FIRST BANCORP /NC/
EMPLOYMENT AGREEMENT
<DOCUMENT>
<TYPE>EX-10.W
<SEQUENCE>4
<FILENAME>0004.txt
<DESCRIPTION>EMPLOYMENT AGREEMENT
<TEXT>


                                                                    Exhibit 10w.

                               EMPLOYMENT AGREEMENT

               THIS AGREEMENT,  dated and effective this 14th day of September,
2000,  between FIRST BANCORP (a North Carolina  corporation) (the "Company") and
JOHN F. BURNS (the  "Employee").  References  to the  "Company"  herein shall be
deemed to refer to the Company and its subsidiaries taken as a whole, unless the
context requires or the Agreement provides otherwise.

               The Company desires to employ the Employee,  and Employee desires
to be  employed  by the  Company,  on the terms and  subject  to the  conditions
hereinafter  set  forth.  Accordingly,   in  consideration  of  employment,  the
compensation  the  Company  agrees to pay the  Employee,  the  mutual  covenants
contained herein, and for other good and valuable consideration,  the receipt of
which is hereby acknowledged, the parties mutually agree as follows:

               1. Employment and Term. The Company (or one of its  subsidiaries)
will employ Employee, and Employee will be employed by the Company for a term of
three (3) years,  initially as Executive Vice President,  commencing on the date
hereof,  unless sooner  terminated  as  hereinafter  provided.  The term of this
Agreement shall  automatically  be extended for an additional  period of one (1)
year on each anniversary of the date of this Agreement unless either party gives
the  other  written  notice  on or  prior to such  anniversary  date  that  such
extension will not occur.

               2. Duties.  Employee shall at all times faithfully and diligently
perform  Employee's  obligations  under  this  Agreement  and  act in  the  best
interests  of the  Company  and  its  affiliated  companies.  Employee's  duties
hereunder  shall be to act in such  office or capacity as the Company may direct
or change from time to time, and Employee shall perform all duties  necessary or
advisable in order to carry out such functions in an efficient manner.  Employee
shall,  during the term of Employee's  employment  hereunder,  devote Employee's
full time,  best efforts and ability,  skill,  and attention  exclusively to the
furtherance  of the  business  objectives  and  interests of the Company and its
affiliated  companies  during  such  hours and in such a manner as is  generally
customary for  employees of  Employee's  position in businesses of the Company's
type.  Employee shall not be required to have his primary  office  location more
than 50 miles from the city limits of Southern Pines, North Carolina.

               3.            Compensation.
                             ------------

                              (a)  Salary.  For  services  rendered  by Employee
hereunder,  the Company  shall pay  Employee  an annual  salary of not less than
$150,000 plus an amount equal to the

first year's  increase in Employee's  personal  cost of health  insurance at the
Company as compared to such cost with Employee's  employer  immediately prior to
the date of this  Agreement  payable in accordance  with the  customary  payroll
practices of the Company.  Employee's  salary shall be subject to increase  upon
annual  reviews of the Employee's  performance.  Employee will receive an annual
increase  that is at  least  as  much as any  percentage  increase  in the  U.S.
Consumer  Price Index during the twelve months  preceding the date of Employee's
annual  review.  Any  such  increase  will  be  considered  in  determining  the
Employee's  base salary for all  purposes  hereunder.  During the time  Employee
serves as a director of the Company or any of its  subsidiaries,  Employee shall
be paid the fees payable to non-employee directors of such entity.

                              (b)  Reimbursement of Expenses.  The Company shall
pay or reimburse  Employee for all  reasonable  and  necessary  travel and other
expenses  incurred by Employee in performing  Employee's  obligations under this
Agreement, provided that Employee shall present to the Company from time to time
an itemized  account of such expenses in any form  required by the Company.  The
Company  further  agrees to  furnish  Employee  with such other  assistance  and
accommodations as shall be suitable to the character of Employee's position with
the Company and adequate for the performance of Employee's duties hereunder.

                              (c) Fringe Benefits. Employee shall be entitled to
such insurance, pension, profit-sharing and other benefit plans as are or may be
available  generally  to  employees  of the Company to the extent  permitted  by
applicable  laws or government  regulations.  Employee will also be eligible for
participation  in the Company's  Supplemental  Employee  Retirement  Plan, Split
Dollar  Insurance  Plan and Stock Option Plan.  Employee will receive an initial
grant of  10,000  options  under the  Company's  Stock  Option  Plan on the date
hereof.


