Document:

Exhibit 10.38

 

LIFE INSURANCE

 

ENDORSEMENT METHOD SPLIT DOLLAR

 

PLAN AGREEMENT

 

Insurers:                NYL;      GWL;      Ohio Nat’l;      John Hancock;      Midland Nat’l

 

Policy Number(s)  77253545;  85270624;  C 6952611;  BL 09727230:     695007

 

	Bank:	Community Bank of Tri County
	 	 	 
	Insured:	 	James Burke
	 	 	 
	Relationship of Insured to Bank:	Executive

 

The respective rights and duties of the Bank and the Insured
in the above referenced policy shall be pursuant to the terms set forth below:

 

		I.	DEFINITIONS

 

Refer to the policy contract for the definition of all terms
in this Agreement other than the following:

 

“Normal Retirement” shall be defined to mean the Insured
remains employed by the Bank until at least age 65.

 

		II.	POLICY TITLE AND OWNERSHIP

 

Title and ownership shall reside in the
Bank for its use and for the use of the Insured all in accordance with this Agreement. The Bank alone may, to the extent of its
interest, exercise the right to borrow or withdraw on the policy cash values. Where the Bank and the Insured (or assignee, with
the consent of the Insured) mutually agree to exercise the right to increase the coverage under the subject Split Dollar policy,
then, in such event, the rights, duties and benefits of the parties to such increased coverage shall continue to be subject to
the terms of this Agreement.

 

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		III.	BENEFICIARY DESIGNATION RIGHTS

 

The Insured (or assignee) shall have the
right and power to designate a beneficiary or beneficiaries to receive the Insured’s share of the proceeds payable upon the death
of the Insured, and to elect and change a payment option for such beneficiary, subject to any right or interest the Bank may have
in such proceeds, as provided in the Agreement.

 

		IV.	PREMIUM PAYMENT METHOD

 

The Bank shall pay an amount equal to the
planned premiums and any other premium payments that might become necessary to keep the policy in force.

 

		V.	TAX TREATMENT

 

It is agreed by and between the parties
hereto that, because the arrangement established pursuant to this Agreement provides only death benefits by use of a Bank-owned
policy, it is properly reportable and taxable, for income and payroll tax purposes, under the “economic benefit” regime
of the IRS’s 2003 final split dollar regulations, and it should not be considered a nonqualified deferred compensation plan subject
to the restrictions of section 409A of the Internal Revenue Code. Accordingly, annually the Insured will receive a taxable benefit
equal to the assumed cost of insurance as required by the Internal Revenue Service. The Bank (or its administrator) will report
to the Insured the amount of imputed income each year on Form W-2 or its equivalent. No further amounts are reportable in respect
of this Agreement.

 

		VI.	DIVISION OF DEATH PROCEEDS

 

Subject to Paragraphs VII and IX herein, the division of the
death proceeds of the policy is as follows:

 

		A.	Should the Insured be employed by the Bank at the time of death, the Insured’s beneficiary (ies),
designated in accordance with Paragraph III, shall be entitled to an amount equal to the lesser of $500,000 or the net amount
at risk insurance portion of the proceeds. The net amount at risk portion is the total proceeds less the cash value of the
policy.

 

		B.	If the Insured has qualified for Normal Retirement as defined in Paragraph I at the time of death,
the Insured’s beneficiary (ies), designated in accordance with Paragraph III, shall be entitled to an amount equal to the lesser
of $100,000 or the net amount at risk insurance portion of the proceeds. The net amount at risk portion is the total proceeds
less the cash value of the policy.

 

		C.	The Bank shall be entitled to the remainder of such proceeds.

 

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		D.	The Bank and the Insured (or assignees) shall share
in any interest due on the death proceeds on a pro rata basis as the proceeds due each respectively bears to the total proceeds,
excluding any such interest.

 

		VII.	DIVISION OF THE CASH SURRENDER VALUE OF THE POLICY

 

The Bank shall at all times be entitled
to the policy’s entire cash value, as that term is defined in the policy contract, less any policy loans and unpaid interest or
cash withdrawals previously incurred by the Bank and any applicable surrender charges. Such cash value shall be determined as of
the date of surrender or death as the case may be. Neither the Insured nor the Insured’s assignee shall at any time have any interest
in the policy’s cash value.

 

		VIII.	RIGHTS OF PARTIES WHERE POLICY ENDOWMENT OR ANNUITY ELECTION EXISTS

 

In the event the policy involves an endowment
or annuity element, the bank’s right and interest in any endowment proceeds or annuity benefits, on expiration of the deferment
period, shall be determined under the provisions of this Agreement by regarding such endowment proceeds of the commuted value of
such annuity benefits as the policy’s cash value. Such endowment proceeds or annuity benefits shall be considered to be like death
proceeds for the purposes of division under this Agreement.

