AMENDED AND RESTATED DIRECTOR SUPPLEMENTAL RETIREMENT AGREEMENT

Exhibit 10(n)

AMENDED AND RESTATED

DIRECTOR SUPPLEMENTAL RETIREMENT AGREEMENT

THIS AGREEMENT, made and entered into this      day of          , 2008, by and between Peoples Bank, a bank organized and existing under the laws of the State of North Carolina (hereinafter referred to as the "Bank"), and          member of the Board of Directors of the Bank (hereinafter referred to as the "Director").

W I T N E S S E T H:

WHEREAS, the Bank and the Director entered a Director Supplemental Retirement Plan Director Agreement dated the 1st day of January, 2002 between Peoples Bank and James S. Abernethy that provides for the payment of certain benefits;

WHEREAS, the Bank and the Director thereafter entered into a Director Fee Continuation Agreement dated December 31, 2003 (the "2003 Agreement"), which replaced and superseded the Director Supplemental Retirement Plan Director Agreement dated January 1, 2002 and the benefits provided thereunder;

WHEREAS, it is the consensus of the Board of Directors (hereinafter referred to as the "Board") that the Director’s services to the Bank in the past have been of exceptional merit and have constituted an invaluable contribution to the general welfare of the Bank and in bringing it to its present status of operating efficiency, and its present position in its field of activity;

WHEREAS, the Director’s experience, knowledge of the affairs of the Bank, reputation, and contacts in the industry are so valuable that assurance of the Director’s continued services is essential for the future growth and profits of the Bank and it is in the best interests of the Bank to arrange terms of continued service for the Director so as to reasonably assure the Director’s remaining in the Bank’s service during the Director’s lifetime or until the age of retirement;

WHEREAS, it is the desire of the Bank that the Director’s services be retained as herein provided;

WHEREAS, the Director is willing to continue to serve the Bank provided the Bank agrees to pay the Director or the Director’s beneficiary(ies), certain benefits in accordance with the terms and conditions hereinafter set forth; and

WHEREAS, the Bank and the Director desire to amend and restate the 2003 Agreement in order to bring it into compliance with Section 409A of the Internal Revenue Code, as amended, including regulations and guidance issued thereunder ("Section 409A").

ACCORDINGLY, it is the desire of the Bank and the Director to enter into this Agreement under which the Bank will agree to make certain payments to the Director at retirement or the Director’s beneficiary(ies) in the event of the Director’s death pursuant to this Agreement;

FURTHERMORE, it is the intent of the parties hereto that this Agreement be considered an unfunded arrangement maintained primarily to provide supplemental retirement benefits for the Director, and to be considered a non-qualified benefit plan for purposes of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"). The Director is fully advised of the Bank’s financial status and has had substantial input in the design and operation of this benefit plan.

NOW, THEREFORE, in consideration of services performed in the past and to be performed in the future as well as of the mutual promises and covenants herein contained it is agreed as follows:

I. SERVICE

The Director will continue to serve the Bank in such capacity and with such duties and responsibilities as may be assigned, and with such compensation as may be determined from time to time by the Board of Directors of the Bank.

II. FRINGE BENEFITS

The fee continuation benefits provided by this Agreement are granted by the Bank as a fringe benefit to the Director and are not part of any fee reduction plan or an arrangement deferring a bonus or a fee increase. The Director has no option to take any current payment or bonus in lieu of these fee continuation benefits except as set forth hereinafter.

III. RETIREMENT DATE AND NORMAL RETIREMENT AGE

If the Director continuously serves the Bank, the Director shall retire from active service with the Bank on the December 31st nearest the Director’s seventieth (70th) birthday.

Normal Retirement Age shall mean the date on which the Director attains age seventy (70).

IV. RETIREMENT BENEFIT AND POST-RETIREMENT DEATH BENEFIT

Upon said retirement, the Bank, commencing with the first (1st) day of the month following the date of such retirement, shall pay the Director an annual benefit amount equal to Twelve Thousand and 00/100 Dollars ($12,000.00). Said benefit shall be paid in equal monthly installments (1/12th of the annual benefit) for a period of one hundred eighty (180) months; provided, that if less than one hundred eighty (180) of such monthly payments have been made prior to the death of the Director, the Bank shall make the total

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amount of said payments due in a lump sum reduced to present value as set forth in Subparagraph XI(K) to such individual or individuals as the Director may have designated in writing and filed with the Bank. Said payment shall be made on the first day of the second month following the death of the Director. In the absence of any effective beneficiary designation, any such amount becoming due and payable upon the death of the Director shall be payable to the duly qualified executor or administrator of the Director’s estate. Said payment shall be made on the first day of the second month following the death of the Director.