<PAGE>


                              (d)  Leave.   Employee   shall  be   entitled   to
reasonable time off for vacation,  sick leave,  bereavement leave, jury duty and
military  obligations as are or may become available to employees of the Company
in positions similar to those of Employee, as provided by the Company's policies
as they may be in effect from
time to time.

               4.  Termination.  In  addition  to the  termination  of the terms
specified in Section 1 hereunder,  employment may be terminated under any of the
following provisions:


                              (a) The  employment  of the  Employee  under  this
Agreement may be terminated immediately by the Company if the Company finds that
the Employee shall have (i) demonstrated  gross negligence or willful misconduct
in the execution of Employee's  duties,  (ii)  committed an act of dishonesty or
moral turpitude, or (iii) been convicted of a felony or other serious crime. All
future compensation and benefits, not then accrued, will automatically terminate
if Employee is terminated under this subparagraph (a).

                              (b) The  employment  of the  Employee  under  this
Agreement shall be automatically terminated on the date of the Employee's death.

                              (c) Employer may terminate  Employee's  employment
hereunder  for any reason other than as provided in  subparagraphs  (a) and (b),
but in such case Employer  shall be obligated to pay  Employee's  base salary to
Employee  for the  remainder  of the term  specified  in  Section 1 hereof  (the
"Remaining Term").

                              (d)   Employment   hereunder   may  be  terminated
voluntarily by Employee on forty-five (45) days' written notice to the Company's
Chief  Executive  Officer or Chairman of the Company's  Board of  Directors,  in
which case  Employee will receive his  compensation,  vested rights and employee
benefits accrued through the date of termination of employment.

               5. Other Obligations. All payments and benefits to Employee under
this  Agreement  shall be subject to  Employee's  compliance  with the following
provisions:


                              (a) Assistance in  Litigation.  During the term of
this  Agreement  and for three full years after the  expiration  or  termination
hereof,  Employee shall,  upon reasonable  notice,  furnish such information and
proper assistance to the Company as may reasonably be required by the Company in
connection  with  any  litigation  in  which  it or any of its  subsidiaries  or
affiliates is, or may become,  a party. In connection with such  assistance,  if
substantial  effort or expense is required of Employee after the  termination of
Employee's employment hereunder, the Company will pay reasonable compensation to
Employee and will reimburse him for reasonable out-of-pocket expenses.

                              (b)  Long-Term  Disability.  If the  Employee  has
become disabled as determined under the Company's  long-term  disability plan or
policy then in effect and is terminated  from active  employment,  any remaining
benefits  of this  contract  shall be reduced by any  benefits  received  by the
Employee under the Company's long-term disability plan or policy.  Additionally,
if such a  circumstance  occurs,  the Employee is under an  affirmative  duty to
actively   seek  and  accept   reasonable   alternative   employment   following
termination.  Any  compensation  received by Employee  following  termination or
compensation earnable with reasonable diligence will be deducted from any future
compensation  due the Employee under this  Agreement.  In the event the Employee
fails to seek reasonable alternative employment, the Company's obligation to pay
future compensation shall cease.

                              (c)     Confidential     Information.     Employee
acknowledges  that in the  course  of  Employee's  employment  he  will  acquire
knowledge  of trade and  business  secrets  and other  confidential  data of the
Company, its subsidiaries and any affiliated companies.  Such trade and business
secrets  and  other  confidential  data may  include,  but are not  limited  to,
confidential  product  information,  methods by which the  Company  proposes  to
compete with its business  competitors,  strategic plans,  confidential  reports
prepared  by business  consultant(s)  and  similar  information  relating to the
Company's,  its subsidiaries' or its affiliated companies' products,  customers,
and operations. Employee recognizes that the possible restrictions on Employee's
activities are required for the reasonable  protection of the Company.  Employee
covenants not to knowingly  disclose or reveal to any  unauthorized  person such
confidential business secrets or other confidential data both during the term of
this Agreement and for a period of two (2) years  following  termination of this
Agreement.  Upon  expiration  or  termination  of  Employee's  employment by the
Company,  Employee agrees to return to the Company all documents (both originals
and copies),  including without  limitation,  customer lists, books and records,
form  agreements,   manuals,  and  other  information  (in  whatever  form  such
information may exist,  whether written,  recorded,  in magnetic media, or other


<PAGE>

form) that  comes into  Employee's  possession  during,  by virtue of and in the
course of  Employee's  employment  and which  are in any way  connected  with or
related to the Company's business.

