<PAGE>
                                                                   Exhibit 10(c)

                          RETIREMENT PAYMENT AGREEMENT


     AGREEMENT entered into as of 1st day of April, l987 between Scotland
Savings & Loan Association, a domestic corporation having its principal office
in Laurinburg, North Carolina (hereinafter referred to as the Association) and
James S.  Mitchner of Laurinburg, North Carolina (hereinafter referred to as the
Director).

                                  WITNESSETH:

     WHEREAS, the Director is rendering valuable service and it is the desire of
the Association to have the benefit of his continued loyalty and service and
also to assist him in providing for the contingencies of retirement and death;
and,

     WHEREAS, the Director hereby agrees to waive fees paid to him as a Director
in the amount of $250.00 per month for seven years from the date of the
execution of this agreement;

     NOW THEREFORE, in consideration of the premises contained herein, the
parties hereto mutually agree as follows:

     1.  Retirement Benefit:  Should the Director still be in the Directorship
         ------------------                                                   
of the Association upon attainment of his 71st birthday, the Association will
commence to pay him $566.00 per month for a continuous period of 120 months. In
the event that the Director should die after becoming entitled to receive said
monthly installments but before any or all of said installments have been paid,
the Association will pay or will continue to pay said installments to such
beneficiary or beneficiaries as the Director has directed by filing with the
Association a notice in writing.  In the event of the death of the last named
beneficiary before all the unpaid payments have been made, the balance of any
amount which remains unpaid at said death shall be commuted on the basis of 6
percent per annum compound interest and shall be paid in a single sum to the
executor or administrator of the estate of the last named beneficiary to die.
In the absence of any such beneficiary designation, any amount remaining unpaid
at the Director's death shall be commuted on the basis of 6 percent per annum
compound interest and shall be paid in a single sum to the executor or
administrator of the Director's estate.

     2.  Death Benefit:  Should the Director die while in the Directorship of
         -------------                                                       
the Association and prior to the attainment of his 71st birthday, the
Association (beginning at a date to be determined by the Association but within
six months from the date of such death) wil1 commence to pay $566.00 per month
for a continuous period of 120 months to such beneficiary or beneficiaries as
the Director has directed by filing with the Association a notice in writing.
Irrespective of the above, however, if the Director dies as a result of suicide
within two years of the execution of this agreement, the death benefit shall not
exceed an amount equal to his waived Directors' fees plus
<PAGE>
 
interest at the rate of 7  1/2 percent per annum compounded annually.  In the
event of the death of the last named beneficiary before all the unpaid payments
have been made, the balance of any amount which remain unpaid at said death
shall be commuted on the basis of 6 percent per annum compound interest and
shall be paid in a single sum to the executor or administrator of the estate of
the last named beneficiary to die.  In the absence of any such beneficiary
designation, any amount remaining unpaid at the Director's death shall be
commuted on the basis of 6 percent per annum compound interest and shall be paid
in a single sum to the executor or administrator of the Director's estate.

     3.  Termination of Directorship:
         --------------------------- 

         A.  If the Director terminates his Directorship, for reasons other than
             death or the attainment of his 71st birthday, prior to two years
             from the execution date of this Agreement, the Director's benefits
             shall be limited to his waived Director fees plus interest at the
             rate of 7 1/2 percent per annum compounded annually and shall be
             paid in a single sum as soon as practical following the termination
             of his Directorship.