V. DEATH BENEFIT PRIOR TO RETIREMENT

In the event the Director should die while actively serving the Bank at any time after the date of this Agreement but prior to the Director attaining the age of seventy (70) years, the Bank will pay the balance of the Pre-Retirement Account in a lump sum reduced to present value as set forth in Subparagraph XI(K), to such individual or individuals as the Director may have designated in writing and filed with the Bank. Said payment shall be made on the first day of the second month following the death of the Director. In the absence of any effective beneficiary designation, any such amount becoming due and payable upon the death of the Director shall be payable to the duly qualified executor or administrator of the Director’s estate. Said payment shall be made on the first day of the second month following the death of the Director.

VI. BENEFIT ACCOUNTING

The Bank shall account for this benefit using the regulatory accounting principles of the Bank’s primary federal regulator and the Generally Accepted Accounting Principles. The Bank shall establish an accrued liability retirement account (a bookkeeping entry) for the Executive into which appropriate reserves shall be accrued.

VII. VESTING

Director’s interest in the benefits that are the subject of this Agreement shall be subject to a vesting schedule over the five (5) full years of service with the Bank from the date first elected to the Board of the Bank (to a maximum of 100%).

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VIII. OTHER TERMINATION OF SERVICE

Subject to Subparagraph VIII(ii) hereinbelow, should the Director suffer a Termination of Service, the Director shall be entitled to receive the vested balance of the accrued liability account paid to the Director in equal monthly installments (1/12th of the annual benefit) for a period of one hundred eighty (180) monthly installments commencing at the Normal Retirement Age [Subparagraph III(B)] accruing interest at the one-year Treasury Bill rate. Said payments will commence thirty (30) days following the Normal Retirement Age. Provided, however, that if the vested balance of the accrued liability account is $10,000 or less, the Director shall be paid the entire vested balance of the accrued liability account in a lump sum payment.

Should the Director die prior to having received the total amount of payments due, the unpaid balance shall be paid in a lump sum to such individual or individuals as the Director may have designated in writing and filed with the Bank. In the absence of any effective beneficiary designation, any such amounts becoming due and payable upon the death of the Director shall be payable to the duly qualified executor or administrator of the Director’s estate. Said payment hereunder shall be made on the first day of the second month following the death of the Director. If, upon death, the Director shall have received the total annual benefit as provided herein, then no further benefit shall be due hereunder.

(i) Termination of Service. Termination of Service shall be defined as voluntary resignation of service by the Director or the Bank’s discharge of the Director without cause ["cause" defined in Subparagraph (VIII)(ii) below], prior to the Normal Retirement Age (described in Subparagraph III(B)).

(ii) Discharge for Cause: In the event the Executive shall be discharged for cause at any time, all benefits provided herein shall be forfeited. The term "cause" includes termination because of the Director’s personal dishonesty, incompetence, willful misconduct, breach of duty involving personal profit, intentional failure to perform stated duties, willful violation of any law, rule or regulation (other than minor traffic violations or similar offenses), or final cease and desist order, or any material breach of any provision of this Agreement. Discharge for "cause" shall also include any termination pursuant to a resolution of the Board of Directors approved by a vote of at least eighty-five percent (85%) of directors entitled to vote, finding that termination ^- of the Director’s Agreement is in the best interests of the Bank or the Holding Company.

IX. CHANGE IN CONTROL

For purposes of this Agreement, the term "Change in Control" shall mean: (i) a Change of Ownership; (ii) a Change in Effective Control; or (iii) a Change of Asset Ownership; in each case, as defined herein and as further defined and interpreted in Section 409A.

(i) For purposes of this Paragraph IX, "Change in Effective Control" shall mean the date either (A) one person (or group) acquires (or has acquired during the proceeding twelve (12) months) ownership of stock of the Bank possessing thirty

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percent (30%) or more of the total voting power of the Bank’s stock or (B) a majority of the Bank’s board of directors is replaced during any twelve (12) month period by directors whose election is not endorsed by a majority of the members of the Bank’s board of directors prior to such election.

(ii) For purposes of this Paragraph IX, "Change of Asset Ownership" shall mean the date one person (or group) acquires (or has acquired during the preceding twelve (12) months) assets from the Bank that have a total gross fair market value that is equal to or exceeds forty percent (40%) of the total gross fair market value of all the Bank’s assets immediately prior to such acquisition.