               It is further  understood and agreed that the Company's  right to
require Employee to keep confidential information secret shall not be in lieu of
the Company's  right to monetary  damages in the event  Employee is in breach of
any obligation contained in this Agreement,  and that in the event of any breach
or threatened breach of any of these covenants,  the Company may either, with or
without  pursuing  any action for  damages,  obtain  and  enforce an  injunction
prohibiting Employee from violating said covenants.

                              (d)  Noncompetition  Covenants and Other Covenants
For  Protection  of the  Company.  During  the  term  of  Employee's  employment
hereunder and during the period  following the  termination  of such  employment
specified below as the "Restricted  Period," Employee  separately  covenants for
the benefit of the Company as follows:

                              (i) Employee  shall not,  directly or  indirectly,
promote, be employed by, participate or engage in any activity or business which
is in competition  with the business of the Company,  or any of its subsidiaries
and affiliated companies, including acting, either singly or jointly or as agent
for, or as an employee of, any person or persons,  firm or  corporation  whether
directly or indirectly (as a director, shareholder or investor, partner, lessor,
lessee,  proprietor,  principal agent,  independent contractor,  representative,
consultant or otherwise),  in the  "Restricted  Territory"  (as defined  below).
Ownership  by Employee  of 5% or less of the  outstanding  capital  stock of any
corporation  which is actively  publicly  traded will not be a violation of this
covenant;

                              (ii)  Employee  covenants  that  Employee will not
employ or assist others by active  solicitation to recruit and employ  employees
of the Company or any of the Company's subsidiaries or affiliate companies; and

                              (iii)  Employee  agrees  that  Employee  will not,
directly or indirectly,  on behalf of himself or any third party, make any sales
contacts with, or actively  solicit business from any customer of the Company or
its  subsidiaries  or  affiliate   companies,   for  any  products  or  services
competitive  with those offered by the Company or its subsidiaries or affiliated
companies within the "Restricted Territory" (as defined below).

               The  "Restricted  Period"  following  termination  of  employment
during which Employee will observe the covenants  contained in this Section 5(d)
shall be (A) one year  following  termination  of employment  under Section 4(a)
hereof or if Employee  voluntarily  terminates his employment  hereunder and (B)
for the  Remaining  Term (as defined in Section  4(c) hereof) if  employment  is
terminated pursuant to Section 4(c) hereof.

               "Restricted  Territory"  is defined as the area located  within a
50-mile radius of Southern Pines, North Carolina.

               Notwithstanding  the  foregoing,  the  aforesaid  limitations  on
Employee  contained in this  Section  5(d) shall be null and void if  Employee's
employment hereunder is terminated within one year following a Change in Control
(as defined in Section 8 hereof).

                              (e) It is further  understood  and agreed that the
Company's right to require Employee to keep confidential  information  secret or
not to compete  against the  Company for the agreed upon period  shall not be in
lieu of the  Company's  right to  monetary  damages in the event  Employee is in
breach of any obligation  contained in this Agreement,  and that in the event of
any breach or  threatened  breach of any of these  covenants,  the  Company  may
either,  with or without pursuing any action for damages,  obtain and enforce an
injunction prohibiting Employee from violating said covenants.

                              (f) The parties hereby agree that all of the above
obligations  in this  Section 5 are  reasonable  in nature and are  designed  to
reasonably protect the Company's interests.

               6.  Source  of  Payment.  Subject  to the  terms of any  employee
benefit plan established by the Company and except as otherwise provided by law,
all  payments  provided  under  this  Agreement  shall be paid in cash  from the
general  funds  of the  Company,  and no  special  or  separate  fund  shall  be
established, and no other segregation of assets shall be made to assure payment.
Employee  shall  have  no  right,  title  or  interest  whatsoever  in or to any
investments  which  the  Company  may make to aid the  Company  in  meeting  its
obligations hereunder.  Nothing contained in this Agreement, and no action taken
pursuant to its  provisions,  shall  create or be construed to create a trust of
any kind for the benefit of the Employee. To the extent that any person acquires
a right to receive payments from the Company  hereunder,  such right shall be no
greater than the right of an unsecured creditor of the Company.


