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                                                                   Exhibit 10(a)

                       SCOTLAND SAVINGS BANK, INC., SSB
                             EMPLOYMENT AGREEMENT


     THIS AGREEMENT entered into as of March 29, 1996, by and between SCOTLAND
SAVINGS BANK, INC., SSB (hereinafter referred to as the "Savings Bank") and
WILLIAM C. FITZGERALD, III (hereinafter referred to as the "Officer") and is
joined in by SCOTLAND BANCORP, INC., the parent holding company of the Savings
Bank (hereinafter referred to as the "Holding Company").

     WHEREAS, the Officer has heretofore been employed by the Savings Bank as
its President and Chief Executive Officer; and

     WHEREAS, the Savings Bank is a state-chartered stock savings bank and the
wholly-owned subsidiary of the Holding Company; and

     WHEREAS, the Savings Bank desires to retain the services of the Officer as
the President and Chief Executive Officer of the Savings Bank upon the terms and
conditions set forth herein; and

     WHEREAS, the services of the Officer, his experience and knowledge of the
affairs of the Savings Bank, and his reputation and contacts in the industry and
the local community are extremely valuable to the Savings Bank; and

     WHEREAS, the Savings Bank wishes to attract and retain such well-qualified
executives and it is in the best interest of the Savings Bank and of the Officer
to secure the continued services of the Officer notwithstanding any change in
control of the Savings Bank or the Holding Company; and

     WHEREAS, the Savings Bank considers the establishment and maintenance of a
sound and vital management to be part of its overall corporate strategy and to
be essential to protecting and enhancing the best interests of the Holding
Company, the Savings Bank and their stockholders; and
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     WHEREAS, the parties desire to enter into this Agreement in order to set
forth the terms and conditions of the Officer's employment relationship with the
Savings Bank.

     NOW, THEREFORE, for and in consideration of the premises and mutual
promises, covenants and conditions hereinafter set forth and other good and
valuable considerations, the receipt and sufficiency of which hereby are
acknowledged, the parties hereby do agree as follows:

     1.  Employment.  The Savings Bank hereby agrees to employ the Officer and
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the Officer hereby agrees to accept employment, upon the terms and conditions
stated herein, as the President and Chief Executive Officer of the Savings Bank.
The Officer shall render such administrative and management services to the
Savings Bank as are customarily performed by persons situated in a similar
executive capacity.  The Officer shall promote the business of the Savings Bank
and perform such other duties as shall, from time to time, be reasonably
prescribed by the Board of Directors of the Savings Bank (the "Board").

     2.  Compensation.  The Savings Bank shall pay the Officer during the term
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of this Agreement, as compensation for all service rendered by him to the
Savings Bank, a base salary at the rate of $93,500 per annum, payable in cash
not less frequently than monthly; provided that the rate of such salary shall be
reviewed by the Board not less often than annually.  Such rate of salary, or
increased rate of salary, as the case may be, may be further increased, but not
decreased, from time to time in such amounts as the Board, in its discretion,
may decide.  In determining salary increases, the Board shall compensate the
Officer for increases in the cost of living and may also provide for performance
or merit increases.  Participation in incentive compensation, deferred
compensation, discretionary bonus, profit-sharing, retirement, stock option and
other employee benefit plans that the Savings Bank or the Holding Company have
adopted or may from time to time

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adopt, and participation in any fringe benefits, shall not reduce the salary
payable to the Officer under this Section.  The Officer will be entitled to such
customary fringe benefits, vacation and sick leave as are consistent with the
normal practices and established policies of the Savings Bank.

     3.  Annual Bonus. The Savings Bank agrees to pay the Officer an annual
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bonus (the "Annual Bonus"), payable on or before December 1 of each year, equal
to a certain percentage of the "Net Profit" of the Company and the Savings Bank,
on a consolidated basis, for the immediately preceding "Accounting Year".  For
the purposes of this Agreement, "Accounting Year" shall be October 1st through
September 30th of each year.  For the purposes of this Agreement, "Net Profit"
shall be the net profit of the Holding Company and the Savings Bank, on a
consolidated bases, before income taxes (as determined by the Savings Bank's
certified public accountants ("CPA's") and certified by CPA's to the Board of
Directors of the Savings Bank in the annual audit report prepared by said CPA's
and covering the subject Accounting Year).  The percentage of Net Profit the
Officer shall be entitled to receive pursuant to this Paragraph 3 shall be
calculated by the Savings Bank's CPA's using the criteria set forth on Schedule
A attached hereto and incorporated herein by reference.

