SCHEDULE 14A INFORMATION
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TABLE OF CONTENTS
MIDSOUTH BANCORP, INC.
102 Versailles Boulevard
Versailles Centre
Lafayette, Louisiana 70501

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

Lafayette, Louisiana
April 1722,20062009

We will hold our annual shareholders meeting on Wednesday, May 17, 2006,27, 2009, at 1:00 p.m., local time, at our corporate offices, 102 Versailles Blvd., Lafayette, Louisiana 70501, where we will elect directors and consider anything else thatvote upon:
1.           Election of Directors.

2.           Proposal to approve a Non-binding Advisory Resolution on the Compensation of our Named Executive Officers.

3.           Such other matters as may properly come before the meeting or any adjournments.

The items of business listed above are more fully described in the Proxy Statement accompanying this notice.  If you are listed on our books as the holder of record of our common stock on March 2431,2006, 2009, you are entitled to notice of and to vote at the meeting.

You will find our proxy statement, Form 10-K and other important information on our website: http://bnymellon.mobular.net/bnymellon/msl.

Your vote is important.  Whether or not you expect to attend the annual meeting, it is important regardless ofthat your shares be represented and voted at the number of shares you own. WHETHER OR NOT YOU PLAN TO COME TO THE MEETING,meeting.

PLEASE MARK, SIGN, DATE AND SIGN THE ENCLOSED PROXY ANDPROMPTLY RETURN IT PROMPTLY IN THE ACCOMPANYING ENVELOPE.  YOUR PROXY MAY BE REVOKED BY NOTICE TO OUR SECRETARY AT ANY TIME BEFORE IT IS VOTED.FOLLOWING THE INSTRUCTIONS FOR VOTING BY MAIL, OR SUBMIT YOUR PROXY BY FOLLOWING THE INSTRUCTIONS FOR VOTING BY PHONE OR ON THE INTERNET.  THANK YOU.
BY ORDER OF THE BOARD
OF DIRECTORS
Karen L. Hail
Secretary

This Page Intentionally Left Blank
 BY ORDER OF THE BOARD OF DIRECTORS
Karen L. Hail
SEVP/Chief Operating Officer 
Secretary to the Board



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MIDSOUTH BANCORP, INC.
102 Versailles Boulevard
Versailles Centre
Lafayette,
lafayette, Louisiana 70501

PROXY STATEMENT

This Proxy Statement is being sent to our stockholders to solicit on behalf of our Board of Directors proxies tofor use at our annual shareholders meeting to be held on Wednesday, May 17, 2006,27, 2009, at the time and place shown in the accompanying notice and at any adjournments thereof.  This Statement is first being mailed to shareholders on or about April 1722,2006. 2009.

Only holders of our common stock ("stock") on our books at the close of business on March 24, 2006,31, 2009, are entitled to notice of and to vote at the Meeting.  On that date we had outstanding 5,016,196 shares.6,788,884 shares of stock, each of which is entitled to one vote.

The presence, in person or by proxy, of holders of a majority of our Stockstock is needed to make up a quorum; if a quorum is present, directors are elected by plurality vote.plurality.  With respect to any other proposal, however, if the Board has recommended it by a majority of our Continuing Directors, as defined in our Articles of Incorporation, then, generally, the vote of a majority of the votes cast is required to approve it, and if it is not so recommended, then the vote of 80% of the Total Voting Power, as defined in the Articles, is required to approve it.  The Continuing Directors will appoint the Judge(s) of Election, and all questions as to voter qualification, proxy validity and accepting or rejecting votes will be decided by the Judge(s).

Abstentions or broker non-votes will not have any effect on the election of directors.  On any other proposal, abstentions and broker non-votes will be counted as votes not cast and will have no effect on any proposal that needs a majority of votes cast to approve it and will have the effect of a vote against any proposal that needs the vote of a percentage of the Total Voting Power.

All proxies received in the enclosed form will be voted as you specify and, unless you specify to the contrary, will be voted for the election of the persons named herein.herein and for the resolution to approve our compensation resolution.  We do not know of anything else to be presented at the Meeting other than the election of directors and approval of the non-binding advisory resolution, but if anything else does come up, the persons named in the enclosed proxy will vote the shares covered by the proxy according to their best judgment.as determined by the Board of Directors.

A proxy may be revoked by you at any time before its exercise by filing with our Secretary a written revocation or a duly executed proxy with a later date. If you vote in person in a manner inconsistent with a proxy previously filed by you, you will be deemed to have revoked the proxy as to the matters you voted on in person.

The cost of soliciting proxies will be borne by us.  In addition to the mail, proxies may be solicited by personal interview, telephone, telegraph, facsimile, internet and e-mail.  Banks, brokerage houses and other nominees or fiduciaries may be asked to forward these materials to their principals and to get authority to execute proxies, and we will, upon request, reimburse them for their expenses in so acting.

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ELECTION OF DIRECTORS

ANNUAL MEETING BUSINESS

Item 1.Election of Directors
Our Articles provide for three classes of directors, with one class to be elected at each annual meeting for a three-year term.  At the Meeting, Class I Directors will be elected to serve until the 20092012 annual meeting.

Unless you withhold authority, the persons named in the enclosed proxy will vote the shares covered by the proxies received by them for the election of the threefour Class I director nominees named below.  If for some reason we do not anticipate one or more nominees cannotcan not be a candidate at the Meeting, the shares will be voted in favor of such other persons as the Board chooses.  Directors will be elected by plurality vote.

Other than the Board, only shareholders who have complied with the procedures of Article IV (H) of our Articles may nominate a person for election.  To do so, you must have given us written notice by December 13, 2005,January 15, 2009, of the following:

(1) as to each person whom you propose to nominate:

(a) his or her name, age, business address, residence address, principal occupation or employment,

(b) the number of shares of our stock of which the person is the beneficial owner and

(c) any other information relating to the person that would be required to be disclosed in solicitations of proxies for the election of directors by Regulation 14A under the Securities Exchange Act of 1934; and

(2) as to you:

(a) your name and address

(b) the number of shares of our Stock of which you are the beneficial owner and

(c) a description of any agreements, arrangements or relationships between you and each person you want to nominate.

Two inspectors, not affiliated with us, appointed by our Secretary, will determine whether the notice provisions were met; if they determine that you have not complied with Article IV(H), your nomination will be disregarded.

The following table gives information as of March 24, 2006,31, 2009, about each director nominee and each other director.  Unless otherwise indicated, each person has had the principal occupation shown for at least the past five years. The Board recommends a vote FOR each of the three nominees named below.YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE ELECTION OF ALL NOMINEES.

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Director Nominees for terms to expire in 20092012 (Class I Directors)
         
        Year First
Name Age  Principal Occupation Became Director
C. R. Cloutier  58  Our President and C.E.O., and President and C.E.O. of our subsidiary, MidSouth Bank 1984
         
J. B. Hargroder, M.D.  75  Physician, retired; Vice Chairman of our Board 1984
         
William M. Simmons  72  Investor 1984
        Name 
Age
 
 
Principal Occupation
 
Year First
Became Director
        
C. R. Cloutier  62 
Our President and C.E.O., and President and C.E.O. of our subsidiary, MidSouth Bank, N.A.
 
 1984
J. B. Hargroder, M.D.
 
  78 Physician, retired; Vice Chairman of our Board 1984
Timothy J. Lemoine
 
  58 Construction Consultant  2007
William M. Simmons  75 Investor 1984

 
Directors whose terms expire in 20072010 (Class II Directors)
         
        Year First
Name Age  Principal Occupation Became Director
Will G. Charbonnet, Sr.  58  Our Chairman of the Board; Executive Director, Lafayette Catholic Social Services (non-profit charity) 1984
         
Clayton Paul Hilliard  80  President/Owner of Badger Oil Corporation, Badger Oil & Gas Ltd., Convexx Oil and Gas, Inc., and Warlord Oil Corporation; Manager, Unigard, LLC 1985
         
Stephen C. May  57  Publisher -The Independent Weekly, Lafayette, LA 2002
         
Joseph V. Tortorice, Jr.  56  CEO, Deli Management, Inc.; Chairman of the Board of Lamar Bank, our wholly-owned subsidiary 2004
 
        Name
 
 
Age
 
    Principal Occupation
 
Year First
Became Director
       
Will Charbonnet, Sr.  61 
Our Chairman of the Board; Treasurer and Managing Director of Crossroads Catholic Bookstore (non-profit corporation); Controller of Philadelphia Fresh Foods, L.L.C.
 
 
       1984
Clayton Paul Hilliard  83 
President of Badger Oil Corporation, Convexx Oil and Gas, Inc., and Warlord Oil Corporation; Manager, Uniqard, L.L.C.
 
 
       1984
Joseph V. Tortorice, Jr.  59 C.E.O., Deli Management, Inc. 
       2004

 
Directors whose terms expire in 20082011 (Class III Directors)
         
        Year First
Name Age  Principal Occupation Became Director
James R. Davis, Jr.  53  President, Davis/Wade Financial Services, L.L.C.; Chairman of our Audit Committee and our Lead Director 1991
         
Karen L. Hail  52  Our Senior Executive Vice President and Chief Operations Officer 1988
         
Milton B. Kidd, III, O.D.  57  Optometrist, Kidd Vision Centers 1996

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Name 
        Age
 
    Principal Occupation
 
Year First
Became Director
        
James R. Davis, Jr.  56 
President, Davis/Wade Financial Services, L.L.C.; Chairman of our Audit Committee and our Lead Director
 
 1991
Karen L. Hail  55 
Our Senior Executive Vice President and Chief Operating Officer and of our subsidiary, MidSouth Bank, N.A.
 
 1988
Milton B. Kidd, III, O.D.
 
  60 Optometrist, Kidd & Associates, L.L.C. 1996
R. Glenn Pumpelly  50 President/C.E.O. Pumpelly Oil Company, L.L.C. 2007
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Item 2.Proposal to Approve a Non-binding Advisory Resolution on the Compensationof our Named Executive Officers
 As a result of our participation in the Capital Purchase Program of the U.S. Treasury’s Troubled Asset Relief Program we are subject to the provisions of the Emergency Economic Stabilization Act of 2008, which was recently amended by the American Recovery and Reinvestment Act of 2009 (ARRA) to provide additional executive compensation requirements.

    Per the additional requirements defined by the ARRA, we submit to our shareholders a non-binding resolution to approve the compensation of named executive officers, as disclosed in this Proxy Statement, including the Compensation Discussion and Analysis, the executive compensation tables and any related disclosure.  Shareholders are encouraged to carefully review the executive compensation sections of this Proxy Statement outlining the Company’s executive compensation program.  Accordingly, the Board of Directors hereby submits for shareholder consideration, the resolution set forth below, commonly known as a “say-on-pay proposal,”

  "Resolved, that the shareholders hereby approve the compensation of our named executive officers as reflected in the proxy statement for the meeting and as disclosed pursuant to the compensation disclosure rules of the Securities and Exchange Commission, which disclosure includes the Compensation Discussion and Analysis, the compensation tables and all related materials."
             The Board of Directors believes that the Company's compensation policies and procedures are centered on a pay-for-performance culture and are strongly aligned with the long-term interests of shareholders, and, accordingly, recommends a vote in favor of this resolution.

If this resolution is not approved by our shareholders, such a vote shall  not be construed as overruling a decision by the Board of Directors or Personnel Committee, nor create or imply any additional fiduciary duty by the Board of Directors or Personnel Committee, nor shall such a vote be construed to restrict or limit the ability of our shareholders to make proposals for inclusion in proxy materials related to executive compensation. Notwithstanding the foregoing, the Board of Directors and Personnel Committee will consider the non-binding vote of our shareholders on this resolution when reviewing compensation policies and practices in the future.

YOUR BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE RESOLUTION ON THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS.


Item 3.Such other matters as may properly come before the meeting or any adjournments
The Board of Directors knows of no other matters to be brought before the shareholders at the meeting.  If other matters are presented for a vote at the meeting, the proxy holders will vote shares represented by properly executed proxies as directed by the Board of Directors.  At the meeting, management will report on our business and shareholders will have the opportunity to ask questions.

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Corporate Governance

Shareholder, Board and Committee Meetings.During 2005,2008 the Board of Directors had eleventwelve meetings, and each director attended at least 75% of the total number of meetings held of the Board and committees of which he or she was a member.  While we encourage all Board members to come to annual shareholder meetings, there is no formal policy as to their attendance.  It is a rare occasion, however, when all members are not there. At the annual meeting in 2005, only one director, William M. Simmons, was absent.

Board Independence.Each year, our Corporate Governance and Nominating Committee reviews the relationships that each director has with us and with other parties.  Only those directors who do not have any relationships that keep them from being independent within the meaning of applicable American Stock Exchange (“AMEX”)NYSE Amex rules and who the Committee finds have no relationships that would interfere with the exercise of independent judgment in carrying out their responsibilities are considered to be “independent directors.” The Committee reviews a number of factors to evaluate independence, including the directors’ relationships with us and our competitors, suppliers and customers; their relationships with management and other directors; the relationships their current and former employers have with us; and the relationships between us and other companies of which they are directors or executive officers. After evaluating these factors, the Board determined that Messrs. Charbonnet, Davis, Hargroder, Hilliard, Kidd, May,Lemoine, Pumpelly, Simmons and Tortorice are independent within the meaning of applicable AMEXNYSE Amex rules.

Shareholder Communications.Shareholders may communicate directly with the Board or the individual chairmen of committees by writing directly to them at P. O. Box 3745, Lafayette, LA  70502. We will forward, and not screen, any mail we receive that is directed to an individual, unless we believe the communication may pose a security risk.

Code of Ethics.The Board has adopted a Code of Ethics for our directors, officers and employees to promote honest and ethical conduct, full and accurate reporting, and compliance with laws as well as other matters.  A copy of the Code of Ethics is posted on the Corporate Relations page of our website atwww.midsouthbank.com.

The Board has an Audit Committee, an Executive Committee, a Personnel Committee, and a Corporate Governance and Nominating Committee.

