Document:

EXECUTIVE EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT
(the “Agreement”) is made as of the ____ day of April, 2013, between Howard Bank (the “Bank” or “Employer”),
a Maryland-chartered trust Company, and Robert A. Altieri, a resident of the State of Maryland (the “Executive”).

 

RECITALS:

 

WHEREAS, the Bank desires
to employ employee on the terms and conditions contained herein and Employee desires to be so employed.

 

In consideration of
the above premises and the mutual agreements hereinafter set forth, the parties hereby agree as follows:

 

1.           DEFINITIONS.
Whenever used in this Agreement, the following terms and their variant forms will have the meaning set forth below:

 

1.1           “Agreement”
means this Agreement and any exhibits incorporated herein together with any amendments hereto made in the manner described in this
Agreement.         

 

1.2           “Affiliate”
means any business entity which controls the Employer, is controlled by or is under common control with the Employer. Unless the
context requires otherwise, the term “Employer” used in this Agreement shall include all Affiliates.

 

1.3           “Area”
means the geographic area within a radius of 20 miles of any office or facility maintained by the Employer from time to time. It
is the express intent of the parties that the Area as defined herein is the area where the Executive performs or performed services
on behalf of the Employer under this Agreement as of, or within a reasonable time prior to, the termination of the Executive's
employment hereunder.

 

1.4           “Board”
means the board of directors of the Bank.

 

1.5           “Business
of the Employer” means the business conducted by the Employer.

 

1.6           “Cause”
means any of the following events or conduct preceding a termination of employment initiated by the Employer:

 

(a)          any
act on the part of the Executive that constitutes, in the reasonable judgment of the Board after consultation with legal counsel,
fraud or dishonesty toward the Employer, toward any employee, officer or director of the Employer, or toward any person doing business
with the Employer;

 

(b)          the
conviction of the Executive of any felony or any other crime involving moral turpitude;

 

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(c)          the
Executive’s entering into any transaction or contractual relationship (other than this Agreement) with, or diversion of business
opportunity from, the Employer (other than on behalf of the Employer or with the prior written consent of the Board); provided,
however, such conduct will not constitute Cause unless the Board delivers to the Executive written notice setting forth (1) the
conduct deemed to qualify as Cause, (2) reasonable remedial action that might remedy such objection, and (3) a reasonable
time (not less than thirty (30) days) within which the Executive may take such remedial action, and the Executive has not taken
the specified remedial action with the specified reasonable time;

 

(d)          the
Executive breaches any of the covenants contained in Sections 5, 6, 7 or 8 hereof;

 

(e)          the
Executive fails to discharge his duties and obligations contained in this Agreement under; and

 

(f)          conduct
by the Executive that results in removal of Executive as an officer or employee of the Employer pursuant to a written order by
any regulatory agency with authority or jurisdiction over the Employer.

 

1.7          “Change
in Control” means the first to occur of any one of the following events:

 

(a)          the
acquisition by any person, persons acting in concert or by an entity of the then outstanding voting securities of either the Bank
or the Company, if, as the result of the transaction, the acquiring person, persons or entity owns securities representing more
than fifty percent (50%) of the total voting power of the Bank or the Company, as the case may be;

 

(b)          within
any twelve-month period (beginning on or after the Effective Date) the persons who were directors of either the Bank or the Company
immediately before the beginning of such twelve-month period (the “Incumbent Directors”) cease to constitute at least
a majority of such board of directors; provided that any director who was not a director as of the Effective Date will be deemed
to be an Incumbent Director if that director was elected to such board of directors by, or on the recommendation of or with the
approval of, at least two-thirds of the directors who then qualified as Incumbent Directors;

 

(c)          the
approval by the stockholders of either the Bank or the Company of a reorganization, merger or consolidation, with respect to which
those persons who were the stockholders of either the Bank or the Company, as the case may be, immediately prior to such reorganization,
merger or consolidation do not, immediately thereafter, own more than fifty percent (50%) of the combined voting power entitled
to vote in the election of directors of the reorganized, merged or consolidated entities; or

 

(d)          
the sale, transfer or assignment of all or substantially all of the assets of the Company or the Bank to any third party.

 

1.8           “Code”
means the Internal Revenue Code of 1986, as amended.

 

1.9           “Company”
means any entity that, on or after the Effective Date, controls the Bank.

 

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1.10         “Company
Information” means Confidential Information and Trade Secrets.

 

1.11         “Confidential
Information” means data and information relating to the business of the Employer (which does not rise to the status of
a Trade Secret) which is or has been disclosed to the Executive or of which the Executive became aware as a consequence of or through
the Executive’s relationship to the Employer and which has value to the Employer and is not generally known to its competitors.
Confidential Information does not include any data or information that has been voluntarily disclosed to the public by the Employer
(except where such public disclosure has been made by the Executive without authorization) or that has been independently developed
and disclosed by others, or that otherwise enters the public domain through lawful means.

 

1.12         “Effective
Date” means April 30, 2013.

 

1.13         “Good
Reason” means the existence of any of the following conditions preceding a termination of employment initiated by the
Executive:

 

(a)          a
material diminution in the powers, responsibilities or duties of the Executive hereunder or a material change as to whom Executive
reports which in the case of Executive is the Chief Executive Officer of the Bank;

 

(b)          the
failure to elect the Executive, or the removal of the Executive, as an Executive Vice President of the Bank and of the Company;

 

(c)          a
material breach of the terms of this Agreement by the Employer;

 

(d)          a
change in the location of the principal office of Executive more than fifty (50) miles from its existing location, which the Employer
and Executive hereby agree to be a material change in the location at which the Executive provides services under this Agreement;
or

 

(e)          a
material reduction in the Executive’s Base Salary, as defined in Section 4.1(a) hereof;

 

provided, however, that no termination
of employment which is triggered by any conduct or event described in this Section 1.13 shall constitute a termination of employment
for Good Reason unless (i) the termination occurs within one (1) year following the initial existence of one or more of the conditions
set forth above, and (ii) the Executive has first provided the Employer with the opportunity to cure the event or conduct by giving
the Employer a written notice within ninety (90) days of the initial existence of one or more of the conditions set forth above
describing in sufficient detail the Executive’s belief that a Good Reason exists, and the Employer fails to cure the condition
prior to the expiration of a thirty (30) day cure period, beginning with the date such notice is received by the Employer.

