NON-COMPETITION AND NON-DISCLOSURE AGREEMENT


     THIS NON-COMPETITION AND NON-DISCLOSURE AGREEMENT (the "Agreement") is made
this 14th day of April, 1998, by and between J. MORGAN DAVIS (the "Consultant");
and CENIT BANCORP,  INC., a Delaware  corporation (the  "Company"),  CENIT BANK,
FSB, a federal  savings bank (the  "Savings  Bank"),  and CENIT BANK, a Virginia
state chartered commercial bank (the "Bank").

                              W I T N E S S E T H:

     WHEREAS,  the  Consultant  has  heretofore  served as a Director  of and as
President  and Chief  Executive  Officer of the Bank,  and as a Director  of the
Company, which is the sole stockholder of the Bank; and

     WHEREAS,  in such  capacities the  Consultant has become  familiar with all
aspects of and information about (i) the business strategy and business plans of
the Bank, the Company,  and the Savings Bank, the other wholly owned  subsidiary
of the Company  (the Bank,  the Company,  and the Savings  Bank being  sometimes
hereinafter  referred to together as "CENIT"),  (ii) the borrowers,  depositors,
and other  customers of CENIT,  (iii) the marketing,  loan pricing,  and deposit
rate strategies of CENIT,  and (iv) other similar  confidential  and proprietary
information  concerning the business and affairs of CENIT (all such confidential
and  proprietary  information  about the  business  and  affairs of CENIT  being
referred to herein as the "CENIT Confidential Information"); and

     WHEREAS,  by mutual  agreement  among  the  Consultant,  the Bank,  and the
Company,  the  Consultant has decided to resign as a director and officer of the
Bank and the Company and any subsidiaries of the Bank and the Company, and CENIT
has decided to retain the services of the Consultant as a consultant to CENIT on
and subject to terms and  conditions  set forth in a Consulting  Agreement  (the
"Consulting Agreement"), of even date herewith; and

     WHEREAS, in consideration of the agreement of the Consultant not to compete
with CENIT and not to disclose the CENIT  Confidential  Information as set forth
herein, CENIT has agreed to pay the Consultant the amount described below.

     NOW,  THEREFORE,  in consideration of the mutual promises set forth herein,
the amount to be paid to the Consultant  hereunder,  and other good and valuable
consideration,  the  adequacy and receipt of which is hereby  acknowledged,  the
Consultant and CENIT hereby agree as follows:

1.   Resignation  as  Director  and  Officer.  Effective  as of the date of this
     Agreement,  the  Consultant  has  resigned as a director and officer of the
     Bank,  as a director of the  Company,  and as a director and officer of any
     subsidiaries  of either the Bank or the Company,  and any ventures in which
     either the Bank or the Company or any of their respective  subsidiaries are
     involved.


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2.   Termination  of  Employment  Agreement.  The  Consultant  and the  Bank are
     parties to that certain Employment  Agreement (the "Employment  Agreement")
     dated as of January 30, 1995.  The  Consultant  and the Bank mutually agree
     that  the  Employment  Agreement  is  hereby  terminated  in all  respects,
     effective as of the date hereof,  and that the respective  rights,  duties,
     and  obligations  of the Consultant and CENIT shall be as set forth in this
     Agreement, the Consulting Agreement, the exhibits thereto, and the Release.

3.   Term.  Unless  earlier  terminated  pursuant to the provisions set forth in
     this Agreement, the term of this Agreement shall be twenty-five (25) months
     commencing  as of the  date of  this  Agreement  and  ending  May 1,  2000;
     provided,  however,  that the obligation of the Consultant  under Paragraph
     6.B. shall continue through May 1, 2001.

4.   Duties  of the  Consultant.  The  Consultant  shall  have  the  duties  and
     obligations  set forth in the Consulting  Agreement and shall be subject to
     the agreements, limitations and restrictions set forth herein.

5.   Compensation.

     A.   The Consultant shall continue to receive  compensation and benefits as
          an  employee  of the  Company  through  May 1, 1998,  pursuant  to the
          provisions of the Consulting Agreement.

