Parkway Acquisition Corp. (Form: 8-K, Received: 06/06/2019 14:43:01)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

___________

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) : June 1, 2019

___________

PARKWAY ACQUISITION CORP.

(Exact name of registrant as specified in its charter)

Virginia (State or other jurisdiction of incorporation)	333-209052 (Commission File Number)		47-5486027 (I.R.S. Employer Identification No.)

101 Jacksonville Circle Floyd, Virginia (Address of principal executive offices)		24091 (Zip Code)

Registrant’s telephone number, including area code: (540) 745-4191

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
None

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 5.02.

Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On June 1, 2019, Parkway Acquisition Corp. (the “Company”) entered into new agreements with certain of its executive officers, including a new employment agreement with Blake M. Edwards, the Company’s President and Chief Executive Officer, and change in control agreements with Rodney R. Halsey, the Company’s Executive Vice President and Chief Operations Officer, and Lorina C. Vaught, the Company’s Executive Vice President and Chief Financial Officer.

Employment Agreement with Blake M. Edwards

The executive employment agreement, dated June 1, 2019, between the Company and Mr. Edwards (the “Employment Agreement”) supersedes and replaces Mr. Edwards previous employment agreement dated November 22, 2017.

The term of Mr. Edwards’s employment under the Employment Agreement began on June 1, 2019 and will continue for a term of three years, unless terminated earlier in accordance with its terms. After the expiration of this initial term, the Employment Agreement will automatically extend for successive one-year periods, unless either Mr. Edwards or the Company elect not to so extend. The Employment Agreement provides for an initial base salary of $285,000 per year. Mr. Edwards will be eligible to be considered for incentive compensation, if any, in an amount determined appropriate by the Company based on the recommendation of the Compensation Committee of the Company’s Board of Directors. He is also entitled to participate in the Company's employee benefit plans and programs for which he is or will be eligible.

The Employment Agreement provides for the termination of Mr. Edwards's employment by the Company without “Cause” or by him for “Good Reason” in the absence of a “Change in Control” (as those terms are defined in the Employment Agreement). In such cases, Mr. Edwards will be entitled to receive his then-current base salary for the lesser of the remainder of the term or 18 months. The Employment Agreement also provides for the termination of Mr. Edwards's employment by the Company following a “Change in Control” or by him for “Good Reason” following a “Change in Control.” In such cases, Mr. Edwards will be entitled to receive, among other things, a lump sum amount equal to 2.99 times the sum of his base salary and highest annual bonus during the two years preceding the Change in Control. Mr. Edwards’s entitlement to the foregoing severance payments is subject to Mr. Edwards's release and waiver of claims against the Company and his compliance with certain restrictive covenants as provided in the Employment Agreement.

In the event that Mr. Edwards is terminated by the Company as a result of a “Permanent Disability” (as defined in the Employment Agreement), Mr. Edwards will be entitled to receive a lump sum payment equal to 90 days of his then-current base salary. Mr. Edwards will not be entitled to any compensation or other benefits under the Employment Agreement if his employment is terminated upon his death, by the Company for “Cause,” or by him in the absence of “Good Reason.”

The Employment Agreement contains restrictive covenants relating to the protection of confidential information, non-disclosure, non-competition and non-solicitation. The non-compete and non-solicitation covenants generally continue for a period of 24 months following the last day of Mr. Edwards’s employment.

The full text of the Employment Agreement is attached as Exhibit 10.1 to this report and is incorporated by reference into this Item 5.02.

Change in Control Agreement with Rodney R. Halsey

The change in control agreement, dated June 1, 2019, between the Company and Mr. Halsey (the “Halsey Agreement”) provides that if Mr. Halsey’s employment is terminated by the Company without “Cause” or by him for “Good Reason” within 12 months following a “Change in Control Event” (as those terms are defined in the Halsey Agreement), the Company will make a severance payment to Mr. Halsey equal to two times his annual base salary and, if Mr. Halsey elects COBRA continuation coverage under the Company’s health plan, the Company will pay premiums for up to eighteen months. Mr. Halsey’s entitlement to the foregoing severance payments is subject to his release and waiver of claims against the Company and his compliance with certain restrictive covenants as provided in the Halsey Agreement.

Subject to certain limited exceptions provided in the Halsey Agreement, the Company’s obligation to make severance payments under the Halsey Agreement expires on May 31, 2020.

The Halsey Agreement contains restrictive covenants relating to the protection of confidential information, non-disclosure, non-competition and non-solicitation. The non-compete and non-solicitation covenants generally continue for a period of 24 months following the last day of Mr. Halsey’s employment.

The full text of the Halsey Agreement is attached as Exhibit 10.2 to this report and is incorporated by reference into this Item 5.02.

Change in Control Agreement with Lorina C. Vaught

The change in control agreement, dated June 1, 2019, between the Company and Ms. Vaught (the “Vaught Agreement”) provides that if the Ms. Vaught’s employment is terminated by the Company without “Cause” or by her for “Good Reason” within 12 months following a “Change in Control Event” (as those terms are defined in the Vaught Agreement), the Company will make a severance payment to Ms. Vaught equal to her annual base salary and, if Ms. Vaught elects COBRA continuation coverage under the Company’s health plan, the Company will pay premiums for up to twelve months. Ms. Vaught’s entitlement to the foregoing severance payments is subject to her release and waiver of claims against the Company and her compliance with certain restrictive covenants as provided in the Vaught Agreement.

Subject to certain limited exceptions provided in the Vaught Agreement, the Company’s obligation to make severance payments under the Vaught Agreement expires on May 31, 2020.

The Vaught Agreement contains restrictive covenants relating to the protection of confidential information, non-disclosure, non-competition and non-solicitation. The non-compete and non-solicitation covenants generally continue for a period of 12 months following the last day of Ms. Vaught’s employment.

The full text of the Vaught Agreement is attached as Exhibit 10.3 to this report and is incorporated by reference into this Item 5.02.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

10.1

Executive Employment Agreement, dated June 1, 2019, between Parkway Acquisition Corp. and Blake M. Edwards

10.2

Change in Control Agreement, dated June 1, 2019, between Parkway Acquisition Corp. and Rodney R. Halsey

10.3

Change in Control Agreement, dated June 1, 2019, between Parkway Acquisition Corp. and Lorina C. Vaught

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	PARKWAY ACQUISITION CORP.
	(Registrant)


Date: June 6, 2019	By:	/s/ Blake M. Edwards
		Blake M. Edwards
		President and Chief Executive Officer

Exhibit 10.1

EXECUTIVE EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT made and entered into on the dates set forth below by and between BLAKE M. EDWARDS , hereinafter referred to as “ Executive ,” and PARKWAY ACQUISITION CORP., hereinafter referred to as “ Parkway .”

W I T N E S S E T H

WHEREAS, Parkway is a bank holding company which wholly owns the subsidiary bank, Skyline National Bank (the “ Bank ”) and other Affiliates (defined below);

WHEREAS , Executive is currently employed as the Chief Executive Officer and President of Parkway and the Bank; and

WHEREAS , the Parkway Board of Directors (the “ Board ”) recognizes the significant contributions which Executive has made during Executive’s tenure, and believes it to be in the best interests of the Corporation (as defined) to provide for stability in its senior management; and

WHEREAS, as of the Effective Date (as defined), this Agreement supersedes and replaces all employment and/or similar agreements previously entered into between Executive and Parkway including his Agreement dated November, 22, 2017.

NOW, THEREFORE, in consideration of the mutual covenants herein set forth and the benefits that have and will accrue to Executive from continued employment, Executive and Parkway agree as follows:

1. Definitions . The following words and terms shall have the meanings set forth below for the purposes of this Agreement.

(a) Affiliate . “Affiliate” means all Persons and Entities, directly or indirectly, controlling, controlled by or under common ownership with the Corporation (as defined) where control is by management authority, equity ownership, contract or otherwise. This term also includes Entities in which the Corporation may acquire ownership or control after Effective Date.

(b) Board . “Board” means the Board of Directors of Parkway Acquisition Corp. or its Successor.

(c) Cause . “Cause” means the termination of Executive’s employment prior to the expiration of the Term or any renewal term as a result of a finding by a two-thirds vote of the Board (as defined) (excluding Executive if he is a Board member) that any of the following have occurred: (i) Executive has engaged in or has directed others to engage in an act or omission, or series of actions, deemed to be fraudulent, dishonest or unlawful; (ii) any knowing and material breach of this Agreement by Executive; (iii) any knowing and material violation by Executive of corporate policies and procedures that result in damage to the business or reputation of the Corporation or its Successor, including, without limitation, the Bank’s Professional Code of Conduct, Code of Ethics, Conflict of Interest Policy or policies prohibiting discrimination, harassment and/or retaliation; (iv) Executive has engaged in, or has directed others to engage in, a criminal act (other than a minor traffic offense) or other willful misconduct determined to be substantially detrimental to the best interests of the Corporation or its Successor; (v) knowing breach of fiduciary duty by Executive; (vi) Executive fails to follow the directions of the Board, is grossly neglectful of Executive’s duties or continues to fail to perform assigned duties, which are not cured within twenty-one (21) days after the Board provides written notice of the issue; (vii) Executive engages in conduct which violates any material law, rule or standard of regulatory agencies governing any aspect of the Corporation’s operations, including but not limited to the Virginia Bureau of Financial Institutions, the Office of the Comptroller of the Currency, the U.S. Financial Stability Oversight Council, U.S. Treasury Department, Bureau of Consumer Financial Protection, and the Securities and Exchange Commission; or (viii) demonstrated incompetence of Executive.

(d) Change of Control . “Change of Control” means any one of the following events occurring after the Effective Date:

(i) any person or entity, including a “group” as defined in Section 13(d)(3) of the Securities Exchange Act of 1934, a wholly-owned subsidiary thereof, or any employee benefit plan of the Corporation or any of its subsidiaries becomes the beneficial owner of Corporation securities having fifty percent (50%) or more of the combined voting power of the then outstanding securities of the Corporation that may be cast for the election of directors of the Corporation or Bank (other than as a result of the issuance of securities initiated by the Corporation in the ordinary course of business);

(ii) as the result of, or in connection with, any cash tender or exchange offer, merger or other business combination, sale of assets or contested election, or any combination of the foregoing transactions, the holders of all Corporation’s securities entitled to vote generally in the election of directors of the Corporation immediately prior to such transaction constitute, following such transaction, less than a majority of the combined voting power of the then-outstanding securities of the Corporation or any of their respective successor corporations or entities entitled to vote generally in the election of the directors of Corporation or such other corporation or entity after such transactions; or

(iii) such other change of ownership or control event as defined in Treasury Regulation §1.409A-3(i)(5) or any subsequent, applicable Treasury Regulation.

(e) Competing Financial Services Organization . “Competing Financial Services Organization” means an entity unaffiliated with the Corporation or its Successor that is engaged in the commercial, retail or mortgage banking or lending business, wealth management business, investment advisory business, or trust service business that provides services and products that are the same as or competitive with the services and products offered by the Corporation or its Successor immediately prior to the Date of Termination or were approved by the Corporation or its Successor to be offered within ninety (90) days of the Date of Termination.

(f) Competitive Service or Product . “Competitive Service or Product” means those services or products offered by a Competing Financial Services Organization that are the same as or competitive with those services or products offered by the Corporation or its Successor at the Date of Termination or which have been approved by the Corporation, to be offered within ninety (90) days of th Date of Termination.

(g) Confidential Information . “Confidential Information” means all information, technical or financial data, materials, computer records or data, trade secrets and/or know-how regarding the Corporation or its Successor, or their internal operations and plans that is treated as confidential by the Corporation or its Successor, that is not generally known by persons not employed by the Corporation or its Successor, and that is not otherwise available to the public by lawful and proper means. Confidential Information also includes all information received from customers of the Bank or other Affiliates, along with the identity of and services provided to the customers, regardless of the manner which such information is conveyed or stored as well as information or materials designated or treated as confidential by a federal or state regulatory or enforcement agency Confidential Information includes, but is not limited to, strategic plans and forecasts; product or service plans or research; products, services and customer lists; marketing research, plans and/or forecasts; compilations and databases of customers, business or marketing information that are developed by or for the Corporation or its Successor; budget and/or financial information; customer contact, account and mailing information; pricing, costs or profitability analysis; sales and marketing techniques and programs; incentive compensation plans; account information (including loan terms, expiration or renewal dates, fee schedules and commissions); software, access codes, passwords, databases and source codes; inventions; processes, formulas, designs, drawings or engineering information; hardware configuration, and all other financial or other business information or systems of the Corporation or its Successor, as well as the following non-public and sensitive information regarding the employees of the Corporation or its Successor: Social Security numbers, date of birth, names of family members, home addresses and email addresses, telephone numbers, health-related information and compensation information. This definition applies to information generated by Executive or others who work for the Corporation or its Successor, as well as information received from a customer or another third party. This list is not exhaustive, and Confidential Information also includes other information that is identified, marked or treated as confidential or proprietary, or that would appear to a reasonable person to be confidential or proprietary in the context and circumstances in which the information is known or used. For purposes of this definition, the term “not available to the public” shall include all information or material in the public domain by virtue of improper disclosure by Executive or by another with his/her permission. Notwithstanding the foregoing, information shall not be considered Confidential Information if (i) such information is already known to others not bound by a duty of confidentiality with respect thereto, (ii) such information is or becomes publicly available through no fault of Executive, or (iii) the furnishing or use of such information is compelled by or in connection with legal or administrative proceedings.