         B.  If the Director terminates his Directorship, for reasons other than
             death or the attainment of his 71st birthday, at the end of two or
             more years from the execution date of this Agreement, he or his
             beneficiary, as applicable, shall be entitled upon the attainment
             of his 71st birthday, or his prior death, to a percentage of the
             retirement benefits stated in Section 1 of this Agreement as
             determined by the following table:

<TABLE>
<CAPTION>
 
 
FULL NUMBER OF YEARS SERVED
 AS DIRECTOR FROM DATE OF                          PERCENTAGE OF RETIREMENT  
EXECUTION OF THIS AGREEMENT                      BENEFITS STATED IN SECTION 1 
   UNTIL TERMINATION OF                           OF THIS AGREEMENT TO WHICH 
      DIRECTORSHIP                                 THE DIRECTOR IS ENTITLED   
      ------------                                 ------------------------
          <S>                                                 <C>
           2                                                  20%
                                                            
           3                                                  40%
                                                            
           4                                                  60%
                                                            
           5                                                  80%
                                                            
           6                                                 100%
 
</TABLE>
<PAGE>
 
     4.  Forfeiture Provisions:
         --------------------- 

         A.  During the period the retirement benefit is payable to the Director
             under Section 1 of this Agreement, the Director shall not engage in
             business activities which are in competition with the Association
             without first obtaining the written consent of the Association.

         B.  During the period the retirement payment is payable to the Director
             under Section 1 of the Agreement, the Director shall be available
             to render consulting services to the Association upon request by an
             officer of the Association, but such request shall not be made more
             frequently than once each month. The Director shall not be
             considered to have breached this condition if he is unable to
             consult because of his mental or physical disability.

         C.  Payment of the retirement benefit under this Agreement may be
             terminated by the Association, if the Directors fails to comply
             with either of the conditions set forth in paragraph (A) and (B) of
             this Section 4.

     5.  General Provisions:
         ------------------ 

         A.  Except as otherwise provided by this Agreement, it is agreed that
             neither the Director, nor his beneficiary shall have any right to
             commute, sell, assign, transfer or otherwise convey the right to
             receive any payments hereunder, which payments and the right
             thereto are expressly declared to be nonassignable and
             nontransferable.

         B.  The benefits payable under this Agreement shall be independent of,
             and in addition to, any other employment agreements that may exist
             from time to time between the parties hereto, concerning any other
             compensation payable by the Association to the Director whether as
             salary, bonus, or otherwise. This Agreement shall not be deemed to
             constitute a contract of employment between the parties hereto, nor
             shall any provision hereof restrict the right of the Association to
             discharge the Director or restrict the right of the Association to
             discharge the Director or restrict the right of the Director to
             terminate his Directorship.

         C.  The rights of the Director under this Agreement and of any
             beneficiary of the Director shall be solely those of an unsecured
             creditor of the Association. Any asset acquired by the Association
             in connection with the liabilities assumed by it hereunder, shall
             not be deemed to be held under any trust for
<PAGE>
 
             the benefit of the Director or his beneficiaries or to be
             considered security for the performance of the obligations of the
             Association but shall be, and remain, a general, unpledged,
             unrestricted asset of the Association.

         D.  The Association hereby reserves the right to accelerate the
             payments specified in Sections 1, 2 and 3 above without the consent
             of the Director, his estate, beneficiaries, or other person
             claiming through or under him.

         E.  The Association agrees that it will not merge or consolidate with
             any other Association or organization, or permit its business
             activities to be taken over by any other organization unless and
             until the succeeding or continuing Association or other
             organization shall expressly assume the rights and obligations of
             the Association herein set forth. The Association further agrees
             that it will not cease its business activities or terminate its
             existence, other than as heretofore set forth in this Section,
             without having made adequate provision for the fulfilling of its
             obligations hereunder.

         F.  This Agreement may be revoked or amended in whole or in part by a
             writing signed by both of the parties hereto.

         G.  Thin Agreement shall be subject to and construed under the laws of
             the State of North Carolina.

     IN WITNESS WHEREOF, the said Association has caused this agreement to be
signed in its Corporate name by its duly authorized officer, and impressed with
its corporate seal, attested by its Secretary, and the said Director has
hereunto set his hand and seal, all on the day and year first above written.




