SETTLEMENT AND GENERAL RELEASE AGREEMENT

THIS SEVERANCE AGREEMENT AND GENERAL RELEASE ("the Agreement") is made and
entered into by and between Patricia Bearden (hereinafter Employee") and First
Farmers & Merchants Bank (hereinafter "the Company') with respect to the end of
Employee's employment with the Company.

Section 1 — Benefits

(a)     In General: The Company promises that Employee will receive the benefits
set forth in this Section after Employee executes and returns this Agreement to
the Company and does not revoke the Agreement as set forth in Section 4 herein.
Employee acknowledges that the Company is not otherwise required to provide such
benefits until such conditions have been met.

(b)     Sufficiency of Consideration: Employee acknowledges and agree that, the
benefits to be provided under the terms of the Agreement are. in significant and
substantial part, in addition to those benefits to which Employee is otherwise
entitled.

(c)     Cash Payment: The Company and Employee agree that upon the expiration of
the revocation period set forth in Section 4 herein, then the Company will cause
Employee to receive severance pay equal to six (G) months of her current gross
salary ($89,000.00), minus any applicable taxes and withholdings. Payment of the
monetary amounts described herein will be made after the expiration of the
revocation period set forth below and will be made in twelve semi-monthly
installments of $7,416.67, less applicable taxes and withholdings, pursuant to
the Company's normal payroll practices. Employee agrees that these payments are
more than the Company is required to make under its normal policies and
procedures and that the sums to be provided under the terms of this Agreement
are sufficient consideration for Employee's promises set out herein.

(d)     Accrued Vacation Time: The Company further agrees to pay Employee for
the accrued vacation and paid time off benefits that Employee has earned but not
used as of the Separation Date. Such benefits shall be paid at Employee's
current pay rate, less applicable taxes and withholdings.

(e)     Benefits: After the Separation Date Employee shall not participate in
the Company's deferred profit-sharing plan, or any other benefit or stock plan
sponsored by the Company, except as the terms of the deferred profit-sharing
plan allow for qualified retirees. Employee shall, however, be entitled to any
funds accrued in the plans prior to the Separation Date (less any outstanding
principal loan balance. where applicable), to the extent and in accordance with
the terms of the plans. Additionally, Employee will retain individual health and
dental coverage through the company's health and dental plan for a period of six
(6) months from the date of termination of employment at the employee rate.

 

 

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Section 2 — Complete Release

(a)    In General: In exchange for the Company's promises contained in this
Agreement, Employee, on behalf of herself and all her heirs, successors, and
assigns, agrees to irrevocably and unconditionally release any and all Claims
she may now have against the Company and other parties as set forth in this
Section 2.

(b)    Released Parties: The Released Parties are the Company, all related
companies, partnerships, subsidiaries, including but not limited to First
Farmers and Merchant Bank, their parents, or joint ventures, and, with respect
to each of them, their predecessors and successors; and, with respect to each
such entity, all of its past and present employees, officers, directors,
stockholders, owners, representatives, assigns, attorneys, agents, insurers,
employee benefit programs (and the trustees, administrators, fiduciaries, and
insurers of such programs), and any other persons acting by, through, under or
in concert with any of the persons or entities listed in this subsection.

(c)     Claims Released: Employee understands and agrees that she is releasing
all known and unknown claims, promises, causes of action, or similar rights of
any type (the "Claims") that she may have against any Released Party, except
that she is not releasing any claim that relates to: (i) her right to enforce
this Agreement; (ii) her right, if any, to claim government-provided
unemployment benefits; (iii) her right to claim any workers' compensation
benefits; or (iv) any rights or claims which may arise or accrue after she signs
this Agreement. Employee further understands that the Claims she is releasing
may arise under many different laws (including statutes, regulations, other
administrative guidance, and common law doctrines), including, but by no means
limited to the Family and Medical Leave Act of 1993; the Age Discrimination in
Employment Act; the Older Workers Benefit Protection Act; Title VII of the Civil
Rights Act of 1964; and any other federal, state, or local laws relating to
employment; and any other federal, state, or local tort or contract claim.