 

		IX.	TERMINATION OF AGREEMENT

 

This Agreement shall terminate upon the occurrence of any one of the following:

 

		A.	The Insured shall leave the employment of the Bank voluntarily or involuntarily at any time.

 

		B.	Surrender, lapse, or other termination of the Policy by the Bank.

 

Upon such termination, the Insured
(or assignee) shall have a fifteen (15) day option to receive from the Bank an absolute assignment of the policy in
consideration of a cash payment to the Bank, whereupon this Agreement shall terminate. Such cash payment referred to
hereinabove shall be the greater of:

 

		1.	The cash value of the policy on the date of such assignment, as defined in this Agreement; or

 

		2.	The amount of the premiums that have been paid by the Bank prior to the date of such assignment.

 

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If, within said fifteen (15) day period, the Insured fails
to exercise said option, fails to procure the entire aforestated cash payment, or dies, then the option shall terminate, the
Insured (or assignee) shall have no payment obligation hereunder and the Insured (or assignee) agrees that all of the
Insured’s rights, interest and claims in the policy shall terminate as of the date of the termination of this Agreement.

 

The Insured expressly agrees that this
Agreement shall constitute sufficient written notice to the Insured of the Insured’s option to receive an absolute assignment of
the policy as set forth herein. Except as provided above, this Agreement shall terminate upon distribution of the death benefit
proceeds in accordance with Paragraph VI above.

 

		X.	INSURED’S OR ASSIGNEE’S ASSIGNMENT RIGHTS

 

The Insured may not, without the written
consent of the Bank, assign to any individual, trust or other organization, any right, title or interest in the subject policy
nor any rights, options, privileges or duties created under this Agreement.

 

		XI.	AGREEMENT BINDING UPON THE PARTIES

 

This Agreement shall bind the Insured and
the Bank, their heirs, successors, personal representatives and assigns.

 

		XII.	ERISA PROVISIONS

 

The following provisions are part of this
Agreement and are intended to meet the requirements of the Employee Retirement Income Security Act of 1974 (“ERISA”):

 

		A.	Named Fiduciary and Plan Administrator:

 

The “Named Fiduciary and Plan Administrator”
of this Endorsement Method Split Dollar Agreement shall be the Executive Committee of the Board of Trustees of the Bank. As Named
Fiduciary and Plan Administrator, the Bank shall be responsible for the management, control, and administration of this Split Dollar
Plan as established herein. The Named Fiduciary may delegate to others certain aspects of the management and operation responsibilities
of the Plan, including the employment of the advisors and the delegation of any ministerial duties

to qualified individuals.

 

		B.	Funding Policy:

 

The funding policy for this Split Dollar Plan shall
be to maintain the subject policy in force by paying, when due, all premiums required.

 

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		C.	Basis of Payment of Benefits:

 

Direct payment by the Insurer is the basis of payment
of benefits under this Agreement, with those benefits in turn being based on the payment of premiums as provided in this Agreement.

 

		D.	Claim Procedures:

 

Claim forms or claim information as to the subject policy
can be obtained by contacting The Pangburn Group at 800-634-3287. When the Named Fiduciary has a claim which may be covered under
the provisions described in the insurance policy, they should contact the office named above, and they will either complete a claim
form and forward it to an authorized representative of the Insurer or advise the named Fiduciary what further requirements are
necessary. The Insurer will evaluate and make a decision as to payment. If the claim is payable, a benefit check will be issued
in accordance with the terms of this Agreement.

 

In the event that a claim is not eligible under the
policy, the Insurer will notify the Named Fiduciary of the denial pursuant to the requirements under the terms of the policy. If
the Named Fiduciary is dissatisfied with the denial of claim and wishes to contest such claim denial, they should contact the office
named above and they will assist in making an inquiry to the Insurer. All objections to the Insurer’s actions should be in writing
and submitted to the office named above for transmittal to the Insurer.

 

		XIII.	GENDER

 

Whenever in this Agreement words are used in the masculine or
neuter gender, they shall be read and construed as in the masculine, feminine or neuter gender, whenever they should so apply.

 

		XIV.	INSURANCE COMPANY NOT PARTY TO THIS AGREEMENT

 

The Insurer shall not be deemed a party to this Agreement, but
will respect the rights of the parties as herein developed upon receiving an executed copy of this Agreement. Payment or other
performance in accordance with the policy provisions shall fully discharge the Insurer from any and all liability.

 

		XV.	AMENDMENT OR REVOCATION

 

It is agreed by and between the parties
hereto that, during the lifetime of the Insured, this Agreement may be amended or revoked at any time or times, in whole or in
part, by the mutual written consent of the Insured and the Bank.

 

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		XVI.	EFFECTIVE DATE

 

The effective date of this Agreement shall be the 1st day of
September 2010.

 

SEVERABILITY AND INTERPRETATION

 

If a provision of this Agreement is held
to be invalid or unenforceable, the remaining provisions shall nonetheless be enforceable according to their terms. Further, in
the event that any provision is held to be overbroad as written, such provision shall be deemed amended to narrow its application
to the extent necessary to make the provision enforceable to law and enforced as amended.

 

		XVII.	APPLICABLE LAW

 

The validity and interpretation of this
Agreement shall be governed by the laws of the State of Maryland, except to the extent preempted by federal law.

 

Executed at Waldord, MD on the 15th day of March,
2011.