The Audit Committee ismembers are Messrs. Davis, Charbonnet, Hilliard, Kidd and MayKidd and held ten meetings in 2005.2008.  It is responsible for carrying out the Audit Committee Charter.  The Executive Committee  ismembers are Messrs. Charbonnet, Cloutier, Hargroder, Pumpelly, and Tortorice and met seventen times in 2005.2008.  Its duties include shareholder relations, Bank examination and Securities and Exchange Commission (“SEC”) reporting.  The Personnel Committee ismembers are Messrs. Charbonnet, Davis, Hargroder, and Tortorice and met threefour times in 2005.2008.  It is responsible for evaluating the performance and settingsetting/approving the compensation of our executive officers and administering our Stock2007 Omnibus Incentive Compensation Plan.  The Corporate Governance and Nominating Committee ismembers are Messrs. Charbonnet, Hargroder, Hilliard and Simmons and met once in 2005.2008. It helps the Board to make determinations of director

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independence,assess overall and individual Board performance and recommend director candidates, including recommendations submitted by shareholders.

 
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It is the Corporate Governance and Nominating Committee’s policy that candidates for director have the highest personal and professional integrity, have demonstrated exceptional ability and judgment, and have skills and expertise appropriate for serving the long-term interest of our shareholders.  The Committee’s process for identifying and evaluating nominees is as follows:  (1) in the case of incumbent directors whose terms of office are set to expire, the Committee reviews their overall service during their terms, including the number of meetings attended, level of participation, quality of performance, and any related party transactions with us during the applicable time period; and (2) in the case of new director candidates, appropriate inquiries into their backgrounds and qualifications are made after considering the function and needs of the Board.  The Committee meets to discuss and consider such candidates’ qualifications, including whether the nominee is independent within the meaning of AMEXNYSE Amex rules, and then selects a candidate for recommendation to the Board. In seeking potential nominees, the Committee uses its and management’s network of contacts to compile a list of potential candidates, but may also engage, if it deems appropriate, a professional search firm, although to date it has not done so.

The Committee will consider director candidates recommended by shareholders who follow the procedures set out in Article IV (H) of our Articles described elsewhere.  It does not intend to alter the manner in which it evaluates candidates, including the criteria set forth above, based on whether the candidate was recommended by a shareholder or otherwise.

Eligible shareholders who want to present a proposal qualified for inclusion in our proxy materials for the 20072010 annual meeting must forward such proposal to our Secretary at the address listed on the first page of this Proxy Statement in time to arrive before December 17, 2006.22, 2009.
     A majority of our directors are also directors of MidSouth Bank. Directors are entitled to fees of $200 per month for Board service and $200 per month for MidSouth Bank Board service. The Chairman receives an additional $750 per month, the Vice Chairman an additional $350 per month and the Audit Committee Chairman an additional $670 per month. Each director also receives $350 for each regular meeting, and $125 for each special meeting of the Board of MidSouth Bank, and $150 for the first hour, and $75 per hour for each additional hour, of each committee meeting. Directors receive meeting fees only for meetings they attend.
     In 1997 directors who were not employees were given options to buy up to 16,589 shares of Stock at $4.41 per share, the fair market value on the date of grant, all of which are currently exercisable. Stephen C. May, a more recent addition to the Board, was granted options in 2002 to purchase up to 9,832 shares of Common Stock at $8.60 per share, the fair market value on the date of grant, exerciseable in annual 20% increments beginning in 2003.
The Securities and Exchange Act of 1934 and applicable SEC regulations require our directors, executive officers and ten percent shareholders to file with the SEC initial reports of ownership and reports of changes in ownership of our equity securities, and to furnish us with copies

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of all the reports they file.  To our knowledge, based on a review of reports given us, all required reports were filed timely.
___________________

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SECURITY OWNERSHIP OF MANAGEMENT
AND CERTAIN BENEFICIAL OWNERS

Security Ownership of Management

The following table shows as of March 24, 2006,31, 2009, the beneficial ownership of our Stock by each director and nominee, by each executive officer named in the Summary of Executive Compensation Table below, and by all directors and executive officers as a group.  Unless otherwise indicated, the Stock is held with sole voting and investment power.
         
  Amount and Nature  
  of Beneficial Percent
Name Ownership(1) of Class
Will G. Charbonnet, Sr.  138,784(1,2)  2.76%
C. R. Cloutier  314,764(1,3)  6.22%
James R. Davis, Jr.  56,840(4)  1.13%
Karen L. Hail  118,226(5)  2.34%
J. B. Hargroder, M.D.  355,274(1,6)  7.08%
Clayton Paul Hilliard  190,253(7)  3.78%
Milton B. Kidd, III, O.D.  182,221   3.63%
Stephen C. May  109,498   2.18%
William M. Simmons  163,096(8)  3.25%
Joseph V. Tortorice, Jr.  65,519   1.31%
Jennifer S. Fontenot  26,944   .54%
Donald R. Landry  77,234(9)  1.54%
A. Dwight Utz  11,079(10)  .22%
All directors and executive officers as a group (16 persons)  1,844,660   35.68%

Name 
Amount and  Nature
of Beneficial
 Ownership(1)
  
Percent
of Class
 
Will Charbonnet, Sr.  162,559(1,2)  2.39%
C. R. Cloutier  405,499(1,3)  5.95%
James R. Davis, Jr.  76,325(4)  1.12%
Karen L. Hail  108,588(5)  1.60%
J. B. Hargroder, M.D.  450,131(1,6)  6.63%
Clayton Paul Hilliard  251,539(7)  3.71%
Milton B. Kidd, III, O.D.  242,378   3.57%
Timothy J. Lemoine  27,995(8)  .41%
R. Glenn Pumpelly  17,279   .23%
William M. Simmons  217,463(9)  3.20%
Joseph V. Tortorice, Jr.  98,313   1.45%
J. Eustis Corrigan, Jr.  14,325(10)  .21%
Donald R. Landry  93,572(11)  1.38%
Teri S. Stelly  25,223(12)  .37%
A. Dwight Utz  5,250(13)  .07%
All directors and executive officers
as a group (15 persons)
  2,208,317   32.35%

_______________
(1)Stock held by our Directors’Directors' Deferred Compensation Trust (the “Trust”) is  beneficially owned by its Plan Administrator, our Executive Committee, the members of which could be deemed to share beneficial ownership of all Stock held in the Trust (257,403(360,426 shares or 5.13%5.31% as of March 24, 2006)31, 2009).  For each director, the table includes the number of shares held for his or her account only, while the group figure includes all shares held in the Trust.  Stock held by our Employee Ownership Plan (the “ESOP”) is not included in the table, except that shares allocated to an individual’sindividual's account are included as beneficially owned by that individual.  Shares which may be acquired by exercise of currently exercisable options (“Current Options”) are deemed outstanding for purposes of computing the percentage of outstanding Stock owned by persons beneficially owning such shares and by all directors and executive officers as a group but are not otherwise deemed to be outstanding.

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(2)Includes 36,44047,826 shares as to which he shares voting and investment power.

(3)Includes 118,550226,527 shares as to which he shares voting and investment power.  Mr. Cloutier’sCloutier's address is P. O. Box 3745, Lafayette, Louisiana 70502.

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(4)Includes 6,8568,998 shares as to which he shares voting and investment power.

(5)Includes 9521,244 shares as to which she shares voting and investment power.

(6)Includes 315,672395,800 shares as to which he shares voting and investment power.  Dr. Hargroder’sHargroder's address is P. O. Box 1049, Jennings, Louisiana 70546.

(7)Includes 111,652120,303 shares as to which he shares voting and investment power.

(8)Includes 4,64320,700 shares as to which he shares voting and investment power.

(9)Includes 37,9557,825 shares as to which he shares voting and investment power.

(10)Includes 2,4805,719 shares as to which he shares voting and investment power.

(11)Includes 38,082 shares as to which he shares voting and investment power.

(12)Includes 21,658 shares as to which she shares voting and investment power.

(13)Includes 1,555 shares as to which he shares voting and investment power.
_______________________


The following table shows the number of shares in the Trust and ESOP, and the number of shares subject to Current Options, (options that the named person may exercise in 60 days) that have been included in the above Ownership Table.ownership table.
             
          Current 
Name Trust  ESOP  Options 
Will G. Charbonnet, Sr.  36,830   —   16,589 
C. R. Cloutier  44,846   36,943   47,562 
James R. Davis, Jr.  29,126   —   — 
Karen L. Hail  28,762   39,108   39,478 
J. B. Hargroder, M.D.  39,602   —   — 
Clayton Paul Hilliard  16,750   —   11,000 
Milton B. Kidd, III, O.D.  13,211   —   4,169 
Stephen C. May  —   —   5,899 
William M. Simmons  37,964   —   8,064 
Joseph V. Tortorice, Jr.  —   —   — 
Jennifer S. Fontenot  —   19,381   7,563 
Donald R. Landry  —   18,323   1,815 
A. Dwight Utz  —   1,276   7,231 

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Name Trust  ESOP  
Current
Options
 
Will Charbonnet, Sr.  50,521   --   -- 
C. R. Cloutier  61,519   31,664   24,816 
James R. Davis, Jr.  39,954   --   -- 
Karen L. Hail  39,455   54,862   -- 
J. B. Hargroder, M.D.  54,331   --   -- 
Clayton Paul Hilliard  22,977   --   -- 
Milton B. Kidd, III, O.D.  18,123   --   -- 
Timothy J. Lemoine  7,262   --   -- 
R. Glenn Pumpelly  --   --   -- 
William M. Simmons  52,078   --   -- 
Joseph V. Tortorice, Jr.  2,328   --   -- 
J. Eustis Corrigan, Jr.  --   731   7,875 
Donald R. Landry  --   26,397   -- 
Teri S. Stelly  --   21,658   2,888 
A. Dwight Utz  --   2,792   903 

_______________________

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Security Ownership of Certain Beneficial Owners

The following lists as of March 24, 2006,31, 2009, the only persons other than the persons listed in the table above known to us to beneficially own more than five percent of our Stock.
         
Name and Address Shares Beneficially Percent
Of Beneficial Owner Owned of Class
MidSouth Bancorp, Inc., Employee Stock  406,597(1)  8.11%
Ownership Plan, ESOP Trustees and ESOP Administrative Committee
P. O. Box 3745, Lafayette, LA 70502		        
         
MidSouth Bancorp, Inc.,(2)
  257,403   5.13%
Directors Deferred Compensation Plan, Executive Committee
P. O. Box 3745, Lafayette, LA 70502		        

Name and Address
Of Beneficial Owner
Shares Beneficially
Owned
Percent
of Class
   
MidSouth Bancorp, Inc., Employee Stock
Ownership Plan, ESOP Trustees and
ESOP Administrative Committee
P. O. Box 3745, Lafayette, LA 70502
558,337(1)
8.22%
   
MidSouth Bancorp, Inc., (2)
Directors Deferred Compensation Plan,
Executive Committee
P. O. Box 3745, Lafayette, LA 70502
 
360,4265.31%
___________________
(1)  The Administrative Committee directs the Trustees how to vote the approximately 8,24730,828 unallocated shares in the ESOP as of  March 24, 2006.31, 2009.  Voting rights of the shares allocated to ESOP participants’participants' accounts are passed through to them.  The Trustees have investment power with respect to the ESOP’sESOP's assets, but must exercise it in accordance with an investment policy established by the Administrative Committee. The Trustees are Donald R. Landry, an executive officer, and Katherine Gardner and Brenda Jordan, two Bank employees.  The  Administrative Committee consists of employee Polly Leonard an employee,and Teri S. Stelly, an executive officer, and Dailene Melancon, a Bank officer.

(2)  See Note (1) to the Table of Security Ownership of Management.
_________________________

Certain Transactions

Directors, nominees, executive officers and their associates have been customers of, and have borrowed from MidSouth Bank in the ordinary course of business, and such transactions are expected to continue in the future.  In the opinion of management, our loan policy is less favorable to those persons than to other customers.

C. R. Cloutier and his wife, Brenda Cloutier, have pledged 15,000 shares of our Stock to Whitney Bank securing a loan in the amount of $284,000 with a balance of $241,275 for their daughter's daycare business.  Additionally, Mr. and Mrs. Cloutier have pledged 6,979 shares of our Stock to First National Banker's Bank to secure a personal loan in the amount  of $140,000 with a  balance of $93,000.

James R. Davis has pledged 27,355 shares of our  Stock to Capital One Investments  to secure a $250,000 line of credit with a balance of  $200,000.

C. P. Hilliard has pledged 43,572 shares of our Stock to MidSouth Bank as partial security  on a $1,000,000 line of credit with a balance of  $0.00.  Additionally, Mr. Hilliard has 15,200 shares of our Stock in his UBS account which serves as collateral for his UBS Line of Credit.  The balance outstanding is $200,000.
_________________________
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EXECUTIVE COMPENSATION

COMPENSATION DISCUSSION AND CERTAIN TRANSACTIONSANALYSIS
Summary of Executive Compensation
The following table shows allCompensation Discussion and Analysis may contain statements regarding future individual and Company performance targets or goals. We have disclosed these targets or goals in the limited context of our compensation awardedprograms and, therefore, you should not take these statements to earned bybe  management’s expectations or estimates of results or other guidance. We specifically caution investors not to apply such statements to other contexts.

This Compensation Discussion and Analysis is intended to assist you in understanding our compensation programs.  It is intended to explain the philosophy underlying our compensation strategy and the fundamental elements of compensation paid to our Chief Executive Officer, Chief Financial Officer, and other individuals included in the Summary Compensation Table (“Named Executive Officers”) for 2008.  Specifically, this Compensation Discussion and Analysis addresses the following:
·  Objectives of our compensation programs;
·  What our compensation programs are designed to reward;
·  Process for determining executive officer compensation;
·  Elements of compensation provided to our executive officers;
–­  
The purpose of each element of compensation
–­  
Why we elect to pay each element of compensation
–­  
How each element and our decisions regarding its payment relate to our goals
·  Other important compensation policies affecting our executive officers.

During 2008, the Bank completed a restructuring process to meet the demands and changes of the business brought on by the Bank's rapid growth and increase in size.  The process impacted the implementation of changes in Named Executive Officer compensation, such as changes in base salary levels, as well as the allocation of various compensation elements to these employees.

