Copy of Severance and Change in Control Agreement with Thomas M. Crowder



 Exhibit 10.01 
 STATE OF NORTH CAROLINA 
 COUNTY OF HYDE 
 SEVERANCE AND 

 CHANGE IN CONTROL AGREEMENT 
 THIS SEVERANCE AND CHANGE IN CONTROL
AGREEMENT (the “Agreement”) is entered into as of the 29th day of March, 2010 (the “Effective Date”), by and between THE EAST CAROLINA
BANK (“ECB”) and THOMAS M. CROWDER (“Executive”). 
 W I T N E S S E T H: 
 WHEREAS, Executive was employed by ECB as its Executive Vice President and Chief Financial Officer
effective on February 8, 2010, and in such position he shall be expected to provide leadership and guidance in the growth and development of ECB’s business; and, 
 WHEREAS, Executive’s experience and knowledge of banking operations is expected to be of benefit
to ECB in the continuation of its business, and, for that reason, ECB desires to retain Executive’s services as an officer and employee of ECB; and 
 WHEREAS, in connection with Executive’s initial employment, ECB has agreed, subject to the conditions and limitations described herein, (1) to make certain
severance payments to Executive in the event of a termination of Executive’s employment with ECB under certain specified circumstances, (2) to advance funds to Executive for the payment of expenses associated with the relocation of his
residence, subject to Executive’s agreement to repay those funds to ECB, and ECB and Executive desire to enter into this Agreement to set forth the terms and conditions of those arrangements. 
 NOW, THEREFORE, in consideration of the premises and mutual promises, covenants and
conditions hereinafter set forth, and for other good and valuable considerations, the receipt and sufficiency of which hereby are acknowledged, ECB and Executive hereby agree as follows: 
 1. Effective Date of Agreement. This Agreement shall be effective on the Effective Date set out above and shall
remain in effect until terminated as provided herein. 
 2. Termination Without “Cause.” Subject
to the limitations set forth in this Agreement and to the right of ECB to terminate Executive’s employment at any time and for any reason satisfactory to ECB, and except to the extent otherwise provided in Paragraph 3 in the case of a
“Change in Control” (as defined in that Paragraph), if, following the date of this Agreement, and prior to February 8, 2012, ECB terminates Executive’s employment without “Cause” (as defined in Paragraph 6(a))
other than as a result of Executive’s “Disability” (as defined in Paragraph 6(b) below), Executive shall be entitled to receive from ECB, and ECB shall be obligated to pay or cause to be paid to Executive, in a lump sum within 45 days
following the date Executive’s employment is terminated (the “Termination Date”), an amount equal to Executive’s base salary for six months calculated at Executive’s base salary rate in effect on the Termination Date.

 Notwithstanding anything in this Agreement to the contrary, to the extent that Executive is entitled to payments under
Paragraph 3(a) below, then those payments shall be in lieu of the payment provided for under this Paragraph 2, and in no event shall Executive be entitled to receive payments under both Paragraphs. 







 3. Change in Control. 
 (a) Notwithstanding the provisions of Paragraph 2 to the contrary, and subject to the limitations set forth in this Agreement, if at
the effective time of, or any time within twelve months following, a “Change in Control” (as defined in Paragraph 3(b) below): 
 (i) ECB terminates Executive’s employment without “Cause” (as defined in Paragraph 6(a) below) other than as a result of Executive’s “Disability” (as defined in
Paragraph 6(b) below); or 
 (ii) a “Termination Event” (as defined in Paragraph 3(c) below) occurs and,
thereafter, Executive voluntarily terminates his own employment with ECB, following the giving of written notice to ECB and an opportunity for ECB to cure or remedy the Termination Event, in the manner described in Paragraph 3(e) below,

