Exhibit
10.1

     

    EMPLOYMENT
AGREEMENT

     

    THIS EMPLOYMENT AGREEMENT (the
“Agreement”), dated as of the 26th day of August, 2009 (the “Effective Date”),
is by and between American Patriot Bank, a Tennessee state-banking corporation
(the “Bank”), and John Donald Belew (the “Executive”).

     

    WHEREAS, the Bank is a wholly
owned subsidiary of American Patriot Financial Group, Inc., a Tennessee
corporation (the “Company”); and

     

    WHEREAS, the Bank desires to
employ the Executive and to enter into this Agreement embodying the terms and
conditions of such employment; and

     

    WHEREAS, the Executive desires
to accept such employment and enter into this Agreement setting forth the terms
and conditions of the employment relationship of the Executive with the
Company.

     

    NOW, THEREFORE, in
consideration of the mutual covenants and promises contained herein, and for
other good and valuable consideration, and intending to be legally bound hereby,
the parties agree as follows:

     

    1.           Employment.  The
Bank hereby employs the Executive and the Executive hereby accepts employment
with the Bank, upon the terms and subject to the conditions set forth
herein.

     

    2.           Term.  Subject
to termination as stated in Section 8, Executive shall be employed by the Bank
for a period commencing on the Effective Date, and shall have a term of three
hundred sixty five (365) days thereafter (the “Term”).  The Term shall
automatically be extended for additional one year periods (each, a “Renewal
Term”) each on the terms and conditions provided herein, unless either party
shall give the other party no less than ninety (90) days’ written notice prior
to the expiration of the Term or Renewal Term, as applicable.  On the
date on which the Company receives the approval of the Federal Reserve Bank of
Atlanta for the hiring of Executive as an executive officer of the Company or
the date after which the Federal Reserve Bank of Atlanta may no longer object to
the appointment of the Executive as an executive officer of the Company, the
Company shall execute an addendum to this Agreement and the Executive shall be
appointed as the Chief Executive Officer of the Company.

     

    3.           Position and
Duties.

     

    (a)           Chief Executive
Officer.  During the Term, the Executive shall serve as Chief
Executive Officer of the Bank performing duties commensurate with the position
and such additional duties as the Bank’s Board of Directors or a committee
thereof (collectively referred to as the “Board”) shall
determine.  Executive agrees to abide by all by-laws, policies,
practices, procedures or rules of the Company and the Bank.  The
Executive shall primarily perform his duties under this Agreement at the Bank’s
offices in Greeneville, Tennessee.

    


    
      
        
           


        

        
           


          
            

          

        

        
           


        

      

    

    


    (b)           Full-Time
Employment.  During the Term, the Executive shall devote
substantially all of Executive’s business time, and shall devote Executive’s
personal best efforts, to the performance of Executive’s duties hereunder in
accordance with the Company’s and the Bank’s by-laws, policies, practices,
procedures or rules in effect from time to time, and will not engage or serve in
any other business, profession or occupation for compensation or otherwise which
would, directly or indirectly, materially conflict or materially interfere with
the services rendered by Executive hereunder, without the prior written consent
of the Company and the Bank; provided, however, that it
shall not be a violation of this Agreement for the Executive with the approval
of the Company and the Bank to (a) devote reasonable periods of time to
charitable and community activities and industry or professional activities,
and/or (b) manage personal investments, so long as such activities do not
materially conflict or materially interfere with the performance of the
Executive’s responsibilities under this Agreement.

     

    4.           Base
Salary.  The Executive’s initial base salary as of the
Employment Date is $150,000, payable in substantially equal periodic payments in
accordance with the Bank’s regular payroll practices. The Executive shall be
entitled to such increases in the Executive’s base salary, if any, as may be
determined from time to time in the sole discretion of the Board. The Base
Salary rate at which the Executive is being compensated on the Date of
Termination (as defined below) shall be the Base Salary rate used in determining
all severance amounts, if any, payable to the Executive hereunder.

