Stock Bonus Escrow Agreement

STOCK BONUS


ESCROW AGREEMENT


THIS AGREEMENT is entered into as of this 16th day of April, 2000, among James V. Kelley ("Kelley"), BancorpSouth, Inc. (the "Company") and BancorpSouth Bank as escrow agent ("Escrow Agent").


WHEREAS, at the closing of that merger transaction between BancorpSouth, Inc. and First United Bancshares (the "Closing Date"), the Company will grant to Kelley 100,000 shares of the Company's Common Stock ("Common Stock") which are subject to certain restrictions and risks of forfeiture that are described in the Stock Bonus Agreement, dated April 16, 2000, between Kelley and the Company (the "Stock Agreement");


WHEREAS, pursuant to the Stock Agreement, the Company and Kelley have agreed that the shares of Common Stock granted thereunder shall be held in escrow until such restrictions and risks of forfeiture have lapsed, at which time the shares are to be released to Kelley or, if forfeited, to the Company; and


WHEREAS, the Escrow Agent is willing to hold the shares of Common Stock described in the Stock Agreement pending their release to Kelley or forfeiture to the Company;


NOW, THEREFORE, in consideration of the premises set forth herein and other mutual agreements and good and valuable consideration hereinafter set forth, the parties hereby agree as follows:


1. Transfer of Stock to Escrow Agent. Upon the issuance of the Common Stock under the Stock Agreement, the Company shall issue five stock certificates to the Escrow Agent, each for 20,000 shares of Common Stock granted pursuant to the Stock Agreement, registered in the name of James V. Kelley. Certificates issued upon the execution of the Stock Agreement are referred to herein as "Certificates." Each Certificate will bear a legend substantially as follows:


THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE
TERMS OF AN ESCROW AGREEMENT, DATED APRIL 16, 2000, AMONG
JAMES V. KELLEY, BANCORPSOUTH, INC. AND BANCORPSOUTH BANK AS
ESCROW AGENT, AND MAY NOT BE SOLD OR TRANSFERRED EXCEPT IN
COMPLIANCE WITH SUCH AGREEMENT. A COPY OF THE ESCROW AGREEMENT
IS AVAILABLE AT THE PRINCIPAL OFFICES OF BANCORPSOUTH, INC.


Upon issuance Kelley will, or will cause the Company to, deposit the Certificates with the Escrow Agent, together with one stock power for each Certificate, duly executed in blank, to be held by the Escrow Agent in accordance with the terms of this Agreement.


2. Release of Shares From Escrow. The Escrow Agent will hold the Certificates until they are released. A Certificate, and the attendant stock power, shall be released to


2 Kelley upon the first anniversary of the Closing Date and upon each succeeding anniversary of the Closing Date while he is employed by the Company, until all Certificates have been released to Kelley or forfeited to the Company pursuant to the terms of the Stock Agreement.


(a) Notwithstanding the foregoing, upon receipt, prior to the
anniversary of the Closing Date of any year, of a certificate
signed by the majority of the Company's Board of Directors and
the Company's Secretary certifying that according to the
Company's annual report for the Company's year ending on the
preceding December 31, the Company's Return on Average Assets
was less than 0.9% and its Return on Average Equity was less
than 12.825%, the Escrow Agent will retain the Certificate
that was to delivered to Kelley on the anniversary of the
Closing Date for the year that follows such December 31, and
shall hold such Certificate until it is forfeited or becomes
vested under the terms of the Stock Agreement.


(b) On the fifth anniversary of the Closing Date, the Escrow Agent
shall deliver to Kelley all Certificates in its possession,
together with the accompanying stock powers, that have not
been forfeited pursuant to the terms of the Stock Agreement.


(c) Upon delivery of the Certificates to Kelley, they will bear
appropriate state and federal securities legends as directed
by the Company and appropriate stop transfer instructions will
be noted in the stock records of the Company.


3. Effect of Termination of Employment. Notwithstanding the provisions of Section 2 hereof, the Escrow Agent shall deliver all certificate ...