 then Executive shall be entitled to receive from ECB, and ECB shall be obligated to pay or cause to be paid to Executive, an amount equal to
1.50 times Executive’s “base amount” as that term is defined in Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), payable in eighteen equal monthly installments which shall begin within 45 days
following the Termination Date and be made on the same schedule as Executive’s base salary was being paid by ECB on the Termination Date.
 In addition, if Executive chooses to exercise his rights to purchase continued individual health, dental or other insurance coverages under ECB’s group insurance plans pursuant to the Consolidated
Omnibus Budget Reconciliation Act (“COBRA”), ECB shall reimburse Executive for the cost of his continued individual insurance coverages for eighteen months or, if less, the maximum period during which such coverages are available to
Executive under COBRA. 
 Notwithstanding anything in this Agreement to the contrary, to the extent that Executive is entitled
to payments under this Paragraph 3(a), then those payments shall be in lieu of the payment provided for under Paragraph 2 above, and in no event shall Executive be entitled to receive payments under both Paragraphs. 
 (b) For purposes of this Agreement, but only to the extent consistent with the definition of the term “change in control”
under Section 409A of the Internal Revenue Code of 1986, as amended, and regulations promulgated thereunder, as applicable (“Section 409A”), a “Change in Control” shall be deemed to have occurred if, after the Effective
Date: 
 (i) any “Person” (as such term is defined in Sections 3(a)(9) and 13(d)(3) of the Securities
Exchange Act of 1934, as amended), directly or indirectly, acquires beneficial ownership of more than 50% of any class of voting securities entitled to vote in the election of directors of ECB or ECB’s parent holding company, ECB Bancorp, Inc.
(“Bancorp”), or in any manner acquires control of the election of a majority of the directors of ECB or Bancorp (excluding ECB or Bancorp themselves, any wholly-owned subsidiary of ECB or Bancorp, or any employee benefit plan sponsored or
maintained by ECB or Bancorp); 
 (ii) ECB or Bancorp consolidates or merges with or into another corporation, or
otherwise is reorganized, where ECB or Bancorp is not the resulting or surviving corporation in such transaction, unless the transaction involves only two or more of ECB, Bancorp and/or a wholly-owned subsidiary of ECB or Bancorp; or 
 (iii) all or substantially all of ECB’s or Bancorp’s assets are sold or otherwise transferred to or acquired by any other
corporation, association or other person, entity, or group. 
 However, notwithstanding anything contained herein to the
contrary, for purposes of this Agreement the term “Change in Control” shall not include a transaction approved by ECB’s or Bancorp’s Board of Directors that results in ECB or Bancorp merging with, transferring its assets to, or
becoming the subsidiary of, a corporation or entity newly formed at the direction of ECB’s or Bancorp’s Board of

  

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Directors for the purpose of such transaction (including a corporation or entity so formed for the purpose of serving as ECB’s or Bancorp’s parent bank holding company), and in
connection with which transaction the holders possessing, directly or indirectly, a majority of the shares entitled to vote in the election of Bancorp’s directors immediately before the transaction or series of related transactions (other than
those who exercise statutory rights of dissent and appraisal) will hold, directly or indirectly, a majority of the shares entitled to vote in the election of directors of the surviving or transferee entity immediately after the transaction or series
of related transactions. Further, and notwithstanding the other provisions of this Agreement, a transaction or event shall not be considered a Change in Control if, prior to the consummation or occurrence of such transaction or event, ECB and
Executive agree in writing that the same shall not be treated as a Change in Control for purposes of this Agreement, in which event Executive shall be deemed to have forever waived all right to any payment under this Agreement as a result of that
transaction or event, but not to any future transaction or event. 
 (c) For purposes of this Agreement, but only to the
extent consistent with the definition of the term “good reason termination” under Section 409A, a “Termination Event” shall be deemed to have occurred if, without his express written consent: 
 (i) Executive’s annual Base Salary rate is materially reduced below the annual rate in effect as of the effective date of the
Change in Control or as the same shall have been increased from time to time following such effective date; 
 (ii)
Executive’s life insurance, medical or hospitalization insurance, disability insurance, or similar plans or benefits (including any retirement plan) being provided by ECB to Executive as of the effective date of the Change in Control are
materially reduced in their level, scope, or coverage, or any such insurance, plans, or benefits are eliminated without being replaced with substantially similar plans or benefits, unless such reduction or elimination applies proportionately to all
salaried employees of ECB who participated in such plans or benefits prior to such Change in Control; 
 (iii) Executive
is transferred to a job location which is more than 75 miles (by most direct highway route) from his principal work location at the effective date of the Change in Control; or 
 (iv) (A) if ECB continues to exist as a separate entity following the Change in Control, Executive’s duties or
responsibilities are materially reduced such that he no longer serves in the same position with ECB that he occupied immediately prior to the Change in Control, or (B) if as a result of the Change in Control ECB no longer exists as a
separate entity, Executive’s duties or responsibilities are materially reduced such that he is not designated as and does not serve as an executive officer of ECB’s “Successor” (as that term is defined in Paragraph 6(c) below) or
report directly to the Successor’s Chairman, President, or Chief Executive Officer. 
 However, notwithstanding the other
provisions of this Agreement, an event shall not be considered a Termination Event if, prior to the occurrence of such event, ECB and Executive agree in writing that the same shall not be treated as a Termination Event for purposes of this
Agreement, in which event Executive shall be deemed to have forever waived all right to any payment under this Agreement as a result of that event, but not to any future such event. 
 (d) If, prior to the effective date of a Change in Control, but following the date on which ECB’s or Bancorp’s Board of
Directors takes action to approve an agreement (including any definitive agreement or an agreement in principle) relating to that Change in Control, Executive’s employment is terminated by ECB without Cause, thereby obligating ECB to make a
lump sum payment to Executive as described in Paragraph 2 above, and if that Change in Control later becomes effective, then the amount payable to Executive with respect to the termination of his employment shall be as described in Paragraph 3(a)(i)
above rather than the amount described in Paragraph 2; provided, however, that: 
  