 

Community Bank of TRI-County, Waldorf,
MD

 

	Laura Hewitt	 	By:	/s/ James
    M. Burke	E.V.P
	Witness	 	 	Title

 

	 	 	 	 
	Witness	 	 	

 

    	 	 	6Exhibit 10.39

 

EMPLOYMENT AGREEMENT

 

THIS AGREEMENT (the
“Agreement”) is entered into this 23rd day of April, 2013, by and between Community Bank of Tri-County, with its principal
place of business at 3035 Leonardtown Road, Waldorf, Maryland 20601 (the “Bank”), Todd Capitani (the “Employee”),
and Tri-County Financial Corporation (the “Company”), solely as guarantor of the Bank’s obligations hereunder, and is
effective as of the date hereof (the “Effective Date”).

 

WHEREAS, the
parties desire by this writing to set forth the continuing employment relationship between the Bank and the Employee.

 

NOW, THEREFORE,
in consideration of the mutual covenants contained herein, the Bank and the Employee hereby agree as follows:

 

1.          EMPLOYMENT.
The Employee shall serve the Bank as Executive Vice President and Chief Financial Officer. In such position, the Employee shall
have the duties, responsibilities, functions and authority determined and designated from time to time by the Board of Directors
(the “Board”) and the Chief Executive Officer. The Employee shall render such administrative and management services
to the Bank and its affiliates as are customarily performed by persons in a similar executive capacity.

 

2.          EFFECTIVE
DATE AND TERM. The Bank agrees to employ the Employee for an initial period of three (3) years, beginning on the Effective
Date and ending on the day before the third (3rd) anniversary of the Effective Date, and during the period of any additional extensions
described below (the “Term of Employment”). The parties intend that, at any point in time during the Employee’s employment
hereunder, the then-remaining Term of Employment shall be three (3) years. On the day after the Effective Date and on each day
thereafter, the Term of Employment shall extend by one day, so that, on any date, the term of Employment will expire on the day
before the third (3rd) anniversary of such date. These extensions shall continue unless (a) the Bank notifies the Employee that
it has elected to discontinue the extensions; (b) the Employee notifies the Bank of the employee’s election to discontinue the
extensions; or (c) the Employee’s employment with the Bank is terminated, whether by resignation, discharge or otherwise. On the
earlier of (i) the date on which such notice is given; or (ii) the effective date of a termination of Employee’s Employment with
the Bank, the Term of Employment will convert to a fixed period of three (3) years ending on the day before the third (3rd) anniversary
of such date (provided, however, that subject to any rights of the Employee under this Agreement, the Term of Employment shall
terminate on such earlier date as may be specifically provided in this Agreement in the event of the Employee’s death, voluntary
termination, Disability or termination for Cause). The last day of the Agreement term, as extended in accordance with this Section
2, is referred to in this Agreement as the ‘Expiration Date.’”

 

    		

     

    

 

3.          COMPENSATION
AND BENEFITS.

 

3.1      BASE
SALARY. During the Term of Employment, the Bank agrees to pay the Employee base salary at the rate of $230,000 per annum,
subject to increase from time to time in accordance with the usual practices of the Bank with respect to its review of compensation
for senior executives. Any increase in the Employee’s base salary shall become the “base salary” for purposes
of this Agreement. The Employee’s base salary shall be payable in periodic installments in accordance with the Bank’s
usual practice.

 

3.2      EMPLOYEE
BENEFITS. The Employee shall also be entitled to participate in any and all employee benefit plans, medical insurance plans,
disability income plans, retirement plans, bonus incentive plans and other benefit plans from time to time in effect for senior
executives of the Bank. Such participation shall be subject to (a) the terms of the applicable plan documents, (b) generally applicable
policies of the Bank and (c) the discretion of the Board or any administrative or other committee provided for in, or contemplated
by, such plans.

 

3.3      INCENTIVE
COMPENSATION. The Employee shall be eligible to participate in any incentive compensation or bonus programs sponsored by the
Bank on such terms as the Board may establish for the Employee’s participation.

 

3.4      BUSINESS
EXPENSES. The Bank shall pay, or reimburse, the Employee for reasonable travel and other business expenses incurred by the
Employee in the performance of the Employee’s duties and responsibilities, subject to such reasonable requirements with respect
to substantiation and documentation as may be specified by the Bank.

 

3.5      LEAVE.
The Employee shall be entitled to leave (vacation, sick and personal) in accordance with the Bank’s standard policies for senior
executives. Further, the Board, in its discretion, may grant to the Employee a leave or leaves of absence, with or without pay,
at such time or times and upon such terms and conditions as the Board, in its discretion, may determine.

 

3.6      OTHER
EMPLOYEE BENEFITS. The Employee shall be entitled to participate in any compensatory plans, arrangements or programs the Bank
makes available to its senior executive officers, including, but not limited to, stock compensation programs, supplemental retirement
arrangements, or executive health or life insurance programs, subject to, and on a basis consistent with, the terms and conditions
of such plans, arrangements or programs.

 

3.7      GENERAL.
The Employee’s participation in any plans, arrangements or programs currently in effect or made available in the future shall
not be deemed to be in lieu of other compensation to which the Employee is entitled as described under this Agreement.

