PEOPLES BANCORP OF NORTH CAROLINA INC 10-K

ITEM 9A. CONTROLS AND PROCEDURES Evaluation of Disclosure Controls and Procedures The Company’s management, under the supervision and with the participation of the Chief Executive Officer and the Chief Financial Officer of the Company, has concluded, based on their evaluation as of the end of the period covered by this Report, that the Company’s disclosure controls and procedures (as defined in Rule 13A-15(e) promulgated under the Exchange Act) are effective to ensure that information required to be disclosed by the Company in the reports filed or submitted by it under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the applicable rules and forms and include controls and procedures designed to ensure that information required to be disclosed by the Company in such reports is accumulated and communicated to the Company’s management including the Chief Executive Officer and the Chief Financial Officer of the Company as appropriate to allow timely decisions regarding required disclosure. 30 Table of Contents Changes in Internal Controls over Financial Reporting There have been no changes in internal control over financial reporting during the quarter ended December 31, 2025 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting. Management’s Annual Report on Internal Controls over Financial Reporting The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) promulgated under the Exchange Act. The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America. Internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company, (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2025. In making this assessment, management used the criteria established in “Internal Control – Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission in 2013. Based on our assessment and those criteria, management believes that the Company maintained effective internal control over financial reporting as of December 31, 2025. Forvis Mazars, LLP, an independent, registered public accounting firm, has audited the Company’s consolidated financial statements as of and for the year ended December 31, 2025, and audited the Company’s effectiveness of internal control over financial reporting as of December 31, 2025, as stated in their reports, which are included in Item 8 hereof. ITEM 9B. OTHER INFORMATION Trading Arrangements of Section 16 Reporting Persons. During the quarter ended December 31, 2025, no person who is required to file reports pursuant to Section 16(a) of the Securities and Exchange Act of 1934, as amended, with respect to holdings of, and transactions in, the Company’s common shares (i.e. directors and certain officers of the Company) maintained, adopted, modified or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1(c) arrangement”, as those terms are defined in Section 229.408 of the regulations of the SEC. ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS Not applicable 31 Table of Contents PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE The information required by this Item is set forth under the sections captioned “Director Nominees”, “Executive Officers of the Company “, “Security Ownership Of Certain Beneficial Owners and Management, “Section 16(a) Beneficial Ownership Reporting Compliance”, “Code of Business Conduct and Ethics”, “Board Committees – Governance Committee”, “Insider Trading Plans” and “Board Committees – Audit and Enterprise Risk Committee” contained in the Proxy Statement, which sections are incorporated herein by reference. ITEM 11. EXECUTIVE COMPENSATION The information required by this Item is set forth under the section captioned “Compensation Discussion and Analysis”, “Summary Compensation Table”, “Grants of Plan-Based Awards”, “Outstanding Equity Awards at Fiscal Year End”, “Option Exercises and Stock Vested”, “Pension Benefits”, “Nonqualified Deferred Compensation”, “Employment Agreements”, “Potential Payments upon Termination or Change in Control”, “Omnibus Stock Option and Long Term Incentive Plan”, “Director Compensation”, “Compensation Committee – Compensation Committee Interlocks and Insider Participation”, “Compensation Committee – Compensation Committee Report”, and “Pay versus Performance”, contained in the Proxy Statement, which sections are incorporated herein by reference. