Document:

Amendment 1 & Agreement dated 03/23/07

 Exhibit 10.1 
 AMENDMENT NO. 1 AND AGREEMENT dated as of March 23, 2007 (this “Amendment”), to the Third Amended and
Restated Credit Agreement dated as of December 28, 2006 (the “Credit Agreement”), among ATP OIL & GAS CORPORATION (the “Borrower”), the Lenders (as defined therein) and CREDIT SUISSE, as
administrative agent (in such capacity, the “Administrative Agent”) and as collateral agent (in such capacity, the “Collateral Agent”) for the Lenders. 
 A. Pursuant to the Credit Agreement, the Lenders have extended, and have agreed to extend, credit to the Borrower. 
 B. The Borrower has requested that the existing Lenders or other persons that will thereby become lenders (collectively, the “Additional Term
Lenders”) make Additional Term Loans (as defined below) to the Borrower on the Additional Term Loan Closing Date (as defined below), in an aggregate principal amount of $375,000,000, subject to the terms and conditions set forth herein.

 C. The Borrower has further requested certain amendments to the Credit Agreement as set forth herein. 
 D. The proceeds of the Additional Term Loans will be used by the Borrower (i) on the Additional Term Loan Closing Date, to (A) prepay
$175,000,000 in aggregate principal amount of loans outstanding under, pay all other amounts due under, and terminate (collectively, the “Refinancing”) the Second Lien Credit Agreement dated as of November 22, 2006 (the
“Second Lien Credit Agreement”), among the Borrower, the lenders party thereto and Credit Suisse, as administrative agent, and (B) pay fees and expenses in connection with the Refinancing and this Amendment and
(ii) thereafter, to fund development activities and for other general corporate purposes of the Borrower. 
 E. The Additional Term
Lenders are willing to make the Additional Term Loans, and the Required Lenders are willing to agree to such amendments, in each case on the terms and subject to the conditions set forth herein. 
 F. Capitalized terms used but not defined herein shall have the meanings assigned to them in the Credit Agreement. 
 Accordingly, in consideration of the mutual agreements herein contained and other good and valuable consideration, the sufficiency and receipt of which
are hereby acknowledged, the parties hereto agree as follows: 
 SECTION 1. Defined Terms. As used in this Amendment, the following
terms shall have the meanings set forth below: 
 “Additional Term Loan Commitment” shall mean, with
respect to each Additional Term Lender, the commitment of such Additional Term Lender to make Additional Term Loans on the Additional Term Loan Closing Date as set forth on Schedule I hereto. The aggregate amount of Additional Term Loan Commitments
shall be $375,000,000. 

 “Additional Term Loans” shall mean the term loans made by the
Additional Term Lenders to the Borrower pursuant to Section 2(a) hereof, the terms and provisions of which shall be identical to the existing Term Loans. 
 SECTION 2. Additional Term Loans. (a) Subject to the terms and conditions set forth herein and relying upon the representations and warranties set forth herein and in the other Loan Documents, each
Additional Term Lender agrees, severally and not jointly, to make an Additional Term Loan to the Borrower on the Additional Term Loan Closing Date in a principal amount not to exceed its Additional Term Loan Commitment. Amounts paid or prepaid in
respect of Additional Term Loans may not be reborrowed. 
 (b) The Additional Term Loan Commitments shall automatically terminate upon the
earlier to occur of (a) the making of the Additional Term Loans on the Additional Term Loan Closing Date and (b) 5:00 p.m., New York City time, on April 3, 2007. 
 (c) Unless the context shall otherwise require, the terms “Term Loans” and “Loans” as used in the Credit Agreement shall include the
Additional Term Loans, and the terms “Term Lender” and “Lenders” as used herein and in the Credit Agreement shall include each person that has an Additional Term Loan Commitment or that has made an Additional Term Loan (other
than any such person that has ceased to be a party to the Credit Agreement pursuant to an Assignment and Acceptance). 
 SECTION 3.
Amendments. (a) The definition of the term “Net Cash Proceeds” set forth in Section 1.01 of the Credit Agreement is hereby amended by (i) deleting the word “and” immediately prior to clause (b) thereof,
(ii) deleting the period at the end of clause (b) thereof and substituting therefor “; and” and (iii) inserting at the end thereof a new clause (c) that reads in its entirety as follows: 
 “(c) with respect to any Permitted MLP Transfer or MLP Extraordinary Distribution, the cash proceeds thereof, net of all taxes, costs
and other expenses incurred in connection therewith; provided, however, that, if no Default or Event of Default shall have occurred and shall be continuing at the time of the receipt of such proceeds or at the proposed time of the
application thereof, an amount not to exceed 50% of such proceeds shall not constitute Net Cash Proceeds to the extent reinvested or contractually committed to be reinvested in productive assets of a kind then used or usable in the business of the
Borrower and the Subsidiaries within 180 days of such receipt.”. 
 (b) The definition of the term “Pro Forma Basis” set
forth in Section 1.01 of the Credit Agreement is hereby amended by (i) deleting the word “or” at the end of clause (a) thereof and substituting a comma therefor, (ii) inserting immediately after the words “for the
relevant period are available” appearing in the fifth line thereof a new clause (c) that reads “or (c) any Permitted MLP Transfer”, (iii) by inserting immediately following 

 
each subsequent appearance of the words “Asset Sale” in such definition the words “or Permitted MLP Transfer”, (iv) by inserting
immediately following the words “Asset Sales” in such definition the words “or Permitted MLP Transfers”, (v) by inserting immediately after the words “historical financial statements” appearing in the eleventh line
thereof the words “(or, in the case of a Permitted MLP Transfer, other relevant historical financial information)” and (vi) by adding the words “or otherwise transferred” immediately after the words “acquired or
sold” appearing in the twelfth line thereof. 
 (c) The definition of the term “Reserve Report” set forth in Section 1.01
of the Credit Agreement is hereby amended by deleting the words “an Independent Engineering Firm (prepared on a “mechanical roll-forward” basis based on the most recent annual reserve report prepared by such firm)” appearing in
the third, fourth and fifth lines thereof and substituting therefor the words “the Borrower, in form and detail reasonably acceptable to the Administrative Agent (it being understood and agreed that the Borrower will prepare each such
semi-annual reserve report based on the most recent annual Reserve Report, as adjusted for actual production, operating costs, capital costs and net additions of Proved Reserves and probable reserves during the first six calendar months;
provided that any semi-annual reserve report shall include Excess Reserve Value only to the extent that the Borrower provides supporting information for such Excess Reserve Value from an Independent Engineering Firm pursuant to
Section 5.04(d))”. 
 (d) The definition of the term “Subsidiary” set forth in Section 1.01 of the Credit Agreement
is hereby amended and restated in its entirety to read as follows: 
 ““Subsidiary” shall mean
any subsidiary of the Borrower, other than a Permitted MLP and any subsidiary of a Permitted MLP.”. 
 (e) Section 1.01 of the
Credit Agreement is hereby amended by adding the following defined terms in appropriate alphabetical order: 
 ““Amendment No. 1” shall mean Amendment No. 1 and Agreement dated as of March 23, 2007, to this Agreement.” 
 ““Amendment No. 1 Effective Date” shall mean the date on which Amendment No. 1 becomes effective in
accordance with its terms.” 
 ““Excess Reserve Value” shall mean the excess of (i) the
sum of (a) PV-10 Value and (b) Probable Reserve Value, related to net additions to Proved Reserves and probable reserves over (ii) 5% multiplied by the sum of (a) PV-10 Value and (b) Probable Reserve Value. All PV-10 Values
and Probable Reserve Values in this definition shall be as calculated for the current year semi-annual Reserve Report before giving effect to the exclusion of any Excess Reserve Value.” 
 ““MLP” shall mean a master limited partnership.” 
 ““MLP Extraordinary Distribution” shall mean any dividends or distributions made by a Permitted MLP or
Permitted GP other than any dividends or distributions out of the operating surplus of such Permitted MLP or Permitted GP.” 