 

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1.14         “Permanent
Disability” means that the Executive is unable to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous
period of not less than twelve (12) months, as certified by a physician chosen by the Employer and reasonably acceptable to the
Executive. Permanent Disability shall also include a determination of disability that qualifies the Executive for receiving payments
under any long-term disability insurance policy maintained by the Employer under which the Executive is entitled to benefits, provided
that the definition of disability applied under that policy complies with the requirements of Treasury Regulation § 1.409A-3(i)(4).

 

1.15         “Trade
Secrets” means information including, but not limited to, technical or nontechnical data, formulas, patterns, compilations,
programs, devices, methods, techniques, drawings, processes, financial data, financial plans, product plans or lists of actual
or potential customers or suppliers which:

 

(a)          derives
economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by,
other persons who can obtain economic value from its disclosure or use; and

 

(b)          is
the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

 

1.16         “Treasury
Regulations” means 26 C. F. R., the regulations promulgated under the Code.

 

2.           DUTIES.

 

2.1           The
Executive is employed as an Executive Vice President of Howard Bank and President of the mortgage division of the Bank, is subject
to the direction of the Chief Executive Officer, and must perform and discharge well and faithfully the duties which may be assigned
to Executive from time to time by the Employer in connection with the conduct of its business. The duties and responsibilities
of the Executive are set forth on Exhibit A attached hereto.

 

2.2           In
addition to the duties and responsibilities specifically assigned to the Executive pursuant to Section 2.1 hereof, the Executive
must:

 

(a)          devote
substantially all of the Executive’s time, energy and skill during regular business hours to the performance of the duties
of the Executive’s employment (reasonable vacations and reasonable absences due to illness excepted) and faithfully and industriously
perform such duties;

 

(b)          diligently
follow and implement all management policies and decisions communicated to Executive by the Chief Executive Officer and the Board;
and

 

(c)          timely
prepare and forward to the Chief Executive Officer and to the Board all reports and accounting as may be requested of the Executive.

 

2.3           The
Executive must devote the Executive’s entire business time, attention and energies to the Business of the Employer and must
not during the Term of this Agreement be engaged (whether or not during normal business hours) in any other business or professional
activity, whether or not such activity is pursued for gain, profit or other pecuniary advantage; but this will not be construed
as preventing the Executive from:

 

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(a)          investing
the Executive’s personal assets in businesses which are not in competition with the Business of the Employer and which will
not require any services on the part of the Executive in their operation or affairs and in which the Executive’s participation
is solely that of an investor;

 

(b)          purchasing
securities in any corporation whose securities are regularly traded provided that such purchase will not result in Executive collectively
owning beneficially at any time five percent (5%) or more of the equity securities of any business in competition with the Business
of the Employer; and

 

(c)          participating
in civic and professional affairs and organizations and conferences, preparing or publishing papers or books or teaching, subject
to any directions or limitations that might be established by the Chief Executive Officer and the Board from time to time.

 

3.           TERM
AND TERMINATION.

 

3.1          Term.
The term of this Agreement is two (2) years and will commence on the Effective Date and terminate two years thereafter. The initial
term and any renewals thereto are referred to as the (“Term.”). On or before 90 days before the termination date of
the initial term and any renewal terms, the Chief Executive Officer of Employer shall inform Executive whether the Employer will
renew this Agreement. Any renewal of this Agreement and the terms of any such renewal are in the sole discretion of the Employer.
In the event this Agreement expires due to non renewal, this Agreement and Employee’s employment shall terminate on the expiration
date of this Agreement.

 

3.2          Termination.
The employment of the Executive under this Agreement may be terminated prior to the expiration of the Term only as follows, subject
to the conditions set forth below:

 

3.2.1        By
the Employer:

 

(a)          for
Cause at any time, upon written notice to the Executive, including the notice provided for in Section 1.6(c), in which event the
Employer will have no further obligation to the Executive except for the payment of any amounts due and owing under Section 4 on
the effective date of the termination; or

 

(b)          without
Cause at any time, upon written notice to the Executive, in which event the Employer will be required to make the termination payments
(i) under Section 3.7(b) if the termination is effective within twelve months following a Change in Control or (ii) otherwise under
Section 3.7(a).

 

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3.2.2         By
the Executive:

 

(a)          for
Good Reason as provided in Section 1.13, in which event the Employer will be required to make the termination payments under Section
3.7(a); or

 

(b)          without
Good Reason, in which event the Employer will have no further obligation to the Executive except for payment of any amounts due
and owing under Section 4 on the effective date of the termination.

 

3.2.3        At
any time upon mutual, written agreement of the parties, in which event the Employer will have no further obligation to the Executive
except for the payment of any amounts due and owing under Section 4 on the effective date of termination unless otherwise set forth
in the written agreement.

 

3.2.4        Immediately
upon the Executive’s death, in which event the Employer will have no further obligation to the Executive except for the payment
of any amounts due and owing under Section 4 on the effective date of termination. Additionally in such event, all of the Executive’s
stock awards and stock options shall immediately vest upon the effective date of such termination.

