UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

___________________________

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

___________________________

Date of Report (Date of Earliest Event Reported): ~~August~~November 178, ~~2005~~2006

ALLIED BANCSHARES, INC.

(Exact Name of Registrant as Specified in Charter)

Georgia	~~000~~333-~~51269~~109462	92-0184877
(State of Incorporation)	(Commission File No.)	(IRS Employer Identification No.)

~~1700~~1800 Market Place Boulevard, Cumming, Georgia 30041

(Address of Principal Executive Offices, including Zip Code)

(770) 888-0063

(Registrant’s Telephone Number, including Area Code)

(Former Name, if Changed Since Last Report)

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 (see General Instruction A.2. below):

[ ]	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ]	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ]	Pre-commencement communications pursuant to Rule 14d2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ]	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e4(c))

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Item 81.01. ~~Other~~Amendment ~~Matters.~~to Material Definitive Agreement

On ~~August~~November 178, ~~2005~~2006,Allied ~~the~~Bancshares, ~~Board~~Inc. ~~of Directors of~~ (the “registrant”), ~~approved~~its asubsidiary, ~~plan~~First toNational ~~reclassify~~Bank aof ~~portion~~Forsyth ofCounty ~~its~~(the ~~common~~“bank”), ~~stock~~and Sam R. ~~The~~ ~~transaction~~Story, ~~will~~III, ~~provide~~Executive ~~for~~Vice ~~the~~President ~~reclassification~~and ofChief ~~shares~~Lending Officer of the registrant’s ~~common~~and ~~stock held by shareholders who are~~ the ~~record holders of 1~~bank,~~000~~ orexecuted ~~fewer~~an ~~shares~~amendment ~~into shares of preferred stock~~ to ~~be issued on~~ the ~~basis~~Employment ofAgreement, ~~one~~dated ~~share~~as of ~~preferred~~July 25, ~~stock~~2003, ~~for~~among ~~each~~Sam ~~share of common stock held by such shareholders~~R. ~~The~~ ~~transaction~~Story, isIII, ~~designed to enable~~ the registrant toand ~~terminate its reporting obligations under~~ the ~~Securities Exchange Act of 1934~~bank. ~~The~~A ~~transaction~~copy ~~requires the approval by shareholders holding a majority~~ of the ~~outstanding~~Amendment ~~common~~to ~~stock~~Employment ofAgreement ~~the~~is ~~registrant. Before~~attached ~~the end of the year, the registrant intends~~ to ~~hold~~this aForm ~~special~~8-K ~~meeting~~Current ofReport ~~shareholders~~as ~~for~~Exhibit ~~the shareholders to vote on the transaction~~10.1.

2The Amendment modifies Mr. Story’s Employment Agreement regarding his benefits if he terminates his employment for certain reasons following a change of control.

~~SIGNATURES~~The Amendment provides that if there is a merger, sale, or other change of control of the registrant and Mr. Story terminates his employment due to a material change of duties, a material reduction of his compensation, or a relocation of his principal business office by more than 10 miles, or the registrant terminates Mr. Story without cause within a twelve (12) month period following a change of control, Mr. Story shall be entitled to the following:

~~Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.~~(1)

~~August~~A ~~19,~~payment ~~2005~~equal ~~ALLIED~~to ~~BANCSHARES,~~his ~~INC.~~base ~~By:~~salary ~~s/Andrew~~for K.twelve ~~Walker~~(12) ~~Andrew K. Walker Vice Chairman and Chief Executive Officer~~months;

3(2)

A cash payment for each vacation day which Mr. Story has not used during the calendar year in which occurs the effective date of termination, which amount shall be determined based on a daily rate of Mr. Story’s base salary assuming two hundred sixty (260) business days in such year;

(3)

Any unvested stock options held by Mr. Story will become fully vested and exercisable as of the effective date of termination; and

(4)

Payment to Mr. Story of an amount equal to his cost of COBRA health continuation coverage for Mr. Story under the registrant’s group health plan for a period of twelve (12) months from the termination date.

At the sole discretion of the registrant, the above described severance compensation described in paragraphs (1), (2) and (4) above may be paid to Mr. Story in a single lump sum payment within fifteen (15) days after the termination date, or alternatively, the registrant may elect to make such payments on the first day of each month for twelve months (12) months following the termination date.

In addition, the Amendment provides that in the event of termination of Mr. Story’s employment after a change of control where he is entitled to the above benefits, for a period of twelve (12) months following such termination of Mr. Story’s employment, Mr. Story may not (i) solicit customers of the registrant or its subsidiary bank for the purpose of providing financial services competitive with those provided by the registrant or its subsidiary bank or (ii) solicit employees of the registrant or its subsidiary bank for employment by an employer providing products or services competitive with the business of the registrant or its subsidiary bank. Also, the Amendment clarifies that Mr. Story may not at any time furnish, use or divulge to anyone any confidential information or trade secrets acquired by him from the registrant or its subsidiary bank.

Item 9.01.

Financial Statements and Exhibits.

(c)

Exhibits.

Exhibit Number

Sequential Page Number

10.1

Amendment to Employment Agreement of Sam Story

SIGNATURES

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

November 13, 2006

ALLIED BANCSHARES, INC.

By: s/Andrew K. Walker

Andrew K. Walker

Vice Chairman and Chief Executive

Officer

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