Exhibit 10.1

RETIREMENT AND TRANSITION AGREEMENT

This RETIREMENT AND TRANSITION AGREEMENT (“this Agreement”) is made and entered
into by and between F. Spencer Cosby, Jr. (“Cosby”) a resident of the state of
North Carolina, on the one hand, and SIDUS Financial, LLC, (the “Company”) a
North Carolina limited liability company and a wholly owned subsidiary of Yadkin
Valley Bank and Trust, (the “Bank”) a North Carolina state bank, on the other
hand. The Bank and the Company are collectively referred to herein as the
“Employer”.

WHEREAS, Cosby is employed by Employer under the terms of an Amended and
Restated Employment Agreement dated December 31, 2008 (the “Employment
Agreement”).

WHEREAS, Cosby desires to retire from his employment with Employer on
December 31, 2011 (the “Retirement Date”).

WHEREAS, Employer desires that Cosby remain engaged to assist with the
transition of his duties to his successor.

WHEREAS, Employer and Cosby have agreed to certain changes in his position and
duties to be effective from the date of this Agreement until the Retirement
Date.

WHEREAS, Cosby and Employer wish to memorialize their agreement and to resolve
any and all claims, disputes and other matters that may exist between them, if
any, whether they have been raised or not.

NOW, THEREFORE, the parties, intending to be legally bound and for and in
consideration of the promises and agreements contained herein, hereby stipulate
and agree as follows:

1. Retirement and Transition. In connection with Cosby’s retirement and the
transition of his duties to his successor, the parties agree that:

 

  a. Cosby shall retire from his employment with Employer on the Retirement
Date.

 

  b. Cosby hereby resigns as Chief Executive Officer of the Company and as an
officer or director of any other subsidiary or affiliate of the Company, all of
which resignations are effective immediately.

 

  c. Cosby shall continue to serve as an officer of the Company until the
Retirement Date. From the date of this Agreement until the Retirement Date (the
“Transition Period”), Cosby shall serve as senior advisor to Lisa Rogers,
successor executive officer of the Company, and shall work to transition his
knowledge, duties and responsibility to Ms. Rogers. Additionally, Cosby shall
have such appropriate transition, customer relations, and other duties as may be
assigned by the Bank’s Board of Directors from time to time.

 

1

Initials: FSC

--------------------------------------------------------------------------------

  d. During the Transition Period, Cosby shall continue to receive (i) base
salary at his current rate; (ii) his expenses for membership and dues in one
Country Club and one civic club, and any other fringe benefits which are now or
may be or become applicable to the Bank’s executive employees; (iii) the
continued use of the current automobile provided by Employer to Cosby; and
(iv) the right, but not the obligation, to purchase such automobile for its
current fair market value on his Retirement Date. During the Transition Period,
Cosby will not be eligible to receive any bonuses. Cosby will not be entitled to
any severance or any special separation pay upon or following his retirement.
The Bank will continue to cover Cosby under its directors and officers liability
insurance policy during the Transition Period. After Cosby’s retirement, Cosby
will have the same coverage under this policy (or successor policies) and the
same entitlement to corporate indemnification as other retired officers and
directors. The benefits and payments Cosby receives under this Agreement are
conditioned upon (A) his employment through the Retirement Date not being
terminated by Cosby for any reason or by the Company for Cause (as such term is
defined by the Employment Agreement) and (B) Cosby’s performance of and
compliance with the terms of this Agreement and any continued post-employment
obligations under the Employment Agreement as provided in Section 4 of this
Agreement.

2. Release. In exchange for the Company’s release of Cosby from his
post-employment noncompetition obligations as set forth in Section 4 below and
the promises of continued compensation and benefits by Employer set forth in
Section 1 above, which release, promises, compensation and benefits are beyond
any to which Cosby is presently entitled, Cosby agrees to release and forever
discharge Employer, its shareholders, successors, predecessors, parents,
subsidiaries, affiliates, assigns, directors, officers, agents, attorneys,
employees and former employees, insurers, and all persons, corporations or other
entities who might be claimed to be jointly and severally liable with them
(collectively, “the Released Parties”), from any and all claims at law or in
equity based upon, arising from, or relating to Cosby’s employment relationship
with Employer or the conclusion of that relationship, whether or not Cosby knows
of the potential existence of the claim, from the beginning of time to the date
of execution of this Agreement. This release shall include, but is not limited
to, claims under the Age Discrimination in Employment Act, Title VII of the
Civil Rights Act of 1964, the Employee Retirement Income Security Act of 1974,
the Americans With Disabilities Act, the Family and Medical Leave Act, claims of
wrongful discharge, constructive discharge, breach of contract, tortious
interference with contract, negligent misrepresentation, negligent or
intentional infliction of emotional distress, retaliatory discharge, and any
other state or federal statutory or common law theories, including any claim for
attorneys’ fees and costs, which Cosby or anyone claiming by, through or under
him in any way might have or could claim against the Released Parties. This
release by Cosby is specifically intended to release Employer from any and all
obligations under the Employment Agreement. In addition, Cosby knowingly and
intentionally waives any rights to any additional recovery that might be sought
on his behalf against any one or more of the Released Parties by any other
person, entity, local, state or federal government or agency thereof.

