Severance Protection Agreement (edwin W. Hortman, JR.)

Exhibit 10.14

SEVERANCE PROTECTION AND NON-COMPETITION AGREEMENT

THIS SEVERANCE PROTECTION AND NON-COMPETITION AGREEMENT (the " Agreement" ) made as of April 13, 1998, by and between ABC BANCORP (the " Company" ), a Georgia corporation, and EDWIN W. HORTMAN, JR. (the " Executive" ), an individual resident of the State of Georgia.

WHEREAS , the Board of Directors of the Company (the " Board" ) has determined that it is essential and in the best interest of the Company and its shareholders to retain the services of the Executive in the event of a threat or occurrence of a Change in Control (as hereinafter defined) and to ensure his continued dedication and efforts in such event without undue concern for his personal financial and employment security;

WHEREAS , in order to induce the Executive to remain in the employ of the Company in the event of a threat or the occurrence of a Change in Control, the Company desires to enter into this Agreement with the Executive to provide the Executive with certain benefits in the event his employment is terminated as a result of, or in connection with, a Change in Control and to provide the Executive with certain other benefits whether or not the Executive' s employment is terminated; and

WHEREAS , in consideration for the benefits provided to the Executive hereunder and as an inducement to the Company providing such benefits, the Executive agrees that it is reasonable and fair to enter into certain restrictive covenants as hereinafter set forth.

NOW, THEREFORE , in consideration of the respective agreements of the parties contained herein, it is agreed as follows:

1. Term of Agreement . This Agreement shall commence as of April 13, 1998 and shall continue in effect until April 13, 1999; provided , however , that commencing on April 13, 1999, and on each April 13 thereafter, the term of this Agreement shall automatically be extended for one (1) year unless either the Company or the Executive shall have given written notice to the other at least ninety (90) days prior thereto that the term of this Agreement shall not be so extended; and provided , further , however , that notwithstanding any such notice by the Company not to extend, the term of this Agreement shall not expire prior to the expiration of twelve (12) months after the occurrence of a Change in Control.


2. Definitions .

2.1. Accrued Compensation . For purposes of this Agreement, " Accrued Compensation" shall mean an amount which shall include all amounts earned or accrued through the " Termination Date" (as hereinafter defined) but not paid as of the Termination Date, including, without limitation, (i) base salary, (ii) reimbursement for reasonable and necessary expenses incurred by the Executive on behalf of the Company during the period ending on the Termination Date, (iii) vacation pay, and (iv) bonuses and incentive compensation (other than the " Pro Rata Bonus" (as hereinafter defined)).

2.2. Base Amount . For purposes of this Agreement, " Base Amount" shall mean the greater of the Executive' s annual base salary (a) at the rate in effect on the Termination Date or (b) at the highest rate in effect at any time during the ninety (90) day period prior to the Change in Control, and shall include all amounts of his base salary that are deferred under the qualified and non-qualified employee benefit plans of the Company or any other agreement or arrangement.

2.3. Bonus Amount . For purposes of this Agreement, " Bonus Amount" shall mean the average of the annual bonuses paid or payable to the Executive during the three (3) full fiscal years ended prior to the Termination Date or, if greater, the three full fiscal years ended prior to the Change in Control (or, in each case, such lesser period for which annual bonuses were paid or payable to the Executive).

2.4. Cause . For purposes of this Agreement, a termination of employment is for " Cause" if the Executive has been convicted of a felony or a felony prosecution has been brought against the Executive or if the termination is evidenced by a resolution adopted in good faith by two-thirds of the Board that the Executive (a) intentionally and continually failed substantially to perform his reasonably assigned duties with the Company (other than a failure resulting from the Executive' s incapacity due to physical or mental illness or from the Executive' s assignment of duties that would constitute " Good Reason" as hereinafter defined) which failure continued for a period of at least thirty (30) days after a written notice of demand for substantial performance has been delivered to the Executive specifying the manner in which the Executive has failed substantially to perform, or (b) intentionally engaged in conduct which is demonstrably and materially injurious to the Company; provided , however , that (i) where the Executive has been terminated for Cause because a felony prosecution has been brought against him and no conviction or plea of guilty or plea of nolo contendere or its equivalent results therefrom, then said termination shall no longer be deemed to have been for Cause and the Executive shall be entitled to all the benefits provided by Section 3.1(b) hereof from and after the date on which the prosecution of the Executive has been dismissed or a judgement of acquittal has been entered, whichever shall first occur; and (ii) no termination of the Executive' s employment shall be for Cause as set forth in clause (b) above until (x) there shall have been delivered to the Executive a copy of a written notice setting forth that the Executive was guilty of the conduct set forth in clause (b) and specifying the particulars thereof in detail, and (y) the Executive shall have been provided an opportunity to be heard in person by the Board (with the assistance of the Executive' s counsel if the Executive so desires). No act, nor failure to act, on

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the Executive' s part, shall be considered " intentional" unless the Executive has acted or failed to act, with a lack of good faith and with a lack of reasonable belief that the Executive' s action or failure to act was in the best interest of the Company.