 

4.          EXTENT
OF SERVICE. During the Term of Employment, the Employee shall devote his full time, best efforts and business judgment, skills
and knowledge to the advancement of the Bank’s interests and to the discharge of his responsibilities under this Agreement; provided,
however, that the Employee may:

 

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(a)      invest
personal assets in such form or manner as shall not require any material services on the Employee’s part in the operations or affairs
of the entities in which such investments are made, provided that the Employee may not own any interest in an entity that competes
with the Bank or any affiliate (other than up to 4.9% of the outstanding voting stock of such entity that is a publicly-traded
entity); or

 

(b)       serve
on the board of directors of any company not in competition with the Bank or any affiliate, provided that the Employee shall not
render any material services with respect to the operations or affairs of any such company; or

 

(c)      engage
in religious, charitable or other community or non-profit activities which do not impair the Employee’s ability to fulfill his
duties and responsibilities under this Agreement.

 

5.           DEATH.
In the event of the Employee’s death during the Term of Employment, the Employee’s employment (and the Term of Employment)
shall terminate on the date of death. The Bank shall pay to the Employee’s beneficiary, or estate, (a) any compensation due the
Employee through the last day of the calendar month in which death occurred, plus (b) any other compensation or benefits as may
be provided in accordance with the terms and provisions of any applicable plans and programs of the Bank in which the Employee
participated as of the date of death.

 

6.           DISCHARGE
FOR CAUSE.

 

6.1       NOTICE
AND DETERMINATION OF CAUSE. The Bank may terminate the Employee’s employment at any time during the Term of Employment
for Cause, as defined below. Such termination shall be deemed to have occurred for Cause only if:

 

(a)        The
Board, by a separate affirmative vote of at least three-fourths (3/4) of the entire membership, determines that the Employee has:
(i) engaged in acts of personal dishonesty which have resulted in loss to the Bank or one of its affiliates; (ii) intentionally
failed to perform stated duties; (iii) committed a willful violation of any law, rule, regulation (other than traffic violations
or similar offenses); (iv) become subject to the entry of a final cease and desist order which results in substantial loss to the
Bank or one of its affiliates; (v) been convicted of a crime or act involving moral turpitude; (vi) willfully breached the Bank’s
or the Company’s code of conduct and business ethics; (vii) been disqualified or barred by any governmental or self-regulatory
authority from serving in the Employee’s then-current employment capacity or (viii) willfully attempted to obstruct or failed to
cooperate with any investigation authorized by the Board or any governmental or self-regulatory entity. No act or failure to act
on the part of the Employee shall be considered “willful” unless it is done, or omitted to be done, by the Employee in
bad faith or without reasonable belief that the Employee’s action or omission was in the best interests of the Bank. Any act or
failure to act that is based upon authority given pursuant to a resolution duly adopted by the Board of Directors, or upon the
advice of legal counsel for the Bank, shall be conclusively presumed to be done, or omitted to be done, by the Employee in good
faith and in the best interests of the Bank and its affiliates; and

 

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(b)     
At least ten (10) days prior to the vote contemplated by Section 6.1(a), the Bank has
provided the Employee with notice of its intent to discharge the Employee for Cause, detailing with particularity the facts
and circumstances which are alleged to constitute Cause (a “Notice of Intent to Discharge”); and

 

(c)    
After giving the Employee Notice of Intent to Discharge and before taking the vote contemplated by
Section 6.1(a), the Employee is afforded a reasonable opportunity to make both written and oral presentations before the
Board for the purpose of refuting the alleged grounds for Cause for discharge; and

 

(d)     After
the vote contemplated by Section 6.1(a), the Bank has furnished to the Employee a notice of termination which specifies the effective
date of the Employee’s termination of employment (which shall not be earlier than the date on which such notice is deemed given),
and include a copy of a resolution or resolutions adopted by the Board of Directors authorizing the termination of the Employee
for Cause and stating with particularity the facts and circumstances found to constitute Cause for discharge (the “Final Discharge
Notice”).

 

 6.2       SUSPENSION;
FINAL DISCHARGE. Following the provision of Notice of Intent to Discharge, the Bank may temporarily suspend the Employee’s
duties and authority and, in such event, may also suspend the payment of salary and other cash compensation (but not participation
in retirement, insurance and other employee benefit plans). If the Employee is discharged for Cause, all payments withheld during
the suspension period shall be deemed forfeited and shall not be payable to the Employee. If the Bank does not give a Final Discharge
Notice to the Employee within one hundred and twenty (120) days after giving him Notice of Intent to Discharge, the Notice of Intent
to Discharge shall be deemed withdrawn and any future action to discharge the Employee for Cause shall require the Bank to give
the Employee a new Notice of Intent to Discharge.

 

 6.3       EFFECT
OF TERMINATION FOR CAUSE. In the event of termination pursuant to this Section 6, the Term of Employment shall terminate and
the Bank shall pay to the Employee an amount equal to the sum of (a) base salary or other compensation earned through the date
of termination, plus (b) any other compensation or vested benefits as may be provided in accordance with the terms and provisions
of any applicable plans and programs of the Bank. All other obligations of the Bank shall terminate as of the date of termination.

