Exhibit 10.6


 


AMENDED AND RESTATED EMPLOYMENT AGREEMENT


 


THIS AMENDED AND RESTATED EMPLOYMENT  AGREEMENT
(this “Agreement”) is entered into as of December 31, 2008, by and between
Yadkin Valley Financial Corporation, a North Carolina corporation (the “Company”),
Yadkin Valley Bank and Trust (the “Bank”), a North Carolina state bank and
wholly owned subsidiary of the Company (the Company and the Bank collectively
referred to herein as the “Employer”) and Edwin E. Laws of Statesville, North
Carolina (the “Officer”).  This Agreement
amends and restates that certain employment agreement dated February 1,
1999.


 


For and in consideration of their mutual promises, covenants and
conditions hereinafter set forth, and other good and valuable consideration,
the receipt and sufficiency of which hereby is acknowledged, the parties agree
as follows:


 


1.                                      Emp1oyment.  The Employer agrees to continue to employ
the Officer and the Officer agrees to continue to accept employment upon the
terms and conditions stated herein as the Chief Financial Officer and Treasurer
of the Company and the Bank.  The Officer
shall render such administrative and management services to the Employer as are
customarily performed by persons situated in a similar executive capacity.  The Officer shall promote the business of the
Employer, including being active in at least one civic organization in Iredell
County, and perform such other duties as shall, from time to time, be
reasonably assigned by the Board of Directors of the Company or the Bank (collectively,
the “Directors”).  Upon the request of
the Directors, the Officer shall disclose all business activities or commercial
pursuits in which Officer is engaged, other than Employer duties.


 


2.                                      Compensation.  The Employer shall pay the Officer during
the term of this Agreement, as compensation for all services rendered by the
Officer to the Employer, a base salary at the rate of $144,213 per annum,
payable in cash in accordance with the Employer’s standard payroll practices,
which for purposes of this Agreement shall mean not less frequently than
monthly.  Participation in the Employer’s
incentive compensation, deferred compensation, discretionary bonus,
profit-sharing, retirement and other employee benefit plans and participation
in any fringe benefits shall not reduce the salary payable to the Officer under
this Paragraph.  In the event of a Change
in Control (as defined in Paragraph 10), the Officer’s rate of salary shall be
increased not less than five percent annually during the term of this Agreement.  Any payments made under this Agreement shall
be subject to such deductions as are required by law or regulation or as may be
agreed to by the Bank and the Officer.


 


3.                                      Discretionary
Bonuses.  During the term of this
Agreement, the Officer shall be entitled, in an equitable manner with all other
key management personnel of the Employer, to such discretionary bonuses as may
be authorized, declared and paid by the Directors to the Employer’s key
management employees. All such bonuses authorized and declared by the Directors
shall be paid in cash at the latest within sixty days of the earlier of such
authorization or declaration. 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.


 


4.                                      Participation
in Retirement and Employee Benefit Plans; Fringe Benefits.


 


(a)                                  The Employer shall
provide family medical coverage for the Officer and the Officer shall also be
entitled to participate in any plan relating to deferred compensation, stock
options, stock purchases, pension, thrift, profit sharing, group life
insurance, disability coverage, education, or other retirement or employee
benefits that the Employer has adopted,
or may, from time to time adopt,
for the benefit of its executive employees or for employees generally, subject
to the eligibility rules of
such plans.  Any options or similar
awards shall be issued to the Officer at an exercise price of not less than the
stock’s current fair market value (as determined in compliance with Treasury
Regulation § 1.409A-1(b)(5)(iv)) as of the date of grant, and the number of
shares subject to such grant shall be fixed on the date of grant.


 


(b)                                 The Employer shall pay the expenses of the Officer
for membership and dues in one country
club and in one civic club in Statesville.


 


(c)                                  The Officer shall also be entitled to
participate in any other fringe benefits which are now or may be or become applicable to the Employer’s executive
employees, including the payment of
reasonable expenses for continuing education to maintain professional
designations, and any other benefits which are commensurate with the duties and
responsibilities to be performed by the Officer under this Agreement.  Additionally, the Officer shall be entitled
to such vacation and sick leave as shall
be established under uniform employee policies promulgated by the
Directors.  The Employer shall reimburse
the Officer for all out-of-pocket reasonable and necessary business expenses which the Officer may incur in connection
with the Officer’s services on behalf of the Employer. The Employer
shall reimburse the Officer for such expenses described in this Paragraph 4
within 60 days of Officer’s incurring such expense.