     B.   In consideration of the agreements of the Consultant set forth in this
          Agreement,  the Bank  shall pay to the  Consultant  during the term of
          this  Agreement,  effective May 2, 1998, if the Consultant is not then
          in default under this Agreement, an amount equal to $13,000 per month.
          All  such  payments  shall  be  payable  in  monthly,  semimonthly  or
          bi-weekly  installments in conformity with the Bank's personnel policy
          relating  to  salaried  employees.  In the  event of the  death of the
          Consultant during the term of this Agreement, and if the Consultant is
          not then in default under this  Agreement,  the Bank shall continue to
          pay such amount to the executor, administrator or legal representative
          of the  Consultant  for the benefit of the  Consultant's  estate for a
          period of one (1) month  following the date of death.  The  Consultant
          acknowledges  and agrees that the payment by the Bank of the amount of
          $13,000 per month to the  Consultant  shall be the total  compensation
          payable by the Bank for the  agreements of the Consultant set forth in
          this  Agreement  and that the Bank shall have no duty or obligation to
          provide  any  other  compensation  or  benefits  of  any  kind  to the
          Consultant under this Agreement.

     C.   The  compensation to be paid to the Consultant under this Agreement is
          expressly  conditioned  upon the full and faithful  performance by the
          Consultant of each of the  agreements of the  Consultant  set forth in
          this Agreement.

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<PAGE>

     D.   Notwithstanding  the other provisions of this Paragraph 5, at any time
          after April 1, 1999, the Consultant shall be entitled to terminate the
          right  to  receive   compensation   under  this  Paragraph  5  and  in
          consideration  thereof  shall be released from the  obligation  not to
          compete with CENIT under Paragraph 6.A. of this Agreement but not from
          the obligation not to disclose CENIT  Confidential  Information  under
          Paragraph  6.B. of this  Agreement.  The  Consultant may exercise this
          right by delivering  written notice to CENIT at least thirty (30) days
          in advance of the date on which the  Consultant  desires to  terminate
          such right to receive compensation.

6.   Noncompetition; Nondisclosure:

     A.   For a period of two (2)  years  from the date of this  Agreement,  the
          Consultant shall not, directly or indirectly, whether or not receiving
          compensation therefor, either as principal,  agent, manager, employee,
          partner,  shareholder,  director,  officer,  consultant  or otherwise,
          become  employed  by, or manage or perform  services  for any business
          operation,  whether  financially  or in any  other  capacity,  if such
          business  operation has a location  within a fifty (50) mile radius of
          the  headquarters of the Company and competes with CENIT. For a period
          of two (2) years from the date of this Agreement, the Consultant shall
          not,  directly or  indirectly,  whether or not receiving  compensation
          therefor,  either as principal,  agent,  manager,  employee,  partner,
          shareholder,  director,  officer,  consultant or otherwise, (i) in any
          way induce or attempt  to induce any  employee  of CENIT to leave such
          employee's  position with CENIT to become  associated  with a business
          competing  in any way with  CENIT or (ii)  induce or attempt to induce
          any  customer of CENIT of either to cease  transacting  business  with
          CENIT or transfer  any part of such  customer's  business to any other
          depository institution.

     B.   For a period of three (3) years from the date of this  Agreement,  the
          Consultant shall hold in a fiduciary capacity for the benefit of CENIT
          all CENIT Confidential Information,  which shall have been obtained by
          the  Consultant  during the  Consultant's  previous  employment by the
          Bank,  service as a director of the Company or during the term of this
          Agreement  and which shall not be or become  public  knowledge  (other
          than by acts by the Consultant or representatives of the Consultant in
          violation of this Agreement). For a period of three (3) years from the
          date of this Agreement,  the Consultant  shall not,  without the prior
          written  consent of CENIT or as may  otherwise  be  required by law or
          legal  process,  communicate  or divulge  any such CENIT  Confidential
          Information to anyone other than CENIT and those persons designated by
          CENIT.