 ““Permitted GP” shall mean any general partner of a
Permitted MLP.” 
 ““Permitted MLP” shall mean any MLP to which the Borrower or a Subsidiary
shall have made a Permitted MLP Transfer either directly to such MLP or to a subsidiary of such MLP, including any successor person to such MLP.” 
 ““Permitted MLP Transfer” shall mean any sale, transfer or other disposition of assets to an MLP or subsidiary of an MLP in which (i) the assets so transferred are limited to physical
non-production assets (e.g., gathering lines, processing facilities and pipelines); (ii) the Borrower shall have notified the Administrative Agent reasonably prior to such sale, transfer or other disposition of assets and of the
principal terms and conditions thereof; (iii) the sale, transfer or other disposition of assets is for fair market value (as determined in good faith by the Borrower’s board of directors) and for consideration consisting solely of
(x) cash or (y) non-cash consideration in the form of Equity Interests in the applicable MLP or the general partner of the applicable MLP; (iv) the fair market value of the sale, transfer or other disposition of assets plus the
aggregate fair market value of all prior Permitted MLP Transfers does not exceed $500,000,000; (v) the fair market value of Equity Interests received plus the aggregate fair market value of Equity Interests received in all prior Permitted MLP
Transfers (in each case, valued at the time of receipt of the applicable Equity Interests) does not exceed $250,000,000; and (vi) the other terms and conditions and any related agreements or arrangements are consistent with those customarily
found in MLP transactions as determined in good faith by the Borrower and reasonably acceptable to the Agent.”. 
 (f) Section 1.03
of the Credit Agreement is hereby amended by inserting immediately after (x) the words “clause (b) of such definition” appearing in the third line thereof and (y) the words “Asset Sale” appearing in the last line
thereof, the words “or Permitted MLP Transfer”. 
 (g) Effective upon the making of the Additional Term Loans on the Additional
Term Loan Closing Date, the table appearing in Section 2.11 (Repayment of Borrowings) of the Credit Agreement is hereby amended and restated in its entirety to read as follows: 
  

				
	 “Repayment Date
	  	Amount
	 March 31, 2007
	  	$	3,184,219
	 June 30, 2007
	  	$	3,184,219
	 September 30, 2007
	  	$	3,184,219
	 December 31, 2007
	  	$	3,184,219
	 March 31, 2008
	  	$	3,184,219
	 June 30, 2008
	  	$	3,184,219

				
	 “Repayment Date
	  	Amount
	 September 30, 2008
	  	$	3,184,219
	 December 31, 2008
	  	$	3,184,219
	 March 31, 2009
	  	$	3,184,219
	 June 30, 2009
	  	$	310,695,702
	 September 30, 2009
	  	$	310,695,702
	 December 31, 2009
	  	$	310,695,702
	 Term Loan Maturity Date
	  	$	310,695,703”.

 (h) Section 2.12 of the Credit Agreement is hereby amended by inserting immediately after the
words “Section 2.12(b)” appearing in the fifth line of paragraph (d) of such Section the words “and Section 2.24 in the case of prepayments of Term Loans in the circumstances described in such Sections”. 
 (i) Section 2.13(b) of the Credit Agreement is hereby amended by inserting immediately after the words “Asset Sale” appearing in the
second line thereof the words “, Permitted MLP Transfer or MLP Extraordinary Distribution”. 
 (j) Section 2.13(h) of the
Credit Agreement is hereby amended and restated in its entirety to read as follows: 
 “(h) Notwithstanding the
foregoing, any Term Lender may elect, by written notice to the Administrative Agent at least two Business Days prior to the applicable prepayment date (or such shorter period as may be acceptable to the Administrative Agent), to decline all (but not
less than all) of any mandatory prepayment of its Term Loans pursuant to this Section 2.13 (such declined amounts, the “Declined Proceeds”). Any Declined Proceeds shall be offered to the Term Lenders not so declining
such prepayment (with such Term Lenders having the right to decline any prepayment with Declined Proceeds in the same manner provided for in the previous sentence). To the extent such Term Lenders elect to decline their pro rata shares of such
Declined Proceeds, such remaining Declined Proceeds may be retained by the Borrower. Notwithstanding any provision herein to the contrary, nothing herein shall limit the Borrower’s ability to make optional prepayments in accordance with
Section 2.12.”. 
 (k) Section 2.21(a) is hereby amended by inserting immediately after the words “Section 2.12(b)
(with such assignment being deemed to be an optional prepayment for purposes of determining the applicability of Section 2.12(b))” appearing in the eleventh and twelfth lines of the first proviso to such Section the words “and
Section 2.24 (with such prepayment fee to be payable by the Borrower)”. 
 (l) Section 2.24 is hereby added to the Credit
Agreement to read in its entirety as follows: 
 “SECTION 2.24. Term Loan Repricing Protection. In the event that,
prior to the first anniversary of the Amendment No. 1 Effective Date, any Term Lender 