 

7.             DISABILITY.
The Bank may terminate the Employee’s employment (and the Term of Employment) after having established the Employee’s Disability.
For purposes of this Agreement, “Disability” means a physical or mental infirmity that impairs the Employee’s ability
to substantially perform his duties under this Agreement and results in the Employee becoming eligible for long-term disability
benefits under the Bank’s long-term disability plan (or, if the Bank has no such plan in effect, that impairs the Employee’s ability
to substantially perform his full-time duties under this Agreement for a period of one hundred eighty (180) consecutive days).
The Employee shall be entitled to the compensation and benefits provided for under this Agreement for (a) any period during the
Term of Employment and prior to the establishment of the Employee’s Disability during which the Employee is unable to work due
to physical or mental infirmity, or (b) any period of Disability which is prior to the Employee’s termination of employment pursuant
to this Section 7.

 

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8.           TERMINATION
WITHOUT CAUSE. The Board may, by written notice to the Employee, immediately terminate his employment at any time for a reason
other than Cause, in which event the Employee shall be entitled to receive the termination payment set forth in Section 10.2 of
this Agreement, payable in one lump sum within ten (10) days of termination. The Bank shall also continue to provide the Employee
with benefit continuation as set forth in Section 10.3 of this Agreement.

 

9.           VOLUNTARY
TERMINATION BY EMPLOYEE. Subject to Section 11 hereof, the Employee may voluntarily terminate employment with the Bank during
the term of this Agreement, upon at least 60 days’ prior written notice, in which case the Term of Employment shall end and the
Bank shall pay to the Employee an amount equal to the (a) base salary or other compensation earned through the date of termination
plus (b) any other compensation and benefits as may be provided in accordance with the terms and provisions of any applicable benefit
plans and programs of the Bank.

 

10.         CHANGE
IN CONTROL.

 

10.1      DEFINITION OF
CHANGE IN CONTROL. For purposes of this Agreement, a “Change in Control” shall mean the occurrence of any of the
following events:

 

(a)          individuals
who, on the date of this Agreement, constitute the Board of Directors of the Company (the “Incumbent Directors”) cease
for any reason to constitute at least half of the Board of Directors of the Company, provided that any person becoming a director
subsequent to such time, whose election or nomination for election was approved by a vote of at least two-thirds (2/3) of the Incumbent
Directors then on the Board of Directors of the Company (either by a specific vote or by approval of the proxy statement of the
Company in which such person is named as a nominee for director, without written objection to such nomination) shall be an Incumbent
Director; provided, however, that no individual initially elected or nominated as a director of the Company as a result of an actual
or threatened election contest with respect to directors or as a result of any other actual or threatened solicitation of proxies
or consents by or on behalf of any person other than the Board of Directors of the Company shall be deemed to be an Incumbent Director;

 

(b)          any
“person” (as such term is defined in Section 3(a)(9) of the Securities Exchange Act of 1934 (the “Exchange
Act”) and as used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act) is or becomes a “beneficial owner”
(as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 25% or
more of the combined voting power of the Company’s then outstanding securities eligible to vote for the election of the Board
of Directors of the Company (the “Company Voting Securities”); provided, however, that the event described in this
paragraph (b) shall not be deemed to be a Change in Control by virtue of any of the following acquisitions: (A) by the
Company or any subsidiary, (B) by any employee benefit plan (or related trust) sponsored or maintained by the Company or any
subsidiary, (C) by any underwriter temporarily holding securities pursuant to an offering of such securities or (D) a
transaction (other than one described in (c) below) in which Company Voting Securities are acquired from the Company, if a
majority of the Incumbent Directors approve a resolution providing expressly that the acquisition pursuant to this clause (D)
does not constitute a Change in Control under this paragraph (b);

 

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(c)          the
consummation of a merger, consolidation, statutory share exchange or similar form of corporate transaction involving the Company
or any of its subsidiaries that requires the approval of the Company’s stockholders, whether for such transaction or the issuance
of securities in the transaction (a “Business Combination”), unless immediately following such Business Combination:
(A) at least 50% of the total voting power of (x) the corporation resulting from such Business Combination (the “Surviving
Corporation”), or (y) if applicable, the ultimate parent corporation that directly or indirectly has beneficial ownership
of 100% of the voting securities eligible to elect directors of the Surviving Corporation (the “Parent Corporation”),
is represented by the Company Voting Securities that were outstanding immediately prior to such Business Combination (or, if applicable,
is represented by shares into which such Company Voting Securities were converted pursuant to such Business Combination), and such
voting power among (and only among) the holders thereof is in substantially the same proportion as the voting power of such Company
Voting Securities among the holders thereof immediately prior to the Business Combination, (B) no person (other than any employee
benefit plan (or related trust) sponsored or maintained by the Surviving Corporation or the Parent Corporation) is or becomes the
beneficial owner, directly or indirectly, of 25% or more of the total voting power of the outstanding voting securities eligible
to elect directors of the Parent Corporation (or, if there is no Parent Corporation, the Surviving Corporation) and (C) at least
50% of the members of the board of directors of the Parent Corporation (or, if there is no Parent Corporation, the Surviving Corporation)
following the consummation of the Business Combination were Incumbent Directors at the time of the Company Board’s approval of
the execution of the initial agreement providing for such Business Combination; or

 

(d)          the
stockholders of the Company approve a plan of complete liquidation or dissolution of the Company or a sale of all or substantially
all of the Company’s assets.