(h) Corporation . “Corporation” means individually or collectively, as applicable, Parkway Acquisition Corp., its wholly-owned subsidiary Skyline National Bank, and all other Affiliates.

(i) Customer . “Customer” means a Person or Entity that has an account with, loan from, an investment or deposit with the Bank or any Affiliates, or that has received or used other financial or investment products or services from the Bank or any other Affiliates at any time within the twelve (12) months immediately prior to the Date of Termination.

(j) Date of Termination . “Date of Termination” means the date specified in the Notice of Termination or Executive’s date of Death as applicable. If either party fails to deliver a Notice of Termination, the Date of Termination means the last day of Executive’s employment with the Corporation.

(k) Effective Date . “Effective Date” means and this Agreement shall be effective as of June 1, 2019.

(l) Good Reason . “Good Reason” means Executive’s termination of employment as a result of (i) a material reduction in Executive’s duties, authorities, or reporting responsibilities, without Executive’s prior consent; (ii) a material breach of this Agreement by the Corporation or its Successor, including, without limitation, reducing Executive’s Base Salary, or failing to provide Executive with the compensation and benefits provided for under this Agreement; or (iii) the Corporation or its Successor requires Executive to move Executive’s principal location for work to a location that is 120 miles or more from the principal location where the Executive is then serving. Notwithstanding the foregoing, no event described in the preceding sentence shall give rise to a termination for Good Reason unless Executive first gives the Corporation notice that such an event has occurred within the sixty (60) days immediately following the occurrence of such event, and the Corporation fails to cure the breach within thirty (30) business days of such notice.

(m) Person/Entity . “Person” means any Entity or individual, and the heirs, executors, administrators, legal representatives, successors, and assigns of such “Person” where the context so permits. “Entity” means any general partnership, limited partnership, limited liability company, corporation, joint venture, trust, business trust, cooperative or association or any foreign trust or foreign business organization.

(n) Prospect . “Prospect” means a Person who has not previously done business with the Bank or any other Affiliate, but who had one or more communications with Executive within the six (6) months immediately before the end of employment with the Corporation where the Person applied for a loan, inquired about establishing an account or making an investment, or otherwise had discussions with Executive about utilizing or obtaining service(s) and/or product(s) offered by the Bank or another Affiliate.

(o) Notice of Termination . The term “Notice of Termination” means any written notice that Executive’s employment is being terminated given by the Corporation (or its Successor) or Executive for any reason which specifies a Date of Termination, which may be effective immediately.

(p) Separation from Service . The term “ Separation from Service” or “Separated from Service” means the termination, whether voluntary or involuntary, of Executive’s employment for reasons other than death. Whether a Separation from Service takes place is determined based on the facts and circumstances surrounding the termination of Executive’s employment and whether the Corporation (or its Successor) and Executive intended for Executive to provide significant services for the Corporation (or its Successor) following such termination. A termination of employment will not be considered a Separation from Service if the termination from employment is not considered a termination of employment under Treasury Regulation 1.409A-1(h)(1)(ii).

(q) Specified Executive . Pursuant to Internal Revenue Code Section 409A, a “Specified Executive” means a key employee (as defined in Section 416(i) of the Code without regard to paragraph 5 thereof) of the Corporation (or its Successor) if any stock of the Corporation (or its Successor) is publicly traded on an established securities market or otherwise.

(r) Successor . The definition of “Successor” is set forth in Section 26(a) below.

2. Employment and Term . The Corporation hereby hires Executive, and Executive hereby agrees to continue to serve as its Chief Executive Officer and President, with such duties as normally associated with these positions. Executive shall report directly to the Board. Executive shall also serve in such additional offices for the Corporation (and its Successor), as the Board may specify. The term of employment under this Agreement shall begin on the Effective Date and shall continue three (3) years (the “ Term ”). Each successive anniversary of the Effective Date is referred to herein as an “Anniversary Date”). After expiration of the initial three (3) year Term, the Agreement shall automatically extend for successive one year periods unless the Board or Executive gives notice to the other party that the Term will not be extended no later than sixty (60) days prior to any Anniversary Date of the Term or any extension thereof. If either party gives timely notice that the initial Term or any extension of such Term will not be extended, then this Agreement shall terminate at the conclusion of its then remaining Term, unless terminated sooner as permitted in this Agreement.

(a) Duty of Loyalty . Executive is employed in a position that involves and requires a high level of trust and confidence and requires a significant time commitment. Executive agrees to act at all times with the highest degree of loyalty and integrity toward the Corporation (and its Successor), and shall devote his/her full attention, energies and best efforts on behalf of the Corporation (and its Successor), except as otherwise approved by the Board pursuant to Section 13(b) of this Agreement. Executive further agrees to comply with all policies, guidelines, rules and operating procedures adopted from time to time.

(b) Outside Activities . In addition to activities approved by the Board pursuant to Section 13(b) of this Agreement, Executive may, after making a full disclosure of the material terms, serve on corporate, civic or charitable boards or committees, deliver lectures, fulfill speaking engagements, or manage personal investments, provided that such activities do not individually or in the aggregate interfere with the performance of Executive’s duties under this Agreement (as determined by the Board).

(c) Licenses and Legal Compliance . Executive shall be responsible to obtain and maintain any licenses or certifications which may be required for the performance of his/her duties and shall comply with all laws, regulations and rules that apply to the Corporation (and its Successor) and any aspect of its operation.

3.	Compensation and Benefits .

(a) Base Salary . Executive’s salary shall not be less than $285,000 and shall be subject to possible adjustments on an annual basis (“ Base Salary ”). The annual adjustment to Base Salary, if any, shall be a discretionary increase deemed appropriate by the Board or one of its Committees in accordance with the prevailing salary administration practices of the Corporation. The Base Salary shall be paid in accordance with the Corporation’s regular payroll during the Term, and if applicable, during the severance pay period, less all required payroll taxes and authorized withholdings.

(b) Incentive Compensation . Executive shall be eligible to be considered for incentive compensation, if any, in an amount determined appropriate by the Board based upon the recommendation of the Board’s Compensation Committee and an annual evaluation of achievement of key objectives as may be established from time to time by such Committee.

(c) Vacation . Executive shall be entitled to four (4) weeks of paid vacation for each twelve (12) months during the Term. In the event Executive does not use all four (4) weeks by the Anniversary Date each year, the unused vacation days shall be forfeited and not carried over into the next succeeding year. Executive is not be entitled to receive any additional compensation for failure to take any vacation.

(d) Benefits . Executive shall be entitled to participate, on the same basis as other members of senior management, in all welfare, retirement and/or pension benefit plans that the Corporation (or its Successor) establishes and makes available to all employees. Executive may be considered for perquisite benefits and participation in other executive welfare, retirement, pension benefit or other plans, however, Executive acknowledges that Executive is not entitled to such perquisites and is not entitled to participate in such plans except as specifically approved in writing by the Board.

(e) Expenses . The Executive shall be reimbursed, or the Corporation (or its Successor) shall provide or pay, for all reasonable expenses incurred by Executive in furtherance of or in connection with the business of the Corporation (or its Successor), including, but not by way of limitation, traveling expenses, subject to such reasonable documentation and other limitations as may be established by the Board.

4. Termination for Death or for Cause . The Corporation (or its Successor) may terminate the employment of Executive prior to the expiration of the Term or any renewals, upon Executive’s death or for Cause as set forth in this Section.

(a) Death . Executive’s employment shall terminate automatically upon Executive’s death. Following the Executive’s death, the Corporation (or its Successor) shall pay Executive’s estate any earned but unpaid Base Salary through the date of Executive’s death. Executive’s estate and heirs will be entitled to apply for and receive whatever plan benefits might be in place at the time of Executive’s death. Further, Executive’s eligible dependents shall have the right to continue their health insurance coverage under COBRA.

(b) Cause . The Board, upon a two-thirds vote, may terminate Executive’s employment at any time upon a finding of Cause. No prior notice to Executive shall be required for any finding of Cause. Nonetheless, the Board may, in its sole discretion, afford the Executive an opportunity to be heard prior to voting on whether Cause exists to terminate his employment. In the event the Corporation or its Successor terminates Executive’s employment for Cause and the Executive is Separated from Service, then Executive’s right to receive any further compensation or benefits from the Corporation shall cease immediately as of the Date of Termination.

5. Termination for Disability . If, as a result of Executive’s incapacity due to an accident or physical or mental illness, Executive is substantially unable to perform Executive’s duties due to such physical or mental impairment, even with reasonable accommodation, for a period of ninety (90) consecutive days, or for a total of twenty-six (26) weeks, whether or not consecutive during any 365 day period, then the Board shall have the right to terminate Executive’s employment for “Permanent Disability” before the end of the applicable Term. The determination of whether Executive has a “Permanent Disability” shall be made by the Board by a majority vote after receiving a report from a physician and/or psychiatrist selected by the Board. Notwithstanding, if there is a third-party determination that the Executive is eligible for benefits under any policy for long-term disability benefits provided to the Executive by the Corporation, then this determination shall conclusively establish the Executive’s Permanent Disability and his employment will be terminated.

(a) In the event that Executive is Separated from Service as a result of “Permanent Disability” during the Term, his right to further pay or benefits will cease as of the Date of Termination. However, Executive shall receive a lump sum payment equal to (90) days of Executive’s then applicable Base Salary as a one-time severance, which shall be made within sixty (60) days after the Date of Termination.

(b) After Executive’s Separation from Service as a result of “Permanent Disability,” the Corporation shall also reimburse Executive, after receipt of reasonable documentation, for any premium payments made to maintain continuous medical and/or dental insurance coverage to which the Executive is entitled under Part 6 of Subtitle B of Title I of the Employee Retirement Income Security Act of 1974, as amended (commonly known as COBRA ) for a period of six (6) months from the date of Date of Termination. These reimbursement payments will be imputed as income to the Executive and reported on a W-2.

6. Termination Upon Expiration of Term . In the event that either the Corporation (or its Successor) or the Executive gives notice under Section 2 that the Term is not to be renewed but will terminate at the end of the then current Term, Executive’s employment, if not otherwise terminated under Sections 4 or 5, shall automatically terminate as of May 31 of the year in which the Term ends. In this situation, neither the Corporation nor its Successor shall owe Executive any severance, subject only to the provisions of Section 10(a).

7. Termination by Corporation Without Cause . In the event the Corporation (or its Successor) desires to terminate Executive’s employment for any reason other than as set forth in Sections 4, 5 or 6, the Corporation (or its Successor) may do so by providing at least sixty (60) days prior written notice, or in lieu thereof, may relieve Executive of all duties and place Executive on a sixty (60) day paid administrative leave, and such a paid leave of absence shall not be deemed a breach of this Agreement. Upon the Executive’s Separation of Service under these circumstances, and subject to the provisions of Section 7(a), the Corporation (or its Successor) shall pay Executive severance in the form of continuing to pay Executive’s then applicable Base Salary for the balance of the existing Term of this Agreement (for purposes of this Section 7, the “ Remaining Term ”), but in no event shall the severance period exceed eighteen (18) months from the Date of Termination. In addition, if the Executive elects continuation coverage under COBRA after his Separation from Service, the Corporation (or its Successor) shall pay the required COBRA premiums on the Executive’s behalf so as to provide continued medical and dental insurance for the Executive and his dependents until the earlier of (i) the expiration of the Remaining Term but not to exceed eighteen (18) months from the Date of Termination; (ii) Executive commences full-time employment with another employer; or (iii) the date on which the Corporation determines that the Executive has violated any provisions of Sections 13-16 of this Agreement.