     

    5.           Bonus
Plan.  Executive shall be eligible to participate in such bonus
plans, if any, as shall be determined by the Board, and shall be paid in
accordance with the terms and conditions of any bonus plan established for the
Bank for which the Executive is eligible to participate (“Bonus Plan”);
provided, however, that in addition to such Bonus Plan the Executive shall have
the opportunity to earn those amounts set forth in Schedule A attached
hereto upon the achievement of those metrics specified in Schedule A attached
hereto.  Notwithstanding any provision to the contrary herein, in any
Bonus Plan, Company or Bank incentive or other compensation plan or any award
agreement, in addition to other remedies described in this Agreement, if at any
time the Executive breaches any provisions of this Agreement or otherwise
engages in activity or conduct that constitutes Cause (as defined below), the
Company and the Bank may each rescind any bonus payments, cash settlement of
awards granted under any Bonus Plan, Company or Bank incentive plan or other
incentive payments received by the Executive within one (1) year of the date of
Executive’s breach or the discovery by the Company or the Bank of
Cause.  In the event of any such rescission, Executive shall return to
the Company or the Bank, as applicable, the amount (before taxes) of any bonus
or incentive compensation. The payment shall be made in such manner and on such
terms and conditions as may be required by the Company or the Bank, as the case
may be. Each of the Company and the Bank shall be entitled to set off against
the amount of any such payment any amounts otherwise owed to the Executive by
the Company or the Bank.  In addition, upon demand by the Company or
the Bank, the Executive agrees to return to the Company or the Bank, as
applicable, all or a portion of any compensation, including, without limitation,
any bonus awards and incentive plan award payouts, paid to the Executive based
upon financial information or performance metrics later found to be materially
inaccurate. The amount to be recovered shall be equal to the excess of the
pre-tax amount paid out over the pre-tax amount that would have been paid out
had such financial information or performance metric been fairly stated at the
time the payout was made.

     

    
      
        
           


        

        
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    6.           Employee
Benefits.  During the Term, Executive shall be entitled to
participate in the Bank’s employee benefit plans as in effect from time to time
(collectively “Employee Benefits”), on the same basis and terms as those
benefits are generally made available to other employees of the Bank; provided,
that the Bank shall pay all monthly premium payments for the health insurance
component of the Employee Benefits for Executive and his spouse. Notwithstanding
anything to the contrary, during the Term, Executive shall be entitled to the
use of a Bank-owned automobile, cell phone and personal digital assistant, all
fully paid for and provided by the Bank.  Executive shall be entitled
to four weeks of paid vacation during the Term.  Nothing herein
contained shall be construed as requiring either the Company or the Bank to
establish or continue any particular benefit plan in the discharge of the Bank’s
obligations under this Agreement.

     

    7.           Expenses and
Perquisites.

     

    (a)           Expenses.  During
the Term, reasonable and necessary business expenses incurred by Executive in
the performance of Executive’s duties hereunder shall be reimbursed by the Bank
in accordance with Bank policies then in effect.

     

    (b)           Relocation
Expenses.  The Bank shall reimburse the Executive for his
reasonable and documented household moving expenses incurred in relocating to
Greeneville, Tennessee; provided, however, that the Bank’s obligations under
this Section 7(b) shall not collectively exceed $10,000.

     

    (c)           409A and
Reimbursements.  Notwithstanding anything herein to the
contrary, to the extent that any reimbursement of expenses, any fringe benefit
(including any benefit described in Section 6, if applicable) or other, similar
plan or arrangement in which the Executive participates during the term of the
Executive’s employment under this Agreement or thereafter provides for a
“deferral of compensation” within the meaning of Section 409A of the Internal
Revenue Code, as amended (the “IRC”) and Section 1.409A-1(d) of the related
Treasury Regulations, (i) the amount eligible for reimbursement or payment under
such plan or arrangement in one calendar year may not affect the amount eligible
for reimbursement or payment in any other calendar year (except that a plan
providing medical or health benefits may impose a generally applicable limit on
the amount that may be reimbursed or paid); (ii) subject to any shorter time
periods provided herein or the applicable plans or arrangements, any
reimbursement or payment of an expense under such plan or arrangement must be
made on or before the last day of the calendar year following the calendar year
in which the expense was incurred; and (iii) the right to reimbursement or
payment is not subject to liquidation or exchange for another
benefit.

     

    8.           Termination of
Agreement.  The Executive’s employment under this Agreement
shall not be terminated except as set forth in this Section 8 or upon the
expiration of the Term.  Any reference to the date of delivery of a
notice of termination or resignation by either the Bank or the Executive in this
Section shall constitute the “Date of Termination,” unless otherwise set forth
herein.

     

    


    
      
        
           


        

        
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    (a)           By Mutual
Consent.  The Executive’s employment pursuant to this Agreement
may be terminated at any time by the mutual written agreement of the Bank and
the Executive upon such terms as are agreed upon between the
parties.