     C.   During  any  period in which the  provisions  of  Paragraph  6.A.  are
          effective,  those  provisions  shall not preclude the Consultant  from
          holding any publicly  traded stock  provided the  Consultant  does not
          acquire any stock interest in any one company in excess of ten percent
          (10%) of the outstanding voting stock of that company.

     D.   Except as provided in Paragraph 6.C.  above,  the Consultant  shall be
          deemed to be in violation of the  provisions  of Paragraph  6.A. if he
          (i) is  employed  by,  manages,  or  performs  services  for a bank or
          company that engages in business or performs  services  similar to the
          business

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<PAGE>

          conducted or services performed by CENIT at the time this Agreement is
          terminated;  (ii)  otherwise  performs work in the financial  services
          industry of a similar  nature to that  performed by the Consultant for
          the Bank  previously  or during the term of this  Agreement;  or (iii)
          solicits or accepts,  other than on behalf of CENIT,  any  competitive
          business  from any  customers  of CENIT or  requests  or  advises  any
          customer  of CENIT to  withdraw,  curtail,  or cancel  the  customer's
          business with CENIT or to refrain from conducting  additional business
          with or procuring additional services from CENIT.

     E.   The parties agree that the restrictions  contained in this Paragraph 6
          are reasonable  and fair. If the  Consultant  competes in violation of
          the terms of this  Paragraph  6, the parties  agree that CENIT will be
          irreparably harmed without an adequate remedy at law. Accordingly, the
          Consultant acknowledges that if he breaches or threatens to breach any
          provision  of  this  Paragraph  6,  CENIT  shall  be  entitled  to  an
          injunction, both preliminary and permanent, restraining the Consultant
          from such breach or  threatened  breach,  but such  injunctive  relief
          shall not  preclude  CENIT from  pursuing all other legal or equitable
          remedies arising out of such a breach.

     F.   The parties have attempted to limit the Consultant's  right to compete
          only to the extent necessary to protect CENIT from unfair competition.
          The parties recognize,  however,  that reasonable people may differ in
          making such a  determination.  Consequently,  the parties hereby agree
          that, if the scope or  enforceability  of a  restrictive  covenant set
          forth in this  Paragraph 6 is in any way disputed at any time, a court
          or  other  trier of fact may  modify  and  reform  such  provision  to
          substitute   such  other  terms  as  are  reasonable  to  protect  the
          legitimate business interests of CENIT.

     G.   References  in this  Paragraph  6 to CENIT shall mean and refer to the
          Bank, Savings Bank and/or the Company and their respective present and
          future affiliates and subsidiaries as the context may require.

     H.   The  provisions of Paragraph 6.A. and Paragraph 6.B. shall survive any
          termination of this Agreement or the Consulting  Agreement by CENIT as
          a consequence  of the breach of any of the provision of this Agreement
          or the Consulting  Agreement by the Consultant,  and the provisions of
          Paragraph 6.B. shall survive any  termination by the Consultant  under
          Paragraph  5.D.  of the  right  to  receive  compensation  under  this
          Agreement.

     I.   The   Consultant   shall  have  the  right  at  any  time  to  seek  a
          determination from CENIT that conduct in which the Consultant proposes
          to engage does not violate the  provisions  of this  Paragraph  6. The
          Consultant  must seek such a  determination  before  engaging  in such
          conduct  and  CENIT  will  use its  best  efforts  to  respond  to the
          Consultant's request for such a determination within fifteen (15) days
          of receipt.

7.   Publicity.  The  Consultant  and CENIT  shall  maintain in  confidence  the
     provisions  of this  Agreement  and  shall not  disclose  the terms of this
     Agreement to any other  person  except as provided in this  paragraph.  The
     Consultant  agrees  that  CENIT may  disclose  the terms of this  

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<PAGE>

          Agreement  and/or the  termination of the Employment  Agreement to the
          extent that  disclosure  is  required  by or deemed to be  appropriate
          under  applicable  federal  or state  banking or  securities  laws and
          regulations or in any litigation to which CENIT may become a party and
          in which  disclosure of the terms of this Agreement is compelled.  The
          Consultant  and CENIT  shall  mutually  agree upon a  statement  to be
          released to the public concerning the Consultant's  resignation of his
          positions as a director and an officer of the Bank and the Company and
          shall otherwise withhold comment on the circumstances surrounding such
          resignation.  The Consultant  agrees that the  limitations  imposed on
          CENIT by this paragraph shall become null and void in the event of the
          termination of this  Agreement  following a breach of the terms hereof
          by the Consultant.

