SecProbe.io

<DOCUMENT>
<TYPE>CORRESP
<SEQUENCE>1
<FILENAME>filename1.txt
<TEXT>
POWELL                                              Atlanta     -     Washington
 GOLDSTEIN LLP

                                                      RESIDENT IN ATLANTA OFFICE
                                                     DIRECT DIAL: (404) 572-6904
                                                          LSCHROEDER@POGOLAW.COM

                                October 17, 2005

Securities and Exchange Commission
100 F Street, N.E.
Washington, D.C. 20549
Attn: Jessica Livingston

     Re:  First Southern Bancorp
          Schedule 13E-3
          Filed September 1, 2005
          File No. 005-80820

          Preliminary Proxy Statement on Schedule 14A
          Filed September 1, 2005
          File No. 000-50259

          Amendment No. 1 to Form 10-KSB
          Filed April 26, 2005
          File No. 000-50259

Ladies and Gentlemen:

     On behalf of our client, First Southern Bancorp ("First Southern" or the
"Company"), we are responding to the comments received from your office by
letter dated September 23, 2005 with respect to the above-referenced Schedule
13E-3, Schedule 14A and Amendment No. 1 to Form 10-KSB. We have restated and
responded to each of your comments below. Capitalized terms used in this letter
have the meanings ascribed to them in the Schedule 14A. We have annotated the
marked copy of Amendment No. 2 to the Proxy Statement with cross-references
indicating to which comment we are responding.

General
-------

1.   We note your response to comment 3. Please supplementally provide a formal
     opinion of counsel that the common stock and Series A stock are separate
     classes of securities under Georgia law. In this regard, the analysis
     should include a detailed discussion and comparison of each feature of the
     Series A stock and the common stock and why the rights of each class
     support the opinion of counsel. As an example, the analysis should
     specifically address the fact that the Series A stock is convertible into
     common stock upon a change of control.

     WE HAVE PROVIDED THE REQUESTED OPINION OF COUNSEL AS EXHIBIT 1 TO THIS
     LETTER. PURSUANT TO COUNSEL'S DISCUSSION WITH MR. GOTTLIEB ON OCTOBER 6,
     2005, THE OPINION ONLY ADDRESSES GEORGIA LAW AND DOES NOT ADDRESS SECTION
     12(G)(5) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ANY OTHER FEDERAL LAW.

Preliminary Proxy Statement on Schedule 14A
-------------------------------------------
Summary Term Sheet, page 3
--------------------------

     One Atlantic Center    Fourteenth Floor    1201 West Peachtree Street, NW
                             Atlanta, GA  30309-3488
                     Tel: 404.572.6600    Fax: 404.572.6999
                                 www.pogolaw.com

<PAGE>
POWELL                                        Securities and Exchange Commission
 GOLDSTEIN LLP                                                  October 17, 2005
                                                                          Page 2

2.   Please revise the section entitled "Structure of the Transaction" to
     include the following:
          -    clarify that 87 percent of the shares will not be reclassified
               and will benefit from the reclassification because of several
               reasons including their percentage of ownership will increase;
               and
          -    the number of shares that would be reclassified represent
               approximately thirteen percent of the outstanding shares.

     WE HAVE REVISED THIS SECTION AS REQUESTED.

3.   We note in your response to comment 3 of our letter dated July 25, 2005 you
     characterize the Series A stock as having "substantially different rights
     and limitations with respect to voting, dividends, liquidation and
     redemption." Please include this characterization in your summary term
     sheet (at the outset of your discussion of the terms of the series a
     stock).

     WE ADDED THIS CHARACTERIZATION OF THE SERIES A STOCK AT THE BEGINNING OF
     THE SUMMARY DESCRIPTION OF THE TERMS OF THE SERIES A STOCK.

4.   We note your response to comment 5 of our letter dated July 25, 2005
     regarding the section entitled "Terms of the Series A Stock." Please
     explain in the section on voting rights, the voting rights "provided by
     law" to which you refer.