(iii) For purposes of this Paragraph IX, "Change of Ownership" shall mean the date one person (or group) acquires ownership of stock of the Bank that, together with stock previously held, constitutes more than fifty percent (50%) of the total fair market value or total voting power of the stock of the Bank; provided that such person (or group) did not previously own fifty percent (50%) or more of the value or voting power of the stock of the Bank.

For purposes of determining whether the Bank has undergone a Change in Control under this Paragraph IX, the term Bank shall include any corporation that is a majority shareholder of the Bank within the meaning of Section 409A (owning more than fifty percent (50%) of the total fair market value and total voting power of the Bank).

Upon a Change in Control (as defined above), the Director shall become fully vested in and be entitled to receive the benefits promised in Subparagraph IV of this Agreement upon attaining Normal Retirement Age (Subparagraph III[B]), as if the Director had served the Bank until Normal Retirement Age. Payments will commence thirty (30) days following the Executive’s attainment of Normal Retirement Age. The Director will also remain eligible for all promised death benefits in this Agreement. In addition, no sale, merger, consolidation or conversion of the Bank shall take place unless the new or surviving entity expressly acknowledges the obligations under this Agreement and agrees to abide by its terms.

X. RESTRICTIONS ON FUNDING

The Bank shall have no obligation to set aside, earmark or entrust any fund or money with which to pay its obligations under this Agreement. The Directors, their beneficiary(ies), or any successor in interest shall be and remain simply a general creditor of the Bank in the same manner as any other creditor having a general claim for matured and unpaid compensation.

XI. MISCELLANEOUS

A. Alienability and Assignment Prohibition .

Neither the Director, nor the Director’s surviving spouse, nor any other beneficiary(ies) under this Agreement shall have any power or right to transfer, assign, anticipate, hypothecate, mortgage, commute, modify or otherwise encumber in advance any of the

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benefits payable hereunder nor shall any of said benefits be subject to seizure for the payment of any debts, judgments, alimony or separate maintenance owed by the Director or the Director’s beneficiary(ies), nor be transferable by operation of law in the event of bankruptcy, insolvency or otherwise. In the event the Director or any beneficiary attempts assignment, commutation, hypothecation, transfer or disposal of the benefits hereunder, the Bank’s liabilities shall forthwith cease and terminate.

B. Binding Obligation of the Bank and any Successor in Interest .

The Bank shall not merge or consolidate into or with another bank or sell substantially all of its assets to another bank, firm or person until such bank, firm or person expressly agrees, in writing, to assume and discharge the duties and obligations of the Bank under this Agreement. This Agreement shall be binding upon the parties hereto, their successors, beneficiaries, heirs and personal representatives.

C. Amendment or Revocation .

Subject to Paragraph XIV, it is agreed by and between the parties hereto that, during the lifetime of the Director, this Agreement may be amended or revoked at any time or times, in whole or in part, by the mutual written consent of the Director and the Bank. Amendment of this Agreement shall not be adopted if its adoption would be inconsistent with Section 409A. If an amendment to this Agreement is required by any future guidance or regulations issued pursuant to Section 409A, then the parties agree to adopt an amendment to bring the Agreement into compliance with Section 409A. The benefits provided under this Agreement shall not be subject to change, renegotiation, acceleration or deferral beyond the payment time set forth herein (the "Changes") except to the extent that the Changes comply with Section 409A at the time the parties agree to the Changes.

D. Gender .

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

E. Effect on Other Bank Benefit Plans .

Nothing contained in this Agreement shall affect the right of the Director to participate in or be covered by any qualified or non-qualified pension, profit-sharing, group, bonus or other supplemental compensation or fringe benefit plan constituting a part of the Bank’s existing or future compensation structure.

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F. Headings .

Headings and subheadings in this Agreement are inserted for reference and convenience only and shall not be deemed a part of this Agreement.

G. Applicable Law .

The validity and interpretation of this Agreement shall be governed by the laws of the State of North Carolina without respect to any choice-of-law or conflict-of-laws principles or provisions that would cause another jurisdiction’s laws to apply and except to the extent preempted by federal law.

H. 12 U.S.C. § 1828(k) .

Any payments made to the Director pursuant to this Agreement, or otherwise, are subject to and conditioned upon their compliance with 12 U.S.C. § 1828(k) or any regulations p