(a) Exclusive Remedy and Preconditions . The payment of any amounts under this Section 7 or Section 8 below, if applicable, shall be the Executive’s sole and exclusive remedy for termination of this Agreement, and is subject to and conditioned upon: (i) prior receipt by the Corporation or its Successor of an executed and unrevoked separation agreement, in a form provided by the Corporation, that contains a valid and comprehensive waiver and release of any and all claims the Executive has or may have against the Corporation, its Successor as well as any and all of their then current or former officers, directors, employees and agents, (ii) compliance with the restrictions contained in Sections 13-16 this Agreement which survive termination of employment, and (iii) compliance with the tax provisions of Section 12, if applicable.

(b) Alternative Benefit . Notwithstanding the foregoing, if the Corporation (or its Successor) terminates the employment of Executive under Section 6 (above) or without Cause under this Section 7 in connection with, or within two (2) years after, a Change of Control and there is a Separation from Service, then Executive shall be eligible to receive the benefits provided by Section 10(a), but he shall not be entitled to receive any benefits under this Section 7.

8. Termination by Executive for Good Reason . In the absence of a Change of Control, if Executive terminates his employment under this Agreement for Good Reason and is Separated from Service, Executive shall be entitled to severance and benefits as if Executive were terminated without Cause by the Corporation (or its Successor) under Section 7. On the other hand, if, within two (2) years of a Change of Control, Executive terminates his/her employment under this Agreement for Good Reason and is Separated from Service, Executive shall be entitled to severance and benefits as if Executive were terminated without Cause by the Corporation (or its Successor) under Section 10.

9. Voluntary Termination by Executive . Except in the case of termination for Good Reason, in the event that Executive terminates or resigns from his employment with the Corporation (or its Successor) prior to or in connection with the expiration of the Term (and any renewals thereof), neither the Corporation nor its Successor shall have any obligation to pay Executive severance benefits of any kind. If Executive elects to resign or terminate employment prior to the expiration of the Term, other than pursuant to Section 8, Executive shall give the Corporation (or its Successor) one hundred twenty (120) days prior written notice. Upon receipt of such notice, the Corporation may relieve Executive of his duties, in whole or in part, prior to the expiration of the notice period, and his right to receive compensation shall end on his/her last day of employment.

10. Change of Control .

(a) Severance Benefit following a Change of Control . If, in connection with or within two (2) years after a Change of Control, Executive is Separated from Service either because (i) the Corporation (or its Successor) elects not to renew the Agreement under Section 2, (ii) the Corporation (or its Successor) terminates Executive’s employment without Cause under Section 7, or (iii) Executive terminates his employment for Good Reason under Section 8, then, subject to the terms of this Agreement, the Corporation, and/or its Successor shall pay the Executive as follows:

(i) A lump sum cash payment equal to the sum of (A) Executive’s accrued but unpaid Base Salary as of the Date of Termination, plus (B) reimbursement of all reasonable business expenses incurred prior to termination, plus (C) an amount equal to all unused vacation for the year in question, plus (D) any amounts vested but unpaid prior to the Date of Termination under any incentive or bonus plan;

(ii) Subject to Section 10(b) below, a lump sum amount equal to 2.99 times the sum of (x) the greater of (A) the Executive’s Base Salary as in effect immediately before the Change in Control, or (B) as of the Date of Termination, plus (y) an amount equal to the highest annual bonus the Executive received during the two (2) calendar years before the Change in Control (“ Severance Payment ”); and

(iii) Subject to Section 10(b) below, and if the Executive elects COBRA coverage, then for a period of eighteen (18) months following the Date of Termination the Corporation or Successor shall pay all premium costs for the Executive (and his dependents, as applicable) to continue medical and dental insurance coverage upon substantially the same terms of conditions as existed immediately prior to the Executive’s termination, prior to the Date of Termination. (“COBRA Payments”) The costs paid to provide this continued COBRA coverage will be imputed at income to the Executive and reported on a form W-2.

The Severance Payment and COBRA Payments provided under Sections 10(a)(ii) and (iii) are in lieu of any other severance and/or benefits that might otherwise be due to Executive under Sections 6, 7 or 8. No payments under Sections 10(a)(ii) or (iii) shall be due if Executive is terminated under Sections 4, 5 or 9, of if the Executive has breached or breaches the loyalty obligations set forth in Sections 13-16. The benefits provided by Sections 10(a)(ii) or (iii) will not be available to the Executive if there is a Separation from Service prior to the Change of Control, or if the Separation from Service occurs following expiration of 24 months following the Change of Control.

(b) Preconditions . The payment of any amounts under either Section 10(a)(ii) or Section 10(a)(iii), if applicable, shall be subject to and conditioned upon each of the following conditions: (i) the prior receipt by the Corporation or its Successor of an executed and unrevoked separation agreement, in a form provided by the Corporation of its Successor, that contains a valid and comprehensive waiver and release releasing any and all claims Executive may have against the Corporation, and its Successor, as well as any and all of their then current or former officers, directors, employees, and agents; (ii) compliance with the tax provisions of Section 10(c) and Section 12 (below), and (iii) the Executive’s compliance with the provisions of Sections 13-16 of this Agreement.

(c) Tax Issues. If the payments and benefits to be paid pursuant to this Section 10 either alone or together with other payments and benefits which Executive has the right to receive from the Corporation or its Successor, would constitute a “parachute payment” under Section 280G of the Internal Revenue Code (“Code”), the payments and benefits payable by the Corporation or its Successor pursuant to this Section 10 shall be reduced, in the manner determined by Executive, by the amount, if any, which is the minimum necessary to result in no portion of the payments and benefits payable by the Corporation or its Successor under this Section 10 being non-deductible to the Corporation or its Successor pursuant to Section 280G of the Code and subject to the excise tax imposed under Section 4999 of the Code. The determination of any reduction in the payments and benefits to be made pursuant to this Section 10(c) shall be based upon the opinion of the Corporation’s independent public accountants for the Corporation or its Successor and the fee for such calculation shall be borne by the Corporation or its Successor. Such accountants shall promptly prepare the foregoing opinion, but in no event later than thirty (30) days from the Date of Termination, and may use such actuaries such as accountants deemed necessary or advisable for the purpose. Nothing contained herein shall result in a reduction of any payments or benefits to which Executive may be entitled upon termination of employment under any circumstances other than as specified in this Section 10.

11. Withholding . Anything to the contrary notwithstanding, all payments required to be made by the Corporation or its Successor to Executive shall be subject to the withholding of such amounts relating to taxes as the Corporation or its Successor may reasonably determine it should withhold pursuant to any applicable law or regulation.

12. Compliance with Code Section 409A .

(a) General . It is intended that this Agreement comply with the provisions of Section 409A of the Code and the regulations and guidance of general applicability issued thereunder (referred to herein as “Section 409A”) so as to not subject Executive to the payment of additional interest and taxes under Section 409A. In furtherance of this intent, this Agreement shall be interpreted, operated and administered in a manner consistent with these intentions, and to the extent Section 409A would result in Executive being subject to the payment of additional income taxes or interest under Section 409A, the parties agree to amend the Agreement to avoid the application of such taxes and interest.

(b) Delayed Payments . Notwithstanding any provision in this Agreement to the contrary, as needed to comply with Section 409A, if Executive is a “specified employee” (within the meaning of Section 409A), payments due under Sections 6, 7, 8, or 10 above shall be subject to a six (6) month delay such that amounts otherwise payable during the six (6) month period following Executive’s Separation from Service shall be accumulated and paid in a lump-sum catch-up payment as of the first day of the seventh month following Executive’s Separation from Service (or, if earlier, the date of Executive’s death).

(c) Treatment as Separation Pay . This Section 12 shall not apply to the extent such payments can be considered to be separation pay that is not part of a deferred compensation arrangement under Section 409A. If permitted by Section 409A, cash payments to Executive pursuant to Section 5, 7, 8 and 10 shall be considered first to come from separation pay. Toward this end, the installment payments contemplated or required by this Agreement shall be treated as a series of separate payments for Section 409A purposes.

13. Loyalty Obligations . Executive acknowledges and agrees that by virtue of Executive’s position and involvement with the business and affairs of the Corporation and Bank, Executive has developed and will continue to develop substantial expertise and knowledge with respect to all aspects of the Corporation’s business, affairs and operations and has had and will continue to have access to all significant aspects of the business and operations of the Corporation and its Successor, and to Confidential Information. Executive agrees that the following obligations set forth in Sections 13-16 (“Loyalty Obligations”) shall apply in consideration of Executive’s continued employment with the Corporation and its Successor:

(a) Confidential Information .

(i) Confidential Information . At all times during the Term and thereafter, and subject to the limitations of Section 10(f), Executive shall hold in strictest confidence, and shall not use or disclose (except to fulfill Executive’s employment obligations and/or the benefit of the Corporation or its Successor) to any Person or Entity, without authorization of the Corporation or its Successor, any Confidential Information of the Corporation or its Successor.

(ii) Third Party Information . Executive recognizes that the Corporation has received, and in the future will receive, information from third parties that the third party considers to be confidential or proprietary information and which is, or may be, subject to a duty on the part of the Corporation (or its Successor) to restrict its use only for certain limited purposes and to refrain from disclosing that information to others. Executive agrees to hold all such confidential or proprietary information from third parties in the strictest confidence and not to disclose it to any Person or Entity and to use it only as necessary in carrying out Executive’s work for the Corporation (or its Successor) consistent with the obligations of the Corporation (or its Successor) to such third party.

(iii) Security Access . At all times, Executive agrees to (a) comply with and enforce the security policies and procedures as in force from time to time designed to protect access to and safeguard the data, equipment, systems and all other facilities, IT resources and communication technologies of the Corporation (or its Successor), (“Facilities and IT Resources”), (b) not access or use any of the Facilities and IT Resources in any manner after termination of employment (regardless of the circumstances). Executive further agrees to promptly notify the Corporation (or its Successor), as applicable, in the event he/she learns of a violation of any security policies or procedures by others, or of any other misappropriation or unauthorized access, use, or tampering with any of the Facilities and IT Resources by others.

(iv) Work Product . Executive acknowledges that all discoveries, inventions innovations, improvements, developments, methods, designs, analyses, drawings, reports and all similar or related information (whether or not patentable) which relate to the Corporation (or its Successor), and all research and development regarding existing or future products or services which are conceived, developed or made by Executive while employed (“Work Product”) belong to the Corporation (or its Successor). Executive hereby assigns, without further compensation, any and all rights, title or interest Executive has or may have in such Work Product to the Corporation (or its Successor). Executive shall promptly disclose such Work Product to the Corporation (or its Successor) and perform all actions reasonably requested by the Corporation (or its Successor) (whether during or after Executive’s employment) to establish and confirm such ownership (including, without limitation, executing assignments, consents, powers of attorney and other instruments).

(b) Conflicting Employment . Unless otherwise specifically approved by the Board of Parkway or its Successor after full disclosure in writing, during the Term (including the renewals), (i) Executive shall not engage in any other employment, occupation, consulting or other business activity directly related to the business in which the Corporation (or its Successor), is now involved or becomes involved during Executive’s employment; and (ii) Executive shall not engage in any other activities that conflict with the business of the Corporation (or its Successor), or that materially interfere with Executive’s ability to devote the time necessary to fulfill Executive’s obligations to the Corporation (or its Successor).

(c) Return of Property . On the Date of Termination, if not previously requested sooner than that date, Executive shall return to the Corporation (or its Successor) (and will not keep copies in Executive’s possession, recreate or deliver to anyone else) any and all equipment (cell phones, laptops, etc.) credit cards, devices or drives containing confidential information or Work Product, devices, records, data, as well as computer files, records or disks, keys, key or access cards, security devise, notes, reports, proposals, lists, correspondence, specifications, drawings, blueprints, sketches, materials, equipment, other documents or property, or reproductions of any aforementioned items developed by Executive or others pursuant to or during Executive’s employment or otherwise belonging to the Corporation (or its Successor), and their respective successors or assigns regardless of the form in which such information or documents are stored. Executive shall not retain, and shall delete or destroy all electronic copies of such documents and materials containing Confidential Information of the Corporation (or its Successor).

(i) In this regard, if the Executive elects to use a personal computer, laptop, mobile phone or any other type of electronic storage device not owned by the Corporation (or its Successor) (the “Device”) to receive, store, access or send electronic information about any aspect of the Corporation (or its Successor), its business, its financial data, its operations or Customers or Prospects, then he hereby grants to the Corporation (and its Successor) the unconditional right to inspect any and all such Devices at any time upon request (even after termination of employment) to determine if the Device(s) contains Confidential Information, and to remove all Confidential Information from all such Device(s).

(ii) If the Executive elects to use a Device of any kind, he will promptly notify the IT Manager/Director and the Senior Human Resource Manager.