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 (i) if ECB previously shall have paid to Executive the lump sum payment described in
Paragraph 2, then the aggregate amount of the monthly payments for which ECB shall be obligated under Paragraph 3(a)(i) shall be reduced by the amount of that lump sum payment, and the remaining amount for which ECB shall be obligated shall be
payable as described in Paragraph 3(a); and, 
 (ii) if, following the termination of his employment, Executive
chose to exercise his rights to purchase continued individual health, dental or other insurance coverages under ECB’s group insurance plans pursuant to “COBRA,” ECB shall be obligated to reimburse Executive for that coverage as
provided above in Paragraph 3(a) above. 
 In no event will Executive be entitled to receive the payments called for under
both Paragraph 2 and Paragraph 3(a)(i), or an aggregate amount of payments in excess of the amount described in Paragraph 3(a). 
 (e) In order to terminate his employment and become entitled to any payments under Section 3(a)(ii) of this Agreement, the Termination Event which gives rise to his right to terminate must occur within twelve months following
the date the Change in Control becomes effective, and Executive must, within 30 days following the occurrence of the Termination Event, give written notice to ECB describing the Termination Event and Executive’s intention to terminate his
employment (a “Notice of Termination Event”). Following its receipt of Executive’s Notice of Termination Event, ECB shall have a period of 30 days within which it may cure or remedy the Termination Event (the “Cure
Period”). A Termination Event shall be deemed to have occurred on the date such action or event giving rise to the Termination Event is implemented or takes effect or, if later, on the date on which notice of the action or event is given
to Executive.
 If Executive gives a Notice of Termination Event to ECB and the Termination Event is not cured or remedied by
ECB during the Cure Period, then, unless Executive previously has given written notice to ECB as provided below that he withdraws the Notice of Termination Event and waives the Termination Event, the Termination Date shall be deemed to be the
earlier of (i) the expiration date of the Cure Period, or (ii) the date following Executive’s receipt of the written notice from ECB in which it notifies Executive that it will not cure or remedy the Termination Event,
and Executive’s employment will terminate on that date. If Executive does not give the required Notice of Termination Event within the 30-day period following the occurrence of a Termination Event as described above, or if Executive gives
the required Notice of Termination Event within the 30-day notice period and the Termination Event is cured or remedied by ECB within the Cure Period or, prior to the end of the Cure Period, Executive gives written notice to ECB that he withdraws
his Notice of Termination Event and waives the Termination Event, then Executive thereafter shall have no right to any payment hereunder with respect to that Termination Event, but he shall retain rights, if any, hereunder with respect to any other
or further Termination Event as to which such notice period has not expired. 
 4. Advance for Payment of
Relocation Expenses. In connection with Executive’s employment with ECB, ECB agrees to advance to Executive, within ten days following the date of this Agreement, the sum of $51,000 for the purpose of his payment of expenses he incurs
in connection with the relocation of his principal residence, including without limitation moving expenses, travel expenses and temporary living expenses. Executive agrees to repay to ECB the amount advanced to him as described above, together with
interest on that amount computed daily at a rate of 2.69% per annum, upon demand by ECB at any time; provided, however, that Executive and ECB agree as follows. 
 (a) On each February 8 following the date of this Agreement, beginning on February 8, 2011 (each such date referred to as
an “Anniversary Date”), if Executive remains employed by ECB on that Anniversary Date, ECB will forgive a portion of the unpaid balance of Executive’s payment obligation to ECB under this Paragraph 4 equal to $17,000 plus accrued but
unpaid interest thereon at the above rate from the date of this Agreement through that Anniversary Date, with the effect

  

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of this subparagraph 4(a) being that, if Executive remains employed by ECB on February 8, 2013, Executive’s full obligation under this Paragraph 4 will have been forgiven by ECB.

