Document:

Amended Employment Agreement

 EXHIBIT 10.01 
 AMENDED EMPLOYMENT AGREEMENT 
 This
AMENDED EMPLOYMENT AGREEMENT (this “Agreement”) is entered into effective as of this 22nd day of November, 2006, by and among Cape Fear Bank
Corporation, a North Carolina corporation formerly known as Bank of Wilmington Corporation (the “Corporation”), Cape Fear Bank, formerly known as Bank of Wilmington, a bank chartered under North Carolina law and a wholly
owned subsidiary of the Corporation (the “Bank”), and John Cameron Coburn, Chairman, President, and Chief Executive Officer of the Corporation and the Bank (the “Executive”). The Corporation and the
Bank are referred to in this Agreement individually and together as the “Employer.” 
 WHEREAS, the Executive is the Chairman, President, and Chief Executive Officer of the Corporation and the Bank, possessing unique skills, knowledge, and experience relating to their business, and the
Executive has made and is expected to continue to make major contributions to the profitability, growth, and financial strength of the Corporation and affiliates, 
 WHEREAS, the Executive and the Bank are parties to a June 23, 2005 Employment Agreement, 
 WHEREAS, the Executive and the Employer have agreed to certain amendments of the June 23, 2005 Employment Agreement, including amendments intended to assure compliance with
Internal Revenue Code section 409A, and the Executive and the Employer intend by this Agreement to restate the June 23, 2005 Employment Agreement in its entirety, incorporating into this Agreement the terms of the June 23, 2005 Employment
Agreement as amended hereby, and 
 WHEREAS, none of the conditions or events included in the definition
of the term “golden parachute payment” that is set forth in Section 18(k)(4)(A)(ii) of the Federal Deposit Insurance Act [12 U.S.C. 1828(k)(4)(A)(ii)] and in Federal Deposit Insurance Corporation Rule 359.1(f)(1)(ii) [12 CFR
359.1(f)(1)(ii)] exists or, to the best knowledge of the Employer, is contemplated insofar as the Corporation or any affiliates are concerned. 
 NOW THEREFORE, in consideration of these premises, the mutual covenants contained herein, and other good and valuable consideration the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows. 
 ARTICLE 1 
 EMPLOYMENT 
 1.1 EMPLOYMENT.
The Employer hereby employs the Executive to serve as President and Chief Executive Officer according to the terms and conditions of this Agreement and for the period stated in section 1.3. The Executive hereby accepts employment according to the
terms and conditions of this Agreement and for the period stated in section 1.3. 
 1.2 DUTIES. As
President and Chief Executive Officer, the Executive shall serve under the direction of the Employer’s board of directors and in accordance with the Employer’s 

 Articles of Incorporation and Bylaws, as each may be amended or restated from time to time. The Executive shall report
directly to the board of directors. The Executive shall serve the Employer faithfully, diligently, competently, and to the best of the Executive’s ability. The Executive shall exclusively devote the Executive’s full working time, energy,
and attention to the business of the Employer and to the promotion of the Employer’s interests throughout the term of this Agreement. Without the written consent of the board of directors of each of the Corporation and the Bank, during the term
of this Agreement the Executive shall not render services to or for any person, firm, corporation, or other entity or organization in exchange for compensation, regardless of the form in which the compensation is paid and regardless of whether it is
paid directly or indirectly to the Executive. Nothing in this section 1.2 shall prevent the Executive from managing personal investments and affairs, provided that doing so does not interfere with the proper performance of the Executive’s
duties and responsibilities as President and Chief Executive Officer. 
 1.3 TERM. The initial term of
employment under this Agreement shall be three years, commencing January 1, 2005. On the first anniversary of the January 1, 2005 effective date of this Agreement and on each anniversary thereafter, the term of this Agreement shall
automatically be extended for one additional year unless the Bank’s board of directors determines that the term shall not be extended. If the board of directors decides not to extend the term, the board shall promptly notify the Executive in
writing, but this Agreement shall nevertheless remain in force until its current term expires. The board’s decision not to extend the term shall not – by itself – give the Executive any rights under this Agreement to claim an adverse
change in his position, compensation, or circumstances or otherwise to claim entitlement to severance benefits under Articles 4 or 5. References herein to the term of this Agreement mean the initial term, as the same may be extended. Unless sooner
terminated, the Executive’s employment and the term of this Agreement shall terminate when the Executive attains age 55. 
 1.4
SERVICE ON THE BOARD OF DIRECTORS. The Executive is currently serving as a director of each of the Corporation and the Bank. The Corporation
shall nominate the Executive for election as a director at such times as necessary so that the Executive will, if elected by stockholders, remain a director of the Corporation throughout the term of this Agreement. The Executive hereby consents to
serving as a director and to being named as a director of the Corporation in documents filed with the Securities and Exchange Commission. The board of directors of each of the Corporation and the Bank shall undertake every lawful effort to ensure
that the Executive continues throughout the term of his employment to be elected or reelected as a director of the Bank. The Executive shall be deemed to have resigned as a director of each of the Corporation and the Bank effective immediately after
termination of the Executive’s employment under Article 3 of this Agreement, regardless of whether the Executive submits a formal, written resignation as director. 
 ARTICLE 2 
 COMPENSATION AND BENEFITS

 2.1 BASE SALARY. In consideration of the Executive’s performance of the
Executive’s obligations under this Agreement, the Employer shall pay or cause to be paid to the Executive a salary at the annual rate of not less than $200,000, payable in bi-weekly installments or otherwise according to the Employer’s
regular pay practices. The Executive’s salary shall be reviewed annually by the Employer’s board of directors or by such board committee as has jurisdiction over executive compensation. The Executive’s salary shall be increased no
more 
  

 2 

 frequently than annually to account for cost of living increases. At the discretion of the committee having jurisdiction
over executive compensation, the Executive’s salary also may be increased beyond the amount necessary to account for cost of living increases. However, the Executive’s salary shall not be reduced. All compensation under this Agreement
shall be subject to customary withholding taxes and such other employment taxes as are imposed by law. The Executive’s salary, as the same may be increased from time to time, is referred to in this Agreement as the “Base
Salary.” 
 2.2 BENEFIT PLANS AND PERQUISITES.
The Executive shall be entitled throughout the term of this Agreement to participate in any and all officer or employee compensation, bonus, incentive, and benefit plans in effect from time to time, including without limitation plans providing
pension, retirement, medical, dental, disability, and group life benefits, and to receive any and all other fringe benefits provided from time to time, provided that the Executive satisfies the eligibility requirements for any such plans or
benefits. Without limiting the generality of the foregoing – 
 (a) Participation in Stock Plans. The Executive shall be eligible
to participate in any stock-based compensation, incentive, bonus, or purchase plans existing on the date of this Agreement or adopted during the term of this Agreement. 
 (b) Club Dues. During the term of this Agreement, the Employer shall pay or cause to be paid the Executive’s membership assessments and dues in civic and social clubs located in New Hanover County, North
Carolina and that are mutually agreeable to the Executive and the board of directors. The Executive shall be solely responsible for personal expenses for use of the civic and social clubs. 
 (c) Reimbursement of Business Expenses. The Executive shall be entitled to reimbursement for all reasonable business expenses incurred performing
the obligations under this Agreement, including but not limited to all reasonable business travel and entertainment expenses incurred while acting at the request of or in the service of the Employer and reasonable expenses for attendance at annual
and other periodic meetings of trade associations. 
 (d) Reimbursement for Personal Disability Coverage. The Employer shall reimburse
the Executive for the cost of the Executive’s purchase and maintenance of disability insurance coverage on the Executive during the term of this Agreement, provided that the policy shall provide for an annual disability benefit not exceeding
$96,000 and an elimination period of no fewer than six months. The disability insurance policy purchased by the Executive shall be held by the Executive individually. 
 (e) Medical Insurance Coverage. The Employer shall provide the Executive with major medical insurance coverage at no cost to the Executive, which coverage shall be at least equivalent to the major medical
insurance coverage generally provided to active full-time employees from time to time. 
 2.3 VACATION.
The Executive shall be entitled to sick leave and at least five weeks of paid annual vacation in accordance with the policies established from time to time by the Employer. The Executive shall be entitled to accumulate unused sick leave from one
year to the next. Vacation days not used in a given year may be carried over from one calendar year to the 
  