(iii) On or before the Date of Termination, Executive shall deliver all Devices to the IT Manager/Director, or its designee, for inspection for Confidential Information and to remove all such information before returning the Devices.

(d) Notification of New Employer . In the event that Executive leaves the employ of the Corporation (or its Successor) and begins employment elsewhere, Executive agrees the Corporation (or its Successor) may send notice to Executive’s new employer (whether Executive is employed as an employee, consultant, independent contractor, director, partner, officer, advisor or manager) informing the new employer about Executive’s loyalty obligations and restrictions contained in this Agreement.

(e) Post-Employment Duty of Cooperation . By virtue of Executive’s employment, Executive will know information, including but not limited to Confidential Information, that is or may be material to and necessary for the Corporation (or its Successor), to appropriately and successfully conclude matters that involve third parties. As a result, following termination of employment (regardless of the circumstances)) Executive agrees to assist, and cooperate fully with, the Corporation (or its Successor), upon reasonable request, and to do so voluntarily (without legal compulsion) when such matters arise. This duty of cooperation is intended to allow the Corporation (or its Successor) to meet its legal obligations and satisfactorily conclude matters in a manner that achieves the best result possible for the Corporation (or its Successor).

(i) The matters on which cooperation may be requested include, but is not limited to, the actual or contemplated defense, prosecution, or investigation of claims involving the Corporation (or its Successor), and a third party (including employees who may assert claims) as well as responding to any other civil, criminal, administrative or investigative action, suit, proceeding, or inquiry, whether formal or informal, by a federal, state, or law enforcement or regulatory department, agency or authority, where the matter arises from or is related to events, acts, or omissions involving or pertaining to the operations, activities, employees or customers of the Corporation (or its Successor), that occurred during the period of Executive’s employment by the Corporation (or its Successor) (“Third Party Claims”).

(ii) The Executive’s duty to cooperate includes, without limitation, Executive making himself or herself reasonably available upon reasonable notice, without subpoena, to meet with the Corporation (or its Successor), and/or their counsel to provide complete, truthful and accurate information in interviews, depositions, and trial testimony as well as other related support activity. If the Executive provides cooperation under this Section 13(e) during a period in which the Corporation (or its Successor) is paying severance pay to the Executive, then the Corporation (or its Successor) will only reimburse the Executive for all out-of-pocket travel expenses reasonably incurred at the request of the Corporation or its Successor.

(iii) If the cooperation provided occurs when no severance pay is due the Executive, then in addition to reimbursing the Executive for out-of-pocket travel expenses, the Corporation (or its Successor) will also reimburse Executive for his time expended on behalf of the Corporation (or its Successor) at a rate of $400/day, or a pro-rata portion thereof. The Corporation (or its Successor) will make reasonable efforts to accommodate the scheduling needs of Executive so as to avoid, to the maximum extent possible, interference with the Executive’s then current duties and responsibilities.

(f) Limitations/Permitted Disclosures . Nothing in this Section 13 or this Agreement shall be construed to prevent, interfere with or restrict the Executive to make disclosures, reports or complaints as authorized, permitted or required by federal or state law, including without limitation pursuant to the provisions of the Sarbanes-Oxley Act or Dodd-Frank Wall Street Reform Act and Consumer Protection Act or by regulations, rules or orders issued by federal or state regulatory agencies, including without limitations, Virginia Bureau of Financial Institution, Office of Comptroller of the Currency, U.S. Treasury, Bureau of Financial Protection or Securities and Exchange Commission, provided the disclosure does not exceed the extent of disclosure required by such law, regulation, rules or order. Further, nothing in this Agreement shall prevent, impede or interfere (nor shall it be construed to prevent, impede or interfere) with (i) Executive’s obligation to provide full, complete and truthful testimony when so required in response to a subpoena or order from a court or government agency; (ii) Executive’s right to report (including pursuant to whistleblower laws) possible violations of federal, state or local law or other improper actions/omissions to government agencies, to file a charge or complaint of discrimination, harassment or retaliation with government agencies, or to participate or cooperate in any investigation conducted by any government agency; or (iii) the Executive’s right to make confidential disclosures of information (including trade secrets) to a government agency, or to an attorney who is advising the Executive, for the purpose of reporting or as part of an investigation into a suspected violation of law, nor shall it prohibit the Executive from filing a lawsuit, complaint or other document that contains a trade secret, so long as the information containing the trade secret is filed under seal and is not otherwise disclosed except pursuant to court order. Executive understands that his rights when making such protected disclosures are more fully spelled out in 18 USC § 1833, as amended and include immunity from criminal and civil liability from making protected disclosures of trade secrets under the Defend Trade Secrets Act of 2016. Finally, nothing in this Agreement authorizes the Corporation (or its Successor) to terminate Executive’s employment or otherwise retaliate against Executive for engaging in any of the foregoing activities.

(g) Notice of Third Party Request/Order . Unless prohibited by law, regulation or order from doing so, the Executive shall provide written notice of the receipt of a third party request or order to disclose Confidential Information to the Chief Operating Officer, Chief Financial Officer, Chief Compliance Officer, and/or Senior Human Resource Manager for the Corporation (or its Successor) within two (2) business days of receiving this request or order, but in any event sufficiently in advance of making any disclosure so as to permit the Corporation (or its Successor), as appropriate to contest the disclosure ore seek confidentiality protections.

14. Non-Solicitation Restriction . During employment with the Corporation (or its Successor) and for the twenty-four (24) month period that immediately following the termination of the Executive’s employment (regardless of the circumstances), or such time period as the Corporation (or its Successor) is obligated to pay severance benefits under this Agreement (whichever is longer) (“ Restricted Period ”), Executive shall not unfairly compete with the Corporation (or its Successor) by attempting to disrupt business relationships that Parkway, the Bank, any of the Affiliates (or their Successor) have with either: (i) a Customer ( see Section 1(i)) with whom Executive either had communications within the eighteen (18) months prior to the Date of Termination, or as to which Executive received Confidential Information during that eighteen (18) month period, or (ii) a Prospect ( see Section 1(n)).

In this regard, Executive shall refrain during the Restricted Period from engaging in any of the following activities, whether Executive alone, or as an officer, director, stockholder, partner, member, investor, employee, consultant or agent for or on behalf of any other person or legal entity:

(1) Attempting to disrupt or interfere with the business relationship with a Customer ( as limited above ) by directly or indirectly requesting, suggesting, encouraging or advising that Customer to withdraw, curtail, limit, cancel, terminate or not renew all or any portion of the Customer’s business with the Bank , any of the Affiliates or their Successors.

(2) Solicit the business of a Customer (as limited above) by communicating directly with that Customer (regardless of who initiates the communication and in what form it occurs) when as part of the communication Executive discusses or offers a Competitive Service or Product.

(3) Solicit the business of a Prospect by communicating directly with a Prospect (regardless of who initiates the communication and in what form it occurs) when as part of the communication Executive discusses or offers a Competitive Service or Product with the intent to limit, interfere with or divert the Prospect’s business away from the Bank, any of the Affiliates or their Successors.

15. Non-Compete Restriction . At all times during employment and during the Restrict Period (defined above) Executive shall not accept employment with or provide services to or on behalf of any Competing Financial Services Organization if (i) the position or the services to be performed by Executive involve the same or substantially similar duties and responsibilities as those performed by Executive on behalf of the Corporation (or its Successor) during Executive’s last eighteen (18) months of employment with the Corporation (or its Successor), or (ii) Executive is providing consulting, advisory or contract services (whether as a director, officer, independent contractor, member, owner or shareholder) related to the design, development, marketing or delivery of Competitive Services or Products that are intended to be competitive with offerings by the Bank, any of the Affiliates, or their Successor.

(a) Clarification . This restrictive covenant applies only if (a) the Competing Financial Services Organization operates, or is seeking to open, one or more branch facilities, within a sixty (60) mile radius of Floyd, Virginia or within a twenty (20) mile radius of any branch or office operated by the Corporation (or its Successor), (“ Restricted Territory ”) where Competitive Services and/or Products are offered to the public, and (b) Executive will be performing services for the Competing Financial Services Organization in the Restricted Territory, or will be supervising others who will be offering or providing Competitive Services or Products in the Restricted Territory on behalf of the Competing Financial Services Organization.

(b) Limitation . Nothing in this Section shall prevent Executive from owning stock in a publicly traded company that offers Competitive Services or Products in the areas serviced by the Corporation (or its Successor), provided Executive’s ownership constitutes less than five percent (5%) of the outstanding shares of the publicly traded company.

16. Anti-Piracy Restriction . At all times during employment with the Corporation, and during the Restricted Period (defined above), Executive shall refrain from inducing, soliciting or encouraging a Key Employee (defined herein) to leave employment with the Corporation, with the intent, hope or purpose of having the Key Employee join a Competing Financial Services Organization in a similar capacity, if that competitive organization has customer service facilities located within the Restricted Territory (defined above). As used in this Section 16, “ Key Employee ” means anyone who holds a position of Vice President or higher with the Corporation or its Successor or any individuals who have reported to, or worked directly with, the Executive within the last twelve (12) months of Executive’s employment.

17. Enforcement . Executive acknowledges that the restrictive covenants set forth above in Sections 13, 14, 15 and 16 are reasonable and necessary in order to protect the legitimate business interests of the Corporation and its Successor, and that a violation of any of those covenants will result in irreparable injury. In the event of a breach or a threatened breach of any of these Sections of the Agreement, in addition to all other remedies (legal or equitable), the Corporation and its Successor shall be entitled to specific performance of these provisions and the issuance of a restraining order and/or injunction prohibiting Executive from violating one or more of these restrictions. If litigation is filed which relates to or arises under this Sections 13-17, then in addition to all other remedies, if it substantially prevails, the Corporation and its Successor shall be entitled to recover its attorneys’ fees, costs and expenses incurred in connection with the litigation (including all appeals), as well as the pre-litigation efforts to prevent a breach or to enforce the Agreement. Nothing contained herein shall be construed as limiting or prohibiting the Corporation and its Successor from pursuing any other remedies available to it for such breach or threatened breach, including the recovery of amounts paid in severance or other money damages. Should an injunction be issued, Executive waives the right to require that the court require a bond to be posted in excess of $500.00.

18. Notice of Termination . Any purported termination of Executive’s employment under this Agreement (by either party) shall be delivered in writing by a Notice of Termination to the non-terminating party.

19. Amendment and Waiver . The provisions of this Agreement may be amended or waived only with the prior written consent of the Corporation (or its Successor) and Executive, and no course of conduct or failure or delay in enforcing the provisions of this Agreement shall affect the validity, binding effect or enforceability of this Agreement.

20. Severability . Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision or subsection of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law, then such invalidity, illegality or unenforceability cannot be reformed by the court to cause it to be enforceable, then the offending provision shall be stricken from this Agreement, the remainder of this Agreement shall be construed and enforced as if the invalid, illegal or unenforceable provision had never been contained herein.

21. Construction . The parties agree that the traditional rule that often applies whereby an ambiguity in a contract is construed against the drafter shall not apply to this Agreement.

22. Regulatory Requirements and Limitations . Notwithstanding anything contained in this Agreement to the contrary, it is understood and agreed that neither the Corporation nor its Successor shall be required to make any payment or take any action under this Agreement if:

(a) Corporation or its Successor i s declared by any r egulatory a gency or a uthority to be insolvent, in default or operating in an unsafe or unsound manner, or if

(b) in the opinion of counsel to Corporation (or its Successor) such payment or action (i) would be prohibited by or would violate any provision of applicable state or federal law, (ii) would be prohibited by or would violate any applicable rules, regulations, orders or formal statements of policy, whether now existing or hereafter promulgated, of any r egulatory a gency or a uthority, or (iii) otherwise is prohibited by any r egulatory a gency or a uthority.

23. Forum Selection . The parties agree that the exclusive jurisdiction for any lawsuit related to or arising under this Agreement shall be in the Circuit Court for Floyd County, Virginia or the United States District Court for the Western District of Virginia. Executive consents to the jurisdiction of these courts, and waives any objection to jurisdiction and venue which Executive otherwise may have to this venue for any such lawsuit.

24. Applicable Law . This Agreement shall be construed and applied in accordance with the laws of the Commonwealth of Virginia, with the exception of its conflict of law provisions.

25. Survival . Subject to any limits on applicability contained therein, the provisions of Sections 11-17 and Sections 20-27 hereof shall survive and continue in full force notwithstanding any termination of this Agreement. Likewise, in the event that the Corporation or a Successor is obligated to make payments to Executive under this Agreement, and Executive dies before all such payments are made, then the balance of those payments shall be made to Executive’s estate.