     WE HAVE REVISED THIS SECTION AND THE SECTION ENTITLED "TERMS OF THE SERIES
     A STOCK TO BE ISSUED IN THE RECLASSIFICATION-VOTING RIGHTS" TO DESCRIBE THE
     MATERIAL VOTING RIGHTS TO WHICH THE HOLDERS OF SERIES A STOCK WILL BE
     ENTITLED UNDER GEORGIA LAW.

5.   We note your response to comment 6 of our letter dated July 25, 2005
     regarding the section entitled "Fairness of the Reclassification." Please
     revise the section as follows:
          -    disclose that the Board did not obtain an appraisal to determine
               if the Series A stock had the same value as the common stock;
          -    modify your statement that "no shareholder will be forced to
               involuntarily liquidate his or her equity interest" since one
               result of the reclassification will be that shareholders of
               Series A stock may be forced to involuntarily liquidate their
               interest pursuant to the terms of the Series A stock; and
          -    clarify your statement that the advantages and disadvantage of
               the Series A stock "balance" those of the common stock to explain
               that this is the opinion of the board.

     WE HAVE REVISED THIS SECTION AS REQUESTED.

6.   We note your response to comment 7 of our letter dated July 25, 2005
     regarding the section entitled "Effectiveness of the Reclassification."
     Please update this information, if warranted by recent exercises of options
     or warrants.

7.   Please expand the section entitled "Dissenters' Rights" to briefly discuss
     how fair value will be calculated. Provide a more detailed description in
     an appropriate section later in the document.

<PAGE>
POWELL                                        Securities and Exchange Commission
 GOLDSTEIN LLP                                                  October 17, 2005
                                                                          Page 3

     WE HAVE BRIEFLY DISCUSSED IN THIS SECTION HOW FAIR VALUE IS DETERMINED
     UNDER THE GEORGIA DISSENTERS' RIGHTS PROVISIONS AND HAVE PROVIDED A CROSS-
     REFERENCE TO THE MORE DETAILED DISCUSSION OF DISSENTERS' RIGHTS WHICH
     APPEARS LATER IN THE DOCUMENT.

Questions and Answers, page 7
-----------------------------

8.   Please revise the answer to the question "What do I need to do now?" to
     include instructions for those who want to assert dissenters' rights.

     WE HAVE REVISED THIS ANSWER TO INCLUDE THE REQUESTED DISCLOSURE.

Alternatives Considered, page 12
--------------------------------

9.   Please provide a detailed explanation in the first paragraph as to why
     reclassification is the simplest and most cost-effective alternative.
     Please comply with Instruction 1 to Item 1013 that "conclusory statements
     will not be considered sufficient disclosure." Please disclose that the
     receipt of cash in the event of either asserting dissenters' rights or
     being subject to a call from the company will also be a taxable event.
     Please disclose, on page 13, the per-share value which management used to
     determine that a cash-out merger could have cost up to $1.7 million.

     WE HAVE DELETED THE STATEMENT THAT THE RECLASSIFICATION IS THE SIMPLEST AND
     MOST COST-EFFECTIVE ALTERNATIVE SINCE WE HAVE EXPLAINED UNDER THE
     DISCUSSION OF EACH ALTERNATIVE WHY THE PARTICULAR ALTERNATIVE WAS REJECTED.
     WE HAVE DISCLOSED UNDER THE "CASH-OUT MERGER" ALTERNATIVE THAT THE RECEIPT
     OF CASH AS A RESULT OF ASSERTING DISSENTERS' RIGHTS OR UPON A CALL OF THE
     SERIES A STOCK WILL BE A TAXABLE EVENT. WE HAVE ALSO DISCLOSED THE
     PER-SHARE VALUE USED TO CALCULATE THE ESTIMATED COST OF A CASH-OUT MERGER.

Background of the Reclassification, page 14
-------------------------------------------

10.  We note your response to comment 11 of our letter dated July 25, 2005. As
     we requested, please revise this section to discuss the conflict of
     interest (using that term) and to disclose those conflicts here or
     cross-reference the section "Effects of Reclassification on Affiliates."

