<PAGE>
 
                                                                Exhibit (10)(vi)

                         SUPPLEMENTAL INCOME AGREEMENT

     AGREEMENT entered into as of the first day of October, 1985 between Home
Savings and Loan Association, a domestic Corporation having its principal office
in Albemarle, NC (hereinafter referred to as the Company) and Robert Ronald
Swanner of Albemarle, North Carolina (hereinafter referred to as the Employee).

                                  WITNESSETH:

     WHEREAS the Employee has been employed by the Company since 4/22/74 and is
now employed in the capacity of Executive Vice President; and,

     WHEREAS, the performance of the Employee is such that assurance of his
continued services is essential to the future growth and profits of the Company;
and,

     WHEREAS, the Company desires to retain the services of the Employee, and
realizes that if the Employee were to leave the Company it would suffer a
substantial financial loss; and,

     WHEREAS, the Employee is willing to continue in the employ of the Company
if the Company will agree to pay to the Employee or his designees certain
benefits in accordance with the provisions and conditions hereinafter set forth;

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

     1.  Remuneration: During the period of the Employee's employment with the
         ------------                                                         
         Company, the Company will pay the Employee for services to be rendered:

         A.  Cash amounts at rates and times mutually agreed upon; and,

         B.  Additional amounts, payment of which will be deferred pursuant to
             the terms hereinafter set forth.

     2.  Retirement Benefit: Upon attainment of the first day of the month
         ------------------                                               
         following the employee's 65th birthday, the Company will commence to
         pay him $861 per month for a continuous period of 180 months. However,
         any amount payable under this Section shall be reduced by any
         disability payments already paid under Section 4 of this agreement. In
         the event that the Employee shall die after becoming entitled to
         receive said monthly installments but before any or all of said
         installments have been paid, the Company will pay or will continue to
         pay said installments to such beneficiary or beneficiaries as the
         Employee has directed by filing with the Company a notice in writing.
         In the event of the death of the last named beneficiary before all
         unpaid payments have been made, the balance of any amount which remains
         unpaid at said death shall be commuted on the basis of 9 percent per
         annum compound interest and shall be paid in a single sum to the
         executor or administrator of the estate
<PAGE>
 
         of the last named beneficiary to die. In the absence of any such
         beneficiary designation, any amount remaining unpaid at the Employee's
         death shall be commuted on the basis of 9 percent per annum compound
         interest and shall be paid in a single sum to the executor or
         administrator of the Employee's estate.

     3.  Death Benefit: Should the Employee die while in the employment of the
         -------------                                                        
         Company and prior to the attainment of the first day of the month
         following his 65th birthday, the Company (beginning at a date to be
         determined by the Company but within six months from the date of such
         death) will commence to pay $861 per month for a continuous period of
         180 months to such beneficiary or beneficiaries as the Employee has
         directed by filing with the Company a notice in writing. However, any
         amount payable under this Section shall be reduced by any disability
         payments already paid under Section 4 of this agreement. Irrespective
         of the above, however, if the Employee dies as a result of suicide
         within two years of the execution of this Agreement, no death benefit
         shall be payable. 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 9 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 Employee's death shall
         be commuted on the basis of 9 percent per annum compound interest and
         shall be paid in a single sum to the executor or administrators of the
         Employee's estate.

     4.  Disability Benefit:
         -------------------

         A.  If the Employee shall become disabled-(as defined in paragraph B of
             this Section 4) prior to the attainment of his 65th birthday and
             prior to his termination of employment, the Company shall commence
             to pay him $861 per month for a continuous period of 180 months. In
             the event that the Employee should die after becoming entitled to
             receive said monthly installments but before any or all of said
             installments have been paid, the Company will pay or will continue
             to pay said installments to such beneficiary or beneficiaries as
             the Employee has directed by filing with the Company 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 9 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
             Employee's death shall be commuted on the basis of 9 percent per
             annum compound interest and shall be paid in a single sum to the
             executor or administrator of the Employee's estate.
<PAGE>
 