 

2

Initials: FSC

--------------------------------------------------------------------------------

This release is not intended to and shall not be construed to release any vested
retirement/401(k) benefits or rights to continuation of health coverage under
COBRA.

3. Additional Representations. Cosby represents and warrants that as of the date
of this Agreement, he has been permitted by Employer to take all leave to which
he has been entitled, that he has been reimbursed for all allowances and
expenses properly incurred on behalf of Employer, that he has been properly paid
for all time worked to date during his employment by Employer and that he has
received all benefits to which he was or is entitled. Cosby acknowledges, agrees
and hereby reaffirms that he is subject to the valid and enforceable
noncompetition and confidentiality obligations contained in the Employment
Agreement that placed certain reasonable and necessary restrictions on his
actions following his employment with Employer and that, except as otherwise
provided in Section 4 below, such restrictions are currently and at all times
have been fully enforceable.

4. Release of Certain Post-Employment Obligations. Effective December 31, 2011,
the Company agrees that Cosby is released from his existing post-employment
noncompetition obligation contained in Section 6(b) of the Employment Agreement
which restricts Cosby from certain competitive activities for eighteen
(18) months after termination of employment; provided, however, nothing
contained in this Section 4 will affect Cosby’s noncompetition obligations
during his continued employment with the Company, or the obligations or remedies
contained in Section 6(a), (c) or (d) of the Employment Agreement and such
obligations and remedies shall be deemed continuing beyond the Retirement Date.

5. No Admission of Liability. Nothing contained in this Agreement shall be
construed as an admission of any liability or violation of any federal, state or
local statute, regulation, common law, or of any duty owed by Cosby, Employer or
any of the Released Parties. As stated above, the forbearance, promises and
compensation provided in consideration of the above release and the obligations
contained herein are intended to resolve any and all claims, disputes and other
matters that may exist between the parties, whether they are known or unknown
and whether they have been raised or not.

6. Non-disparagement; No Encouragement of Claims. Cosby agrees to refrain from
any disparagement, criticism, defamation, slander or libel of Employer, any of
the Released Parties or products, services or businesses. In addition, Cosby
agrees that he shall not initiate or participate in any contact or
communications with any person or entity, including but not limited to current
or former employees, vendors, investors and customers of Employer or any of the
Released Parties, which has the effect of disrupting the orderly operations of
or damaging the reputation of Employer or any of the Released Parties,
employees, products, services or their businesses, unless required by law.
Similarly, Cosby shall not, directly or indirectly, encourage or assist any
person or entity who may file or who has filed a lawsuit, charge, claim or
complaint against any Released Party; provided, however, nothing herein shall
prevent Cosby from responding to a lawful subpoena, reporting to a government
agency or complying with any other legal obligation. If Cosby receives any
subpoena or becomes subject to any legal obligation that implicates this
Section 6, Cosby will provide prompt written notice of that fact to the Employer
(consistent with the notice provisions of this Agreement), and enclose a copy of
the subpoena and any other documents describing the legal obligation.

 

3

Initials: FSC

--------------------------------------------------------------------------------

7. Remedies. It is stipulated that a breach by Cosby of the provisions of this
Agreement or Cosby’s continuing obligations under the Employment Agreement, as
described in Section 4 above, would cause irreparable damage to Employer and/or
the Released Parties. In the event Cosby breaches any of the obligations,
representations or warranties contained in this Agreement or in the Employment
Agreement, the Company, the Bank or any of the Released Parties, as applicable,
shall be entitled to all remedies at law or in equity. If the Company, the Bank
or any of the Released Parties are required to employ attorneys and/or pursue
litigation against Cosby for the breach or enforcement of this Agreement or
Cosby’s continuing obligations under the Employment Agreement, they shall be
entitled to recover from Cosby any attorneys’ fees and litigation expenses
incurred in connection with such efforts. In addition, Employer expressly
reserves the right to seek injunctive relief in the event of a breach or
threatened breach of the obligations contained in this Agreement or the
Employment Agreement.

8. ADEA Waiver Acknowledgment. Cosby acknowledges that: (a) he has at least
twenty-one (21) days to consider this Agreement; (b) he has read and understands
the terms of this Agreement and its effect; (c) he has been advised to consult
and has had the opportunity to consult with an attorney prior to executing this
Agreement; (d) he has signed this Agreement voluntarily and knowingly in
exchange for the consideration described herein, which he acknowledges as
adequate and more than he is otherwise entitled to receive; (e) this Agreement
will become effective seven (7) days after its signature by Cosby and will not
be enforceable or effective until after that seven (7) day period has expired
(the “Effective Date”); (f) within seven (7) days of signature, Cosby may revoke
this Agreement by providing written notice of revocation to Laura Blalock at 204
S. Elm Street, Statesville, NC 28687, before 12:01 a.m. Eastern Time of the
Effective Date; and (g) no attempted revocation after the expiration of the
seven (7) day period shall have any effect on the terms of this Agreement.