     

    (b)           Death.  If
Executive dies during the Term or any Renewal Term of this Agreement, his
employment shall automatically terminate and the Bank shall pay his Base Salary
due through the date of his death.  The accrued Base Salary shall be
paid within thirty (30) days of the Executive’s death (with the payment date
determined by the Bank in its sole discretion). All outstanding stock options,
restricted stock, restricted stock units and any other unvested equity
incentives held by the Executive as of his Date of Termination shall vest and/or
remain exercisable for their stated terms solely in accordance with the terms of
the stock option agreements, restricted stock agreements or other award
agreements to which the Company and the Executive are parties at the time of his
death.  Neither the Bank nor the Company shall then have any further
obligations to the Executive or any representative of his estate or his
heirs.

     

    (c)           Disability.  The
Executive’s employment may be terminated by written notice by either party to
the other party, when the Executive suffers a physical or mental disability
entitling the Executive to long-term disability benefits under the Bank’s
long-term disability plan, if any, or in the absence of a Bank long-term
disability plan, the Executive is determined to be disabled in accordance with
Section 409A(a)(2)(C) of the IRC.

     

    If the
Executive’s employment is terminated under this Section 8(c), the Executive
shall be entitled to receive all Base Salary and benefits due to the Executive
through the Date of Termination. The accrued Base Salary shall be paid within
thirty (30) days of the Executive’s Date of Termination (with the payment date
determined by the Company or the Bank in its sole
discretion).  Furthermore, all outstanding stock options, restricted
stock, restricted stock units and any other unvested equity incentives held by
the Executive as of Date of Termination shall vest and/or remain exercisable for
their stated terms solely in accordance with the terms of the stock option
agreements, restricted stock agreements or other award agreements to which the
Company and the Executive are parties on the Date of Termination.

     

    (d)           By the Company for
Cause.  The Executive’s employment may be terminated
immediately by the Board by written notice to the Executive specifying the
event(s) relied upon for such termination upon the occurrence of any of the
following events (each of which shall constitute “Cause” for
termination):

     

    (i)           the
continued failure by the Executive to substantially perform his duties (other
than as a result of total or partial incapacity due to physical or mental
illness) after written notice and failure to cure within ten (10)
days;

     

    (ii)     
    engaging in misconduct which is materially injurious to
the Company or the Bank, monetarily or otherwise;

    


    
      
        
           


        

        
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    (iii)
        engaging in an act
constituting a felony, a misdemeanor involving the Company or any subsidiary or
affiliate of the Company, including the Bank, or a misdemeanor that results in
material and demonstrable harm to the business reputation of the Company or the
Bank;

     

    (iv)         engaging
in fraud, misappropriation, dishonesty, embezzlement or similar conduct by the
Executive;

     

    (v)          engaging
in conduct that brings the Company or the Bank or any subsidiary or affiliate of
the Company or the Bank into public disgrace or disrepute;

     

    (vi)         the
breach by the Executive of any of his obligations under this Agreement or any
other material agreement between the Company or the Bank, or any subsidiary or
affiliate thereof, and the Executive; or

     

    (vii)        willful
malfeasance, willful misconduct, or gross negligence in performing Company or
Bank policies or procedures after written notice and failure to cure within ten
(10) days.

     

    If the
Executive’s employment is terminated under this Section 8(d), the Executive
shall be entitled to receive all Base Salary and benefits to be paid or provided
to the Executive under this Agreement through the Date of
Termination.  The accrued Base Salary shall be paid within thirty (30)
days of the Executive’s Date of Termination (with the payment date determined by
the Company or the Bank in its sole discretion).  All outstanding
stock options, restricted stock, restricted stock units and any other vested
equity incentives held by the Executive as of the Date of Termination shall
remain exercisable solely in accordance with the terms of the stock option
agreements, restricted stock agreements or other award agreements to which the
Company and the Executive are parties on the Date of Termination.  All
unvested equity incentives shall terminate on the Date of Termination for Cause
and Executive shall have no further rights with respect thereto.

     

    (e)           By the Company Without
Cause.  The Executive’s employment may be terminated by the
Board at any time without Cause by delivery of a written notice of termination
to the Executive. If the Executive’s employment is terminated under this Section
8(e), the Executive shall be entitled to receive on the 60th day
following his Date of Termination unless the Company or the Bank is prohibited
from paying such amounts to the Executive under applicable state or federal
banking regulations:

     

    (i)           all
Base Salary and benefits due to the Executive through the Date of Termination;
and

     

    (ii)          subject
to continued compliance by the Executive with the previous of Section 12 of this
Agreement, an amount equal to the portion of Executive’s Base Salary that would
have been payable to the Executive for the ninety (90) day-period following the
Date of Termination payable in equal installments following such 60-day period
in accordance with the Company’s and the Bank’s normal payroll
process.