         B.  The Employee shall be considered disabled for the purposes of this
             Agreement if he is unable to perform the duties of his position for
             a continuous period of 6 months or more. During such 6 month
             period, the Employee must be under the regular care of a State
             licensed medical doctor (M.D.) or osteopathic physician (D.O.). For
             the purposes of this Section, or any other Section relating to
             disability, if there is any dispute between the parties as to the
             Employee's physical or mental disability, the question shall be
             settled by the opinion of a medical doctor or osteopathic physician
             licensed by the state in which this Agreement is signed and who is
             selected by the mutual consent of the parties to this Agreement or
             their representatives. If the parties cannot agree within ten days
             after a written request for the designation of an examining
             physician is made by either party to the other, then the examining
             physician shall be designated by the then President of the Stanly
             County Medical Society. Certification of that physician as to the
             matter in dispute shall be final and binding upon the parties.

     5.  Early Retirement Benefit: In event the Employee's employment with the
         ------------------------                                             
         Company terminates for any reason other than disability, death, or the
         attainment of his 65th birthday, and on such termination date the
         employee has 30 years of employment with the Company, the employee
         shall be entitled to the monthly income stipulated in Section 2 of this
         Agreement, reduced by 4% for each year the employee is younger than age
         65 when such income begins. Such payments shall begin on a date to be
         determined by the Company, but within six months from the date of
         termination. However, any amount payable under this Section shall be
         reduced by any disability payments already paid under Section 4 of this
         Agreement. In the event that the Employee shall die after becoming
         entitled to receive said monthly installments but before any or all of
         said installments have been paid, the Company will pay or will continue
         to pay said installments to such beneficiary or beneficiaries as the
         Employee has directed by filing with the Company a notice in writing.
         In the event of the death of the last named beneficiary before all
         unpaid payments have been made, the balance of any amount which remains
         unpaid at said death shall be commuted on the basis of 9 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 Employee's death shall be commuted on the basis
         of 9 percent per annum compound interest and shall be paid in a single
         sum to the executor or administrator of the Employee's estate.

     6.  Forfeiture Provisions:
         ----------------------

         A.  During the period the retirement benefit is payable to the Employee
             under Section 2 or Section 5 of this Agreement, the Employee shall
             not engage in business activities in Stanly County North Carolina
             which are in competition with the Company without first obtaining
             the written consent of the Company.
<PAGE>
 
         B.  During the period the retirement benefit is payable to the Employee
             under Section 2 or Section 5 of the Agreement, the Employee shall
             be available to render consulting services to the Company upon
             request by an officer of the Company, but such requests shall not
             be made more frequently than once each month. The Employee 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 Company, if the Employee fails to comply with
             either of the conditions set forth in paragraph (A) and (B) of this
             Section 6.

     7.  General Provisions:
         ------------------ 

         A.  Except as otherwise provided by this Agreement, it is agreed that
             neither the Employee, 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 Company to the Employee 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 Company to
             discharge the Employee or restrict the right of the Employee to
             terminate his employment.

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

         D.  The Company hereby reserves the right to accelerate the payments
             specified in Sections 2, 3, 4 and 5 above without the consent of
             the Employee, his estate, beneficiaries, or any other person
             claiming through or under him.

         E.  The Company agrees that it will not merge or consolidate with any
             other Company or organization, or permit its business activities to
             be taken over by any other organization unless and until the
             succeeding or continuing Company or other organization shall
             expressly assume the rights and
<PAGE>
 
             obligations of the Company herein set forth. The Company further
             agrees that it will not cease its business activities or terminate
             its existence, other than as heretofore set forth in the 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 Company 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 Employee has hereunto
set his hand and seal, all on the day and year first above written.

ATTEST:                                HOME SAVINGS AND LOAN ASSOCIATION,
                                       ALBEMARLE, NC

/s/ Sheila S. Barbee                   By /s/ Carl M. Hill, President    (Seal)
---------------------------------         ------------------------------- 


WITNESS:/s/ Bobby Doby, Jr.               /s/ R. Ronald Swanner          (Seal)
        -------------------------         -------------------------------  
                                                (The Employee)
<PAGE>
 
                         BENEFICIARY DESIGNATION FORM

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

<TABLE> 
<CAPTION> 
            NAME         DATE OF BIRTH     ADDRESS            RELATIONSHIP
            ----         -------------     -------            ------------
<S>                      <C>               <C>                <C>   

PRIMARY:
------- 

         Beth M. Swanner   10/13/49   1415 Northridge Drive, Albemarle, NC  Wife
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

CONTINGENT, If Any:

   Mary Leslie Swanner    3/14/71    1415 Northridge Drive, Albemarle, NC   Daughter
------------------------------------------------------------------------------------
   Ashley Leigh Swanner   7/19/76    1415 Northridge Drive, Albemarle, NC   Daughter
------------------------------------------------------------------------------------

------------------------------------------------------------------------------------
</TABLE> 

(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 are
living at such time as the death benefit is payable, such benefit will be paid
to the Executor or the Administrator of your Estate.)