 (b) If, prior to February 8, 2013, ECB terminates Executive’s employment without “Cause” (as
defined below in Paragraph 6(a) below) other than as a result of Executive’s Disability, or Executive dies while employed by ECB, ECB will forgive the full amount of Executive’s remaining unpaid obligation under this Paragraph 4, including
all accrued but unpaid interest thereon. 
 (c) If, prior to February 8, 2013, Executive resigns from his employment
with ECB, or his employment with ECB terminates or is terminated, voluntarily or involuntarily (including as a result of Executive’s Disability), other than as described in this Paragraph 4(b) above, then Executive shall be obligated to pay to
ECB the then-current outstanding and unforgiven balance of Executive’s payment obligation under this Paragraph 4, together with unpaid accrued interest, in full within 60 days following termination of Executive’s employment. If
Executive fails to make any such payment to ECB following ECB’s written demand therefor, ECB may deduct all or part of such unpaid amount from, or setoff all or part of such unpaid amount against, any amounts or obligation owed by ECB to
Executive, provided that such deduction or setoff is permissible under and effected in accordance with Treasury Regulation 1.409A-3(j)(4)(xiii). 
 Executive acknowledges and agrees that, except as provided in this Paragraph 4, ECB shall have no obligation for the payment of, or to reimburse him for, any such relocation expenses incurred by him.

 5. Exclusions; Full Satisfaction. Notwithstanding anything contained herein to the contrary,
Executive and ECB expressly agree as follows. 
 (a) This Agreement provides for payments to Executive in connection with
the termination of his employment with ECB only in the limited circumstances described in Paragraphs 2 and 3 above and, except as otherwise specifically provided in those paragraphs, Executive shall have no rights, and ECB shall have no
obligations, under this Agreement in any other circumstances or in connection with any other terminations of Executive’s employment. 
 (b) Executive’s employment with ECB is on an “at will” basis and this Agreement does not constitute an employment contract or an agreement by ECB to employ Executive for any
particular period of time or in any particular capacity. Nothing in this Agreement is intended or should be interpreted to confer upon Executive the right to continue in the employ of ECB or to interfere with or restrict in any way the right of ECB
to discharge Executive or terminate his employment at any time or for any reason whatsoever, with or without Cause, and without any obligation or liability to Executive except as herein provided, it being the intent of the parties hereto only to
provide for payment of the severance benefits specified herein, and the forgiveness of Executive’s obligation to ECB, in the event of the termination of Executive’s employment with ECB under the limited circumstances described in
Paragraphs 2, 3 and 4 of this Agreement. 
 (c) Except with respect to Executive’s rights, if any, expressly
provided for in this Agreement and any separate written agreement pertaining to a payment or benefit to be provided by ECB (including an agreement providing for any form of stock-based compensation), the payments to Executive provided for in this
Agreement shall satisfy and discharge in full all of Executive’s claims against ECB arising out of any termination of Executive’s employment. 
 6. Other Definitions. 
 (a) For purposes of
this Agreement, ECB or its “Successor” (as defined in Subparagraph (c) below) shall have “Cause” to terminate Executive’s employment if: 
 (i) a determination is made by ECB in good faith that Executive: (A) has breached in any material respect any of
the terms or conditions of this Agreement, any employment agreement under which Executive is bound with ECB from time to time, or of any officer or employee

  