Additionally, 2008 was a difficult year with turmoil throughout the economy and the financial services sector.  The exceptionally difficult market conditions led to the Treasury’s creation of the Capital Purchase Program (CPP) under the Troubled Asset Relief Program (TARP).  The program provided the opportunity for MidSouth Bancorp, Inc. to benefit from additional capital through sales of our preferred stock and common stock purchase warrants to the Treasury.  We took part in the CPP, and on January 9, 2009 received $20,000,000 in funding.  In February 2009, Congress passed the American Recover and Reinvestment Act of 2009 (ARRA), which placed additional rules upon executive compensation programs previously defined under CPP participation guidelines.  We highlight the impact of all these events on the various elements of our executive compensation elements as we discuss our compensation programs throughout this document.

The Personnel Committee of the Board of Directors (“Committee”) administers our executive compensation programs.  During 2008, the Committee consisted of Will Charbonnet, Sr. (Chairman), James R. Davis, Jr., J. B. Hargroder, M.D., and Joseph V. Tortorice, Jr.  The members of the Committee all qualify as independent, outside members of the Board in accordance with the requirements of the New York Stock Exchange (NYSE Amex), current SEC regulations and section 162(m) of the Internal Revenue Code.

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Objectives of Our Compensation Programs

The Committee has the responsibility for continually monitoring the compensation paid to our Named Executive Officers (NEOs) as well as other executive employees.  The Committee believes that compensation of our executive officers should encourage creation of stockholder value and achievement of strategic corporate objectives.  Specifically, the Committee is committed to ensuring that the total compensation package for our executive officers will serve to:

·  Attract, retain, and motivate outstanding executive officers whom add value to us based on individual and team contributions;

·  Provide a competitive salary structure in all markets where we operate; and

·  Align the executive officers’ interests with the long-term interests of our shareholders to enhance shareholder value.

What Our Compensation Programs Are Designed to Reward

Our executive officers' compensation is designed to reward short as well as long-term performance.  Our policy is to provide a large portion of compensation in cash, including an annual base salary and an opportunity to receive an annual incentive that is based on earnings per share (EPS).  We provide this to keep the executive officers focused on current earnings and stability and to strongly align the executives with the interests of our shareholders.  We also view the annual incentive as a long-term performance vehicle because we examine performance measures including credit quality, credit risk management, deposit growth, regulatory compliance, return on equity, and growth in our assets and income when assessing incentive grants to the executive officers.  Credit quality, non accruals, and charge offs are impacted by long-term performance such that performance in the current year affects these measures in future years.

Additionally, we have historically provided additional compensation benefits through our 1997 Stock Incentive Plan and our Employee Stock Ownership Plan (ESOP), which keeps the executive officers focused on our long-term goals.

Over the last several years, our performance has been above average as compared to similarly situated financial institutions, and the compensation programs are designed to reward and promote the continuation of this performance.  We aim to provide a substantial portion of executive officers’ pay in the form of performance based compensation through the annual incentive opportunity.  The impact of our focus on incentive compensation programs is clear in the reduction of overall pay levels in 2008 compared to 2007.  Although we outperformed peers, our 2008 fiscal-year end EPS was lower than 2007 fiscal-year end levels.

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Process for Determining Executive Officer Compensation

•   Role of the Committee and the Executive Officers. The Committee annually reviews and recommends the levels, performance goals, and strategic objectives, relating to compensation of the Chief Executive Officer to our Board.  Final approval on the Chief Executive Officer’s compensation is made by the full Board.  The Committee also consults with the Chief Executive Officer on the compensation levels of the other executive officers.  Based on these discussions, the Committee along with the Chief Executive Officer recommends the compensation levels for the other Named Executive Officers to the Board.

Additionally, the Committee periodically reviews our incentive plans and other equity based plans.  The Committee reviews, adopts, and submits to the Board any proposed arrangement or plan and any amendment to an existing arrangement or plan that provides or will provide benefits to the executive officers collectively or to an individual executive officer.  The Committee has sole authority to retain and terminate a compensation consultant or other advisor as the Committee deems appropriate.

•   Role of the Compensation Consultant.  During 2008, the Compensation Committee continued its engagement from 2007 with Amalfi Consulting LLC to assist with, and provide guidance on, executive and broad-based employee compensation programs.  In making decisions regarding  executive officer compensation for 2008, the Compensation Committee considered an overall compensation review completed for our top executive employees, including all of the five NEOs,  by Amalfi Consulting in late 2007.  We provide further details on the peer group created for this review under the “Benchmarking” section of this discussion.

The Committee also engaged Amalfi Consulting to assist with the design of an annual incentive plan structure to strengthen the alignment of the performance of plan participants with our goals and objectives.  In addition to the annual incentive planning process, Amalfi Consulting LLC assisted us with the creation of an administrative plan document for its Phantom Stock incentive compensation program.  Amalfi Consulting LLC reported directly to the Committee on all projects conducted and performed no other services renderedfor us in 2008.

•   Benchmarking.  To ensure the competitiveness of our total compensation package, the Committee uses salary survey information from several different nationally recognized surveys that focus on our industry and region.  Specifically, we used salary survey information compiled by themK G & Associates, including surveys from Watson Wyatt and Mercer.  This information was used to evaluate what comparable institutions are paying.   In 2008, K G & Associates conducted no other business with us.  Along with the data compiled by K G & Associates, the Committee considered data from an additional compensation survey conducted by Scheshunoff Management Services.

In using survey data, we benchmark both base salary and annual incentive.  Long-term incentives are not benchmarked because we feel that long-term incentives are not part of the basic compensation of the executive officers.  Long-term incentives are viewed as an additional opportunity for the executive officer based on the value of our stock price.

In prior years our total compensation levels have been within the 50th to 75th percentile of survey market data from comparable organizations in the financial services industry.  In light of the financial difficulties

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and performance during 2008, and the impact of this performance on our incentive program payouts, we expect our total compensation levels are now below these market survey levels.

At the end of 2007 the Committee, in coordination with Amalfi Consulting LLC, conducted an overall review of the executive compensation program.  As part of this review, a peer group of 20 banks comparable to us in terms of geographic location, asset size, growth and performance was selected.  The criteria used to determine the peer group was based upon data as of fiscal year-end 2006.  At the time of the peer group creation, we compared favorably to the peer group on 3-yr asset growth, return on average assets, and return on average equity.  We present a summary of the 2006 comparison in the table below:

  Total Assets  Asset Growth  ROAA  ROAE 
 Summary of Peer Group (Yr-end 2006)  2006Y  3 Yr   2006Y   2006Y 
Average  1,069,305   84.4%  0.96%  10.4%
50th Percentile  990,350   54.4%  0.90%  9.6%
MidSouth Bancorp, Inc.  805,022   86.0%  1.08%  14.7%

In order to provide a more current perspective we present the year-end results, as available, for our peer group as of year-end 2008 in the following table.  During 2008, we continued to compare favorably to peers on measures used to create the peer group in 2006.

Benchmarking Peer Group (as of year-end 2008)(1)
       Total Assets  Asset Growth  ROAA  ROAE 
        2008Y  3 Yr   2008Y   2008Y 
  Company NameTickerCityState $(000) (%)  (%)  (%) 
 1 First M&F CorporationFMFCKosciuskoMS  1,596,865   26.0   0.03   0.37 
 2 Great Florida BankGFLBACoral GablesFL  1,843,867   83.3   -1.12   -11.34 
 3 ViewPoint Financial Group (MHC)VPFGPlanoTX  2,213,447   55.0   0.30   2.95 
 4 Southern Community Financial CorporationSCMFWinston-SalemNC  1,803,778   40.1   0.34   4.02 
 5 BancTrust Financial Group, Inc.BTFGMobileAL  2,088,177   59.9   0.06   0.50 
 6 Encore Bancshares, Inc.EBTXHoustonTX  1,587,844   20.6   -0.54   -4.96 
 7 TIB Financial Corp.TIBBNaplesFL  1,610,114   49.6   -1.36   -20.41 
 8 MetroCorp Bancshares, Inc.MCBIHoustonTX  1,580,238   40.1   0.12   1.50 
 9 CenterState Banks of Florida, Inc.CSFLWinter HavenFL  1,333,143   53.0   0.28   2.21 
 10 Florida Community Banks, Inc.FLRBImmokaleeFL  --   --   --   -- 
 11 Peoples Financial CorporationPFBXBiloxiMS  896,408   6.0   0.56   4.77 
 12 Pulaski Financial Corp.PULBSaint LouisMO  1,304,150   65.1   0.23   3.34 
 13 Peoples BancTrust Company, Inc.PBTCSelmaAL  --   --   --   -- 
 14 Nexity Financial CorporationNXTYBirminghamAL  1,061,580   35.3   -1.27   -20.14 
 15 Bank of Florida CorporationBOFLNaplesFL  1,549,013   171.9   -0.93   -6.70 
 16 First Federal Bancshares of Arkansas, Inc.FFBHHarrisonAR  795,172   -6.7   0.31   3.38 
 17 Federal Trust CorporationFDTRSanfordFL  --   --   --   -- 
 18 United Security Bancshares, Inc.USBIThomasvilleAL  668,002   7.5   0.80   6.83 
 19 Auburn National Bancorporation, Inc.AUBNAuburnAL  745,970   22.7   0.92   12.06 
 20 Sun American BancorpSAMBBoca RatonFL  590,927   113.2   -8.69   -58.26 
   Average     1,368,747   49.6   -0.59   -4.70 
   50th Percentile     1,549,013   40.1   0.12   1.50 
   MidSouth Bancorp, Inc.MSLLafayetteLA  936,815   34.1   0.60   7.79 
(1)  Data for Florida Community Banks, Inc. and Federal Trust Corporation was unavailable at the time of the filing of this document.  People’s Banctrust Company Inc, (PBTC) was acquired by BancTrust Financial Group, Inc. on October 15, 2007.

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Although we did not modify the nature of our compensation programs for our NEOs during 2008, we did use the information from the review, in conjunction with the survey market data, to make decisions related to base salary levels in 2008.  The review will also be used on a going forward basis with respect to any updates or modifications to executive compensation programs in 2009.

Elements of Compensation

We believe it is in the best interest of our shareholders and us to provide competitive compensation to attract and retain the most qualified executive officers with demonstrated leadership abilities that will secure our future.  We do this by providing compensation that is tied to our short and long-term performance goals to motivate our executive officers to attain these goals.

The performance goals that we examine may include credit quality, credit risk management, deposit growth, regulatory compliance, return on equity, and growth in our assets and income.

We have not made any material changes in individual compensation in 2008 compared to 2007.  The elements of compensation used during 2008 to compensate the executive officers include:
·  Base Salary;
·  Annual Incentives;
·  Retirement Benefits;
·  Health and Insurance Plans;
·  Long-term Equity Awards; and
·  Perquisites.

Below is a discussion of each element of compensation listed above, including the purpose of each element of compensation, why we elect to pay each element of compensation, how each element of compensation was determined by the Committee, and how each element and our decisions regarding the payment of each element relate to our goals.

•   Base Salary. Although we favor the use of incentive compensation, we believe it is necessary and prudent to pay a portion of total compensation in the form of a competitive fixed base salary.  We believe the payment of a fixed base salary to our executive officers helps maintain productivity by providing a guaranteed and dependable base amount of income.

When setting base salary levels, the Committee takes into account the total direct cash compensation amount targeted for each executive.  Essentially, base salary is established by determining the amount of money, in combination with the anticipated amount of annual incentive, necessary to attract and retain top caliber executive officers.  Therefore adjustments to base pay levels are made with careful consideration to the total compensation provided to our executive officers.

It is also our goal to set specific base salary levels which appropriately reflect the role and responsibility of the executive officer.  Therefore, the Committee also considers the abilities, qualifications, accomplishments, prior work experience, and cost of living of the executive officer when determining the final recommendation to the Board.

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Due to our restructuring activities in 2007 which extended into 2008, decisions for 2008 base salary changes were not made until April of 2008 and were retroactively applied to January 1, 2008.  We provide the decisions made regarding base salaries changes from 2007 and 2008 for each of the NEOs in the following table:

Named Executive Officer 2007 Base Salary  2008 Base Salary  % Increase 
C.R. Cloutier $200,000  $200,000   0.0%
J. Eustis Corrigan Jr. $175,000  $190,000   8.6%
Karen L. Hail $157,000  $157,000   0.0%
Donald R. Landry $147,000  $154,000   4.8%
A. Dwight Utz $112,000  $121,000   8.0%
Totals for all Five Named Executive Officers as a Group $791,000  $822,000   3.9%

The overall average increase in base pay across all capacitiesfive NEOs during 2008 was 3.9%.  This level is within market norms and also within expectations discussed in our 2007 proxy filing.  On an individual basis, base salary adjustments reflect a consideration of an increase in job responsibilities due to our restructuring, and increases due to considerations of market pay levels for the position.  Due to the current economic environment, no base salary increases have been planned for 2009.

•  Annual Incentives. Annual incentives are provided to the executive officers through our  Company's Incentive Compensation Plan (CICP).  The Named Executive Officers do not participate in any other annual incentive plans.

Company’s Incentive Compensation Plan (CICP)
Annual incentives are primarily designed to reward increased shareholder value as well as to focus the executive officers on our goals for a particular year and to reward executive officers upon achievement of those goals.  We believe annual incentives are an important element of executive officers’ compensation because they provide the incentive and motivation to lead us in achieving success. The annual incentive under the CICP is tied to earnings per share (EPS) and makes up a very significant part of the executive officer’s compensation.  If the executive officer is able to significantly improve our performance then the executive officer will have a significant increase in annual incentive for the year.  If the performance is below target expectations then the executive officer will have a reduction in targeted incentive compensation.

Before the beginning of each year, the Committee awards each executive officer a specified number of phantom shares.  Annual incentives are calculated on a quarterly schedule and are based upon the number of phantom shares awarded to the officer at the start of the year, multiplied by our EPS for the quarter.  Sixty percent of the amount determined at each quarter is paid at that time, with the remaining balance paid at the end of the year, provided we were profitable for the entire year.  If we are not profitable for the year (i.e., the fourth quarter results in a large loss) then the balance will not be paid.