                          SCOTLAND SAVINGS & LOAN ASSOCIATION

                          By:/s/ George W. Thomas       (SEAL)
                             ---------------------------
                                 President


                             /s/ James E. Mitchener     (SEAL)
                             ---------------------------
                                 (The Director)
ATTEST:

/s/ Deane B. Phillips
------------------------------------

WITNESS: /s/ Freddie C. Davis
         ---------------------------
<PAGE>
 
                          BENEFICIARY DESIGNATION FORM


     As Beneficiary to receive any death benefits payable on my behalf from
Scotland Savings and Loan Association, I designate the following:

PRIMARY
-------
                              DATE OF
          NAME                BIRTH            ADDRESS          RELATIONSHIP
          ----                -----            -------          ------------

     Sara C.  Mitchener       2-23-1925        Morison Lane         Wife



CONTINGENT, If Any:
------------------ 


(Note: If more than one primary beneficiary is named, the benefit will be paid
in equal shares to those living.  Should the contingent beneficiaries be
eligible to receive the benefits, such benefits will be paid in equal shares to
such living contingent beneficiaries.  If none of the designated beneficiaries
as living at such time as the death benefit is payable, such benefit will be
paid to the Executor or Administrator of your Estate.)


Name of Spouse if not given above:
                                  --------------------------------------------- 


/s/ Deane B. Phillips                             /s/ James S. Mitchener
------------------------------                    -----------------------------
Witness                                               Signature of Director

                                                  7-9-87
                                                  -----------------------------
                                                  Date
<PAGE>
 
                          RETIREMENT PAYMENT AGREEMENT


     AGREEMENT entered into as of 1st day of April, l987 between Scotland
Savings & Loan Association, a domestic corporation having its principal office
in Laurinburg, North Carolina (hereinafter referred to as the Association) and
James E.  Milligan of Laurinburg, North Carolina (hereinafter referred to as the
Director).

                                  WITNESSETH:

     WHEREAS, the Director is rendering valuable service and it is the desire of
the Association to have the benefit of his continued loyalty and service and
also to assist him in providing for the contingencies of retirement and death;
and,

     WHEREAS, the Director hereby agrees to waive fees paid to him as a Director
in the amount of $250.00 per month for seven years from the date of the
execution of this agreement;

     NOW THEREFORE, in consideration of the premises contained herein, the
parties hereto mutually agree as follows:

     1.  Retirement Benefit:  Should the Director still be in the Directorship
         ------------------                                                   
of the Association upon attainment of his 69th birthday, the Association will
commence to pay him $647.00 per month for a continuous period of 120 months. In
the event that the Director should die after becoming entitled to receive said
monthly installments but before any or all of said installments have been paid,
the Association will pay or will continue to pay said installments to such
beneficiary or beneficiaries as the Director has directed by filing with the
Association a notice in writing.  In the event of the death of the last named
beneficiary before all the unpaid payments have been made, the balance of any
amount which remains unpaid at said death shall be commuted on the basis of 6
percent per annum compound interest and shall be paid in a single sum to the
executor or administrator of the estate of the last named beneficiary to die.
In the absence of any such beneficiary designation, any amount remaining unpaid
at the Director's death shall be commuted on the basis of 6 percent per annum
compound interest and shall be paid in a single sum to the executor or
administrator of the Director's estate.

     2.  Death Benefit:  Should the Director die while in the Directorship of
         -------------                                                       
the Association and prior to the attainment of his 69th birthday, the
Association (beginning at a date to be determined by the Association but within
six months from the date of such death) wil1 commence to pay $647.00 per month
for a continuous period of 120 months to such beneficiary or beneficiaries as
the Director has directed by filing with the Association a notice in writing.
Irrespective of the above, however, if the Director dies as a result of suicide
within two years of the execution of this agreement, the death benefit shall not
exceed an amount equal to his waived Directors' fees plus
<PAGE>
 
interest at the rate of 7  1/2 percent per annum compounded annually.  In the
event of the death of the last named beneficiary before all the unpaid payments
have been made, the balance of any amount which remain unpaid at said death
shall be commuted on the basis of 6 percent per annum compound interest and
shall be paid in a single sum to the executor or administrator of the estate of
the last named beneficiary to die.  In the absence of any such beneficiary
designation, any amount remaining unpaid at the Director's death shall be
commuted on the basis of 6 percent per annum compound interest and shall be paid
in a single sum to the executor or administrator of the Director's estate.