26. Successors and Assigns .

(a) Corporation . This Agreement shall bind and inure to the benefit of and be enforceable by the Corporation and its successors or assigns. In the event that a transaction is a Change of Control event occurs, then in connection with the approval or closing of such transaction, the Corporation shall require as a condition of approval and/or closing of the transaction that the surviving or successor entity (“ Successor ”) execute an agreement, in a form and substance acceptable to Executive, whereby the Successor expressly assume and agree to honor and perform this Agreement in the place of the Corporation. In this regard, after a Change of Control event, if the Executive continues employment with the Successor, then for all purposes the Successor shall be deemed the “Corporation” under this Agreement with all rights, responsibilities and obligations to the Executive under this Agreement and likewise by the Executive to the Successor.

(b) Executive . This Agreement shall inure to the benefit and be enforceable by Executive, Executive’s personal and legal representatives, and Executive’s executors, administrators, heirs, successors and assigns. Notwithstanding the foregoing, Executive may not assign any rights or delegate any obligations hereunder without the prior written consent of the Board.

27. Notices . Any notice provided for in this Agreement shall be in writing and shall be either personally delivered, sent by reputable overnight carrier or mailed by first class mail, return receipt requested. Notices to the Executive shall be sent to the Executive’s then current address in accordance with the Corporation’s books and records. Notices to the Corporation shall be sent to:

Parkway Acquisition Corp.

Attn: Chairman of the Board of Directors

101 Jacksonville Circle

Floyd, VA 24091

Notwithstanding the foregoing, each party shall send notices to another address or to the attention of another person as the receiving party shall have specified by prior written notice to the sending party. Any notice under this Agreement will be deemed to have been given when so delivered, sent or mailed.

28. Entire Agreement . This Agreement contains all of the understandings and representations between the parties hereto pertaining to the matters referred to herein, and supersedes any and all undertakings and agreements, whether oral or in writing, previously entered into by them with respect thereto, including any previous employment, severance and/or non-competition agreements. To the extent that a separate agreement currently exists which grants Executive stock options or other incentive or deferred compensation, those agreements remain in full force and effect, except to the extent that those agreements contain restrictive covenants in which case the provisions of Sections 13-17 shall be deemed applicable and replace all such similar provisions.

29. Document Review . The Corporation and Executive hereby acknowledge and agree that each (i) has read this Agreement in its entirety prior to executing it, (ii) understands the provisions and effects of this Agreement, (iii) has consulted with such attorneys, accountants and financial and other advisors as it or Executive has deemed appropriate in connection with their respective execution of this Agreement, and (iv) has executed this Agreement voluntarily and knowingly. EXECUTIVE HEREBY UNDERSTANDS, ACKNOWLEDGES AND AGREES THAT THIS AMENDED AGREEMENT HAS BEEN PREPARED BY LEGAL COUNSEL TO THE CORPORATION AND THAT HE OR SHE HAS NOT RECEIVED ANY ADVICE, COUNSEL OR RECOMMENDATION WITH RESPECT TO THIS AGREEMENT FROM SUCH COUNSEL.

WITNESS the following signatures as of the date first written above:

	PARKWAY ACQUISITION CORP.


Date: June 1, 2019	By:	/s/ Thomas M. Jackson, Jr.
		Chairman of the Board of Directors

	EXECUTIVE


Date: June 1, 2019	/s/ Blake M. Edwards
	Blake M. Edwards

Exhibit 10.2

CHANGE IN CONTROL AGREEMENT

THIS CHANGE IN CONTROL AGREEMENT (the “Agreement”) is entered by and between Parkway Acquisition Corp., a Virginia corporation (“Parkway”), and Rodney R. Halsey (“ Employee ”).

WITNESSETH:

WHEREAS, Employee is employed in the senior management position of Executive Vice President and Chief Operations Officer for Parkway and/or its wholly owned subsidiary, the Skyline National Bank (“Bank”). For purposes of this Agreement, Parkway, the Bank, along with any future Successor (defined below), as a result of a future Change in Control Event shall be referred to herein as the “ Employer ”.

WHEREAS, Parkway desires for the Employee to be eligible for severance benefits in the event that a Change of Control Event occurs during the term set forth in Sections 4(A) and 10 of this Agreement, and desires to secure reasonable protections for its legitimate business interests through certain loyalty obligations.

WHEREAS, the Employee desires to continue employment with Parkway and the Bank and to obtain the benefits provided by this Agreement, and Employee finds the loyalty obligations requested to be reasonable, and understands that these obligations will continue even if the severance benefits are not paid or become payable under Section 4.

WHEREAS , a prior Change in Control Agreement was entered into between the parties on November 22, 2017, but the Employee’s right to receive severance benefits under the earlier agreement terminated.

WHEREAS , the Board of Directors of Parkway has authorized and approved the need for and appropriateness of making this new Agreement with the Employee.

NOW, THEREFORE, in consideration of the mutual promises, covenants and conditions hereinafter set forth, and for other good and valuable considerations, the receipt and sufficiency of which hereby are acknowledged, Parkway and Employee hereby agree as follows:

1. Effective Date of Agreement . This Agreement is effective as of June 1, 2019 (the “ Effective Date ”) and shall remain in effect until terminated as provided herein.

2. Employment . Employee’s employment with Employer has been and will remain an “at will” relationship. This Agreement does not in any way alter the “at will” nature of the relationship, nor does it constitute an agreement by Employer to employ Employee for any particular period of time or in any particular capacity. Nothing in this Agreement is intended or should be interpreted to confer upon Employee the right to continued employment by Employer or to interfere with or restrict in any way the right of Employer to discharge Employee or terminate Employee’s employment at any time or for any reason whatsoever, with or without Cause (defined below), and without any obligation or liability to Employee, except as herein provided, it being the intent of the parties to provide for payment of the severance benefits specified herein only in the event of the termination of Employee’s employment under the circumstances described in Section 3.

3. Definitions . For purposes of this Agreement:

(A) Cause . “Cause” means the termination of Employee’s employment by the Employer as a result of a finding by a majority vote of the Board (excluding Employee if he is a Board member) that any of the following have occurred: (i) Employee has engaged in or has directed others to engage in an act or omission, or series of actions, deemed to be fraudulent, dishonest or unlawful; (ii) any knowing and material breach of this Agreement by Employee; (iii) any knowing and material violation by Employee of corporate policies and procedures that result in damage to the business or reputation of the Employer, including, without limitation, the Bank’s Professional Code of Conduct, Code of Ethics and Conflict of Interest Policy and policies prohibiting discrimination, harassment and/or retaliation; (iv) Employee has engaged in, or has directed others to engage in, a criminal act (other than a minor traffic offense) or other willful misconduct determined to be substantially detrimental to the best interests of the Employer; (v) knowing breach of fiduciary duty by Employee; (vi) Employee fails to follow the directions of the CEO or Board, is grossly neglectful of Employee’s duties or continues to fail to perform assigned duties, which are not cured within twenty-one (21) days after the CEO or Board provides written notice of the issue; (vii) Employee engages in conduct which violates any material law, rule or standard of regulatory agencies governing the Employer, including but not limited to the Virginia Bureau of Financial Institutions, the Office of the Comptroller of the Currency, the U.S. Financial Stability Oversight Council, U.S. Treasury Department, Bureau of Consumer Financial Protection, and the Securities and Exchange Commission; or (viii) demonstrated incompetence of Employee.

(B) A “Change of Control Event” shall have occurred at such time as:

(i) any person or entity, including a “group” as defined in Section 13(d)(3) of the Securities Exchange Act of 1934, a wholly-owned subsidiary thereof, or any employee benefit plan of the Parkway or any of its subsidiaries becomes the beneficial owner of Parkway securities having fifty percent (50%) or more of the combined voting power of the then outstanding securities of Parkway that may be cast for the election of directors of Parkway (other than as a result of the issuance of securities initiated by Parkway in the ordinary course of business); or

(ii) as the result of, or in connection with, any cash tender or exchange offer, merger or other business combination, sale of assets or contested election, or any combination of the foregoing transactions, the holders of all Parkway’s securities entitled to vote generally in the election of directors of the Parkway immediately prior to such transaction constitute, following such transaction, less than a majority of the combined voting power of the then-outstanding securities of the Parkway or any of their respective successor corporations or entities entitled to vote generally in the election of the directors of Parkway or such other corporation or entity after such transactions; or

(iii) such other change of ownership or control event as defined in Treasury Regulation §1.409A-3(i)(5) or any subsequent, applicable Treasury Regulation.

(C) Competing Financial Services Organization . “Competing Financial Services Organization” means an entity unaffiliated with the Employer that is engaged in the commercial, retail or mortgage banking or lending business, wealth management business, investment advisory business, or trust service business that provides services and products that are the same as or competitive with the services that products offered by the Employer immediately prior to the Termination Date or were approved by the Employer to be offered within ninety (90) days of the Termination Date.

(D) Competitive Service or Product . “Competitive Service or Product” means those services or products offered by a Competing Financial Services Organization that are the same as or competitive with those services or products offered by the Employer at the Termination Date or which have been approved by the Employer to be offered within ninety (90) days of the Termination Date.

(E) Confidential Information . “Confidential Information” means all non-public information, technical or financial data, materials, computer records or data, trade secrets and/or know-how regarding Employer or its internal operations, policies that is treated as confidential, that is not generally known by persons who are not employed by the Employer or are not a member of the Boards of Directors of Parkway, the Bank, or the Successor and that is not otherwise available to the public by lawful and proper means. Confidential Information also includes all information regarding shareholders of Parkway, or a Successor, all information received from customers of the Bank, and any affiliates, or Successors as well as the nature of the products and the terms of the services provided to those customers. All such non-public information is considered Confidential Information regardless of the manner which such information is conveyed or stored (orally, written, electronically or digitally) as well as information or materials designated or treated as confidential by a federal or state regulatory or enforcement agency Confidential Information includes, but is not limited to, strategic plans and forecasts; product or service plans or research; customer records and lists; marketing research, plans and/or forecasts; compilations and databases of customers, business or marketing information that are developed by or for the Employer; budget and/or financial information; customer contact, account and mailing information; pricing, costs or profitability analysis; sales and marketing techniques and programs; incentive compensation plans; account information (including loan terms, expiration or renewal dates, fee schedules and commissions); software, access codes, passwords, databases and source codes; inventions; processes, formulas, designs, drawings or engineering information; hardware configuration, and all other financial or other business information or systems of the Employer, as well as the following non-public and sensitive information regarding the employees of the Employer: Social Security numbers, date of birth, names of family members, home addresses and email addresses, telephone numbers, health-related information and compensation information. This definition applies to information generated by Employee or others who work for the Employer, as well as information received from a customer or another third party. The above list is not exhaustive, and Confidential Information also includes other information that is identified, marked or treated as confidential or proprietary, or that would appear to a reasonable person to be confidential or proprietary in the context and circumstances in which the information is known or used. For purposes of this definition, the term “not available to the public” shall include all information or material in the public domain by virtue of improper disclosure by Employee or by another with his permission. Notwithstanding the foregoing, information shall not be considered Confidential Information if (i) such information is already known to others not bound by a duty of confidentiality with respect thereto, (ii) such information is or becomes publicly available through no fault of Employee, or (iii) the furnishing or use of such information is compelled by or in connection with legal or administrative proceedings.

(F) Customer . “Customer” means a Person or Entity that has an account with, loan from, an investment or deposit with the Employer, or that has received or used other financial or investment products or services from the Employer at any time within the twelve (12) months immediately prior to the Termination Date.

(G) Determination of Long Term Incapacity . “Determination of Long Term Incapacity” shall mean a good faith determination by Employer that, as a result of mental or physical illness or injury Employee has failed to perform Employee’s assigned duties with Employer on a full time basis for a period exceeding six (6) consecutive months.

(H) Employer . “Employer” means any or all of the following: Parkway Acquisition Corp., it’s subsidiary Skyline National Bank and all of Parkway or the Bank’s other existing or future affiliates or subsidiaries, as well as any Successor (see Section 3(L) below.

(I) Good Reason . “Good Reason,” subject to compliance with the provisions of Section 4(F), shall mean the existence of one or more of the following conditions, in the good faith judgment of Employee, which arises in connection with or within twelve (12) months after the effective time of a Change in Control Event absent the express consent of Employee:

(i) a reduction in Employee’s base compensation below the sum of 90% of the Employee’s Base Salary as of the date of this Agreement;

(ii) a material reduction in the Employee’s position such that the Employee is no longer considered an officer-level employee of either a bank or bank holding company; or

(iii) a change in the geographic location at which Employee must perform services over 120 miles from the location at which Employee was serving immediately prior to the Change in Control Event.