The number of phantom shares granted each year is generally determined in December based upon the number of shares awarded in the past year, and the impact of the award on total compensation

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levels for the executive officer in the coming year.  The determination of award levels takes into account the executive officer’s individual performance compared to the prior year, his or her importance to us, and our subsidiariesoverall financial performance.  The granting of phantom shares as the annual incentive in lieu of awarding cash bonuses is preferred by the Committee.

In December of 2007, the Committee granted phantom shares for 2008 which resulted in the past three years.payouts presented in the table below.  In December of 2008, the grants for 2009 were determined and awarded to each of the NEOs.  Due to the current economic environment and our financial performance  in 2008, there were no increases in the number of shares from 2008 levels.
Phantom Stock Grants 
Named Executive Officer 2008  2009 
 
# of
Shares
  
Estimate of
Value at Start
of Year
  
Earned at
Year-End
  
# of
Shares
  
Dollar Value Estimate(1)
 
C.R. Cloutier  131,250  $173,750  $108,938   131,250  $108,938 
J. Eustis Corrigan Jr.  39,375  $52,125  $32,681   39,375  $32,681 
Karen L. Hail  65,625  $86,875  $54,469   65,625  $54,469 
Donald R. Landry  47,250  $62,550  $39,218   47,250  $39,218 
A. Dwight Utz  28,926  $38,293  $24,009   28,926  $24,009 
(1)  Estimates of dollar values for 2009 are based on basic undiluted EPS value of $0.83. The number of shares for 2008 and 2009 represents the amount of shares allocated at the beginning of the plan year.  There were no changes in the number of shares awarded to each NEO from 2008 to 2009.
___________________

•   Long-term Equity Awards. Salary and annual incentives tend to reward shorter term goals; however, it is important to focus on long-term performance, which is why we have historically granted stock options.  A stock option only rewards the executive if our stock price increases over a period of time.  Due to the volatility of the financial industry and the stock market during 2008, our financial performance, and the uncertainty regarding possible Treasury limitations on equity awards to executives, the Committee did not award stock options to any of the NEOs in 2008.  All long-term equity award programs will be reviewed during 2009.

Employee Stock Ownership Plan:  To encourage ownership by all employees and therefore tie their interest to the interests of the shareholders, we established an employee stock ownership plan (“ESOP”) in 1986.  The ESOP covers all employees who meet minimum age and service requirements. Amounts of annual contributions to the ESOP are determined on a discretionary basis by the Board ..  We made contributions to the NEO ESOP accounts during 2008.

Omnibus Incentive Plan:  In 2007, we received shareholder approval for an Omnibus Incentive Plan.  No other executive officer had total annual salaryequity awards were made under this plan in 2008.  This plan provides us with flexibility in the design and bonus over $100,000 in 2005.implementation of long-term equity award programs.  Under this plan the Committee may award a variety of forms of equity such as restricted stock, stock appreciation rights, and performance shares.  For details on the plan please refer to the Bank’s 2007 Proxy Statement filed on May 30, 2007.

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              Long-Term Compensation
              Other             All
Name and             Annual Restricted Securities     Other
Principal             Compen- Stock Underlying LTIP Compen-
Position Year Salary(1) Bonus(2) sation Award(s) Option(s) Payouts sation(3)
C. R. Cloutier  2005  $229,575  $113,608   0   0   0   0  $9,704 
President & Chief  2004  $222,029  $92,516   0   0   0   0  $8,892 
Executive Officer  2003  $212,504  $76,680   0   0   0   0  $8,895 
                                 
Karen L. Hail  2005  $165,165  $62,567   0   0   0   0  $8,284 
Senior Exec VP &  2004  $152,037  $55,509   0   0   0   0  $6,962 
Chief Oper. Off.  2003  $145,417  $46,008   0   0   0   0  $6,598 
                                 
Donald R. Landry  2005  $136,415  $49,128   0   0   0   0  $7,654 
Exec. VP & Chief  2004  $113,740  $43,945   0   0   0   0  $6,657 
Lending Officer  2003  $110,063  $36,423   0   0   0   0  $6,192 
                                 
A. Dwight Utz  2005  $92,000  $35,532   0   0   0   0  $4,808 
Senior VP & Retail  2004  $92,000  $30,068   0   0   500   0  $4,232 
Executive Manager  2003  $92,000  $22,543   0   0   1,000   0  $4,071 
                                 
Jennifer Fontenot  2005  $88,625  $25,835   0   0   0   0  $4,315 
Senior VP/Chief  2004  $78,500  $31,442   0   0   500   0  $3,812 
Info. Officer  2003  $75,000  $20,136   0   0   1,000   0  $1,622 
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Stock option grants always have an exercise price equal to our stock price at the time they are awarded. We never engaged in the back-dating of stock options nor have we retroactively modified our stock option awards.

We grant stock options upon hire of an executive officer, upon exceptional achievement, or to ensure that an executive officer has outstanding unvested options.  We did not provide any additional long-term compensation under the Omnibus Incentive Plan in 2008.

Although no equity awards were provided in 2008 due to market and financial conditions, we believe that equity, in the various forms defined under our Omnibus Incentive Plan, is the preferable means to incent and reward long-term performance while also serving as a retention vehicle for our current NEOs and an attraction for new talent.

•   Perquisites. We provided the following perquisites in 2008 to certain executive officers:
–­  
(1)Includes director fees of $33,575 and $25,475 for 2005, $26,350 and $25,750 for 2004, $24,550 and $24,325 for 2003, for Mr. Cloutier and Ms. Hail, respectively and director fees of $7,800 for 2005 for Mr. Landry.
(2)Awarded pursuant to the Incentive Compensation Plan of the Bank.
(3)Consists of $7,917, $7,626, $6,882, $4,808 and $4,315 contributed to the ESOP for the accounts of each of Mr. Cloutier, Ms. Hail, Mr. Landry, Mr. Utz, and Ms. Fontenot, respectively; and $1,786, $659 and $772 paid by us in insurance premiums for term life insurance for the benefit of Mr. Cloutier, Ms. Hail and Mr. Landry, respectively.Company car;
Option Holdings
–­  
Moving expenses;
–­  
Country club membership;
–­  
Health club membership; and
–­  
Dinner club membership.

The following table shows thetotal cost for all of these perquisites for all of our NEOs was approximately $24,300.  No individual NEO received a total value of unexercised options heldperquisites in excess of $6,850 during 2008.  We provide further details on perquisites in a supplementary table following the Summary Compensation Table in this document.

We view certain perquisites as beneficial to us as well as compensation to the executive officers.  For example, the club memberships are regularly used in the general course of our business such as for business meetings or entertaining.  Company cars are used primarily for business purposes.

•   Retirement Benefits.  Executive officers are eligible to participate in our 401(k) retirement plan, which is a company-wide, tax-qualified retirement plan.  The intent of this plan is to provide all employees with a tax-advantaged savings opportunity for retirement.  We sponsor this plan to help employees in all levels save and accumulate assets for use during their retirement.  As required, eligible pay under this plan is capped at Internal Revenue Code (IRC) annual limits.  We make annual matching contributions to the 401(k) retirement plan on behalf of the executive officers.

We have entered into Executive Indexed Salary Continuation Agreements with Mr. Cloutier, Ms. Hail, and Mr. Landry.  The agreements provide that upon the executive officer reaching normal retirement age the executive officer will receive payment of amounts as defined in the agreement and presented in the narrative of the Nonqualified Deferred Compensation section of this document.

•   Health and Insurance Plans. The executive officers are eligible to participate in  benefit plans sponsored by us on the Named Executive Officerssame terms and conditions as of December 31, 2005.those generally provided to salaried employees. Basic health benefits, dental benefits, and similar programs are provided to make certain that access to healthcare and income protection is available to our employees and the employee’s family

                 
  Number of Securities Value of Unexercised
  Underlying Unexercised In-the-Money Options
  Options at At
Name December 31, 2005 December 31, 2005(1)
  Exercisable Unexercisable Exercisable Unexercisable
C. R. Cloutier  52,562   7,563  $1,029,438  $138,630 
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- 11 -

                 
  Number of Securities Value of Unexercised
  Underlying Unexercised In-the-Money Options
  Options at At
Name December 31, 2005 December 31, 2005(1)
  Exercisable Unexercisable Exercisable Unexercisable
Karen L. Hail  39,478   3,630  $816,971  $60,537 
Donald Landry  -0-   3,025  $- 0-  $55,448 
A. Dwight Utz  6,791   2,972  $128,102  $35,354 
Jennifer Fontenot  7,123   1,459  $153,302  $5,715 
 
(1)Reflects the difference between the closing sale price of a share of our Common Stock on December 31, 2005, and the exercise price of the options.

Option Exercisesmembers.  The cost of our benefit plans are negotiated with the providers of such benefits and the executive officers contribute to the cost of the benefits.
     The following table shows options exercised by Named Executive Officers
We maintain split dollar insurance arrangements with Mr. Cloutier, Ms. Hail and Mr. Landry.  Each arrangement provides benefits to the executive officer’s designated beneficiary in 2005.the event of the executive officer’s death.
         
  Shares Acquired  
Name On Exercise Value Realized
C. R. Cloutier  10,000  $231,700(1)
Donald Landry  12,620  $312,707(1)

(1)Reflects the difference between the $27.58 closing price of the Stock on October 31, 2005, and the respective exercise price of the options.
Employment and Severance Contracts with Named Executive Officers
We provide Mr. Cloutier, Ms. Hail and Mr. Landry with a supplemental Term Life Insurance Policy payable to a beneficiary of their choice and a supplemental long-term disability policy. We provide additional details on the benefits provided under these policies in the Potential Payments Upon Termination or Change in Control section.

•   Total Compensation

We incorporate a significant portion of the NEOs compensation in the form of annual incentives. As noted earlier, the annual incentive plan is tied to earnings per share and provides a strong link between executive compensation and shareholder interests.  The figure below shows how the drop in earnings per share impacted total compensation earned by our NEOs in 2008.
With the exception of our CFO, Mr. Corrigan Jr. who was hired in 2006 and whose compensation for that year reflects a partial year period and additional equity grant expense, 2008 total compensation was lower than in 2006 and 2007.

In the figure below, we present the 2006 and 2007 pay mix for each of our NEOs.  Base salary and annual cash incentives make up the majority of compensation for our NEOs.  Because of the link between incentive pay and performance (earnings per share), total compensation not only declined

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overall, but the portion of total compensation comprised of incentive pay decreased by 8-11% over the past two years.

Other Important Compensation Policies Affecting Executive Officers

•   Impact of the Emergency Economic Stabilization Act of 2008 (EESA) and the American Recovery and Reinvestment Act of 2009 (ARRA)
On October 14, 2008, the U.S. Treasury announced a program under the EESA in which the Treasury would make preferred stock investments in participating financial institutions.  The program known as the Capital Purchase Program (CPP) under the Troubled Asset Relief Program (TARP) provides a means for institutions to receive capital through sales of preferred stock and common stock purchase warrants to the Treasury.  We took part in the CPP and on January 9, 2009 received $20,000,000 in funds.  As a result, we became subject to certain executive compensation requirements under Treasury regulations which we discuss in further detail below.
On February 17, 2009, President Barack Obama signed the American Recovery and Reinvestment Act of 2009 (“ARRA”) into law.  ARRA amends Section 111 of EESA and adds additional executive compensation requirements for CPP participants.  ARRA also includes provisions

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directing the Secretary of the Treasury and the SEC to impose additional limits on compensation of executives of companies that participate in the CPP as long as the Treasury owns preferred stock and/or stock purchase warrants of such companies under the CPP.  As of the date of the proxy statement, Treasury had not imposed any additional limits.

The following requirements currently apply to all CPP participants, although further clarification is pending from the Treasury on certain aspects of these rules.  Senior Executive Officers (SEOs) are defined as the top 5 most highly-paid executives of a public company whose compensation is required to be disclosed pursuant to SEC regulations.  The SEOs of MidSouth would be the same individuals comprising the NEOs presented in this proxy.  The requirements related to executive compensation are as follows:
o  
Limits on Incentive Compensation – The scope of limits on incentive compensation vary based upon the level of funds received under the CPP.  Since MidSouth received less than $25 million in funds, the following limits apply only to the single most highly-compensated employee of the Bank.  During 2008 this employee would have been Mr. C.R. Cloutier, the Chief Executive Officer of the Company.
§  CCP participants are prohibited from paying or accruing any bonus, retention award or incentive compensation for the covered employee. This prohibition does not apply to any bonus payments required to be paid pursuant to a written employment agreement prior to February 11, 2009.
§  This prohibition does not apply to the granting of long-term restricted stock provided that the equity does not fully vest during CPP participation and is not awarded on an annual basis at a value exceeding 1/3 of the covered employee’s total annual compensation.
o  
Prohibition on Compensation that Provides an Incentive to Take Unnecessary and Excessive Risks – This rule prohibits us from providing incentive compensation arrangements that encourage our SEOs to take unnecessary and excessive risks that threaten the value of the financial institution.  Treasury regulations also require the Personnel Committee to review SEO incentive compensation arrangements with our senior risk officers to ensure that SEOs are not encouraged to take such risks.  The regulations require the Committee to meet at least semi-annually with our senior risk officers to discuss and review the relationship between our risk management policies and practices and the SEO incentive compensation arrangements.  The Personnel Committee has performed this review, and its conclusions are included in its report within this Proxy Statement.
o  
Claw-back Provisions on Incentive Compensation – Incentive compensation plans must provide for the recovery of any bonus, retention award or incentive compensation paid to SEOs and the next 20 most highly-compensated employees (up to a total of 25 employees) that were based upon financial statements or other criteria that are later to be found to be materially inaccurate.  In addition, compensation plans that would encourage manipulation of reported earnings to enhance the compensation of any employee are prohibited.
o  
Limit on Tax Deduction – This provision of the EESA regulations limits our tax deduction for compensation paid to any SEO to $500,000 annually. The provision of

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EESA amended the Internal Revenue Code by adding 162(m)(5). Section 162(m)(5) imposes a $500,000 deduction limit. In addition, prior to the amendment, certain performance based compensation paid under shareholder approved plans did not count toward such deduction limit.  EESA and Section 162(m)(5) eliminate that exclusion for the Company.
o  
Prohibitions on Golden Parachute Payments – CPP participants are prohibited from making any golden parachute payments to SEOs and the next 5 most highly-compensated employees (up to a total of 10 employees).  Golden parachute payments are defined as any payment for departure from a company for any reason, except for payments for services performed or benefits accrued.  We present the estimated impact of this prohibition in our section on Potential Payments Upon Termination or Change in Control.
o  
Limitations on Luxury Expenditures – Our Board must have a policy regarding excessive or luxury expenditures, including entertainment or events, office and facility renovations, aviation or other transportation services, and other activities or events that are not reasonable expenditures for staff development or reasonable performance incentives.  Although a formal policy is not currently in place, we currently do not provide such expenditures and have not historically done so.  For more details on the extent of perquisites and other expenditures provided to our SEOs please see the supplementary tables on perquisites which follow our Summary Compensation Table in this proxy.
o  
Certification of Compliance – The CEO and CFO of a CPP participant must provide certification in writing of compliance with the guidelines to the SEC.
o  
Binding SEO Agreements – Prior to selling the Company’s preferred stock to the Treasury, each of our SEOs executed an agreement which reduces his compensation and other benefits to the extent necessary to comply with these EESA requirements. These agreements will remain effective for so long as Treasury owns any of our CPP securities.
o  
Non-Binding Advisory Proposal on the Compensation of our Named Executive Officers – In accordance with the ARRA and based on recent guidance issued be the SEC, the Board of Directors authorized a non-binding advisory shareholder vote on our executive compensation plans, programs, and arrangements.  We include this proposal in our proxy filing.