 


5.                                      Term.  The
initial term of employment under this Agreement shall be for the period commencing upon the effective date of
this Agreement and ending one
calendar years from the 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 Employer or the
Officer is received 90 days prior to an anniversary date advising the other 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 days’ notice.


 


6.                                      Loyalty; Noncompetition.


 


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


 

















 


(b)                                 During the term of this Agreement, or any
renewals thereof, and for a period of [two]
years after termination, the Officer
agrees he will not, within Iredell County, North Carolina, or within 15 miles
of any Bank office opened during
the term of this Agreement,
directly or indirectly, own, manage, operate, join, control or participate in
the management, operation or control of, or be employed by or connected in any
manner with any business which competes with the Employer or any of its
subsidiaries without the prior written consent of the Employer; provided,
however, that the provisions of this Paragraph shall not apply in the event the Officer’s employment is
unilaterally terminated by the Employer for Cause, (as such term is defined in
Paragraph 8(c) hereof) or in the event the Officer terminates his
employment with the Employer for “good reason” (as such term is defined in Paragraph 10(b) hereof) following a “Change
in Control” (as such term is defined in Paragraph 10(d) hereof).  Notwithstanding the foregoing, the Officer
shall be free, without such consent, to purchase or hold as an
investment or otherwise, up to five percent of the outstanding stock or other
security of any corporation which has its securities publicly traded on any
recognized securities exchange or in any over the counter market.


 


(c)                                  The Officer agrees he will hold in confidence
all knowledge or information of a confidential nature with respect to the
business of the Employer or any subsidiary received by the Officer during the
term of this Agreement and will not disclose or make use of such information
without the prior written consent of the Employer.  The Officer agrees that he will be liable to
the Employer for any damages
caused by unauthorized disclosure of such information.  Upon termination of his employment, the Officer agrees to, return all
records or copies thereof of the Employer or any subsidiary in his possession or under his control which relate
to the activities of the Employer or any subsidiary.


 


(d)                                 The Officer acknowledges that it would not be
possible to ascertain the amount of monetary damages in the event of a breach by the Officer under the
provisions of this Paragraph
6.  The Officer agrees that, in the event
of a breach of this Paragraph 6,
injunctive relief enforcing the terms of this Paragraph 6 is an appropriate remedy. 
If the scope of any restriction
contained in this Paragraph 6 is determined to be too broad by any court of
competent jurisdiction, then such restriction shall be enforced to the maximum
extent permitted by law and the Officer consents that the scope of this
restriction may be modified judicially.


 


7.                                      Standards.  The
Officer shall perform his duties and responsibilities 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 Directors. 
The Employer will provide the Officer with the working facilities and
staff customary for similar executives and necessary for the Officer to perform his duties.


 


8.                                      Termination and Termination Pay.  For
purposes of this Agreement, the term “terminate” or “termination” shall mean a “separation
from service” as defined by Treasury Regulation § 1.409A-1(h).


 

















 


(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 to receive
the compensation due the Officer through the last day of the calendar month in
which the Officer’s death shall have occurred and for a period of one month
thereafter. All such payments due under this Paragraph 8(a) shall be paid
to the estate within 30 days of the date of death of the Officer.


 


(b)                                 The Officer’s
employment under this Agreement may be terminated at any time by the Officer
upon 60 days’ written notice to the Directors. 
Upon such termination, the Officer shall be entitled to receive compensation through the effective
date of such termination. All such payments due under this Paragraph 8(b) shall be paid to the Officer within 30 days
of the date of written notice to the Directors.


 


(c)                                  The Directors may
terminate the Officer’s employment at
any time, but any termination by the Directors, other than termination for Cause, shall not prejudice
the Officer’s right to compensation or other benefits under this Agreement.  The Employer shall provide written notice
specifying the grounds for termination for Cause.  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 or moral turpitude, incompetence,
willful misconduct, breach of fiduciary duty involving personal profit,
intentional failure to perform stated duties, willful violation of any law,
rule, or regulation (other than traffic violations or similar offenses) or
final cease-and-desist order, or material breach of any provision of this Agreement.  Subject to Paragraph 11(b) below, any
amount of compensation or other benefit that the Officer has a right to as of
the date of termination shall be paid within 30 days of such termination. Notwithstanding
such termination, the obligations under Paragraph 6(c) shall survive any
termination of employment.