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS For the information required by the Item see the section captioned “Security Ownership of Certain Beneficial Owners and Management” contained in the Proxy Statement, which section is incorporated herein by reference. The following table presents the number of shares of Company common stock to be issued upon the exercise of outstanding options, warrants and rights; the weighted-average price of the outstanding options, warrants and rights; and the number of options, warrants and rights remaining that may be issued under the Company’s 2020 Omnibus Stock Ownership and Long Term Incentive Plans (the “Omnibus Plan”), in each case as of December 31, 2025. As of December 31, 2025 Plan Category Number of securities to be issued upon exercise of outstanding options, warrants and rights (1) Weighted-average exercise price of outstanding options, warrants and rights (2) Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (a) (b) (c) Equity compensation plans approved by security holders 20,665 $ 0.00 264,640 Equity compensation plans not approved by security holders - - - Total 20,665 $ 0.00 264,640 (1) Includes: 5,385 restricted stock units granted on January 20, 2022, all of which vested on January 20, 2026; 4,760 restricted stock units granted on January 19, 2023, all of which vest on January 19, 2027; 5,940 restricted stock units granted on January 22, 2024, all of which vest on January 22, 2028; and 4,580 restricted stock units granted on February 3, 2025, all of which vest on February 3, 2029. (2) The restricted stock units granted by the Company under the Omnibus Plan do not have an exercise price. The above table excludes shares awarded from time to time pursuant to the Service Recognition Program. The Service Recognition Program is described under the section captioned “Discretionary Bonus and Service Awards” contained in the Proxy Statement. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE See the sections captioned “Indebtedness of and Transactions with Management and Directors” and “Board Leadership Structure and Risk Oversight” contained in the Proxy Statement, which sections are incorporated herein by reference. ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES See the section captioned “Proposal 2 - Ratification of Selection of Independent Registered Public Accounting Firm” contained in the Proxy Statement, which section is incorporated herein by reference. 32 Table of Contents PART IV ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES 15(a)1. Consolidated Financial Statements (contained in the Annual Report attached hereto as Exhibit (13) and incorporated herein by reference) (a) Reports of Independent Registered Public Accounting Firm (b) Consolidated Balance Sheets as of December 31, 2025 and 2024 (c) Consolidated Statements of Earnings for the Years Ended December 31, 2025 and 2024 (d) Consolidated Statements of Comprehensive Income (Loss) for the Years Ended December 31, 2025 and 2024 (e) Consolidated Statements of Changes in Shareholders’ Equity for the Years Ended December 31, 2025 and 2024 (f) Consolidated Statements of Cash Flows for the Years Ended December 31, 2025 and 2024 (g) Notes to Consolidated Financial Statements 15(a)2. Consolidated Financial Statement Schedules All schedules have been omitted, as the required information is either inapplicable or included in the Notes to Consolidated Financial Statements. 15(a)3. Exhibits Exhibit (3)(i)(a) Articles of Incorporation of the Registrant, incorporated by reference to Exhibit (3)(i) to the Form 8-A filed with the Securities and Exchange Commission on September 2, 1999 Exhibit (3)(i)(b) Articles of Amendment dated December 19, 2008, regarding the Series A Preferred Stock, incorporated by reference to Exhibit (3)(1) to the Form 8-K filed with the Securities and Exchange Commission on December 29, 2008 Exhibit (3)(i)(c) Articles of Amendment dated February 26, 2010, incorporated by reference to Exhibit (3)(2) to the Form 10-K filed with the Securities and Exchange Commission on March 25, 2010 Exhibit (3)(i)(d) Articles of Amendment dated February 25, 2022, incorporated by reference to Exhibit (3)(i)(d) to the Form 10-K filed with the Securities and Exchange Commission on March 18, 2022 Exhibit (3)(ii) Third Amended and Restated Bylaws of the Registrant, incorporated by reference to Exhibit (3)(iii) to the Form 8-K filed with the Securities and Exchange Commission on January 17, 2025 Exhibit (4)(i) Specimen Stock Certificate, incorporated by reference to Exhibit (4) to the Form 8-A filed with the Securities and Exchange Commission on September 2, 1999 Exhibit (4)(ii) Description of Registrant’s Securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, incorporated by reference to Exhibit (4)(ii) to the Form 10-K filed with the Securities and Exchange Commission on March 7, 2024 33 Table of Contents Exhibit (10)(i) Amended and Restated Executive Salary Continuation Agreement between Peoples Bank and William D. Cable, Sr. dated December 18, 2008, incorporated by reference to Exhibit (10)(c)(iii) to the Form 8-K filed with the Securities and Exchange Commission on December 29, 2008 (*) Exhibit (10)(ii) Peoples Bank Directors’ and Officers’ Deferral Plan, incorporated by reference to Exhibit 10(h) to the Form 10-K filed with the Securities and Exchange Commission on March 28, 2002 (*) Exhibit (10)(iii) Rabbi Trust for the Peoples Bank Directors’ and Officers’ Deferral Plan, incorporated by reference to Exhibit 10(i) to the Form 10-K filed with the Securities and Exchange Commission on March 28, 2002 (*) Exhibit (10)(iv) Description of Service Recognition Program maintained by Peoples Bank, incorporated by reference to Exhibit 10(i) to the Form 10-K filed with the Securities and Exchange Commission on March 27, 2003 (*) Exhibit (10)(v) Capital Securities Purchase Agreement dated as of June 26, 2006, by and among the Registrant, PEBK Capital Trust II and Bear, Stearns Securities Corp., incorporated by reference to Exhibit 10(j) to the Form 10-Q filed with the Securities and Exchange Commission on November 13, 2006 Exhibit (10)(vi) Amended and Restated Trust Agreement of PEBK Capital Trust II, dated as of June 28, 2006, incorporated by reference to Exhibit 10(k) to the Form 10-Q filed with the Securities and Exchange Commission on November 13, 2006 Exhibit (10)(vii) Guarantee Agreement of the Registrant dated as of June 28, 2006, incorporated by reference to Exhibit 10(l) to the Form 10-Q filed with the Securities and Exchange Commission on November 13, 2006 Exhibit (10)(viii) Indenture, dated as of June 28, 2006, by and between the Registrant and LaSalle Bank National Association, as Trustee, relating to Junior Subordinated Debt Securities Due September 15, 2036, incorporated by reference to Exhibit 10(m) to the Form 10-Q filed with the Securities and Exchange Commission on November 13, 2006 Exhibit (10)(ix) Form of Amended and Restated Director Supplemental Retirement Agreement between Peoples Bank and Directors Robert C. Abernethy, James S. Abernethy, Douglas S. Howard, John W. Lineberger, Jr., Gary E. Matthews, Dr. Billy L. Price, Jr., Larry E Robinson, W. Gregory Terry, Dan Ray Timmerman, Sr., and Benjamin I. Zachary, incorporated by reference to Exhibit (10)(n) to the Form 8-K filed with the Securities and Exchange Commission on December 29, 2008 (*) Exhibit (10)(x) First Amendment to Amended and Restated Executive Salary Continuation Agreement between Peoples Bank and Lance A. Sellers dated February 16, 2018, incorporated by reference to Exhibit (10)(xx) to the Form 10-Q filed with the Securities and Exchange Commission on March 18, 2018 (*) Exhibit (10)(xi) First Amendment to Amended and Restated Executive Salary Continuation Agreement between Peoples Bank and William D. Cable, Sr. dated February 16, 2018, incorporated by reference to Exhibit (10)(xxii) to the Form 10-Q filed with the Securities and Exchange Commission on March 18, 2018 (*) 34 Table of Contents Exhibit (10)(xii) 2020 Omnibus Stock Ownership and Long Term Incentive Plan incorporated by reference to Exhibit (10)(xxi) to the Form 10-K filed with the Securities and Exchange Commission on March 19, 2022 (*) Exhibit (10)(xiii) Employment Agreement dated August 19, 2021 by and among the Registrant, Peoples Bank and Jeffrey N. Hooper, incorporated by reference to Exhibit (10)(a) to the Form 8-K filed with the Securities and Exchange Commission on August 20, 2021 (*) Exhibit (10)(xiv) Amended and Restated Employment Agreement by and among Peoples Bancorp of North Carolina, Inc., Peoples Bank and William D. Cable, Sr., dated as of September 19, 2024 incorporated by reference to Exhibit 10(1) to the Form 8-K filed with the Securities and Exchange Commission on September 20, 2024 (*) Exhibit (10)(xv) Second Amendment To Amended and Restated Executive Salary Continuation Agreement by and between Peoples Bank and William D. Cable, Sr., dated as of September 19, 2024 incorporated