 
receives a Repricing Prepayment (as defined below), then, at the time thereof, the Borrower shall pay to such Term Lender a prepayment fee equal to 1.00% of
the amount of such Repricing Prepayment. As used herein, with respect to any Term Lender, a “Repricing Prepayment” is the amount of principal of the Term Loans of such Term Lender that is either (a) optionally prepaid by
the Borrower pursuant to Section 2.12 substantially concurrently with the incurrence by the Borrower or any Subsidiary of new term loans that have interest rate margins lower than the Applicable Percentage then in effect for the Term Loans so
prepaid or (b) received by such Term Lender as a result of the mandatory assignment of such Term Loans in the circumstances described in Section 2.21 following the failure of such Term Lender to consent to an amendment of this Agreement
that would have the effect of reducing the Applicable Percentage with respect to such Term Loans.”. 
 (m) Section 5.04(d) of the
Credit Agreement is hereby amended by inserting after the last parenthetical therein the following: 
 “(it being
understood and agreed that, any semi-annual Reserve Report delivered pursuant to this paragraph (d) shall not include Excess Reserve Value unless, and then only to the extent, the Borrower provides supporting information relating to such Excess
Reserve Value that is prepared by an Independent Engineering Firm in form and detail reasonably acceptable to the Administrative Agent)”. 
 (n) The following Section 5.09(d) of the Credit Agreement is hereby added to the Credit Agreement: 
 “(d)
Pledge, pursuant to the Guarantee and Collateral Agreement, all Equity Interests in Permitted MLPs and Permitted GPs owned by any Loan Party.”. 
 (o) Section 5.10 of the Credit Agreement is hereby amended by (i) deleting “40%” appearing in the fourth line thereof and substituting therefor “(i) 60%” and (ii) inserting at the
end of the sentence the words “and (ii) 40% of such projected PDP production on a rolling basis for the twelve calendar month period subsequent to the twelve calendar month period referred to in clause (i)”. 
 (p) Section 6.04 of the Credit Agreement is hereby amended by (i) changing the reference in paragraph (i) thereof to
paragraph “(h)” to paragraph “(i)” and the reference to “this paragraph (i)” to “this paragraph (j)”, (ii) relabeling the current paragraph (i) as paragraph (j), and
(iii) inserting the following new paragraph (i) immediately after paragraph (h): 
 “(i) investments consisting
of Equity Interests in Permitted MLPs and Permitted GPs received in connection with a Permitted MLP Transfer;”. 
 (q)
Section 6.05(a) of the Credit Agreement is hereby amended by (i) deleting the word “and” preceding the current clause (z) therein and substituting therefor “,”, (ii) changing the current clause references
“(x)”, “(y)” and “(z)” therein to “(w)”, “(x)” and “(y)”, respectively, and (iii) inserting immediately after the newly labeled clause (y) the words “and (z) the
Borrower and the Subsidiaries may make Permitted MLP Transfers”. 

 (r) Section 6.05(b) of the Credit Agreement is hereby amended by inserting after the words
“paragraph (a) above” appearing in the first line thereof the words “(other than a Permitted MLP Transfer)”. 
 (s)
Section 6.07 of the Credit Agreement is hereby amended by inserting after the words “Loan Parties” appearing in the second line thereof the words “or Permitted MLP Transfers”. 
 (t) Section 6.15(i) of the Credit Agreement is hereby amended by deleting the reference to “3.00” appearing in the second line thereof and
substituting therefor “2.50”. 
 SECTION 4. Representations and Warranties. To induce the other parties hereto to enter into
this Amendment, the Borrower represents and warrants to the Administrative Agent, the Collateral Agent and each of the Lenders that, as of the Amendment Effective Date: 
 (a) This Amendment has been duly authorized, executed and delivered by the Borrower and each of the Subsidiary Guarantors and the Credit Agreement, as amended hereby, constitutes a legal, valid and binding obligation
of the Borrower, and this Amendment constitutes a legal, valid and binding obligation of the Borrower and each Subsidiary Guarantor. 
 (b)
The representations and warranties set forth in Article III of the Credit Agreement and in each other Loan Document are true and correct in all material respects on and as of the Amendment Effective Date with the same effect as though made on and as
of the Amendment Effective Date, except to the extent such representations and warranties expressly relate to an earlier date (in which case such representations and warranties were true and correct in all material respects as of such earlier date).

 (c) No Default or Event of Default has occurred and is continuing. 
 SECTION 5. Other Agreements. The Lenders hereby acknowledge and agree that the Borrower may effect such future amendments to the Credit Agreement,
without the consent of any Lender (other than any consent of the Revolving Credit Lenders that may be required), in order to effect any of the following: 
 (a) increase the Revolving Credit Commitments by up to an aggregate of $25,000,000; and 
 (b) increase the
maximum L/C Exposure by up to $25,000,000. 
 SECTION 6. Effectiveness. (a) This Amendment shall become effective as of the date
first set forth above on the date (the “Amendment Effective Date”) that the Administrative Agent (or its counsel) shall have received counterparts of this Amendment that, when taken together, bear the signatures of the
Borrower, each Subsidiary Guarantor, the Administrative Agent, the Required Lenders, and each Additional Term Lender. 

 (b) The obligations of the Lenders with Additional Term Loan Commitments to make additional Term Loans
are subject to the satisfaction of each of the following conditions (the date on which such conditions are satisfied, the “Additional Term Loan Closing Date”): 
 (i) The Administrative Agent shall have received a notice of the Borrowing of the Additional Term Loans that satisfies the requirements of
Section 2.03 of the Credit Agreement. 
 (ii) The representations and warranties set forth in Article III of the Credit
Agreement and in each other Loan Document shall be true and correct in all material respects on and as of the date of such Borrowing with the same effect as though made on and as of such date, except to the extent such representations and warranties
expressly relate to an earlier date (in which case such representations and warranties were true and correct in all material respects as of such earlier date). 
 (iii)(A) The Borrower and each other Loan Party shall be in compliance with all the terms and provisions set forth herein, in the
Credit Agreement and in each other Loan Document on its part to be observed or performed at or prior to the time of such Borrowing, (B) the Borrower shall be in pro forma compliance with the covenants set forth in Sections 6.12, 6.13, 6.14 and
6.15 of the Credit Agreement as of the last day of the most recently ended fiscal quarter after giving effect to the making of the Additional Term Loans and (C) at the time of and immediately after such Borrowing, no Event of Default or Default
shall have occurred and be continuing. 
 (iv) The Administrative Agent shall have received, on behalf of itself and the
Lenders, a favorable written opinion of (A) Jackson Walker L.L.P., counsel for the Borrower and (B) from each local counsel listed on Schedule II hereto, in each case (x) dated the Additional Term Loan Closing Date, (y) addressed
to the Administrative Agent and the Lenders and (z) covering such other matters relating to this Amendment and the transactions contemplated hereby as the Administrative Agent shall reasonably request and otherwise in form and substance
reasonably satisfactory to the Administrative Agent, and the Borrower hereby requests such counsel to deliver such opinions. 
 (v) All legal matters incident to this Amendment, to the borrowing of the Additional Term Loans and the Refinancing shall be satisfactory to the Lenders and to the Administrative Agent. 
 (vi) The Administrative Agent shall have received (A) a certificate, dated the Additional Term Loan Closing Date and signed by the
Secretary or Assistant Secretary of each Loan Party, certifying that (1) except as set forth 