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

/s/ Bobby Doby, Jr.                    /s/ Robert Ronald Swanner
---------------------------------      ----------------------------------------
Witness                                Signature of Employee


                                       October 1, 1985
                                       ----------------------------------------
                                       Date


Note: The original should be retained by the Company and one copy by the
Employee.
<PAGE>
 
                         SUPPLEMENTAL INCOME AGREEMENT


     AGREEMENT entered into as of the first day of October, 1985 between Home
Savings and Loan Association , a domestic Corporation having its principal
office in Albemarle, NC (hereinafter referred to as the Company) and Carl Melvin
Hill of Albemarle, North Carolina (hereinafter referred to as the Employee).

                                  WITNESSETH:

     WHEREAS the Employee has been employed by the Company since 5/1/57 and is
now employed in the capacity of President; and,

     WHEREAS, the performance of the Employee is such that assurance of his
continued services is essential to the future growth and profits of the Company;
and,

     WHEREAS, the Company desires to retain the services of the Employee, and
realizes that if the Employee were to leave the Company it would suffer a
substantial financial loss; and,

     WHEREAS, the Employee is willing to continue in the employ of the Company
if the Company will agree to pay to the Employee or his designees certain
benefits in accordance with the provisions and conditions hereinafter set forth;

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

     1.  Remuneration: During the period of the Employee's employment with the
         ------------                                                         
         Company, the Company will pay the Employee for services to be rendered:

         A.  Cash amounts at rates and times mutually agreed upon; and,

         B.  Additional amounts, payment of which will be deferred pursuant to
             the terms hereinafter set forth.

     2.  Retirement Benefit: Upon attainment of the first day of the month
         ------------------                                               
         following the employee's 65th birthday, the Company will commence to
         pay him $1,200 per month for a continuous period of 180 months.
         However, any amount payable under this Section shall be reduced by any
         disability payments already paid under Section 4 of this agreement. In
         the event that the Employee shall die after becoming entitled to
         receive said monthly installments but before any or all of said
         installments have been paid, the Company will pay or will continue to
         pay said installments to such beneficiary or beneficiaries as the
         Employee has directed by filing with the Company a notice in writing.
         In the event of the death of the last named beneficiary before all
         unpaid payments have been made, the balance of any amount which remains
         unpaid at said death shall be commuted on the basis of 9 percent per
         annum compound interest and shall be paid in a single sum to the
         executor or administrator of the estate
<PAGE>
 
         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 Employee's death shall be commuted on the basis of 9
         percent per annum compound interest and shall be paid in a single sum
         to the executor or administrator of the Employee's estate.

     3.  Death Benefit: Should the Employee die while in the employment of the
         -------------                                                        
         Company and prior to the attainment of the first day of the month
         following his 65th birthday, the Company (beginning at a date to be
         determined by the Company but within six months from the date of such
         death) will commence to pay $ 1,200 per month for a continuous period
         of 180 months to such beneficiary or beneficiaries as the Employee has
         directed by filing with the Company a notice in writing. However, any
         amount payable under this Section shall be reduced by any disability
         payments already paid under Section 4 of this agreement. Irrespective
         of the above, however, if the Employee dies as a result of suicide
         within two years of the execution of this Agreement, no death benefit
         shall be payable. 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 9 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 Employee's death shall
         be commuted on the basis of 9 percent per annum compound interest and
         shall be paid in a single sum to the executor or administrators of the
         Employee's estate.