     WE HAVE REVISED THE SECTION TO DISCLOSE THE CONFLICT OF INTEREST AND TO
     PROVIDE A CROSS-REFERENCE TO "EFFECTS OF THE RECLASSIFICATION ON
     AFFILIATES."

11.  Please expand to describe how the board considered and determined the
     features of the Series A stock.

     WE HAVE EXPANDED THE DISCLOSURES TO DISCUSS HOW THE BOARD DETERMINED THE
     TERMS OF THE SERIES A STOCK.

12.  Please revise your discussion of alternatives, on page 16 and elsewhere, to
     discuss the fact that the reclassification does not give all shareholders
     an opportunity to maintain an equity interest because the reclassification
     gives the company the right to call the Series A stock and the
     reclassification may require the company to finance the purchase of shares
     of those who assert dissenters' rights.

<PAGE>
POWELL                                        Securities and Exchange Commission
 GOLDSTEIN LLP                                                  October 17, 2005
                                                                          Page 4

     WE HAVE REVISED THIS DISCUSSION OF ALTERNATIVES AND THE DISCLOSURE UNDER
     THE SECTION ENTITLED "ALTERNATIVES CONSIDERED" TO INDICATE THAT THE COMPANY
     MAY CALL THE SERIES A STOCK. WE HAVE REVISED THESE DISCLOSURES TO INDICATE
     THAT THE COMPANY NOW HAS WORKING CAPITAL OF UP TO $2,000,000 TO PAY
     DISSENTING SHAREHOLDERS AND THE COSTS OF DISSENTERS' PROCEEDINGS OR OTHER
     LITIGATION CHALLENGING THE LEGALITY OF THE RECLASSIFICATION. WE HAVE ALSO
     REVISED THE DISCLOSURE TO INDICATE THAT THE BOARD MAY DECIDE TO ABANDON THE
     RECLASSIFICATION IF IT DETERMINES THESE COSTS MAKE THE RECLASSIFICATION
     INADVISABLE.

13.  We note your response to comment 12 of our letter dated July 25, 2005. As
     we requested, please further explain the basis for your claims, on page 18
     and elsewhere, that the value of the Series A stock is equivalent to the
     value of the common stock. Please revise this section to comply with the
     requirement of Instruction 1 to Item 1013 that "conclusory statements will
     not be considered sufficient disclosure." Please explain how the Board made
     this determination without an appraisal and without any quantitative
     analysis. Please explain how the Board determined that two classes of stock
     are equivalent when they have "substantially different rights and
     limitations with respect to voting, dividends, liquidation and redemption."
     Please also explain your statement that "the cash value of the Series A
     stock is immaterial."

     WE HAVE DELETED ALL STATEMENTS REGARDING THE VALUE OF THE SERIES A STOCK
     SINCE THE BOARD DID NOT UNDERTAKE A QUANTITATIVE ANALYSIS OF THE VALUE OF
     THE SERIES A STOCK.

Reasons for the Reclassification, page 18
-----------------------------------------

14.  We note your response to comment 13 of our letter dated July 25, 2005
     regarding direct and indirect costs. Please revise this disclosure to
     include the potential costs of paying the appraised value of your common
     stock to each shareholder entitled to assert dissenters' rights under
     Georgia law. In addition, please discuss the potential legal fees involved
     in any disputes relating to dissenters' rights and in any litigation
     challenging the legality of the reclassification.

     WE HAVE PROVIDED THE REQUESTED DISCLOSURE UNDER THIS SECTION AND THE
     SECTION ENTITLED "SOURCE OF FUNDS AND EXPENSES."

Effects of the Reclassification on First Southern, page 20
----------------------------------------------------------

15.  We note your response to comment 16 of our letter dated July 25, 2005
     regarding the benefits and detriments to the company. Please revise the
     first paragraph to explain the consequences if your assumption that no
     shareholders will exercise dissenters' rights proves to be false. Please
     discuss, in a separate bullet point, the potential negative effects of
     shareholders exercising dissenters' rights.