     4.  Discretionary Bonuses.  During the term of this Agreement, the Officer
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shall be entitled in an equitable manner with all other key management personnel
of the Savings Bank, to such discretionary bonuses as may be authorized,
declared and paid by the Directors to the Savings Bank's key management
employees.  No other compensation provided for in this Agreement shall be deemed
a substitute for the Officer's right to such discretionary bonuses when and as
declared by the Directors.

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     5.  Participation in Retirement and Employee Benefit Plans; Fringe
         --------------------------------------------------------------
Benefits.  The Officer shall be entitled to participate in any plan relating to
--------
deferred compensation, stock awards, stock options, stock ownership plan, stock
purchases, pension, thrift, profit sharing, group life insurance, medical and
dental coverage, disability coverage, education, or other retirement or employee
benefits that the Savings Bank or the Holding Company have adopted, or may, from
time to time adopt, for benefit of their executive employees and for employees
generally, subject to the eligibility rules of such plans.

     The Officer shall also be entitled to participate in any other fringe
benefits which are now or may be or become applicable to the Officer or the
Savings Bank's other executive employees, including the payment of reasonable
expenses for attending annual and periodic meetings of trade associations, and
any other benefits which are commensurate with the duties and responsibilities
to be performed by the Officer under this Agreement.  The Savings Bank agrees to
provide the Officer with one automobile of an appropriate class and quality
owned or leased by the Savings Bank for use in connection with the Officer's
duties hereunder.  The Savings Bank further agrees to pay on behalf of the
Officer during the term of this Agreement the regular monthly dues for the
Officer's membership in the Scotch Meadows Country Club and the Laurinburg
Rotary Club.  The Savings Bank shall reimburse the Officer for all out-of-pocket
reasonable and necessary business expenses which the Officer may incur in
connection with his services on behalf of the Savings Bank. Additionally, the
Officer shall be entitled to such vacation and sick leave as shall be
established under uniform employee policies promulgated by the Directors.

     6.  Term.  The initial term of employment under this Agreement shall be for
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the period commencing upon the effective date of this Agreement and ending three
(3) calendar years from the

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effective date of this Agreement.  On each anniversary of the effective date of
this Agreement, the term of this Agreement shall automatically be extended for
an additional one year period beyond the then effective expiration date unless
written notice from the Savings Bank or the Officer is received 90 days prior to
an anniversary date advising the other party that this Agreement shall not be
further extended; provided that the Directors shall review the Officer's
performance annually and make a specific determination pursuant to such review
to renew this Agreement prior to the 90 day notice period.

     7.  Loyalty.  The Officer shall devote his full efforts and entire business
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time to the performance of his duties and responsibilities under this Agreement.

     The Officer agrees that he will hold in confidence all knowledge or
information of a confidential nature with respect to the respective businesses
of the Holding Company, the Savings Bank or of their subsidiaries, if any,
received by him during the term of this Agreement and will not disclose or make
use of such information, except in the ordinary course of his duties under this
Agreement, without the prior written consent of the Holding Company or the
Savings Bank.

     8.  Standards.  The Officer shall perform his duties and responsibilities
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under this Agreement in accordance with such reasonable standards expected of
employees with comparable positions in comparable organizations and as may be
established from time to time by the Board. The Savings Bank will provide the
Officer with the working facilities and staff customary for similar executives
and necessary for him to perform his duties.

     9.  Termination and Termination Pay.
         ------------------------------- 

     (a) The Officer's employment under this Agreement shall be terminated upon
the death of the Officer during the term of this Agreement, in which event, the
Officer's estate shall be entitled

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to receive the compensation due the Officer through the last day of the calendar
month in which his death shall have occurred and for a period of one month
thereafter.