     

    
      
        
           


        

        
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    Furthermore,
all outstanding stock options, restricted stock, restricted stock units and any
other unvested equity incentives held by the Executive as of the Date of
Termination shall vest and/or remain exercisable for their stated terms solely
in accordance with the terms of the stock option agreements, restricted stock
agreements or other award agreements to which the Company and the Executive are
parties on the Date of Termination.

     

    Notwithstanding
the foregoing, if the Executive fails to execute, or timely revokes, a full and
complete release of claims (the “Release”) in favor of the Company, the Bank and
all affiliates, subsidiaries, agents, employees and directors of the Company and
the Bank and any affiliate or subsidiary of the Company or the Bank (the
“Released Parties”), then the Executive shall forfeit his right to receive any
payment under Section 8(e)(i) or (ii) above.

     

    (f)           By the Executive for Good
Reason.  The Executive’s employment may be terminated by the
Executive by written notice of his resignation delivered within sixty (60) days
after the occurrence of any of the following events, each of which shall
constitute “Good Reason” for resignation:

     

    (i)           a
material reduction in the Executive’s Base Salary (unless such reduction is part
of an across the board reduction affecting all employees of the Company or the
Bank); and

     

    (ii)          a
requirement by the Company or the Bank to relocate the Executive to a location
that is greater than fifty (50) miles from the location of the office in which
the Executive performs his duties hereunder at the time of such relocation
without the consent of the Executive.

     

    The
Executive shall give the Company and the Bank written notice of his intention to
resign for Good Reason (stating the reason therefor) within sixty (60) days
following the occurrence of one of the events described in Section 8(f)(i) or
(ii) above and the Company and the Bank shall have sixty (60) days thereafter to
cure the situation giving rise to such claim of Good Reason, in which event the
Executive no longer shall have the right to resign for Good Reason.

     

    If the
Executive resigns for Good Reason as defined in this Section 8(f), the Executive
shall be entitled to receive on the 60th day
following his Date of Termination unless the Company or the Bank is prohibited
from paying such amounts to the Executive under applicable state or federal
banking regulations:

     

    (i)           all
Base Salary and benefits due to the Executive under this Agreement through the
Date of Termination; and

    


    
      
        
           


        

        
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    (ii)          subject
to continued compliance by the Executive with the provisions of Section 12 of
this Agreement, an amount equal to the portion of Executive’s Base Salary that
would have been payable to the Executive for the ninety (90) day-period
following the Date of Termination payable in equal installments following such
60-day period in accordance with the Company’s and the Bank’s normal payroll
process.

     

    Furthermore,
all outstanding stock options, restricted stock, restricted stock units and any
other unvested equity incentives held by the Executive as of the Date of
Termination shall vest and/or remain exercisable for their stated terms solely
in accordance with the terms of the stock option agreements, restricted stock
agreements or other award agreements to which the Company and the Executive are
parties on the Date of Termination.

     

    Notwithstanding
the foregoing, if the Executive fails to execute, or timely revokes, a Release
in favor of the Released Parties, then the Executive shall forfeit his right to
receive any payment under Section 8(f)(i) or (ii) above.

     

    (g)           By the Executive Without
Good Reason.  The Executive may terminate his employment at any
time by delivery of a written notice of resignation to the Company and the Bank
no less than sixty (60) days and no more than ninety (90) days prior to the
effective date of the Executive’s resignation.  If the Executive
voluntarily terminates his employment with the Bank pursuant to this Section
8(g), the Executive shall be entitled to receive all Base Salary and benefits
due to the Executive through the Date of Termination.  The accrued
Base Salary shall be paid within thirty (30) days of the Executive’s Date of
Termination (with the payment date determined by the Company or the Bank in its
sole discretion).  All outstanding stock options, restricted stock,
restricted stock units and any other vested equity incentives held by the
Executive as of the Date of Termination without Good Reason shall remain
exercisable solely in accordance with the terms of the stock option agreements,
restricted stock agreements or other award agreements to which the Company and
the Executive are parties on the Date of Termination. All unvested equity
incentives shall terminate on the Date of Termination without Good Reason and
Executive shall have no further rights with respect thereto.

     

    (h)           Following a Change in
Control.  If, within twelve (12) months following a Change in
Control,  the Executive’s employment is terminated (i) by the
Executive or (ii) by the Company or the Bank without Cause (pursuant to Section
8(e)), the Executive shall be entitled to receive, or commence to receive, on
the 60th day
following his Date of Termination, unless the Company or the Bank is prohibited
from paying such amounts to the Executive under applicable state or federal
banking regulations:

     

    (i)           all
Base Salary and benefits due to the Executive through the Date of Termination;
and

     

    (ii)          subject
to continued compliance by the Executive with the provisions of Section 12 of
this Agreement, an amount equal to the Executive’s Base Salary for a total of
three hundred sixty-five (365) days following the Date of Termination payable
periodically in equal installments following such 60-day period in accordance
with the Company’s and the Bank’s normal payroll process.