 
on any schedule attached thereto, the certificate or articles of incorporation of such Loan Party previously delivered on the Original Closing Date (or such
later date on which such person became a Loan Party) have not been amended since the date of such delivery, (2) except as set forth on any schedule attached thereto, the by-laws of such Loan Party as in effect and delivered on the Original
Closing Date (or such later date on which such person became a Loan Party) have not been amended since the date of such delivery, (3) attached thereto is a true and complete copy of resolutions duly adopted by the Board of Directors or other
equivalent governing body of such Loan Party authorizing the execution, delivery and performance of this Amendment and, in the case of the Borrower, the borrowing of the Additional Term Loans, the Refinancing, and payment of any fees and expenses
incident to the preceding actions authorized by such resolutions, and that such resolutions have not been modified, rescinded or amended and are in full force and effect, (4) attached thereto is a certificate as to the good standing of such
Loan Party as of a recent date by the Secretary of State (or other similar official) of the jurisdiction of its organization, and (5) as to the incumbency and specimen signature of each officer executing this Amendment or any other document
delivered in connection herewith on behalf of such Loan Party; (B) a certificate of another officer as to the incumbency and specimen signature of the Secretary or Assistant Secretary executing the certificate pursuant to clause (A) above;
and (C) such other documents as the Lenders or the Administrative Agent may reasonably request. 
 (vii) The
Administrative Agent shall have received a certificate, dated the Additional Term Loan Closing Date and signed by a Financial Officer of the Borrower, confirming compliance with the conditions precedent set forth in paragraphs (ii) and
(iii) of this Section 6(b). 
 (viii) The Administrative Agent shall have received all fees and other amounts due
and payable on or prior to the Additional Term Loan Closing Date, including, to the extent invoiced, reimbursement or payment of all reasonable out-of-pocket expenses required to be reimbursed or paid by the Borrower hereunder or under any other
Loan Document. 
 (ix) The Security Documents shall be in full force and effect on the Additional Term Loan Closing Date (or,
in the case of Mortgages, on such date as the Borrower and Collateral Agent shall reasonably agree), and each document (including modifications to the Mortgages and the Foreign Pledge Agreements reflecting, among other things, the making of the
Additional Term Loans) required by law or reasonably requested by the Collateral Agent to be filed, registered or recorded in order to create or continue in favor of the Collateral Agent for the benefit of the Secured Parties a valid, legal and
perfected first-priority Lien on, and security interest in, the Collateral (subject to any Liens expressly permitted by Section 6.02 of the Credit Agreement) shall have been delivered to the Collateral Agent. The Pledged Collateral (as defined
in the Guarantee and Collateral Agreement) and the Foreign Pledged 

 
Collateral shall be duly and validly pledged under the Guarantee and Collateral Agreement or the applicable Foreign Pledge Agreement, as the case may be, to
the Collateral Agent for the benefit of the Secured Parties, and certificates representing such Pledged Collateral and Foreign Pledged Collateral (to the extent certificated), in each case accompanied by instruments of transfer and stock powers
endorsed in blank, shall have been delivered to the Collateral Agent (or in the case of any uncertificated Foreign Pledged Collateral, arrangements consistent with applicable local law and reasonably satisfactory to the Collateral Agent in respect
thereof shall have been implemented). 
 (x) The Collateral Agent shall have received a certificate, dated the Additional Term
Loan Closing Date and signed by a Responsible Officer of the Borrower, certifying that, except as set forth on any schedule attached thereto, the information set forth on the Perfection Certificate is complete, correct and accurate as of the
Additional Term Loan Closing Date. 
 (xi) The Administrative Agent shall have received a pay-off letter reasonably
satisfactory to it in respect of the Refinancing. 
 SECTION 7. Effect of Amendment. Except as expressly set forth herein, this
Amendment shall not by implication or otherwise limit, impair, constitute a waiver of, or otherwise affect the rights and remedies of the Lenders, the Collateral Agent or the Administrative Agent under the Credit Agreement or any other Loan
Document, and shall not alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Credit Agreement or any other Loan Document, all of which are ratified and affirmed in all respects
and shall continue in full force and effect. Nothing herein shall be deemed to entitle any Loan Party to a consent to, or a waiver, amendment, modification or other change of, any of the terms, conditions, obligations, covenants or agreements
contained in the Credit Agreement or any other Loan Document in similar or different circumstances. This Amendment shall apply and be effective only with respect to the provisions of the Credit Agreement specifically referred to herein. After the
date hereof, any reference to the Credit Agreement shall mean the Credit Agreement, as modified hereby. This Amendment shall constitute a “Loan Document” for all purposes of the Credit Agreement and the other Loan Documents. 
 SECTION 8. Counterparts. This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed and delivered shall be deemed an original, but all such counterparts together shall constitute but one and the same contract. Delivery of an executed counterpart of a signature page of this Amendment by facsimile
transmission shall be as effective as delivery of a manually executed counterpart hereof. 
 SECTION 9. Applicable Law. THIS AMENDMENT
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. 

 SECTION 10. Headings. The headings of this Amendment are for purposes of reference only and shall
not limit or otherwise affect the meaning hereof. 
 SECTION 11. Expenses. The Borrower agrees to reimburse the Administrative Agent
for all reasonable out-of-pocket expenses incurred in connection with this Amendment, including the reasonable fees, charges and disbursements of Cravath, Swaine & Moore LLP, counsel for the Administrative Agent. 
 SECTION 12. Acknowledgment of Subsidiary Guarantors. Each of the Subsidiary Guarantors hereby acknowledges receipt and notice of, and consents to
the terms of, this Amendment, and affirms and confirms its guarantee of the Obligations and, if applicable, the pledge of and/or grant of a security interest in its assets as Collateral to secure the Obligations, all as provided in the Guarantee and
Collateral Agreement and the other Security Documents, and acknowledges and agrees that such guarantee, pledge and/or grant of security interest continue in full force and effect in respect of, and to secure, the Obligations under the Credit
Agreement, as amended hereby, and the other Loan Documents and that such Obligations shall include all Obligations in respect of the Additional Term Loans. 
 [Remainder of page intentionally left blank] 

 IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed by their respective
authorized officers as of the day and year first above written. 
  