 


(d)                                 Subject to the
Employer’s obligations and the Officer’s rights under (i) Title I of the
Americans with Disabilities Act, §504 of the Rehabilitation Act, and the
Family and Medical Leave Act, and to (ii) the vacation leave, disability
leave, sick leave and any other leave policies of the Employer, the Officer’s
employment under this Agreement automatically shall be terminated in the event
that the Employer determines that the Officer has become disabled (as defined
by Treasury Regulation § 1.409A-3(i)(4)) during the term of this Agreement.  Upon any such termination, the Officer shall
be entitled to receive any compensation the Officer shall have earned prior to
the date of termination but which remains unpaid, and all such amounts shall be
paid to the Officer within 30 days of such termination.  The Officer shall also be entitled to receive
any payments provided under any disability income plan of the Employer which is
applicable to the Officer.


 


In the event of any disagreement between the Officer and the Employer
as to whether the Officer is physically or mentally disabled such as will
result in the termination of the Officer’s employment pursuant to this
Paragraph 8(d), the question of such disability shall be submitted to an
impartial physical licensed to practice medicine in North Carolina for
determination and who will be selected by mutual agreement of the Officer and
the Employer, 


 

















 


or failing such agreement, by two (2) physicians (one (1) of
whom shall be selected by the Employer and the other by the Officer), and such
determination of the question of such disability by such physician or
physicians shall be final and binding on the Officer and the Employer.  The Employer shall pay the reasonable fees
and expenses of such physician or physicians in making any determination
required under this Paragraph 8(d).


 


9.                                      Additional Regulatory
Requirements.  Notwithstanding
anything contained in this
Agreement to the contrary, it is
understood and agreed that the Employer (or any of its successors in interest) shall not be required to
make any payment or take any action under this Agreement if:


 


(a)                                  the Bank is declared
by any governmental agency having jurisdiction over the Bank (hereinafter
referred to as “Regulatory Authority”) to be insolvent, in default or operating
in an unsafe or unsound manner; or,


 


(b)                                 in the opinion of counsel to the Employer,
such payment or action (i) would
be prohibited by or would violate any provision of state or federal law
applicable to the Employer, including, without limitation, the Federal
Deposit Insurance Act as now in effect
or hereafter amended, (ii) would be prohibited by or would violate
any applicable rules, regulations, orders or
statements of policy, whether now existing or hereafter promulgated, of any
Regulatory Authority, or (iii) otherwise would be prohibited by any Regulatory
Authority.


 


10.                               Change in Control.


 


(a)                                  In the event of a termination of the Officer’s
employment in connection with, or within twenty-four (24) months after, a “Change
in Control” (as defined in Subparagraph (d) below) of the Employer other
than for Cause (as defined in Paragraph 8), the Officer shall be
entitled to receive liquidated damages as set forth in Subparagraph (c) below. 
Such sum shall be payable as provided in Subparagraph (e) below.


 


(b)                                 In
addition to any rights the Officer might have to terminate this Agreement
contained in Paragraph 8, the Officer shall have the right to terminate this
Agreement for “good reason”, as such term is defined by Treasury Regulation §
1.409A-1(n)(2), within twenty-four months following a Change in Control of the
Bank.


 


(c)                                  In the event that the Officer terminates this
Agreement pursuant to this Paragraph 10, the Employer will be obligated to pay
or cause to be paid to Officer liquidated damages in an amount equal to 2.99
times the Officer’s “base amount” as defined in Section 280G(b)(3) of
the Internal Revenue Code of 1986, as amended (the “Code”).


 


(d)                                 For
the purposes of this Agreement, the term Change in Control shall mean as
defined by Treasury Regulation § 1.409A-3(i)(5). Notwithstanding the other
provisions of this Paragraph 10, 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 


 

















 


Bank agree in writing that the same shall not be treated as a Change in
Control for purposes of this Agreement.


 


(e)                                  Subject
to Paragraph 11(b) below, such amounts payable pursuant to this Paragraph
10 shall be paid in one lump sum payment within fifteen (15) days following
termination of this Agreement.


 


(f)                                    Following
an event constituting good reason for termination which gives rise to Officer’s
rights hereunder, the Officer shall have twelve (12) months from the date of
occurrence of such event to terminate this Agreement pursuant to this Paragraph
10.  Any such termination shall be deemed
to have occurred only upon delivery to the Employer (or to any successor
corporation) of written notice of termination which describes the Change in
Control and the event constituting good reason. 
If Officer does not so terminate this Agreement within such twelve-month
period, he shall thereafter have no further rights hereunder with respect to
the event constituting good reason, but shall retain rights, if any, hereunder
with respect to any other event constituting good reason as to which such
period has not expired.