 3 

 next. Executive may participate in any plan offered by the Employer to employees generally to purchase unused vacation
days and/or unused sick leave. 
 2.4 INDEMNIFICATION AND INSURANCE.
(a) Indemnification. The Employer shall indemnify the Executive or cause the Executive to be indemnified for the Executive’s activities as a director, officer, employee, or agent of the Employer or as a person who is serving or has
served at the request of the Employer (a “representative”) as a director, officer, employee, agent, or trustee of an affiliated corporation, joint venture trust or other enterprise, domestic or foreign, in which the Employer
has a direct or indirect ownership interest against expenses (including without limitation attorneys’ fees, judgments, fines, and amounts paid in settlement) actually and reasonably incurred (“Expenses”) in connection
with any claim against the Executive that is the subject of any threatened, pending, or completed action, suit, or other type of proceeding, whether civil, criminal, administrative, investigative, or otherwise and whether formal or informal (a
“Proceeding”), to which the Executive was, is, or is threatened to be made a party by reason of the Executive being or having been such a director, officer, employee, agent, or representative. 
 The indemnification provided herein shall not be exclusive of any other indemnification or right to which the Executive may be entitled and shall
continue after the Executive has ceased to occupy a position as an officer, director, employee, agent or representative with respect to Proceedings relating to or arising out of the Executive’s acts or omissions during the Executive’s
service in such position. The benefits provided to the Executive under this Agreement for the Executive’s service as a representative shall be payable if and only if and only to the extent that reimbursement to the Executive by the affiliated
entity with which the Executive has served as a representative, whether pursuant to agreement, applicable law, articles of incorporation or association, by-laws or regulations of the entity, or insurance maintained by such affiliated entity, is
insufficient to compensate the Executive for Expenses actually incurred and otherwise payable by the Employer under this Agreement. Any payments in fact made to or on behalf of the Executive directly or indirectly by the affiliated entity with which
the Executive served as a representative shall reduce the obligation of the Employer hereunder. 
 (b) Exclusions. Anything herein to
the contrary notwithstanding, however, nothing in this section 2.4 requires indemnification, reimbursement, or payment by the Employer, and the Executive shall not be entitled to demand indemnification, reimbursement or payment – 
 1) if and to the extent indemnification, reimbursement, or payment constitutes a “prohibited indemnification payment” within the
meaning of Federal Deposit Insurance Corporation Rule 359.1(l)(1) [12 CFR 359.1(l)(1)], or 
 2) for any claim or any part
thereof for which the Executive shall have been determined by a court of competent jurisdiction, from which no appeal is or can be taken, by clear and convincing evidence, to have acted with deliberate intent to cause injury to the Employer or with
reckless disregard for the best interests of the Employer, or 
 3) for any claim or any part thereof arising under section
16(b) of the Securities Exchange Act of 1934 as a result of which the Executive is required to pay any penalty, fine, settlement, or judgment, or 
  

 4 

 4) for any obligation of the Executive based upon or attributable to the Executive
gaining in fact any personal gain, profit, or advantage to which the Executive was not entitled, or 
 5) any proceeding
initiated by the Executive without the consent or authorization of the Employer’s board of directors, but this exclusion shall not apply with respect to any claims brought by the Executive (x) to enforce the Executive’s rights
under this Agreement, or (y) in any Proceeding initiated by another person or entity whether or not such claims were brought by the Executive against a person or entity who was otherwise a party to such proceeding. 
 (c) Insurance. The Employer shall maintain or cause to be maintained liability insurance covering the Executive throughout the term of this
Agreement. 
 ARTICLE 3 
 EMPLOYMENT TERMINATION 
 3.1 TERMINATION
BY THE EMPLOYER. (a) Death or Disability. The Executive’s employment shall terminate automatically on the date of the Executive’s death. If the Executive dies in
active service to the Employer, for twelve months after the Executive’s death the Employer shall assist the Executive’s family with continuing health care coverage under COBRA substantially identical to that provided for the Executive
before death. 
 By delivery of written notice 30 days in advance to the Executive, the Employer may terminate the Executive’s
employment if the Executive is disabled. For purposes of this Agreement, the Executive shall be considered “disabled” if an independent physician selected by the Employer and reasonably acceptable to the Executive or the
Executive’s legal representative determines that, because of illness or accident, the Executive is unable to perform the Executive’s duties and will be unable to perform the Executive’s duties for a period of 90 consecutive days. The
Executive shall not be considered disabled, however, if the Executive returns to work on a full-time basis within 30 days after the Employer gives notice of termination due to disability. 
 (b) Termination Without Cause. With written notice to the Executive 60 days in advance, the Employer may terminate the Executive’s employment
without Cause. 
 (c) Termination with Cause. The Employer may terminate the Executive’s employment with Cause. The Executive
shall not be deemed to have been terminated for Cause under this Agreement unless and until there is delivered to the Executive a copy of a resolution duly adopted at a meeting of the board of directors called and held for such purpose, which
resolution shall (x) contain findings that, in the good faith opinion of the board, the Executive has committed an act constituting Cause, and (y) specify the particulars thereof. The resolution of the board of directors
shall be deemed to have been duly adopted if and only if it is adopted by the affirmative vote of a majority of the directors of the Employer then in office, excluding the Executive, at a meeting duly called and held for that purpose. Notice of the
meeting and the proposed termination for Cause shall be given to the Executive a reasonable amount of time before the board’s meeting. The Executive and the Executive’s counsel (if the Executive chooses to have counsel present) shall have
a reasonable opportunity to be heard by the board at 
  

 5 

 the meeting. Nothing in this Agreement limits the Executive’s or the Executive’s beneficiaries’ right to
contest the validity or propriety of the board’s determination of Cause. 
 (d) Definition of Cause. For purposes of this
Agreement, “Cause” means any of the following – 
 1) an act of fraud, embezzlement, or theft by
the Executive in the course of employment, or 
 2) intentional violation of any law or significant policy of the Employer or
an affiliate, which in the Employer’s sole judgement causes material harm to the Employer or affiliate, regardless of whether the violation leads to criminal prosecution or conviction. For purposes of this Agreement, applicable laws include any
statute, rule, regulatory order, statement of policy, or final cease-and-desist order of any governmental agency or body having regulatory authority over the Employer, or 
 3) the Executive’s gross negligence or gross neglect of duties in the performance of duties, or 
 4) intentional wrongful damage by the Executive to the business or property of the Employer or its affiliates, including without
limitation the reputation of the Employer, which in the Employer’s sole judgment causes material harm to the Employer. For purposes of this Agreement, no act or failure to act on the part of the Executive shall be deemed to have been
intentional if it was due primarily to an error in judgment or negligence. An act or failure to act on the Executive’s part shall be considered intentional if it is not in good faith and if it is without a reasonable belief that the action or
failure to act is in the best interests of the Employer, or 
 5) a breach by the Executive of fiduciary duties as an officer
or director of the Employer or misconduct involving dishonesty, in either case whether in the Executive’s capacity as an officer or as a director of the Employer, or 
 6) a breach by the Executive of this Agreement that in the sole judgment of the Employer is a material breach, which breach is not
corrected by the Executive within 10 days after receiving written notice of the breach, or 
 7) removal of the Executive from
office or permanent prohibition of the Executive from participating in the Employer’s affairs by an order issued under section 8(e)(4) or (g)(1) of the Federal Deposit Insurance Act, 12 U.S.C. 1818(e)(4) or (g)(1), or 
 8) the occurrence of any event that results in the Executive being excluded from coverage, or having coverage limited for the Executive as
compared to other executives of the Employer, under the Employer’s blanket bond or other fidelity or insurance policy covering its directors, officers, or employees, or 
 9) conviction of the Executive for or plea of no contest to a felony or conviction of or plea of no contest to a misdemeanor involving
moral turpitude, or the actual incarceration of the Executive for seven consecutive days or more. 
  

 6 

 3.2 TERMINATION BY THE
EXECUTIVE. The Executive may terminate employment with written notice to the Bank 60 days in advance, whether with or without Good Reason. If the Executive terminates with Good Reason, the termination will take
effect at the conclusion of the 60-day period unless the event or circumstance constituting Good Reason is cured by the Employer or unless the notice of termination for Good Reason is revoked by the Executive within the 60-day period. For purposes
of this Agreement, “Good Reason” means any of the following events occur without the Executive’s written consent – 
 (a) Reduced Base Salary: reduction of the Executive’s Base Salary, 
 (b) Participation in Benefit Plans Reduced or
Terminated: reduction of the Executive’s bonus, incentive, and other compensation award opportunities under the Employer’s benefit plans, unless a company-wide reduction of all officers’ award opportunities occurs simultaneously,
or termination of the Executive’s participation in any officer or employee benefit plan maintained by the Employer, unless the plan is terminated because of changes in law or loss of tax deductibility to the Employer for contributions to the
plan, or unless the plan is terminated as a matter of Employer policy applied equally to all participants in the plan, 
 (c) Reduced
Responsibilities or Status: 
 1) assignment to the Executive of duties that are materially inconsistent with the
Executive’s position as the Employer’s principal executive officer or that represent a reduction of authority, 
 2)
failure to appoint or reappoint the Executive as President and Chief Executive Officer of the Employer, or 
 3) failure to
nominate the Executive as a director of the Corporation for election by stockholders, or failure to elect or reelect the Executive or cause the Executive to be elected or reelected to the board of directors of the Bank in accordance with section 1.4
of this Agreement, 
 (d) Failure to Obtain Assumption Agreement: failure to obtain an assumption of the Employer’s obligations
under this Agreement by any successor to the Employer, regardless of whether such entity becomes a successor as a result of a merger, consolidation, sale of assets, or other form of reorganization, 
 (e) Material Breach: a material breach of this Agreement by the Employer that is not corrected within a reasonable time, or 
 (f) Relocation of the Executive: relocation of the Employer’s principal executive offices, or requiring the Executive to change the
Executive’s principal work location, to any location that is more than 15 miles from the location of the Employer’s principal executive offices on the date of this Agreement. 
 3.3 NOTICE. Any purported termination by the Employer or by the Executive shall be communicated by written notice of
termination to the other. The notice must state the specific termination provision of this Agreement relied upon. The notice must also state the date on which termination shall become effective, which shall be a date not earlier than the date of the

  