     4.  Disability Benefit:
         -------------------

         A.  If the Employee shall become disabled-(as defined in paragraph B of
             this Section 4) prior to the attainment of his 65th birthday and
             prior to his termination of employment, the Company shall commence
             to pay him $1,200 per month for a continuous period of 180 months.
             In the event that the Employee should die after becoming entitled
             to receive said monthly installments but before any or all of said
             installments have been paid, the Company will pay or will continue
             to pay said installments to such beneficiary or beneficiaries as
             the Employee has directed by filing with the Company 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 9 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
             Employee's death shall be commuted on the basis of 9 percent per
             annum compound interest and shall be paid in a single sum to the
             executor or administrator of the Employee's estate.
<PAGE>
 
         B.  The Employee shall be considered disabled for the purposes of this
             Agreement if he is unable to perform the duties of his position for
             a continuous period of 6 months or more. During such 6 month
             period, the Employee must be under the regular care of a State
             licensed medical doctor (M.D.) or osteopathic physician (D.O.). For
             the purposes of this Section, or any other Section relating to
             disability, if there is any dispute between the parties as to the
             Employee's physical or mental disability, the question shall be
             settled by the opinion of a medical doctor or osteopathic physician
             licensed by the state in which this Agreement is signed and who is
             selected by the mutual consent of the parties to this Agreement or
             their representatives. If the parties cannot agree within ten days
             after a written request for the designation of an examining
             physician is made by either party to the other, then the examining
             physician shall be designated by the then President of the Stanly
             County Medical Society. Certification of that physician as to the
             matter in dispute shall be final and binding upon the parties.

     5.  Early Retirement Benefit: In event the Employee's employment with the
         ------------------------                                             
         Company terminates for any reason other than disability, death, or the
         attainment of his 65th birthday, and on such termination date the
         employee has 30 years of employment with the Company, the employee
         shall be entitled to the monthly income stipulated in Section 2 of this
         Agreement, reduced by 4% for each year the employee is younger than age
         65 when such income begins. Such payments shall begin on a date to be
         determined by the Company, but within six months from the date of
         termination. However, any amount payable under this Section shall be
         reduced by any disability payments already paid under Section 4 of this
         Agreement. In the event that the Employee shall die after becoming
         entitled to receive said monthly installments but before any or all of
         said installments have been paid, the Company will pay or will continue
         to pay said installments to such beneficiary or beneficiaries as the
         Employee has directed by filing with the Company a notice in writing.
         In the event of the death of the last named beneficiary before all
         unpaid payments have been made, the balance of any amount which remains
         unpaid at said death shall be commuted on the basis of 9 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 Employee's death shall be commuted on the basis
         of 9 percent per annum compound interest and shall be paid in a single
         sum to the executor or administrator of the Employee's estate.

     6.  Forfeiture Provisions:
         ----------------------

         A.  During the period the retirement benefit is payable to the Employee
             under Section 2 or Section 5 of this Agreement, the Employee shall
             not engage in business activities in Stanly County North Carolina
             which are in competition with the Company without first obtaining
             the written consent of the Company.
<PAGE>
 
         B.  During the period the retirement benefit is payable to the Employee
             under Section 2 or Section 5 of the Agreement, the Employee shall
             be available to render consulting services to the Company upon
             request by an officer of the Company, but such requests shall not
             be made more frequently than once each month. The Employee 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 Company, if the Employee fails to comply with
             either of the conditions set forth in paragraph (A) and (B) of this
             Section 6.

     7.  General Provisions:
         ------------------ 

         A.  Except as otherwise provided by this Agreement, it is agreed that
             neither the Employee, 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 Company to the Employee 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 Company to
             discharge the Employee or restrict the right of the Employee to
             terminate his employment.

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

         D.  The Company hereby reserves the right to accelerate the payments
             specified in Sections 2, 3, 4 and 5 above without the consent of
             the Employee, his estate, beneficiaries, or any other person
             claiming through or under him.

         E.  The Company agrees that it will not merge or consolidate with any
             other Company or organization, or permit its business activities to
             be taken over by any other organization unless and until the
             succeeding or continuing Company or other organization shall
             expressly assume the rights and
<PAGE>
 
             obligations of the Company herein set forth. The Company further
             agrees that it will not cease its business activities or terminate
             its existence, other than as heretofore set forth in the 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 Company 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 Employee has hereunto
set his hand and seal, all on the day and year first above written.