     WE HAVE PROVIDED THE REQUESTED DISCLOSURE REGARDING THE ASSUMPTION THAT NO
     SHAREHOLDERS EXERCISE DISSENTERS' RIGHTS AND HAVE ADDED A BULLET POINT
     UNDER "EFFECTS OF THE RECLASSIFICATION ON FIRST SOUTHERN" TO DESCRIBE THE
     NEGATIVE EFFECTS ON FIRST SOUTHERN OF POTENTIAL PAYMENT TO DISSENTING
     SHAREHOLDERS AND UNDER "EFFECTS OF THE RECLASSIFICATION ON SHAREHOLDERS
     WHOSE SHARES ARE RECLASSIFIED" TO DESCRIBE POTENTIAL NEGATIVE EFFECTS TO
     SHAREHOLDERS EXERCISING DISSENTERS' RIGHTS.

<PAGE>
POWELL                                        Securities and Exchange Commission
 GOLDSTEIN LLP                                                  October 17, 2005
                                                                          Page 5

16.  Please revise this disclosure to include the potential costs of paying the
     appraised value of your common stock to each shareholder entitled to assert
     dissenters' rights under Georgia law. Discuss the extent to which you may
     have to incur debt to pay those asserting dissenters' rights. In addition,
     please discuss the potential legal fees involved in any disputes relating
     to dissenters' rights and in any litigation challenging the legality of the
     reclassification.

     WE HAVE PROVIDED THE REQUESTED DISCLOSURE. FIRST SOUTHERN DOES NOT
     ANTICIPATE IT WILL INCUR ANY DEBT TO PAY DISSENTING SHAREHOLDERS. PLEASE
     ALSO SEE THE RESPONSE TO COMMENTS 12 AND 15.

17.  As we requested in comment 17 of our letter dated July 25, 2005, please add
     disclosure addressing the risk that the company may be required to register
     the class of Series A under Section 12(g) of the Exchange Act in the event
     the number of record holders exceeds 500 as of the last day of any fiscal
     year.

     WE HAVE PROVIDED THE REQUESTED DISCLOSURE.

18.  We note your response to comments 15 and 18 of our letter dated July 25,
     2005. Please discuss other detriments (other than short-swing profits) of
     losing the protection of the federal securities laws.

     WE HAVE ADDED A BULLET POINT UNDER "EFFECTS OF THE RECLASSIFICATION ON
     FIRST SOUTHERN-NEGATIVE EFFECTS" TO DESCRIBE THE POTENTIAL NEGATIVE EFFECTS
     OF THE ELIMINATION OF FIRST SOUTHERN'S OBLIGATIONS UNDER SECTION 404 OF THE
     SARBANES-OXLEY ACT. WE HAVE ALSO ADDED A MORE DETAILED DISCUSSION UNDER
     "EFFECTS OF THE RECLASSIFICATION ON UNAFFILIATED SHAREHOLDERS-REDUCTION OF
     PUBLICLY AVAILABLE INFORMATION" OF THE SPECIFIC REPORTS THAT FIRST SOUTHERN
     WILL NO LONGER BE REQUIRED TO FILE WITH THE SEC.

Effects of the Reclassification on Unaffiliated Shareholders, page 24
---------------------------------------------------------------------

19.  Please clarify that this section applies to shareholders whose shares will
     be reclassified and those whose shares will not.

     WE HAVE CLARIFIED THIS SECTION AS REQUESTED.

Effects of the Reclassification on Shareholders Generally, page 24
------------------------------------------------------------------

20.  We note your addition of the section entitled "Shares Exchanged for Series
     A Stock." Please set forth this disclosure in a separately captioned
     section entitled "Effects of the Reclassification on Shareholders Whose
     Shares Are Reclassified." Please move this section after the section
     ad