 


(g)                                 It is the intent of the parties hereto that
all payments made pursuant to this Agreement be deductible by the Employer for federal income tax
purposes and not result in the
imposition of an excise tax on the Officer. 
Notwithstanding anything contained in this Agreement to the contrary,
any payments to be made to or for the benefit of the Officer which are deemed
to be “parachute payments” as that term is defined in Section 280G
of the Code, shall be modified or
reduced to the extent deemed to be necessary by the Directors to avoid the
imposition of excise taxes on the Officer under Section 4999 of the Code
or the disallowance of a deduction to the Employer under Section 280(a) of
the Code.


 


(h)                                 In the event any dispute shall arise between
the Officer and the Employer as to the terms or interpretation of this
Agreement, including this Paragraph
10, whether instituted by formal
legal proceedings or otherwise, including any action taken by the
Officer to enforce the terms of this Paragraph 10 or in defending against any
action taken by the Employer,
the Employer shall reimburse the
Officer for all costs and expenses, proceedings or actions, in the event the Officer
prevails in any such action.


 


11.                               Conditions
to any Payment of Severance Amounts.


 


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


 


(b)                                 If: (1) when the
Officer’s employment terminates under this Agreement he is a specified
employee, as defined in Section 409A of the Code or the regulations
promulgated thereunder; (2) the Officer’s employment did not terminate
because of his death; (3) any payments under this Agreement will result in
additional tax or interest to the Officer because of Section 409A or the
regulations promulgated thereunder; and (4) an exemption 


 

















 


from the six-month delay requirement of Section 409A(a)(2)(B)(i) is
not available, then despite any provision of this Agreement to the contrary the
Officer will not be entitled to such payments until the earlier of: (1) six
months and one day after termination of the Officer’s employment; or (2) his
death.  Payments that would have
otherwise been paid during such six month and one day period shall be
accumulated and paid on the earlier of: (1) the first day of the seventh
month after such termination of employment; or (2) death of the Officer;
and the remaining amount of any such payment due under this Agreement shall be
paid as set forth elsewhere in this Agreement without regard to this Paragraph.


 


12.                               Successors and Assigns.


 


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


 


(b)                                 Since the Employer 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 Employer.


 


13.                               Modification;
Wavier; 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 Employer 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 amendment or
addition to this 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 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 severable and the invalidity or
unenforceability of any provision shall not affect the validity or
enforceability of the other provisions hereof.


 


16.                               Entire
Agreement.  This Agreement
constitutes the entire agreement of the parties pertaining to the employment of
the Officer and supersedes all prior and contemporaneous agreements,
representations, and understandings of the parties.  Officer agrees that no promises, representations, or inducements have been
made which caused Officer to sign this Agreement other than those which
are expressly set forth above.


 

















 


17.                               Compliance
with Internal Revenue Code Section 409A.  The Employer and the Officer intend that
their exercise of authority or discretion under this Agreement shall comply
with section 409A of the Internal Revenue Code of 1986.  If any provision of this Agreement does not
satisfy the requirements of section 409A, such provision shall nevertheless be
applied in a manner consistent with those requirements. If any provision of
this Agreement would subject the Officer to additional tax or interest under
section 409A, the Employer shall reform the provision.  However, the Employer shall maintain to the
maximum extent practicable the original intent of the applicable provision
without subjecting the Officer to additional tax or interest, and the Officer
shall not be required to incur any additional compensation expense as a result
of the reformed provision.  References in
this Agreement to section 409A of the Internal Revenue Code of 1986 include rules,
regulations, and guidance of general application issued by the Department of
the Treasury under Internal Revenue Code section 409A.


 


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


 


	
   

  	
   

  	
  YADKIN VALLEY FINANCIAL CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ATTEST:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Patricia Wooten

  	
   

  	
  By:

  	
  /s/William A. Long

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
  Patricia Wooten

  	
   

  	
  Name:

  	
  William A. Long

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  President and Chief Executive Officer

  
	
   

  
	
   

  
	
   

  	
   

  	
  YADKIN VALLEY BANK AND TRUST

  
	
   

  	
   

  	
   

  
	
  ATTEST:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Patricia Wooten

  	
   

  	
  By:

  	
  /s/ William A. Long

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
  Patricia Wooten

  	
   

  	
  Name:

  	
  William A. Long

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  President and Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  OFFICER

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Edwin E. Laws

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Edwin E. Laws