With respect to actions yet to be taken, we are currently awaiting issuance of further guidance from the Treasury, but we intend to fully comply with such guidance once it becomes available.

•   Financial Restatement.  Currently, the Committee does not have an official policy governing retroactive modifications to any cash or equity based incentive compensation paid to the executive officers where the payment of such compensation was predicated upon the achievement of specified financial results that were subsequently the subject of a restatement.  However, we adhere to Section 304 of the Sarbanes-Oxley Act of 2002 which requires that if a company is forced to restate its financials the company’s Chief Executive Officer and Chief Financial Officer must give back certain incentives based or equity based compensation received.

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We have never retroactively modified incentives or equity based compensation for our employees.  The Incentive Compensation Plan pays out quarterly based on our EPS for each quarter; however, only 60% of the value is paid out.  The remaining 40% is held back until after year-end earnings have been determined.  If there is a decline in earnings for the year, amounts held back may not be paid to the executive officers as the annual incentive is based on our EPS.

Under the Treasury’s Troubled Asset Relief Program participants in the CPP are required to implement claw-back provisions on all incentive programs.  The guidelines state all compensation plans must provide for the recovery of any bonus, retention award or incentive compensation paid to Senior Executive Officers and the next 20 most highly-compensated employees (up to 25 employees) that were based on financial statements or other criteria that are later found to be materially inaccurate.  MidSouth Bank plans to comply with this requirement.

•   Stock Ownership Requirements.  The Committee does not maintain a policy relating to stock ownership guidelines or requirements for our executive officers.  The Committee does not believe it is necessary to impose such a policy on the executive officers.  Currently, the NEOs, as a group, hold a substantial portion of our stock.  If circumstances change, the Committee will review whether such a policy is appropriate for our executive officers.

•   Trading in the Company’s Stock Derivatives.  The Committee does not have a policy prohibiting executive officers from purchasing or selling options on our stock, engaging in short sales with respect to our stock,  or trading in puts, calls, straddles, equity swaps or other derivative securities that are directly linked to our  stock.  We are not aware that any of the executive officers have entered into these types of arrangements.

•   Tax Deductibility of the Named Executive Officers’ Incentive and Equity Compensation.  Section 162(m) of the Internal Revenue Code generally disallows a tax deduction to public companies for compensation over $1.0 million paid to a corporation’s Chief Executive Officer and the four other most highly compensated executive officers.

In connection with the compensation of our executive officers, the Committee is aware of section 162(m) as it relates to deductibility of qualifying compensation paid to executive officers. The Committee  believes  that compensation earned in 2008 will not exceed the deductibility limitations on non-excluded compensation to certain executive officers.

TARP participants are subject to provisions of section 162(m)(5) of the Internal Revenue Code which limits the deduction of compensation to $500,000 per year for Senior Executive Officers.  Compensation covered by this limitation includes incentive compensation and deferred compensation.  We do not believe that compensation provided in 2008 surpasses the $500,000 level for any of our Senior Executive Officers.

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•   Employment Agreements.  In late 2007, we and Mr. C.R. Cloutier agreed upon a termination of his employment agreement.  The termination of the agreement was effective on March 19, 2008 and was completed in compliance with the provisions of the agreement.  This termination was conducted for the sole purpose of removing both us and Mr. Cloutier from any obligations per the terms of the agreement.  There was no change in Mr. Cloutier’s employment status with us as a result of the agreement termination.

On January 15, 2009, Mr. Corrigan terminated employment with us by voluntary resignation.  He received no benefit or payout in connection with this termination event.

We currently maintain an employment agreement with our Chief Operations Officer, Ms. Karen L. Hail. We will enter into a new employment agreement with an executive officer or a potential candidate only when it is essential to attract or retain an exceptional employee.  Any employment agreement with an executive officer must be approved by the Board and should have as short a term as possible and provide as few terms and conditions as are necessary to accomplish its purpose.

The employment agreement with Ms. Hail has trigger events that provide for the payment of severance to her upon certain termination events.  We have included these trigger events in the employment agreement to provide a safe harbor so that Ms. Hail can provide services to  us without being concerned about her employment.

Set forth below are the general terms and conditions of Ms. Hail’s employment agreement.  Ms. Hail has the right to voluntarily terminate her employment at any time.  Note that while under participation in the CPP, certain payouts under the agreement may be prohibited.  We present the impact of these prohibitions in the section titled Potential Payments Upon Post-Termination in this proxy.

The employment agreement is a one year written employment agreement with MidSouth Bank beginning January 1st of each year and is automatically extendingextended for one year every year thereafter, unless written notice of termination is given by any party to the agreement not later than 60 days before the end of the year.  Pursuant to the contracts, theyMs. Hail will receive a minimum annual base salary, term life insurance in the amount of four times their annual base salary payable to a beneficiary of theirher choice, and disability insurance of not less than two-thirds of their annual salary. The contracts havebase salary, an automobile furnished by us (including insurance, gasoline, and other routine maintenance), membership at a severance provision which entitles them to one year’s salary ifhealth club, and membership at a dinner club.

In the event that we terminate Ms. Hail's employment or do not extend the agreement, she will be entitled to severance pay equal to annual base salary at the time of termination.  We will not be obligated to pay any severance pay in the event that she terminates voluntarily or is terminated by MidSouth Bank, unless they are removed by a regulatory body.
Certain Transactions
     Directors, nomineesUpon a change in control of us, Ms. Hail has the right to resign employment for Good Reason and receive as severance pay a sum equal to annual base salary immediately prior to the change in control, payable in twelve equal installments.  Good Reason is deemed to occur upon one of the following events:

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(1)a reduction in her salary or benefits in effect before the effective date of the change in control within two years after the effective date of the change in control;
(2)a requirement that she move her residence out of Lafayette, Louisiana;
(3)a requirement that she engage in excessive business travel (i.e., travel of more than 75 miles from Lafayette, Louisiana for more than an average of 7 business days per month) as part of her job duties; or
(4)her office is moved outside of the Lafayette MSA.

Ms. Hail is not entitled to receive a Gross-Up payment in the event that she is subject to section 280G excise tax pursuant to a change in control of the Company.

•   Tax and Accounting Implications.  We consider the tax and accounting implication regarding the delivery of different forms of compensation.  We believe that the most efficient form of compensation for the executive officers is cash and, their associates have been customerstherefore, place a greater emphasis on cash compensation over other forms (i.e., equity).

•   §409A Compliance.  All compensation plans and other relevant documents were reviewed and modified as needed to comply with Internal Revenue Code - Section §409A requirements as of and have borrowed from, our bank subsidiaries in the ordinary course of business, and such transactions are expected to continue in the future. In the opinion of management, our loan policy is less favorable to directors than to other customers.year-end 2008.

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Shareholder Return Performance Graph
 The following graph, which was prepared by SNL Securities LC (“SNL”), compares the cumulative total return on our Stock over a period beginning December 31, 2000 with (i) the cumulative total return on the stocks included in the Russell 3000 and (ii) the cumulative total return on the stocks included in the SNL $250M-$500M and the SNL $500M-$1B Bank Index. All of these cumulative returns are computed assuming the quarterly reinvestment of dividends paid during the applicable period.
MidSouth Bancorp, Inc.
(PERFORMANCE GRAPH)
                         
  Period Ending
Index 12/31/00 12/31/01 12/31/02 12/31/03 12/31/04 12/31/05
 
MidSouth Bancorp, Inc.  100.00   137.04   207.94   421.61   455.99   507.03 
Russell 3000  100.00   88.54   69.47   91.04   101.92   108.16 
SNL $250M-$500M Bank Index  100.00   142.07   183.20   264.70   300.43   318.97 
SNL $500M-$1B Bank Index  100.00   129.74   165.63   238.84   270.66   282.26 
Our Stock is traded on the AMEX under the “MSL” ticker symbol. The stock price information shown above is not necessarily indicative of future price performance. Information used was obtained by SNL from sources believed to be reliable. We are not responsible for any errors or omissions in such information.

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PERSONNELCOMPENSATION COMMITTEE REPORT

The Personnel Committee has reviewed and discussed the Compensation Discussion and Analysis with management.  Based upon such review, the related discussions and such other matters deemed relevant and appropriate to the Committee, the Committee has recommended to the Board that the Compensation Discussion and Analysis be included in this Proxy Statement to be delivered to shareholders.
Submitted by the Personnel Committee:
Will Charbonnet Sr., Chairman
James R. Davis, Jr.
J. B. Hargroder, M.D.
Joseph V. Tortorice, Jr.
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RISK COMMITTEE REPORT

The Risk Committee hereby certifies that is has reviewed the Senior Executive Officer (SEO) and Highly Compensated Employee (HCE) compensation arrangements and has made upreasonable efforts to ensure that such arrangements do not encourage an SEO or HCE to take unnecessary and excessive risks that threaten the value of four non-employee directors, allMidSouth Bancorp, Inc.  The nature of whomthe senior executive compensation arrangements reviewed, including compensation connected with stock performance and the employee stock ownership program contributions appear reasonably tied to the positive long-term performance and value of the company.  None of the compensation aggregates reviewed are independent as defined inclose to the AMEX listing standards. deduction limit, for federal income tax purposes, for compensation for covered SEOs.
 Submitted by the Risk Committee:
James R. Davis, Jr., Lead Director
Will Charbonnet Sr., Chairman of the Board
Teri Stelly, Controller (Interim Chief Financial Officer)
George Shafer, Compliance
Arleen Bodin, Security
Glenda Montet, Risk Manager
Karen Penny, Loan Review
Jay Angelle, Legal Counsel
Larry Miller, Auditor

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SUMMARY COMPENSATION TABLE

The Committee is committed to ensuring ourSummary Compensation Table below displays the total compensation packageawarded to, earned by or paid to the NEOs for 2006, 2007 and 2008.  All amounts shown below are in dollars.
Name and Principal
Position
 Year Salary  
Bonus(1)
  
Stock
Awards
  
Option Awards(2)
  
Non-Equity Incentive
Plan Compensation (3)
  Change in Pension Value and Nonqualified Deferred Compensation Earnings  
All Other Comp.(5)
  Total 
(a)
 
(b)
 
(c)
  
(d)
  
(e)
  
(f)
  
(g)
  
(h)
  
(i)
  
(j)
 
C.R. Cloutier, President & Chief Executive Officer
 
 
 2008 $200,000  $100  $0  $0  $108,938  $0  $90,970  $400,008 
 2007 $199,833  $0  $0  $4,127  $173,750  $0  $85,133  $462,843 
 2006 $196,000  $0  $0  $10,069  $163,339  $0  $80,216  $449,624 
J. Eustis Corrigan Jr.,
EVP & Chief Financial
Officer
 
 2008 $190,000  $3,434  $0  $24,650  $32,681  $0  $18,902  $269,667 
 2007 $174,584  $3,333  $0  $24,650  $52,125  $0  $12,097  $266,789 
 2006 $85,038(4) $3,333  $0  $13,108  $24,750  $0  $14,140  $140,369 
Karen L. Hail, Senior
Executive VP & Chief
Operations Officer
 
 2008 $157,000  $100  $0  $0  $54,469  $0  $75,533  $287,102 
 2007 $156,709  $0  $0  $1,981  $86,875  $0  $67,995  $313,560 
 2006 $149,595  $0  $0  $4,833  $82,250  $0  $61,900  $298,578 
Donald R. Landry,
Executive VP & Chief Lending Officer
 
 2008 $154,000  $100  $0  $0  $39,218  $0  $34,443  $227,761 
 2007 $146,708  $0  $0  $1,651  $62,550  $0  $35,513  $246,422 
 2006 $139,552  $0  $0  $4,028  $57,733  $0  $36,414  $237,727 
A. Dwight Utz,
Senior VP & Chief Retail Officer
 
 2008 $121,000  $100  $0  $1,942  $24,009  $0  $11,129  $158,180 
 2007 $112,000  $0  $0  $1,942  $38,293  $0  $10,428  $162,663 
 2006 $98,348  $0  $0  $5,373  $44,346  $0  $10,172  $158,239 
(1)Mr. Corrigan received a $10,000 signing bonus upon his hire in 2006.  He will earn this bonus ratably over  a 3 year period beginning on his hire date.  In lieu of an end-of-year holiday party, all employees of the bank, including the NEOs received a one-time $100 bonus payment.

(2)Reflects compensation expense recognized for financial statement reporting purposes for 2006, 2007 and 2008 computed in accordance with Statement of Financial Accounting Standards No. 123 (revised 2004) Share Based Payment (“FAS 123R”), disregarding the estimate of forfeitures related to service-based vesting conditions, with respect to awards granted in 2006 and in prior years.

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Assumptions used in the calculation of this amount are included in footnote 11 to our audited financial statements for 2006 included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC"), footnote 1 to our audited financial statements for 2004 included in our Annual Report on Form 10-K filed with the SEC and footnote 12 to the audited financial statements for 2003 included in our Annual Report on Form 10-KSB filed with the SEC.