     3.  Termination of Directorship:
         --------------------------- 

         A.  If the Director terminates his Directorship, for reasons other than
             death or the attainment of his 69th birthday, prior to two years
             from the execution date of this Agreement, the Director's benefits
             shall be limited to his waived Director fees plus interest at the
             rate of 7 1/2 percent per annum compounded annually and shall be
             paid in a single sum as soon as practical following the termination
             of his Directorship.

         B.  If the Director terminates his Directorship, for reasons other than
             death or the attainment of his 69th birthday, at the end of two or
             more years from the execution date of this Agreement, he or his
             beneficiary, as applicable, shall be entitled upon the attainment
             of his 69th birthday, or his prior death, to a percentage of the
             retirement benefits stated in Section 1 of this Agreement as
             determined by the following table:
<TABLE>
<CAPTION>
 
 
FULL NUMBER OF YEARS SERVED
 AS DIRECTOR FROM DATE OF                        PERCENTAGE OF RETIREMENT  
EXECUTION OF THIS AGREEMENT                     BENEFITS STATED IN SECTION 1 
   UNTIL TERMINATION OF                          OF THIS AGREEMENT TO WHICH 
      DIRECTORSHIP                                 THE DIRECTOR IS ENTITLED   
      ------------                                 ------------------------
          <S>                                                 <C>
           2                                                  20%
                                                             
           3                                                  40%
                                                             
           4                                                  60%
                                                             
           5                                                  80%
                                                             
           6                                                 100%
 
</TABLE>
<PAGE>
 
     4.  Forfeiture Provisions:
         --------------------- 

         A.  During the period the retirement benefit is payable to the Director
             under Section 1 of this Agreement, the Director shall not engage in
             business activities which are in competition with the Association
             without first obtaining the written consent of the Association.

         B.  During the period the retirement payment is payable to the Director
             under Section 1 of the Agreement, the Director shall be available
             to render consulting services to the Association upon request by an
             officer of the Association, but such request shall not be made more
             frequently than once each month. The Director shall not be
             considered to have breached this condition if he is unable to
             consult because of his mental or physical disability.

         C.  Payment of the retirement benefit under this Agreement may be
             terminated by the Association, if the Directors fails to comply
             with either of the conditions set forth in paragraph (A) and (B) of
             this Section 4.

     5.  General Provisions:
         ------------------ 

         A.  Except as otherwise provided by this Agreement, it is agreed that
             neither the Director, nor his beneficiary shall have any right to
             commute, sell, assign, transfer or otherwise convey the right to
             receive any payments hereunder, which payments and the right
             thereto are expressly declared to be nonassignable and
             nontransferable.

         B.  The benefits payable under this Agreement shall be independent of,
             and in addition to, any other employment agreements that may exist
             from time to time between the parties hereto, concerning any other
             compensation payable by the Association to the Director whether as
             salary, bonus, or otherwise. This Agreement shall not be deemed to
             constitute a contract of employment between the parties hereto, nor
             shall any provision hereof restrict the right of the Association to
             discharge the Director or restrict the right of the Association to
             discharge the Director or restrict the right of the Director to
             terminate his Directorship.

         C.  The rights of the Director under this Agreement and of any
             beneficiary of the Director shall be solely those of an unsecured
             creditor of the Association. Any asset acquired by the Association
             in connection with the liabilities assumed by it hereunder, shall
             not be deemed to be held under any trust for
<PAGE>
 
             the benefit of the Director or his beneficiaries or to be
             considered security for the performance of the obligations of the
             Association but shall be, and remain, a general, unpledged,
             unrestricted asset of the Association.

         D.  The Association hereby reserves the right to accelerate the
             payments specified in Sections 1, 2 and 3 above without the consent
             of the Director, his estate, beneficiaries, or other person
             claiming through or under him.

