EXHIBIT 10.2

 

AMENDED AND RESTATED

EXECUTIVE EMPLOYMENT AGREEMENT

 

THIS AGREEMENT is made as of the 31st day of December 2008, among Riverview
Financial Corporation (“Corporation”), with principal offices at 3rd and Market
Streets Halifax, PA 17032,  Riverview National Bank (“Bank”) with principal
offices at 101 Lincoln Street, Marysville, Pennsylvania, 17053, and Kirk D. Fox
1575 Shippen Dam Road, Millersburg, Pennsylvania (hereinafter referred to as
“EXECUTIVE”).

 

WITNESSETH:

 

WHEREAS, Halifax National Bank (“Halifax”) is the wholly owned subsidiary of HNB
Bancorp, Inc. (“HNB”);

 

WHEREAS, The First National Bank of Marysville (“Marysville”) is the wholly
owned subsidiary of First Perry Bancorp, Inc. (“First Perry”);

 

WHEREAS, the Executive is Executive Vice President of Halifax;

 

WHEREAS, Executive entered into an Executive Employment Agreement with Halifax
on December 1, 2006, as amended on June 18, 2008;

 

WHEREAS, First Perry and HNB entered into an Agreement and Plan of Consolidation
dated on or about June 18, 2008 (“Consolidation Agreement”) pursuant to which
First Perry and HNB shall consolidate into Corporation and Marysville and
Halifax shall consolidate into the Bank (“Consolidation”);

 

WHEREAS, Executive shall become the President of the Bank;

 

WHEREAS, the parties desire to amend and restate Executive’s employment
agreement as a result of the Consolidation;

 

WHEREAS, this Amended and Restated Executive Employment Agreement shall become
effective upon the Effective Date of the Consolidation as defined in the
Consolidation Agreement;

 

NOW THEREFORE, in consideration of the mutual covenants set forth below and
intending to be legally bound, the parties agree as follows:

 

I.  TERM OF EMPLOYMENT

 

1.                                       The Bank hereby employs the Executive
as President as set forth below, and Executive hereby accepts this employment
and agrees to render such services to the

 

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Bank on the terms and conditions as set forth in this Agreement.  This Agreement
shall be for a three (3) year period (the “Employment Period”) beginning on the
Effective Date of the Consolidation, and if not previously terminated pursuant
to the terms of this Agreement, shall end three years later (the “Initial
Term”).  The employment Period shall be extended automatically for one
(1) additional year on the anniversary date of this Agreement (“Renewal Date”)
and then on each anniversary of the Renewal Date of this Agreement thereafter,
unless Bank or Executive gives contrary written notice to the other ninety (90)
days prior to the anniversary date so that upon such anniversary of the Renewal
Date if notice had not been previously given as provided in this Section I.1,
the Employment Period shall continue for a three (3) year period thereafter. 
References in the Agreement to “Employment Period” shall refer to the Initial
Term of this Agreement and any extensions to the Initial Term.  It is the
intention of the parties that this Agreement be “Evergreen” unless (i) either
party gives written notice to the other party of his or its intention not to
renew this Agreement as provided above or (ii) this Agreement is terminated
pursuant to Section VI of this Agreement.

 

2.                                       During the term of this Agreement the
Executive shall perform such executive services for the Bank as are consistent
with his title and as are assigned to him by the Bank’s Board of Directors.

 

3.                                       During the term of this Agreement, the
Executive shall devote his best efforts, including such portion of his time and
effort to the affairs and business of the Bank as he has customarily provided to
this date.

 

4.                                       The services of Executive shall be
rendered principally in Pennsylvania, but he shall do such traveling on behalf
of the Bank as may be reasonably required.

 

II.  COMPETITIVE ACTIVITIES

 

Executive agrees that during the term of his employment except with the express
consent of the Board of Directors, he will not, directly or indirectly, engage
or participate in, become a director of, or render advisory or other services
for, or make any financial investment in any firm, corporation, business entity
or business enterprise competitive with the Bank; provided, however, that
Executive shall not thereby be precluded or prohibited from owning passive
investments, including investments in the securities of other financial
institutions, so long as such ownership does not require him to devote
substantial time to management or control of the business or activities in which
he has invested.

