Item 5.02 - Departure of Directors or Principal Officers; Election of Directors;
Appointment of Principal Officers; Compensatory Arrangements of Certain Officers On February 23, 2009, Gary L. Lackey's employment with Granite Mortgage, Inc. ("Granite Mortgage"), the mortgage bank subsidiary of Bank of Granite Corporation (the "Company"), terminated effective immediately. Mr. Lackey served as President, Chief Executive Officer, and Director of Granite Mortgage. His departure was not a result of any disagreement with the Company. On February 24, 2009, Granite Mortgage entered into a Severance Agreement and Release In Full with Mr. Lackey under which Mr. Lackey will receive severance of $432,000, as payable under his Amended and Restated Employment and Noncompetition Agreement dated May 1, 2003 ("Employment Agreement"), plus $12,652 for accrued vacation, in exchange for Mr. Lackey's agreement to terminate his Employment Agreement, to fulfill the non-competition and confidentiality provisions set forth in Mr. Lackey's Employment Agreement, and to release the Company and its subsidiaries, and the directors, employees, and affiliates of the Company and its subsidiaries, from any and all causes of action and claims.
A complete copy of Mr. Lackey's Severance Agreement and Release In Full is filed herewith as Exhibit 10.1 and incorporated herein as if set forth in full. Item 9.01 - Financial Statements and Exhibits
(d) Exhibits
10.1 Severance Agreement and Release In Full

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Signatures Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Bank of Granite Corporation

February 27, 2009 By: /s/ Kirby A. Tyndall

Kirby A. Tyndall Secretary, Treasurer and Chief Financial Officer