affiliated companies. After termination of Executive's
employment with the Company, the Executive shall not, without the prior written
consent of the Company or as may otherwise be required by law or legal process,
communicate or divulge any such information, knowledge or data to anyone other
than the Company and those designated by it. Upon the termination or expiration
of his

                                       7
<PAGE>

employment hereunder, Executive agrees to deliver promptly to the Company all
Company files, customer lists, management reports, memoranda, research, Company
forms, financial data and reports and other documents supplied to or created by
him in connection with his employment hereunder (including all copies of the
foregoing) in his possession or control and all of the Company's equipment and
other materials in his possession or control. In no event shall an asserted
violation of the provisions of this Section 10 constitute a basis for deferring
or withholding any amounts otherwise payable to the Executive under this
Agreement.

      9. Noncompetition and Nonsolicitation Agreement. If this Agreement is
terminated by the Company for Cause pursuant to Section 5.1(i) or by Executive
for any reason other than pursuant to clauses (iii) or (iv) of Section 5.2,
Executive shall not enter into an employment relationship or a consulting
arrangement with any other bank, thrift, lending or financial institution which
has as its primary business strategy Internet banking (hereinafter a
"competitor") within one year of the anniversary of the date of such termination
(the "Noncompete Period"). The obligations contained in this Section 9 shall not
prohibit Executive from being an owner of not more than 5% of the outstanding
stock of any class of a corporation, which is publicly traded, so long as
Executive has no active participation in the business of such corporation.

                  9.1 During the Noncompete Period, Executive shall not directly
            or indirectly through another entity (i) induce or attempt to induce
            any employee of Company to leave the employ of Company, including
            but not limited to a competitor, or in any way interfere with the
            relationship between Company and any employee thereof, (ii) hire any
            person who was an employee of Company or any subsidiary at any time
            during the time that Executive was employed by Company, or (iii)
            induce or attempt to induce any customer, supplier, or other entity
            in a business relation of Company to cease doing business with the
            Company, or in any way interfere with the relationship between any
            such customer, supplier, or business relation and the Company or do
            business with a competitor.

                  9.2 The severance payments and benefits to which Executive is
            entitled under this Agreement shall be deemed adequate consideration
            for Executive's obligations under Sections 8 and 9 hereof.

                  9.3 If, at the time of enforcement of this Section 9, a court
            shall hold that the duration, scope or area restrictions stated
            herein are unreasonable under circumstances then existing, the
            parties agree that the maximum duration, scope or area reasonable
            under such circumstances shall be substituted for the stated
            duration, scope or area and that the court shall be allowed to
            revise the restrictions contained herein to cover the maximum
            period, scope and area permitted by law. Executive agrees that the
            restrictions contained in this Section 9 are reasonable.

                  9.4 In the event of the breach or a threatened breach by
            Executive of any of the provisions of this Section 9, the Company,
            in addition and supplementary to other rights and remedies existing
            in its favor, may apply to any court of law or equity of competent
            jurisdiction for specific performance and/or injunctive or other
            relief in order to enforce or prevent any violations of the
            provisions hereof (without posting a bond or other security). In
            addition, in the event of an alleged breach or violation by
            Executive of this Section 9, the Noncompete Period shall be tolled
            until such breach or violation has been duly cured.

                                       8
<PAGE>

      10. Superceded Agreements. This Agreement supercedes and replaces any
previous Agreement between the Executive and the Company regarding employment of
Executive.

      11. Assignment. The parties acknowledge that this Agreement has been
entered into due to, among other things, the special skills of Executive, and
agree that this Agreement may not be assigned or transferred by Executive, in
whole or in part, without the prior written consent of the Company.

      12. Notices. All notices, requests, demands, and other communications
required or permitted hereunder shall be in writing and shall be deemed to have
been duly given if delivered or seven days after mailing if mailed, first class,
certified mail postage prepaid:

      To the Company:            Nexity Financial Corporation
                                 3500 Blue Lake Drive
                                 Suite 330
                                 Birmingham, Alabama 35243
                                 Attn: Chairman of the Board

      To Executive:              John J. Moran

                                 ________________________________
                                 ________________________________

      Any party may change the address to which notices, requests, demands, and
other communications shall be delivered or mailed by giving notice thereof to
the other party in the same manner provided herein.

      13. Provisions Severable. If any provision or covenant, or any part
thereof, of this Agreement should be held by any court to be invalid, illegal or
unenforceable, either in whole or in part, such invalidity, illegality or
unenforceability shall not affect the validity, legality or enforceability of
the remaining provisions or covenants, or any part thereof, of this Agreement,
all of which shall remain in full force and effect.

      14. Remedies in the Absence of a Change in Control. The terms of this
Section 14 will apply in the absence of a Change in Control.

                  14.1 The Executive acknowledges that if he breaches or
            threatens to breach his covenants and agreements in this Agreement,
            such actions may cause irreparable harm and damage to the Company
            which could not be compensated in damages. Accordingly, if Executive
            breaches or threatens to breach this Agreement, the Company shall be
            entitled to injunctive relief, in addition to any other rights or
            remedies of the Company.

