Beach First National Bank

Salary Continuation Agreement

Exhibit 10.1

BEACH FIRST NATIONAL BANK

SALARY CONTINUATION AGREEMENT

        This Salary Continuation Agreement (the “Agreement”) is adopted this 1st
day of March, 2008, by and between Beach First National Bank, a
nationally-chartered commercial bank located in Myrtle Beach, South Carolina
(the “Bank”) and Gary Austin (the “Executive”). The purpose of this Agreement is
to provide specified benefits to the Executive, a member of a select group of
management or highly compensated employees who contribute materially to the
continued growth, development, and future business success of the Bank. This
Agreement shall be unfunded for tax purposes and for purposes of Title I of the
Employee Retirement Income Security Act of 1974 (“ERISA”), as amended from time
to time.

ARTICLE 1
DEFINITIONS

        Whenever used in this Agreement, the following words and phrases shall
have the meanings specified:

1.1 “Account Value” means the amount shown on Schedule A, column 3. The parties
expressly acknowledge that the Account Value may be different than the liability
that should be accrued by the Bank, under Generally Accepted Accounting
Principles (“GAAP”), for the Bank’s obligation to the Executive under this
Agreement. The Account Value on any date other than the end of a Plan Year shall
be determined by adding the prorated increase attributable for the current Plan
Year to the Account Value for the previous Plan Year. The Account Value shall be
recalculated each Plan Year based on the Executive’s actual Final Pay for that
Plan Year. To calculate the Account Value for a Plan Year, the Plan
Administrator will use the interest method of accounting based on thirty-five
(35%) of Final Pay for the Plan Year, calculated using an annual rate of six
percent (6%), compounded monthly.

1.2 “Board” means the Board of Directors of the Bank as from time to time
constituted.

1.3 “Change in Control” means a change in the ownership or effective control of
the Bank, or in the ownership of a substantial portion of the assets of the
Bank, as such change is defined in Code Section 409A and regulations thereunder.

1.4 “Change in Control Vesting Percentage” the Executive shall be vested in
fifty percent (50%) of the Change in Control benefit from the one year
anniversary of the Executive’s date of hire with the Bank until the six year
anniversary, eighty percent vested (80%) in the benefit from the six year
anniversary until the eight year anniversary and one hundred percent (100%)
vested in the benefit from the nine year anniversary of the Executive’s date of
hire thereafter.

1.5 “Code” means the Internal Revenue Code of 1986, as amended.

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Salary Continuation Agreement

 

1.6 “Disability” means the Executive (i) is unable to engage in any substantial
gainful activity by reason of any medically determinable physical or mental
impairment which can be expected to result in death or can be expected to last
for a continuous period of not less than twelve (12) months, or (ii) is, by
reason of any medically determinable physical or mental impairment which can be
expected to result in death or can be expected to last for a continuous period
of not less than twelve (12) months, receiving income replacement benefits for a
period of not less than three (3) months under an accident and health plan
covering employees of the Bank. Medical determination of Disability may be made
by either the Social Security Administration or by the provider of an accident
or health plan covering employees of the Bank. Upon the request of the Plan
Administrator, the Executive must submit proof to the Plan Administrator of the
Social Security Administration’s or provider’s determination.

1.7 “Early Termination” means Separation from Service before Normal Retirement
Age for reasons other than death, Disability, Termination for Cause, or Change
in Control.

1.7 “EffectiveDate” means July 1, 2007.

1.9 “Final Pay” means the Executive’s highest annualized base salary (before
reduction for compensation deferred pursuant to all qualified, non-qualified,
and Code Section 125 plans) from the three (3) years prior to Separation from
Service, including the year Separation from Service occurs.

1.10 "Normal Retirement Age" means the Executive attaining age sixty-five (65).

1.11 ’Normal Retirement Date” means the later of the Executive attaining age
sixty-five (65) or Separation from Service.

1.12 “Plan Administrator” means the plan administrator described in Article 5.