         E.  The Association agrees that it will not merge or consolidate with
             any other Association or organization, or permit its business
             activities to be taken over by any other organization unless and
             until the succeeding or continuing Association or other
             organization shall expressly assume the rights and obligations of
             the Association herein set forth. The Association further agrees
             that it will not cease its business activities or terminate its
             existence, other than as heretofore set forth in this Section,
             without having made adequate provision for the fulfilling of its
             obligations hereunder.

         F.  This Agreement may be revoked or amended in whole or in part by a
             writing signed by both of the parties hereto.

         G.  Thin Agreement shall be subject to and construed under the laws of
             the State of North Carolina.

     IN WITNESS WHEREOF, the said Association has caused this agreement to be
signed in its Corporate name by its duly authorized officer, and impressed with
its corporate seal, attested by its Secretary, and the said Director has
hereunto set his hand and seal, all on the day and year first above written.


                          SCOTLAND SAVINGS & LOAN ASSOCIATION

                          By:/s/ George W. Thomas       (SEAL)
                             ---------------------------
                                 President


                             /s/ James E. Milligan      (SEAL)
                             ---------------------------
                                 (The Director)
ATTEST:

/s/ Deane B. Phillips
------------------------------------

WITNESS: /s/ Freddie C. Davis
         ---------------------------
<PAGE>
 
                          BENEFICIARY DESIGNATION FORM


     As Beneficiary to receive any death benefits payable on my behalf from
Scotland Savings and Loan Association, I designate the following:

PRIMARY
-------
                              DATE OF
          NAME                BIRTH            ADDRESS              RELATIONSHIP
          ----                -----            -------              ------------

     Doris B. Milligan        5/11/1928        1205 Dunbar Drive        Wife 
 
                                               Laurinburg, N.C.


CONTINGENT, If Any:
------------------ 

     Michael E.  Milligan                                               Son   
                                                                        
     Stephen F.  Milligan                                               Son   
                                                                        
     Kathy V.  Milligan                                                 Daughter


(Note: If more than one primary beneficiary is named, the benefit will be paid
in equal shares to those living.  Should the contingent beneficiaries be
eligible to receive the benefits, such benefits will be paid in equal shares to
such living contingent beneficiaries.  If none of the designated beneficiaries
as living at such time as the death benefit is payable, such benefit will be
paid to the Executor or Administrator of your Estate.)

Name of Spouse if not given above:
                                  ----------------------------------------------

/s/ Deane B. Phillips                              /s/ James E. Milligan 
-------------------------                          --------------------------
Witness                                            Signature of Director

                                                   7-9-87
                                                   --------------------------
                                                   Date
<PAGE>
 
                          RETIREMENT PAYMENT AGREEMENT


     AGREEMENT entered into as of 1st day of April, l987 between Scotland
Savings & Loan Association, a domestic corporation having its principal office
in Laurinburg, North Carolina (hereinafter referred to as the Association) and
Sam T.  Snowdon, Jr. of Laurinburg, North Carolina (hereinafter referred to as
the Director).

                                  WITNESSETH:

     WHEREAS, the Director is rendering valuable service and it is the desire of
the Association to have the benefit of his continued loyalty and service and
also to assist him in providing for the contingencies of retirement and death;
and,

     WHEREAS, the Director hereby agrees to waive fees paid to him as a Director
in the amount of $250.00 per month for seven years from the date of the
execution of this agreement;

     NOW THEREFORE, in consideration of the premises contained herein, the
parties hereto mutually agree as follows:

     1.  Retirement Benefit:  Should the Director still be in the Directorship
         ------------------                                                   
of the Association upon attainment of his 67th birthday, the Association will
commence to pay him $735.00 per month for a continuous period of 120 months. In
the event that the Director should die after becoming entitled to receive said
monthly installments but before any or all of said installments have been paid,
the Association will pay or will continue to pay said installments to such
beneficiary or beneficiaries as the Director has directed by filing with the
Association a notice in writing.  In the event of the death of the last named
beneficiary before all the unpaid payments have been made, the balance of any
amount which remains unpaid at said death shall be commuted on the basis of 6
percent per annum compound interest and shall be paid in a single sum to the
executor or administrator of the estate of the last named beneficiary to die.
In the absence of any such beneficiary designation, any amount remaining unpaid
at the Director's death shall be commuted on the basis of 6 percent per annum
compound interest and shall be paid in a single sum to the executor or
administrator of the Director's estate.

