Exhibit No. 10.21
INDEPENDENT CONTRACTOR
CONSULTING AGREEMENT
WHEREAS,
Ernest J. Sewell
("Sewell"), FNB
Financial Services Corporation
("FNB"), and FNB Southeast ("Bank") are parties to the
Employment
Agreement
between Sewell and, as the joint employer, FNB and the Bank (jointly, the
"Company"), dated May 18, 1995 and amended on May 18, 2002, amended as of
January 1, 2004, amended on May 19, 2004, and amended as of October 20,
2005;
and
WHEREAS,
Sewell desires to retire from
employment
by the Company as
of
January 31, 2006; and
WHEREAS,
the Company
desires to continue to
have the benefit of Sewell's
experience and expertise in the maintenance and development of banking
relationships after his retirement; and
WHEREAS,
Sewell desires to advise the Company in the maintenance and
development of banking relationships;
and
WHEREAS,
Sewell and the Company desire to set forth the terms and
conditions of Sewell's engagement as an
independent contractor consultant to the
Company.
NOW,
THEREFORE, the parties agree as follows:
Section 1.
Services. Sewell shall be engaged by the
Company for the Term
(as defined in Section 2 below) as an
independent contractor to consult with and
advise the Bank concerning the maintenance of the Bank's current, and the
development of additional, banking relationships within the State of North
Carolina, including in particular, but not
by way of limitation, in New Hanover
County, North Carolina and adjacent
geographical
areas. Sewell shall
dedicate
such of his time as is reasonable and necessary to provide such consulting
services. He shall be the Senior
Advisor of the Company
and shall consult with
the Executive Committee of the Board of
Directors concerning his activities.
Section 2.
Term. The term of
Sewell's engagement under this Agreement
shall commence on February 1, 2006 and expire on January
31, 2011, unless
earlier terminated as provided herein (the "Term"). Sewell and the Company
acknowledge that they have separately agreed that Sewell shall remain an
employee of the Company through January 31,
2006 with all the rights and subject
to all of the conditions set forth in his
Employment Agreement, as amended.
Section 3.
Compensation. Beginning February 1, 2006 and continuing through
the remainder of the Term, Sewell shall receive from the Bank a monthly
consulting fee of $5,000, payable $2,500 on
each of the 15th day and 30th day of
each calendar month.
<PAGE>
Section 4.
Expense Reimbursement.
Sewell shall be
entitled to payment of
all reasonable out-of-pocket expenses incurred by him in
providing
consulting
services under this Agreement upon
presentation by him of
itemized accounts
of
such expenses and appropriate documentation
therefore.
Section 5.
Stock Option Grant. Sewell and the Company acknowledge that the
Board of Directors of FNB and the
"Committee" administering FNB's Omnibus Equity
Compensation Plan ("Option Plan") have determined to award Sewell a
non-qualified option to acquire 50,000 shares of FNB's common
stock on October
31, 2005, such option having an exercise price equal to the closing
price of
FNB's common stock on The Nasdaq Stock Market, Inc. on the last trading day
prior to October 31, 2005 (the "Option").
The Committee has
determined that the
Option shall vest and become exercisable on
January 31, 2011, except as follows:
a.
The Option
shall terminate and be of no further force or effect upon
the termination of Sewell's engagement under this Agreement prior
to
the expiration of the Term (i) by Sewell voluntarily, (ii) by
reason
of Sewell's Disability
(as defined in Section 6 below), or (iii) by
the Company for Cause (as defined in Section 6 below);
b.
The Option
shall be immediately
vested and be exercisable by Sewell
upon the occurrence of
an "Acceleration
Event," as defined in
the
Option Plan, and as provided in the Option Plan; and
c.
Upon the
death of Sewell during
the Term, one-fifth
of the Option
(i.e. 10,000 shares) shall be deemed vested and exercisable for
each
twelve (12) month
period from February
1st through
January 31st
occurring during the Term and prior to Sewell's death.
The Committee has additionally determined that the period of time
following
Sewell's "Retirement" (as defined in the Option
Plan) within which the
Option
may be exercised by Sewell shall be the
period ending on the
first anniversary
of the date the Option first becomes vested
and exercisable. The award agreement
with respect to the Option shall set forth
the above provisions.
Section 6.
Termination.
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a.
In the
event of the death or Disability (as defined below) of Sewell
during the Term,
Sewell's engagement
under this
Agreement shall
terminate immediately.
"Disability"
shall mean the
inability, by
reason of bodily
injury or physical or mental disease, or any
combination thereof,
of Sewell to provide
the consulting
services
specified under
this Agreement for a period of more than 90
consecutive days. In the event the parties are unable to agree as
to
whether Sewell is
suff