To avoid any confusion under this Section 3(I)(ii), the Employee, who currently holds a senior executive position with either or both Parkway and the Bank has no right to insist on the same position at the same level with the Employer after a Change in Control Event. Employee will have no right to claim a Good Cause termination under Section 3(I)(ii), if Employee is retained after the Change in Control Event but is demoted and given a lower-level officer position (e.g., CFO to Controller, or CLO to Regional Market Manager) so long as the base salary for the new position remains at or above the guaranteed amount in Section 3(I)(i). If however, in connection with the change in position and status, the Employer also imposes either a reduction in the Employee’s guaranteed base salary or requires a material geographic relocation, then Good Cause may be declared to exist under Sections 14(I)(i) and/or (iii).

(J) Other than Good Reason . “Other than Good Reason” shall mean any voluntary termination by Employee which is not for Good Reason.

(K) Person/Entity . “Person” shall mean any Entity or individual, and the heirs, executors, administrators, legal representatives, successors, and assigns of such “Person” where the context so permits. The term “Entity” shall mean any general partnership, limited partnership, limited liability company, corporation, joint venture, trust, business trust, cooperative or association or any foreign trust or foreign business organization.

(L) Successor . “Successor” shall mean any person or entity (corporate or otherwise) into which, after a Change in Control Event, Parkway, the Bank and/or their subsidiaries and affiliates (or their successors or assigns) shall be merged or consolidated or to which all or substantially all of the assets (including, but not limited to, a sale of substantially all of Parkway, the Bank or the Bank's loan assets) shall be transferred in any manner as provided in Section 3(B) or which by agreement assumes the Employer’s obligations under this Agreement, or which in connection with and after a Change in Control Event becomes (by agreement, operation of law or otherwise) the employer of Employee.

(M) Retirement . “Retirement” shall mean Employee’s retirement from employment with the Employer on or after reaching age 65.

(N) Termination Date . “Termination Date” means the effective date as of which Employee’s employment with Employer is terminated or is deemed terminated.

4. Severance Benefits in Certain Events . If at the effective time of a “Change in Control Event” (as defined above) or any time within twelve (12) months immediately following a Change in Control Event, (i) the Employer terminates Employee’s employment without “Cause” (as defined above) or, (ii) the Employee terminates employment for “Good Reason” (as defined below), then in the event of either (i) or (ii), and subject to each of the following: (x) the limitations set forth herein and in Section 9 below, (y) compliance with the various loyalty obligations set forth in Sections 11 to 14, and (z) the Employee’s execution of a comprehensive Waiver and Release prepared by Employer that waives and releases all claims relating to or arising from Employee’s employment and the termination of that employment, the Employer shall pay or cause to be paid the following severance benefits: (a) an amount equal to two times the Employee’s annualized base salary using the greater of (i) Employee’s annualized base salary for the calendar year preceding the year in which the Termination Date occurs or (ii) the annualized base salary for the calendar year in which the Termination Date occurs, and (b) if the Employee elects COBRA continuation coverage under the Employer’s health plan, then the Employer will pay on the Employee’s behalf the premiums required for employee-only COBRA coverage for up to a maximum of eighteen (18) months.

(A) Employee shall not be entitled to any severance benefits under this Agreement if no Change in Control Event occurs on or before May 31, 2020 , as the Employer’s obligation to pay severance under this Agreement terminates no later than May 31, 2020 as specified in Section 10 below, unless the Employer extends the term by an amendment to this Agreement. Moreover, to avoid any confusion, Employee will not be entitled to any severance benefits under this Agreement, even if the Employer terminates the Employee without Cause (subject only to the protection provided by Section 4(C) below) or the Employee terminates employment for Good Reason during the term of this Agreement if no Change of Control Event has occurred at the time of termination of employment.

(B) If at any time, even if a covered Change in Control Event occurs during the term of this Agreement, (i) the Employer terminates Employee’s employment for “Cause,” (ii) Employee voluntarily terminates Employee’s employment with Employer for Other than Good Reason, or (iii) Employee’s employment terminates or is terminated due to Employee’s death, Retirement or pursuant to a Determination of Long Term Incapacity, then in any of these situations, the Employee shall have no right to severance benefits under this Agreement.

(C) If however, Employee’s employment is terminated by Employer without Cause prior to the effective time of a Change in Control Event, but following the date on which Parkway’s Board of Directors has taken action to approve an agreement, including any definitive agreement or an agreement in principle, relating to a Change in Control Event and that event occurs within six (6) months of the Employee’s termination from employment with Employer, then for purposes of this Agreement, Employee shall be deemed to be employed by the Employer as of the effective date of that Change of Control Event (should it occur), and such termination of employment shall be deemed to occur at the effective time of the Change in Control Event, and in this event, the Employee will be entitled to severance benefits under Section 4 of this Agreement.

(D) The base salary amount payable under this Section 4 shall be payable over twenty-four (24) months in equal installments that coincide with the Employer’s regular paydays and the COBRA premium payments shall each be paid beginning on the first regular pay period of Employer after the Waiver and Release becomes binding. These payments are subject to all applicable tax withholdings, and the Employee’s compliance with the loyalty obligations set forth in Section 11 below.

(E) Further, in order for the Employee to exercise the right to terminate for Good Reason, and to be eligible for severance benefits under this Agreement, Employee must first give the Employer written notice of the condition believe to constitute Good Reason and must provide the Employer at least thirty (30) days to remedy such condition, and if the Employer fails to remedy the condition, the Termination Date shall be on the thirty-first (31st) day after the notice is given.

5. Possible Reduction in Payment and Benefits . If the payments and benefits payable to Employee pursuant to this Agreement, either alone or together with other payments and benefits which Employee has the right to receive from Employer, would constitute a “parachute payment” under Section 280G of the Internal Revenue Code (“Code”), the payments and benefits payable by Employer pursuant to this Agreement shall be reduced, in the manner determined by Employee, by the amount, if any, which is the minimum necessary to result in no portion of the payments and benefits payable by the Employer under this Agreement being non-deductible to the Employer pursuant to Section 280G of the Code and subject to the excise tax imposed under Section 4999 of the Code. The determination of any reduction in the payments and benefits to be made pursuant to this Section 4 shall be based upon the opinion of the Employer’s independent public accountants and the fee for such calculation shall be borne by the Employer. Such accountants shall promptly prepare the foregoing opinion, but in no event later than thirty (30) days from the Termination Date, and may use such actuaries such as accountants deemed necessary or advisable for the purpose.

6. Compliance with Code Section 409A . It is intended that this Agreement comply with the provisions of Section 409A of the Code and the regulations and guidance of general applicability issued thereunder (referred to herein as “Section 409A”) so as to not subject the Employee to the payment of additional interest and taxes under Section 409A. In furtherance of this intent, this Agreement shall be interpreted, operated and administered in a manner consistent with these intentions, and to the extent Section 409A would result in the Employee being subject to the payment of an excise tax or any other additional income taxes or interest under Section 409A, the parties agree to amend this Agreement to avoid the application of such taxes and interest. The parties further intend the installment payments contemplated or required by this Agreement to be treated as a series of separate payments for 409A purposes.

(A) Notwithstanding any provision in this Agreement to the contrary, as needed to comply with Section 409A, if the Employee is a “specified employee” (within the meaning of Section 409A), payments due under this Agreement shall be subject to a six (6) month delay such that amounts otherwise payable during the six (6) month period following the Employee’s separation from service (as defined in Treasury Reg. §1.409A-1(h)) shall be accumulated and paid in a lump-sum catch-up payment as of the first day of the seventh month following the Employee’s separation from service (or, if earlier, the date of the Employee’s death). To the extent that the Employee is required to pay for the cost of any benefits to keep them in full force and effect during the six (6) month delay period, the Employee shall also be reimbursed for such out-of-pocket expenses as of the same date provided above.

(B) This Section 6 shall not apply to the extent such payments can be considered to be separation pay that is not part of a deferred compensation arrangement under Section 409A.

7. Legal Fees and Costs and Interest . If the Employee files suit to enforce rights or receive benefits under this Agreement, and substantially prevails, then the court shall award the Employee a dollar amount sufficient to cover the Employee’s reasonable attorney fees and expenses incurred in the litigation. If however, the Employer prevails in such action, then the Employee shall be liable to reimburse the Employer for its attorney fees and costs, but not to exceed a total amount of $50,000. In the event that Employee is entitled to any payment under Section 4 or Section 7 hereof and such payment is not made within ten (10) days after it was due or is determined to have been due, it shall bear interest at the rate of three (3%) percent per annum from the date it was due until paid.

8. Documents . All documents, record, tapes and other media of any kind or description relating to the business of Employer or any of its subsidiaries and affiliates (the “Documents”), whether or not prepared by Employee, are and shall be the sole and exclusive property of Employer. The Documents (and any copies) shall be returned to Employer upon Employee’s termination of employment for any reason or at such earlier time or times as Employer may specify. Employee and Employee’s legal counsel shall, upon reasonable notice and during normal business hours, have access to all records of Employer, related to determining whether and when a Change in Control Event has occurred and the commencement of consideration thereof.

9. Regulatory Requirements & Limitations . Notwithstanding anything contained in this Agreement to the contrary, it is understood and agreed that Employer shall not be required to make any payment or take any action under this Agreement if:

(A) Employer is declared by any Regulatory Agency or Authority to be insolvent, in default or operating in an unsafe or unsound manner, or if

(B) in the opinion of counsel to Employer such payment or action (i) would be prohibited by or would violate any provision of state or federal law applicable to Employer, (ii) would be prohibited by or would violate any applicable rules, regulations, orders or formal statements of policy, whether now existing or hereafter promulgated, of any Regulatory Agency or Authority, or (iii) otherwise is prohibited by any Regulatory Agency or Authority.

10. Termination of Right to Severance . The Employee’s right to severance benefits under Section 4 of this Agreement shall terminate automatically and the Employer’s obligation to pay severance shall become null and void upon the earlier of (a) May 31, 2020 , unless the circumstances described Section 4(C) occur or this Agreement is amended to extend the time period as permitted under Section 19, or (b) the termination of the Employee’s employment for any reason other than a termination that triggers the Employer’s obligation to provide severance benefits under Section 4. Following any such termination of severance rights under this Agreement, Employee shall have no further rights or entitlement to severance benefits under this Agreement, except as provided in Section 4(C). However, while the right to severance benefits shall terminate, the remaining provisions of this Agreement shall survive and shall continue to apply in full force and effect at all times during the remainder of the Employee’s employment with the Employer and thereafter as set forth below.

11. Loyalty Obligations . Employee acknowledges and agrees that by virtue of the senior position held and his detailed involvement with the business and affairs of the Employer, Employee will develop substantial expertise and knowledge with respect to all aspects of the Employer’s business, affairs and operations and will have access to all significant aspects of the business, plans and operations of Employer, including the Confidential Information (defined in Section 3(E)). As such, Employee acknowledges that he owes a fiduciary duty of loyalty to the Employer to act in its best interests at all times, and Employee agrees that the provisions of this Section 11, as well as Sections 12 to 14 below (collectively the “Loyalty Obligations”) are reasonable and necessary in order to protect the best interests of the Employer and survive any termination of the right to receive severance benefits under Section 4 above.

(A) Confidential Information . At all times, even after termination of employment (regardless of the circumstances), but subject to the limitations of Section 11(E), Employee shall hold in strictest confidence, and shall not use or disclose any of the Confidential Information (defined in Section 13(E)) to any Person or Entity, except to fulfill his employment obligations and while acting for the benefit and best interest of Employer, unless expressly authorized to do so by the President and CEO of Employer. This duty to protect, and not use or disclose Confidential Information shall remain in full force and effect until such time as the information becomes available to the public by lawful and proper means, and without a breach of duty of confidentiality by the Employee or another.

(i) Third Party Information . Employee also recognizes that Parkway, the Bank and their affiliates have received, and in the future will receive, information from third parties that the third party considers to be confidential or proprietary information and which is, or may be, subject to a duty on the part of Parkway, the Bank or their affiliates not to disclose to others and to restrict its use only for certain limited purposes. Employee agrees to hold all such confidential or proprietary information from third parties in the strictest confidence and not to disclose it to any Person or Entity to use it except as necessary in carrying out Employee’s work for the Employer consistent with the obligations of Employer to such third party.