 

III.  COMPENSATION

 

The Bank will compensate Executive for Executive’s services during the term of
the Agreement at a minimum Annual Base Salary of $130,000 per year, payable at
the same times as salaries are payable to other executive employees. Bank may
from time to time increase Executive’s Annual Base Salary, and any and all such
increases shall be deemed to constitute amendments to this Section to reflect
the increased amounts.

 

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IV.  PARTICIPATION IN RETIREMENT AND MEDICAL PLANS,

LIFE INSURANCE AND DISABILITY

 

1.                                       Executive shall be entitled to
participate in any employee benefit plan of the Bank relating to pension,
profit-sharing or other retirement benefits and health or medical coverage or
reimbursement plans that the Bank may adopt for the benefit of its employees.

 

2.                                       In the event the Executive suffers from
a Disability as defined in Section IV.3, he shall nevertheless continue to
receive an amount equal to and no greater than 100% of his annual base salary,
less amounts payable under any disability plan of the Bank, for the first three
months of his disability.  Thereafter, he shall only be entitled to any amount
provided for in the Bank’s long-term disability policy in effect at the time of
the payments determined therein.

 

3.                                       For purposes of this Agreement,
“Disability” means the Executive is unable to engage in any substantial gainful
activity by reason of any medically determinable physical or mental impairment
that can be expected to result in death or can be expected to last for a
continuous period of not less than twelve (12) months.  The Executive will be
deemed disabled if the Social Security Administration has determined that he is
disabled or if a carrier of any group disability insurance policy provided by
the Bank or made available by the Bank to its employees and covering the
Executive determines that he is disabled provided that the policy’s definition
of disability complies with the definition of disability under IRC Section 409A.

 

V.  ADDITIONAL COMPENSATION AND BENEFITS

 

1.                                       During the term of the Agreement,
Executive will be entitled to participate in and receive the benefits of any
stock option, profit sharing, or other plan, benefit or privilege given to
employees and executives of the Bank or its subsidiaries and affiliates which
may come into existence hereafter, to the extent commensurate with his duties
and responsibilities, as fixed by the Bank’s Board of Directors or any committee
of such Board or of the Bank selected for such purpose.  To the extent Executive
is otherwise eligible and qualifies, he shall participate in and receive such
benefits or privileges.  The Bank shall not make any changes in such plans,
benefits or privileges which would adversely affect Executive’s rights or
benefits, unless such change occurs pursuant to a program applicable to all
executive officers of the Bank and does not result in a proportionately greater
adverse change in the rights or benefits to Executive as compared with any other
executive officer of the Bank.  Nothing paid to Executive under any plan or
arrangement presently in effect or made available in the future shall be deemed
to be in lieu of the salary payable to Executive pursuant to Section III.

 

2.                                       For services performed by Executive
under this Agreement, Bank has established a bonus program for Executive which
is attached hereto as Exhibit A.  The

 

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payment of any such bonuses shall not reduce or otherwise affect any other
obligation of Bank to Executive provided for in this Agreement.

 

VI.  TERMINATION

 

1.                                       In the event Executive’s employment is
terminated, Executive’s right to compensation and other benefits under this
agreement shall be as set forth hereinafter in this Section VI.  In the event
the Executive is terminated in a manner which violates the provisions of this
Agreement, as determined by a court of competent jurisdiction, Bank shall
reimburse Executive for all reasonable costs, including attorney’s fees in
challenging such termination.  Such reimbursement shall be in addition to all
rights to which the Executive is otherwise entitled under this Agreement.

 

2.                                       (a)  If a change in control
(hereinafter referred to as “CIC”) of the Bank shall occur, as defined in 2(b),
and without Executive’s express written consent, thereafter, there shall be:

 

(i)  an involuntary termination of Executive without Cause as defined in
Section VI 8;

 

(ii)  an assignment to Executive of duties inconsistent with Executive’s
positions, duties, responsibilities and status with the Bank immediately prior
to a CIC;

 

(iii)  a change in Executive’s reporting responsibilities, titles or offices in
effect immediately prior to a CIC of the Bank, including any removal of the
Executive from, or any failure to reelect Executive to any of such positions,
except in connection with a termination for disability or retirement;

 

(iv)  a reduction by the Bank in Executive’s annual salary in effect immediately
prior to a CIC or as the same may be increased from time to time; or

 

(v)  the failure of the Bank to continue in effect any bonus, benefit or
compensation plan, life insurance plan, health and accident plan or disability
plan in which the Executive is participating at the time of a CIC of the Bank,
or the taking of any action by Bank which would adversely affect Executive’s
participation in or materially reduce Executive’s benefits under any of such
plans;

then at the option of the Executive, Executive shall within ninety (90) days of
the occurrence of any of the foregoing events, provide notice to Bank of the
existence of the condition and provide Bank thirty (30) days in which to cure
such condition.  In the event that Bank does not cure the condition within
thirty (30) days of such notice, Executive

 

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may resign from employment for Good Reason by delivering written notice (“Notice
of Termination”) to Bank.