2.5. Change in Control . For purposes of this Agreement, a " Change in Control" shall have occurred if:

(a) a majority of the directors of the Company shall be persons other than persons: (A) for whose election proxies shall have been solicited by the Board, or (B) who are then serving as directors appointed by the Board to fill vacancies on the Board caused by death or resignation (but not by removal) or to fill newly-created directorships;

(b) a majority of the outstanding voting power of the Company shall have been acquired or beneficially owned (as defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended, or any successor rule thereto) by any person (other than the Company, a subsidiary of the Company or the Executive) or Group (as defined below), which Group does not include the Executive; or

(c) there shall have occurred:

(A) a merger or consolidation of the Company with or into another corporation (other than (1) a merger or consolidation with a subsidiary of the Company or (2) a merger or consolidation in which (aa) the holders of voting stock of the Company immediately prior to the merger as a class continue to hold immediately after the merger at least a majority of all outstanding voting power of the surviving or resulting corporation or its parent and (bb) all holders of each outstanding class or series of voting stock of the Company immediately prior to the merger or consolidation have the right to receive substantially the same cash, securities or other property in exchange for their voting stock of the Company as all other holders of such class or series);

(B) a statutory exchange of shares of one or more classes or series of outstanding voting stock of the Company for cash, securities or other property;

(C) the sale or other disposition of all or substantially all of the assets of the Company (in one transaction or a series of transactions); or

(D) the liquidation or dissolution of the Company;

unless more than twenty-five percent (25%) of the voting stock (or the voting equity interest) of the surviving corporation or the corporation or

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other entity acquiring all or substantially all of the assets of the Company (in the case of a merger, consolidation or disposition of assets) or of the Company or its resulting parent corporation (in the case of a statutory share exchange) is beneficially owned by the Executive or a Group that includes the Executive.

2.6. Group . For purposes of this Agreement, " Group" shall mean any two or more persons acting as a partnership, limited partnership, syndicate, or other group acting in concert for the purpose of acquiring, holding or disposing of voting stock of the Company.

2.7. Company . For purposes of this Agreement, " Company" shall mean ABC Bancorp and shall include each of its subsidiaries and its " Successors and Assigns" (as hereinafter defined).

2.8. Disability . For purposes of this Agreement, " Disability" shall mean a physical or mental infirmity which impairs the Executive' s ability to substantially perform his duties with the Company for a period of one hundred eighty (180) consecutive days and the Executive has not returned to his full time employment prior to the Termination Date as stated in the " Notice of Termination" (as hereinafter defined).

2.9. Good Reason .

2.9.1. For purposes of this Agreement, " Good Reason" shall mean a good faith determination by the Executive, in the Executive' s sole and absolute judgment, that any one or more of the following events has occurred, without the Executive' s express written consent, after a Change in Control:

(a) a change in the Executive' s reporting responsibilities, titles or offices as in effect immediately prior to the Change of Control, or any removal of the Executive from, or any failure to re-elect the Executive to, any of such positions which has the effect of diminishing the Executive' s responsibility or authority;

(b) a reduction by the Company in the Executive' s base salary as in effect immediately prior to the Change of Control or as the same may be increased from time to time or a change in the eligibility requirements or performance criteria under any bonus, incentive or compensation plan, program or arrangement under which the Executive is covered immediately prior to the Change of Control which adversely affects the Executive;

(c) the Company requires the Executive to be based anywhere other than within fifty (50) miles of the Executive' s job location at the time of the Change of Control, provided that if the Executive' s job location at such time is not within fifty (50) miles of the Company' s

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principal executive offices, then the Company may thereafter require the Executive to be based within such fifty (50) mile radius without such event constituting Good Reason hereunder;

(d) without replacement by a plan providing benefits to the Executive equal to or greater than those discontinued, the failure by the Company to continue in effect, within its maximum stated term, any pension, bonus, incentive, stock ownership, purchase, option, life insurance, health, accident disability, or any other employee benefit plan, program or arrangement, in which the Executive is participating at the time of the Change of Control, or the taking of any action by the Company that would adversely affect the Executive' s participation or materially reduce the Executive' s benefits under any of such plans;

(e) the taking of any action by the Company that would materially adversely affect the physical conditions existing at the time of the Change of Control in or under which the Executive performs his employment duties, provided that the Company may take action with respect to such conditions after a Change in Control so long as such conditions are at least commensurate with the conditions in or under which an officer of the Executive' s status would customarily perform his employment duties; or

(f) a material change in the fundamental business philosophy, direction, and precepts of the Company and its subsidiaries, considered as a whole, as the same existed prior to the Change of Control.

2.9.2 Any event described in subsection 2.9.1 (a) through (f) which occurs prior to a Change in Control but which the Executive reasonably demonstrates (A) was at the request of a third party who has indicated an intention, or taken steps reasonably calculated, to effect a Change in Control or (B) otherwise arose in connection with, or in anticipation of, a Change in Control which actually occurs, shall constitute Good Reason for purposes hereof, notwithstanding that it occurred prior to a Change in Control.

2.9.3 The Executive' s right to terminate his employment pursuant to this Section 2.9 shall not be affected by his incapacity due to physical or mental illness.

2.10. Notice of Termination . For purposes of this Agreement, " Notice of Termination" shall mean a written notice of termination from the Company, following a Change in Control, of the Executive' s employment which indicates the specific termination provision in this Agreement relied upon and which sets forth in reasonable detail the facts and circumstances claimed t ...