 

Notwithstanding
the foregoing, a Change in Control shall not be deemed to occur solely because any person acquires beneficial ownership of more
than 25% of Company Voting Securities as a result of the acquisition of Company Voting Securities by the Company which reduces
the number of Company Voting Securities outstanding; provided, that if after such acquisition by the Company such person becomes
the beneficial owner of additional Company Voting Securities that increases the percentage of outstanding Company Voting Securities
beneficially owned by such person, a Change in Control of the Company shall then occur.

 

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 10.2      TERMINATION
PAYMENT. Notwithstanding any provision herein to the contrary, if the Bank (i) terminates the Employee’s employment pursuant
to Section 8 of this Agreement or (ii) terminates the Employee’s employment under this Agreement without the Employee’s prior written
consent and for a reason other than Cause, in connection with or within twelve (12) months after a Change in Control, then the
Employee shall be paid an unreduced lump sum severance benefit equal to the sum of the following items:

 

(a)          Two
(2) times the Employee’s annual base salary (as provided for in Section 3 of this Agreement) at the rate in effect on the date
of the Employee’s termination of employment (including any amount contributed by the Bank on the Employee’s behalf pursuant to
a salary reduction agreement and which is not included in the Employee’s gross income under Sections 125, 132(f) or 402(e)(3) of
the Internal Revenue Code of 1986, as amended); and

 

(b)          Two
(2) times the most recent annual incentive compensation payment made to the Employee (as provided for in Section 3 of this Agreement).

 

The severance benefit payment under this Section 10.2 shall be made to the Employee in one lump sum within ten (10) days of the
Employee’s termination of employment.

 

 10.3      BENEFIT
CONTINUATION. Employee shall also be entitled to continuation of the medical, dental and life insurance benefits existing on
the date of termination at the level in effect, and at the same out-of-pocket premium cost to the Employee, as on the date of termination
for a period of thirty-six (36) months following the Employee’s termination of employment. If the benefits under any benefit plan
or program continued pursuant to this Section 10.3 may not be provided because the Employee is no longer an employee of the Bank
or an affiliate, the Bank shall pay or provide for coverage on a comparable basis for the Employee and, where applicable, the Employee’s
dependents.

 

 10.4     OTHER
TERMINATION. Notwithstanding any other provision of this Agreement to the contrary, the Employee may voluntarily terminate
employment under this Agreement within twelve (12) months following a Change in Control of the Bank or Corporation, and the Employee
shall be entitled to receive the payments and benefit continuation described in Sections 10.2 and 10.3 of this Agreement, upon
the occurrence of any of the following events, or within ninety (90) days thereafter, which have not been consented to in advance
by the Employee in writing: (a) the requirement that the Employee move his primary personal residence, or perform his principal
executive functions, more than thirty-five (35) miles from his primary office as of the date of the Change in Control; (b) a material
reduction in the Employee’s base salary as in effect on the date of the Change in Control or as the same may be increased
from time to time; (c) the failure of the Bank to continue to provide the Employee with compensation and benefits provided for
under this Agreement, as the same may be increased from time to time, or with benefits substantially similar to those provided
to him under any of the employee benefit plans in which the Employee now or hereafter becomes a participant, or the taking of
any action by the Bank which would directly or indirectly reduce any such benefits or deprive the Employee of any material fringe
benefit provided to him at the time of the Change in Control; (d) the assignment to the Employee of duties and responsibilities
materially different from those normally associated with his position as referenced in Section 1; (e) a failure to elect or reelect
the Employee to the Board if the Employee is serving on the Board on the date of the Change in Control; or (f) a material diminution
or reduction in the Employee’s responsibilities or authority (including reporting responsibilities) in connection with his
employment with the Bank.

 

    	 	7	 

     

    

 

11.           LIMITATION
OF BENEFITS UNDER CERTAIN CIRCUMSTANCES. “If the payments and benefits provided pursuant to Section 10 of this Agreement, either
alone or together with other payments and benefits the Employee has the right to receive from the Bank, would constitute a “parachute
payment” under Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”), the payments and benefits
pursuant to Section 10 shall be reduced by the amount, if any, which is the minimum necessary to result in no portion of the payments
and benefits under Section 10 being non-deductible to the Bank pursuant to Section 280G of the Code and subject to the excise tax
imposed under Section 4999 of the Code. If such a reduction is necessary and none of the payments or benefits constitutes a “deferral
of compensation” within the meaning of and subject to Section 409A of the Code, then the reduction shall occur in a manner
the Employee elects in writing prior to the date of payment. If the payments or benefits constitute a deferral of compensation
or if the Employee fails to make an election pursuant to the preceding sentence, then the payments and/or benefits to be reduced
will be determined in a manner which has the least economic cost to the Employee. The Bank’s independent public accountants will
determine any reduction in the payments and benefits to be made pursuant to Section 10; the Bank will pay for the accountant’s
opinion. If the Bank and/or the Employee do not agree with the accountant’s opinion, the Bank will pay to the Employee the maximum
amount of payments and benefits pursuant to Section 10 (as selected by the Employee if the payments and benefits do not constitute
a deferral of compensation) that the opinion indicates have a high probability of not causing any of the payments and benefits
to be non-deductible to the Bank and subject to the excise tax imposed under Section 4999 of the Code.”