			
	ATP OIL & GAS CORPORATION,
		
	By	 	  

	Name:	 	
	Title:	 	
	
	ATP ENERGY, INC.,
		
	By	 	  

	Name:	 	
	Title:	 	

			
	 CREDIT SUISSE, CAYMAN ISLANDS
 BRANCH,
individually, as an Additional Term
 Lender, and as Administrative Agent and
 Collateral Agent,

		
	By	 	  

	Name:	 	
	Title:	 	
		
	By	 	  

	Name:	 	
	Title:	 	

 SIGNATURE PAGE TO 
 AMENDMENT NO. 1 AND AGREEMENT 
 TO ATP OIL & GAS CORPORATION 
 THIRD AMENDED AND 
 RESTATED CREDIT AGREEMENT

  

			
	Name of Lender:	 	  

			
		
	By	 	  

	Name:	 	
	Title:	 	

 SCHEDULE I 
 LENDERS AND ADDITIONAL TERM LOAN COMMITMENT 
  

				
	 Additional Term Lender
	  	 Additional Term
 Loan Commitment

	 Credit Suisse
	  	$	375,000,000
		
	 Total
	  	$	375,000,000

 SCHEDULE II 
 LOCAL COUNSEL 
 Onebane Law Firm 
 102 Versailles Blvd., Suite 600 
 Lafayette, Louisiana 70501 
 P. O. Box 3507 
 Lafayette, Louisiana 70502 
 Slaughter
and May 
 1 Bunhill Row 
 London 
 EC1Y 8YY 
 United KingdomEmployment Agreement

 Exhibit 10(xiv) 
 STATE OF NORTH CAROLINA 
 COUNTY OF GUILFORD 
 EMPLOYMENT AGREEMENT 
 THIS AGREEMENT entered into as of March 13, 2007 by
and between CAROLINA BANK (hereinafter referred to as the “Bank”) and DANIEL D. HORNFECK (hereinafter referred to as “Employee”). 
 W I T N E S S E T H: 
 WHEREAS, the expertise and experience of Employee and his relationships
and reputation in the financial institutions industry are extremely valuable to the Bank; and 
 WHEREAS, it is in the best interests
of the Bank to maintain an experienced and sound management team to manage the Bank and to further the Bank’s overall strategies to protect and enhance the value of its shareholders’ investments; and 
 WHEREAS, the Bank and Employee desire to enter into this Agreement to establish the scope, terms and conditions of Employee’s employment by
the Bank; and 
 WHEREAS, the Bank and Employee desire to enter into this Agreement also to provide Employee with security in the
event of a change in control in the Bank or its parent holding company, Carolina Bancshares, Inc. and to insure the continued loyalty of Employee during any such change in control in order to maximize shareholder value as well as the continued safe
and sound operation of the Bank. 
 NOW, THEREFORE, for and in consideration of the premises and mutual promises, covenants and
conditions hereinafter set forth, and other good and valuable considerations, the receipt and sufficiency of which hereby are acknowledged, the Bank and Employee hereby agree as follows: 
 1. Employment. The Bank hereby agrees to employ Employee, and Employee hereby agrees to serve as an officer of the Bank, all upon the terms
and conditions stated herein. As an officer of the Bank, Employee will (i) serve as Executive Vice President and Chief Credit Officer of the Bank, and (ii) have such other duties and responsibilities, and render to the Bank such other
management services, as are customary for persons in Employee’s position with the Bank or as shall otherwise be reasonably assigned to him from time to time by the Bank. Employee shall faithfully and diligently discharge his duties and
responsibilities under this Agreement and shall use his best efforts to implement the policies established by the Bank. 

 
Employee hereby agrees to devote such number of hours of his working time and endeavors to the employment granted hereunder as Employee and the Bank shall
deem to be necessary to discharge his duties hereunder, and, for so long as employment hereunder shall exist, Employee shall not engage in any other occupation which requires a significant amount of Employee’s personal attention during the
Bank’s regular business hours or which otherwise interferes with Employee’s attention to or performance of his duties and responsibilities as an officer of the Bank hereunder except with the prior written consent of the Bank. However,
nothing herein contained shall restrict or prevent Employee from personally, and for Employee’s own account, trading in stocks, bonds, securities, real estate or other forms of investment for Employee’s own benefit so long as said
activities do not interfere with Employee’s attention to or performance of his duties and responsibilities as an officer of the Bank hereunder. 
 During the term of this Agreement, Employee shall be allowed, in his sole discretion, to maintain his primary work location in Guilford County, North Carolina. 
 2. Compensation. For all services rendered by Employee to the Bank under this Agreement, the Bank shall pay Employee a base salary at a
rate of One Hundred Sixteen Thousand and Thirty Dollars and 00/100’s ($116,030.00) per annum; provided that the rate of such salary shall be reviewed by the Board of Directors not less often than annually. Salary paid under this
Agreement shall be payable in cash not less frequently than monthly. All compensation hereunder shall be subject to customary withholding taxes and such other employment taxes as are required by law. In the event of a Change in Control (as defined
in Paragraph 8), Employee’s base salary shall be increased not less than six percent (6%) annually during the term of this Agreement. 
 In addition to the foregoing, Employee shall be entitled to receive cash bonuses on an annual basis during the term of this Agreement as may be determined by the Board of Directors of the Bank or its Compensation Committee. 
 3. Participation in Retirement and Employee Benefit Plans; Fringe Benefits. Subject to the terms and conditions of this Agreement, Employee
shall be entitled to participate in any and all employee benefit programs and compensation plans from time to time maintained by the Bank and available to all employees of the Bank, all in accordance with the terms and conditions (including
eligibility requirements) of such programs and plans of the Bank, resolutions of the Bank’s Board of Directors establishing such programs and plans, and the Bank’s normal practices and established policies regarding such programs and
plans. 

 In addition to the other compensation and benefits described in this Agreement, the Bank shall:

 (i) Provide Employee with three weeks of paid vacation leave notwithstanding the policy for the Bank for all other employees.

 (ii) The Bank shall assume payment of dues to a civic club of Employee’s choice provided that Employee shall be responsible
for all personal expenses for use of such club; 
 (iii) The Bank shall reimburse Employee for all reasonable expenses incurred by
him in the performance of his duties under this Agreement and documented to the reasonable satisfaction of the Bank pursuant to established policies; and 
 (iv) The Bank shall provide to Employee major medical insurance coverage, including health, term life, disability, and dental, at no cost to Employee, his spouse or dependent children which will be under
policies at least equivalent to the insurance coverage generally provided to active full-time employees of the Bank and to their spouses and dependent children from time to time. 
 4. Term. Unless sooner terminated as provided in this Agreement and subject to the right of either Employee or the Bank to terminate
Employee’s employment at any time as provided herein, the initial term of this Agreement and Employee’s employment with the Bank hereunder shall be for a period commencing on the date hereof and continuing for a period of three
(3) years. At the end of each year of this Agreement, the term of this Agreement shall automatically be extended for an additional one year period unless written notice from the Bank or Employee is received thirty (30) days prior to such
date notifying the other party that this Agreement shall not be further extended. 
 5. Confidentiality; Noncompetition.
Employee hereby acknowledges and agrees that (i) in the course of his service as an officer of the Bank, he will gain substantial knowledge of and familiarity with the Bank’s customers and its dealings with them, and other information
concerning the Bank’s business, all of which constitutes valuable assets and privileged information that is particularly sensitive due to the fiduciary responsibilities inherent 