1.13 “Plan Year” means each twelve (12) month period commencing on June 1 and
ending on May 31 of each year. The initial Plan Year shall commence on the
Effective Date of this Agreement and end on the following May 31.

1.14 "Projected Benefit" means thirty-five percent (35%) of Projected Final Pay.

1.15 “Projected Final Pay” means Final Pay increased seven percent (7%)
annually, until Normal Retirement Age.

1.16 “Schedule A” means the schedule attached to this Agreement and made a part
hereof. Schedule A shall be updated upon a change in any of the benefits under
Article 2.

1.17 “Separation from Service” means termination of the Executive's employment
with the Bank for reasons other than death. Whether a Separation from Service
has occurred is

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determined based on whether the facts and circumstances indicate that the Bank
and Executive reasonably anticipated that no further services would be performed
after a certain date or that the level of bona fide services the Executive would
perform after such date (whether as an employee or as an independent contractor)
would permanently decrease to no more than twenty percent (20%) of the average
level of bona fide services performed (whether as an employee or an independent
contractor) over the immediately preceding thirty-six (36) month period (or the
full period of services to the Bank if the Executive has been providing services
to the Bank less than thirty-six (36) months).

1.18 “Specified Employee” means an employee who at the time of Separation from
Service is a key employee of the Bank or the Company, if any stock of the Bank
or the Company is publicly traded on an established securities market or
otherwise. For purposes of this Agreement, an employee is a key employee if the
employee meets the requirements of Code Section 416(i)(1)(A)(i), (ii), or (iii)
(applied in accordance with the regulations thereunder and disregarding section
416(i)(5)) at any time during the twelve (12) month period ending on a
Separation from Service.

1.19 "Termination for Cause" has that meaning set forth in Article 4.

1.20 “Vesting Percentage” means ten percent (10%) for each Plan Year until a
maximum of one hundred percent (100%) after ten (10) Plan Years.

ARTICLE 2
DISTRIBUTIONS DURING LIFETIME

2.1 Normal Retirement Benefit. Upon the Normal Retirement Date, the Bank shall
distribute to the Executive the benefit described in this Section 2.1 in lieu of
any other benefit under this Article.

  2.1.1 Amount of Benefit. The annual benefit under this Section 2.1 is
thirty-five percent (35%) of Final Pay.

  2.1.2 Distribution of Benefit. The Bank shall distribute the annual benefit to
the Executive in twelve (12) equal monthly installments commencing on the first
day of the month following the Normal Retirement Date. The annual benefit shall
be distributed to the Executive for the greater of (i) seventeen (17) years or
(ii) the Executive’s lifetime.

2.2 Early Termination Benefit. Upon the Executive's Early Termination, the Bank
shall distribute to the Executive the benefit described in this Section 2.2 in
lieu of any other benefit under this Article.

  2.2.1 Amount of Benefit. The benefit under this Section 2.2 is determined by
multiplying the Vesting Percentage by the Account Value for the Plan Year

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  ending immediately prior to Early Termination and then increasing the vested
balance at an annual rate of six percent (6.0%), compounded monthly, until
commencement of benefit payments under this Section 2.2. The annual benefit is
determined by calculating a two hundred four (204) month fixed annuity from the
vested inflated Account Value, crediting interest on the unpaid balance at an
annual rate of six percent (6.0%), compounded monthly.

  2.2.2 Distribution of Benefit. The Bank shall distribute the annual benefit to
the Executive in twelve (12) equal monthly installments commencing on the first
day of the month following Normal Retirement Age. The annual benefit shall be
distributed to the Executive for the greater of (i) seventeen (17) years or (ii)
the Executive’s lifetime.

2.3 Disability Benefit. If the Executive experiences a Disability prior to
Normal Retirement Age, the Bank shall distribute the benefit described in this
Section 2.3 in lieu of any other benefit under this Agreement.