(3) 
Amounts paid out pursuant to our Incentive Compensation Plan for awards granted in December 2005 for 2006 consist of phantom shares granted of 124,118 to Mr. Cloutier, 62,500 to Ms. Hail, 43,870 to Mr. Landry, and 24,579 to Mr. Utz.  Grants of phantom shares for 2006 have been adjusted for the 5:4 stock split on October 24, 2006.  The phantom shares paid out based on the basic undiluted earnings per share of $1.316 on year-ending 12/31/2006. In 2006, Mr. Utz earned $12,000 per the terms of a Supplemental Incentive Compensation plan based upon deposit and loan goals. This was the last year of Mr. Utz’s participation in the Supplemental Incentive Compensation plan. Pursuant to Mr. Corrigan’s employment agreement, he was granted 37,500 phantom shares upon his hire date, which has been adjusted for the 5:4 stock split on October 24, 2006. Mr. Corrigan’s phantom shares paid out based on a value of $0.66, the combined 3rd quarter and 4th quarter earnings per share for the 2006 calendar year.

Amounts paid out pursuant to our Incentive Compensation Plan for awards granted in December 2006 for 2007 consist of phantom shares granted of 129,644 to Mr. Cloutier, 38,899 to Mr. Corrigan Jr., 64,382 to Ms. Hail, 46,679 to Mr. Landry, and 28,577 to Mr. Utz.  Phantom share
amounts have been adjusted from numbers awarded on December 31, 2006 to account for the Chief Executive Officer and other named executive officers will serve to:
Attract, retain and motivate outstanding executive management who add value to us based5% stock dividend on individual and team contributions;
Provide a highly competitive salary structure in all markets where we operate;
Facilitate employee ownership through equity components of performance-based long-term incentive stock plans that also enhance shareholder value.
     In recent years, due to industry consolidation,September 19, 2007. The phantom shares paid out $1.34, the Peer Bank Group used for comparative purposes continues to shrink. Recognizing this, the Committee engaged a national compensation consulting firm, KG & Associates, for compensation comparisons and information provided by Sheshunoff Management Services, L.P. (“SMS”) for compensation comparisons and measure of our performance.
Base Compensation: To ensure the competitiveness of our total compensation package, the Committee reviews salary survey information developed by our Human Resources Department regarding the compensation practices of a peer bank group using information from a national compensation consulting firm. In addition, the Committee reviews financial industry salary survey information developed by SMS. The goal is to set executive base compensation plus quarterly incentive pay between the top of the second quartile and the lower part of the 1st quartile for the peer group. It is our goal to set the base compensation part of total compensation to comfortably meet the executive’s needs and to put more emphasis on incentive pay so that the executives are encouraged to grow our value short term and long term. This way, the executive is well compensated in relation to our performance.
Incentive Compensation: We use a system of incentive compensation to reward the executives quarterly based on our earnings per share. At the beginning of each year our Board awards each executive a specified number of fictitious shares of our Stock. Incentive compensation is determined quarterly equal to the number of fictitious shares times ourbasic undiluted earnings per share for the quarter. Sixty percentyear-ending 12/31/2007.

Amounts paid out pursuant to our Incentive Compensation Plan for awards granted in December 2007 for 2008 consist of the amount determined is paid each quarter, and the balance is paid at the endphantom shares granted of the year if we were profitable for the year. We believe this method encourages the executives131,250 to think in terms of earnings per share because a substantial portion of their pay is tied to earnings per share.
In January 2006, fictitious shares of Stock were granted as follows: Mr. Cloutier, 99,294;39,375 to Mr. Corrigan Jr., 65,625 to Ms. Hail, 50,000;47,250 to Mr. Landry, 35,096;and 28,926 to Mr. Utz, 19,663; and Ms. Fontenot, 16,638.
At the Personnel Committee Meeting of January 11, 2006 the chief executive officer pay was set for 2006 with his base salary remaining the same and all of his increased pay being tied to additional incentive compensation. So, for 2006, his base pay was set at $196,000 and his projected incentive

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compensation, based on 2005 earnings per share of $1.48 would result in incentive compensation of $147,134, which is 75 % of base pay. Actual incentive compensation will varyUtz.  The phantom shares paid out based on earnings per share of $0.83, the basic undiluted earnings per share for 2006.the year-ending 12/31/2007.
Long Term Incentives: It is our belief that
(4)Mr. Corrigan was hired effective June 12, 2006 with a base salary of $165,000.  Base salary above reflects amounts from beginning of his employment through December 31, 2006.

___________________

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(5)We provide details on the amounts reported for “All Other Compensation” in the supplementary tables below.

 
C.L. Cloutier – All Other Compensation
 2008 
Auto Expense(a)
 $113 
Board of Director Fees(b)
 $52,025 
Cell Phone/ PDA $1,770 
Club Membership $3,184 
Company Contribution to Indexed Salary Continuation Plan Pre-Retirement Account(c)
 $10,956 
Employer 401K Contribution $1,648 
ESOP Contributions $10,178 
Imputed Income from Split-Dollar Life Insurance $667 
Supplemental Life Insurance $3,161 
Supplemental Long-Term Disability Insurance $6,768 
Uniform Allowance $500 
Total $90,970 
(a)We provide an automobile to Mr. Cloutier.  Amounts reported in the table reflect the personal-use levels of this perquisite.
(b)Reflects annual cash fees for board service. We provide further details on the breakdown of fees provided for board responsibilities in the Director Compensation disclosure section of the proxy.
(c)Reflects the annual accrued benefit liability for the pre-retirement accounts under the Indexed Salary Continuation Plan.


 
J. Eustis Corrigan Jr. - All Other Compensation
 2008 
Cell Phone/ PDA $1,120 
Club Membership $3,830 
Employer 401K Contribution $646 
ESOP Contributions $10,178 
Housing/ Relocation(a)
 $2,628 
Uniform Allowance $500 
Total $18,902 
(a)  The relocation expenses provided to Mr. Corrigan were paid in 2006; however under the terms of his employment agreement, the amount paid is earned on an annual basis over a three-year period.  Therefore, amounts reported in this table and in the Supplementary Compensation Table are prorated over the three years in which they are earned.
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Karen L. Hail – All Other Compensation
 2008 
Auto Expense(a)
 $1,159 
Board of Director Fees(b)
 $43,400 
Cell Phone/ PDA $571 
Club Membership $1,205 
Company Contribution to Indexed Salary Continuation Plan Pre-Retirement Account(c)
 $10,374 
Employer 401K Contribution $980 
ESOP Contributions $10,178 
Imputed Income from Split-Dollar Life Insurance $640 
Supplemental Life Insurance $1,787 
Supplemental Long-Term Disability Insurance $4,739 
Uniform Allowance $500 
Total $75,533 
(a)We provide an automobile to Ms. Hail.  Amounts reported in the table reflect the personal-use levels of this perquisite.
(b)Reflects annual cash fees for board service. We provide further details on the breakdown of fees provided for board responsibilities in the Director Compensation disclosure section of the proxy.
(c)Reflects the annual accrued benefit liability for the pre-retirement accounts under the Indexed Salary Continuation Plan.

 
Donald R. Landry - All Other Compensation
 2008 
Auto Expense(a)
 $686 
Board of Director Fees(b)
 $4,875 
Cell Phone/ PDA $1,064 
Club Membership $4,593 
Company Contribution to Indexed Salary Continuation Plan Pre-Retirement Account(c)
 $8,956 
Employer 401K Contribution $672 
ESOP Contributions $9,414 
Imputed Income from Split-Dollar Life Insurance $486 
Supplemental Life Insurance $772 
Supplemental Long-Term Disability Insurance $2,425 
Uniform Allowance $500 
Total $34,443 
(a)We provide an automobile to Mr. Landry.  Amounts reported in the table reflect the personal-use levels of this perquisite.
(b)Reflects annual cash fees for board service. We provide further details on the breakdown of fees provided for board responsibilities in the Director Compensation disclosure section of the proxy.
(c)Reflects the annual accrued benefit liability for the pre-retirement accounts under the Indexed Salary Continuation Plan.

 
A. Dwight Utz - All Other Compensation
 2008 
Auto Expense(a)
 $196 
Cell Phone/ PDA $1,087 
Club Membership $1,218 
Employer 401K Contribution $1,133 
ESOP Contributions $6,995 
Uniform Allowance $500 
Total $11,129 
(a)We provide an automobile to Mr. Utz.  Amounts reported in the table reflect the personal-use levels of this perquisite.

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GRANTS OF PLAN BASED AWARDS

The Grants of Plan Based Awards Table discloses the total number of non-equity incentive based plan awards actually granted in 2008.  There were no grants of equity incentive plan awards during 2008.  The Grants of Plan Based Awards Table should be read in conjunction with the Summary Compensation Table.  The values in the Summary Compensation Table reported for 2008 reflect the portion of expense for stock option awards made in previous years recognized for financial statement reporting purposes during 2008.
      
Estimated Future Payouts Under Non-
Equity Incentive Plan Awards (2)
 
NameGrant Date 
Non-equity
incentive Plan
Awards: Number
of Units
or Other Rights (1)
  Threshold  Target  Maximum 
(a)(b)    (c)  (d)  (e) 
C.R. Cloutier12/31/2008  131,250  $0  $108,938   -- 
J. Eustis Corrigan Jr.12/31/2008  39,375  $0  $32,681   -- 
Karen L. Hail12/31/2008  65,625  $0  $54,469   -- 
Donald R. Landry12/31/2008  47,250  $0  $39,218   -- 
A. Dwight Utz12/31/2008  28,926  $0  $24,009   -- 
___________________

(1)Amounts granted pursuant to our Incentive Compensation Plan as described in the Compensation Discussion & Analysis.  Grants determined and awarded in December 2008 for the 2009 calendar year.

(2)Threshold is zero based upon basic earnings per share value of $0.  Target is based on the December 31, 2008 basic earnings per share of $0.83 times the number of non-equity incentive plan awards granted for 2009. Maximum values cannot be provided since payouts are based directly upon earnings per share with no cap applied.

___________________

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OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END

The Outstanding Equity Awards at Fiscal Year End Table reflects each NEOs unexercised option award holdings at December 31, 2008 on an individual award basis.  There were no stock awards outstanding as of December 31, 2008.


Options Awards
Name 
Number of Securities Underlying Unexercised Options Exercisable
(#)
  
Number of Securities Underlying Unexercised Options Unexercisable
(#)
  
Equity Incentive
Plan Awards
Number of
Securities
Underlying Unexercised
Unearned Options
(#)
  
Options
Exercise
Price
  
Option
Expiration
Date
  
Date
Equity
Fully Vests
(a) (b)  (c)  (d)  (e)  (f)   
C.R. Cloutier  24,814   0   0  $6.55  5/31/2012  05/31/2007
J. Eustis Corrigan Jr.  7,875   11,813   0  $22.48  6/21/2016  06/21/2011
A. Dwight Utz  722   180   0  $13.77  11/30/2014  11/30/2009
(1)  All options listed above vest at a rate of 20% per year over a five year period from the date of grant.

___________________
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OPTION EXERCISES AND STOCK VESTED

The Option Exercises and Stock Vested Table reflects stock options actually exercised by each of the NEOs during 2008.

  Option Awards Stock Awards
Name 
Number of Shares Acquired on Exercise
(#)
  
Value
Realized
upon Exercise
  
Number of Shares Acquired on Vesting
(#)
  
Value
Realized
on Vesting
  
(a) (b)  (c)  (d)  (e)  
C.R. Cloutier  24,193  $359,024(1)  0  $0  
Karen L. Hail  11,911  $186,050(2)  0  $0  
A. Dwight Utz  11,910  $180,946(3)  0  $0  


(1)Reflects the difference between $22.61, the closing price of our stock on 2/21/2008, and $7.77, the exercise price of the options.

(2)Reflects the difference between $22.17, the closing price of our stock on 1/15/2008, and $6.55, the exercise price of the options.

(3)Reflects the sum of the following two amounts; difference between $21.25, the closing price of our stock on 5/12/2008 and $5.59, the exercise price for 9,925 options; plus the difference between $21.25, the closing price of the stock on 5/12/2008 and $8.62, the exercise price for 1,985 options.

___________________

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PENSION BENEFITS

The Company does not provide pension benefits to the NEOs. We have entered into an Executive Indexed Salary Continuation Agreement with Mr. Cloutier, Ms. Hail and Mr. Landry. The agreements provide benefits to the executive officers need to haveupon reaching normal retirement age and are categorized as a significant interest tied to long term performancenonqualified deferred compensation benefit. We discuss the details of this arrangement and shareholder increased value. We believepresent the best way to accomplish this is through ownership of us. We encourage executive officers to own stock and provideamounts in the following programs to encourage stock ownership.
DirectorsNonqualified Deferred Compensation Plan: Our Deferred Compensation Plan encourages all directors to take partsection below.

NONQUALIFIED DEFERRED COMPENSATION

We provide Mr. Cloutier, Ms. Hail, and Mr. Landry with an Executive Indexed Salary Continuation Agreement which establishes a Pre-Retirement Account.  Upon the executive officer reaching normal retirement age, he or she will receive payment of their director paythe Pre-Retirement Account made in sharesannual installments over 10 years.  The Pre-Retirement Account has been established as a liability reserve account on our books for the benefit of Stock.
ESOP: To encourage ownershipthe executive officer.  The account is increased or decreased each year by all employees and therefore tie their interestan amount equal to the interestIndex (annual earnings/loss for the year determined by the aggregate annual after-tax income as if potential life insurance contracts were purchased on the effective date of the shareholders,agreement) less the cost of funds expense for that year (sum of the amount of premiums set forth in the potential life insurance contracts purchased on the effective date of the agreement, plus the amount of any after-tax benefits paid to the executive officer plus the amount of all previous years after-tax costs of funds expense and multiplying the sum by the average after-tax cost of funds of our third quarter report for the year as filed with the Federal Reserve).