8.   Termination.   CENIT  shall  be  entitled  to  terminate  this   Agreement,
     immediately and without prior notice to the Consultant, in the event of any
     breach or violation by the Consultant of either the terms of this Agreement
     or the  terms of the  Consulting  Agreement  or in the  event of any act or
     omission  prior to or during  the term of this  Agreement  that  would have
     permitted  the Bank to  terminate  the  Employment  Agreement  for cause as
     provided therein. In the event of such termination, the obligation of CENIT
     to pay  compensation  and  other  benefits  to the  Consultant  under  this
     Agreement shall terminate,  and CENIT thereupon shall be entitled to pursue
     all legal and equitable remedies  available to it under this Agreement,  or
     at law or in equity, and any limitations imposed hereby upon CENIT's rights
     and remedies shall be immediately  terminated.  The Consultant's duties and
     obligations  under  Paragraph 6 of this  Agreement  shall  survive any such
     termination.

9.   Notices.   For  the   purposes   of  this   Agreement,   notices  or  other
     communications provided for in this Agreement shall be in writing and shall
     be deemed to have been duly given when hand  delivered to the party to whom
     directed  or  mailed  by  United  States  certified  mail,  return  receipt
     requested, postage prepaid, addressed to such party at such party's address
     last known by the party  giving such  notice.  Each party shall  advise the
     other parties of the  appropriate  address to which notices should be sent.
     Notices of change of address shall be effective  only upon  receipt.  CENIT
     hereby advises the Consultant that all notices to CENIT should be addressed
     to CENIT  Bancorp,  Inc.,  225 West Olney Road,  Norfolk,  Virginia  23510,
     attention: President.

10.  Modification  - Waivers - Applicable  Law. No provisions of this  Agreement
     may be modified,  waived or discharged unless such waiver,  modification or
     discharge is agreed to in writing,  signed by the  Consultant and on behalf
     of CENIT by such officers as may be specifically designated by the Board of
     Directors of the Company.  No waiver of any breach,  condition or provision
     of this  Agreement by any party hereto at any time shall be deemed a waiver
     of similar or  dissimilar  provisions  or  conditions at the same or at any
     prior  or  subsequent  time.  No  agreements  or  representations,  oral or
     otherwise,  express or implied,  with respect to the subject  matter hereof
     have  been made by any party  which  are not set  forth  expressly  in this
     Agreement.  The validity,  interpretation,  construction and performance of
     this  Agreement  shall  be  governed  by the  laws of the  Commonwealth  of
     Virginia.

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<PAGE>

11.  Invalidity-Enforceability.   The  invalidity  or   enforceability   of  any
     provision of this Agreement shall not affect the validity or enforceability
     of any other provision of this Agreement,  which shall remain in full force
     and  effect.  Any  provision  in this  Agreement  which  is  prohibited  or
     unenforceable  in any  jurisdiction  shall,  as to  such  jurisdiction,  be
     ineffective  only to the  extent of such  prohibition  or  unenforceability
     without  invalidating or affecting the remaining provisions hereof, and any
     such  prohibition  or   unenforceability  in  any  jurisdiction  shall  not
     invalidate   or  render   unenforceable   such   provision   in  any  other
     jurisdiction.