ATTEST:                              HOME SAVINGS AND LOAN ASSOCIATION,
                                     ALBEMARLE, NC

/s/ Sheila S. Barbee                 By /s/ Carl M. Hill, President       (Seal)
----------------------------            ----------------------------------


WITNESS: /s/ Bobby Doby, Jr.          /s/ Carl M. Hill                    (Seal)
         -------------------         -------------------------------------
                                             (The Employee)
<PAGE>
 
                         BENEFICIARY DESIGNATION FORM

     As Beneficiary to receive any death benefits payable on my behalf from Home

Savings and Loan Association, Albemarle, NC, I designate the following :

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


PRIMARY:
------- 

         Peggy B. Hill     12/10/27  P.O. Box 489, Albemarle, N.C.        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 are
living at such time as the death benefit is payable, such benefit will be paid
to the Executor or the Administrator of your Estate.)

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

/s/ Bobby Doby, Jr.                          /s/ Carl M. Hill
-------------------------------              -----------------------------------
Witness                                      Signature of Employee


                                             October 1, 1985
                                             -----------------------------------
                                             Date



Note: The original should be retained by the Company and one copy by the
Employee.
<PAGE>
 
                                FIRST AMENDMENT

                                      TO

               CARL MELVIN HILL'S SUPPLEMENTAL INCOME AGREEMENT
               -------------------------------------------------

     This First Amendment to this "Agreement" entered into by Home Savings &
Loan Association, hereafter referred to as "Company" and Carl Melvin Hill,
hereafter referred to as "Employee", is made this 20th day of May , 1991.
                                                  -----                  

                                  WITNESSETH
                                  ----------

     WHEREAS, Home Savings & Loan Association (Company), in Albemarle, North
Carolina, entered into a non-qualified Supplemental Income Agreement (Agreement)
on October 1, 1985 with Carl Melvin Hill (Employee); and

     WHEREAS, the Board of Directors of the Company have by appropriate
resolution authorized the amendment of this Agreement to be effective April 1,
1991. The following sections of this Agreement are amended as follows:

     Section 2, Retirement Benefit. The first sentence of this Section 2 is
                ------------------                                         
deleted and the following is substituted:

          "Upon the later of (i) the Employee's 62nd birthday, or (ii) his
          actual retirement, the Company will commence to pay the Employee
          $1,200 per month for a continuous period of 216 months"

     Section 3, Death Benefit. The first sentence of this Section 3 is deleted
                --------------                                                
and the following is substituted:

          "Should the Employee die while in the employment of the Company and
          prior to the later of the attainment of the first day of the month
          following his 62nd birthday or the commencement of the retirement
          benefit payable in Section 2 above, the Company (beginning at a date
          to be determined by the Company but within six months from the date of
          such death) will commence to pay $1,200 per month for a continuous
          period of 216 months to such beneficiary or beneficiaries as the
          Employee has directed by filing with the Company a notice in writing."

     Section 4, Disability Benefit - Subsection A. The first sentence of Section
                -------------------                                             
4A is deleted and the following is substituted:

          "If the Employee shall become disabled (as defined in paragraph B of
          this Section 4) prior to the attainment of his 62nd birthday and prior
<PAGE>
 
          to his termination of employment, the Company shall commence to pay
          him $1,200 per month for a continuous period of 216 months."

     Section 5, Early Retirement Benefit. In the first sentence of this Section
                --------------------------                                     
5, the term "65th birthday" is replaced by the term "62nd birthday" in both
places in this first sentence.

     IN WITNESS WHEREOF, the Company has caused this Agreement to be amended and
signed in its Corporate name by its duly authorized officer and attested its
Secretary, and said Employee has hereunto set his hand and seal, on 20th day of
May , 1991.


(SEAL)                        HOME SAVINGS & LOAN ASSOCIATION
                              Albemarle, North Carolina


                              By: /s/ R. Ronald Swanner, Exec. Vice President
                                 ---------------------------------------------

ATTEST:


/s/ Sheila S. Barbee
---------------------------
SECRETARY

                              EMPLOYEE:


/s/ Bonnie P. Pinion          /s/ Carl M. Hill
-------------------------     ------------------------------------------------
Witness                       Carl M. Hill