 

3.2.5     By
either the Employer or the Executive upon the Permanent Disability of the Executive, in which event the Employer will be required
to make the termination payments under Section 3.7(a); provided that such payment obligations shall be reduced if and to the extent
that the Executive receives payments under any disability insurance or other program maintained by the Employer.

 

3.3          Effect
of Termination. Termination of the employment of the Executive pursuant to Section 3.2 will be without prejudice to any right
or claim, which may have previously accrued to either the Employer or the Executive hereunder and will not terminate, alter, supersede
or otherwise affect the terms and covenants and the rights and duties prescribed in this Agreement.

 

3.4          Suspension
With Pay. Nothing contained herein will preclude the Employer from releasing the Executive of the Executive’s normal
duties and suspending Executive, with pay, during the pendency of any investigation or examination to determine whether or not
Cause exists for termination of Executive.

 

3.5          Suspension
Without Pay. If Executive is suspended and/or temporarily prohibited from participating in the conduct of the Employer’s
affairs by a notice served under Section 8(e)(3) or (g)(1) of the Federal Deposit Insurance Act, the Employer’s
obligations under this Agreement will be suspended as of the date of service thereof, unless stayed by appropriate proceedings.
If the charges in such notice are dismissed, the Employer may in its sole discretion:

 

(a)          pay
Executive all or part of the compensation withheld while its contract obligations were suspended; and/or

 

(b)          reinstate
(in whole or in part) any of its obligations, which were suspended.

 

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3.6           Other
Regulatory Requirements. (a) If the Bank is in default, as defined in Section (3)(x)(1) of the Federal Deposit Insurance
Act, all obligations under this Agreement will terminate as of the date of such default, but no vested rights of the Executive
will be affected. Further, all obligations under this Agreement will be terminated, except, to the extent determined that continuation
of the Agreement is necessary for the continued operation of the Bank:

 

(i)          by
the Director (the “Director”) of the Federal Deposit Insurance Corporation (“FDIC”) or his or her designee,
at the time the FDIC enters into an agreement to provide assistance to or on behalf of the Bank under the authority of the Federal
Deposit Insurance Act; or

 

(ii)         by
the Director or his or her designee, at the time the Director or his or her designee approves a supervisory merger to resolve problems
relating to the operation of the Bank or when the Bank is determined by the Director to be in an unsafe or unsound condition. 

 

(b)          If
any payment hereunder is determined to violate any regulatory requirement applicable to the Employer, Employer may decline to make
such payment or amend the amount or timing of such payment to comply with such regulatory requirements.

 

3.7          Termination
Payments.

 

(a)          
In the event and only in the event employment is terminated by the Employer pursuant to Section 3.2.1(b) or Section 3.2.6 or
by the Executive pursuant to Section 3.2.2(a) or Section 3.2.6 and a Change in Control has not occurred, then commencing with
the first payroll date immediately following the effective date of such termination the Employer will pay to the Executive as severance
pay and liquidated damages an amount equal to the then current Base Salary plus all benefits then received by Executive for a period
equal to the remaining Term plus any Incentive Compensation that may have accrued in the calendar year in which Executive
was terminated, which amounts shall be payable in accordance with the Employer’s normal payroll practices. Additionally
in such event, all of Executive’s stock awards and stock options shall immediately vest upon the effective date of such termination.

 

(b)          In
the event and only in the event a Change in Control has occurred and employment is terminated by Employer pursuant to Section 3.2.1(b)
or by Executive pursuant to Section 3.2.3, the Executive shall be entitled to a lump sum payment equal to the sum of (a) the excess
of (i) two (2) times Executive’s Average Annual Compensation over (ii) the aggregate present value, as determined for federal
income tax purposes, of all other payments to the Executive in the nature of compensation, other than the benefits to which the
Executive is entitled pursuant to the final sentence of this Section 3.7(b), that are treated for federal income tax purposes as
contingent on the Change in Control plus (b) an annual bonus equal to the greater of target or actual bonus for the year in which
employment terminates, pro-rated for the months elapsed in the annual bonus period at the time employment terminates, and shall
be paid such lump sum payment by Employer within ten (10) days of the effective date of termination of employment. As used herein,
the term “Average Annual Compensation” means the average Base Salary and bonus paid to the Executive by the Employer
pursuant to Sections 4.1(a) and 4.1(b)(i) of this Agreement during the most recent three (3) taxable years ending before the date
the Change in Control occurs (or such portion of such period during which the Executive was employed by the Employer). In addition
to the termination payments provided in this Section 3.7, in the event and only in the event a Change in Control has occurred and
this Agreement is terminated by Employer or by Executive pursuant to Section 3.2.3: (i) all of Executive’s stock awards shall
immediately vest; (ii) all of Executive’s unexercised stock options shall become immediately exercisable; and (iii) Employer
shall continue Executive’s medical coverage for a period equal to the remaining Term at the same level as available to employees
of the Employer.

 

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(c)          Notwithstanding
the foregoing, if Executive is a specified employee within the meaning of Section 409A of the Code, no amount payable under Section
3.7(a) or (b) shall be paid before the date that is six months after the effective date of termination of employment, or, if earlier,
the date of the Executive’s death, except to the extent that this Agreement may permit payments within that period without
causing any amount payable pursuant to this Agreement to be included in the Executive’s gross income pursuant to Section
409A(a)(1)(A) of the Code prior to the year in which they payments are received by the Executive. Any payment deferred under this
Section 3.7(c) shall be paid on the Employer’s first normal payroll date after the six-month date or the date of the Executive’s
death, as applicable.