  2.3.1 Amount of Benefit. The benefit under this Section 2.3 is determined by
multiplying one hundred percent (100%) of the Account Value for the Plan Year
ending immediately prior to Disability and then increasing the balance at an
annual rate of six percent (6.0%), compounded monthly, until commencement of
benefit payments under this Section 2.3. The annual benefit is determined by
calculating a two hundred four (204) month fixed annuity from the vested
inflated Account Value, crediting interest on the unpaid balance at an annual
rate of six percent (6.0%), compounded monthly.

  2.3.2 Distribution of Benefit. The Bank shall distribute the annual benefit to
the Executive in twelve (12) equal monthly installments commencing on the first
day of the month following Normal Retirement Age. The annual benefit shall be
distributed to the Executive for the greater of (i) seventeen (17) years or (ii)
the Executive’s lifetime.

2.4 Change in Control Benefit. Upon a Change in Control, the Bank shall
distribute to the Executive the benefit described in this Section 2.4 in lieu of
any other benefit under this Agreement.

  2.4.1 Amount of Benefit. The benefit under this Section 2.4 is the present
value of the Projected Benefit using a six percent (6%) interest rate and a
seventeen (17) year payment stream, subject to the Change in Control Vesting
Percentage.

  2.4.2 Distribution of Benefit. The Bank shall distribute the benefit to the
Executive in a lump sum within ninety (90) days following a Change in Control.

  2.4.3 Internal Revenue Service Section 280G Gross Up. If, as a result of a
Change in Control, the Executive becomes entitled to benefits under this
Agreement or

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  under any other benefit, compensation or incentive plan or arrangement with
the Bank (collectively, the “Total Benefits”), and if any part of the Total
Benefits is subject to the Excise Tax under Section 280G and Section 4999 of the
Internal Revenue Code (the “Excise Tax”), the Bank shall pay to the Executive
the following additional amounts, consisting of (a) a payment equal to the
Excise Tax payable by the Executive on the Total Benefits under Section 4999 of
the Internal Revenue Code (the “Excise Tax Payment”), and (b) a payment equal to
the amount necessary to provide the Excise Tax payment net of all income,
payroll and excise taxes. Any payment pursuant to this Section 2.4.3 shall be
made at the latest by the end of the Executive’s taxable year next following the
calendar year in which the Change in Control event occurred. Payment of the
additional amounts described in clauses (a) and (b) shall be made in addition to
the amount set forth in Section 2.4.1 above.

  2.4.4 Reimbursement of Legal Fees. If the Executive seeks any legal action to
compel the bank to pay the Change in Control benefit, the Bank shall reimburse
the Executive any legal fees incurred. The Executive shall be reimbursed on the
30th day following the date that the Executive substantiates any expense
incurred pursuant to this Section 2.4.4 with respect to which reimbursement is
applicable.

2.5 Restriction on Commencement of Distributions.  Notwithstanding any provision
of this Agreement to the contrary, if the Executive is considered a Specified
Employee at Separation from Service or at any time during the 12-month period
ending on a Separation from Service, the provisions of this Section 2.5 shall
govern all distributions hereunder. If benefit distributions which would
otherwise be made to the Executive due to Separation from Service are limited
because the Executive is a Specified Employee, then such distributions shall not
be made during the first six (6) months following Separation from Service.
Rather, any distribution which would otherwise be paid to the Executive during
such period shall be accumulated and paid to the Executive in a lump sum on the
first day of the seventh month following Separation from Service. All subsequent
distributions shall be paid in the manner specified.

2.6 Distributions Upon Taxation of Amounts Deferred. If, pursuant to Code
Section 409A, the Federal Insurance Contributions Act or other state, local or
foreign tax, the Executive becomes subject to tax on the amounts deferred
hereunder, then, to the extent such tax liability can be paid by the amount that
may be currently distributed to the Executive under Sections 2.1-2.4 of this
Agreement without the imposition of additional tax liability under Section 409A
of the Code, the Bank may make a limited distribution to the Executive as soon
as is administratively practicable following the discovery of the tax liability
of an amount not to exceed the amount that becomes subject to tax, in accordance
with the provisions of Treasury Regulations Section 1.409A-3(j)(vi), (vii) and
(xi). Any such distribution will decrease the Executive’s benefit hereunder.