<PAGE>


               7. Payments by Company. If the Company shall find that any person
to whom any amount is or was payable  hereunder is unable to care for Employee's
affairs  because of illness or accident,  or is a minor,  or has died,  then the
Company,  if it so elects,  may direct that any  payment  due him or  Employee's
estate (unless a prior claim  therefor has been made by a duly  appointed  legal
representative)  or any part  thereof be paid or applied for the benefit of such
person or to or for the  benefit  of such  person's  spouse,  children  or other
dependents,  an institution  maintaining  or having custody of such person,  any
other  person  deemed by the Company to be a proper  recipient on behalf of such
person  otherwise  entitled  to  payment,  or any of  them in  such  manner  and
proportion as the Company may deem proper. Any such payment shall be in complete
discharge of the liability of the Company therefor.

               8. Change in Control.
                  ------------------

                              (a) If a "Change in Control" occurs while Employee
is employed by the Company,  and  Employee's  employment  is  terminated  by the
Company  or  Employee,  for any reason or no  reason,  other than a  termination
pursuant to Section 4(a) by the Company  herein,  within twelve months after the
Change in  Control,  the Company  shall pay the  Severance  Payment  provided in
Section 8(b) to Employee  within ten days of Employee's  date of  termination of
employment, provide benefits pursuant to Section 8(c) and cause the acceleration
of vesting of benefits described in Section 8(d) to occur.  Notwithstanding  the
foregoing,  Employee's  termination  of employment  shall not be deemed due to a
Change in Control if such  termination  is due to Employee's  death  pursuant to
Section  4(b),  Employee's  disability  pursuant  to  Section  5(b),  Employee's
retirement in accordance with the Company's  retirement  policy,  or pursuant to
Section 4(a).

               In the event of successive Changes of Control,  the provisions of
this Agreement shall apply with respect to each Change of Control.

                              (b)  Employee's  Severance  Payment  shall  be  an
amount equal to the lesser of (i) 2.9 times the amount of Employee's base salary
in effect on the date of the Change in Control  and (ii) the product of 2.99 and
the "base amount" as defined in Section  280G(b)(3) of the Internal Revenue Code
of 1986, as amended, and applicable rules and regulations thereunder.

                              (c) The  Company  shall  provide to  Employee  and
Employee's  spouse  or other  qualified  dependents,  at a cost to  Employee  no
greater than the cost of such  benefits to Employee at the time of the Change in
Control, such hospitalization,  health, medical and dental insurance benefits as
were  available to Employee  (and  Employee's  spouse or  qualified  dependents)
immediately prior to the Change in Control until the earlier to occur of (i) two
years  following  the date of the Change in Control or (ii)  Employee  accepting
employment  pursuant to which he is eligible  for  comparable  health  insurance
benefits.

                              (d) Any non-vested  option to purchase  securities
of the Company  will vest and become  immediately  exercisable  upon a Change in
Control.

                              (e)  "Control"   means  the  power,   directly  or
indirectly, to direct the management or policies of the Company or to vote forty
percent (40%) or more of any class of voting securities of the Company.  "Change
in  Control"  shall  mean a change in Control of the  Company,  except  that any
merger,  consolidation  or corporate  reorganization  in which the owners of the
capital stock entitled to vote ("Voting  Stock") in the election of directors of
the Company prior to said combination own sixty-one percent (61%) or more of the
resulting  entity's Voting Stock shall not be considered a change in control for
the purpose of this Agreement;  provided,  that, without limitation, a Change in
Control  shall be deemed to have  occurred if (i) any  "person" (as that term is
used in Sections  13(d) and  14(d)(2) of the  Securities  Exchange Act of 1934),
other than a trustee or other  fiduciary  holding  securities  under an employee
benefit plan of the Company, is or becomes the beneficial owner (as that term is
used in Section  13(d) of the  Securities  Exchange  Act of 1934),  directly  or
indirectly,  of  thirty-three  percent  (33%) or more of the Voting Stock of the
Company or its  successors;  (ii)  during any period of two  consecutive  years,
individuals  who at the  beginning  of such  period  constituted  the  Board  of
Directors of the Company or its successors (the "Incumbent Board") cease for any
reason to constitute at least a majority thereof;  provided, that any person who
becomes a director  of the Company  after the  beginning  of such  period  whose
election  was  approved by a vote of at least  three-quarters  of the  directors
comprising  the  Incumbent  Board shall be  considered a member of the Incumbent
Board; or (iii) there occurs the sale of all or substantially  all of the assets
of the Company.  Notwithstanding  the  foregoing,  no Change in Control shall be
deemed to occur by virtue of any  transaction  which  results in Employee,  or a
group  of  persons  including  Employee,   acquiring,  directly  or  indirectly,
thirty-three percent (33%) or more of the combined voting power of the Company's
outstanding securities. For purposes of this subparagraph (e), references to the
"Company"  shall  be  deemed  to refer to  First  Bancorp  only,  and not to its
subsidiaries.


