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<title>8-K Palmetto</title>



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text-align:center'><b>&nbsp;</b></p>

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text-align:center'><b>&nbsp;</b></p>

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text-align:center'><b>UNITED STATES </b></p>

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text-align:center'><b>SECURITIES AND EXCHANGE
COMMISSION</b></p>

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text-align:center'><b>Washington, D. C. 20549</b></p>

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text-align:center'>&nbsp;</p>

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text-align:center'><b>FORM 8-K</b></p>

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text-align:center'>&nbsp;</p>

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text-align:center'>CURRENT REPORT</p>

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text-align:center'>&nbsp;</p>

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text-align:center'>Pursuant to Section 13 or
15(d) of the Securities Exchange Act of 1934</p>

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text-align:center'>&nbsp;</p>

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text-align:center'>Date of Report (Date of
earliest event reported): May 19, 2009</p>

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text-align:center'>&nbsp;</p>

<div align="center">

<table class=MsoNormalTable border=0 cellpadding=0 width=640
 style='width:90%;border-collapse:collapse'>
 <tr>
  <td width="31%" valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>&nbsp;</p>
  </td>
  <td width="35%" valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td colspan=5 valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'><b>Palmetto Bancshares, Inc.</b></p>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>(Exact name of registrant as specified in its
  charter)</p>
  </td>
 </tr>
 <tr>
  <td width="31%" valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width="35%" valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td colspan=2 valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width="22%" valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="31%" valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width="35%" valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td colspan=2 valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width="22%" valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-right:-17.05pt'><u>South Carolina&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u></p>
  </td>
  <td width="35%" valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'><u>&nbsp;&nbsp;&nbsp;&nbsp;
  0-26016&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u></p>
  </td>
  <td width="3%" valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td colspan=2 valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:right'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  74-2235055</u></p>
  </td>
 </tr>
 <tr>
  <td valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>State or other
  jurisdiction of incorporation </p>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width="35%" valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>Commission File Number</p>
  </td>
  <td colspan=3 valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:right'>&nbsp;IRS Employer I.D. number</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width="35%" valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width="3%" valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td colspan=2 valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width="35%" valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width="3%" valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td colspan=2 valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td colspan=2 valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'><u>306 East North Street, Greenville, South Carolina</u></p>
  </td>
  <td width="3%" valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td colspan=2 valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:right'><u>29601</u></p>
  </td>
 </tr>
 <tr>
  <td colspan=2 valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>Address of principal
  executive offices</p>
  </td>
  <td width="3%" valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td colspan=2 valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:right'>Zip Code</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width="35%" valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width="3%" valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td colspan=2 valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td width="35%" valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-right:-15.25pt'>&nbsp;&nbsp;&nbsp;&nbsp; </p>
  </td>
  <td width="3%" valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
  <td colspan=2 valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td colspan=5 valign=top style='padding:0in; '>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>800.725.2265<br>
	</u>Registrant's telephone number </p>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>&nbsp;</p>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>
	<u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; N/A&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
	</u></p>
  <p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:center'>(Former Name or Former Address, if Changed Since
  Last Report</p>
  </td>
 </tr>
 <tr height=0>
  <td width="31%" style='border:none'></td>
  <td width="35%" style='border:none'>&nbsp; </td>
  <td width="3%" style='border:none'></td>
  <td width="6%" style='border:none'></td>
  <td width="22%" style='border:none'></td>
 </tr>
</table>

</div>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.25in'>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 (<i>see</i> General
Instruction A.2. below):</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.25in'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.25in'>[&nbsp; ] Written communications pursuant to Rule 425
under the Securities Act (17 CFR 230.425)</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.25in'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.25in'>[&nbsp; ] Soliciting material pursuant to Rule 14a-12
under the Exchange Act (17 CFR 240.14a-12)</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.25in'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.25in'>[ ] Pre-commencement communications pursuant to Rule
14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.25in'>&nbsp;</p>
<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-align:justify;text-indent:.25in'>[ ] Pre-commencement communications pursuant to Rule
13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))</p>