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Salary Continuation Agreement

2.7 Change in Form or Timing of Distributions.  For distribution of benefits
under this Article 2, the Executive and the Bank may, subject to the terms of
Section 8.1, amend this Agreement to delay the timing or change the form of
distributions.  Any such amendment:

  (a)

may not accelerate the time or schedule of any distribution, except as provided
in Code Section 409A and the regulations thereunder;

  (b)

must, for benefits distributable under Sections 2.2 and 2.3, be made at least
twelve (12) months prior to the first scheduled distribution;

  (c)

must, for benefits distributable under Sections 2.1, 2.2 and 2.4, delay the
commencement of distributions for a minimum of five (5) years from the date the
first distribution was originally scheduled to be made; and

  (d)

must take effect not less than twelve (12) months after the election is made.

ARTICLE 3
DISTRIBUTION AT DEATH

3.1 Death During Active Service. If the Executive dies prior to Separation from
Service, the Executive’s Beneficiary shall be entitled to an amount equal to the
Account Value less any amount the Beneficiary is entitled to receive under any
split dollar arrangement between the Bank and the Executive, in a single lump
sum on the first day of the fourth month following the Executive’s death. The
Beneficiary shall be required to provide to the Bank the Executive’s death
certificate.

3.2 Death During Distribution of a Benefit. If the Executive dies after any
benefit distributions have commenced under this Agreement but before receiving
the minimum seventeen (17) years of such distributions, the Bank shall
distribute to the Beneficiary the present value of the remaining portion of the
minimum seventeen (17) years of benefits due under this Agreement, in a single
lump sum on the first day of the fourth month following the Executive’s death.
The Beneficiary shall be required to provide to the Bank the Executive’s death
certificate.

3.3 Death Before Benefit Distributions Commence. If the Executive is entitled to
benefit distributions under this Agreement but dies prior to the date that
commencement of said benefit distributions are scheduled to be made under this
Agreement, the Bank shall distribute to the Beneficiary the present value of the
minimum seventeen (17) years of benefits due under this Agreement, in a single
lump sum on the first day of the fourth month following the Executive’s death.
The Beneficiary shall be required to provide to the Bank the Executive’s death
certificate.

ARTICLE 4
GENERAL LIMITATIONS

4.1 Termination for Cause. Notwithstanding any provision of this Agreement to
the contrary, the Bank shall not distribute any benefit under this Agreement if
the

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4.1 Executive’s service is terminated by the Board for:

  (a)

Gross negligence or gross neglect of duties to the Bank; or

  (b)

Conviction of a felony or of a gross misdemeanor involving moral turpitude in
connection with the Executive’s employment with the Bank; or

  (c)

Fraud, disloyalty, dishonesty or willful violation of any law or significant
Bank policy committed in connection with the Executive’s employment and
resulting in a material adverse effect on the Bank.

4.2 Suicide or Misstatement. No benefits shall be distributed if the Executive
commits suicide within three (3) years after the Effective Date of this
Agreement, or if an insurance company which issued a life insurance policy
covering the Executive and owned by the Bank denies coverage (i) for material
misstatements of fact made by the Executive on an application for such life
insurance, or (ii) for any other reason.

4.3 Removal. Notwithstanding any provision of this Agreement to the contrary,
the Bank shall not distribute any benefit under this Agreement if the Executive
is subject to a final removal or prohibition order issued by an appropriate
federal banking agency pursuant to Section 8(e) of the Federal Deposit Insurance
Act.

4.4 Competition after Separation from Service. The Executive shall forfeit all
benefits and the Bank shall not be required to pay any benefits under this
Agreement if the Executive, without the prior written consent of the Bank and
within two (2) years from Separation from Service, engages in, directly or
indirectly, as a sole proprietor, as a partner in a partnership, or as a
substantial shareholder in a corporation, or becomes associated with, in the
capacity of employee, director, officer, principal, agent, trustee or in any
other capacity whatsoever, any enterprise conducted in the trading area (a fifty
(50) mile radius) of the business of the Bank, which enterprise is competitive
with any Business (as defined below) carried on by the Bank as of the date of
Separation from Service. This section shall not apply following a Change in
Control. Business shall mean the operation of a depository financial
institution, including, without limitation, the solicitation and acceptance of
deposits of money and commercial paper, the solicitation and funding of loans
and the provision of other banking services, and any other related business
engaged in by the Bank or any of its affiliates as of Separation from Service.