If the executive officer voluntarily terminates or we established an ESOP Planterminate the executive officer (not for cause) prior to normal retirement age, the executive officer will be entitled to receive 20% multiplied by the number of full years he or she has served from the date of the agreement (to a maximum of 100%) times the balance in 1986.the Pre-Retirement Account (as described above).  The benefit is payable over 10 years in equal installments, beginning on the date the executive officer reaches normal retirement age.
Stock Options:
If the executive officer dies before having received the full balance of the Pre-Retirement Account, the unpaid balance will be paid in a lump sum to the executive officer’s designated beneficiary.

In the event of a change of control of us, and the executive officer’s employment is terminated; thereafter, the executive officer receives the benefits as promised under the agreement upon attaining normal retirement age as if he/she had been continuously employed by us through normal retirement age.  Please refer to the Potential Payments Upon Termination or Change of Control section of this document for details of payouts under various termination scenarios.  The nonqualified deferred compensation amounts deposited in the Pre-Retirement Accounts is included the table which follows.
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In addition to the above,deferred compensation provided under the Executive Indexed Salary Continuation Agreement, we have periodically grantedprovide a Director’s Deferred Compensation Plan to all Company directors, including NEOs serving on our Board. Mr. Cloutier and Ms. Hail are the only NEOs with a balance in this deferred compensation plan.  We provide details on this plan within the Compensation of Directors section of this proxy.

The Nonqualified Deferred Compensation Table reflects the activity during the 2008 calendar year for each of the NEOs eligible for our deferred compensation benefits.

N      Nonqualified Deferred Compensation
Name 
Plan(1)(2)
 Executive Contributions in Last Fiscal Year  Registrant Contributions in Last Fiscal Year  
Aggregate Earnings in
Last Fiscal
Year
  
Aggregate Withdrawals/
Distributions
  
Aggregate
Balance at
Last Fiscal
Year
 
(a)   (b)  (c)  (d)  (e)  (f) 
C.R. Cloutier DDCP $0  $0  $-609,762  $0  $784,367 
C.R. Cloutier EISCP $0  $10,956  $0  $0  $71,458 
Karen L. Hail DDCP $0  $0  $-391,082  $0  $503,051 
Karen L. Hail EISCP $0  $10,374  $0  $0  $59,346 
Donald R. Landry EISCP $0  $8,956  $0  $0  $50,351 
(1) DDCP is the Director’s Deferred Compensation Plan. Deferred Compensation Plan is invested in our common stock.  On January 2, 2008 our stock optionsprice was $23.58 per share.  On December 31, 2008 our stock price declined to $12.75 per share resulting in a loss of earnings and a decline in the aggregate balance in these deferred accounts during 2008.  Mr. Cloutier’s account declined in value by $609,762 over this period and Ms. Hail’s account declined in value by $391,082.  Dividends paid on the common stock are credited to each account and are used to purchase additional shares of common stock.

(2) EISCP is the Executive Indexed Salary Continuation Plan.  The amounts presented reflect contributions or subtractions from the balances held in the pre-retirement accounts associated with the plan.  There are no credited earnings applied to the balances held in these preretirement accounts.  We also present the amounts contributed to these plans in the supplemental table on All Other Compensation provided in the footnotes to the Summary Compensation Table.
___________________

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POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE OF CONTROL

This section discusses the incremental compensation that would be payable by the Company to each NEO in the event of his or her termination of employment under various scenarios (“termination events”) including voluntary resignation, involuntary termination, termination without cause or for Good Reason in connection with a change in control, termination in the event of disability, termination in the event of death, and termination in the event of retirement. In accordance with applicable SEC rules, the following discussion assumes:

(i) that the termination event in question occurred on December 31, 2008; and
(ii) with respect to calculations based on our stock price, we used $12.75, which was the reported closing price of one share of our common stock on December 31, 2008, the last business day of 2008.

Pursuant to applicable SEC rules, the analysis contained in this section does not consider or include payments made to a NEO with respect to contracts, agreements, plans or arrangements to the extent they do not discriminate in scope, terms or operation, in favor of executive officers and senior management although we have not in fact granted any optionsthat are available generally to Messrs. Cloutier, Hail and Landry for several years, andall salaried employees, such as our 401(k) Plan.  The actual amounts that would be paid upon a NEOs termination of employment can only a modest number of options to our other executive officers. These options are always based on the current stock pricebe determined at the time they are awarded.of such executive officer’s termination.  Due to the number of factors that affect the nature and amount of any compensation or benefits provided upon the termination events, any actual amounts paid or distributed may be higher or lower than reported below.  Factors that could affect these amounts include the timing during the year of any such event and our stock price.

All outstanding stock options granted pursuant to our Stock Incentive Plan automatically become fully exercisable upon a change in control of us, as defined in the plan document. Upon termination for cause, all executives forfeit any balances in pre-retirement accounts and any cash severance payments.  We present details for the other termination scenarios below.

C.R. Cloutier
Upon voluntary resignation, Mr. Cloutier receives the balance in his pre-retirement account paid out in equal annual installments over a ten-year period beginning at the age of 65.  The executives can only benefit by increasingvalue presented in the long termtable is the present value of this benefit.

In the stock.event of involuntary termination without cause, Mr. Cloutier receives the balance in his pre-retirement account paid out in equal annual installments over a ten-year period beginning at the age of 65.  The value presented in the table is the present value of this benefit.
Personnel
In the event of termination without cause or for good reason in connection with a change-in-control, Mr. Cloutier will receive the benefit specified under the terms of his Executive Indexed Salary Continuation Plan as if he had been continuously employed until his normal retirement age of 65.  The value presented in the table is the present value of this benefit.

Upon death, Mr. Cloutier’s beneficiaries will receive the benefit as defined under his supplemental life insurance policy and 80% of the death benefit of the whole life policy associated with the Executive Indexed Salary Continuation Plan.  In addition, his beneficiaries will receive a lump-sum

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payment of the unpaid accrued benefit balance in his pre-retirement account associated with the Executive Indexed Salary Continuation Plan.

Upon long-term disability, Mr. Cloutier will receive the benefit presented in the table as specified under his supplemental long-term disability policy.  Mr. Cloutier also receives the balance in his pre-retirement account paid out in equal annual installments over a ten-year period beginning at the age of 65.  The value presented in the table is the present value of this benefit.

Karen L. Hail
Upon voluntary resignation, Ms. Hail receives the balance in her pre-retirement account paid out in equal annual installments over a ten-year period beginning at the age of 65.  The value presented in the table is the present value of this benefit.

Ms. Hail will receive a lump sum equal to one times base salary in the event of involuntary termination without cause.  In addition to the cash severance, Ms. Hail receives the balance in her pre-retirement account paid out in equal annual installments over a ten-year period beginning at the age of 65.

In the event of a termination without cause or for good reason in connection with a change-in-control, Ms. Hail will receive one times base salary payable in equal installments over 12 months.  She will also receive the benefit specified under the terms of her Executive Indexed Salary Continuation Plan as if she had been continuously employed until her normal retirement age of 65.  The value presented in the table is the present value of this benefit.

Upon death, Ms. Hail’s beneficiaries will receive the benefit as defined under her supplemental life insurance policy and 80% of the death benefit of the whole life policy associated with the Executive Indexed Salary Continuation Plan.  In addition, her beneficiaries will receive a lump-sum payment of the unpaid accrued benefit balance in her pre-retirement account associated with the Executive Indexed Salary Continuation Plan.

Upon long-term disability, Ms. Hail will receive the benefit presented in the table as specified under her supplemental long-term disability policy.  Ms. Hail also receives the balance in her pre-retirement account paid out in equal annual installments over a ten-year period beginning at the age of 65.  The value presented in the table is the present value of this benefit.

J. Eustis Corrigan, Jr.
On January 15, 2009, Mr. Corrigan terminated employment with us via a voluntary resignation.  Mr. Corrigan received no benefit or payout in connection with this termination event, consistent with the presentation in the table on potential payments upon post-termination which follows this narrative.  Although the termination event was known and had occurred prior to the filing of this document, SEC guidelines require the disclosure of all potential payments upon post-termination under all scenarios upon which a benefit may be received for employees serving as our principal financial officer.  Therefore we provide the description of all termination scenarios for Mr. Corrigan in the narrative, and present the amounts in the table summarizing the potential payment values for all of our NEOs.

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In the event of a termination without cause or for good reason, in connection with a change-in-control, Mr. Corrigan will receive two times the total of base salary payable and incentives earned in the prior year under the Company’s annual incentive plan.  The payments will be made in equal installments over 24 months.

In addition, per the terms of the Stock Incentive Plan, all unvested options will immediately vest and become exercisable in connection with a change-in-control.  Mr. Corrigan is not eligible for any other forms of compensation.

Donald R. Landry
We are not contractually obligated to provide Mr. Landry with a cash severance payment upon termination.  Upon voluntary resignation or involuntary termination without cause, Mr. Landry receives the balance in his pre-retirement account paid out in equal annual installments over a ten-year period beginning at the age of 65.  The value presented in the table is the present value of this benefit.

In the event of termination without cause or for good reason in connection with a change-in-control, Mr. Landry will receive the benefit specified under the terms of his Executive Indexed Salary Continuation Plan as if he had been continuously employed until his normal retirement age of 65.  The value presented in the table is the present value of this benefit.

Upon death, Mr. Landry’s beneficiaries will receive the benefit as defined under his supplemental life insurance policy and 80% of the death benefit of the whole life policy associated with the Executive Indexed Salary Continuation Plan.  In addition, his beneficiaries will receive a lump-sum
payment of the unpaid accrued benefit balance in his pre-retirement account associated with the Executive Indexed Salary Continuation Plan.

Upon long-term disability, Mr. Landry will receive the benefit presented in the table as specified under his supplemental long-term disability policy.  Mr. Landry also receives the balance in his pre-retirement account paid out in equal annual installments over a ten-year period beginning at the age of 65.  The value presented in the table is the present value of this benefit.

A. Dwight Utz
We are not contractually obligated to provide Mr. Utz with a severance payment upon termination; however, he will receive benefits under the Company’s Stock Incentive Plan in the event of a change in control (no termination requirement applies).  Per the terms of the Stock Incentive Plan, all unvested options will immediately vest and become exercisable in connection with a change-in-control.  There is no termination requirement placed upon the acceleration of the vesting.  As of December 31, 2008, all unvested options held by Mr. Utz had strike prices that exceeded the market price of a share of our stock and therefore all unvested options had no intrinsic value at that time.

The table below indicates the amount of compensation payable to each NEO, including cash severance, insurance benefits, indexed salary continuation benefits, and stock option awards, as applicable upon different termination events.  The amounts shown assume a termination date of December 31, 2008 and present total amounts for each scenario.  In addition to providing the total benefit for each NEO as of December 31, 2008, we also provide an estimate of the impact of current TARP guidelines on post-termination benefits. We base the estimates on our interpretation of the TARP rules pursuant to the ARRA. According to the language of the ARRA, payments associated with a termination of service are prohibited with the exception of benefits already earned or accrued.

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Potential Payments Upon Termination or Change-in-Control
Compensation and/or Benefits Payable Upon Termination Early Retirement/ Voluntary Resignation  Involuntary Termination for Cause  Involuntary Termination without Cause  Termination in Connection with a Change in Control (without Cause or for Good Reason)  Termination in the Event of Disability  
Termination
in the Event
of Death
 
C.R. Cloutier                  
Supplemental Life Insurance Death Benefit $0  $0  $0  $0  $0  $400,000 
Supplemental Long-Term Disability Benefit(1)
 $0  $0  $0  $0  $154,747  $0 
Executive Indexed Salary Continuation Benefit(1)
 $55,407  $0  $55,407  $82,540  $55,407  $78,197 
Split-Dollar Life Insurance $0  $0  $0  $0  $0  $483,151 
Intrinsic Value of Unvested Stock Options(2)
 $0  $0  $0  $0  $0  $0 
Total $55,407  $0  $55,407  $82,540  $210,154  $961,348 
Total Allowable Per ARRA Restrictions $55,407   --  $55,407  $55,407  $210,154  $961,348 
J. Eustis Corrigan Jr.                        
Cash Severance Payment $0  $0  $0  $453,418  $0  $0 
Intrinsic Value of Unvested Stock Options(2)
 $0  $0  $0  $0  $0  $0 
Total $0  $0  $0  $453,418  $0  $0 
Total Allowable Per ARRA Restrictions  --   --   --  $0   --   -- 
Karen L. Hail                        
Cash Severance Payment $0  $0  $157,000  $157,000  $0  $0 
Supplemental Life Insurance Death Benefit $0  $0  $0  $0  $0  $500,000 
Supplemental Long-Term Disability Benefit(1)
 $0  $0  $0  $0  $673,746  $0 
Executive Indexed Salary Continuation Benefit(1)
 $30,860  $0  $30,860  $90,181  $30,860  $64,875 
Split-Dollar Life Insurance $0  $0  $0  $0  $0  $653,377 
Intrinsic Value of Unvested Stock Options(2)
 $0  $0  $0  $0  $0  $0 
Total $30,860  $0  $187,860  $247,181  $704,606  $1,218,252 
Total Allowable Per ARRA Restrictions $30,860   --  $30,860  $90,181  $704,606  $1,218,252 
Donald R. Landry                        
Supplemental Life Insurance Death Benefit $0  $0  $0  $0  $0  $588,000 
Supplemental Long-Term Disability Benefit(1)
 $0  $0  $0  $0  $736,683  $0 
Executive Indexed Salary Continuation Benefit(1)
 $23,017  $0  $23,017  $90,327  $23,017  $55,100 
Split-Dollar Life Insurance $0  $0  $0  $0  $0  $623,298 
Intrinsic Value of Unvested Stock Options(2)
 $0  $0  $0  $0  $0  $0 
Total $23,017  $0  $23,017  $90,327  $759,700  $1,266,398 
Total Allowable Per ARRA Restrictions $23,017   --  $23,017  $23,017  $759,700  $1,266,398 
A. Dwight Utz                        
Intrinsic Value of Unvested Stock Options(2)
 $0  $0  $0  $0  $0  $0 
Total $0  $0  $0  $0  $0  $0 
Total Allowable Per ARRA Restrictions  --   --   --   --   --   -- 
(1)  Present value of benefit calculated based on a discount of 120% of the appropriate semiannually compounded AFR rate as of December 2008 for each NEO: 1.63% for Mr. Cloutier, 3.40% for Ms. Hail and Mr. Landry.
(2)  As of 12/31/2008 all unvested options had an exercise price exceeding the 12/31/2008 closing price of $12.75, therefore there is no intrinsic value reported for the acceleration of unvested stock options.
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COMPENSATION OF DIRECTORS