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<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin:0in;margin-bottom:.0001pt'><b>ITEM
7.01. REGULATION FD DISCLOSURE.</b></p>

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<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>On May 19, 2009, Palmetto
Bancshares, Inc.&#146;s (the &quot;Company&quot;) held its Annual Meeting of
Shareholders.&nbsp; During the meeting, L. Leon Patterson, Chairman and Chief
Executive Officer of the Company, disclosed the following information to
shareholders in attendance:</p>

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<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'><u>New Corporate
Headquarters Opened in Greenville, South Carolina</u></p>

<ul style='margin-bottom:0in;margin-top:0in'>
 <li style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>Building occupied during
     March 2009 and includes executive officers and a branch.</li>
 <li style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>Building includes four
     floors (45,000 square feet) at a cost of approximately $13.7 million
     (including furniture, fixtures, and fees).</li>
 <li style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>The building was built by
     a third party and is leased by The Palmetto Bank (thereby preserving
     capital and liquidity).&nbsp; </li>
 <li style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>Incremental operating
     expenses associated with the facility had little impact on first quarter
     2009 results and were not a factor in the decision by the Board of
     Directors to reduce the first quarter dividend.</li>
</ul>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'><u>&nbsp;</u></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'><u>April 2009 Financial
Information</u></p>

<ul style='margin-bottom:0in;margin-top:0in'>
 <li style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>Year-to-date net income for
     the four month period ended April 30, 2009 of $2.4 million.</li>
 <li style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>Total asset increase of
     over 9% (at April 30, 2009 compared with April 30, 2008).</li>
 <li style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>Total loan growth of 6%
     (at April 30, 2009 compared with April 30, 2008). *</li>
 <li style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>Average month-to-date deposit growth of 11% (for the month
     ended April 30, 2009 compared with the month ended April 30, 2008).</li>
 <li style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>Shareholders&#146; equity of
     $118.7 million (at April 30, 2009).</li>
 <li style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>Well-capitalized in all
     regulatory categories (at April 30, 2009).</li>
</ul>

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<p style='margin-bottom:.0001pt;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>
<font size="2">* This
growth percentage was incorrectly reported at the Annual Meeting of
Shareholders as 5% at April 30, 2009 compared with April 30, 2008. </font> </p>
<p style='margin-bottom:.0001pt;font-family:"Times New Roman"; margin-left:0in; margin-right:0in; margin-top:0in'>
<font size="2">&nbsp;</font></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";'>The information in Item 7.01
is being furnished, not filed.&nbsp; Accordingly, the information in this Item
7.01 will not be incorporated by reference into any registration statement
filed by&nbsp;Palmetto Bancshares, Inc. under the Securities Act of 1933 unless
specifically identified therein as being incorporated therein by
reference.&nbsp; The furnishing of the information in this report is not
intended to, and does not, constitute a determination or admission by Palmetto
Bancshares, Inc. that (i) the information in this report is material or
complete or (ii) investors should consider this information before making an
investment decision with respect to any security of Palmetto Bancshares, Inc.
or any of its affiliates.</p>

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<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";line-height:1.0pt'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";text-autospace:none'><b>SIGNATURES</b></p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-right:-9.0pt;text-align:justify'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-right:-9.0pt;text-align:justify'>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.</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-right:-9.0pt;text-align:justify'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-right:-9.0pt;text-align:justify'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-right:-9.0pt;text-align:justify'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-right:-9.0pt;text-align:justify'>PALMETTO BANCSHARES, INC.</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-right:-9.0pt;text-align:justify'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-right:-9.0pt;text-align:justify'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-right:-9.0pt;text-align:justify'>By:</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-right:-9.0pt;text-align:justify'>&nbsp;</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-top:0in;margin-right:-9.0pt;margin-bottom:0in;margin-left:
0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-top:0in;margin-right:-9.0pt;margin-bottom:0in;margin-left:
0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;<u>/s/
L. Leon Patterson&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</u></p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-top:0in;margin-right:-9.0pt;margin-bottom:0in;margin-left:
0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;L.
Leon Patterson</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-top:0in;margin-right:-9.0pt;margin-bottom:0in;margin-left:
0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;Chairman
and Chief Executive Officer</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-top:0in;margin-right:-9.0pt;margin-bottom:0in;margin-left:
0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-top:0in;margin-right:-9.0pt;margin-bottom:0in;margin-left:
0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-top:0in;margin-right:-9.0pt;margin-bottom:0in;margin-left:
0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Times New Roman";margin-top:0in;margin-right:-9.0pt;margin-bottom:0in;margin-left:
0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-right:-9.0pt;text-align:justify'>Date:&nbsp;&nbsp; May 26, 2009</p>