4.5 Solicitation after Separation from Service. The Executive shall forfeit all
benefits and the Bank shall not be required to pay any benefits under this
Agreement if the Executive, without the prior written consent of the Bank and
within two (2) years from Separation from Service, (a) solicits any employee of
the Bank for the purpose of hiring such employee away from the Bank or (b)
solicits any customer of the Bank that was a customer of the Bank at or prior to
Separation from Service for the purpose of obtaining such customer’s business
relationship in any manner that could be deemed to be competitive to the Bank.
This section shall not apply following a Change in Control.

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ARTICLE 5
ADMINISTRATION OF AGREEMENT

5.1 Plan Administrator Duties. This Agreement shall be administered by a Plan
Administrator which shall consist of the Board, or such committee or person(s)
as the Board shall appoint. The Plan Administrator shall also have the
discretion and authority to (i) make, amend, interpret and enforce all
appropriate rules and regulations for the administration of this Agreement and
(ii) decide or resolve any and all questions including interpretations of this
Agreement, as may arise in connection with the Agreement.

5.2 Agents. In the administration of this Agreement, the Plan Administrator may
employ agents and delegate to them such administrative duties as it sees fit,
(including acting through a duly appointed representative), and may from time to
time consult with counsel who may be counsel to the Bank.

5.3 Binding Effect of Decisions. The decision or action of the Plan
Administrator with respect to any question arising out of or in connection with
the administration, interpretation and application of the Agreement and the
rules and regulations promulgated hereunder shall be final and conclusive and
binding upon all persons having any interest in the Agreement.

5.4 Indemnity of Plan Administrator. The Bank shall indemnify and hold harmless
the members of the Plan Administrator against any and all claims, losses,
damages, expenses or liabilities arising from any action or failure to act with
respect to this Agreement, except in the case of willful misconduct by the Plan
Administrator or any of its members.

5.5 Bank Information. To enable the Plan Administrator to perform its functions,
the Bank shall supply full and timely information to the Plan Administrator on
all matters relating to the date and circumstances of the Disability, death or
Separation from Service of the Executive, and such other pertinent information
as the Plan Administrator may reasonably require.

5.6 Annual Statement. The Plan Administrator shall provide to the Executive,
within one hundred twenty (120) days after the end of each Plan Year, a
statement setting forth the benefits to be distributed under this Agreement.

ARTICLE 6
CLAIMS AND REVIEW PROCEDURES

6.1 Claims Procedure. An Executive ("claimant") who has not received benefits
under the Agreement that he or she believes should be distributed shall make a
claim for such benefits as follows:

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  6.1.1 Initiation – Written Claim. The claimant initiates a claim by submitting
to the Plan Administrator a written claim for the benefits. If such a claim
relates to the contents of a notice received by the claimant, the claim must be
made within sixty (60) days after such notice was received by the claimant. All
other claims must be made within one hundred eighty (180) days of the date on
which the event that caused the claim to arise occurred. The claim must state
with particularity the determination desired by the claimant.

  6.1.2 Timing of Plan Administrator Response. The Plan Administrator shall
respond to such claimant within ninety (90) days after receiving the claim. If
the Plan Administrator determines that special circumstances require additional
time for processing the claim, the Plan Administrator can extend the response
period by an additional ninety (90) days by notifying the claimant in writing,
prior to the end of the initial ninety (90) day period, which an additional
period is required. The notice of extension must set forth the special
circumstances and the date by which the Plan Administrator expects to render its
decision.