 

4.           COMPENSATION
AND BENEFITS.

 

4.1          Compensation.
The Executive will receive the following salary and benefits:

 

(a)          Base
Salary and Signing Bonus. During the Term, the Executive will receive a base salary at the rate of $225,000 per annum, payable
in substantially equal installments in accordance with the Bank’s regular payroll practices (“Base Salary”).
Commencing on January 1, 2014, The Executive’s Base Salary will increase to $245,000. The Executive’s Base Salary will
be reviewed by the Board annually, and the Executive will be entitled to receive annually an increase in such amount, if any, as
may be determined by the Board. Employer will pay Employee a signing bonus of $50,000 on the Effective Date subject to normal payroll
deductions.

 

(b)          Incentive
Compensation. The following bonuses and other compensation to which the Executive is entitled are referred to herein as
“Incentive Compensation”:

 

(i)          In
addition to Executive’s Base Salary under Section 4.1(a), Employee will annually receive 9% of the pretax income from the
Bank’s retail mortgage operation with no deduction to seek pretax income for corporate overhead allocations (the, “Profit
Sharing”). Any Profit Sharing will be paid in cash and restricted stock in a manner consistent with Employer’s compensation
programs. Except as provided in Section 4.1 (b)(ii), Payment of the Profit Sharing for each year will be made as follows (the,
“Payment Schedule”):

 

a.           50%
by the 31st of each January for Profit Sharing earned during the prior calendar year (the “Initial Year”)

 

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b.           16.66%
by the 31st of January for each of the next three calendar years after the Initial Year for the prior calendar year.

 

(ii)
In the event Employee’s Profit Sharing is less than $50,000 for the calendar year 2013, Employer will pay Employee the difference
between the amount of Profit Sharing earned and $50,000 with such difference being paid in a lump sum on January 31, 2014.

 

In the event Employee’s employment
is terminated by Employer for any reason, Employee shall stop earning Profit Sharing as of the date of termination but shall be
paid all previously earned Profit Sharing pursuant to the Payment Schedule. If Employee’s employment is terminated by Employer
for any reason other than cause and such termination occurs prior to the end of a calendar year, the Payment Schedule will be based
on the Profit Sharing earned from the beginning of such year through the date of termination.

 

(iii)        The
Executive will also be entitled to participate in such other bonus, incentive and other executive compensation programs as are
made available to executive management of the Employer from time to time.

 

(iv)        Employer
will grant Employee on the Effective Date 5000 shares of restricted stock of the Company with such grant vesting equally over three
years commencing on first anniversary of the Effective Date and continuing for the next two anniversaries of the Effective Date.
Employer will take such action as may be necessary to cause the Company to issues such restricted stock. In the event Employee
is terminated for Cause or voluntarily terminates employment with the Employer without Good Reason, Employee shall not receive
and have no rights to any shares granted hereunder but not vested as of the date of such termination.

 

4.2          Business
Expenses; Memberships. The Employer agrees to reimburse the Executive for (a) reasonable business (including travel) expenses
incurred by the Executive in the performance of the Executive’s duties hereunder and (b) the dues and business related
expenditures, including initiation fees, associated with membership in professional associations which are commensurate with the
Executive’s position; provided, however, that the Executive must, as a condition of reimbursement, submit verification of
the nature and amount of such expenses in accordance with reimbursement policies from time to time adopted by the Employer and
in sufficient detail to comply with rules and regulations promulgated by the Internal Revenue Service.

 

4.3          Vacation.
On a non-cumulative basis the Executive will be entitled to vacation in each year of this Agreement in accordance with the Bank’s
vacation policy as then in effect, during which the Executive’s Base Salary will be paid in full.

 

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4.4           Benefits.
In addition to the Base Salary and Incentive Compensation, the Executive will be entitled to such benefits as may be available
from time to time for employees of the Employer. All such benefits will be awarded and administered in accordance with the Employer’s
standard policies and practices. Such benefits may include, by way of example only, health, dental, vision, profit-sharing plans,
retirement, and disability insurance benefits and such other benefits as the Employer deems appropriate. In addition to the benefits
described in this Section 4.4, Employer shall provide to Executive at no cost to Executive, split dollar benefits of a $500,000
key man life insurance policy.

 

4.5           Car
Allowance. Employer shall pay Employee $750.00 per month as a car allowance.

 

4.6           Withholding.
The Employer may deduct from each payment of compensation hereunder all amounts required to be deducted and withheld in accordance
with applicable federal and state income, FICA and other withholding requirements.

 

5.           COMPANY
INFORMATION.

 

5.1           Ownership
of Information. All Company Information received or developed by the Executive while employed by the Employer will remain the
sole and exclusive property of the Employer.

 

5.2           Obligations
of the Executive. The Executive agrees (a) to hold Company Information in strictest confidence, (b) not to use, duplicate,
reproduce, distribute, disclose or otherwise disseminate Company Information or any physical embodiments thereof and (c) not to
take or fail to take any action with respect to Confidential Information that would result in any Company Information losing its
character or ceasing to qualify as Confidential Information or a Trade Secret. In the event that the Executive is required by law
to disclose any Company Information, the Executive will not make such disclosure unless (and then only to the extent that) the
Executive has been advised by the Company’s legal counsel that such disclosure is required by law and then only after prior
written notice is given to the Employer when the Executive becomes aware that such disclosure has been requested and is required
by law. This Section 5 will survive the termination of employment with respect to Confidential Information for so long as it remains
Confidential Information, but for no longer than three (3) years following termination of employment, and this Section 5 will
survive termination of employment with respect to Trade Secrets for so long as is permitted by the then-current Maryland Trade
Secrets Act.

 

5.3           Delivery
upon Request or Termination. Upon request by the Employer, and in any event upon termination of employment with the Employer,
the Executive will promptly deliver to the Employer all property belonging to the Employer, including without limitation, all Company
Information then in the Executive’s possession or control.