     2.  Death Benefit:  Should the Director die while in the Directorship of
         -------------                                                       
the Association and prior to the attainment of his 67th birthday, the
Association (beginning at a date to be determined by the Association but within
six months from the date of such death) wil1 commence to pay $735.00 per month
for a continuous period of 120 months to such beneficiary or beneficiaries as
the Director has directed by filing with the Association a notice in writing.
Irrespective of the above, however, if the Director dies as a result of suicide
within two years of the execution of this agreement, the death benefit shall not
exceed an amount equal to his waived Directors' fees plus
<PAGE>
 
interest at the rate of 7  1/2 percent per annum compounded annually.  In the
event of the death of the last named beneficiary before all the unpaid payments
have been made, the balance of any amount which remain unpaid at said death
shall be commuted on the basis of 6 percent per annum compound interest and
shall be paid in a single sum to the executor or administrator of the estate of
the last named beneficiary to die.  In the absence of any such beneficiary
designation, any amount remaining unpaid at the Director's death shall be
commuted on the basis of 6 percent per annum compound interest and shall be paid
in a single sum to the executor or administrator of the Director's estate.

     3.  Termination of Directorship:
         --------------------------- 

         A.  If the Director terminates his Directorship, for reasons other than
             death or the attainment of his 67th birthday, prior to two years
             from the execution date of this Agreement, the Director's benefits
             shall be limited to his waived Director fees plus interest at the
             rate of 7 1/2 percent per annum compounded annually and shall be
             paid in a single sum as soon as practical following the termination
             of his Directorship.

         B.  If the Director terminates his Directorship, for reasons other than
             death or the attainment of his 67th birthday, at the end of two or
             more years from the execution date of this Agreement, he or his
             beneficiary, as applicable, shall be entitled upon the attainment
             of his 67th birthday, or his prior death, to a percentage of the
             retirement benefits stated in Section 1 of this Agreement as
             determined by the following table:
<TABLE>
<CAPTION>
 
 
FULL NUMBER OF YEARS SERVED
 AS DIRECTOR FROM DATE OF          PERCENTAGE OF RETIREMENT
EXECUTION OF THIS AGREEMENT      BENEFITS STATED IN SECTION 1
   UNTIL TERMINATION OF           OF THIS AGREEMENT TO WHICH
      DIRECTORSHIP                 THE DIRECTOR IS ENTITLED
      ------------                 ------------------------
 <S>                             <C>
            2                                 20%
            3                                 40%
            4                                 60%
            5                                 80%
            6                                100%
 
</TABLE>
<PAGE>
 
     4.  Forfeiture Provisions:
         --------------------- 

         A.  During the period the retirement benefit is payable to the Director
             under Section 1 of this Agreement, the Director shall not engage in
             business activities which are in competition with the Association
             without first obtaining the written consent of the Association.

         B.  During the period the retirement payment is payable to the Director
             under Section 1 of the Agreement, the Director shall be available
             to render consulting services to the Association upon request by an
             officer of the Association, but such request shall not be made more
             frequently than once each month. The Director shall not be
             considered to have breached this condition if he is unable to
             consult because of his mental or physical disability.

         C.  Payment of the retirement benefit under this Agreement may be
             terminated by the Association, if the Directors fails to comply
             with either of the conditions set forth in paragraph (A) and (B) of
             this Section 4.