 7 

 termination notice. If termination is for Cause or with Good Reason, the notice must state in reasonable detail the facts
and circumstances forming the basis for termination of the Executive’s employment. 
 ARTICLE 4 
 COMPENSATION AND BENEFITS AFTER TERMINATION 
 4.1 CAUSE. If the Executive’s employment terminates for Cause, the Executive shall receive the salary to which
the Executive was entitled through the date on which termination became effective and any other benefits to which the Executive may be entitled under the Employer’s benefit plans and policies in effect on the date of termination. 
 4.2 TERMINATION BY THE EXECUTIVE OTHER THAN
FOR GOOD REASON. If the Executive terminates employment other than for Good Reason, the Executive shall receive the salary to which the Executive is entitled through the date on which
termination becomes effective and any other benefits to which the Executive may be entitled under the Employer’s benefit plans and policies. 
 4.3 TERMINATION BECAUSE OF DISABILITY. If the Executive’s employment terminates because of disability, the Executive shall receive the salary earned
through the date on which termination became effective, any unpaid bonus or incentive compensation due to the Executive for the calendar year preceding the calendar year in which the termination became effective, any payments the Executive is
eligible to receive under any disability insurance program in which the Executive participates, such other benefits to which the Executive may be entitled under the Employer’s benefit plans, policies, and agreements, and any benefits provided
for elsewhere in this Agreement. 
 4.4 TERMINATION WITHOUT CAUSE AND
TERMINATION FOR GOOD REASON. (a) Subject to the possibility that continued Base Salary for the first six months after employment termination might be delayed because
of section 4.4(b), if the Executive’s employment terminates involuntarily but without Cause or if the Executive voluntarily terminates employment for Good Reason, the Executive shall continue to receive the Base Salary for the unexpired term of
this Agreement, but the Executive shall not be entitled to continued participation in the Employer’s or a subsidiary’s retirement plan(s) or any stock-based plans. The Employer and the Executive acknowledge and agree that the compensation
and benefits under this section 4.4 shall not be payable if compensation and benefits are payable or shall have been previously paid to the Executive under Article 5 of this Agreement. 
 (b) If when employment termination occurs the Executive is a specified employee within the meaning of section 409A of the Internal Revenue Code of 1986,
and if continued Base Salary under section 4.4(a) would be considered deferred compensation under section 409A, and finally if an exemption from the six-month delay requirement of section 409A(a)(2)(B)(i) is not available, the Executive’s
continued Base Salary under section 4.4(a) for the first six months after employment termination shall be paid to the Executive in a single lump sum on the first day of the seventh month after the month in which the Executive’s employment
terminates. References in this Agreement to section 409A of the Internal Revenue Code of 1986 include rules, regulations, and guidance of general application issued by the Department of the Treasury under Internal Revenue Code section 409A.

  

 8 

 4.5 POST-TERMINATION LIFE AND
MEDICAL COVERAGE. (a) Subject to the Employer’s right to elect to make an alternative cash payment under section 4.5(b), if the Executive’s employment terminates involuntarily but
without Cause, or voluntarily but with Good Reason, or because of disability, the Employer shall continue or cause to be continued at the Employer’s expense life and medical insurance benefits in effect during the two years preceding the date
of the Executive’s termination. The benefits provided by this section 4.5 shall continue until the first to occur of (w) the Executive’s return to employment with the Employer or another employer, (x) the
Executive’s attainment of age 55, (y) the Executive’s death, or (z) the end of the term remaining under this Agreement when the Executive’s employment terminates. 
 (b) Instead of providing continued life and medical insurance coverage for the Executive, the Employer may elect to pay to the Executive in a single lump
sum an amount in cash equal to the present value of the Employer’s projected cost to maintain the Executive’s life and medical coverage had the Executive’s employment not terminated, assuming continued coverage for the lesser of 36
months or the number of months until the Executive attains age 55, (x) if under the terms of the life and medical policy coverage maintained by the Employer it is not possible to continue the Executive’s coverage or
(y) if the Employer determines that continued coverage would be considered deferred compensation under section 409A of the Internal Revenue Code of 1986. The lump-sum payment shall be made within 30 days after employment termination or,
if section 4.4(b) applies, on the first day of the seventh month after the month in which the Executive’s employment terminates. 
 4.6 SALARY CONTINUATION AGREEMENT. The Bank and the Executive have entered into a Salary Continuation Agreement dated as of June 23, 2005. Unless the Salary
Continuation Agreement explicitly provides otherwise, whether benefits are properly payable to the Executive under the Salary Continuation Agreement shall be determined solely by reference to that agreement, as the same may be amended. 

ARTICLE 5 
 CHANGE IN CONTROL BENEFITS 
 5.1 CHANGE
IN CONTROL BENEFITS. (a) If a Change in Control occurs during the term of this Agreement, the Employer shall make or cause to be made a lump-sum payment to the Executive in an
amount in cash equal to three times the Executive’s annual compensation. For this purpose, annual compensation means (x) the Executive’s Base Salary at the time of the Change in Control plus (y) any bonuses or
incentive compensation earned for the calendar year ended immediately before the year in which the Change in Control occurs, regardless of when the bonus or incentive compensation earned for the preceding calendar year is paid and regardless of
whether all or part of the bonus or incentive compensation is subject to elective deferral. Annual compensation shall be calculated without regard to any deferrals under qualified or nonqualified plans, but annual compensation shall not include
interest or other earnings credited to the Executive under qualified or nonqualified plans. The amount payable to the Executive hereunder shall not be reduced to account for the time value of money or discounted to present value. The payment
required under this paragraph (a) is payable no later than five business days after the Change in Control occurs. If the Executive receives payment under section 5.1 the Executive shall not be entitled to any additional severance benefits under
section 4.4 of this Agreement. The Executive shall be entitled to benefits under this paragraph (a) on no more than one occasion. 
  

 9 

 (b) Benefit Plans: In addition to life and medical insurance benefits under section 4.5 of this
Agreement and any benefits to which the Executive may be entitled under the Salary Continuation Agreement referred to in section 4.6 of this Agreement, the Employer shall (x) cause the Executive to become fully vested in any qualified
and non-qualified plans, programs, or arrangements in which the Executive participated if the plan, program, or arrangement does not address the effect of a change in control, and (y) contribute or cause to be contributed to the
Executive’s 401(k) plan account, if any, the matching and profit-sharing contributions, if any, that the Executive is entitled to based upon all W-2 income earned by the Executive for the plan year. 
 5.2 CHANGE IN CONTROL DEFINED. For purposes of this Agreement,
“Change in Control” means any one of the following events occurs, provided the event constitutes a change in control within the meaning of Internal Revenue Code section 409A and rules, regulations, and guidance of general
application thereunder issued by the Department of the Treasury, and provided the occurrence of the event is objectively determinable and does not require the exercise of judgment or discretion on the part of the Plan Administrator or any other
person – 
 (a) Change in Ownership: a change in ownership of the Corporation occurs on the date any one person or
group accumulates ownership of the Corporation’s stock constituting more than 50% of the total fair market value or total voting power of the Corporation’s stock, 
 (b) Change in Effective Control: (x) any one person, or more than one person acting as a group, acquires within a
12-month period ownership of stock of the Corporation possessing 35% or more of the total voting power of the Corporation’s stock, or (y) a majority of the Corporation’s board of directors is replaced during any 12-month period
by directors whose appointment or election is not endorsed in advance by a majority of the Corporation’s board of directors, or 
 (c) Change in Ownership of a Substantial Portion of Assets: a change in the ownership of a substantial portion of the Corporation’s assets occurs on the date any one person, or more than one person acting as a group, acquires
assets from the Corporation having a total gross fair market value equal to or exceeding 40% of the total gross fair market value of all of the assets of the Corporation immediately before the acquisition or acquisitions. For this purpose, gross
fair market value means the value of the Corporation’s assets, or the value of the assets being disposed of, determined without regard to any liabilities associated with the assets. 
 For purposes of paragraphs (a) through (c) of this section 5.2, persons shall be considered to be acting as a group if they would be considered
to be acting as a group under Internal Revenue Code section 409A and rules, regulations, and guidance of general application issued thereunder by the Department of the Treasury. 
 5.3 GROSS-UP FOR TAXES. (a) Additional Payment to Account for
Excise Taxes. If the Executive receives the lump sum payment under section 5.1 of this Agreement and acceleration of benefits under any other benefit, compensation, or incentive plan or arrangement with the Employer (collectively, the
“Total Benefits”), and if any part of the Total Benefits is subject to the Excise Tax under section 280G and section 4999 of the Internal Revenue Code (the 
  