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codes of conduct, or ethics, employment or other policies of ECB that apply to Executive or to ECB’s officers and/or employees generally from time to time, (B) fails in any
material respect to perform or discharge his duties or responsibilities of employment in a manner that is competent and reasonably satisfactory to ECB’s Board of Directors, and such failure under this clause is not corrected or cured by
Executive to ECB’s reasonable satisfaction (which shall not be unreasonably withheld by ECB) within 30 days following written notice thereof to Executive), or (C) is engaging or has engaged in willful misconduct or conduct which is
detrimental in any material respect to the business or business prospects of ECB or Bancorp or which has had or likely will have an adverse effect on ECB’s or Bancorp’s business or reputation; 
 (ii) Executive materially violates any applicable federal or state law, or any applicable rule, regulation, order, or statement
of policy promulgated by any governmental agency or authority having jurisdiction over ECB or Bancorp (a “Regulatory Authority,” including but not limited to the North Carolina Commissioner of Banks, the Federal Deposit Insurance
Corporation, the Federal Reserve Board, the Securities and Exchange Commissioner, or any other regulator), that results from Executive’s negligence, willful misconduct, or intentional disregard of such law, rule, regulation, order, or policy
statement and results in any substantial damage, monetary or otherwise, to ECB or Bancorp to their reputation; 
 (iii) during the course of Executive’s employment with or service as an officer of ECB or Bancorp, Executive commits an act of fraud, embezzlement, theft, or proven personal dishonesty (whether or not such act or charge
results in criminal indictment, charges, prosecution, or conviction); 
 (iv) Executive is convicted of any felony
or any criminal offense involving dishonesty or breach of trust, there occurs any event described in Section 19 of the Federal Deposit Insurance Act or any other event or circumstance which disqualifies Executive from serving as an employee,
officer or director of, or a party affiliated with, ECB or Bancorp; or, Executive becomes unacceptable to, or is removed, suspended, or prohibited from participating in the conduct of ECB’s or Bancorp’s affairs (or if proceedings for that
purpose are commenced), by any Regulatory Authority; or 
 (v) Executive is excluded by the carrier or underwriter
from coverage under ECB’s and Bancorp’s then current “blanket bond” or other fidelity bond or insurance policy covering its or their employees, officers, and directors, or there occurs any event that ECB believes, in good faith,
will result in Executive being excluded from such coverage, or having coverage limited as to Executive as compared to other covered employees, officers or directors, pursuant to the terms and conditions of such “blanket bond” or other
fidelity bond or insurance policy. 
 (b) “Disability” shall mean a mental or physical impairment that, in
the sole opinion of ECB’s Board of Directors, renders Executive unable to perform the essential functions of his employment for a period of 90 days or more. 
 (c) “Successor” refers to any Person or entity (corporate or otherwise) into which ECB (or any such Successor) shall be merged or consolidated or to which all or substantially all
ECB’s (or any such Successor’s) assets shall be transferred in any manner. For purposes of this Agreement, all references to ECB shall include any such Successor to ECB which shall have assumed and become liable for ECB’s obligations
hereunder (whether such assumption is by agreement, operation of law, or otherwise).
 7. Section 280G
Matters. It is the intent of the parties hereto that all payments made pursuant to this Agreement be deductible by ECB for federal income tax purposes to the maximum extent permissible under applicable law and regulations, and that no such
payments result in the imposition of an excise tax on Executive. For that purpose, and notwithstanding anything contained in this Agreement to the contrary, Executive and ECB agree as follows. 
  