                  14.2 All claims, disputes and other matters in question
            between the Executive and the Company arising out of or related to
            the interpretation of this Agreement or the breach of this
            Agreement, except as specifically governed by the foregoing
            provisions where there may be irreparable harm and damage to the
            Company which could not be compensated in damages, shall be decided
            by arbitration in accordance

                                       9
<PAGE>

            with the rules of the American Arbitration Association. This
            agreement to arbitrate shall be specifically enforceable under
            applicable law in any court having jurisdiction. The award rendered
            by the arbitrator shall be final and judgment may be entered upon it
            in accordance with the applicable law of any court having
            jurisdiction thereof.

            14.3 In the event that the Executive is reasonably required to
      engage legal counsel to enforce his rights hereunder against the Company,
      Executive shall be entitled to receive from the Company his reasonable
      attorneys' fees and costs; provided that Executive shall not be entitled
      to receive those fees and costs related to matters, if any, which were the
      subject of litigation and with respect to which a judgment is rendered
      against Executive.

      15. Remedies in the Event of a Change in Control. The terms of this
Section 15 shall apply in the event of a Change of Control.

            15.1 The Executive acknowledges that if he breaches or threatens to
      breach his covenants and agreements in this Agreement, such actions may
      cause irreparable harm and damage to the Company which could not be
      compensated in damages. Accordingly, if Executive breaches or threatens to
      breach this Agreement, the Company shall be entitled to injunctive relief,
      in addition to any other rights or remedies of the Company. All claims,
      disputes and other matters in question between the Executive and the
      Company arising out of or related to the interpretation of this Agreement
      or the breach of this Agreement shall be decided under and governed by the
      laws of the State of Alabama.

            15.2 The Company is aware that upon the occurrence of a Change in
      Control, the Board or a stockholder of the Company may then cause or
      attempt to cause the Company to refuse to comply with its obligations
      under this Agreement, or may cause or attempt to cause the Company to
      institute, or may institute, litigation seeking to have this Agreement
      declared unenforceable, or may take, or attempt to take, other action to
      deny the Executive the benefits intended under this Agreement. In these
      circumstances, the purpose of this Agreement could be frustrated. It is
      the intent of the parties that the Executive not be required to incur the
      legal fees and expenses associated with the protection or enforcement of
      his rights under this Agreement by litigation or other legal action
      because such costs would substantially detract from the benefits intended
      to be extended to the Executive hereunder, nor be bound to negotiate any
      settlement of his rights hereunder under threat of incurring such costs.
      Accordingly, if at any time after a Change of Control, it should appear to
      the Executive that the Company is or has acted contrary to or is failing
      or has failed to comply with any of its obligations under this Agreement
      for the reason that it regards this Agreement to be void or unenforceable
      or for any other reason, or that the Company has purported to terminate
      his employment for cause or is in the course of doing so in either case
      contrary to this Agreement, or in the event that the Company or any other
      person takes any action to declare this Agreement void or unenforceable,
      or institutes any litigation or other legal action designed to deny,
      diminish or to recover from the Executive the benefits provided or
      intended to be provided to him hereunder, and the Executive has acted in
      good faith to perform his obligations under this Agreement, the Company
      irrevocably authorizes the Executive from time to time to retain counsel
      of his choice at the expense of the Company to represent him in connection
      with the

                                       10
<PAGE>

            protection and enforcement of his rights hereunder, including
            without limitation representation in connection with termination of
            his employment contrary to this Agreement or with the initiation or
            defense of any litigation or other legal action, whether by or
            against the Executive or the Company or any director, officer,
            stockholder or other person affiliated with the Company, in any
            jurisdiction. The reasonable fees and expenses of counsel selected
            from time to time by the Executive as hereinabove provided shall be
            paid or reimbursed to the Executive by the Company on a regular,
            periodic basis upon presentation by the Executive of a statement or
            statements prepared by such counsel representing other officers or
            key executives of the Company in connection with the protection and
            enforcement of their rights under similar agreements between them
            and the Company, and, unless in his sole judgment use of common
            counsel could be prejudicial to him or would not be likely to reduce
            the fees and expenses chargeable hereunder to the Company, the
            Executive agrees to use his best efforts to agree with such other
            officers or executives to retain common counsel.

      16. Waiver. Failure of either party to insist, in one or more instances,
on performance by the other in strict accordance with the terms and conditions
of this Agreement shall not be deemed a waiver or relinquishment of any right
granted in this Agreement or of the future performance of any such term or
condition or of any other term or condition of this Agreement, unless such
waiver is contained in a writing signed by the party making the waiver.

      17. Amendments and Modifications. This Agreement may be amended or
modified only by a writing signed by other parties hereto.

      18. Governing Law. The validity and effect of this agreement shall be
governed by and construed and enforced in accordance with the laws of the State
of Alabama.

                                       11
<PAGE>

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year first above written.

EXECUTIVE

_________________________________
John J. Moran

NEXITY FINANCIAL CORPORATION

_________________________________
By: Greg L. Lee
    Chairman of the Board
    and Chief Executive Officer

                                       12

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