 

12.           NO
MITIGATION. In the event of any termination of employment under this Agreement, the Employee shall be under no obligation to
seek other employment or to otherwise mitigate damages, and there shall be no offset against any amounts due to the Employee under
this Agreement for any reason, including, without limitation, on account of any remuneration attributable to subsequent employment.
Any amounts due under this Agreement are in the nature of severance payments or liquidated damages, or both, and are not in the
nature of a penalty.

 

13.           MISCELLANEOUS
PROVISIONS.

 

 13.1      CONFLICTING
AGREEMENTS. The Employee hereby represents and warrants that the execution of this Agreement and the performance of the Employee’s
obligations hereunder will not breach or be in conflict with any other agreement to which the Employee is a party or is bound,
and that the Employee is not now subject to any covenants against competition or similar covenants which would affect the performance
of the Employee’s obligations under this Agreement.

 

    	 	8	 

     

    

 

 13.2      WITHHOLDING.
All payments made under this Agreement shall be net of any tax or other amounts required to be withheld under applicable law.

 

 13.3      ARBITRATION.
The Bank and the Employee agree that any claim, dispute or controversy arising under or in connection with this Agreement (including,
without limitation, any such claim, dispute or controversy arising under any federal, state or local statute, regulation or ordinance
or any of the Bank’s employee benefit plans, policies or programs) shall be resolved solely and exclusively by binding arbitration.
The arbitration shall be held in the County of Charles, Maryland (or at such other location as shall be mutually agreed upon by
the parties). The arbitration shall be conducted in accordance with the Commercial Arbitration Rules (the “Rules”) of
the American Arbitration Association (the “AAA”) in effect at the time of the arbitration, except that the arbitrator
shall be selected by alternatively striking from a list of five arbitrators supplied by the AAA. All fees and expenses of the arbitration,
excluding a transcript, shall be borne equally by the parties. Each party will pay for the fees and expenses of its own attorneys,
experts, witnesses, and preparation and presentation of proofs and post-hearing briefs (unless the Employee prevails on a claim
for which attorney’s fees are recoverable under the Agreement). Any action to enforce or vacate the arbitrator’s award shall be
governed by the Federal Arbitration Act, if applicable, and otherwise by applicable state law. If either the Bank or the Employee
pursues any claim, dispute or controversy against the other in a legal proceeding, other than the arbitration provided for herein,
the responding party shall be entitled to dismissal or injunctive relief regarding such action and recovery of all costs, losses
and attorneys’ fees related to such action. Notwithstanding the provisions of this paragraph, either party may seek injunctive
relief in a court of competent jurisdiction, whether or not the case is then pending before the panel of arbitrators. Following
the court’s determination of the injunction issue, the case shall continue in arbitration as provided herein.

 

 13.4      INDEMNIFICATION
FOR ATTORNEYS’ FEES. In the event any dispute or controversy arising under or in connection with the Employee’s termination
of employment or this Agreement is resolved in favor of the Employee, whether by judgment, arbitration or settlement, the Employee
shall be entitled to the payment of: (i) all legal fees and expenses incurred by the Employee in resolving such dispute or controversy,
and (ii) any back-pay, including salary, bonuses and any other cash compensation, fringe benefits and any compensation and benefits
due to the Employee under this Agreement.

 

 13.5      ASSIGNMENT;
SUCCESSORS AND ASSIGNS, ETC.

 

(a)         This
Agreement is personal to the Employee and shall not be assignable by the Employee without the prior written consent of the Bank,
other than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by
the Employee’s legal representatives.

 

(b)         This
Agreement shall inure to the benefit of and be binding upon the Bank and its successors and permitted assigns.

 

    	 	9	 

     

    

 

(c)          The
Bank may not assign this Agreement or any interest herein without the prior written consent of the Employee and, without such consent,
any attempted transfer or assignment shall be null and void and of no effect; provided, however, that the Bank shall require any
successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business
and/or assets of the Bank expressly to assume and to agree to perform this Agreement in the same manner and to the same extent
that the Bank would have been required to perform it if no such succession had taken place. As used in this Agreement, “the
Bank” shall mean both the Bank and the Company, as defined above, and any successor that assumes and agrees to perform this
Agreement, by operation of law or otherwise.

 

 13.6       ENFORCEABILITY.
If any portion or provision of this Agreement shall to any extent be declared illegal or unenforceable by a court of competent
jurisdiction, then the remainder of this Agreement, or the application of such portion or provision in circumstances other than
those as to which it is so declared illegal or unenforceable, shall not be affected thereby, and each portion and provision of
this Agreement shall be valid and enforceable to the fullest extent permitted by law.