 
in the banking business; and, (ii) in order to protect the Bank’s interest in and to assure it the benefit of its business, it is reasonable and
necessary to place certain restrictions on Employee’s ability to compete against the Bank and on his disclosure of information about the Bank’s business and customers. For that purpose, and in consideration of the Bank’s agreements
contained herein, Employee covenants and agrees as provided below. 
 (a) Covenant Not to Compete. Employee will not
“Compete” (as defined below), directly or indirectly, with the Bank within a twenty-five (25) mile radius of any full service office of the Bank (the “Relevant Market”) as follows: 
 (i) if this Agreement is terminated by the Bank without “cause” (as defined in paragraph 6(d) hereof) Employee shall not “Compete”
for a period of time equal to the greater of twelve (12) months or the period of time Employee is receiving compensation pursuant to the terms of this Agreement; or 
 (ii) if this Agreement is terminated by Employee for any reason, Employee shall not “Compete” for a period of twelve (12) months from the date of termination of this Agreement by Employee. 

For the purposes of this Paragraph 5, the following terms shall have the meanings set forth below: 
 Compete. The term “Compete” means: (i) soliciting or securing deposits from any Person residing in the Relevant Market for
any Financial Institution; (ii) soliciting any Person residing in the Relevant Market to become a borrower from any Financial Institution, or assisting (other than through the performance of ministerial or clerical duties) any Financial
Institution in making loans to any such Person; (iii) including or attempting to induce any Person who was a Customer of the Bank on the date of termination of Employee’s employment with the Bank, to change such Customer’s depository,
loan and/or other banking relationship from the Bank to another Financial Institution; (iv) acting as a consultant, officer, director, independent contractor, organizer or employee of any Financial Institution that has its main or principal
office in the Relevant Market, or, in acting in any such capacity with any other Financial Institution, to maintain an office or be employed at or assigned to or to have any direct involvement in the management, business or operation of any office
of such Financial Institution located in the Relevant Market; or (v) communicating to any Financial Institution the names or addresses or any financial information concerning any Person who was a Customer of the Bank at the date of
Employee’s termination of this Agreement. 

 Customer. The term “Customer” means any Person with whom, as of the effective
date of termination of this Agreement or during Employee’s employment with the Bank, the Bank has or has had a depository, loan and/or other banking relationship. 
 Financial Institution. The term “Financial Institution” means any federal or state chartered bank or bank in organization, savings bank, savings and loan association or credit union, any
subsidiary thereof, or any holding company for or corporation that owns or controls any such entity, or any other Person engaged in the business of making loans of any type or receiving deposits, other than the Bank. 
 Person. The term “Person” means any natural person or any corporation, partnership, proprietorship, joint venture, limited
liability company, trust, estate, governmental agency or instrumentality, fiduciary, unincorporated association or other entity. 
 (b)
Confidentiality Covenant. Employee covenants and agrees that any and all data, figures, projections, estimates, lists, files, records, documents, manuals or other such materials or information (financial or otherwise) relating to the Bank
and its banking business, regulatory examinations, financial results and condition, lending and deposit operations, customers (including lists of the Bank’s customers and information regarding their accounts and business dealings with the
Bank), policies and procedures, computer systems and software, shareholders and employees (herein referred to as “Confidential Information”) are proprietary to the Bank and are valuable, special and unique assets of the Bank’s
business to which Employee will have access during his employment with the Bank. Employee agrees that (i) all such Confidential Information shall be considered and kept as the confidential, private and privileged records and information of the
Bank, and (ii) at all times during the term of his employment with the Bank and following the termination of this Agreement or his employment for any reason, and except as shall be required in the course of the performance by Employee of his
duties on behalf of the Bank or otherwise pursuant to the direct, written authorization of the Bank, Employee will not: divulge any such Confidential Information to any other Person or Financial Institution; remove any such Confidential Information
in written or other recorded form from the Bank’s premises; or make any use of any Confidential Information for his own purposes or for the benefit of any Person or Financial Institution other than the Bank. However, 

 
following the termination of Employee’s employment with the Bank, this subparagraph (b) shall not apply to any Confidential Information which then
is in the public domain (provided that Employee was not responsible, directly or indirectly, for permitting such Confidential Information to enter the public domain without the Bank’s consent), or which is obtained by Employee from a third
party which or who is not obligated under an agreement of confidentiality with respect to such information. 
 (c) Remedies for
Breach. Employee understands and agrees that a breach or violation by him of the covenants contained in Paragraph 5(a) and 5(b) of this Agreement will be deemed a material breach of this Agreement and will cause irreparable injury to the
Bank, and that it would be difficult to ascertain the amount of monetary damages that would result from any such violation. In the event of Employee’s actual or threatened breach or violation of the covenants contained in Paragraph 5(a) or
5(b), the Bank shall be entitled to bring a civil action seeking an injunction restraining Employee from violating or continuing to violate those covenants or from any threatened violation thereof, or for any other legal or equitable relief relating
to the breach or violation of such covenant. Employee agrees that, if the Bank institutes any action or proceeding against Employee seeking to enforce any of such covenants or to recover other relief relating to an actual or threatened breach or
violation of any of such covenants, Employee shall be deemed to have waived the claim or defense that the Bank has an adequate remedy at law and shall not urge in any such action or proceeding the claim or defense that such a remedy at law exists.
However, the exercise by the Bank of any such right, remedy, power or privilege shall not preclude the Bank or its successors or assigns from pursuing any other remedy or exercising any other right, power or privilege available to it for any such
breach or violation, whether at law or in equity, including the recovery of damages, all of which shall be cumulative and in addition to all other rights, remedies, powers or privileges of the Bank. 
 Notwithstanding anything contained herein to the contrary, Employee agrees that the provisions of Paragraph 5(a) and 5(b) above and the remedies
provided in this Paragraph 5(c) for a breach by Employee shall be in addition to, and shall not be deemed to supersede or to otherwise restrict, limit or impair the rights of the Bank under the Trade Secrets Protection Act contained in Article 24,
Chapter 66 of the North Carolina General Statutes, or any other state or federal law or regulation dealing with or providing a remedy for the wrongful disclosure, misuse or misappropriation of trade secrets or other proprietary or confidential
information. 