 

6.           NON-COMPETITION.
The Executive agrees that during the Term hereunder and, in the event of the Executive’s termination of employment for any
reason, during the period of one (1) year from and after the effective date of such termination, the Executive will not (except
on behalf of or with the prior written consent of the Employer), within the Area, either directly or indirectly, on the Executive’s
own behalf or in the service or on behalf of others, as a principal, partner, officer, director, manager, supervisor, administrator,
consultant, executive employee or in any other capacity which involves duties and responsibilities similar to those undertaken
for the Employer, engage in any business which is the same as or essentially the same as the Business of the Employer.

 

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7.          NON-SOLICITATION
OF CUSTOMERS. The Executive agrees that during the Term hereunder and, in the event
of the Executive’s termination of employment for any reason, during the period of one (1) year from and after the effective
date of such termination, the Executive will not (except on behalf of or with the prior written consent of the Employer), within
the Area, on the Executive’s own behalf or in the service or on behalf of others, solicit, divert or appropriate or attempt
to solicit, divert or appropriate, directly or by assisting others, any business from any of the Employer’s customers, including
actively sought prospective customers, with whom the Executive has or had material contact during the last two (2) years of
the Executive’s employment, for purposes of providing products or services that are competitive with those provided by the
Employer.

 

8.          NON-SOLICITATION
OF EMPLOYEES. The Executive agrees that during the Term hereunder and, in the event
of the Executive’s termination of employment for any reason, during the period of (1) year from and after the effective date
of such termination, the Executive will not, except for Executive’s Administrative Assistant, within the Area, on the Executive’s
own behalf or in the service or on behalf of others, solicit, recruit or hire away or attempt to solicit, recruit or hire away,
directly or by assisting others, any employee of the Employer, whether or not such employee is a full-time employee or a temporary
employee of the Employer and whether or not such employment is pursuant to written agreement and whether or not such employment
is for a determined period or is at will. 

 

9.          REMEDIES.
The Executive agrees that the covenants contained in Sections 5 through 9 of this Agreement are of the essence of this Agreement;
that each of the covenants is reasonable and necessary to protect the business, interests and properties of the Employer; and that
irreparable loss and damage will be suffered by the Employer should the Executive breach any of the covenants. Therefore, the Executive
agrees and consents that, in addition to all the remedies provided by law or in equity, the Employer will be entitled to a temporary
restraining order and temporary and permanent injunctions to prevent a breach or contemplated breach of any of the covenants. The
Employer and the Executive agree that all remedies available to the Employer or the Executive, as applicable, will be cumulative.

 

10.         SEVERABILITY.
The parties agree that each of the provisions included in this Agreement is separate, distinct and severable from the other provisions
of this Agreement and that the invalidity or unenforceability of any Agreement provision will not affect the validity or enforceability
of any other provision of this Agreement. Further, if any provision of this Agreement is ruled invalid or unenforceable by a court
of competent jurisdiction because of a conflict between the provision and any applicable law or public policy, the provision will
be redrawn to make the provision consistent with and valid and enforceable under the law or public policy.

 

11.         NO
SET-OFF BY THE EXECUTIVE. The existence of any claim, demand, action or cause of action
by the Executive against the Employer, or any Affiliate of the Employer, whether predicated upon this Agreement or otherwise, will
not constitute a defense to the enforcement by the Employer of any of its rights hereunder.

 

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12.         NOTICE.
All notices and other communications required or permitted under this Agreement will be in writing and, if mailed by prepaid first-class
mail or certified mail, return receipt requested, will be deemed to have been received on the earlier of the date shown on the
receipt or three (3) business days after the postmarked date thereof. In addition, notices hereunder may be delivered by hand,
facsimile transmission or overnight courier, in which event the notice will be deemed effective when delivered or transmitted.
All notices and other communications under this Agreement must be given to the parties hereto at the following addresses:

 

If to the Employer:

 

Howard Bank

 

6011 University Boulevard

Suite 370

Ellicott City, MD 21043

 

Attn: Chief Executive Officer, Lead
Independent Director and Governance

 Committee Chair

 

With copy to:

 

Frank C. Bonaventure,
Jr.

OBER | KALER

100 Light Street

Baltimore, Maryland
21202

 

If to the Executive:

Robert A. Altieri

2814 Shadow Roll Court

Glenwood, Maryland 21738

 

13.         ASSIGNMENT.
Neither party hereto may assign or delegate this Agreement or any of its rights and obligations hereunder without the written consent
of the other party hereto.

 

14.         WAIVER.
A waiver by the Employer of any breach of this Agreement by the Executive will not be effective unless in writing, and no waiver
will operate or be construed as a waiver of the same or another breach on a subsequent occasion.

 

15.         ARBITRATION.
Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, will be settled by binding arbitration
in accordance with the Commercial Arbitration Rules of the American Arbitration Association. The decision of the arbitration panel
will be final and binding on the parties, and judgment upon the award rendered by the arbitration panel may be entered by any court
having jurisdiction thereof.

 

    	12

    	 

    

 

16.         ATTORNEYS’
FEES. In the event that the parties have complied with this Agreement with respect
to arbitration of disputes and litigation ensues between the parties concerning the enforcement of an arbitration award and the
Executive must employ separate legal counsel, the Employer shall advance to the Executive, within thirty (30) days after receiving
copies of invoices submitted by Executive, any and all reasonable attorneys’ fees and expenses incurred with preparing, investigating
and litigating such action, proceeding or suit. The Executive must reimburse the Employer for any and all advances that exceed
the first $5,000 advanced to the Executive for such legal expenses only if and to the extent that a final decision by a court of
competent jurisdiction has determined that the Executive is not entitled to receive any amounts due or to enforce any of the rights
under this Agreement.