     (b) The Officer's employment under this Agreement may be terminated at any
time by the Officer upon sixty (60) days' written notice to the Board of
Directors.  Upon such termination, the Officer shall be entitled to receive
compensation through the effective date of such termination.

     (c) In the event the Officer becomes disabled during the term of his
employment under this Agreement and it is determined by the Savings Bank that
the Officer is permanently unable to perform his duties hereunder, the Savings
Bank shall continue to compensate the Officer at the level of compensation
described in Paragraph 2 above, and shall continue to provide the Officer each
of the other benefits set forth or described in this Agreement, for the
remaining term of this Agreement, less any other payments provided under any
disability income plan of the Savings Bank which is applicable to the Officer.
In the event of any disagreement between the Officer and the Savings Bank as to
whether the Officer is physically or mentally incapacitated such as will result
in the termination of the Officer's employment pursuant to this Paragraph 9(c),
the question of such incapacity shall be submitted to an impartial and reputable
physician for determination, selected by mutual agreement of the Officer and the
Savings Bank or, failing such agreement, by two (2) physicians (one (1) of whom
shall be selected by the Savings Bank and the other by the Officer), and such
determination of the question of such incapacity by such physician or physicians
shall be final and binding on the Officer and the Savings Bank.  The Savings
Bank shall pay the reasonable fees and expenses of such physician or physicians
in making any determination required under this Paragraph 9(c).

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     (d) The Board may terminate the Officer's employment at any time, but any
termination by the Board, other than termination for cause, shall not prejudice
the Officer's right to compensation or other benefits under this Agreement for
the remaining period which would have been covered by this Agreement if such
termination had not occurred.  The Officer shall have no right to receive
compensation or other benefits for any period after termination for "cause."
Termination for "cause" shall include termination because of the Officer's
personal dishonesty, incompetence, willful misconduct, breach of fiduciary duty
involving personal profit, intentional failure to perform stated duties, willful
violation of any law, rule, regulation (other than traffic violations or similar
offenses) or final cease-and-desist order, or material breach of any provisions
of this Agreement.

     10.  Additional Regulatory Requirements.
          ---------------------------------- 

     (a) If the Officer is suspended and/or temporarily prohibited from
participating in the conduct of the Savings Bank's affairs by a notice served
under Section 8(e)(3) or Section 8(g)(1) of the Federal Deposit Insurance Act
(12 U.S.C. 1818(e)(3) and (g)(1)), the Savings Bank's obligations under this
Agreement shall be suspended as of the date of service, unless stayed by
appropriate proceedings.  If the charges in the notice are dismissed, the
Savings Bank shall (i) pay the Officer all of the compensation withheld while
its contract obligations were suspended and (ii) reinstate (in whole or in part)
any of its obligations which were suspended.

     (b) If the Officer is removed and/or permanently prohibited from
participating in the conduct of the Savings Bank's affairs by an order issued
under Section 8(e)(4) or Section 8(g)(1) of the Federal Deposit Insurance Act
(12 U.S.C. 1818(e)(4) and (g)(1)), all obligations of the Savings

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Bank under this Agreement shall terminate as of the effective date of the order,
but vested rights of the contracting parties shall not be affected.

     (c) If the Savings Bank is in default as defined in Section 3(x)(1) of the
Federal Deposit Insurance Act (12 U.S.C. (S) 1818(x)(1)), all obligations under
this Agreement shall terminate as of the date of default, but this paragraph
shall not affect any vested rights of the contracting parties.

     (d) All obligations under this Agreement shall be terminated, except to the
extent determined that continuation of the Agreement is necessary for the
continued operation of the Savings Bank, (i) by the Federal Deposit Insurance
Corporation (the "Corporation"), at the time the Corporation enters into an
agreement to provide assistance to or on behalf of the Savings Bank under the
authority contained in Section 13(c) of the Federal Deposit Insurance Act (12
U.S.C. (S) 1818(c)); or (ii) by the Administrator of the Savings Institutions
Division of the North Carolina Department of Commerce (the "Administrator"), at
the time the Administrator approves a supervisory merger to resolve problems
related to operation of the Savings Bank or when the Savings Bank is determined
by the Administrator to be in an unsafe or unsound condition.  Any rights of the
parties that have already vested, however, shall not be affected by such action.