(ii) Security and Access . At all times, Employee agrees to (a) comply with and enforce the security policies and procedures which seek to protect and safeguard the data, equipment, systems and all other facilities, IT resources and communication technologies of the Employer, Bank or its Affiliates (“Facilities and IT Resources”), and (b) not access or use any of the Facilities and IT Resources in any manner after termination of employment (regardless of the circumstances). Employee further agrees to promptly notify the Employer, Bank or Affiliates, as applicable, in the event he learns of a violation of any security policies or procedures by others, or of any other misappropriation or unauthorized access, use, or tampering with any of the Facilities and IT Resources by others.

(B) Conflicting Employment . During employment by Employer, unless otherwise specifically approved by the Board after full disclosure in writing, (i) Employee shall not engage in any other employment, occupation, consulting or other business activity directly related to the business in which the Employer is now involved or becomes involved during Employee’s employment; and (ii) Employee shall not engage in any other activities that conflict with the business of the Employer or that materially interfere with her ability to devote the time necessary to fulfill her obligations to the Employer.

(C) Notification of New Employer . In the event that Employee leaves the employ of the Employer and begins employment elsewhere, Employee agrees the Employer may send notice to Employee’s new employer (whether Employee is employed as an employee, consultant, independent contractor, director, partner, officer, advisor or manager) informing the new employer about Employee’s loyalty obligations and restrictions contained in this Agreement.

(D) Post-Employment Duty of Cooperation . By virtue of Employee’s employment, Employee will know information, including but not limited to Confidential Information, that is or may be material to and necessary for the Employer to appropriately and successfully conclude matters that involve third parties. As a result, following termination of employment (regardless of the circumstances)) Employee agrees to assist, and cooperate fully with, the Employer upon reasonable request, and to do so voluntarily (without legal compulsion) when such matters arise. This duty of cooperation is intended to allow the Employer to meet its legal obligations and satisfactorily conclude matters in a manner that achieves the best result possible for the Employer.

(i) The matters on which cooperation may be requested include, but is not limited to, the actual or contemplated defense, prosecution, or investigation of claims involving the Employer or any of its subsidiaries or affiliate, by a third party (including employees who may assert claims) as well as responding to any other civil, criminal, administrative or investigative action, suit, proceeding, or inquiry, whether formal or informal, by a federal, state, or law enforcement or regulatory department, agency or authority, where the matter arises from or is related to events, acts, or omissions involving or pertaining to the operations, activities, employees or customers of the Employer that occurred during the period of Employee’s employment by the Employer (“ Third Party Claims ”).

(ii) The Employee’s duty to cooperate includes, without limitation, Employee making himself reasonably available upon reasonable notice, without subpoena, to meet with the Employer and/or their counsel to provide complete, truthful and accurate information in interviews, depositions, and trial testimony as well as other related support activity. If the Employee provides cooperation under this Section 11(D) during a period in which the Employer is paying severance pay to the Employee, then the Employer will only reimburse the Employee for all out-of-pocket travel expenses reasonably incurred at the Employer’s request.

(iii) If the cooperation provided occurs when no severance pay or benefits is due the Employee, then in addition to reimbursing the Employee for out-of-pocket travel expenses, the Employer will also reimburse Employee for his time expended on the Employer’s behalf at a rate of $300/day, or a pro-rata portion thereof. The Employer will make reasonable efforts to accommodate the scheduling needs of Employee so as to avoid, to the maximum extent possible, interference with the Employee’s then current duties and responsibilities.

(E) Limitations/Permitted Disclosures . Nothing in this Section 11 or any other provision of this Agreement shall be construed to prevent, interfere with, limit or restrict the Employee from making disclosures, reports or complaints as authorized, permitted or required by federal or state law, including without limitation pursuant to the provisions of the Sarbanes-Oxley Act or Dodd-Frank Wall Street Reform Act and Consumer Protection Act or by regulations, rules or orders issued by federal or state regulatory agencies, including without limitations, Virginia Bureau of Financial Institution, Office of Comptroller of the Currency, U.S. Treasury, Bureau of Financial Protection or Securities and Exchange Commission, provided the disclosure does not exceed the extent of disclosure required by such law, regulation, rules or order.

Further, nothing in this Agreement shall prevent, limit, impede or interfere (nor shall it be construed to prevent, limit, impede or interfere) with (i) Employee’s obligation to provide full, complete and truthful testimony when so required in response to a subpoena or order from a court or government agency; (ii) Employee’s right to report (including pursuant to whistleblower laws) possible violations of federal, state or local law or other improper actions/omissions to government agencies, to file a charge or complaint of discrimination, harassment or retaliation with government agencies, or to participate or cooperate in any investigation conducted by any government agency; or (iii) the Employee’s right to make confidential disclosures of information (including trade secrets) to a government agency, or to an attorney who is advising the Employee, for the purpose of reporting or as part of an investigation into a suspected violation of law, nor shall it prohibit the Employee from filing a lawsuit, complaint or other document that contains a trade secret, so long as the information containing the trade secret is filed under seal and is not otherwise disclosed except pursuant to court order. Employee further understands that his rights when making such protected disclosures are more fully spelled out in 18 U.S.C. § 1833, as amended, include immunity from criminal and civil liability from making protected disclosures of trade secrets under the Defend Trade Secrets Act of 2016. Finally, nothing in this Agreement authorizes the Employer to terminate Employee’s employment or otherwise retaliate against Employee for engaging in any of the foregoing activities.

(F) Notice of Third Party Request/Order . Unless prohibited by law, regulation or order from doing so, the Employee shall provide written notice of the receipt of a third party request or order to disclose Confidential Information to the designated senior officers of the Parkway or its Successor within two (2) business days of receiving this request or order, but in any event sufficiently in advance of making any disclosure so as to permit the Employer to contest the disclosure or seek confidentiality protections.

12. Non-Solicitation Restriction . During employment with the Employer and for the twenty-four (24) month period that immediately follows the Termination Date (regardless of the circumstances), or such time period as the Employer is obligated to pay severance benefits under this Agreement (whichever is longer) (“ Restricted Period ”), Employee shall not unfairly compete with the Employer by attempting to disrupt business relationships that the Employer has with either: (i) a Customer ( see Section 3(F)) with whom Employee either had communications within the twelve (12) months prior to the Termination Date, or as to which Employee received Confidential Information during that same twelve (12) month period.

In this regard, Employee shall refrain during the Restricted Period from engaging in any of the following activities, whether Employee alone, or as an officer, director, stockholder, partner, member, investor, employee, consultant or agent for or on behalf of any other person or legal entity:

(i) Attempting to disrupt or interfere with the business relationship with a Customer (as limited above) by directly or indirectly requesting, suggesting, encouraging or advising that Customer to withdraw, curtail, limit, cancel, terminate or not renew all or any portion of the Customer’s business with the Employer.

(ii) Solicit the business of a Customer (as limited above) by communicating directly with that Customer (regardless of who initiates the communication and in what form it occurs) when as part of the communication Employee discusses or offers a Competitive Service or Product.

13. Non-Compete Restriction . At all times during employment with the Employer and immediately following the Termination Date (regardless of the circumstances) and throughout the Restricted Period (defined above), Employee shall not accept employment with or provide services to or on behalf of any Competing Financial Services Organization if (i) the position or the services to be performed by Employee involve the same or substantially similar duties and responsibilities as those performed by Employee on behalf of the Employer during Employee’s last twelve (12) months of employment with the Employer, or (ii) Employee is providing consulting, advisory or contract services (whether as a director, officer, independent contractor, member, owner or shareholder) related to the design, development, marketing or delivery of Competitive Services or Products that are intended to be directly competitive with offerings by the Employer.

(A) Clarification . This restrictive covenant applies only if (a) the Competing Financial Services Organization operates, or is seeking to open, one or more branch facilities, within a sixty (60) mile radius of Floyd, Virginia or within a twenty (20) mile radius of any branch or office operated by the Employer (“ Restricted Territory ”) where its Competitive Services and/or Products are offered to the public, and (b) Employee will be performing services for the Competing Financial Services Organization in the Restricted Territory, or will be supervising or providing assistance to others who will be offering or providing Competitive Services or Products in the Restricted Territory on behalf of the Competing Financial Services Organization.

(B) Limitation . Nothing in this Section 13 shall prevent Employee from owning stock in a publicly traded company that offers Competitive Services or Products in the areas serviced by Employer, provided Employee’s ownership constitutes less than five percent (5%) of the outstanding shares of the publicly traded company.

14. Anti-Piracy Restriction . At all times during employment with the Employer, and immediately after the Termination Date (regardless of the circumstances) throughout the Restricted Period (defined above), Employee shall refrain from inducing, soliciting or encouraging a Key Employee (defined herein) of the Employer to quit employment with the intent, hope or purpose of having the Key Employee join a Competing Financial Services Organization in a similar capacity, if that competitive organization has customer service facilities located within the Restricted Territory (defined above). As used in this Section 14, “ Key Employee ” means anyone who holds a position of Vice President or higher with the Employer or any individuals who have reported to, or worked directly with, the Employee within the last six (6) months of Employee’s employment with the Employer.

15. Enforcement . Employee acknowledges that each of the restrictive covenants set forth above in Section 11 through 14 is a stand-alone restriction and can be separately enforced as each is reasonable and necessary in order to protect the legitimate business interests of the Employer. A violation of any one of the covenants in Sections 11–14 will result in irreparable injury to the Employer. In the event of a breach or a threatened breach of this Agreement, in addition to all other remedies (legal or equitable), the Employer shall be entitled to specific performance of these provisions and the issuance of a restraining order and/or injunction prohibiting Employee from violating one or more of these restrictions. Nothing contained herein shall be construed as limiting or prohibiting the Employer from pursuing any other remedies available to it for such breach or threatened breach, including the recovery of amounts paid in severance or other money damages. Should an injunction be issued, Employee waives the right to require that the court require a bond to be posted in excess of $500.00.

16. Severability . Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision or subsection of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law, then such invalidity, illegality or unenforceability cannot be reformed by the court to cause it to be enforceable, then the offending provision shall be stricken from this Agreement, the remainder of this Agreement shall be construed and enforced as if the invalid, illegal or unenforceable provision had never been contained herein.

17. Governing Law/Forum This agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Virginia, with the exception of its conflict of laws provisions. The parties agree that any lawsuit arising under this Agreement, relating to the Employee’s employment or its termination shall be brought and decided exclusively either in the Circuit Court for the City of Roanoke, Virginia or the U.S. District Court for the Western District of Virginia, Roanoke Division. Employee waives any objection to venue or jurisdiction in these courts regardless of where he may live when a suit is filed.

18. Notices . All written notices required by this Agreement shall be deemed given when delivered personally or sent by registered or certified mail, return receipt requested, to the parties at their addresses set forth on the signature page of this Agreement. Each party may, from time to time, designate a different address to which notices should be sent by giving notice thereof in writing to the other party at least three days before the effective date of such change in address.

19. Amendment . This Agreement may not be varied, altered, modified or in any way amended except by an instrument in writing executed by the parties hereto or their legal representatives. In this regard, the Employer may, in its sole discretion, elect to amend this Agreement to extend (but not reduce) the time period or term within which severance benefits may be due by changing the date from May 31, 2018 to a later date. To be effective, any such change to increase the time period or term in which severance benefits may become payable must be memorialized in writing, approved by the Board of Parkway or its Successor, and signed by President & CEO of the Employer and the Employee.

20. Binding Effect . As of the Effective date, this Agreement shall be binding upon Employee and the Employer and the Successor.

21. No Construction Against Any Party . If any part of this Agreement is deemed to be unclear or ambiguous, it shall be construed as if it were drafted jointly by all parties. Employee and Employer agree that neither party was in a superior bargaining position regarding the substantive terms of this Agreement.

22. Entire Agreement . This Agreement constitutes the complete, final and entire agreement of the parties with respect to the matters addressed herein and it supersedes and replaces all other prior agreements and understandings, whether written and oral, express or implied, with respect to the subject matter of this Agreement. No promises, representations or warranties have been made by any party to or for the benefit of the other with respect to such matters which are not expressly set forth herein.

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

	Parkway Acquisition Corp.

	By:	/s/ Thomas M. Jackson, Jr.
		Chairman of the Board of Directors

	Rodney R. Halsey

	/s/ Rodney R. Halsey
	Signature

Exhibit 10.3

CHANGE IN CONTROL AGREEMENT

THIS CHANGE IN CONTROL AGREEMENT (the “Agreement”) is entered by and between Parkway Acquisition Corp., a Virginia corporation (“Parkway”), and Lorina C. Vaught (“ Employee ”).

WITNESSETH:

WHEREAS, Employee is employed in the senior management position of Chief Financial Officer for Parkway and/or its wholly owned subsidiary, the Skyline National Bank (“Bank”). For purposes of this Agreement, Parkway, the Bank, along with any future Successor (defined below), as a result of a future Change in Control Event shall be referred to herein as the “ Employer ”.