 

 13.7       REDUCTIONS;
REGULATORY REQUIREMENTS. Notwithstanding anything to the contrary contained in this Agreement, any and all payments and benefits
to be provided to the Employee under this Agreement are subject to reduction to the extent required by applicable statutes, regulations,
rules and directives of federal, state and other governmental and regulatory bodies having jurisdiction over the Bank and its affiliates.
The Employee is aware and acknowledges that the Federal Deposit Insurance Corporation has the power to preclude the Bank or its
affiliates from making payments to the Employee under this Agreement under certain circumstances. The Employee agrees that neither
the Bank nor its affiliates shall be deemed to be in breach of this Agreement if it is precluded from making a payment otherwise
payable hereunder by reason of regulatory requirements binding on the Bank or its affiliates, as the case may be.

 

 13.8      WAIVER.
No waiver of any provision of this Agreement shall be effective unless made in writing and signed by the waiving party. The
failure of any party to require the performance of any term or obligation of this Agreement, or the waiver by any party of any
breach of this Agreement, shall not prevent any subsequent enforcement of such term or obligation or be deemed a waiver of any
subsequent breach.

 

 13.9      NOTICES.
Any notices, requests, demands and other communications provided for by this Agreement shall be sufficient if in writing and
delivered in person or sent by registered or certified mail, postage prepaid, and addressed to the Employee at the Employee’s last
known address on the books of the Bank or, in the case of the Bank, at its main office, attention of the Chief Executive Officer
of the Board of Directors.

 

 13.10     AMENDMENT.
This Agreement may be amended or modified only by a written instrument signed by the Employee and a duly authorized representative
of the Bank.

 

    	 	10	 

     

    

 

 

 13.11      NO
EFFECT ON LENGTH OF SERVICE. Nothing in this Agreement shall be deemed to prohibit the Bank from terminating the Employee’s
employment before the end of the Term of Employment with or without notice for any reason. This Agreement shall determine the relative
rights and obligations of the Bank and the Employee in the event of any such termination. In addition, nothing in this Agreement
shall require the termination of the Employee’s employment at the expiration of the Term of Employment. Any continuation of the
Employee’s employment beyond the expiration of the Term of Employment shall be on an “at-will” basis, unless the parties
agree otherwise.

 

 13.12      SOURCE
OF PAYMENTS. The Bank shall make in a timely manner all payments provided for under this Agreement in cash or check from its
general funds. The Company, however, unconditionally guarantees payment and the provision of all amounts and benefits due to the
Employee under this Agreement. If the Bank does not timely pay or provide such amounts and benefits, the Company shall pay or provide
such amounts and benefits.

 

 13.13      ENTIRE
AGREEMENT; EFFECT ON PRIOR AGREEMENTS. This Agreement constitutes the entire agreement between the parties pertaining to its
subject matter and supersedes all prior and contemporaneous agreements, understandings, negotiations, prior draft agreements, and
discussions of the parties, whether oral or written.

 

 13.14      COUNTERPARTS
AND FACSIMILE SIGNATURES. This Agreement may be executed in two or more counterparts, all of which shall be considered one
and the same agreement and shall become effective when one or more counterparts have been signed by each party and delivered to
the other party, it being understood that all parties need not sign the same counterpart. This Agreement may be executed by facsimile
signatures.

 

 13.15      GOVERNING
LAW. This is a Maryland contract and shall be construed under and be governed in all respects by the laws of the State of Maryland,
without giving effect to its conflicts of law principles.

 

14.           EFFECT
OF CODE SECTION 409A. Notwithstanding anything in this Agreement to the contrary, if the Bank in good faith determines, as
of the effective date of the Employee’s termination of employment, that amounts payable to the Employee hereunder, are required
to be suspended or delayed for six months in order to satisfy the requirements of Section 409A of the Code, then the Bank will
so advise the Employee, and any such payments shall be suspended and accrued for six months, whereupon they shall be paid to the
Employee in a lump sum (together with interest thereon at the then-prevailing prime rate). The Employee agrees that the Bank shall
be deemed to be in breach of this Agreement if it delays making a payment otherwise payable hereunder by reason of Section 409A.

 

    	 	11	 

     

    

 

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

 

	ATTEST:	 	COMMUNITY BANK OF TRI-COUNTY
	 	 	 
	/s/ Christy M. Lombardi	 	/s/ William J. Pasenelli
	 	 	 
	 	 	For the Bank
	 	 	 
	ATTEST:	 	TRI-COUNTY FINANCIAL CORPORATION 
	 	 	(As Guarantor)
	 	 	 
	/s/ Christy M. Lombardi	 	/s/ William J. Pasenelli
	 	 	 
	 	 	For the Corporation
	 	 	 
	WITNESS:	 	EMPLOYEE:
	 	 	 
	/s/ Christy M. Lombardi	 	/s/ Todd L. Capitani
	 	 	Todd Capitani

 

    	 	12

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