 10 

 “Excise Tax”), the Employer shall pay or cause to be paid to the Executive the following
additional amounts, consisting of (x) a payment equal to the Excise Tax payable by the Executive under section 4999 on the Total Benefits (the “Excise Tax Payment”) and (y) a payment equal to the
amount necessary to provide the Excise Tax Payment net of all income, payroll, and excise taxes. Together, the additional amounts described in clauses (x) and (y) are referred to in this Agreement as the “Gross-Up
Payment Amount.” Payment of the Gross-Up Payment Amount shall be made in addition to the amount set forth in section 5.1. 
 Calculating the Excise Tax. For purposes of determining whether any of the Total Benefits will be subject to the Excise Tax and for purposes of determining the amount of the Excise Tax, 
 (1) Determination of “Parachute Payments” Subject to the Excise Tax: any other payments or benefits received or to be
received by the Executive in connection with a Change in Control or the Executive’s termination of employment (whether under the terms of this Agreement or any other agreement or any other benefit plan or arrangement with the Employer, any
person whose actions result in a Change in Control, or any person affiliated with the Employer or such person) shall be treated as “parachute payments” within the meaning of section 280G(b)(2) of the Internal Revenue Code,
and all “excess parachute payments” within the meaning of section 280G(b)(1) shall be treated as subject to the Excise Tax, unless in the opinion of the certified public accounting firm that is retained by the Employer as of
the date immediately before the Change in Control (the “Accounting Firm”) such other payments or benefits do not constitute (in whole or in part) parachute payments, or such excess parachute payments represent (in whole or in
part) reasonable compensation for services actually rendered within the meaning of section 280G(b)(4) of the Internal Revenue Code in excess of the “base amount” (as defined in section 280G(b)(3) of the Internal Revenue Code), or are
otherwise not subject to the Excise Tax, 
 (2) Calculation of Benefits Subject to Excise Tax: the amount of the Total
Benefits that shall be treated as subject to the Excise Tax shall be equal to the lesser of (x) the total amount of the Total Benefits reduced by the amount of such Total Benefits that in the opinion of the Accounting Firm are not
parachute payments, or (y) the amount of excess parachute payments within the meaning of section 280G(b)(1) (after applying clause (1), above), and 
 (3) Value of Noncash Benefits and Deferred Payments: the value of any noncash benefits or any deferred payment or benefit shall be
determined by the Accounting Firm in accordance with the principles of sections 280G(d)(3) and (4) of the Internal Revenue Code. 
 Assumed Marginal Income Tax Rate. For purposes of determining the Gross-Up Payment Amount, the Executive shall be deemed to pay federal income taxes at the highest marginal rate of federal income taxation in the calendar years in
which the Gross-Up Payment Amount is to be made and state and local income taxes at the highest marginal rate of taxation in the state and locality of the Executive’s residence on the date of the Change in Control or termination of employment,
net of the reduction in federal income taxes that can be obtained from deduction of such state and local taxes (calculated by assuming that any reduction under section 68 of the Internal Revenue Code in the amount of itemized deductions allowable to
the Executive applies 
  

 11 

 first to reduce the amount of such state and local income taxes that would otherwise be deductible by the Executive, and
applicable federal FICA and Medicare withholding taxes). 
 Return of Reduced Excise Tax Payment or Payment of Additional Excise Tax.
If the Excise Tax is later determined to be less than the amount taken into account hereunder when the Change in Control occurred or when the Executive’s employment terminated, the Executive shall repay to the Employer – when the amount of
the reduction in Excise Tax is finally determined – the portion of the Gross-Up Payment Amount attributable to the reduction (plus that portion of the Gross-Up Payment Amount attributable to the Excise Tax, federal, state and local income taxes
and FICA and Medicare withholding taxes imposed on the Gross-Up Payment Amount being repaid by the Executive to the extent that the repayment results in a reduction in Excise Tax, FICA and Medicare withholding taxes and/or a federal, state or local
income tax deduction). 
 If the Excise Tax is later determined to be more than the amount taken into account hereunder when the Change in
Control occurred or when the Executive’s employment terminated (due, for example, to a payment whose existence or amount cannot be determined at the time of the Gross-Up Payment Amount), the Employer shall make an additional payment to the
Executive for that excess (plus any interest, penalties or additions payable by the Executive for the excess) when the amount of the excess is finally determined. 
 (b) Responsibilities of the Accounting Firm and The Bank. Determinations Shall Be Made by the Accounting Firm. Subject to the provisions of section 5.3(a), all determinations required to be made under
this section 5.3(b) – including whether and when a Gross-Up Payment Amount is required, the amount of the Gross-Up Payment Amount and the assumptions to be used to arrive at the determination (collectively, the
“Determination”) – shall be made by the Accounting Firm, which shall provide detailed supporting calculations both to the Employer and the Executive within 15 business days after receipt of notice from the Employer or
the Executive that there has been a Gross-Up Payment Amount, or such earlier time as is requested by the Employer. 
 Fees and Expenses of
the Accounting Firm and Agreement with the Accounting Firm. All fees and expenses of the Accounting Firm shall be borne solely by the Employer. The Employer shall enter into any agreement requested by the Accounting Firm in connection with the
performance of its services hereunder. 
 Accounting Firm’s Opinion. If the Accounting Firm determines that no Excise Tax is
payable by the Executive, the Accounting Firm shall furnish the Executive with a written opinion to that effect, and to the effect that failure to report Excise Tax, if any, on the Executive’s applicable federal income tax return will not
result in the imposition of a negligence or similar penalty. 
 Accounting Firm’s Determination Is Binding; Underpayment and
Overpayment. The Determination by the Accounting Firm shall be binding on the Employer and the Executive. Because of the uncertainty in determining whether any of the Total Benefits will be subject to the Excise Tax at the time of the
Determination, it is possible that a Gross-Up Payment Amount that should have been made will not have been made by the Employer (“Underpayment”), or that a Gross-Up Payment Amount will be made that should not have been made
by the Employer (“Overpayment”). If, after a Determination by the Accounting Firm, the Executive is required to make a payment of additional Excise Tax, the Accounting Firm shall determine the amount of 
  

 12 

 the Underpayment that has occurred. The Underpayment (together with interest at the rate provided in section
1274(d)(2)(B) of the Internal Revenue Code) shall be paid promptly by the Employer to or for the benefit of the Executive. If the Gross-Up Payment Amount exceeds the amount necessary to reimburse the Executive for his Excise Tax according to section
5.3(a), the Accounting Firm shall determine the amount of the Overpayment that has been made. The Overpayment (together with interest at the rate provided in section 1274(d)(2)(B) of the Internal Revenue Code) shall be paid promptly by the Executive
to or for the benefit of the Employer. Provided that the Executive’s expenses are reimbursed by the Employer, the Executive shall cooperate with any reasonable requests by the Employer in any contests or disputes with the Internal Revenue
Service relating to the Excise Tax. 
 Accounting Firm Conflict of Interest. If the Accounting Firm is serving as accountant or
auditor for the individual, entity, or group effecting the Change in Control, the Executive may appoint another nationally recognized public accounting firm to make the Determinations required hereunder (in which case the term “Accounting
Firm” as used in this Agreement shall be deemed to refer to the accounting firm appointed by the Executive under this paragraph). 
 ARTICLE 6 
 CONFIDENTIALITY AND CREATIVE WORK

 6.1 NON-DISCLOSURE. The Executive covenants and agrees not to reveal to any
person, firm, or corporation any confidential information of any nature concerning the Employer or its business, or anything connected therewith. As used in this Article 6, the term “confidential information” means all of the
Employer’s and the Employer’s affiliates’ confidential and proprietary information and trade secrets in existence on the date hereof or existing at any time during the term of this Agreement, including but not limited to –

 (a) the whole or any portion or phase of any business plans, financial information, purchasing data, supplier data,
accounting data, or other financial information, 
 (b) the whole or any portion or phase of any research and development
information, design procedures, algorithms or processes, or other technical information, 
 (c) the whole or any portion or
phase of any marketing or sales information, sales records, customer lists, prices, sales projections, or other sales information, and 
 (d) trade secrets, as defined from time to time by the laws of the State of North Carolina. 
 Notwithstanding the foregoing,
confidential information excludes information that – as of the date hereof or at any time after the date hereof – is published or disseminated without obligation of confidence or that becomes a part of the public domain (x) by
or through action of the Employer, or (y) otherwise than by or at the direction of the Executive. This section 6.1 does not prohibit disclosure required by an order of a court having jurisdiction or a subpoena from an appropriate
governmental agency or disclosure made by the Executive in the ordinary course of business and within the scope of his authority. 
 6.2
RETURN OF MATERIALS. The Executive agrees to deliver or return to the Employer upon termination, upon expiration of this Agreement, or as soon thereafter as possible, 
  

 13 

 all written information and any other similar items furnished by the Employer or prepared by the Executive in connection
with his services hereunder. The Executive will retain no copies thereof after termination of this Agreement or termination of the Executive’s employment. 
 6.3 CREATIVE WORK. The Executive agrees that all creative work and work product, including but not limited to all technology, business management tools, processes,
software, patents, trademarks, and copyrights developed by the Executive during the term of this Agreement, regardless of when or where such work or work product was produced, constitutes work made for hire, all rights of which are owned by the
Employer. The Executive hereby assigns to the Employer all rights, title, and interest, whether by way of copyrights, trade secret, trademark, patent, or otherwise, in all such work or work product, regardless of whether the same is subject to
protection by patent, trademark, or copyright laws. 
 6.4 AFFILIATES’ CONFIDENTIAL
INFORMATION IS COVERED; CONFIDENTIALITY OBLIGATION SURVIVES TERMINATION. For purposes of this Agreement, the term
“affiliate” of the Employer includes any entity that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with the Corporation or the Bank. The rights and
obligations set forth in this Article 6 shall survive termination of this Agreement. 
 6.5 INJUNCTIVE
RELIEF. The Executive acknowledges that it is impossible to measure in money the damages that will accrue to the Employer if the Executive fails to observe the obligations imposed on him by this Article 6.
Accordingly, if the Employer institutes an action to enforce the provisions hereof, the Executive hereby waives the claim or defense that an adequate remedy at law is available to the Employer, and the Executive agrees not to urge in any such action
the claim or defense that an adequate remedy at law exists. The confidentiality and remedies provisions of this Article 6 shall be in addition to and shall not be deemed to supersede or restrict, limit, or impair the Employer’s rights under the
Trade Secrets Protection Act contained in Article 24, Chapter 66 of the North Carolina General Statutes or any other applicable state or federal statute or regulation dealing with or providing a remedy for the wrongful disclosure, misuse, or
misappropriation of trade secrets or proprietary or confidential information. 
 ARTICLE 7 
 COMPETITION AFTER TERMINATION OF EMPLOYMENT 
 7.1 COVENANT NOT TO COMPETE. (a) The Executive covenants and
agrees not to compete directly or indirectly with the Employer for one year after termination of the Executive’s employment. For purposes of this section – 
  

	 	1)	the term “compete” means 

  

	 	(a)	providing financial products or services on behalf of any financial institution for any person residing in the territory, 

  

	 	(b)	assisting (other than through the performance of ministerial or clerical duties) any financial institution in providing financial products or services to any person residing in the
territory, or 

  

 14 

	 	(c)	inducing or attempting to induce any person who was a customer of the Employer at the date of the Executive’s termination of employment to seek financial products or services
from another financial institution. 