WHEREAS , the Board of Directors of Parkway has authorized and approved the need for and appropriateness of making this new Agreement with the Employee.

1. Effective Date of Agreement . This Agreement is effective as of June 1, 2019 (the “ Effective Date ”) and shall remain in effect until terminated as provided herein.

3. Definitions . For purposes of this Agreement:

(A) Cause . “Cause” means the termination of Employee’s employment by the Employer as a result of a finding by a majority vote of the Board (excluding Employee if she is a Board member) that any of the following have occurred: (i) Employee has engaged in or has directed others to engage in an act or omission, or series of actions, deemed to be fraudulent, dishonest or unlawful; (ii) any knowing and material breach of this Agreement by Employee; (iii) any knowing and material violation by Employee of corporate policies and procedures that result in damage to the business or reputation of the Employer, including, without limitation, the Bank’s Professional Code of Conduct, Code of Ethics and Conflict of Interest Policy and policies prohibiting discrimination, harassment and/or retaliation; (iv) Employee has engaged in, or has directed others to engage in, a criminal act (other than a minor traffic offense) or other willful misconduct determined to be substantially detrimental to the best interests of the Employer; (v) knowing breach of fiduciary duty by Employee; (vi) Employee fails to follow the directions of the CEO or Board, is grossly neglectful of Employee’s duties or continues to fail to perform assigned duties, which are not cured within twenty-one (21) days after the CEO or Board provides written notice of the issue; (vii) Employee engages in conduct which violates any material law, rule or standard of regulatory agencies governing the Employer, including but not limited to the Virginia Bureau of Financial Institutions, the Office of the Comptroller of the Currency, the U.S. Financial Stability Oversight Council, U.S. Treasury Department, Bureau of Consumer Financial Protection, and the Securities and Exchange Commission; or (viii) demonstrated incompetence of Employee.

(B) A “Change of Control Event” shall have occurred at such time as:

(i) any person or entity, including a “group” as defined in Section 13(d)(3) of the Securities Exchange Act of 1934, a wholly-owned subsidiary thereof, or any employee benefit plan of the Parkway or any of its subsidiaries becomes the beneficial owner of Parkway securities having fifty percent (50%) or more of the combined voting power of the then outstanding securities of Parkway that may be cast for the election of directors of Parkway (other than as a result of the issuance of securities initiated by Parkway in the ordinary course of business); or

(ii) as the result of, or in connection with, any cash tender or exchange offer, merger or other business combination, sale of assets or contested election, or any combination of the foregoing transactions, the holders of all Parkway’s securities entitled to vote generally in the election of directors of the Parkway immediately prior to such transaction constitute, following such transaction, less than a majority of the combined voting power of the then-outstanding securities of the Parkway or any of their respective successor corporations or entities entitled to vote generally in the election of the directors of Parkway or such other corporation or entity after such transactions; or

(iii) such other change of ownership or control event as defined in Treasury Regulation §1.409A-3(i)(5) or any subsequent, applicable Treasury Regulation.

(E) Confidential Information . “Confidential Information” means all non-public information, technical or financial data, materials, computer records or data, trade secrets and/or know-how regarding Employer or its internal operations, policies that is treated as confidential, that is not generally known by persons who are not employed by the Employer or are not a member of the Boards of Directors of Parkway, the Bank, or the Successor and that is not otherwise available to the public by lawful and proper means. Confidential Information also includes all information regarding shareholders of Parkway, or a Successor, all information received from customers of the Bank, and any affiliates, or Successors as well as the nature of the products and the terms of the services provided to those customers. All such non-public information is considered Confidential Information regardless of the manner which such information is conveyed or stored (orally, written, electronically or digitally) as well as information or materials designated or treated as confidential by a federal or state regulatory or enforcement agency Confidential Information includes, but is not limited to, strategic plans and forecasts; product or service plans or research; customer records and lists; marketing research, plans and/or forecasts; compilations and databases of customers, business or marketing information that are developed by or for the Employer; budget and/or financial information; customer contact, account and mailing information; pricing, costs or profitability analysis; sales and marketing techniques and programs; incentive compensation plans; account information (including loan terms, expiration or renewal dates, fee schedules and commissions); software, access codes, passwords, databases and source codes; inventions; processes, formulas, designs, drawings or engineering information; hardware configuration, and all other financial or other business information or systems of the Employer, as well as the following non-public and sensitive information regarding the employees of the Employer: Social Security numbers, date of birth, names of family members, home addresses and email addresses, telephone numbers, health-related information and compensation information. This definition applies to information generated by Employee or others who work for the Employer, as well as information received from a customer or another third party. The above list is not exhaustive, and Confidential Information also includes other information that is identified, marked or treated as confidential or proprietary, or that would appear to a reasonable person to be confidential or proprietary in the context and circumstances in which the information is known or used. For purposes of this definition, the term “not available to the public” shall include all information or material in the public domain by virtue of improper disclosure by Employee or by another with her permission. Notwithstanding the foregoing, information shall not be considered Confidential Information if (i) such information is already known to others not bound by a duty of confidentiality with respect thereto, (ii) such information is or becomes publicly available through no fault of Employee, or (iii) the furnishing or use of such information is compelled by or in connection with legal or administrative proceedings.

(i) a reduction in Employee’s base compensation below the sum of 90% of the Employee’s Base Salary as of the date of this Agreement;

(ii) a material reduction in the Employee’s position such that the Employee is no longer considered an officer-level employee of either a bank or bank holding company; or

(iii) a change in the geographic location at which Employee must perform services over 120 miles from the location at which Employee was serving immediately prior to the Change in Control Event.

(J) Other than Good Reason . “Other than Good Reason” shall mean any voluntary termination by Employee which is not for Good Reason.

(M) Retirement . “Retirement” shall mean Employee’s retirement from employment with the Employer on or after reaching age 65.

(N) Termination Date . “Termination Date” means the effective date as of which Employee’s employment with Employer is terminated or is deemed terminated.

4. Severance Benefits in Certain Events . If at the effective time of a “Change in Control Event” (as defined above) or any time within twelve (12) months immediately following a Change in Control Event, (i) the Employer terminates Employee’s employment without “Cause” (as defined above) or, (ii) the Employee terminates employment for “Good Reason” (as defined below), then in the event of either (i) or (ii), and subject to each of the following: (x) the limitations set forth herein and in Section 9 below, (y) compliance with the various loyalty obligations set forth in Sections 11 to 14, and (z) the Employee’s execution of a comprehensive Waiver and Release prepared by Employer that waives and releases all claims relating to or arising from Employee’s employment and the termination of that employment, the Employer shall pay or cause to be paid the following severance benefits: (a) an amount equal to the greater of (i) Employee’s annualized base salary for the calendar year preceding the year in which the Termination Date occurs or (ii) the annualized base salary for the calendar year in which the Termination Date occurs, and (b) if the Employee elects COBRA continuation coverage under the Employer’s health plan, then the Employer will pay on the Employee’s behalf the premiums required for employee-only COBRA coverage for up to a maximum of twelve (12) months.

(D) The base salary amount payable under this Section 4 shall be payable over twelve (12) months in equal installments that coincide with the Employer’s regular paydays and the COBRA premium payments shall be paid beginning on the first regular pay period of Employer after the Waiver and Release becomes binding. These payments are subject to all applicable tax withholdings, and the Employee’s compliance with the loyalty obligations set forth in Section 11 below.

(B) This Section 6 shall not apply to the extent such payments can be considered to be separation pay that is not part of a deferred compensation arrangement under Section 409A.

(A) Employer is declared by any Regulatory Agency or Authority to be insolvent, in default or operating in an unsafe or unsound manner, or if

11. Loyalty Obligations . Employee acknowledges and agrees that by virtue of the senior position held and her detailed involvement with the business and affairs of the Employer, Employee will develop substantial expertise and knowledge with respect to all aspects of the Employer’s business, affairs and operations and will have access to all significant aspects of the business, plans and operations of Employer, including the Confidential Information (defined in Section 3(E)). As such, Employee acknowledges that she owes a fiduciary duty of loyalty to the Employer to act in its best interests at all times, and Employee agrees that the provisions of this Section 11, as well as Sections 12 to 14 below (collectively the “Loyalty Obligations”) are reasonable and necessary in order to protect the best interests of the Employer and survive any termination of the right to receive severance benefits under Section 4 above.

(A) Confidential Information . At all times, even after termination of employment (regardless of the circumstances), but subject to the limitations of Section 11(E), Employee shall hold in strictest confidence, and shall not use or disclose any of the Confidential Information (defined in Section 13(E)) to any Person or Entity, except to fulfill her employment obligations and while acting for the benefit and best interest of Employer, unless expressly authorized to do so by the President and CEO of Employer. This duty to protect, and not use or disclose Confidential Information shall remain in full force and effect until such time as the information becomes available to the public by lawful and proper means, and without a breach of duty of confidentiality by the Employee or another.

(ii) Security and Access . At all times, Employee agrees to (a) comply with and enforce the security policies and procedures which seek to protect and safeguard the data, equipment, systems and all other facilities, IT resources and communication technologies of the Employer, Bank or its Affiliates (“Facilities and IT Resources”), and (b) not access or use any of the Facilities and IT Resources in any manner after termination of employment (regardless of the circumstances). Employee further agrees to promptly notify the Employer, Bank or Affiliates, as applicable, in the event he/she learns of a violation of any security policies or procedures by others, or of any other misappropriation or unauthorized access, use, or tampering with any of the Facilities and IT Resources by others.

(ii) The Employee’s duty to cooperate includes, without limitation, Employee making herself reasonably available upon reasonable notice, without subpoena, to meet with the Employer and/or their counsel to provide complete, truthful and accurate information in interviews, depositions, and trial testimony as well as other related support activity. If the Employee provides cooperation under this Section 11(D) during a period in which the Employer is paying severance pay to the Employee, then the Employer will only reimburse the Employee for all out-of-pocket travel expenses reasonably incurred at the Employer’s request.

(iii) If the cooperation provided occurs when no severance pay or benefits is due the Employee, then in addition to reimbursing the Employee for out-of-pocket travel expenses, the Employer will also reimburse Employee for her time expended on the Employer’s behalf at a rate of $300/day, or a pro-rata portion thereof. The Employer will make reasonable efforts to accommodate the scheduling needs of Employee so as to avoid, to the maximum extent possible, interference with the Employee’s then current duties and responsibilities.

Further, nothing in this Agreement shall prevent, limit, impede or interfere (nor shall it be construed to prevent, limit, impede or interfere) with (i) Employee’s obligation to provide full, complete and truthful testimony when so required in response to a subpoena or order from a court or government agency; (ii) Employee’s right to report (including pursuant to whistleblower laws) possible violations of federal, state or local law or other improper actions/omissions to government agencies, to file a charge or complaint of discrimination, harassment or retaliation with government agencies, or to participate or cooperate in any investigation conducted by any government agency; or (iii) the Employee’s right to make confidential disclosures of information (including trade secrets) to a government agency, or to an attorney who is advising the Employee, for the purpose of reporting or as part of an investigation into a suspected violation of law, nor shall it prohibit the Employee from filing a lawsuit, complaint or other document that contains a trade secret, so long as the information containing the trade secret is filed under seal and is not otherwise disclosed except pursuant to court order. Employee further understands that her rights when making such protected disclosures are more fully spelled out in 18 U.S.C. § 1833, as amended, include immunity from criminal and civil liability from making protected disclosures of trade secrets under the Defend Trade Secrets Act of 2016. Finally, nothing in this Agreement authorizes the Employer to terminate Employee’s employment or otherwise retaliate against Employee for engaging in any of the foregoing activities.

12. Non-Solicitation Restriction . During employment with the Employer and for the twelve (12) month period that immediately follows the Termination Date (regardless of the circumstances), or such time period as the Employer is obligated to pay severance benefits under this Agreement (whichever is longer) (“ Restricted Period ”), Employee shall not unfairly compete with the Employer by attempting to disrupt business relationships that the Employer has with either: (i) a Customer ( see Section 3(F)) with whom Employee either had communications within the twelve (12) months prior to the Termination Date, or as to which Employee received Confidential Information during that same twelve (12) month period.

20. Binding Effect . As of the Effective date, this Agreement shall be binding upon Employee and the Employer and the Successor.

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

	Parkway Acquisition Corp.

	By:	/s/ Thomas M. Jackson, Jr.
		Chairman of the Board of Directors

	Lorina C. Vaught

	/s/ Lorina C. Vaught
	Signature