A majority of our Directors are also Directors of the Bank.  Directors are entitled to fees of $750 per month for Board service and $250 per month for Bank Board service. The Chairman receives an additional $900 per month, the Vice Chairman an additional $450 per month, and the Audit Committee Chairman an additional $800 per month.  Each Director also receives $500 for each regular meeting and $500 for each special meeting of the Board, $200 for the first hour, and $100 per hour for each additional hour of each committee meeting of the Board.  Each Director also receives $500 for each regular meeting, $500 for each special meeting of the Board of MidSouth Bank, N.A., $200 for the first hour, and $100 per hour for each additional hour of each committee meeting.  Directors receive meeting fees only for meetings they attend.
Will G. Charbonnet Sr.
James R. Davis, Jr.
J. B. Hargroder, MD
Joseph V. Tortorice, Jr.
Summary of
Board Fee Schedule
 
Monthly Board Service Fee (Retainer) 
Holding Company Board $750 
Bank Board $250 
Additional Monthly Fees (Retainer) per Responsibility 
Board Chair $900 
Board Vice-Chair $450 
Audit Committee Chair $800 
Holding Company Board Meeting Fees 
Regular Board Meetings $500 
Special Board Meetings $500 
Committee Meetings    
First Hour $200 
Amounts Per Additional Hour $100 
Bank Board Meeting Fees    
Regular Board Meetings $500 
Special Board Meetings $500 
Committee Meetings    
First Hour $200 
Amounts Per Additional Hour $100 

Director’s Deferred Compensation Plan
We have a Deferred Compensation Plan for members of the Board, administered by the Executive Committee of the Board.  To participate in the Plan, the Director executes a Deferral Authorization form in which the Director agrees to defer all or a specified percentage of his/her fees payable for the services as a member of the Board or a participating subsidiary.  As of the last day of each calendar month, fees deferred are credited to the account and are used to purchase our common stock.  Dividends paid on the common stock are credited to each account and are used to purchase additional shares of common stock. Amounts in each Director’s account are distributed in a single lump sum either (i) 60 days after the later of the Director ceasing to be a member of the Board, or the Director attaining age 65 or (ii) in the sole discretion of the Board not earlier than one year after (i) reasonable conditions as established by the Board are satisfied, the Director ceases to be a member of the Board, and the Director requests payment.

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2008 Board of Director Structure and Activity
In the following table, we provide a summary of the structure of our Board  along with the number of meetings held by the holding company board, bank board, and various standing committees.  The table includes both our outside and employee directors.
 
Committees of the Board (2)
Director
Employee
of the
Company
Holding
Company
Board
Bank
Board
AuditCompExecNomCorp Gov
Will Charbonnet Sr.NoChairChairMemberChairChairMemberMember
James R. Davis Jr.NoLeadMemberChairMember   
J.B. Hargroder, M.D.NoVice-ChairVice-Chair MemberMemberChairChair
Clayton Paul HilliardNoMemberMemberMember  MemberMember
Milton B. Kidd III, O.D.NoMemberMemberMember    
Timothy J. LemoineNoMemberMember     
Stephen C. May (1)
NoMemberMember     
R. Glenn PumpellyNoMemberMember  Member  
William M. SimmonsNoMemberMember   MemberMember
Joseph V. Tortorice, Jr.NoMemberMember MemberMember  
C.R. CloutierYesMemberMember  Member  
Karen L. HailYesMemberMember     
Total Members as of 12/31/2008111144544
Number of Meetings Held During 200812101041011

(1)  Resigned from the Board on February 1, 2008.
(2)  “Audit” – Audit Committee; “Comp” – Compensation Committee; “Exec” – Executive Committee; “Nom” – Nominating Committee; “Corp Gov” – Corporate Governance

The Director Compensation Table provided on the following page displays the total compensation awarded to, earned by or paid to Directors for the fiscal year ending December 31, 2008. Directors who are also NEOs are not included in the table below. Compensation paid to NEOs for their service as Directors is presented in the supplementary tables on “All Other Compensation” which follow the Summary Compensation Table presented earlier in this proxy. All amounts in the following table are in dollars.
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Directors Compensation
Name 
Fees
Earned or
Paid in
Cash
  
Stock
Awards
  
Option
Awards
  
Non-Equity Incentive
Plan Compensation
  
Change in Pension Value
and Nonqualified Deferred Compensation Earnings
  
All Other Compensation (2)
  Total 
(a) (b)  (c)  (d)  (e)  (f)  (g)  (h) 
Will Charbonnet, Sr. $57,600  $0  $0  $0  $0  $0  $57,600 
James R. Davis, Jr. $43,870  $0  $0  $0  $0  $0  $43,870 
J.B. Hargroder, M.D. (3)
 $55,695  $0  $0  $0  $0  $0  $55,695 
Clayton Paul Hilliard $31,700  $0  $0  $0  $0  $0  $31,700 
Milton B. Kidd, III, O.D. $31,500  $0  $0  $0  $0  $0  $31,500 
Timothy J. Lemoine $37,200(5) $0  $0  $0  $0  $0  $37,200 
Stephen C. May (4)
 $5,700  $0  $0  $0  $0  $0  $5,700 
R. Glenn Pumpelly $37,900  $0  $0  $0  $0  $0  $37,900 
William M. Simmons (3)
 $47,690  $0  $0  $0  $0  $0  $47,690 
Joseph V. Tortorice, Jr. (3)
 $29,225  $0  $0  $0  $0  $0  $29,225 
(1)In 1997, non-employee directors were given options to buy up to 20,736 shares of stock at $3.53 per share, the fair market value on the date of grant, all of which have been exercised.  No stock or option awards were provided in 2008.
(2)Certain directors receive perquisites such as travel reimbursement; however, the aggregate amount of such compensation is less than $10,000 and therefore is not reported.
(3)Includes director fees paid by MidSouth-Texas.
(4)Resigned from the Board on February 1, 2008.
(5)Includes $37,200 in fees deferred into the Director’s Deferred Compensation Plan used to purchase 2,807 shares of our common stock.
(6)Includes $22,410 in fees deferred into the Director’s Deferred Compensation Plan used to purchase 1,691 shares of  our common stock.
___________________

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AUDIT COMMITTEE REPORT

Our Audit Committee is composed of fivefour non-employee directors.  The Board has made a determination that its members satisfy AMEX’sNYSE Amex’s requirements as to independence, financial literacy and experience. The Board has also determined that it is not clear whether any member of the Committee is a “Financial Expert” within the meaning of SEC Rules, but the Board does not feel a Financial Expert necessary in view of the overall financial sophistication of Committee members. The responsibilities of the Committee are set forth in our Audit Committee Charter.

The Committee reviewed and discussed the audited financial statements with management including a discussion of the quality of the accounting principles, the reasonableness of significant judgments and the clarity of disclosures contained in the financial statements.  The Committee also discussed with the independent auditors the matters required to be discussed by SAS 61 (Codification of Statements on Auditing Standards, AU Section 380).  The Committee also received the written disclosures and the letter from the independent auditors required by Independent Standards Board Standard No. 1 (Independent Standards Board Standard No. 1, Independence Discussions with Audit Committees), has discussed with the independent auditors the independent

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auditors’ independence and has considered the compatibility of non-audit services with the auditors’ independence.

The Committee discussed with our internal and independent auditors the overall scope and plans for their respective audits.  The Committee met with the internal and independent auditors, with and without management present, to discuss the results of their examinations, their evaluations of our internal controls, and the overall quality of our financial reporting.

Based on the reviews and discussions referred to above, the Committee recommended to the Board that the audited financial statements be included in our Annual Report on Form 10-K for the year ended December 31, 20052008 for filing with the SEC.
 By the members of the Audit Committee:
James R. Davis, Jr.
Will Charbonnet, Sr.
Clayton Paul Hilliard
Milton B. Kidd, III, O.D.
 By the members of the Audit Committee:
James R. Davis, Jr.
Will G. Charbonnet, Sr.
Clayton Paul Hilliard
Milton B. Kidd, III, O.D.
Stephen C. May
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RELATIONSHIP WITH INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS
General
Principal Accountant
 Our consolidated

The Audit Committee of the Board of Directors has appointed the firm of Porter Keadle Moore, LLP independent certified public accountants, to serve as our principal auditors and to perform the audit of the financial statements for 2005 were auditedthe fiscal year ending December 31, 2009.

Representatives of Porter Keadle Moore, LLP will be present at the meeting, will have an opportunity to make a statement if they so desire, and will be available to respond to appropriate shareholder questions.

Fees and Services

During the period covering the fiscal years ended December 31, 2008 and 2007, Porter Keadle Moore, LLP performed the following professional services:

 
 
Description
 
2008 
 
2007
 
 Audit Fees$240,192254,778 
      
 Audit-Related Fees$-- 
      
 Tax Fees$-- 
      
 All Other Fees$-- 
Audit Fees include aggregate fees billed for professional services rendered by Porter Keadle Moore, LLP (“PKM”) and for 2004 and 2003 by Deloitte & Touche LLP (“Deloitte”). On August 18, 2005, the Audit Committee approved the dismissal of Deloitte as our independent accountants and the appointment of PKM as our new independent accountants.
     In connection with the audits for 2003 and 2004, and the subsequent interim period through August 18, 2005, there were no disagreements with Deloitte on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedures, which disagreements if not resolved to their satisfaction would have caused them to make reference in connection with their opinion to the subject matteraudit of the disagreement. TheirCompany’s annual consolidated financial statements for the years ended December 31, 2008 and 2007, including the audit reports also did not contain any adverse opinion or disclaimer of opinion, nor were they qualified or modified as to uncertainty, audit scope, or accounting principles. Deloitte provided a letter of concurrence, pursuant to Item 304(a)(3) of Regulation S-K, stating agreement with the above statements as an exhibit to the required Form 8-K filed by us on August 24, 2005.

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Fees
     The following table summarizes the fees billed to us by our auditors for professional services rendered in 2005 and 2004. Allinternal control over financial reporting; review of the services were pre-approved by the Audit Committee to the extent required under applicable law and in accordance with the provisions of the Audit Committee charter.
                 
  Year-ended December 31,
  2005     2004  
Fee Category Amount % Amount %
   
Audit fees                
Deloitte & Touche LLP  —      $89,600   100%
Porter Keadle Moore LLP  85,827   42%        
                 
All other fees  119,749   58%  —   — 
   
                 
Total fees $205,576   100% $89,600   100%
   
     Audit fees include fees associated with the required annual audit and report on Form 10K, reviews10-K; and review of our quarterly condensed consolidated financial statements included in periodic reports on Form 10Q and services that are normally performed by the external independent auditor in connection with regulatory filings required by the SEC. Audit fees for Deloitte in 2004 included fees for a consent in connection with a Form S-4 regarding the Company’s acquisition of Lamar Bancshares, Inc.
     All other fees include the fees billed for all other services, including for consultation and assistance related to controls documentation in contemplation of compliancefiled with the provisionsSEC, including out of Section 404 of the Sarbanes-Oxley Act of 2002. The Audit Committee has determined that the rendering of non-audit professional services, as identified above, is compatible with maintaining the independence of our auditors. PKM and Deloitte do not perform tax preparation services for us.pocket expenses.

Pre-Approval Policy

The Audit Committee’s policy is to pre-approve all audit and permissible non-audit services provided by the independent auditors.  These services may include audit services, audit-related services, tax services and other services.  Pre-approval is generally provided for up to one year and any pre-approval is detailed as to the particular service or category of services and is generally subject to a specific budget.  The independent auditors and management are required to periodically report to the Audit Committee regarding the extent of services provided by the independent auditors in accordance with this pre-approval, and the fees for services performed to date.  The Audit Committee may also pre-approve particular services on a case-by-case basis. For 2005, pre-approved non-audit services included only those services described above for “All Other Fees.” No non-audit services were performed by the independent auditors in 2004.

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ANY SHAREHOLDER MAY BY WRITTEN REQUEST OBTAIN WITHOUT CHARGE A COPY OF OUR ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 2005,2008, WITHOUT EXHIBITS.  REQUESTS SHOULD BE ADDRESSED TO SALLY D. GARY, INVESTOR RELATIONS, P. O. BOX 3745, LAFAYETTE, LOUISIANA 70502.
By Order of the Board of Directors
Karen L. Hail
Secretary
Lafayette, Louisiana
April 17, 2006

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1.Election of Class I Directors
Nominees:C. R. Cloutier
J. B. Hargroder
William M. Simmons
   
  ___FOR all nominees listed except as marked to
By order of the contrary
Board of Directors
 
  ___Karen L. Hail WITHHOLD authority for all nominees
  SEVP/Chief Operating Officer
  Secretary to the Board 
    If you wish to withhold authority to vote for certain of the nominees listed, strike
through the nominee(s) names.
2.In their discretion, to vote upon such other business as may properly come before the meeting or any adjournment thereof.
This proxy will be voted as specified. If no specific directions are given, this proxy will be voted FOR the nominees named.
Please sign exactly as name appears on the certificate or certificates representing shares to be voted by the proxy. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If a corporation, please sign in full corporate name by president or other authorized persons. If a partnership, please sign in partnership name by authorized persons.
Dated:2006
Signature of Shareholder
Lafayette, Louisiana
April 22, 2009

Signature (if jointly owned)
PLEASE MARK, SIGN, DATE AND RETURN
THIS PROXY CARD TO THE COMPANY
PROMPTLY USING THE ENCLOSED ENVELOPE.

PROXY
MIDSOUTH BANCORP, INC.
May 17, 2006
Annual Meeting of Shareholders
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
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The undersigned hereby appoints Sammy Baudoin, Barbara Hightower, Ray Mikolajczyk or any of them, proxies of the undersigned, with full power of substitution, to represent the undersigned and to vote all of the shares of Common Stock of MidSouth Bancorp, Inc. (the “Company”) that the undersigned is entitled to vote at the annual meeting of the shareholders of the Company to be held on May 17, 2006 and at any and all adjournments thereof.