Exhibit 10.1
CONSULTING AGREEMENT
BETWEEN
FOUR OAKS BANK & TRUST COMPANY
AND
JOHN W. BULLARD
THIS
CONSULTING
AGREEMENT ("Agreement") is made and entered into by
and
between JOHN W.
BULLARD ("Consultant") and FOUR OAKS BANK & TRUST COMPANY
("Bank").
The
Bank, Four Oaks Fincorp., Inc. and Longleaf Community Bank
are parties
to a Merger Agreement dated April 17, 2008 (the "Merger Agreement").
Consultant's entry into this Agreement is a condition of the Merger
Agreement.
Additionally,
Consultant has experience beneficial to the Bank's business.
The Bank desires to
retain Consultant's
consulting
services on the terms
and
conditions set forth herein, and Consultant desires to provide such
consulting
services as an
independent contractor
and is willing to do so on the terms and
conditions set forth herein.
In
consideration
of the above and the
mutual promises
set forth below,
Consultant and the Bank agree as follows:
1.
Consulting Services. During the term of this Agreement, Consultant
shall
provide to the Bank such consulting services as may be reasonably
requested by
the Bank upon reasonable notice to Consultant.
2.
Termination of Prior Agreement. The Bank and Consultant
acknowledge and
agree that:
(i) the Employment Agreement between Consultant and Longleaf
Community Bank dated August 4, 2003 has been involuntarily terminated without
Cause; (ii) the Bank
is not obligated to pay Consultant any "Base Salary" under
that Employment
Agreement;
and, (iii) the "Restriction Period" under that
Employment Agreement has expired.
3.
Term. The term of this Agreement shall be for a period of three (3)
years, beginning on the Closing, as defined in the Merger
Agreement, and
ending
on the third
anniversary of that
date unless
terminated
earlier as
provided
herein.
4.
Consulting Retainer,
Fee and Expenses. The
Bank shall pay Consultant a
retainer in the amount of Fifty Thousand and No/100 Dollars ($50,000.00) per
year for services rendered and obligations under this Agreement. Said retainer
shall be paid in substantially equal monthly installments on the first
business
day of each month
of the term of this Agreement. The Bank shall also pay
expenses
reasonably
incurred by
Consultant
in rendering such services.
Consultant shall submit monthly invoices for his expenses
incurred in
rendering
consulting services to
the Bank, and the Bank
shall pay such
invoices within
thirty (30) days of receipt of the same.
5.
Independent Contractor
Status. The parties hereby acknowledge and agree
that Consultant's consulting services for the Bank shall be
provided strictly as
an independent
contractor.
Nothing in this
Agreement shall be construed to
render him an employee, co-venturer, agent, or other representative
of the Bank.
Consultant understands
that he must comply
with all tax laws
applicable to a
self-employed individual, including the filing of any
necessary tax returns and
the payment
of all income and self-employment taxes. The Bank shall not be
required to withhold from the consulting fee any state or federal income
taxes
or to make payments for Social Security ("FICA") tax, unemployment
insurance, or
any other payroll taxes. The Bank shall not be responsible for, and shall not
obtain, worker's
compensation,
disability benefits insurance, or unemployment
security insurance coverage for Consultant. Consultant is not eligible for,
nor
entitled to, and shall not participate in, any of the Bank's
pension, health, or
other benefit plans,
if any such plans
exist. Consistent
with his duties
and
obligations under this Agreement, Consultant shall, at all times,
maintain sole
and exclusive
control over the manner and method by which he performs his
consulting services.
<PAGE>
6.
Trade Secrets,
Confidential Information, Bank Property and Competitive
Business Activities. Consultant acknowledges that by virtue of his
position as a
consultant with the
Bank, he (i) has or
will have access to trade secrets and
Confidential
Information (as
defined in Section
6.1.5) of the Bank
including
valuable information
about its business
operations
and entities with whom
it
does business in
various locations,
and (ii) has
developed or will develop
relationships with
parties with whom it does business in various locations.
Consultant also
acknowledges that the Trade Secrets, Confidential Information
and Competitive
Business Activities
provisions set forth in this Agreement are
reasonably necessary
to protect the Bank's legitimate business interests, are
reasonable as to
the time, territory and scope of activities which are
restricted, do not
interfere with public policy or public interest and are
described with sufficient accuracy and definiteness to
enable him to understand
the scope of the restrictions imposed on him.
6.1. Trade
Secrets
and Confidential Information. Consultant
acknowledges that:
(i) the Bank will
disclose to him certain trade secrets and
Confidential
Information; (ii)
trade secrets and Confidential Information are
the sole and exclusive property of the Bank and the Bank owns all
rights therein
under patent,
copyright,
trade secret, confidential information, or other
property right;
and (iii) the
disclosure
of trade secrets and Confidential
Information to
Consultant
does not confer upon
him any license,
interest or
rights of any kind in or to the trade secrets or Confidential
Information.
6.1.1. Consultant
may use the trade secrets and Confidential
Information only in
accordance with applicable Bank policies and procedures and
solely for the
Bank's benefit while he is retained by the Bank. Except as
authorized in the performance of services for the Bank,
Consultant will hold
in
confidence and not directly or indirectly, in any form, by any
means, or for any
purpose, disclose, reproduce, distribute, transmit, reverse
engineer, decompile,
disassemble, or
transfer trade secrets or Confidential Information or any
portion thereof.
Upon the Bank's
request, Consultant
shall return to the Bank
all trade secrets and Confidential Information and all related
materials in his
possessi