  

	 	2)	the words “directly or indirectly” means – 

  

	 	(a)	acting as a consultant, officer, director, independent contractor, or employee of any financial institution in competition with the Employer in the territory, or

  

	 	(b)	communicating to such financial institution the names or addresses or any financial information concerning any person who was a customer of the Employer when the Executive’s
employment terminated. 

  

	 	3)	the term “customer” means any person to whom the Employer is providing financial products or services on the date of the Executive’s termination of employment.

  

	 	4)	the term “financial institution” means any bank, savings association, or bank or savings association holding company, or any other institution, the business of which is
engaging in activities that are financial in nature or incidental to such financial activities as described in section 4(k) of the Bank Holding Company Act of 1956, other than the Employer or one of its affiliated corporations.

  

	 	5)	“financial product or service” means any product or service that a financial institution or a financial holding company could offer by engaging in any activity that is
financial in nature or incidental to such a financial activity under section 4(k) of the Bank Holding Company Act of 1956 and that is offered by the Employer or an affiliate on the date of the Executive’s termination of employment, including
but not limited to banking activities and activities that are closely related and a proper incident to banking. 

  

	 	6)	the term “person” means any individual or individuals, corporation, partnership, fiduciary or association. 

  

	 	7)	the term “territory” means the area within a 15-mile radius of any full-service banking office of the Employer at the date of the Executive’s termination of
employment. 

 (b) If any provision of this section or any word, phrase, clause, sentence or other portion thereof (including,
without limitation, the geographical and temporal restrictions contained therein) is held to be unenforceable or invalid for any reason, the unenforceable or invalid provision or portion shall be modified or deleted so that the provisions hereof, as
modified, are legal and enforceable to the fullest extent permitted under applicable law. 
 7.2 INJUNCTIVE
AND OTHER RELIEF. If there is a breach or threatened breach of the provisions of section 7.1 by the Executive, the Employer shall be entitled to an injunction restraining the Executive
from such breach. Notwithstanding anything to the contrary in the June 23, 2005 Salary Continuation Agreement or in the Endorsement Split Dollar Agreement 
  

 15 

 attached thereto as Addendum A, if within one year after termination of the Executive’s employment the Executive
competes with the Employer in violation of this Article 7, the Employer shall be entitled to withhold all benefits payable under the Salary Continuation Agreement and the Executive shall be deemed to have forfeited any and all rights to benefits
under the Salary Continuation Agreement and under the Endorsement Split Dollar Agreement. Nothing herein shall be construed to prohibit the Employer from pursuing any other or additional remedies for the breach or threatened breach. 
 7.3 ARTICLE 7 SURVIVES TERMINATION BUT IS VOID
AFTER A CHANGE IN CONTROL. The rights and obligations set forth in this Article 7 shall survive termination of this Agreement. However, this Article 7
shall become null and void effective immediately upon a Change in Control. 
 ARTICLE 8 
 MISCELLANEOUS 
 8.1
SUCCESSORS AND ASSIGNS. (a) This Agreement Is Binding on Successors. This Agreement shall be binding upon the Employer and any successor to the Employer, including any
persons acquiring directly or indirectly all or substantially all of the business or assets of the Employer by purchase, merger, consolidation, reorganization, or otherwise. But this Agreement and the Employer’s obligations under this Agreement
are not otherwise assignable, transferable, or delegable by the Employer. By agreement in form and substance satisfactory to the Executive, the Employer shall require any successor to all or substantially all of the business or assets of the
Employer expressly to assume and agree to perform this Agreement in the same manner and to the same extent the Employer would be required to perform if no such succession had occurred. 
 (b) This Agreement Is Enforceable by the Executive and the Executive’s Heirs. This Agreement will inure to the benefit of and be enforceable
by the Executive’s personal or legal representatives, executors, administrators, successors, heirs, distributees, and legatees. 
 (c)
This Agreement Is Personal in Nature and Is Not Assignable. This Agreement is personal in nature. Without written consent of the other parties, no party shall assign, transfer, or delegate this Agreement or any rights or obligations under
this Agreement, except as expressly provided herein. Without limiting the generality or effect of the foregoing, the Executive’s right to receive payments hereunder is not assignable or transferable, whether by pledge, creation of a security
interest, or otherwise, except for a transfer by the Executive’s will or by the laws of descent and distribution. If the Executive attempts an assignment or transfer that is contrary to this section 8.1, the Employer shall have no liability to
pay any amount to the assignee or transferee. 
 8.2 GOVERNING LAW, JURISDICTION
AND FORUM. This Agreement shall be construed under and governed by the internal laws of the State of North Carolina, without giving effect to any conflict of laws provision or rule (whether of the
State of North Carolina or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of North Carolina. By entering into this Agreement, the Executive acknowledges that the Executive is subject to
the jurisdiction of both the federal and state courts in the State of North Carolina. Any actions or proceedings instituted under this Agreement shall be brought and tried solely in courts located in New Hanover County, North Carolina or in the
federal court having 
  

 16 

 jurisdiction in Wilmington, North Carolina. The Executive expressly waives the right to have any such actions or
proceedings brought or tried elsewhere. 
 8.3 ENTIRE AGREEMENT. This Agreement sets
forth the entire agreement of the parties concerning the employment of the Executive by the Employer. Any oral or written statements, representations, agreements, or understandings made or entered into prior to or contemporaneously with the
execution of this Agreement are hereby rescinded, revoked, and rendered null and void by the parties. This Agreement amends and restates in its entirety the Employment Agreement dated as of June 23, 2005 between the Executive and the Bank.

 8.4 NOTICES. All notices, requests, demands, and other communications hereunder shall be in writing
and shall be deemed to have been duly given if delivered by hand or mailed, certified or registered mail, return receipt requested, with postage prepaid. Unless otherwise changed by notice, notice shall be properly addressed to the Executive if
addressed to the address of the Executive on the books and records of the Employer at the time of the delivery of such notice, and properly addressed to the Employer if addressed to the Board of Directors, Cape Fear Bank Corporation, 1117 Military
Cutoff Road, Wilmington, North Carolina 28405. 
 8.5 SEVERABILITY. In the case of conflict between any
provision of this Agreement and any statute, regulation, or judicial precedent, the latter shall prevail, but the affected provisions of this Agreement shall be curtailed and limited solely to the extent necessary to bring them within the
requirements of law. If any provision of this Agreement is held by a court of competent jurisdiction to be indefinite, invalid, void or voidable, or otherwise unenforceable, the remainder of this Agreement shall continue in full force and effect
unless that would clearly be contrary to the intentions of the parties or would result in an injustice. 
 8.6 CAPTIONS
AND COUNTERPARTS. The captions in this Agreement are solely for convenience. The captions in no way define, limit, or describe the scope or intent of this Agreement. This Agreement may be executed in
several counterparts, each of which shall be deemed to be an original but all of which together shall constitute one and the same instrument. 
 8.7 NO DUTY TO MITIGATE. The Employer hereby acknowledges that it will be difficult and could be impossible (x) for the Executive to find
reasonably comparable employment after employment termination, and (y) to measure the amount of damages the Executive may suffer as a result of termination. Additionally, the Employer acknowledges that its general severance pay plans do
not provide for mitigation, offset, or reduction of any severance payment received thereunder. The Employer further acknowledges that the payment of severance benefits under this Agreement is reasonable and shall be liquidated damages. The Executive
shall not be required to mitigate the amount of any payment provided for in this Agreement by seeking other employment. Moreover, the amount of any payment provided for in this Agreement shall not be reduced by any compensation earned or benefits
provided as the result of employment of the Executive or as a result of the Executive being self-employed after employment termination. 
 8.8 AMENDMENT AND WAIVER. This Agreement may not be amended, released, discharged, abandoned, changed, or modified in any manner, except by an instrument in writing signed
by each of the parties hereto. The failure of any party hereto to enforce at any time any of the provisions of this Agreement shall not be construed to be a waiver of any such provision, nor affect the validity of this Agreement or any part thereof
or the right of any party thereafter to 
  