  6.1.3 Notice of Decision. If the Plan Administrator denies part or the entire
claim, the Plan Administrator shall notify the claimant in writing of such
denial. The Plan Administrator shall write the notification in a manner
calculated to be understood by the claimant. The notification shall set forth:

  (a) The specific reasons for the denial;

  (b) A reference to the specific provisions of the Agreement on which the
denial is based;

  (c) A description of any additional information or material necessary for the
claimant to perfect the claim and an explanation of why it is needed;

  (d) An explanation of the Agreement’s review procedures and the time limits
applicable to such procedures; and

  (e) A statement of the claimant’s right to bring a civil action under ERISA
Section 502(a) following an adverse benefit determination on review.

6.2 Review Procedure. If the Plan Administrator denies part or the entire claim,
the claimant shall have the opportunity for a full and fair review by the Plan
Administrator of the denial, as follows:

  6.2.1 Initiation – Written Request. To initiate the review, the claimant,
within sixty (60) days after receiving the Plan Administrator’s notice of
denial, must file with the Plan Administrator a written request for review.

  6.2.2 Additional Submissions – Information Access. The claimant shall then
have the opportunity to submit written comments, documents, records and other
information relating to the claim. The Plan Administrator shall also provide the
claimant, upon request and free of charge, reasonable access to, and copies of,
all documents, records and other information relevant (as defined in applicable
ERISA regulations) to the claimant’s claim for benefits.

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  6.2.3 Considerations on Review. In considering the review, the Plan
Administrator shall take into account all materials and information the claimant
submits relating to the claim, without regard to whether such information was
submitted or considered in the initial benefit determination.

  6.2.4 Timing of Plan Administrator Response. The Plan Administrator shall
respond in writing to such claimant within sixty (60) days after receiving the
request for review. If the Plan Administrator determines that special
circumstances require additional time for processing the claim, the Plan
Administrator can extend the response period by an additional sixty (60) days by
notifying the claimant in writing, prior to the end of the initial sixty (60)
day period, which an additional period is required. The notice of extension must
set forth the special circumstances and the date by which the Plan Administrator
expects to render its decision.

  6.2.5 Notice of Decision. The Plan Administrator shall notify the claimant in
writing of its decision on review. The Plan Administrator shall write the
notification in a manner calculated to be understood by the claimant. The
notification shall set forth:

  (a) The specific reasons for the denial;

  (b) A reference to the specific provisions of the Agreement on which the
denial is based;

  (c) A statement that the claimant is entitled to receive, upon request and
free of charge, reasonable access to, and copies of, all documents, records and
other information relevant (as defined in applicable ERISA regulations) to the
claimant’s claim for benefits; and

  (d) A statement of the claimant’s right to bring a civil action under ERISA
Section 502(a).

ARTICLE 7
AMENDMENTS AND TERMINATION

7.1 Amendments. This Agreement may be amended only by a written agreement signed
by the Bank and the Executive. However, the Bank may unilaterally amend this
Agreement to conform with written directives to the Bank from its auditors or
banking regulators or to comply with legislative changes or tax law, including
without limitation Code Section 409A.

7.2 Plan Termination Generally. This Agreement may be terminated only by a
written agreement signed by the Bank and the Executive. The benefit shall be the
Account Value as of the date this Agreement is terminated. Except as provided in
Section 7.3, the termination of this Agreement shall not cause a distribution of
benefits under this Agreement. Rather, upon such termination benefit
distributions will be made at the

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  earliest distribution event permitted under Article 2 or Article 3.