by reference to Exhibit 10.2 to the Form 8-K filed with the Securities and Exchange Commission on September 20, 2024 (*) Exhibit (10)(xvi) First Amendment To Executive Salary Continuation Agreement by and between Peoples Bank and Jeffrey N. Hooper, dated as of September 19, 2024 incorporated by reference to Exhibit 10.3 to the Form 8-K filed with the Securities and Exchange Commission on September 20, 2024 (*) Exhibit (10)(xvii) First Amendment to Employment Agreement with each of the Company’s then named executive officers: Lance A. Sellers, President and Chief Executive Officer; Jeffrey N. Hooper, Executive Vice President and Chief Financial Officer; and William D. Cable, Sr., Executive Vice President and Chief Operating Officer, incorporated by reference to Exhibit (10)(i) to the Form 10-Q filed with the Securities and Exchange Commission on November 7, 2024 Exhibit (10)(xviii) Executive Salary Continuation Agreement between Peoples Bank and Jeffrey N. Hooper dated July 1, 2020, incorporated by reference to Exhibit (10)(xxi) to the Form 10-K filed with the Securities and Exchange Commission on March 12, 2025 (*) Exhibit (10)(xiv) Form of Amended and Restated Director Supplemental Retirement Agreement by and between Peoples Bank and members of the board of directors of Peoples Bank, dated December 5, 2025. (*) Exhibit (13) 2025 Annual Report of Peoples Bancorp of North Carolina, Inc. Exhibit (19)(i) Amended and Restated Insider Trading and Section 16 Reporting Policy, incorporated by reference to Exhibit (19)(i) to the Form 10-K filed with the Securities and Exchange Commission on March 12, 2025 Exhibit (19)(ii) Amended and Restated Securities Law Compliance Policy, incorporated by reference to Exhibit (19)(ii) to the Form 10-K filed with the Securities and Exchange Commission on March 12, 2025 Exhibit (21) Subsidiaries of the Registrant Exhibit (23) Consent of Forvis Mazars, LLP Exhibit (31)(i) Certification of principal executive officer pursuant to section 302 of the Sarbanes-Oxley Act of 2002 Exhibit (31)(ii) Certification of principal financial officer pursuant to section 302 of the Sarbanes-Oxley Act of 2002 Exhibit (32) Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 Exhibit (97) Excess Incentive-Based Compensation Recovery Policy, , incorporated by reference to Exhibit (97) to the Form 10-K filed with the Securities and Exchange Commission on March 7, 2024 Exhibit (101) The following materials from the Company’s 10-K Report for the annual period ended December 31, 2025, formatted in eXtensible Business Reporting Language (“XBRL”): (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Earnings, (iii) the Condensed Consolidated Statements of Comprehensive Income (iv) the Condensed Consolidated Statements of Changes in Shareholders’ Equity, (v) the Condensed Consolidated Statements of Cash Flows, and (vi) the Notes to the Condensed Consolidated Financial Statements. Management contracts, compensatory plans and arrangement are marked with an asterisk (*) 35 Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. PEOPLES BANCORP OF NORTH CAROLINA, INC. (Registrant) By: /s/ William D. Cable, Sr. William D. Cable, Sr. President and Chief Executive Officer Date: March 11, 2026 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated: Signature Title Date /s/ William D. Cable, Sr. President and Chief Executive Officer March 11, 2026 William D. Cable, Sr. (Principal Executive Officer) /s/ Jeffrey N. Hooper Executive Vice President and Chief March 11, 2026 Jeffrey N. Hooper Financial Officer (Principal Financial and Principal Accounting Officer) /s/ Robert C. Abernethy, Sr. Chairman of the Board and Director March 11, 2026 Robert C. Abernethy. Sr. /s/ James S. Abernethy Vice Chairman of the Board and March 11, 2026 James S. Abernethy Director /s/ Douglas S. Howard Director March 11, 2026 Douglas S. Howard /s/ John W. Lineberger, Jr. Director March 11, 2026 John W. Lineberger, Jr. /s/ Gary E. Matthews Director March 11, 2026 Gary E. Matthews /s/ Billy L. Price, Jr., M.D. Director March 11, 2026 Billy L. Price, Jr., M.D. /s/ William Gregory Terry Director March 11, 2026 William Gregory Terry /s/ Benjamin I. Zachary Director March 11, 2026 Benjamin I. Zachary /s/ Ashton V. Abernethy Director March 11, 2026 Ashton V. Abernethy /s/ Robert C. Abernethy, Jr. Director March 11, 2026 Robert C. Abernethy, Jr. /s/ Dan Ray Timmerman, Jr. Director March 11, 2026 Dan Ray Timmerman, Jr. 36