12.  Successor  Rights.  This  Agreement  shall  inure to the  benefit of and be
     enforceable  by  the  Consultant's   personal  or  legal   representatives,
     executors,  administrators,  successors, heirs, distributees,  devisees and
     legatees,  and  shall be  binding  upon and  inure  to the  benefit  of the
     Company,  the Savings Bank, and the Bank and any successors thereto and any
     present and future affiliates and subsidiaries  thereof.  If the Consultant
     should die while any  amounts  would  still be  payable  to the  Consultant
     hereunder,  all such amounts,  unless otherwise  provided herein,  shall be
     paid in  accordance  with the terms of this  Agreement to the  Consultant's
     legatee  or  other  designee  or,  if  there  is no such  designee,  to the
     Consultant's estate.

13.  Compliance  with Federal  Statutes and  Regulations.  If the  Consultant is
     suspended and/or  temporarily  prohibited from participating in the conduct
     of the affairs of CENIT by a notice served under Section  8(e)(3) or (g)(1)
     of the Federal  Deposit  Insurance Act (12 U.S.C.  Section  1818(e)(3)  and
     (g)(1)),  CENIT's  obligations to the Consultant under this Agreement shall
     be suspended as of the date of service of any such notice  unless stayed by
     appropriate proceedings.  If the charges in the notice are dismissed, CENIT
     may  in  its  discretion  (i)  pay  the  Consultant  all  or  part  of  the
     compensation  withheld  while its  obligations  under this  Agreement  were
     suspended,  and (ii) reinstate (in whole or in part) any of its obligations
     which were suspended.

     A.   If the  Consultant  is  removed  and/or  permanently  prohibited  from
          participating  in the  conduct of CENIT's  affairs by an order  issued
          under Section 8(e)(4) or (g)(1) of the Federal  Deposit  Insurance Act
          (12 U.S.C.  Section  1818(e)(4) or (g)(1)),  all  obligations of CENIT
          under this  Agreement  pertaining  to CENIT shall  terminate as of the
          effective  date of the order,  but vested rights of the parties hereto
          shall not be affected.

     B.   If either the Bank or the  Savings  Bank is in default  (as defined in
          Section 3(x)(1) of the Federal Deposit Insurance Act 12 U.S.C. Section
          1813(x)(1)),  all obligations  under this Agreement shall terminate as
          of the date of default, but this paragraph shall not affect any vested
          rights of the parties hereto shall not be affected.

     C.   All  obligations  of CENIT under this  Agreement  shall be terminated,
          except to the extent that it is determined  that  continuation  of the
          contract is  necessary to the  continued  operation of the Bank (i) by
          the  appropriate  federal  banking  agency,  at the time  the  Federal
          Deposit  Insurance  Corporation  enters into an  agreement  to provide
          assistance  to or on  behalf of either  the Bank or the  Savings  Bank
          under the authority contained in Section 13(c) of the Federal Deposit

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<PAGE>

          Insurance Act; or (ii) by the appropriate  federal banking agency,  at
          the time such agency approves a supervisory merger to resolve problems
          related to  operation  of either the Bank or the Savings  Bank or when
          either the Bank or the Savings Bank is determined by such agency to be
          in an unsafe or unsound  condition;  but vested  rights of the parties
          hereto shall not be affected.

14.  Headings.   Descriptive  headings  contained  in  this  Agreement  are  for
     convenience   only  and  shall  not   control  or  affect  the  meaning  or
     construction of any provision hereof.

15.  Legal Conflict.  In the event of any conflict between any of the provisions
     of  this  Agreement  and  the  provisions  of any  applicable  statutes  or
     regulations,  as such statutes or regulations  are in effect as of the date
     of this Agreement, the provisions of such statutes or regulations in effect
     as of the date of this Agreement shall control.
 
     IN WITNESS WHEREOF,  the parties have executed this Agreement  effective as
of the date first above written.

                                       CONSULTANT:



                                       _____________________________(SEAL)
                                       J. Morgan Davis


                                       COMPANY:

                                       CENIT BANCORP, INC.



                                       By______________________________
                                             Title:


                                       SAVINGS BANK:

                                       CENIT BANK, FSB



                                       By______________________________
                                             Title:



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                                       BANK:

                                       CENIT BANK



                                       By______________________________
                                             Title:

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