CHANGE IN CONTROL AGREEMENT

EXHIBIT 10.20

CHANGE IN CONTROL AGREEMENT

THIS AGREEMENT (the "Agreement") is made as of January 3, 2006 (the "Effective Date") by and between Darrell R. Rains (the "Employee") and Georgia Bank & Trust Company, a Georgia corporation (the "Bank").

WHEREAS, the Employee is currently employed by the Bank, a wholly-owned subsidiary of Southeastern Bank Financial Corporation (the "Company"); and

WHEREAS, the Bank desires to induce the Employee to continue in the employ of the Bank by offering this agreement providing severance benefits to the Employee upon a Change in Control (as defined below) of the Company or the Bank.

NOW, THEREFORE, in consideration of the mutual covenants herein contained, the parties agree as follows:

1. Definitions . For purposes of this Agreement, the following terms and conditions shall have the meanings set forth in this Section 1:

• (a) " Area " means the geographic area within the boundaries of Richmond and Columbia Counties, Georgia. It is the express intent of the parties that the Area as defined herein is the area where the Employee performs services on behalf of the Bank as of the Effective Date.

  (b) " Board of Directors " means the Board of Directors of the Company or the Bank, as the context implies.

  (c) " Business of the Company " means the business conducted by the Company and the Bank which is the business of banking, including the solicitation of time and demand deposits and the making of residential, consumer, commercial and corporate loans.

  (d) " Cause " means the occurrence of any of the following events: (i) conduct by the Employee that is demonstrably likely to lead to material financial harm to the Company or the Bank; (ii) conduct by the Employee of a fraudulent nature against the Company or the Bank that resulted or was intended to result in direct or indirect gain to or personal enrichment of the Employee; (iii) conduct resulting in the conviction of the Employee of a felony; and (iv) conduct by the Employee that results in the permanent removal of the Employee from his position as an officer or an employee of the Company or the Bank pursuant to written order by any regulatory agency with authority and jurisdiction over the Company or the Bank, as the case may be.

  (e) " Change in Control " means the occurrence of any of the following events on or after the Effective Date:

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• • • (i) within any twelve-month period (beginning on or after the Effective Date) the persons who constitute the Board of Directors of the Company or the Bank immediately before such twelve-month period (the "Incumbent Directors") cease for any reason to constitute at least a majority of such Board of Directors; provided, however, that any person becoming a director subsequent to the Effective Date shall be deemed to be an Incumbent Director if that director was elected to such Board of Directors by, or on the recommendation of or with the approval of, at least two-thirds ( ² / ₃ ) of the directors who then qualified as Incumbent Directors; and provided further that no director whose initial assumption of office is in connection with an actual or threatened election contest relating to the election of directors shall be deemed an Incumbent Director;

      (ii) the consummation of a reorganization, merger or consolidation of the Company or the Bank, with respect to which persons who were the stockholders of the Company or the Bank, as the case may be, immediately prior to such reorganization, merger or consolidation do not, immediately thereafter, own more than fifty percent (50%) of the combined voting power entitled to vote in the election of directors of the reorganized, merged or consolidated entity’s then outstanding voting securities; or

      (iii) the sale, transfer or assignment of all or substantially all of the assets of the Company and the Bank to any third party.

  (f) " Confidential Information " means data and information relating to the Business of the Company (which does not rise to the status of a Trade Secret) which is or has been disclosed to the Employee or of which the Employee became aware as a consequence of or through its relationship to the Company and the Bank and which has value to the Company and the Bank and is not generally known to its competitors. Without limiting the foregoing, Confidential Information shall include the following:

  • • (i) all items of information that could be classified as a trade secret pursuant to Georgia law;

      (ii) the names, addresses and banking requirements of the customers of the Company and the Bank and the nature and amount of business done with such customers;

      (iii) the names and addresses of employees and other business contacts of the Company and the Bank;

      (iv) the particular names, methods and procedures utilized by the Company and the Bank in the conduct and advertising of their business;

      (v) the applications, operating system, communication and other computer software and derivatives thereof, including, without limitation, sources and object codes, flow charts, coding sheets, routines, subrouting and related documentation and manuals of the Company and the Bank; and

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• • • (vi) marketing techniques, purchasing information, pricing policies, loan policies, quoting procedures, financial information, customer data and other materials or information relating to the Company’s and the Bank’s manner of doing business.

  Confidential Information shall not include any data or information that has been voluntarily disclosed to the public by the Company or the Bank (except where such public disclosure has been made by the Employee without authorization) or that has been independently developed and disclosed by others, or that otherwise enters the public domain through lawful means.

  (g) " Good Reason " means, with respect to a voluntary resignation by the Employee, any one of the following events, but only if such event first arose within forty-five (45) days of such resignation, the Employee provided the Employer with written notice of the event within fifteen (15) days after the event occurred and an opportunity to cure for at least ten (10) business days from its receipt of the notice and the circumstances continued, uncured, through the effective date of the Employee’s resignation:

  • • (i) a material diminution in the Employee’s position, authority or duties effected by the Employer;

      (ii) a material reduction in the Employee’s base salary rate or annual bonus opportunity effected by the Employer; or

      (iii) a requirement by the Employer that the Employee’s services be rendered primarily at a location more than fifty (50) miles from August, Georgia.

  (h) " Trade Secrets " means information, without regard to form, including, but not limited to, technical or nontechnical data, formulas, patterns, compilations, programs, devices, methods, techniques, drawings, processes, financial data, financial plans, product plans or lists of actual or potential customers or suppliers which (i) derives economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, and (ii) is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

2. Term . The term of this Agreement (the "Term") shall become effective as of the Effective Date and shall remain in effect until the earliest of (a) the Employee’s termination of employment with the Bank prior to a Change in Control; (b) the twenty-fourth-month anniversary of the effective date of a Change in Control if there has been no Qualifying Termination of Employment (as defined in Section 3); (c) a termination of this Agreement pursuant to Section 18; or (d) until all amounts that may be payable to the Employee pursuant to Section 3 below have been paid.

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3. Severance Benefits Upon Termination of Employment . If, while this Agreement is in effect, the Employee (a) is involu