7.2 Plan Terminations Under Code Section 409A. Notwithstanding anything to the
contrary in Section 7.2, if the Bank terminates this Agreement in the following
circumstances:

  (a)

Within thirty (30) days before, or twelve (12) months after a Change in Control,
provided that all distributions are made no later than twelve (12) months
following such termination of this Agreement and provided that all agreements,
methods, programs, and other arrangements sponsored by the Bank or the Company
immediately after the Change in Control with respect to which deferrals of
compensation are treated as having been deferred under a single plan under
§1.409A-1(c) (“Similar Arrangements”) are terminated and liquidated with respect
to each participant that experienced the Change in Control and all participants
receive all amounts of compensation deferred under this Agreement and all
Similar Arrangements within twelve (12) months of the date the Bank or Company
irrevocably takes all necessary action to terminate and liquidate this Agreement
and all Similar Arrangements;

  (b)

Upon the Bank’s dissolution or with the approval of a bankruptcy court provided
that the amounts deferred under this Agreement are included in the Executive’s
gross income in the latest of (i) the calendar year in which this Agreement
terminates; (ii) the calendar year in which the amount is no longer subject to a
substantial risk of forfeiture; or (iii) the first calendar year in which the
distribution is administratively practical; or

  (c)

Upon the Bank’s termination of this Agreement and all Similar Arrangements,
provided that (i) the termination and liquidation does not occur proximate to a
downturn in the financial health of the Bank, (ii) all termination distributions
are made no earlier than twelve (12) months and no later than twenty-four (24)
months following such termination, and (iii) the Bank does not adopt any new
arrangement that would be a Similar Arrangement for a minimum of three (3) years
following the date the Bank takes all necessary action to irrevocably terminate
and liquidate the Agreement;

  the Bank may distribute the Account Value, determined as of the date of the
termination of this Agreement, to the Executive in a lump sum subject to the
above terms.

ARTICLE 8
BENEFICIARIES

8.1 In General. The Executive shall have the right, at any time, to designate a
Beneficiary to receive any benefit distributions under this Agreement upon the
death of the Executive. The Beneficiary designated under this Agreement may be
the same as or different from the beneficiary designated under any other plan of
the Bank in which the Executive participates.

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8.2 Designation. The Executive shall designate a Beneficiary by completing and
signing the Beneficiary Designation Form and delivering it to the Plan
Administrator or its designated agent. If the Executive names someone other than
the Executive’s spouse as a Beneficiary, the Plan Administrator may, in its sole
discretion, determine that spousal consent is required to be provided in a form
designated by the Plan Administrator, executed by the Executive’s spouse and
returned to the Plan Administrator. The Executive’s beneficiary designation
shall be deemed automatically revoked if the Beneficiary predeceases the
Executive or if the Executive names a spouse as Beneficiary and the marriage is
subsequently dissolved. The Executive shall have the right to change a
Beneficiary by completing, signing and otherwise complying with the terms of the
Beneficiary Designation Form and the Plan Administrator’s rules and procedures.
Upon the acceptance by the Plan Administrator of a new Beneficiary Designation
Form, all Beneficiary designations previously filed shall be cancelled. The Plan
Administrator shall be entitled to rely on the last Beneficiary Designation Form
filed by the Executive and accepted by the Plan Administrator prior to the
Executive’s death.

8.3 Acknowledgment. No designation or change in designation of a Beneficiary
shall be effective until received, accepted and acknowledged in writing by the
Plan Administrator or its designated agent.

8.4 No Beneficiary Designation. If the Executive dies without a valid
beneficiary designation, or if all designated Beneficiaries predecease the
Executive, then the Executive’s spouse shall be the designated Beneficiary. If
the Executive has no surviving spouse, any benefit shall be paid to the
Executive’s estate.

8.5 Facility of Distribution. If the Plan Administrator determines in its
discretion that a benefit is to be distributed to a minor, to a person declared
incompetent or to a person incapable of handling the disposition of that
person’s property, the Plan Administrator may direct distribution of such
benefit to the guardian, legal representative or person having the care or
custody of such minor, incompetent person or incapable person. The Plan
Administrator may require proof of incompetence, minority or guardianship as it
may deem appropriate prior to distribution of the benefit. Any distribution of a
benefit shall be a distribution for the account of the Executive and the
Beneficiary, as the case may be, and shall completely discharge any liability
under this Agreement for such distribution amount.

ARTICLE 9
MISCELLANEOUS

9.1 Binding Effect. This Agreement shall bind the Executive and the Bank and
their beneficiaries, survivors, executors, administrators and transferees.