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 (a) Modification or Reduction of “Parachute Payments.” If the
Compensation Committee of ECB’s Board of Directors, based upon the advice of ECB’s independent certified public accountants or legal counsel, reasonably believes that any payments to be made to or for the benefit of Executive under this
Agreement on account of a Change in Control (whether separately or in combination with other payments or benefits to be made or provided to or for the benefit of Executive pursuant to any other agreements or arrangements) would be deemed to be
“parachute payments” as that term is defined in Section 280G(b)(2)(A) of the Code, without regard to Section 280G(e) of the Code, then the payments provided for under this Agreement or any such other payments or benefits may be
modified or reduced in amount by ECB to the extent (but only to the extent) which, based on the advice of ECB’s independent certified public accountants or legal counsel, the Compensation Committee in good faith deems to be necessary to avoid
the imposition of excise taxes on Executive under Section 4999 of the Code and the disallowance of a deduction to ECB under Section 280G(a) of the Code. 
 In the event the amounts of any payments or benefits are required to be reduced pursuant to this Paragraph 7, the last payments in time shall be reduced first, and if any payments to be reduced
otherwise would be made at the same time, payments or benefits other than cash shall be reduced first. 
 (b)
Survival of Covenants. Executive’s covenants and agreements and ECB’s rights provided for in this Paragraph 7 shall survive and remain fully in effect following any termination of Executive’s employment
with ECB. 
 8. Section 409A Matters. Executive and ECB intend for this Agreement to comply with
Section 409A. For that purpose, and notwithstanding anything contained in this Agreement to the contrary, Executive and ECB agree as follows. 
 (a) Interpretation of Defined Terms. The terms used in this Agreement shall be defined and interpreted in a manner that is consistent with Section 409A and, in the event of any
ambiguity in any of the terms or provisions of this Agreement, those terms or provisions shall be interpreted in a manner so as to comply with the applicable requirements of Section 409A. 
 (b) Treatment of Installment Payments. To the extent Executive is entitled to a series of installment payments under
the provisions of this Agreement, such series of installment payments shall be treated as a series of separate payments for purposes of Section 409A, as applicable. 
 (c) Requirement of “Separation from Service;” Payments to “Specified Employees.” In the case of a payment upon the termination of Executive’s employment, no
payment shall be made under this Agreement unless the termination of employment constitutes a “separation from service” under Section 409A, and, if ECB determines that Executive is a “specified employee” within the meaning
of Section 409A on the date of any such separation from service (the “Separation from Service Date”), then (i) any installment payments (including reimbursement for expenses) which ECB is obligated to pay to Executive
under this Agreement that would result in a tax, interest, and/or penalties under Section 409A if paid during the first six months after the Separation from Service Date shall be delayed and accumulated by ECB and the accumulated amount
shall be payable to Executive in a lump sum on the date that is six months and one week after the Separation from Service Date, with any additional installment payments for which ECB is obligated after that six-month period being payable on the same
schedule as Executive’s Base Salary was being paid by ECB on the Separation from Service Date, and (ii) any lump-sum payment (including reimbursement for expenses) which ECB is obligated to pay to Executive under this Agreement that
would result in a tax, interest, and/or penalties under Section 409A if paid during the first six months after the Separation from Service Date shall be delayed and be payable to Executive in a lump sum on the date that is six months and one
week after the Separation from Service Date. 
 (d) Expense Reimbursement. To the extent Executive is
entitled to the reimbursement of any expenses or in-kind benefits under the provisions of this Agreement that is subject

  

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to Section 409A, the right to such reimbursement or benefit shall not be subject to exchange for another benefit and such reimbursement shall be paid by ECB no later than two and one-half
months after the year in which the expense is incurred, except as otherwise provided in Section 409A. 
 (e)
Authority to Modify Agreement. This Agreement may be amended at any time by ECB, without Executive’s consent, to the extent necessary to comply with, and avoid the imposition on Executive of an excise tax under,
Section 409A; provided, however, that in the event the terms of this Agreement, any payments made hereunder, or any action or inaction by ECB with respect thereto, shall be deemed not to comply with Section 409A, ECB shall not
be liable to Executive for any income or excise taxes or any other amounts imposed on or payable by Executive with respect to any payments made hereunder or for any actions, decisions or determinations made by ECB in good faith.