     5.  General Provisions:
         ------------------ 

         A.  Except as otherwise provided by this Agreement, it is agreed that
             neither the Director, nor his beneficiary shall have any right to
             commute, sell, assign, transfer or otherwise convey the right to
             receive any payments hereunder, which payments and the right
             thereto are expressly declared to be nonassignable and
             nontransferable.

         B.  The benefits payable under this Agreement shall be independent of,
             and in addition to, any other employment agreements that may exist
             from time to time between the parties hereto, concerning any other
             compensation payable by the Association to the Director whether as
             salary, bonus, or otherwise. This Agreement shall not be deemed to
             constitute a contract of employment between the parties hereto, nor
             shall any provision hereof restrict the right of the Association to
             discharge the Director or restrict the right of the Association to
             discharge the Director or restrict the right of the Director to
             terminate his Directorship.

         C.  The rights of the Director under this Agreement and of any
             beneficiary of the Director shall be solely those of an unsecured
             creditor of the Association. Any asset acquired by the Association
             in connection with the liabilities assumed by it hereunder, shall
             not be deemed to be held under any trust for
<PAGE>
 
              the benefit of the Director or his beneficiaries or to be
              considered security for the performance of the obligations of the
              Association but shall be, and remain, a general, unpledged,
              unrestricted asset of the Association.

          D.  The Association hereby reserves the right to accelerate the
              payments specified in Sections 1, 2 and 3 above without the
              consent of the Director, his estate, beneficiaries, or any other
              person claiming through or under him.

          E.  The Association agrees that it will not merge or consolidate with
              any other Association or organization, or permit its business
              activities to be taken over by any other organization unless and
              until the succeeding or continuing Association or other
              organization shall expressly assume the rights and obligations of
              the Association herein set forth. The Association further agrees
              that it will not cease its business activities or terminate its
              existence, other than as heretofore set forth in this Section,
              without having made adequate provision for the fulfilling of its
              obligations hereunder.

          F.  This Agreement may be revoked or amended in whole or in part by a
              writing signed by both of the parties hereto.

          G.  This Agreement shall be subject to and construed under the laws of
              the State of North Carolina.

     IN WITNESS THEREOF, the said Association has caused this agreement to be
signed in its Corporate name by its duly authorized officer, and impressed with
its corporate seal, attested by its Secretary, and the said Director has
hereunto set his hand and seal, all on the day and year first above written.


                                       SCOTLAND SAVINGS & LOAN ASSOCIATION

                                       By: /s/ George W. Thomas          (SEAL)
                                          -------------------------------
                                               President

                                          /s/ Sam T. Snowdon, Jr.        (SEAL)
                                          -------------------------------
                                                (The Director)
ATTEST:

/s/ Deane B. Phillips
-----------------------------

WITNESS: /s/ Freddie C. Davis
        ---------------------
<PAGE>
 
                          BENEFICIARY DESIGNATION FORM


     As Beneficiary to receive any death benefits payable on my behalf from
Scotland Savings and Loan Association, I designate the following:

PRIMARY
-------
                           DATE OF     
          NAME             BIRTH        ADDRESS             RELATIONSHIP 
          ----             -----        -------             ------------  
                                       
     Mildred B. Snowdon    8-30-1929    721 King Street           Wife
                                        Laurinburg, N.C. 


CONTINGENT, If Any:
------------------ 


(Note: If more than one primary beneficiary is named, the benefit will be paid
in equal shares to those living.  Should the contingent beneficiaries be
eligible to receive the benefits, such benefits will be paid in equal shares to
such living contingent beneficiaries.  If none of the designated beneficiaries
as living at such time as the death benefit is payable, such benefit will be
paid to the Executor or Administrator of your Estate.)

Name of Spouse if not given above:
                                  ----------------------------------------------

/s/ Deane B. Phillips                         /s/ Sam T. Snowdon, Jr.       
------------------------------------          ----------------------------------
Witness                                       Signature of Director

                                              7-9-87
                                              ----------------------------------
                                              Date