9.2 No Guarantee of Employment. This Agreement is not a contract for employment.
It does not give the Executive the right to remain as an employee of the Bank
nor

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  interfere with the Bank’s right to discharge the Executive. It does not
require the Executive to remain an employee nor interfere with the Executive’s
right to terminate employment at any time.

9.3 Non-Transferability. Benefits under this Agreement cannot be sold,
transferred, assigned, pledged, attached or encumbered in any manner.

9.4 Tax Withholding and Reporting. The Bank shall withhold any taxes that are
required to be withheld, including but not limited to taxes owed under Code
Section 409A from the benefits provided under this Agreement. The Executive
acknowledges that the Bank’s sole liability regarding taxes is to forward any
amounts withheld to the appropriate taxing authorities. The Bank shall satisfy
all applicable reporting requirements, including those under Code Section 409A.

9.5 Applicable Law. This Agreement and all rights hereunder shall be governed by
the laws of the State of South Carolina, except to the extent preempted by the
laws of the United States of America.

9.6 Unfunded Arrangement. The Executive and the Beneficiary are general
unsecured creditors of the Bank for the distribution of benefits under this
Agreement. The benefits represent the mere promise by the Bank to distribute
such benefits. The rights to benefits are not subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
attachment or garnishment by creditors. Any insurance on the Executive’s life or
other informal funding asset is a general asset of the Bank to which the
Executive and Beneficiary have no preferred or secured claim.

9.7 Reorganization. The Bank shall not merge or consolidate into or with another
bank, or reorganize, or sell substantially all of its assets to another bank,
firm or person unless such succeeding or continuing bank, firm or person agrees
to assume and discharge the obligations of the Bank under this Agreement. Upon
the occurrence of such an event, the term “Bank” as used in this Agreement shall
be deemed to refer to the successor or survivor entity.

9.8 Entire Agreement. This Agreement constitutes the entire agreement between
the Bank and the Executive as to the subject matter hereof. No rights are
granted to the Executive by virtue of this Agreement other than those
specifically set forth herein.

9.9 Interpretation. Wherever the fulfillment of the intent and purpose of this
Agreement requires and the context will permit, the use of the masculine gender
includes the feminine and use of the singular includes the plural.

9.10 Alternative Action. In the event it shall become impossible for the Bank or
the Plan Administrator to perform any act required by this Agreement due to
regulatory or other constraints, the Bank or Plan Administrator may perform such
alternative act as most nearly carries out the intent and purpose of this
Agreement and is in the best interests of

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Beach First National Bank

Salary Continuation Agreement

 

          the Bank, provided that such alternative act does not violate Code
Section 409A.

9.11 Headings. Article and section headings are for convenient reference only
and shall not control or affect the meaning or construction of any provision
herein.

9.12 Validity. If any provision of this Agreement shall be illegal or invalid
for any reason, said illegality or invalidity shall not affect the remaining
parts hereof, but this Agreement shall be construed and enforced as if such
illegal or invalid provision had never been included herein.

9.13 Notice. Any notice or filing required or permitted to be given to the Bank
or Plan Administrator under this Agreement shall be sufficient if in writing and
hand-delivered or sent by registered or certified mail to the address below:

    3751 Grissom Parkway         Suite 100           Myrtle Beach, SC 29577    

  Such notice shall be deemed given as of the date of delivery or, if delivery
is made by mail, as of the date shown on the postmark on the receipt for
registration or certification.

  Any notice or filing required or permitted to be given to the Executive under
this Agreement shall be sufficient if in writing and hand-delivered or sent by
mail to the last known address of the Executive.

9.12 Compliance with Section 409A. This Agreement shall be interpreted and
administered consistent with Code Section 409A.

        IN WITNESS WHEREOF, the Executive and a duly authorized representative
of the Bank have signed this Agreement.

EXECUTIVE:

BANK:

 

 

 

Beach First National Bank

 

 

/s/ Gary S. Austin

By /s/ Walter E. Standish, III

Gary S. Austin

 

 

Title President & Chief Executive Officer

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