 (f) Survival of Covenants. Executive’s covenants and agreements and ECB’s rights
provided for in this Paragraph 8 shall survive and remain fully in effect following any termination of Executive’s employment with ECB. 
 9. Compliance with CPP Rules. Executive understands and agrees that Bancorp is a participant in the U.S. Department of the Treasury’s TARP Capital Purchase Program
(the “CPP”), and, as a result, ECB and Bancorp are bound by applicable law, rules, regulations and guidance restricting or pertaining to the compensation of officers and employees of CPP participants which are now in effect or may later be
established (including but not limited to the rules and guidance currently set forth in interim final rules appearing at 31 C.F.R. Part 30 promulgated under Sections 101(a)(1), 101(c)(5) and 111 of the Emergency Economic Stabilization Act of 2008,
as amended by the American Recovery and Reinvestment Act of 2009) (collectively, the “CPP Rules”). Executive and ECB intend for this Agreement and payments and benefits payable to Executive hereunder to comply with the CPP Rules and, for
that purpose, and notwithstanding anything contained in this Agreement to the contrary, Executive and ECB agree as follows. 
 (a) Prohibited Payments; Authority to Modify Agreement. In no event shall ECB have any obligation to make any payment, or provide any compensation (whether in the form of cash, stock or otherwise) or other benefit to
Executive (including without limitation any “Golden Parachute Payment,” as that term is defined in the CPP Rules, or any other payment or benefit payable in connection with or following any termination of Executive’s employment), or
to forgive any portion of Executive’s obligation under Paragraph 4 above, to the extent that ECB’s Board of Directors or its Compensation Committee determines, in its sole judgment, that such payment, compensation, forgiveness, or other
benefit would violate or be prohibited by or inconsistent with the CPP Rules. 
 If, in the sole judgment of ECB’s Board of
Directors or its Compensation Committee, any provision of this Agreement, or any such payment, forgiveness, compensation or benefit which ECB is or becomes obligated to pay or provide to Executive under this Agreement, would violate or be prohibited
by or inconsistent with the CPP Rules, then the Board or that Committee shall have the authority, exercisable unilaterally and without Executive’s consent, to modify any or all of the provisions of this Agreement, or to reduce or eliminate any
such payment, forgiveness, compensation or other benefit, to the extent the Board or Committee, in its sole judgment, considers necessary in order to comply with the CPP Rules, and, in such event, Executive shall have no right and ECB shall have to
obligation with respect to such payment, forgiveness, compensation or other benefit to the extent it is reduced or eliminated as provided above. 
 The Board’s or Committee’s power to modify this Agreement shall be effective for so long as ECB and Bancorp are subject to the CPP Rules. The Board’s or Committee’s action
modifying this Agreement may, but need not, be in the form of a written amendment or supplement to this Agreement, or in the form of a duly adopted resolution.
 (b) Recovery of Bonus and Incentive Compensation. If, in the sole judgment of ECB’s Board of Directors or its Compensation Committee, any payment or benefit paid or provided
to

  

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Executive under this Agreement that the Board or Committee deems to be a “Bonus” or “Incentive Compensation” (as those terms are defined in the CPP Rules) was based on
materially inaccurate financial statements or on any other materially inaccurate performance criteria, that payment or benefit shall not have been earned by Executive, shall be subject to recovery by ECB, and shall be repaid by Executive to ECB
within 15 days after written demand by ECB. Executive’s repayment obligations shall survive termination of this Agreement and shall be effective for as long as ECB and Bancorp are subject to applicable CPP Rules.
 (c) Waiver. Executive hereby acknowledges and agrees that, for as long as Bancorp is a participant in the
CPP, ECB and Bancorp will be bound by the CPP Rules, and any implementing guidance issued by the U.S. Treasury or other federal agencies. Executive hereby grants the waiver required by the U.S. Treasury to release the United States and ECB and
Bancorp from any claims that Executive might otherwise have as a result of any modification of this Agreement, or any reduction or elimination of any payment, forgiveness, compensation or other benefit, as provided above, and agrees to execute such
other documents as ECB, Bancorp or the U.S. Treasury may require to evidence this waiver. 
 (d) Survival of
Covenants. Executive’s covenants and agreements and ECB’s rights provided for in this Paragraph 9 shall survive and remain fully in effect following any termination of Executive’s employment with ECB. 

10. Additional Regulatory Requirements. Notwithstanding anything contained in this Agreement to the
contrary, and in addition to the provisions of Paragraphs 7, 8 and 9 above, it is understood and agreed that ECB (or any of its successors in interest) shall not be required to make any payment or take any other action under this Agreement if:

 (a) it is declared by any Regulatory Authority to be insolvent, in default or operating in an unsafe or unsound
manner; or if 
 (b) in the opinion of counsel to ECB, such payment or action (i) would be prohibited by or
would violate any provision of state or federal law applicable to ECB or Bancorp, including without limitation the Federal Deposit Insurance Act, as now in effect or hereafter amended, (ii) would be prohibited by or would violate any
applicable rules, regulations, orders or statements of policy, whether now existing or hereafter promulgated, of any Regulatory Authority, or (iii) otherwise would be prohibited by any Regulatory Authority. 
 Executive’s covenants and agreements and ECB’s rights provided for in this Paragraph 10 shall survive and remain fully in effect
following any termination of Executive’s employment with ECB. 
 11. Termination of Agreement.
Except as provided in Paragraphs 7, 8, 9 and 10 above, this Agreement automatically shall terminate and become null and void upon any termination of Executive’s employment with ECB; provided, however, that, in the case of a termination
of Executive’s employment which results in an obligation on the part of ECB to make payments as provided for under Paragraphs 2 or 3(a) above, or to forgive all or any portion of Executive’s obligation under Paragraph 4, or which results
in an obligation on the part of Executive to repay to ECB all or a portion of the amount advanced to him as described in Paragraph 4, those obligations of ECB and/or Executive shall remain in effect until fully discharged by payment or other
required action by ECB and/or Executive; and, except as provided above, following any such termination of this Agreement, the Agreement shall be of no further force or effect and Executive shall have no further rights hereunder. 
 12. Taxes; Required Withholdings. Executive shall be solely responsible for any and all federal, state and local
income and other taxes (including excise and employment taxes) owed on account of his or her receipt of the payments or benefits under Paragraphs 2 and 3, or the forgiveness of any portion of his obligation under Paragraph 4, of this Agreement. To
the extent that ECB reasonably believes itself obligated to do so, it may withhold any such taxes from payments made to Executive hereunder. If the amount of any such taxes that ECB believes itself required to withhold and transmit to

