BANK OF FOUR OAKS
EXECUTIVE EMPLOYMENT AGREEMENT
THIS AGREEMENT is entered into as of this 1st day of January, 1989 by and
between BANK OF FOUR OAKS, a North Carolina banking corporation (the "Bank"),
and Ayden R. Lee, Jr. ("Employee").
W I T N E S S E T H
WHEREAS, the Bank desires that Employee become an employee of the Bank to
serve as its Chief Executive Officer; and
WHEREAS, Employee desires to become an employee of the Bank and to serve as
the Bank's Chief Executive Officer;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants contained in this Agreement, the Bank and Employee agree as follows:
1. Employment. Commencing on the date of this Agreement, Employee is
employed by the Bank as its Chief Executive Officer with the duties,
responsibilities and powers of such office as assigned to him as of the date of
this Agreement and as customarily associated with such office.
2. Term. The term of this Agreement shall commence on the date of this
Agreement and shall terminate on December 31, 1991 and shall, unless terminated
otherwise as set forth in this Agreement, be automatically extended on December
31, 1991 and each anniversary of such date for an additional term of one (1)
year unless such automatic extension is declined by either party by notice given
not less than ninety (90) days before the end of the then current term of this
Agreement; provided that the term of this Agreement shall not extend beyond
Employee's normal retirement date at age 65.
3. Compensation and Benefits.
In consideration of his services during the term of this Agreement,
Employee shall be paid compensation and benefits by the Bank as follows:
(a) Base Salary.
Employee will receive an annual base salary of $81,000, payable in
monthly installments. Commencing January 1, 1989, and annually thereafter,
Employee will be entitled to receive such increases in his annual base
salary as may be approved by the Board of Directors of the Bank, with each
such increase thereafter being included in his annual base salary for all
purposes.
(b) Additional Benefits.
Employee shall be entitled to receive and participate in all benefits
and conditions of employment generally made available to the Bank's
executive officers and also those generally made available to all salaried
employees of the Bank including, but not limited to, insurance benefits,
vacation, sick leave, and reimbursement of expenses incurred on behalf of
the Bank in the course of performing duties under this Agreement.
4. Termination.
Employee's employment under this Agreement shall terminate:
(a) Upon the death of Employee;
(b) Upon written notice from the Bank to Employee in the event of an
illness or other disability incapacitating him from performing his duties
for six (6) consecutive months as determined in good faith by the Board of
Directors of the Bank or a committee of the Board;
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(c) For cause upon written notice from the Bank ("Cause" for this
purpose means (i) the willful and continued failure by Employee for a
significant period of time substantially to perform his duties with the
Bank (other than any such failure resulting from his disability) after a
demand for substantial performance is delivered to Employee by the Bank's
Board of Directors or a committee of the Board which specifically
identifies the manner in which the Board of Directors believes that
Employee has not substantially performed his duties, (ii) the willful
engaging by Employee in gross misconduct materially and demonstratively
injurious to the Bank or (iii) the conviction of Employee of any crime
involving fraud or dishonesty); or
(d) Upon thirty (30) days notice from Employee to Bank at any time
within two (2) years following a change in control of the Bank. "Change in
Control" means one or more of the following occurrences:
(i) A corporation, person or group acting in concert as described in
Section 14(d)(2) of the Securities Exchange Act of 1934, as amended
("Exchange Act"), holds or acquires beneficial ownership within the
meaning of Rule 13d-3 promulgated under the Exchange Act of a number of
shares of voting capital stock of the Bank which constitutes either (A)
more than 50 percent of the shares which voted in the election of
directors of the Bank at the shareholders' meeting immediately preceding
such determination, or (B) more than 33 percent of the Bank's then
outstanding shares entitled to vote.
(ii) A merger or consolidation to which the Bank is a party (other
than a pro forma transaction for a purpose such as changing the state of
incorporation or name of the Bank), if either (A) the Bank is not the
surviving corporation, or
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(B) the directors of the Bank immediately before the merger or
consolidation constitute less than a majority of the Board of
Directors of the surviving corporation; provided, however, the
occurrence described in clause (A) shall not constitute a change in
control if the holders of the Bank's voting capital stock
immediately before the merger or consolidation have the same
proportional ownership of voting capital stock of the surviving
corporation immediately after the merger or consolidation.
(iii) All or substantially all of the assets of the Bank are sold,
leased or disposed of in one transaction or a series of related
transactions.
(iv) An agreement, plan, contract or other arrangement is entered into
providing for any occurrence which as defined in this Agreement would
constitute a change of control.
The Bank hereby represents, warrants and agrees that it shall give prompt
notice to Employee immediately upon learning of the consummation of any of the
events set forth in paragraph 4(d) of this Agreement. If the Bank fails to give
such notice to Employee, the Bank shall be estopped from contesting, and shall
not contest, the adequacy or timeliness of any notice Employee may be allowed or
required to give following a change in control of the Bank.
5. Non-Assignability.
This Agreement shall not be assignable by Employee. This Agreement shall
not be assignable by the Bank without the prior written consent of Employee
except to a corporation which is the surviving entity in any merger involving
the Bank or to a corporation which acquires all or substantially all of the
stock or assets of the Bank.
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6. Modification.
This Agreement sets forth all the terms and conditions of the employment
agreement between Employee and the Bank and can be modified only by a writing
signed by both parties. No waiver by either party to this Agreement at any time
of any breach of the other party of, or compliance with, any condition or
provision of this Agreement to be performed by such other party shall be deemed
a waiver of similar or dissimilar provisions or conditions at the same or at any
prior or subsequent time.
7. Counterparts: Construction.
This Agreement may be executed in several identical counterparts, each of
which when so executed shall be deemed an original, but all such counterparts
shall constitute one and the same instrument. This Agreement shall be governed
by, and construed and enforced in accordance with, the laws of the State of
North Carolina.
8. Severability.
Should any provision of this Agreement be declared to be invalid for any
reason or to have ceased to be binding on the parties, such provision shall be
severed, and all other provisions shall be effective and binding.
9. Notice.
All necessary notices, demands and requests required or permitted under
this Agreement shall be in writing and shall be deemed to have been duly given
if delivered in person or mailed by certified mail, postage prepaid, addressed
as follows:
a. If to Employee: Ayden R. Lee, Jr.
4221 Peele Road
Clayton, North Carolina 27520
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b. If to Bank: Bank of Four Oaks
503 N. Wellons Street
Four Oaks, North Carolina 27524
or to such other address as shall be furnished by either party.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
day and year first above written.
BANK OF FOUR OAKS
ATTEST:
By: /s/ M.S. CANADAY
______________________________
/s/ CLIFTON PAINTER Authorized Officer
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Asst. Secretary
/s/ AYDEN R LEE, JR.
_______________________(SEAL)
(SEAL) Ayden R. Lee, Jr.
Employee
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