    


    
      
        
           


        

        
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    Notwithstanding
the foregoing, if the Executive fails to execute, or timely revokes, a Release
in favor of the Released Parties, then the Executive shall forfeit his right to
receive any payment under Section 8(h)(i) or (ii) above.

     

    (i)           For
the purposes of this Agreement, a “Change in Control” shall mean any of the
following events:

     

    (A)           any
person or entity, including a “group” as defined in Section 13(d)(3) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), other than the
Company or a wholly-owned subsidiary thereof or any employee benefit plan of the
Company or any of its subsidiaries, becomes the beneficial owner of the
Company’s securities having 40% or more of the combined voting power of the then
outstanding securities of the Company that may be cast for the election of
directors of the Company (other than as a result of an issuance of securities
initiated by the Company in the ordinary course of business); or

    


    (B)           as
the result of, or in connection with, and upon the consummation of, any cash
tender or exchange offer, merger or other business combination, sales of assets
or contested election, or any combination of the foregoing transactions, less
than a majority of the combined voting power of the then outstanding securities
of the Company or any successor corporation or entity entitled to vote generally
in the election of the directors of the Company or such other corporation or
entity after such transaction are held in the aggregate by the holders of the
Company’s securities entitled to vote generally in the election of directors of
the Company immediately prior to such transaction; or

    


    (C)           during
any twelve-month period, individuals who at the beginning of any such period
constitute the Board cease for any reason to constitute at least a majority
thereof, unless the election, or the nomination for election by the Company’s
stockholders, of each director of the Company first elected during such period
was approved by a vote of at least two-thirds of the directors of the Company
then still in office who were directors of the Company at the beginning of any
such period.

     

    (j)           Excise Tax
Payment.  If, in connection with a Change in Control, the
Internal Revenue Service asserts, or if the Executive or the Company or the Bank
is advised in writing by an established accounting firm, that any payment in the
nature of compensation to, or for the benefit of, the Executive from the Bank
(or any successor in interest) constitutes an “excess parachute payment” under
Section 280G of the IRC, whether paid pursuant to this Agreement or any other
agreement, and including property transfers pursuant to securities and other
employee benefits that vest upon a Change in Control (collectively, the “Excess
Parachute Payments”) the Bank shall pay to the Executive, a cash sum equal to
the amount of excise tax due under section 4999 of the IRC on the entire
amount of the Excess Parachute Payments (excluding any payment pursuant to this
Section 8(j)). Any payment due under this Section 8(j) shall be paid as soon as
reasonably possible following demand of payment by the Executive, but in no
event later than December 31 of the year following the year (A) any tax is paid
to the Internal Revenue Service regarding this Section 8(j) or any tax audit or
litigation brought by the Internal Revenue Service or other relevant taxing
authority related to this Section 8(j) is completed or resolved.

    


    
      
        
           


        

        
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    9.           Delayed
Payments.  Notwithstanding anything herein to the contrary, to
the maximum extent permitted by applicable law, the payments to be made to the
Executive pursuant to Section 8 of the Agreement (the “Termination Payments”)
shall be made in reliance upon Treasury Regulations promulgated under Section
409A of the IRC, including Section 1.409A-1(b)(9) of the Treasury Regulations
(including any exceptions from the application of Section 409A thereunder) or
Section 1.409A-1(b)(4) of the Treasury Regulations.  For this purpose,
each Termination Payment shall be considered a separate and distinct payment for
purposes of Section 409A of the IRC.  However, to the extent any such
payments are treated as non-qualified deferred compensation subject to Section
409A of the IRC, then (a) no amount shall be payable pursuant to Section 8 above
unless Executive’s termination of employment constitutes a “separation from
service” within the meaning of Section 1.409A-1(h) of the Treasury Regulations
and (b) if Executive is deemed at the time of his separation from service to be
a “specified employee” for purposes of Section 409A(a)(2)(B)(i) of the IRC, then
to the extent delayed commencement of any portion of the Termination Payments to
which Executive is entitled under this Agreement is required in order to avoid a
prohibited distribution under Section 409A(a)(2)(B)(i) of the IRC, such portion
of Executive’s Termination Payments shall not be provided to Executive prior to
the earlier of (x) the expiration of the six-month period measured from the date
of the Executive’s “separation from service” with the Bank (as such term is
defined in Section 1.409A-1(h) of the Treasury Regulations) or (y) the date of
Executive’s death.  Upon the earlier of such dates, all payments
deferred pursuant to this Section 9 shall be paid in a lump sum to the
Executive, and any remaining payments due under the Agreement shall be paid as
otherwise provided herein.  The determination of whether the Executive
is a “specified employee” for purposes of Section 409A(a)(2)(B)(i) of the IRC as
of the time of his separation from service shall be made by the Company and the
Bank in accordance with the terms of Section 409A of the IRC and applicable
guidance thereunder (including without limitation Section 1.409A-1(i) of the
Treasury Regulations and any successor provision thereto).