 17 

 enforce each and every such provision. No waiver or any breach of this Agreement shall be held to be a waiver of any
other or subsequent breach. 
 8.9 PAYMENT OF LEGAL FEES.
The Employer is aware that after a Change in Control management could cause or attempt to cause the Employer to refuse to comply with its obligations under this Agreement, or could institute or cause or attempt to cause the Employer to institute
litigation seeking to have this Agreement declared unenforceable, or could take or attempt to take other action to deny Executive the benefits intended under this Agreement. In these circumstances, the purpose of this Agreement would be frustrated.
It is the Employer’s intention that the Executive not be required to incur the expenses associated with the enforcement of rights under this Agreement, whether by litigation or other legal action, because the cost and expense thereof would
substantially detract from the benefits intended to be granted to the Executive hereunder. It is the Employer’s intention that the Executive not be forced to negotiate settlement of rights under this Agreement under threat of incurring
expenses. Accordingly, if after a Change in Control occurs it appears to the Executive that (x) the Employer has failed to comply with any of its obligations under this Agreement, or (y) the Employer or any other person has
taken any action to declare this Agreement void or unenforceable, or instituted any litigation or other legal action designed to deny, diminish, or to recover from the Executive the benefits intended to be provided to the Executive hereunder, the
Employer irrevocably authorizes the Executive from time to time to retain counsel of the Executive’s choice, at the Employer’s expense as provided in this section 8.9, to represent the Executive in connection with the initiation or defense
of any litigation or other legal action, whether by or against the Employer or any director, officer, stockholder, or other person affiliated with the Employer, in any jurisdiction. Notwithstanding any existing or previous attorney-client
relationship between the Employer and any counsel chosen by the Executive under this section 8.9, the Employer irrevocably consents to the Executive entering into an attorney-client relationship with that counsel, and the Employer and the Executive
agree that a confidential relationship shall exist between the Executive and that counsel. The fees and expenses of counsel selected from time to time by the Executive as provided in this section shall be paid or reimbursed to the Executive by the
Employer on a regular, periodic basis upon presentation by the Executive of a statement or statements prepared by such counsel in accordance with such counsel’s customary practices, up to a maximum aggregate amount of $500,000, whether suit be
brought or not, and whether or not incurred in trial, bankruptcy, or appellate proceedings. The Employer’s obligation to pay the Executive’s legal fees under this section 8.9 operates separately from and in addition to any legal fee
reimbursement obligation the Employer may have with the Executive under any separate severance or other agreement. Despite anything in this section 8.9 to the contrary however, the Employer shall not be required to pay or reimburse the
Executive’s legal expenses if doing so would violate section 18(k) of the Federal Deposit Insurance Act [12 U.S.C. 1828(k)] and Rule 359.3 of the Federal Deposit Insurance Corporation [12 CFR 359.3]. 
 8.10 COMPLIANCE WITH INTERNAL REVENUE CODE
SECTION 409A. The Employer and the Executive intend that their exercise of authority or discretion under this Agreement shall comply with section 409A of the Internal Revenue Code of 1986. If when the Executive’s
employment terminates the Executive is a specified employee, as defined in section 409A of the Internal Revenue Code of 1986, and if any payments under this Agreement, including Articles 4 or 5, will result in additional tax or interest to the
Executive because of section 409A, then despite any contrary provision of this Agreement the Executive will not be entitled to the payments until the earliest of (x) the date that is at least six months after termination of the

  

 18 

 Executive’s employment for reasons other than the Executive’s death, (y) the date of the
Executive’s death, or (z) any earlier date that does not result in additional tax or interest to the Executive under section 409A. As promptly as possible after the end of the period during which payments are delayed under this
provision, the entire amount of the delayed payments shall be paid to the Executive in a single lump sum. If any provision of this Agreement does not satisfy the requirements of section 409A, such provision shall nevertheless be applied in a manner
consistent with those requirements. If any provision of this Agreement would subject the Executive to additional tax or interest under section 409A, the Employer shall reform the provision. However, the Employer shall maintain to the maximum extent
practicable the original intent of the applicable provision without subjecting the Executive to additional tax or interest, and the Employer shall not be required to incur any additional compensation expense as a result of the reformed provision.

 IN WITNESS WHEREOF, the parties have executed this Amended Employment
Agreement as of the date first written above. 
  

									
	EXECUTIVE	 		 	CAPE FEAR BANK
				
	 /s/ J. Cameron Coburn
	 		 	 By:
	 	 /s/ Betty V. Norris

	John Cameron Coburn	 		 	 Its:
	 	 Senior Vice President and Chief Financial Officer

			
		 		 	CAPE FEAR BANK CORPORATION
				
		 		 	 By:
	 	 /s/ Betty V. Norris

		 		 	 Its:
	 	 Senior Vice President and Chief Financial Officer

  

 19Severance Agreement

 EXHIBIT 10.02 
 SEVERANCE AGREEMENT 
 This SEVERANCE
AGREEMENT is entered into as of this 22nd day of November, 2006, by and among Cape Fear Bank Corporation, a North Carolina corporation formerly known as Bank of Wilmington Corporation (the
“Corporation”), Cape Fear Bank, formerly known as Bank of Wilmington, a North Carolina bank, and Larry W. Flowers, its Executive Vice President and Chief Credit Officer of the Corporation and the Bank (the
“Executive”). 
 WHEREAS, the Executive has made and is expected to continue to make
substantial contributions to the profitability, growth, and financial strength of Cape Fear Bank Corporation and its subsidiary bank, Cape Fear Bank, a North Carolina-chartered bank, 
 WHEREAS, Cape Fear Bank Corporation desires to assure itself of the current and future continuity of management and,
establishing minimum severance benefits for certain officers and other key employees, including the Executive, desires to ensure that officers and other key employees are not practically disabled from discharging their duties if a proposed or actual
change in control arises, 
 WHEREAS, Cape Fear Bank Corporation wishes to provide additional inducement
for the Executive to remain in the employ of the Bank, 
 WHEREAS, Cape Fear Bank Corporation and the
Executive intend that this Severance Agreement shall supersede and replace in its entirety the Change of Control Agreement dated as of March 22, 1999 by and between Bank of Wilmington and the Executive, as amended, and that from and after the
date of this Severance Agreement the Change of Control Agreement dated as of March 22, 1999, as amended, shall be of no further force or effect, and 
 WHEREAS, none of the conditions or events included in the definition of the term “golden parachute payment” that is set forth in section 18(k)(4)(A)(ii) of the Federal
Deposit Insurance Act [12 U.S.C. 1828(k)(4)(A)(ii)] and in Federal Deposit Insurance Corporation Rule 359.1(f)(1)(ii) [12 CFR 359.1(f)(1)(ii)] exists or, to the best knowledge of Cape Fear Bank Corporation, is contemplated insofar as either of Cape
Fear Bank Corporation or any of its subsidiaries is concerned. 
 NOW THEREFORE, in
consideration of these premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows. 
 1. CHANGE IN CONTROL SEVERANCE. (a) Involuntary
Termination Without Cause or Voluntary Termination for Good Reason Within One Year after a Change in Control. Cape Fear Bank Corporation shall make a lump-sum payment to the Executive in an amount in cash 
  

 equal to two times the Executive’s annual compensation if the Executive’s employment with Cape Fear Bank
Corporation and subsidiaries is involuntarily terminated within 12 months after a Change in Control, except for termination under section 4 of this Severance Agreement, or if the Executive terminates employment with Cape Fear Bank Corporation and
subsidiaries for Good Reason within 12 months after a Change in Control. Subject to section 17, the payment required under this section 1(a) is payable no later than three business days after the date the Executive’s employment terminates and
shall not be reduced to account for the time value of money or discounted to present value. If the Executive terminates employment for Good Reason, the date of termination shall be the date specified by the Executive in the notice of termination. If
the Executive is removed from office or if the Executive’s employment terminates before the Change in Control occurs but after discussions with a third party regarding a Change in Control commence, and if those discussions ultimately conclude
with a Change in Control, then for purposes of this Severance Agreement the removal of the Executive or termination of the Executive’s employment shall be deemed to have occurred after the Change in Control. 
 For purposes of this Severance Agreement, annual compensation means (x) the Executive’s annual base salary on the date of the Change in
Control or on the date of the Executive’s employment termination (at whichever date the Executive’s current annual base salary is greater, but excluding any compensation earned in the Executive’s capacity as a director), plus
(y) any bonus earned for the most recent whole calendar year before the year in which the Change in Control occurred or for the most recent whole calendar year before the year in which employment termination occurred (whichever is
greater), regardless of whether the bonus is paid in the year earned or in a later calendar year. The term bonus means cash or non-cash compensation of the type that is required to be reported as bonus by the Securities and Exchange
Commission’s rules governing tabular disclosure of executive compensation, specifically Regulation S-K Item 402 (17 CFR 229.402 (2006), currently Item 402(c)(2)(iv)). For purposes of this Severance Agreement, the term subsidiary means
any entity in which Cape Fear Bank Corporation directly or indirectly beneficially owns 50% or more of the outstanding voting securities. 
 (b) Additional Severance Benefits. In addition to the severance payment due under paragraph (a) of this section 1, if the Executive is entitled to a lump-sum severance payment under paragraph (a) after employment
termination Cape Fear Bank Corporation shall (x) cause the Executive to become fully vested in any qualified and non-qualified plans, programs, or arrangements in which the Executive participated if the plan, program, or arrangement does
not address the effect of a change in control, and (y) contribute or cause to be contributed to the Executive’s 401(k) plan account the matching and profit-sharing contributions, if any, that the Executive is entitled to based upon
all W-2 income earned by the Executive for the plan year. 
 2. DEFINITION OF CHANGE
IN CONTROL. For purposes of this Severance Agreement, the term Change in Control means any of the following events occur – 
  