 

17.         APPLICABLE
LAW. This Agreement will be construed and enforced under and in accordance with the
laws of the State of Maryland. The parties agree that any appropriate state court located in Howard County, Maryland, will have
jurisdiction of any case or controversy arising under or in connection with this Agreement and will be a proper forum in which
to adjudicate such case or controversy. The parties consent to the jurisdiction of such courts.

 

18.         INTERPRETATION.
Words importing the singular form shall include the plural and vice versa. The terms “herein”, “hereunder”,
“hereby”, “hereto”, “hereof” and any similar terms refer to this Agreement. Any captions, titles
or headings preceding the text of any article, section or subsection herein are solely for convenience of reference and will not
constitute part of this Agreement or affect its meaning, construction or effect.

 

19.         ENTIRE
AGREEMENT. This Agreement embodies the entire and final agreement of the parties on
the subject matter stated in the Agreement. No amendment or modification of this Agreement will be valid or binding upon the Employer
or the Executive unless made in writing and signed by both parties. All prior understandings and agreements relating to the subject
matter of this Agreement are hereby expressly terminated.

 

20.         RIGHTS
OF THIRD PARTIES. Nothing herein expressed is intended to or will be construed to
confer upon or give to any person, firm or other entity, other than the parties hereto and their permitted assigns, any rights
or remedies under or by reason of this Agreement.

 

21.         SURVIVAL.
The obligations of the Executive pursuant to Sections 5, 6, 7, 8 and 9 will survive the termination of the employment of the Executive
hereunder for the period designated under each of those respective sections.

 

[Signature Page Follows]

 

    	13

    	 

    

 

IN WITNESS WHEREOF,
the Employer and the Executive have executed and delivered this Agreement as of the date first shown above.

 

	 	Employer:	 
	 	 	 
	 	HOWARD BANK	 
	 	 	 	 
	 	By:	/s/ Mary Ann Scully	 
	 	 	Mary Ann Scully	 
	 	 	Chief Executive Officer	 

 

	 	Executive:	 
	 	 	 
	 	/s/ Robert A. Altieri	 
	 	Robert A. Altieri	 

 

    	14THE SECURITIES REPRESENTED BY THIS DEBENTURE
AND THE STOCK REFERENCED HEREIN HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR UNDER THE OKLAHOMA SECURITIES ACT
OR ANY OTHER STATE SECURITIES LAW, AND SUCH SECURITIES MAY NOT BE OFFERED, RESOLD, ASSIGNED OR TRANSFERRED BY A PURCHASER THEREOF
WITHOUT BEING REGISTERED UNDER THE SECURITIES ACT OF 1933, THE OKLAHOMA SECURITIES ACT AND ANY OTHER APPLICABLE STATE SECURITIES
LAW OR UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE IN THE OPINION OF COUNSEL TO THE COMPANY. THIS IS A LIMITED OFFERING
TO BE MADE ONLY PURSUANT TO EXEMPTIONS PROVIDED BY THE SECURITIES ACT OF 1933 AND APPLICABLE STATE SECURITIES LAWS. NEITHER THE
SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE AGENCY HAS PASSED UPON THE VALUE OF THESE SECURITIES, APPROVED OR DISAPPROVED
THIS OFFERING OR PASSED UPON THE ADEQUACY OR ACCURACY OF ANY INFORMATION PROVIDED TO THE UNDERSIGNED. 

 

 

CONVERTIBLE DEBENTURE

 

 

	$15,000.00  	June 25, 2013

 

FOR VALUE RECEIVED, 3DIcon Corporation,
an Oklahoma corporation (the “Company”), promises to pay to the order of _________, whose address is
__________________________ (the “Holder”) the principal sum of Fifteen Thousand Six and 00/100 Dollars
($15,000.00) (the “Principal Amount”), together with interest thereon as set forth below, on or before the Maturity
Date, as defined below, at the Holder’s address or such other place as the Holder may designate in writing to the Company.
In accordance with the terms hereof, the Holder shall have the right, from time to time and subject to the terms of this Debenture,
to convert all or any part of the sums due for principal and interest (if any) under this Debenture to common stock of the Company.

 

1. Interest.
Provided that this Debenture is paid in full or on before the Maturity Date, no interest shall accrue on the unpaid balance of
the Principal Amount. In the event that this Debenture is not paid in full on or before the Maturity Date, interest shall accrue
on the unpaid outstanding balance of the Principal Amount of this Debenture from June 26, 2013, until paid, at the fixed rate of
ten percent (10%) per annum (the “Interest Rate”). In the event all or part of the Principal Amount of this
Debenture is converted at any time, interest shall accrue on said converted Principal Amount from June 26, 2013, until the Conversion
Date, defined below, at the Interest Rate and such interest shall be converted with the Principal Interest shall be calculated
on the basis of the actual number of days elapsed over a 360 day year.

 

    	 

    	 

    

2. Payment Provisions.

 

(a) Interest Payments.
Subject to the provisions in Section 1 of this Debenture, the Company shall pay to the Holder interest accrued to the date upon
which this Debenture is paid in full.

 

(b) Principal Payments.
On June 26, 2014 (the “Maturity Date”), the outstanding balance of the Principal Amount shall be due and payable
in full by the Company to the Holder. Not less than ten business days’ before any sum of principal is paid on this Debenture,
even if such payment is intended to be made on or after the Maturity Date, the Company shall give the Holder written or electronic
notice of such intended payment. At any time during the ten day period following the Holder’s receipt of the Company’s
notice of payment, the Holder may exercise its right to convert to Common Stock all or any part of the amount of the payment stated
in the notice under the terms of this Debenture. The Holder shall notify the Company in writing or electronically of its election
within said ten day period. In the event and to the extent that the Holder exercises his right to convert all or part of the Principal
Amount to stock, interest shall be calculated on the converted Principal Amount from the date of this Debenture, but only if such
interest is converted along with such Principal Amount.