<PAGE>


               9. Modification and Waiver.
                  ------------------------

                              (a) Amendment of Agreement. This Agreement may not
be modified or amended  except by an instrument in writing signed by the parties
hereto.

                              (b) Waiver. No term or condition of this Agreement
shall be deemed to have been waived, nor shall there be any estoppel against the
enforcement of any provision

of this Agreement,  except by written  instrument of the party charged with such
waiver or estoppel.  No such written waiver shall be deemed a continuing  waiver
unless specifically  stated therein,  and each such waiver shall operate only as
to the specific term and condition  waived and shall not  constitute a waiver of
such  term  or  condition  for  the  future  or as to any act  other  than  that
specifically waived.

               10.  Severability.  If, for any  reason,  any  provision  of this
Agreement is held invalid,  such invalidity shall not affect any other provision
of this Agreement not held so invalid,  and each such other  provision  shall to
the full extent  consistent  with law continue in full force and effect.  If any
provision of this Agreement shall be held invalid in part, such invalidity shall
in no way affect the rest of such provision not held so invalid, and the rest of
such provision,  together with all other provisions of this Agreement,  shall to
the full extent consistent with law continue in full force and effect.

               11. General Provisions.
                   -------------------

                              (a)  Nonassignability.  Neither this Agreement nor
any right or interest  hereunder  shall be  assignable  by Employee,  Employee's
beneficiaries,  or legal  representatives  without the  Company's  prior written
consent;  provided, that nothing in this paragraph shall preclude the executors,
administrators,  or other legal  representative of Employee or Employee's estate
from assigning any rights hereunder to the person or persons entitled thereto.

                              (b) No  Attachment.  Except as required by law, no
right to receive payments under this Agreement shall be subject to anticipation,
commutation,  alienation,  sale,  assignment,  encumbrance,  charge,  pledge  of
hypothecation or to execution, attachment, levy or similar process or assignment
by operation of law, and any attempt,  voluntary or  involuntary,  to effect any
such action shall be null, void
and of no effect.

                              (c)  Binding  Effect.   This  Agreement  shall  be
binding  upon,  and inure to the benefit of,  Employee and the Company and their
respective successors and assigns.


                              (d) Headings.  Headings in this  Agreement are for
convenience only and shall not be used to interpret or construe its provisions.


                              (e)  Notice.   For  purposes  of  this  Agreement,
written  notice  shall  be  effective  if  personally  delivered  or if  sent by
certified mail, return receipt requested,  to the following addresses or to such
other addresses as either may designate in writing to the other party:


                               Employee:     John F. Burns
                                             40 Highland View Drive
                                             Southern Pines, NC  28387


                               Company:      341 North Main Street
                                             Post Office Box 508
                                             Troy, North Carolina  27371
                                             Attention:  Chief Executive Officer


For purpose of computing time, all time  requirements  under this Agreement will
start on the date mailed or if personally delivered, when delivered.

               12. Governing Law. This Agreement has been executed and delivered
in the State of North Carolina,  and its validity,  interpretation,  performance
and enforcement shall be governed by the laws of such State.


<PAGE>


               13.  Effect of Prior  Agreements.  This  Agreement  contains  the
entire understanding between the parties with reference to the employment of the
Employee,  and  supersedes  any prior  employment  agreement,  understanding  or
arrangement   between  the  Employee  and  the  Company,   its  subsidiaries  or
affiliates.



<PAGE>


               IN  WITNESS  WHEREOF,  the  parties  hereto  have  executed  this
Agreement under seal as of the day and year first above stated.

                                                FIRST BANCORP


                                                By:     /s/ James H. Garner
                                                        ---------------------
                                                        James H. Garner
                                                Title:  President and CEO


                                                EMPLOYEE


                                                        /s/ John F. Burns (SEAL)
                                                        -----------------------
                                                        John F. Burns





</TEXT>
</DOCUMENT>