     11.  Change in Control.
          ----------------- 

     (a)  In the event of a "Change in Control" (as defined in Subparagraph (c)
below), the term of employment under this Agreement automatically shall be
extended for a period of three (3) years beginning on the date of the Change in
Control, and the acquiror shall be bound by the terms of this Agreement and
shall be prohibited, during the remainder of such term, from:

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          (i)   Assigning Officer any duties and/or responsibilities that are
          inconsistent with his position, duties, responsibilities or status at
          the time of the Change in Control or with his reporting
          responsibilities or equivalent titles with the Savings Bank in effect
          at such time; or

          (ii)  Adjusting Officer's annual base salary rate other than in
          accordance with the provisions of Subparagraph 11(b) of this
          Agreement; or

          (iii) Failing to award any discretionary bonuses in accordance with
          Paragraph 4;

          (iv)  Reducing in level, scope or coverage or eliminating Officer's
          life insurance, medical or hospitalization insurance, disability
          insurance, profit sharing plans, stock option plans, stock purchase
          plans, deferred compensation plans, management retention plans,
          retirement plans, stock ownership plan or similar plans or benefits,
          including, without limitation, the provision of the Officer's
          automobile and payment of civic and social club dues, being provided
          by the Savings Bank or the Holding Company to the Officer as of the
          effective date of the Change in Control; or

          (v)   Transferring Officer to a location outside of Scotland County,
          North Carolina, without the Officer's express written consent.

     (b)  In the event of a Change in Control, in lieu of continuing to receive
the Annual Bonus described in Paragraph 3, the Officer's base salary shall be
adjusted to include an amount equal to the average of the two previous years'
Annual Bonus; and such adjusted base salary shall be increased by not less than
six percent (6%) annually beginning at the date of the Change in Control and
continuing each year for the three year term thereafter.

     (c)  For the purposes of this Agreement, the term "Change in Control" shall
mean any of the following events:

          (i)  a change in control of a nature that would be required to be
          reported in response to Item 1 of the Current Report on Form 8-K, as
          in effect on the date hereof, pursuant to Section 13 or 15(d) of the

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          Securities Exchange Act of 1934, as amended (the "Exchange Act"); or

          (ii)  such time as any "person" (as such term is used in Sections
          13(d) and 14(d) of the Exchange Act) is or becomes the "beneficial
          owner" (as defined in Rule 13d-3 under the Exchange Act), directly or
          indirectly, of securities of the Holding Company or Savings Bank
          representing 25 percent or more of the combined voting power of the
          outstanding Common Stock of the Holding Company or Common Stock of the
          Savings Bank, as applicable; or

          (iii) individuals who constitute the Board or board of directors of
          the Holding Company on the date hereof (the "Incumbent Board" and
          "Incumbent Holding Company Board," respectively) cease for any reason
          to constitute at least a majority thereof, provided that any person
          becoming a director subsequent to the date hereof whose election was
          approved by a vote of at least three-quarters of the directors
          comprising the Incumbent Board or Incumbent Holding Company Board, as
          applicable, or whose nomination for election by the Savings Bank's or
          Holding Company's shareholders was approved by the Savings Bank's or
          Holding Company's Board of Directors or Nominating Committee, as
          applicable, shall be considered as though he or she were a member of
          the Incumbent Board or Incumbent Holding Company Board, as applicable;
          or

          (iv)  either the Holding Company or the Savings Bank consolidates or
          merges with or into another corporation, association or entity or is
          otherwise reorganized, where neither the Holding Company nor the
          Savings Bank, respectively, is the surviving corporation in such
          transaction; or

          (v)   all or substantially all of the assets of either the Holding
          Company or the Savings Bank are sold or otherwise transferred to or
          are acquired by any other entity or group.

     Notwithstanding the other provisions of this Paragraph 11, a transaction or
event shall not be considered a Change in Control if, prior to the consummation
or occurrence of such transaction or event, Officer and Savings Bank agree in
writing that the same shall not be treated as a Change in Control for purposes
of this Agreement.