 

(c) Prepayments;
Application of Payments. Subject to the Holder’s right to convert to common stock, the Company may at any time and from
time to time prepay all or any part of the outstanding balance of the Principal Amount, together with all of the interest due on
the amount to be prepaid, as evidenced by this Debenture, without penalty upon at least ten business days’ prior written
or electronic notice to the Holder. At any time during the ten day period following the Holder’s receipt of the Company’s
notice of prepayment, the Holder may exercise its right to convert to Common Stock all or any part of the principal amount of the
prepayment stated in the notice, along with the interest accrued thereon pursuant to Section 1 of this Debenture, under the terms
of this Debenture. The Holder shall notify the Company in writing or electronically of its election within said ten day period.
The Holder shall apply payments received from the Company on this Debenture first against the accrued interest, if any, to the
date of the payment and then against the outstanding balance of the Principal Amount.

 

3. Representations
and Warranties of Company. The Company hereby represents and warrants to the Holder that, the statements contained in the following
paragraphs of this Section 3 are all true and correct as of the date this Debenture is signed by the Company:

 

    	2

    	 

    

(a) Organization
and Standing. The Company is a corporation duly organized, validly existing and in good standing under the laws of the State
of Oklahoma and has all requisite corporate power and authority to carry on its business as now conducted.

 

(b) Corporate Authority.
The Company has all requisite legal and corporate authority to enter into, execute and deliver this Debenture. This Debenture will
be valid and binding obligations of the Company, enforceable in accordance with their terms, except as the same may be limited
by bankruptcy, insolvency, moratorium, and other laws of general application affecting the enforcement of creditors’ rights.

 

(c) Authorization.

 

(1) Corporate Action.
All corporate and legal action on the part of the Company, its officers, directors and shareholders necessary for the execution
and delivery of this Debenture and the issuance of the shares to be issued in the event of the conversion of this Debenture, and
the performance of Company’s obligations hereunder have been taken.

 

(2) Valid Issuance.
This Debenture and the shares of the Company’s Common Stock to be issued upon conversion of this Debenture (collectively,
the “Securities”), when issued in compliance with the provisions of this Debenture will be validly issued and
will be free of any liens or encumbrances; provided, however, that the Securities are subject to restrictions on transfer under
state or federal securities laws, and as may be required by future changes in such laws.

 

4. Representations
and Warranties By Holder. The Holder represents and warrants to the Company, as of the date of this Debenture, as follows:

 

(a) Investment
Intent Authority. This Debenture is executed and delivered to the Holder in reliance upon the Holder’s representation
to Company that: (i) the Holder is acquiring this Debenture and any Securities that may be acquired upon the conversion of this
Debenture, for investment for the Holder’s own account, not as nominee or agent, for investment and not with a view to, or
for resale in connection with, any distribution or public offering thereof within the meaning of the Securities Act of 1933, as
amended, (the “Securities Act”); and (ii) the Holder has the full right, power, authority and capacity to make
the loan evidenced by this Debenture.

 

(b) Securities
Not Registered. The Holder understands and acknowledges that the offering of the Securities represented by this Debenture and
the Warrant will not be registered under any federal or State securities laws or regulations.

 

5.
Conversion.

 

(a) Conversion at
Option of Holder. For as long as any sum of principal is outstanding on this Debenture, this Debenture shall be convertible
in whole or in any part into shares of the Company’s restricted Common Stock at the option of the Holder. The number of shares
of Common Stock issuable upon a conversion hereunder equals the quotient obtained by dividing (x) the outstanding principal amount
of this Debenture to be converted, along with interest calculated at the Interest Rate on said principal amount, by (y) the Conversion
Price (as defined in Section 5(d)(i)). The Company shall deliver Common Stock certificates to the Holder prior to the tenth (10th)
business day after each Conversion Date as defined below.

 

    	3

    	 

    

(b) Surrender Upon Payment.
Upon the payment in full of all amounts due on this Debenture or the conversion of the amount due under this Debenture into shares
of Common Stock, the Holder will surrender this Debenture.

 

(c) Conversion Procedure.The
Holder shall effect a conversion by delivering (by mail, delivery or email) to the Company a completed notice in the form attached
hereto as EXHIBIT A (a “Conversion Notice”). The date on which a Conversion Notice is delivered is the “Conversion
Date”. A conversion hereunder shall have the effect of paying that portion of the outstanding principal amount of this
Debenture noted on the Conversion Notice. The Holder and the Company shall maintain records showing the amounts converted and the
dates of such conversions.

 

(d) Conversion
Price and Adjustments to Conversion Price.

 

(1) The conversion
price is $.01 per share (the “Conversion Price”). The Conversion Price may be adjusted pursuant to the terms
of this Debenture.

 

(2) If the Company,
at any time while this Debenture is outstanding, shall (a) pay a stock dividend or otherwise make a distribution or distributions
on shares of its Common Stock or any other equity or equity equivalent securities payable in shares of Common Stock, (b) subdivide
outstanding shares of Common Stock into a larger number of shares, (c) combine (including by way of reverse stock split) outstanding
shares of Common Stock into a smaller number of shares, or (d) issue by reclassification of shares of the Common Stock any shares
of capital stock of the Company, then the Conversion Price shall be multiplied by a fraction of which the numerator shall be the
number of shares of Common Stock (excluding treasury shares, if any) outstanding before such event and of which the denominator
shall be the number of shares of Common Stock outstanding after such event. Any adjustment made pursuant to this Section shall
become effective immediately upon the latter of the following events: (i) the expiration of a period of ten days following written
notice to the Holder of such prospective adjustment; or (ii) the record date for the determination of stockholders entitled to
receive such dividend or distribution and shall become effective immediately after the effective date, in the case of a subdivision,
combination or re-classification.