 2 

 (a) Merger: Cape Fear Bank Corporation merges into or consolidates with another corporation, or
merges another corporation into Cape Fear Bank Corporation, and as a result less than a majority of the combined voting power of the resulting corporation immediately after the merger or consolidation is held by persons who were stockholders of Cape
Fear Bank Corporation immediately before the merger or consolidation. For purposes of this Severance Agreement, the term person means an individual, corporation, partnership, trust, association, joint venture, pool, syndicate, sole proprietorship,
unincorporated organization, or other entity, 
 (b) Acquisition of Significant Share Ownership: a report on Schedule 13D, Schedule
TO, or another form or schedule (other than Schedule 13G), is filed or is required to be filed under sections 13(d) or 14(d) of the Securities Exchange Act of 1934, if the schedule discloses that the filing person or persons acting in concert has or
have become the beneficial owner of 25% or more of the combined voting power of Cape Fear Bank Corporation’s voting securities (but this paragraph (b) shall not apply to beneficial ownership of voting shares held by a subsidiary in a
fiduciary capacity or beneficial ownership of voting shares held by an employee benefit plan of Cape Fear Bank Corporation or a subsidiary), 
 (c) Change in Board Composition: during any period of two consecutive years, individuals who constitute Cape Fear Bank Corporation’s board of directors at the beginning of the two-year period cease for any reason to constitute
at least a majority thereof; provided, however, that – for purposes of this paragraph (c) – each director who is first elected by the board (or first nominated by the board for election by stockholders) by a vote of at least
two-thirds (b) of the directors who were directors at the beginning of the period shall be deemed to have been a director at the beginning of the two-year period, or 
 (d) Sale of Assets: Cape Fear Bank Corporation sells to a third party substantially all of Cape Fear Bank Corporation’s assets. For purposes of this Severance Agreement, sale of substantially all of Cape
Fear Bank Corporation’s assets includes sale of the shares or assets of Cape Fear Bank alone. 
 3. GOOD
REASON. For purposes of this Severance Agreement, the term Good Reason means the occurrence of any of the following without the Executive’s written consent – 
 (a) reduction of the Executive’s base salary, or 
 (b) reduction of the Executive’s bonus, incentive, and other compensation award opportunities under Cape Fear Bank Corporation’s or subsidiary’s benefit plans, unless a company-wide reduction of all
officers’ award opportunities occurs simultaneously, or termination of the Executive’s participation in any officer or employee benefit plan maintained by Cape Fear Bank Corporation or a subsidiary, unless the plan is terminated because of
changes in law or loss of tax deductibility to Cape Fear Bank Corporation for contributions to the plan, or unless the plan is terminated as a matter of policy applied equally to all participants, or 
 (c) assignment to the Executive of duties or responsibilities that are materially inconsistent with the Executive’s duties and responsibilities
immediately before the Change in 
  

 3 

 Control, or any other action by Cape Fear Bank Corporation or its successor that results in a material reduction or
material adverse change in the Executive’s position, authority, duties, or responsibilities, or failure to nominate the Executive as a director of Cape Fear Bank Corporation if the Executive shall have been a director immediately before the
Change in Control, or 
 (d) failure to obtain an assumption of Cape Fear Bank Corporation’s obligations under this Severance Agreement
by a successor to Cape Fear Bank Corporation, regardless of whether the entity becomes a successor as a result of a merger, consolidation, sale of assets, or other form of reorganization, or 
 (e) relocation of Cape Fear Bank’s principal executive offices or requiring the Executive to change the Executive’s principal work location to
any location that is more than 50 miles from the location of Cape Fear Bank’s principal executive offices on the date of this Severance Agreement. 
 4. TERMINATION FOR WHICH NO SEVERANCE BENEFITS ARE PAYABLE. (a) No
Severance after Termination for Cause. Despite any provision of this Severance Agreement to the contrary, under no circumstance shall the Executive be entitled to severance benefits if the Executive’s employment terminates for Cause. For
purposes of this Severance Agreement the term Cause means the Executive shall have committed any of the following acts – 
 1) Fraud, Embezzlement, Theft or Other Crime: an act of fraud, embezzlement, or theft while employed by Cape Fear Bank Corporation or a subsidiary, conviction of the Executive for or plea of no contest to a felony or conviction of or
plea of no contest to a misdemeanor involving moral turpitude, or the actual incarceration of the Executive for 45 consecutive days or more, or 
 2) Negligence and Other Actions: gross negligence, insubordination, disloyalty, or dishonesty in the performance of the Executive’s duties as an officer of Cape Fear Bank Corporation or a subsidiary;
wilful or reckless failure by the Executive to adhere to Cape Fear Bank Corporation’s or subsidiary’s written policies; intentional wrongful damage by the Executive to the business or property of Cape Fear Bank Corporation, including
without limitation its reputation, which in Cape Fear Bank Corporation’s sole judgment causes material harm to Cape Fear Bank Corporation; breach by the Executive of fiduciary duties to Cape Fear Bank Corporation and its stockholders, whether
in the Executive’s capacity as an officer or a director of Cape Fear Bank Corporation or a subsidiary, 
 3)
Removal: removal of the Executive from office or permanent prohibition of the Executive from participating in Cape Fear Bank’s affairs by an order issued under section 8(e)(4) or (g)(1) of the Federal Deposit Insurance Act, 12 U.S.C.
1818(e)(4) or (g)(1), or 
 4) Disclosure of Trade Secrets: intentional wrongful disclosure of secret processes or
confidential information of Cape Fear Bank Corporation or affiliates, which 
  

 4 

 in Cape Fear Bank Corporation’s sole judgment causes material harm to Cape Fear Bank Corporation or
affiliates, or 
 5) Termination for Cause under an Employment Agreement: any actions that have caused the Executive to
be terminated for cause under any employment agreement existing on the date hereof or hereafter entered into between the Executive and Cape Fear Bank Corporation or a subsidiary, or 
 6) Exclusion from Fidelity Coverage: the occurrence of any event that results in the Executive being excluded from coverage, or
having coverage limited for the Executive as compared to other executives of Cape Fear Bank Corporation or affiliates, under a blanket bond or other fidelity or insurance policy covering directors, officers, or employees. 
 Definition of “Intentional”: For purposes of this Severance Agreement, no act or failure to act on the Executive’s part shall be
deemed to have been intentional if it was due primarily to an error in judgment or negligence. An act or failure to act on the Executive’s part shall be considered intentional if it is not in good faith and if it is without a reasonable belief
that the action or failure to act is in the best interests of Cape Fear Bank Corporation. Any act or failure to act based upon authority granted by resolutions duly adopted by the board of directors or based upon the advice of counsel for Cape Fear
Bank Corporation shall be conclusively presumed to be in good faith and in the best interests of Cape Fear Bank Corporation 
 (b) No
Severance under this Severance Agreement for the Executive’s Death or Disability. Despite any contrary provision in this Severance Agreement, under no circumstance shall the Executive be entitled to severance benefits under this Severance
Agreement if (x) the Executive dies while actively employed by Cape Fear Bank Corporation or a subsidiary, or (y) the Executive becomes totally disabled while actively employed by Cape Fear Bank Corporation or a subsidiary.
For purposes of this Severance Agreement, the term totally disabled means that because of injury or sickness, the Executive is unable to perform the Executive’s duties. The benefits, if any, payable to the Executive or the Executive’s
beneficiary(ies) or estate after death or disability shall be determined solely by such benefit plans or arrangements as Cape Fear Bank Corporation or a subsidiary may have with the Executive relating to death or disability, not by this Severance
Agreement. 
 5. TERM OF AGREEMENT. The initial term of this
Severance Agreement shall be for a period of three years, commencing November 22, 2006. On the first anniversary of the November 22, 2006 effective date of this Severance Agreement and on each anniversary thereafter this Severance
Agreement shall be extended automatically for one additional year, unless Cape Fear Bank Corporation’s board of directors gives notice to the Executive in writing at least 90 days before the anniversary that the term of this Severance Agreement
will not be extended. If the board of directors determines not to extend the term, it shall promptly notify the Executive. References herein to the term of this Severance Agreement mean the initial term and extensions of the initial term. If the
board of directors decides not to extend the term of this Severance Agreement, this Severance Agreement shall nevertheless 
  

 5 

 remain in force until its term expires. The board’s decision not to extend the term of this Severance Agreement
shall not – by itself – constitute Good Reason and shall not give the Executive any rights under this Severance Agreement to claim an adverse change in position, compensation, or circumstances or otherwise to claim entitlement to severance
benefits under this Severance Agreement. 
 6. THIS SEVERANCE AGREEMENT
IS NOT AN EMPLOYMENT CONTRACT. The parties hereto acknowledge and agree that (x) this Severance Agreement is not a management or employment
agreement and (y) nothing in this Severance Agreement shall give the Executive any rights or impose any obligations to continued employment by Cape Fear Bank Corporation or any subsidiary or successor of Cape Fear Bank Corporation.

 7. WITHHOLDING OF TAXES. Cape Fear Bank Corporation may withhold
from any benefits payable under this Severance Agreement all Federal, state, local or other taxes as may be required by law, governmental regulation or ruling. 
 8. SUCCESSORS AND ASSIGNS. (a) This Agreement Is Binding on Successors. This Severance Agreement shall be binding upon Cape Fear
Bank Corporation and any successor to Cape Fear Bank Corporation, including any persons acquiring directly or indirectly all or substantially all of the business or assets of Cape Fear Bank Corporation by purchase, merger, consolidation,
reorganization, or otherwise. But this Severance Agreement and Cape Fear Bank Corporation’s obligations under this Severance Agreement are not otherwise assignable, transferable, or delegable by Cape Fear Bank Corporation. By agreement in form
and substance satisfactory to the Executive, Cape Fear Bank Corporation shall require any successor to all or substantially all of the business or assets of Cape Fear Bank Corporation expressly to assume and agree to perform this Severance Agreement
in the same manner and to the same extent Cape Fear Bank Corporation would be required to perform if no such succession had occurred. 
 (b)
This Severance Agreement Is Enforceable by the Executive and Heirs. This Severance Agreement will inure to the benefit of and be enforceable by the Executive’s personal or legal representatives, executors, administrators, successors,
heirs, distributes, and legatees. 
 (c) This Severance Agreement Is Personal in Nature and Is Not Assignable. This Severance
Agreement is personal in nature. Without written consent of the other party, neither party shall assign, transfer, or delegate this Severance Agreement or any rights or obligations under this Severance Agreement except as expressly provided in this
section 8. Without limiting the generality of the foregoing, the Executive’s right to receive payments hereunder is not assignable or transferable, whether by pledge, creation of a security interest, or otherwise, except for a transfer by
Executive’s will or by the laws of descent and distribution. If the Executive attempts an assignment or transfer that is contrary to this section 8, Cape Fear Bank Corporation shall have no liability to pay any amount to the assignee or
transferee. 
 9. GOVERNING LAW, JURISDICTION AND
FORUM. This Severance Agreement shall be construed under and governed by the internal laws of the State of North Carolina, without giving effect to any conflict of laws provision or rule (whether of the State of
North Carolina or 
  

