UNITED ~~STATES~~STATESSECURITIES ~~SECURITIES~~ AND EXCHANGE ~~COMMISSION~~COMMISSIONWashington, D.C. 20549

~~Washington,~~ FORM ~~D.C.~~8-KCURRENT REPORTPursuant to ~~20549~~Section 13 or 15(d) of the Securities Exchange Act of 1934Date of ReportMarch 10, 2009

FORM 8-K CURRENT REPORT

Commission
File
Number

Registrant

State of

Incorporation

IRS Employer
Identification
Number

000-51660

CapitalSouth Bancorp

Delaware

63-1026645

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) February 24, 2009

CapitalSouth Bancorp

(Registrant)

Delaware		000-51660		63-1026645
(State or other jurisdiction) of incorporation)		(Commission file number)		(I.R.S. employer identification no.)

2340 Woodcrest Place Birmingham, Alabama	35209
(Address of principal executive offices)	(Zip Code)

(205) 870-1939 (Registrant’'s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o ⃞ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

~~ITEM~~ ⃞ Soliciting material ~~1.01~~pursuant ~~Entry~~to ~~into~~Rule a14a-12 ~~Material~~under ~~Definitive~~the ~~Agreement~~Exchange Act (17 CFR 240.14a-12)

~~On February 24, 2009, CapitalSouth Bancorp (“CapitalSouth”) and James C. Bowen, a director of~~ ~~CapitalSouth (“Bowen”), entered into a Securities Purchase Agreement (the “Purchase Agreement”)~~ ⃞ ~~whereby~~ Pre-commencement communications ~~CapitalSouth~~pursuant ~~and Bowen agreed~~ to ~~restructure~~Rule ~~the CapitalSouth debt held by Bowen evidenced by a note in the original principal amount of $1,500,000~~ 14d-2(~~the “Pledged Note”~~b). ~~The~~under ~~Pledged Note originally was issued to Bowen in connection with~~ the ~~merger~~Exchange ofAct ~~Monticello~~(17 ~~Bancshares, Inc. with~~CFR ~~and into CapitalSouth~~ 240.14d-2(~~the “Merger”~~b)~~. The Securities Purchase Agreement operates to effect the~~) ~~terms of that certain Restructuring Agreement by and between CapitalSouth and Bowen dated September 30, 2008. Under the terms of the Purchase Agreement, the Pledged Note was converted into:~~

~~1. A new promissory note in the original principal amount of $500,000 made by CapitalSouth in~~ ~~favor~~ ⃞ Pre-commencement communications ofpursuant ~~Bowen~~to ~~with~~Rule an13e-4(c) ~~interest~~under ~~rate~~the ofExchange ~~LIBOR~~Act ~~plus two percent~~ (~~2%),~~17 ~~with interest paid quarterly~~CFR 240.13e-4(~~“Bowen Note II”~~c);)

2 Item 3. ~~285,000~~01. Notice ~~shares~~ of ~~CapitalSouth~~Delisting ~~common~~or ~~stock~~Failure ~~at a conversion price of $2.00 per share, which conversion price is equal~~ to ~~the~~Satisfy ~~subscription~~a ~~price~~Continued ~~for the exercise of non-transferable rights~~Listing ~~distributed~~ Rule toor ~~holders~~Standard; ofTransfer ~~CapitalSouth common stock as~~ of ~~September 22, 2008 described in~~Listing. ~~CapitalSouth’s Registration Statement on Form S-1 filed with the SEC on June 11, 2008, as amended through the date hereof; and~~

~~3. A~~ (d) On ~~new~~March ~~convertible~~10, ~~promissory~~2009, ~~note in~~ the ~~original~~Board ~~principal~~of ~~amount~~Directors of ~~$430,000 made by~~ CapitalSouth Bancorp ~~in favor of Bowen with an interest rate of LIBOR plus two percent~~ (2%the “Company”), ~~with~~unanimously ~~interest paid~~voted ~~quarterly,~~to ~~which~~delist ~~note is convertible into shares of CapitalSouth~~ its common stock, atpar avalue ~~conversion price of~~ $21.00 per share (the “~~Bowen~~Common ~~Note III~~Stock”)., from ~~Bowen~~the ~~Note~~NASDAQ ~~III~~Capital ~~may~~Market be(“Nasdaq”) ~~converted~~and ~~into CapitalSouth~~to ~~common~~ voluntarily ~~stock~~terminate ~~if:~~the ~~(i) Bowen~~registration ~~files~~of aits ~~Notice~~Common ofStock ~~Change~~under ~~in Control~~the ~~with~~ Securities ~~the~~Exchange ~~Board~~Act of ~~Governors~~1934, ofas ~~the~~amended. In connection therewith, ~~Federal~~ the ~~Reserve~~Company ~~System~~notified ~~(the~~Nasdaq ~~“FRB”)~~on ~~indicating~~March ~~his~~10, ~~intention~~2009 toof ~~acquire~~the aCompany’s ~~controlling~~intention ~~interest~~ to infile ~~CapitalSouth,~~Form ~~and~~25 ~~(ii) the~~on ~~FRB~~or ~~does~~about ~~not~~March ~~object~~20, to2009. The Company anticipates that the ~~Notice~~Form of25 ~~Change~~will inbecome ~~Control provided~~effective byten ~~Bowen~~(10) days following its filing.