     

    10.           Representations.  The
Executive represents and warrants that he is not a party to any agreement or
instrument which would prevent him from entering into or performing his duties
in any way under this Agreement.

     

    11.           Assignment; Binding
Agreement.  This Agreement is a personal contract and the
rights and interests of the Executive hereunder may not be sold, transferred,
assigned, pledged, encumbered, or hypothecated by him, except as otherwise
expressly permitted by the provisions of this Agreement.  This
Agreement shall inure to the benefit of and be enforceable by the Executive and
his personal or legal representatives, executors, administrators, successors,
heirs, distributees, devisees and legatees.  If the Executive should
die while any amount would still be payable to him hereunder had the Executive
continued to live, all such amounts, unless otherwise provided herein, shall be
paid in accordance with the terms of this Agreement to his devisee, legatee or
other designee or, if there is no such designee, to his estate.

     

    
      
        
           


        

        
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    12.           Confidentiality;
Non-Competition; Non-Solicitation.

     

    (a)           The
Executive acknowledges that: (i) the Company’s and the Bank’s business is
intensely competitive and that the Executive’s employment by the Bank will
require that the Executive have access to and knowledge of confidential
information of the Company and the Bank relating to, among other things, each
entity’s business plans, financial data, marketing programs, client information,
contracts and other trade secrets, in each case other than as and to the extent
such information is generally known or publicly available through no violation
of this Agreement by the Executive, (ii) the use or disclosure of such
information other than in furtherance of the Company’s and the Bank’s business
may place the Company and the Bank at a competitive disadvantage and may do
damage, monetary or otherwise, to the Company’s business; and (iii) the engaging
by the Executive in any of the activities prohibited by this Section 12 shall
constitute improper appropriation and/or use of such information.  The
Executive expressly acknowledges the trade secret status of the Company’s and
the Bank’s confidential information and that the confidential information
constitutes a protectable business interest of the Company or the Bank, as the
case may be.  Other than as may be required in the performance of his
duties, Executive expressly agrees not to divulge such confidential information
to anyone outside the Company or the Bank without the prior written consent of
the Company or the Bank, as the case may be.

     

    (b)           The
“Company” (which for purposes of the Section 12 shall be construed to include
the Company, its subsidiaries, including the Bank, and its and their respective
affiliates) and the Executive agree that for a period of one year after the Date
of Termination (the “Restricted Period”) if the Executive’s employment is
terminated under Sections 8(c)–(h), the Executive shall not:

     

    (i)           be
employed by or act as a consultant or advisor to, or be a director, officer,
employee, principal, agent, stockholder, member, owner or partner of, or permit
his name to be used in connection with the activities of any entity whose
business competes with the depository, lending or other business activities of
the Company in any city, town or county in which the Company has an office or
branch or has filed an application for regulatory approval to establish an
office or branch determined as of the Date of Termination, provided that, it shall not be
a violation of this sub-paragraph for the Executive to become the registered or
beneficial owner of less than five percent (5%) of any class of the capital
stock of any one or more competing corporations registered under
the  Securities Exchange Act of 1934, as amended, provided that, the Executive
does not participate in the business of such corporation until such time as this
covenant expires.

     

    (ii)          The
Executive further agrees that for the Restricted Period he will not, directly or
indirectly, for his benefit or for the benefit of any other person or entity, do
any of the following:

     

    (A)           solicit
from any customer, doing business with the Company as of the Executive’s Date of
Termination, business of the same or of a similar nature to the business of the
Company with such customer; or

    


    
      
        
           


        

        
          10

          
            

          

        

        
           


        

      

    

     

    (B)           recruit
or solicit the employment or services of any person who was employed by the
Company as of the Executive’s Date of Termination and is employed by the Company
at the time of such recruitment or solicitation.