 6 

 any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of North
Carolina. By executing this Severance Agreement, the Executive acknowledges that the Executive is subject to the jurisdiction of both the federal and state courts in the State of North Carolina. Any actions or proceedings instituted under this
Severance Agreement shall be brought and tried solely in courts located in New Hanover County, North Carolina or in the federal court having jurisdiction in Wilmington, North Carolina. The Executive expressly waives the right to have any such
actions or proceedings brought or tried elsewhere. 
 10. ENTIRE AGREEMENT. This
Severance Agreement sets forth the entire agreement between Cape Fear Bank Corporation and the Executive concerning the subject matter. Any oral or written statements, representations, agreements, or understandings made or entered into before or
contemporaneously with the execution of this Severance Agreement are hereby rescinded, revoked, and rendered null and void by the parties. This Severance Agreement supersedes and replaces in its entirety the Change of Control Agreement dated as of
March 22, 1999, as amended, between the Executive and Bank of Wilmington, and from and after the date of this Severance Agreement the Change of Control Agreement dated as of March 22, 1999, as amended, shall be of no further force or
effect. 
 11. NOTICES. All notices, requests, demands, and other communications hereunder shall
be in writing and shall be deemed to have been duly given if delivered by hand or mailed, certified or registered mail, return receipt requested, with postage prepaid. Unless otherwise changed by notice, notice shall be properly addressed to the
Executive if addressed to the address of the Executive on the books and records of Cape Fear Bank Corporation at the time of the delivery of such notice, and properly addressed to Cape Fear Bank Corporation if addressed to the Board of Directors,
Cape Fear Bank Corporation, 1117 Military Cutoff Road, Wilmington, North Carolina 28405. 
 12.
SEVERABILITY. In the case of conflict between any provision of this Severance Agreement and any statute, regulation, or judicial precedent, the latter shall prevail, but the affected provisions of this Severance
Agreement shall be curtailed and limited solely to the extent necessary to bring them within the requirements of law. If any provision of this Severance Agreement is held by a court of competent jurisdiction to be indefinite, invalid, void or
voidable, or otherwise unenforceable, the remainder of this Severance Agreement shall continue in full force and effect unless that would clearly be contrary to the intentions of the parties or would result in an injustice. 
 13. CAPTIONS AND COUNTERPARTS. The captions in this Severance Agreement are
solely for convenience. The captions in no way define, limit, or describe the scope or intent of this Severance Agreement. This Severance Agreement may be executed in several counterparts, each of which shall be deemed to be an original but all of
which together shall constitute one and the same instrument. 
 14. NO DUTY TO
MITIGATE. The Cape Fear Bank Corporation hereby acknowledges that it will be difficult and could be impossible (x) for the Executive to find reasonably 
  

 7 

 comparable employment after employment termination, and (y) to measure the amount of damages the Executive
may suffer as a result of termination. Additionally, Cape Fear Bank Corporation acknowledges that its general severance pay plans do not provide for mitigation, offset, or reduction of any severance payment received thereunder. Cape Fear Bank
Corporation further acknowledges that the payment of severance benefits under this Severance Agreement is reasonable and shall be liquidated damages. The Executive shall not be required to mitigate the amount of any payment provided for in this
Severance Agreement by seeking other employment. Moreover, the amount of any payment provided for in this Severance Agreement shall not be reduced by any compensation earned or benefits provided as the result of employment of the Executive or as a
result of the Executive being self-employed after employment termination. 
 15. AMENDMENT AND
WAIVER. This Severance Agreement may not be amended, released, discharged, abandoned, changed, or modified in any manner, except by an instrument in writing signed by each of the parties hereto. The failure of any
party hereto to enforce at any time any of the provisions of this Severance Agreement shall not be construed to be a waiver of any such provision, nor affect the validity of this Severance Agreement or any part thereof or the right of any party
thereafter to enforce each and every such provision. No waiver or any breach of this Severance Agreement shall be held to be a waiver of any other or subsequent breach. 
 16. PAYMENT OF LEGAL FEES. Cape Fear Bank Corporation is aware that after a Change in Control management could cause or attempt
to cause Cape Fear Bank Corporation to refuse to comply with its obligations under this Severance Agreement, or could institute or cause or attempt to cause Cape Fear Bank Corporation to institute litigation seeking to have this Severance Agreement
declared unenforceable, or could take or attempt to take other action to deny Executive the benefits intended under this Severance Agreement. In these circumstances, the purpose of this Severance Agreement would be frustrated. It is Cape Fear Bank
Corporation’s intention that the Executive not be required to incur the expenses associated with the enforcement of rights under this Severance Agreement, whether by litigation or other legal action, because the cost and expense thereof would
substantially detract from the benefits intended to be granted to the Executive hereunder. It is Cape Fear Bank Corporation’s intention that the Executive not be forced to negotiate settlement of rights under this Severance Agreement under
threat of incurring expenses. Accordingly, if after a Change in Control occurs it appears to the Executive that (x) Cape Fear Bank Corporation has failed to comply with any of its obligations under this Severance Agreement, or
(y) Cape Fear Bank Corporation or any other person has taken any action to declare this Severance Agreement void or unenforceable, or instituted any litigation or other legal action designed to deny, diminish, or to recover from the
Executive the benefits intended to be provided to the Executive hereunder, Cape Fear Bank Corporation irrevocably authorizes the Executive from time to time to retain counsel of the Executive’s choice, at Cape Fear Bank Corporation’s
expense as provided in this section 16, to represent the Executive in connection with the initiation or defense of any litigation or other legal action, whether by or against Cape Fear Bank Corporation or any director, officer, stockholder, or other
person affiliated with Cape Fear Bank Corporation, in any jurisdiction. Notwithstanding any existing or previous attorney-client relationship between Cape Fear Bank Corporation and any counsel chosen by the Executive under this section 16, Cape Fear
Bank Corporation irrevocably consents to the Executive entering into an attorney-client relationship 
  

 8 

 with that counsel, and Cape Fear Bank Corporation and the Executive agree that a confidential relationship shall exist
between the Executive and that counsel. The fees and expenses of counsel selected from time to time by the Executive as provided in this section shall be paid or reimbursed to the Executive by Cape Fear Bank Corporation on a regular, periodic basis
upon presentation by the Executive of a statement or statements prepared by such counsel in accordance with such counsel’s customary practices, up to a maximum aggregate amount of $100,000, whether suit be brought or not, and whether or not
incurred in trial, bankruptcy, or appellate proceedings. Cape Fear Bank Corporation’s obligation to pay the Executive’s legal fees under this section 16 operates separately from and in addition to any legal fee reimbursement obligation
Cape Fear Bank Corporation may have with the Executive under any separate severance or other agreement. Despite any contrary provision of this Severance Agreement however, Cape Fear Bank Corporation shall not be required to pay or reimburse the
Executive’s legal expenses if doing so would violate section 18(k) of the Federal Deposit Insurance Act [12 U.S.C. 1828(k)] and Rule 359.3 of the Federal Deposit Insurance Corporation [12 CFR 359.3]. 
 17. COMPLIANCE WITH INTERNAL REVENUE CODE
SECTION 409A. Cape Fear Bank Corporation and the Executive intend that their exercise of authority or discretion under this Severance Agreement shall comply with section 409A of the Internal Revenue Code of 1986. If when the
Executive’s employment terminates the Executive is a specified employee within the meaning of section 409A of the Internal Revenue Code of 1986, and if any payments under this Severance Agreement will result in additional tax or interest to the
Executive because of section 409A, then despite any contrary provision of this Severance Agreement the Executive will not be entitled to the payments until the earliest of (x) the date that is at least six months after termination of the
Executive’s employment for reasons other than the Executive’s death, (y) the date of the Executive’s death, or (z) any earlier date that does not result in additional tax or interest to the Executive under
section 409A. As promptly as possible after the end of the period during which payments are delayed under this provision, the entire amount of the delayed payments shall be paid to the Executive in a single lump sum. If any provision of this
Severance Agreement does not satisfy the requirements of section 409A, the provision shall nevertheless be applied in a manner consistent with those requirements. If any provision of this Severance Agreement would subject the Executive to additional
tax or interest under section 409A, Cape Fear Bank Corporation shall reform the provision. However, Cape Fear Bank Corporation shall maintain to the maximum extent practicable the original intent of the applicable provision without subjecting the
Executive to additional tax or interest, and Cape Fear Bank Corporation shall not be required to incur any additional compensation expense as a result of the reformed provision. 
  

 9 

 IN WITNESS WHEREOF, the parties have
executed this Severance Agreement as of the date first written above. 
  

					
	EXECUTIVE	 	CAPE FEAR BANK CORPORATION
			
	 /s/ Larry W. Flowers
	 	By:	 	 /s/ Cameron Coburn

	Larry W. Flowers	 	Its:	 	President and Chief Executive Officer

  

 10

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00113-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00113-of-00352.parquet"}]]