9. Cooperation. Cosby agrees that, on appropriate advance notice, he will, if so
requested by either Employer or any of the Released Parties, provide assistance
or information related to any claim, investigation, proceeding or litigation
(threatened or pending) involving Employer or any of the Released Parties and
will freely cooperate and assist Employer or any of the Released Parties in good
faith and to the best of his ability. Further, Cosby agrees that, on appropriate
advance notice, he will, if so requested by either Employer or one of the
Released Parties, provide information and assistance as to any matter related to
Cosby’s duties and responsibilities under the Employment Agreement. The Employer
agrees to reimburse Cosby for all of his reasonable expenses associated with
such cooperation, including travel expenses.

10. Return of Company Property. Cosby agrees to return to Employer, within five
(5) days of the Retirement Date, any and all documents, materials and
information (whether in hard copy, on electronic media or otherwise) and all
keys, access cards, credit cards, computer hardware and software, telephones and
telephone-related equipment and all other property of Employer or the Released
Parties in his possession or control. Further, Cosby shall not retain any copy
of documents, materials or information (whether in hard copy, on electronic
media or otherwise) belonging to Employer or any of the Released Parties.

11. Acknowledgment of Reasonableness. Cosby has carefully read and considered
the provisions of this Agreement, has had the opportunity to consult with an
attorney of Cosby’s choice and agrees that the restrictions set forth in this
Agreement and in the Employment

 

4

Initials: FSC

--------------------------------------------------------------------------------

Agreement are reasonably required for the protection of Employer and the
Released Parties. In the event that any provision relating to the scope of the
restrictions contained in this Agreement or the Employment Agreement shall be
declared by a court of competent jurisdiction to exceed the maximum scope that
such court deems reasonable and enforceable under applicable law, such scope of
restriction held reasonable and enforceable by the court shall thereafter be the
scope of the Employment Agreement and/or this Agreement as may be applicable.

12. Tax Liability. Cosby understands and agrees that to the extent any tax
liability may now or hereafter become due because of this Agreement, such
liability shall be his sole responsibility. On behalf of himself, his heirs,
executors, administrators, successors and assigns, he agrees to pay any taxes,
penalties or interest that may be determined to be due and payable, other than
such taxes as may be withheld from Cosby’s compensation during the Transition
Period. In addition, on behalf of himself, his heirs, executors, administrators,
successors and assigns, Cosby agrees to indemnify and hold Employer harmless for
any and all taxes, penalties, interest or other costs and expenses that may be
or become due as a result of this Agreement, other than such taxes as may be
withheld from Cosby’s compensation during the Transition Period.

13. Notices. Any notice contemplated, required, or permitted under this
Agreement shall be sufficient if in writing and shall be deemed given when
delivered personally or mailed by registered or certified mail, return receipt
requested, to the addresses listed below:

 

a.    To Cosby:    F. Spencer Cosby, Jr.       500 Chesapeake Place      
Greenville, NC 27858 b.    To the Company:    Sidus Financial, LLC       c/o
Yadkin Valley Bank and Trust       204 South Elm Street       Statesville, NC
28687       Attn: Laura Nelson Blalock

14. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of North Carolina, without regard to its
conflicts of laws provisions.

15. Severability. Each provision of this Agreement is intended to be severable.
If any term or provision other than Section 2 of this Agreement is held to be
invalid, void or unenforceable by a court of competent jurisdiction for any
reason whatsoever, such ruling shall not affect the remainder of this Agreement.

16. Voluntary Execution. The parties, intending to be legally bound, apply their
signatures voluntarily and with full understanding of the contents of this
Agreement and after having had ample time to review and study this Agreement.

17. Compliance with TARP CPP. For purposes of clarity, nothing in this Agreement
or in any other agreement, plan, program or arrangement will entitle Cosby to
any payments,

 

5

Initials: FSC

--------------------------------------------------------------------------------

rights or benefits to the extent they are prohibited as a result of the
Company’s participation in the Treasury’s Capital Purchase Program.

18. Entire Agreement. This Agreement constitutes the entire agreement between
Cosby and Employer as of the date hereof with respect to the subject matter
hereof and supersedes any previous understandings, representations, statements
and agreements, whether oral or written, between or among the parties with
respect to the subject matter hereof; provided, however, the provisions
contained in this Agreement shall be in addition to and not in lieu of any
obligations of confidentiality or noncompetition contained in the Employment
Agreement. This Agreement shall not be modified or changed in any way except by
a writing executed by both parties hereto or as otherwise set forth herein this
Agreement.

 

/s/ F. Spencer Cosby, Jr.

 

(Seal)

F. Spencer Cosby, Jr.

Date: July 20, 2011

SIDUS FINANCIAL, LLC

By: Yadkin Valley Bank and Trust Company

Its: Sole Shareholder

YADKIN VALLEY BANK AND TRUST COMPANY

/s/ Laura Nelson Blalock

Laura Nelson Blalock, Human Resources Director

Date: June 30, 2011

 

6

Initials: FSC