 (d) Survival of Covenants. Employee’s covenants and agreements and the Bank’s
rights and remedies provided for in this Paragraph 5 shall survive any termination of this Agreement or Employee’s employment with the Bank. 
 6. Termination and Termination Pay. 
 (a) Employee’s employment under this Agreement may be terminated at
any time by Employee upon ninety (90) days written notice to the Bank. Upon such termination, Employee shall be entitled to receive compensation through the effective date of such termination; provided, however, that the Bank, in its sole
discretion, may elect for Employee not to serve out part or all of said notice period. 
 (b) Employee’s employment under this
Agreement shall be terminated upon the death of Employee during the term of this Agreement. Upon any such termination, Employee’s estate shall be entitled to receive any compensation due to Employee computed through the last day of the calendar
month in which his death shall have occurred but which remains unpaid. 
 (c) In the event Employee becomes disabled during the term
of his employment hereunder and it is determined by the Bank that Employee is permanently unable to perform his duties under this Agreement, the Bank shall continue to compensate Employee at the level of compensation described in Paragraph 2 above,
and shall continue to provide Employee each of the other benefits set forth or described in this Agreement, for the remaining term of this Agreement, less any other payments provided under any disability income plan of the Bank which is applicable
to Employee. In the event of any disagreement between Employee and the Bank as to whether Employee is physically or mentally incapacitated such as will result in the termination of Employee’s employment pursuant to this Paragraph 6(c), the
question of such incapacity shall be submitted to an impartial and reputable physician for determination, selected by mutual agreement of Employee and the Bank or, failing such agreement, by two (2) physicians (one (1) of whom shall be
selected by the Bank and the other by Employee), and such determination of the question of such incapacity by such physician or physicians shall be final and binding on Employee and the Bank. The Bank shall pay the reasonable fees and expenses of
such physician or physicians in making any determination required under this Paragraph 6(c) . 

 (d) The Bank may terminate Employee’s employment at any time for any reason with or without
“Cause” (as defined below), but any termination by the Bank other than termination for “Cause”, (as defined below) shall not prejudice Employee’s right to compensation or other benefits under this Agreement for a period of
time equal to the balance of the term of this Agreement. Following any termination of Employee’s employment by the Bank for “Cause”, Employee shall have no further rights under this Agreement (including any right to receive
compensation or other benefits for any period after such termination). 
 For purposes of this Paragraph 6(d), the Bank shall have
“Cause” to terminate Employee’s employment upon: 
 (i) A determination by the Bank, in good faith, that Employee
(A) has breached in any material respect any of the terms or conditions of this Agreement, or (B) is engaging or has engaged in willful misconduct or conduct which is detrimental to the business prospects of the Bank or which
has had or likely will have a material adverse effect on the Bank’s business or reputation. Prior to any termination by the Bank of Employee’s employment for a breach, failure to perform or conduct described in this subparagraph (i), the
Bank shall give Employee written notice which describes such breach, failure to perform or conduct and if during a period of five (5) business days following such notice Employee cures or corrects the same to the reasonable satisfaction of the
Bank, then this Agreement shall remain in full force and effect. However, notwithstanding the above, if the Bank has given written notice to Employee on a previous occasion of the same or a substantially similar breach, failure to perform or
conduct, or of a breach, failure to perform or conduct which the Bank determines in good faith to be of substantially similar import, or if the Bank determines in good faith that the then current breach, failure to perform or conduct is not
reasonably curable, then termination under this subparagraph (i) shall be effective immediately and Employee shall have no right to cure such breach, failure to perform or conduct. 
 (ii) The violation by Employee of any applicable federal or state law, or any applicable rule, regulation, order or statement of policy
promulgated by any governmental agency or authority having jurisdiction over the Bank or any of its affiliates or subsidiaries (a “Regulatory Authority”, including without limitation the Federal Deposit Insurance Corporation, the North
Carolina Commissioner of Banks, the Federal Reserve Board or any other banking regulator having legal jurisdiction over the Bank), which results from 

 
Employee’s gross negligence, willful misconduct or intentional disregard of such law, rule, regulation, order or policy statement and results in any
substantial damage, monetary or otherwise, to the Bank or any of its affiliates or subsidiaries or to the Bank’s reputation; 
 (iii) The commission in the course of Employee’s employment with the Bank of an act of fraud, embezzlement, theft or proven personal dishonesty (whether or not resulting in criminal prosecution or conviction); 
 (iv) The conviction of Employee of any felony or any criminal offense involving dishonesty or breach of trust, or the occurrence of any event
described in Section 19 of the Federal Deposit Insurance Act or any other event or circumstance which disqualifies Employee from serving as an employee or officer of, or a party affiliated with, the Bank or any of its affiliates or
subsidiaries; 
 (v) Employee becomes unacceptable to, or is removed, suspended or prohibited from participating in the conduct of
the Bank’s affairs (or if proceedings for that purpose are commenced) by any Regulatory Authority; and, 
 (vi) The occurrence
of any event believed by the Bank, in good faith, to have resulted in Employee being excluded from coverage, or having coverage limited as to Employee as compared to other covered officers or employees, under the Bank’s then current
“blanket bond” or other fidelity bond or insurance policy covering its directors, officers or employees. 
 7. Additional
Regulatory Requirements. Notwithstanding anything contained in this Agreement to the contrary, it is understood and agreed that the Bank (or its successors in interest) shall not be required to make any payment or take any action under this
Agreement if (a) the Bank is declared by any Regulatory Authority to be insolvent, in default or operating in an unsafe or unsound manner, or if (b) in the opinion of counsel to the Bank such payment or action
(i) would be prohibited by or would violate any provision of state or federal law applicable to the Bank, including without limitation the Federal Deposit Insurance Act, the Federal Reserve Act and Chapter 53 of the North Carolina
General Statutes as now in effect or hereafter amended, (ii) would be prohibited by or would violate any applicable rules, regulations, orders or statements of policy, whether now existing or hereafter promulgated, of any Regulatory
Authority, or (iii) otherwise would be prohibited by any Regulatory Authority. 

 8. Change in Control 
 (a) In the event of a “Change in Control” (as defined in Subparagraph (d) below), of the Bank or its holding company, Carolina Bank
Holdings, Inc. (“Holdings”), Employee shall be entitled to terminate this Agreement upon the occurrence within twelve (12) months following a change in control of any Termination Event as defined in Subparagraph (b) below.

 (b) A Termination Event shall mean the occurrence of any of the following events: 
 (i) Employee is assigned any duties and/or responsibilities that are inconsistent with his position, duties, responsibilities, or status at the
time of the Change in Control or with his reporting responsibilities or titles with the Bank in effect at such time; 
 (ii)
Employee’s annual base salary is reduced below the amount in effect as of the effective date of a Change in Control or as the same shall have been increased from time to time following such effective date; 
 (iii) Employee’s life insurance, major medical insurance, disability insurance, dental insurance, stock option plans, stock purchase plans,
deferred compensation plans, management retention plans, retirement plans, or similar plans or benefits being provided by the Bank to Employee as of the effective date of the Change in Control are reduced in their level, scope, or coverage, or any
such insurance, plans, or benefits are eliminated, unless such reduction or elimination applies proportionately to all salaried employees of the Bank who participated in such benefits prior to such Change in Control; or 
 (iv) Employee is transferred to a location outside of Guilford County, North Carolina, without Employee’s express written consent.