 

(3) Whenever the Conversion
Price is adjusted pursuant to this Section, the Company shall promptly mail to the Holder a notice setting forth the Conversion
Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment.

 

    	4

    	 

    

(4) If (A) the
Company shall declare a dividend (or any other distribution) on the Common Stock; (B) the Company shall authorize the granting
to all holders of the Common Stock rights or warrants to subscribe for or purchase any shares of capital stock of any class or
of any rights; (C) the approval of any stockholders of the Company shall be required in connection with any reclassification of
the Common Stock, any consolidation or merger to which the Company is a party, any sale or transfer of all or substantially all
of the assets of the Company, of any compulsory share exchange whereby the Common Stock is converted into other securities, cash
or property; or (D) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs
of the Company; then, in each case, the Company shall cause to be filed at each office or agency maintained for the purpose of
conversion of this Debenture, and shall cause to be mailed to the Holder at its last address as it shall appear upon the stock
books of the Company, at least twenty (20) calendar days prior to the applicable record or effective date hereinafter specified,
a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights
or warrants, or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to
such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which such reclassification,
consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is
expected that holders of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities,
cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange, provided,
that the failure to mail such notice or any defect therein or in the mailing thereof shall not affect the validity of the corporate
action required to be specified in such notice. The Holder is entitled to convert this Debenture during the 20-day calendar period
commencing the date of such notice to the effective date of the event triggering such notice. The Holder shall not be entitled
to vote any shares into which this Debenture is convertible until the Conversion Date, and, in that instance, only if the Conversion
Date is on or before 8:00 a.m., Central, on the record date of any vote.

 

6. Assignment.
This Debenture and the obligations hereunder may not be assigned by the Company without the prior written consent of the Holder.

 

7. Default and Remedies.
The occurrence of an event of default under this Debenture shall entitle the Holder to exercise the rights and remedies of a creditor
under law or in equity.

 

8. Waivers.
The Company hereby waives presentment, demand, protest or further notice of any kind to the extent permitted by applicable law.

 

9. Controlling Law;
Jurisdiction; Attorneys’ Fees. This Debenture and all matters related hereto shall be governed, construed and interpreted
in accordance with the laws of the State of Oklahoma, without regard to its principles of conflicts of laws. In the event an action
is brought to enforce this Debenture, the action shall be brought in the federal or state courts sitting in Tulsa County, Oklahoma,
and the prevailing party in such action shall be entitled to recover a reasonable attorney’s fee and costs to be set by the
court from the other party.

 

10. Purpose of Loan.
The Company represents and warrants that this Debenture evidences its obligation to the Holder for monies loaned to the Company.

 

    	5

    	 

    

11. Waiver of Trial
by Jury. The Company and the Holder agree that any suit, action or proceeding, whether claim or counterclaim, brought or instituted
by the Company or the Holder on or with respect to this Debenture or any event, transaction or occurrence arising out of or in
any way connected therewith or dealing with the parties hereto, shall be tried only by a court and not by a jury. THE COMPANY
AND THE HOLDER HEREBY EXPRESSLY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY SUCH SUIT, ACTION OR PROCEEDING.

 

12. Severability.
In the event any one or more of the provisions contained in this Debenture shall for any reason be held to be invalid, illegal
or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision of this Debenture,
but this Debenture shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein or
therein. There are no promises or conditions to payment which are not expressly set forth herein.

 

13.Entire
Agreement; Amendment Provision. This Debenture contains the entire understanding and agreement of the parties in regard to
this loan and it supercedes and voids any previous agreements or understandings in regard to this loan. This Debenture may only
be amended by means of a written agreement which is signed by Borrower and Holder and which expressly states that it amends this
Debenture. The term “Debenture” and all reference thereto, as used throughout this instrument, shall mean this
instrument as originally executed, or if later amended or supplemented, then as so amended or supplemented, and any successor instrument
as it may be amended or supplemented.

 

 

IN WITNESS WHEREOF,
the undersigned have caused this Debenture to be executed on the day and year first above written.

 

	BORROWER:	 	HOLDER:	 
	 	 	 	 	 
	3DIcon Corporation 	 	 	 
	 	 	 	 	 
	By		 	 	 
	 	Mark Willner, CEO	 	 	 

    	6

    	 

    

  

 

exhibit
a

 

3DIcon
Corporation

 

CONVERSATION NOTICE

 

(To be executed by the Holder in order
to convert all or party of the $15,000.00 Convertible Debenture issued by 3DIcon Corporation, dated June 25, 2013 [the “Debenture”])

 

The undersigned hereby
irrevocably elects to convert $__________ of the outstanding principal amount of the above Debenture, into shares of Common Stock
of 3DIcon Corporation, according to the conditions stated therein, as of the conversion date written below.

 

	Conversion Date:	  
	 	 
	Principal Amount to be converted:	$    
	 	 
	Interest Amount to be converted:	 
	 	 
	Total Amount to be converted:	$    
	 	 
	Conversion Price:	$.01 / share
	 	 
	Number of shares of Common	 
	Stock to be issued:	 

 

Please issue the shares of Common Stock in the following
name and send the certificates to _____________________________________:

 

Issue to:

	Name	 	Shares
	 	 	 
	 	 	 

 

	Debenture Holder:	 
	 	 
	Authorized Signature:	 
	 	 
	Name:	 
	 	 
	Title:	 

 

    	7

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