     

    (c)           The
Executive acknowledges that the services to be rendered by him to the Company
are of a special and unique character, which causes this Agreement to be of
significant value to the Company, the loss of which may not be reasonably or
adequately compensated for by damages in an action at law, and that a breach or
threatened breach by him of any of the provisions contained in this Section will
cause the Company irreparable injury.  The Executive therefore agrees
that the Company will be entitled, in addition to any other right or remedy, to
a temporary, preliminary and permanent injunction, without the necessity of
proving the inadequacy of monetary damages or the posting of any bond or
security, enjoining or restraining the Executive from any such violation or
threatened violations. The Executive acknowledges that the terms of this
Section 12 and its obligations are reasonable and Executive’s experience
and capabilities are such that Executive can obtain employment in a business
engaged in other lines and/or of a different nature than the Company, and that
the enforcement of a remedy by ways of injunction will not prevent Executive
from earning a livelihood.

     

    (d)           If
any one or more of the provisions contained in this Agreement shall be held to
be excessively broad as to duration, activity or subject, such provisions shall
be construed by limiting and reducing them so as to be enforceable to the
fullest extent permitted by law.

     

    13.           Entire
Agreement.  This Agreement contains all the understandings
between the parties pertaining to the matters referred to herein, and supersedes
any other undertakings and agreements, whether oral or written, previously
entered into by them with respect thereto.  The Executive represents
that, in executing this Agreement, he does not rely and has not relied upon any
representation or statement not set forth herein made by the Bank with regard to
the subject matter or effect of this Agreement or otherwise and that Executive
has had the opportunity to be represented by counsel of his
choosing.

     

    14.           Amendment or Modification;
Waiver.  No provision of this Agreement may be amended or
waived, unless such amendment or waiver is agreed to in writing, signed by the
Executive and by a duly authorized officer of the Bank.  No waiver by
any party hereto of any breach by another party hereto of any condition or
provision of this Agreement to be performed by such other party shall be deemed
a waiver of a similar or dissimilar condition or provision at the same time, any
prior time or any subsequent time.

     

    15.           Notices.  Any
notice to be given hereunder shall be in writing and shall be deemed given when
delivered personally, sent by courier, facsimile or registered or certified
mail, postage prepaid, return receipt requested, addressed to the party
concerned at the address indicated below or to such other address as such party
may subsequently give notice in writing:

    


    
      
        
           


        

        
          11

          
            

          

        

        
           


        

      

    

     

    
      
        	
                If
      to the Company and the Bank to:

              	 
      	
                with
      a copy to (which shall not constitute notice):

              
	 
      	 
      	 
      
	
                American
      Patriot Financial Group, Inc.

                American
      Patriot Bank

                3095
      East Andrew Johnson Highway

                Greeneville,
      Tennessee 37745

                Attn:
      Chairman

                Telephone:  (423)
      636-1555

                Facsimile:  (423)
      636-1563

              	 
      	
                D.
      Scott Holley

                Bass,
      Berry & Sims PLC

                315
      Deaderick Street, Suite 2700

                Nashville,
      Tennessee 37238-3001

                Telephone:  (615)
      742-7721

                Facsimile:  (615)
      742-2813

              
	 
      	 
      	 
      
	
                If
      to Executive to:

              	 
      	
                with
      a copy to (which shall not constitute notice):

              
	 
      	 
      	 
      
	
                ______________________

                ______________________

                ______________________

                Telephone:  (___)
      ___-____

                Facsimile:  (___)
      ___-____

              	 
      	
                ______________________

                ______________________

                ______________________

                Telephone:  (___)
      ___-____

                Facsimile:  (___)
      ___-____

              
	 
      	 
      	 
      


      

    

    Any notice delivered personally or by
courier shall be deemed given on the date delivered. Any notice sent by
facsimile, registered or certified mail, postage prepaid, return receipt
requested, shall be deemed given on the date transmitted by facsimile or
mailed.

    


    16.           Severability.  If
any provision of this Agreement or the application of any such provision to any
party or circumstances shall be determined by any court of competent
jurisdiction to be invalid and unenforceable to any extent, the remainder of
this Agreement or the application of such provision to such person or
circumstances other than those to which it is so determined to be invalid and
unenforceable, shall not be affected thereby, and each provision hereof shall be
validated and shall be enforced to the fullest extent permitted by
law.

     

    17.           Survivorship.  The
respective rights and obligations of the parties hereunder shall survive any
termination of this Agreement to the extent necessary to the intended
preservation of such rights and obligations.

     

    18.           Governing Law;
Venue.  This Agreement will be governed by and construed in
accordance with the laws of the State of Tennessee, without regard to the
principles of conflicts of law thereof.

     

    19.           Headings.  All
descriptive headings of sections and paragraphs in this Agreement are intended
solely for convenience, and no provision of this Agreement is to be construed by
reference to the heading of any section or paragraph.

     

    20.           Counterparts.  This
Agreement may be executed in counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.