 A Termination Event shall be deemed to have occurred on the date such action or event is implemented or takes effect. 
 (c) In the event that Employee terminates this Agreement or the Bank terminates this Agreement pursuant to this Paragraph 8, the Bank will be
obligated to pay or cause to be paid to Employee all amounts due and owing to the end of the term of this Agreement and an amount equal to two hundred ninety-nine percent (299%) of Employee’s “base amount” as defined in
Section 28OG(b) (3) (A) of the Internal Revenue Code of 1986, as amended (the “Code”) . 

 (d) For the purposes of this Agreement, the term Change in Control shall mean any of the
following events: 
 (i) After the effective date of this Agreement, any “person” (as such term is defined in Section 7
(j) (8) (A) of the Change in Bank Control Act of 1978) , directly or indirectly, acquires beneficial ownership of voting stock, or acquires irrevocable proxies or any combination of voting stock and irrevocable proxies, representing
twenty-five percent (25%) or more of any class of voting securities of Holdings or the Bank, or acquires control of in any manner the election of a majority of the directors of Holdings or the Bank; 
 (ii) The Bank or Holdings consolidates or merges with or into another corporation, association, or entity, or is otherwise reorganized, where
neither the Bank nor holdings is the surviving corporation in such transaction; or 
 (iii) All or substantially all of the assets of
the Bank or Holdings are sold or otherwise transferred to or are acquired by any other corporation, association, or other person, entity, or group. 
 Notwithstanding the other provisions of this Paragraph 8, a transaction or event shall not be considered a Change in Control (i) if, prior to the consummation or occurrence of such transaction or event, Employee
and the Bank agree in writing that the same shall not be treated as a Change in Control for purposes of this Agreement. 
 (e)
Amounts payable pursuant to this Paragraph 8 shall be paid, at the option of Employee either in one lump sum or in equal monthly payments over the remaining term of this Agreement. 
 (f) Following a Termination Event which gives rise to Employee’s rights hereunder, Employee shall have twelve (12) months from the date
of occurrence of the Termination Event to terminate this Agreement pursuant to this Paragraph 8. Any such termination shall be deemed to have occurred only upon delivery to the Bank or any successor thereto, of written notice of termination which
describes the Change in Control and Termination Event. If Employee does not so terminate this Agreement within such twelve month period, Employee shall thereafter have no further rights hereunder with respect to that Termination Event, but shall
retain rights, if any, hereunder with respect to any other Termination Event as to which such period has not expired. 

 (g) It is the intent of the parties hereto that all payments made pursuant to this Agreement be
deductible by the Bank for federal income tax purposes and not result in the imposition of an excise tax on Employee. Notwithstanding anything contained in this Agreement to the contrary, any payments to be made to or for the benefit of Employee
which are deemed to be “parachute payments” as that term is defined in Section 28OG(b) (2) of the Code, shall be modified or reduced to the extent deemed to be necessary by the Bank’s Board of Directors to avoid the
imposition of an excise tax on Employee under Section 4999 of the Code or the disallowance of a deduction to the Bank under Section 28OG(a) of the Code. 
 (h) In the event any dispute shall arise between Employee and the Bank as to the terms or interpretation of this Agreement, including this Paragraph 8, whether instituted by formal legal proceedings or
otherwise, including any action taken by Employee to enforce the terms of this Paragraph 8 or in defending against any action taken by the Bank, the Bank shall reimburse Employee for all costs and expenses, proceedings or actions, in the event
Employee prevails in any such action. 
 9. Successors and Assigns. 
 (a) This Agreement shall inure to the benefit of and be binding upon any corporate or other successor of the Bank which shall acquire, directly or
indirectly, by conversion, merger, share exchange, purchase or otherwise, all or substantially all of the assets of the Bank. 
 (b)
The Bank is contracting for the unique and personal skills of Employee. Therefore, Employee shall be precluded from assigning or delegating his rights or duties hereunder without first obtaining the written consent of the Bank. 
 10. Modification; Waiver; Amendments. No provision of this Agreement may be modified, waived or discharged unless such waiver, modification
or discharge is agreed to in writing and signed by the parties hereto. No waiver by either party hereto, at any time, of any breach by the other party hereto of, or compliance with, any condition or provision of this Agreement to be performed by
such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. No amendments or additions to this Agreement shall be binding unless in writing and signed by both parties,
except as herein otherwise provided. 

 11. Applicable Law. This Agreement shall be governed in all respects whether as to
validity, construction, capacity, performance or otherwise, by the laws of North Carolina, except to the extent that federal law shall be deemed to apply. 
 12. Severability. The provisions of this Agreement shall be deemed severable and the invalidity or unenforceability of any provision shall not affect the validity or enforceability of the other
provisions hereof. 
 13. Entire Agreement. This Agreement contains the entire agreement of the parties with respect to
the transactions described herein and supersedes any and all other oral or written agreements heretofore made, and there are no representations or inducements by or to, or any agreements between, any of the parties hereto other than those contained
herein in writing. 
 14. Compliance with Internal Revenue Code Section 409A. The Bank and Employee 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 Employee’s employment terminates Employee is a specified employee, as defined in section 409A of the Internal
Revenue Code of 1986, and if any payments under this Agreement will result in additional tax or interest to Employee because of section 409A, then despite any contrary provision of this Agreement Employee will not be entitled to the payments until
the earliest of (x) the date that is at least six months after termination of Employee’s employment for reasons other than Employee’s death, (y) the date of Employee’s death, or (z) any earlier date that does not result
in additional tax or interest to Employee 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 Employee in a single
lump sum, unless regular monthly installment payments beginning after a six-month delay are specifically provided for in this Agreement. 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 Employee to additional tax or interest under section 409A, the Bank shall reform the provision. However, the Bank shall maintain
to the maximum extent practicable the original intent of the applicable provision without subjecting Employee to additional tax or interest, and the Bank shall not be required to incur any additional compensation expense as a result of the reformed
provision. 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.

 IN WITNESS WHEREOF, the parties have executed this Agreement under seal and in such form as to be
binding as of the day and year first hereinabove written. 
  

			
	 CAROLINA BANK

		
	 By:
	 	 /s/ Robert T. Braswell

		 	Robert T. Braswell
		 	President and Chief Executive Officer

  

	
	 ATTEST:

	
	 /s/ T. Allen Liles

	                                      
                                       ,
 Secretary

  

	
	 /s/ Daniel D. Hornfeck

	Daniel D. Hornfeck

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