<p style='margin:0in;margin-bottom:.0001pt;font-size:12.0pt;font-family:"Times New Roman";margin-right:-9.0pt;text-align:justify'>&nbsp;</p>

<p style='margin-right:0in;margin-left:0in;font-size:12.0pt;font-family:"Arial Unicode MS";'><strong>&nbsp;&nbsp;</strong></p>

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8-K Palmetto
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): May 19, 2009
Palmetto Bancshares, Inc.
(Exact name of registrant as specified in its
  charter)
South Carolina
0-26016
74-2235055
State or other
  jurisdiction of incorporation
Commission File Number
IRS Employer I.D. number
306 East North Street, Greenville, South Carolina
29601
Address of principal
  executive offices
Zip Code
800.725.2265
Registrant's telephone number
N/A
(Former Name or Former Address, 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
14d-2(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 240.13e-4(c))
ITEM
7.01. REGULATION FD DISCLOSURE.
On May 19, 2009, Palmetto
Bancshares, Inc.'s (the "Company") held its Annual Meeting of
Shareholders.  During the meeting, L. Leon Patterson, Chairman and Chief
Executive Officer of the Company, disclosed the following information to
shareholders in attendance:
New Corporate
Headquarters Opened in Greenville, South Carolina
Building occupied during
     March 2009 and includes executive officers and a branch.
Building includes four
     floors (45,000 square feet) at a cost of approximately $13.7 million
     (including furniture, fixtures, and fees).
The building was built by
     a third party and is leased by The Palmetto Bank (thereby preserving
     capital and liquidity).
Incremental operating
     expenses associated with the facility had little impact on first quarter
     2009 results and were not a factor in the decision by the Board of
     Directors to reduce the first quarter dividend.
April 2009 Financial
Information
Year-to-date net income for
     the four month period ended April 30, 2009 of $2.4 million.
Total asset increase of
     over 9% (at April 30, 2009 compared with April 30, 2008).
Total loan growth of 6%
     (at April 30, 2009 compared with April 30, 2008). *
Average month-to-date deposit growth of 11% (for the month
     ended April 30, 2009 compared with the month ended April 30, 2008).
Shareholders' equity of
     $118.7 million (at April 30, 2009).
Well-capitalized in all
     regulatory categories (at April 30, 2009).
* This
growth percentage was incorrectly reported at the Annual Meeting of
Shareholders as 5% at April 30, 2009 compared with April 30, 2008.
The information in Item 7.01
is being furnished, not filed.  Accordingly, the information in this Item
7.01 will not be incorporated by reference into any registration statement
filed by Palmetto Bancshares, Inc. under the Securities Act of 1933 unless
specifically identified therein as being incorporated therein by
reference.  The furnishing of the information in this report is not
intended to, and does not, constitute a determination or admission by Palmetto
Bancshares, Inc. that (i) the information in this report is material or
complete or (ii) investors should consider this information before making an
investment decision with respect to any security of Palmetto Bancshares, Inc.
or any of its affiliates.
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.
PALMETTO BANCSHARES, INC.
By:
/s/
L. Leon Patterson
L.
Leon Patterson
Chairman
and Chief Executive Officer
Date:   May 26, 2009