(d)     Unknown Claims: Employee understands that she is releasing Claims that
she may not know about. That is Employee's knowing and voluntary intent, even
though she recognizes that someday she might learn that some or all of i he
facts she currently believes to be true are untrue and even though she might
then regret having signed this Agreement. Nevertheless, Employee is assuming
that risk and she agrees that this Agreement shall remain effective in all
respects in any such case. Employee expressly waives all rights she might have
under any law that is intended to protect her from waiving unknown claims.
Employee understands the significance of doing so.

 

 

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(c)      Knowing and Voluntary: The Company and Employee both represent and
agree that they have thoroughly considered all aspects of this Agreement, that
they have had the opportunity to discuss this matter with an attorney of their
choice, that they have read carefully and understand fully all of the provisions
of this Agreement and that they are entering into this Agreement voluntarily.
Employee further understands that the Company is relying on this and all other
representations that Employee has made herein.

Section 3 — Promises

(a)     Pursuit of Released Claims: Employee has not filed or caused to be filed
any lawsuit, complaint, or charge with respect to any Claim this Agreement
purports to waive, and Employee promises never to file or prosecute a lawsuit or
complaint based on such Claims. Employee promises never to seek any damages,
remedies, or other relief for herself personally (any right to which she hereby
waives) by filing or prosecuting a charge with any administrative agency with
respect to any such Claim. Employee promises to request any government agency or
other body assuming jurisdiction of any such lawsuit, complaint, or charge to
withdraw from the matter or dismiss the matter with prejudice. Employee further
agrees that she will not rely on any events, acts, statements, or omissions that
occurred prior to execution of this Agreement to support any present or future
claims against the Company.

(

b)     Ownership of Claims: Employee has not assigned or transferred any Claim
she is releasing, nor has she purported to do so.

(c)     Non-admission of Liability: Employee agrees that this Agreement is not
an admission of guilt or wrongdoing by any Released Party and Employee
acknowledges that the Released Parties deny that they have engaged in wrongdoing
of any kind or nature.

Section 4 - Review and Revocation

Employee acknowledges and understands that she has twenty-one (21) days to
review and consider this Agreement before signing it. No discussions about, or
changes to, this Agreement will restart the running of said twenty-one day
period. Employee understands that she may use as much of this twenty-one (21)
day period as she wishes prior to signing and that Employee may revoke this
Agreement within seven (7) days of signing it. Revocation can be made by
delivering a written notice of revocation to Barry White, First Farmers and
Merchants Bank, 816 S. Garden Street, P.O. Box 1148. Columbia, Tennessee 38402.
For this revocation to be effective, written notice must be received no later
than the close of" business on the seventh day after Employee signs this
Agreement. If Employee revokes this Agreement, it shall not be effective or
enforceable and Employee will not receive the benefits described herein nor
shall Employee or the Company be bound by any representations, releases or
agreements made herein.

 

 

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Section 5- Miscellaneous

(a)     Entire Agreement: This is the entire agreement between the Company and
Employee. This Agreement may not be modified or canceled in any manner except by
a writing signed by both an authorized Company official and me. Employee
acknowledges that the Company has made no representations or promises to
Employee, other than those in this Agreement.

(b)     If any provision in this Agreement is found to be unenforceable, all
other provisions will remain fully enforceable.

(c)     Successors: This Agreement binds Employee's heirs, administrators,
representatives, executors, successors, and assigns, and will inure to the
benefit of all Released Parties and their respective heirs, administrators,
representatives, executors, successors, and assigns.

(d)     Interpretation: This Agreement shall be construed as a whole according
to its fair meaning. It shall not be construed strictly for or against any
Released Party or Employee. Unless the context indicates otherwise, the singular
or plural number shall be deemed to include the other. Captions are intended
solely for convenience of reference and shall not be used in the interpretation
of this Agreement. This Agreement shall be governed by the laws of the State of
Tennessee.

 

TAKE THIS AGREEMENT HOME, READ IT, AND CAREFULLY CONSIDER ALL OF ITS PROVISIONS
BEFORE SIGNING IT: IT INCLUDES A RELEASE OF KNOWN AND UNKNOWN CLAIMS IF YOU
WISH, YOU SHOULD CONSULT YOUR ATTORNEY

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