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     (d)  In the event any dispute shall arise between the Officer and the
Savings Bank as to the terms or interpretation of this Agreement, including this
Section 11, whether instituted by formal legal proceedings or otherwise,
including any action taken by the Officer to enforce the terms of this Section
11 or in defending against any action taken by the Savings Bank, the Savings
Bank shall reimburse the Officer for all costs and expenses incurred in such
proceedings or actions, including attorney's fees, in the event the Officer
prevails in any such action.

     12.  Successors and Assigns.
          ---------------------- 

     (a)  This Agreement shall inure to the benefit of and be binding upon any
corporate or other successor of the Savings Bank which shall acquire, directly
or indirectly, by conversion, merger, consolidation, purchase or otherwise, all
or substantially all of the assets of the Holding Company or the Savings Bank.

     (b)  Since the Savings Bank is contracting for the unique and personal
skills of the Officer, the Officer shall be precluded from assigning or
delegating his rights or duties hereunder without first obtaining the written
consent of the Savings Bank.

     13.  Modification; Waiver; Amendments.  No provision of this Agreement may
          --------------------------------                                     
be modified, waived or discharged unless such waiver, modification or discharge
is agreed to in writing, signed by the Officer and on behalf of the Savings Bank
by such officer as may be specifically designated by the Directors.  No waiver
by either party hereto, at any time, of any breach by the other party hereto of,
or compliance with, any condition or provision of this Agreement to be performed
by such other party shall be deemed a waiver of similar or dissimilar provisions
or conditions at the same or at any prior or subsequent time.  No amendments or
additions to this

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Agreement shall be binding unless in writing and signed by both parties, except
as herein otherwise provided.

     14.  Applicable Law.  This Agreement shall be governed in all respects
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whether as to validity, construction, capacity, performance or otherwise, by the
laws of North Carolina, except to the extent that federal law shall be deemed to
apply.

     15.  Severability.  The provisions of this Agreement shall be deemed
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severable and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions hereof.

     IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first hereinabove written.


                              SCOTLAND SAVINGS BANK, INC., SSB


                              By:/s/ James W. Mason
                                 --------------------------------------------
                                 Chairman of the Board



                              /s/ William C. Fitzgerald, III
                              -----------------------------------------(SEAL)
                              William C. Fitzgerald, III


     The foregoing Agreement is consented and agreed to by Scotland Bancorp,
Inc., the parent holding company of Scotland Savings Bank, Inc., SSB.



                              SCOTLAND BANCORP, INC.


                              By:/s/ James W. Mason
                                 --------------------------------------------
                                 Chairman of the Board

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                                  SCHEDULE A
                             ANNUAL BONUS CRITERIA

     The amount of the Annual Bonus shall be computed using criteria based on
rate of return on assets and maintenance of asset quality.

1.   Rate of Return on Assets ("ROA").

     If the ROA of the Savings Bank and the Company on a consolidated basis is:

          ROA                       Annual Bonus
          ---                       ------------

     Less than .75%                 .75% of Net Profit
 
     .75% or greater                1.00% of Net Profit
 
     In computing ROA and Net Profit, unusual or nonrecurring items, such as
gains and losses on the sale of assets and any SAIF assessment, will be
excluded.

2.   Maintenance of Asset Quality

     If nonperforming assets (loans deliquent more than 90 days plus REO) and
loan chargeoffs are:

     Nonperforming Assets
       to Total Assets               Annual Bonus
     --------------------            ------------

     Less than 1.00%                 No change in computation
     Less than 2.00% but
      more than 1.00%                Computed Annual Bonus reduced by 10%
     More than 2.00%                 Computed Annual Bonus reduced by 20%

     Loan Chargeoffs                 Annual Bonus
     ---------------                 ------------

     Less than $100,000              No change in computation
     Less than $200,000 but
      more than $100,000             Computed Annual Bonus reduced by 10%
     More than $200,000              Computed Annual Bonus reduced by 20%

For example, if based on a ROA of 1.00% the Annual Bonus was computed to be
$9,000 and the Nonperforming Assets to Total Assets was 1.5% and the Loan
Chargeoffs were $150,000, the Annual Bonus awarded to the officer would be
$7,200, a reduction of $1,800 ($900 for Nonperforming Assets and $900 for Loan
Chargeoffs).

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