  

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any governmental or taxing authority exceeds the amount of any payments then due and payable under this Agreement and from which such withholding may be made, or if no payments are then due and
payable under this Agreement from which such withholding may be made, then ECB may require that Executive pay to it the full amount of any such taxes then due and, if Executive shall fail to make such payment, ECB may itself advance and pay the
amount of those taxes and recover any such payments by offset against future payments due to Executive under this Agreement or otherwise. 
 13. Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon ECB and any corporate or other Successor to ECB, and Executive’s heirs,
successors and assigns. However, notwithstanding anything contained herein to the contrary, neither Executive nor Executive’s estate or any designated beneficiary shall have any right to sell, assign, transfer or otherwise convey the right to
receive any payment under this Agreement. To the extent permitted by law, no benefits payable under this Agreement shall be subject to the claim of any creditor of Executive, Executive’s estate or any designated beneficiary, or to any legal
process by any creditor of any such person. 
 14. Modification; Waiver; Amendments. Except as
otherwise provided in Paragraphs 7, 8, 9 or 10 above, no provision of this Agreement may be modified, waived, or discharged unless such waiver, modification, or discharge is agreed to in writing and signed by the parties hereto. No waiver
by either party hereto, at any time, of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by such other party, shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time. No amendments or additions to this Agreement shall be binding unless in writing and signed by both parties, except as herein otherwise provided. 
 15. Applicable Law. The parties hereto agree that without regard to principles of conflicts of laws, the
internal laws of the State of North Carolina shall govern and control the validity, interpretation, performance and enforcement of this Agreement. 
 16. Severability. The provisions of this Agreement shall be deemed severable and the invalidity or unenforceability of any provision shall not affect the validity or
enforceability of the other provisions hereof. 
 17. Headings. The section and paragraph headings
contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. 
 18. Notices. Except as otherwise may be provided herein, all notices, claims, certificates, requests, demands and other communications hereunder shall be in writing and shall
be deemed to have been duly given when hand delivered or sent by facsimile transmission by one party to the other, or when deposited by one party with the United States Postal Service, postage prepaid, and addressed to the other party at his or its
designated address listed below, or at such other address as such other party shall have designated in a written notice given as provided in this Paragraph: 
  

			
	 If to ECB:
  
 The East Carolina Bank
 35080 U.S. Highway 264
 Engelhard, NC 27824
 Attention: Compensation Committee
	  	 If to Executive:
  
 Thomas M. Crowder
 The East Carolina Bank
 35080 U.S. Highway 264
 Engelhard, NC 27824


 19. Counterparts. This Agreement may be executed in any number of counterparts, and each such counterpart hereof shall be deemed an original instrument, but all such
counterparts together shall constitute but one agreement. 
 20. Entire Agreement. This Agreement
contains the entire understanding and agreement of the parties, and there are no agreements, promises, warranties, covenants or undertakings other than those expressly set forth or referred to herein. 
  

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 IN WITNESS WHEREOF, the
parties have executed this Agreement on the day and year first hereinabove written. 
  

					
	THE EAST CAROLINA BANK
		
	By:	 	 /S/ A. Dwight Utz

		 	     President and Chief Executive Officer
		
	EXECUTIVE	 	
		
	        /S/ Thomas M. Crowder
	 	(SEAL)
		 	     Thomas M. Crowder	 	


  

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