~~Bowen~~ On ~~Note~~or IIabout ~~will~~March ~~replace~~30, 2009, the ~~Pledged~~anticipated ~~Note~~effective asdate ~~security~~of ~~for~~the delisting ~~Bowen~~of the Company’s ~~indemnity~~Common ~~obligations~~Stock ~~for certain~~from ~~losses~~Nasdaq, ~~related~~the Company intends to ~~loans~~file ~~issued~~a ~~and~~Form ~~sold~~15 bywith ~~Monticello~~the ~~Bank~~Securities ~~prior~~and toExchange Commission (the ~~Merger. That~~“SEC”) ~~certain~~ to ~~Non-Recourse~~voluntarily ~~and~~effect ~~Security~~the ~~Agreement~~deregistration ~~dated~~of ~~September 14,~~its ~~2007,~~common ~~between Bowen and~~stock. The ~~CapitalSouth~~ Company ~~Bank,~~is ~~and~~eligible ~~joined~~to inderegister by ~~CapitalSouth~~filing ~~for~~Form ~~limited~~15 ~~purposes~~because it has ~~been~~fewer than ~~amended~~300 byholders ~~an Amendment~~of torecord ~~Non-Recourse~~of ~~Indemnity~~its ~~and~~common ~~Security~~stock. Upon ~~Agreement~~the ~~dated~~filing ~~February 24,~~of ~~2009, between~~the ~~CapitalSouth~~ Form ~~Bank~~15, ~~Bowen,~~the ~~and~~Company’s ~~joined~~obligations into byfile ~~CapitalSouth~~certain (reports with the ~~“Amendment~~SEC, including toForms ~~Indemnity~~10-K, ~~Agreement”)~~10-Q ~~to reflect~~and ~~that~~8-K, ~~Bowen’s~~will ~~total~~immediately ~~liability~~be ~~for~~suspended. The Company ~~certain~~expects ~~losses~~the ~~related~~deregistration to ~~loans~~become ~~issued~~effective ~~and~~ninety ~~sold~~(90) bydays ~~Monticello~~ after ~~Bank~~filing ~~prior to~~ the ~~Merger~~Form is15 ~~now~~with ~~capped~~the ~~at $500,000~~SEC.

~~The descriptions of the Purchase Agreement, Bowen Note II, Bowen Note III and the Amendment to~~ ~~Indemnity Agreement do not purport to be complete, and they are qualified in their entirety by~~ ~~references to the Purchase Agreement, Bowen Note II, Bowen Note III and the Amendment to Indemnity~~ Item ~~Agreement attached hereto as Exhibits 10~~ 9.~~1, 10~~01.2, Financial ~~10.3,~~Statements and 10Exhibits.~~4, respectively, and incorporated~~ ~~herein by reference.~~

~~ITEM 3~~ (d) Exhibits.~~02 Unregistered Sales of Equity Securities~~

~~The information set forth under Items “2” and “3” of “Item 1.01 Entry into a Material~~ ~~Definitive Agreement” is incorporated by reference into this Item 3~~ 99.~~02.~~1* Press ~~The~~Release, ~~issuance~~dated ofMarch ~~the shares of common stock was exempt from registration pursuant to Section 4(2) of the Securities Act of 1933~~10, ~~as amended~~2009.

~~ITEM~~ * Filed 5herewith.~~02 Departure of Directors or Certain Officers; Election of Directors;~~ ~~Appointment of Certain Officers; Compensatory Arrangements of Certain Officers~~

On February 25, 2009, Dr. Robert L. Baldwin notified the Board of Directors of CapitalSouth of his intent to voluntarily resign as a director of CapitalSouth’s Board of Directors effective March 1, 2009. Dr. Baldwin’s resignation from CapitalSouth’s Board of Directors is not the result of any disagreement between CapitalSouth and Dr. Baldwin concerning Dr. Baldwin personally or any matter relating to CapitalSouth’s operations, policies or practices.

ITEM 9.01 Financial Statements and Exhibits

(d)	Exhibits
	10.1	Securities Purchase Agreement dated February 24, 2009.
	10.2	$500,000 Promissory Note dated February 24, 2009.
	10.3	$430,000 Convertible Promissory Note dated February 24, 2009.
	10.4	Amendment to Non-Recourse Indemnity and Security Agreement dated February 24, 2009.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the ~~registrant~~ registrant has duly caused this report to be signed on its behalf by the undersigned ~~thereunto~~hereunto duly authorized.

	CAPITALSOUTH BANCORP
March 2, 2009	By:	/s/ Carol W. Marsh
March 10, 2009	By: /S/ W. Dan Puckett
	Carol W. Marsh Senior Vice President, Secretary and Chief Financial Officer
	W. Dan Puckett
	Chief Executive Officer

EXHIBIT INDEX

Exhibit Number	Exhibit

99.1*	Press Release, dated March 10, 2009.

* Filed herewith.

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