    


    
      
        
           


        

        
          12

          
            

          

        

        
           


        

      

    

     

    21.           Compliance with Section
409A.  The parties acknowledge and agree that, to the extent
applicable, this Agreement shall be interpreted in accordance with, and the
parties agree to use their best efforts to achieve timely compliance with,
Section 409A of the IRC and the Treasury Regulations and other interpretive
guidance issued thereunder, including without limitation any such regulations or
other guidance that may be issued after the Effective Date. Notwithstanding any
provision of this Agreement to the contrary, in the event that the Company or
the Bank determines that any compensation or benefits payable or provided under
this Agreement may be subject to Section 409A of the IRC, the Company and the
Bank may adopt such limited amendments to this Agreement and appropriate
policies and procedures, including amendments and policies with retroactive
effect, that each of  the Company and the Bank reasonably determines
are necessary or appropriate to (i) exempt the compensation and benefits payable
under this Agreement from Section 409A of the IRC and/or preserve the intended
tax treatment of the compensation and benefits provided with respect to this
Agreement or (ii) comply with the requirements of Section 409A of the
IRC.

    


    
      
        
           


        

        
          13

          
            

          

        

        
           


        

      

    

    


    IN WITNESS WHEREOF, the
parties hereto have executed this Employment Agreement effective as of date set
forth above.

    


    
      
        	 
      	
                AMERICAN
      PATRIOT BANK

              
	 	 
	 
      	
                By:

              	
                /s/ William J. Smead

              	 
      
	 
      	
                Name:

              	
                William J. Smead

              	 
      
	 
      	
                Title:

              	
                Chairman

              	 
      
	 
      	 
      	 
      	 
      
	 
      	
                EXECUTIVE

              
	 
      	 
      	 
      	 
      
	 
      	
                /s/ John Donald Belew

              	 
      
	 
      	
                John
      Donald Belew

              	 
      


      

    

    


    
      
        
           


        

        
          14

          
            

          

        

        
           


        

      

    

    


    SCHEDULE  A

    


    MINIMUM
EXECUTIVE BONUS

    


    Capitalized terms used in this Schedule
A without definition shall have the meaning ascribed to such term in the
Employment Agreement dated as of August 26, 2009, by and between American
Patriot Bank and John Donald Belew.

     

    1.           The
Executive shall be entitled to receive a cash incentive payment equal to 5% of
the Executive’s then current Base Salary in the event that the Bank’s composite
CAMELS rating for any given examination report is a 2 or better, or such rating
is at least one level better than the Bank’s composite CAMELS rating reflected
in the Bank’s immediately preceding examination report.  The cash
incentive payment, if earned, shall be made on the date that the final
examination report is delivered to the Bank by the regulatory agency responsible
for the examination giving rise to the relevant examination report.

     

    2.           The
Executive shall be entitled to receive a cash inventive payment equal to 5% of
the Executive’s then current Base Salary if, based on the Company’s audited
financial statements for any fiscal year ending on or after December 31, 2009,
the quotient, rounded to the nearest 100th of a
percent, resulting from (x) the Company’s non-interest expense for such fiscal
year as set forth on the Company’s audited consolidated income statement divided
by (y) the sum of (I) the Company’s net interest income for such fiscal year and
(II) the Company’s non-interest income for such fiscal year, each as set forth
on the Company’s audited financial statements (such quotient the “Efficiency
Ratio”), exceeds by 5% the Efficiency Ratio for the Company’s immediately
preceding fiscal year based on the audited financial statements for such
immediately preceding fiscal year.  The cash incentive payment, if
earned, shall be paid on the date that the Company’s independent registered
public accounting firm issues an unqualified opinion with respect to the
Company’s audited financial statements for the most recently completed fiscal
year.

     

    3.           The
Executive shall be entitled to receive a cash incentive payment equal to 5% of
the Executive’s then current Base Salary if, based on the Company’s audited
financial statements for any fiscal year ending on or after December 31, 2009,
the quotient, rounded to the nearest 100th of a
percent, resulting from (x) the Company’s net income for such fiscal year as set
forth on the Company’s audited consolidated income statement divided by (y) the
Company’s total assets as of the end of such fiscal year as set forth on the
Company’s audited consolidated balance sheet (“ROA”) is (A) equal to, or higher
than, 0.25%; and (B) exceeds by
0.10% the Company’s ROA for the immediately preceding fiscal year based on the
audited financial statements for such immediately preceding fiscal year. The
cash incentive payment, if earned, shall be paid on the date that the Company’s
independent registered public accounting firm issues an unqualified opinion with
respect to the Company’s audited financial statements for the most recently
completed fiscal year.