 

(b)  For purposes of this Agreement, the definition of a “Change in Control”
(CIC) of the Bank shall mean:

 

(1)(a) a merger, consolidation or division involving Bank or its parent company,
(b) a sale, exchange, transfer or other disposition of substantially all of the
assets of Bank, or (c) a purchase by Bank of substantially all of the assets of
purchase or disposition a majority of the members of the Board of Directors of
the legal entity resulting from or existing after any such transaction and of
the Board of Directors of such entity’s parent corporation, if any, are former
members of the Board of Directors of Bank; or

 

(2)  any “person” (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934 (the “Exchange Act”), other than Bank or any
“person” who on the date hereof is a director or officer of Bank is or becomes
the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of Bank or its parent company representing
thirty five (35%) percent or more of the combined voting power of Bank’s or its
parent company’s then outstanding securities; or

 

(3)  during any period of one (1) year during the term of Executive’s employment
under this Agreement, individuals who at the beginning of such period constitute
the Board of Directors of Bank cease for any reason to constitute at least a
majority thereof, unless the election of each director who was not a director at
the beginning of such period has been approved in advance by directors
representing at least two-thirds of the directors then in office who were
directors at the beginning of the period.

 

Notwithstanding b(1), (2), or (3) or any other provision above, the
consolidation of First Perry Bancorp, Inc. and HNB Bancorp, Inc, pursuant to the
Agreement and Plan of Consolidation dated on or about June 18, 2008 between
First Perry Bancorp, Inc. and HNB Bancorp, Inc. shall not constitute a Change in
Control under this Section or this Agreement.

 

3.                                       In the event that Executive delivers a
Notice of Termination (as defined in Section VI 2 of this Agreement) to Bank,
Executive shall be entitled to receive the compensation and benefits set forth
below:

 

If a “Change in Control” (as defined in Section 2(b) of this Agreement) has also
occurred, Bank shall pay Executive an amount equal to 3.0 times Executive’s
Annual Compensation minus applicable taxes and withholdings, payable in
twenty-four (24) equal monthly installments.  For purposes of this paragraph,
Annual Compensation shall

 

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be defined as Executive’s Annual Base Salary plus the highest bonus received
within the previous two years plus the amount which Bank pays for employee
benefits (including automobile allowance or the value of the use of a Bank
automobile) for Executive for a one year period.  In addition, for three-years
after the date of Executive’s termination, Bank shall provide Executive with
continued participation in all non­cash employee benefit plans, programs or
arrangements (including, without limitation, pension and retirement plans and
arrangements, stock option plans, life insurance and health and accident plans
and arrangements, medical insurance plans, disability plans, and vacation plans)
in which Executive was entitled to participate immediately prior to the date of
termination of his employment provided Executive is eligible to participate in
such plans.  In the event that Executive is not eligible to participate, then
Executive shall receive an amount necessary to reimburse Executive for the cost
incurred by him to obtain substantially similarly benefits.

 

In the event the payment described herein, when added to all other amounts or
benefits provided to or on behalf of the Executive in connection with his
termination of employment, would result in the imposition of an excise tax under
Section 4999 of the Code, Bank will pay to Executive an additional cash payment
(“Gross-up Payment”) in an amount such that the after-tax proceeds of such
Gross-up Payment (including any income tax or Excise Tax on such Gross-up
Payment) will be equal to the amount of the Excise Tax.

 

4.                                       If Executive’s employment with Bank is
terminated by Bank for any reason other than Cause as defined in Section VI 7,
then Executive shall be entitled to an amount equal to 3.0 times Executive’s
Annual Compensation minus applicable taxes and withholdings payable in
twenty-four (24) equal monthly installments. For purposes of this paragraph,
Annual Compensation shall be defined as Executive’s Annual Base Salary plus the
highest bonus received within the previous two years plus the amount which Bank
pays for employee benefits (including automobile allowance) for Executive for a
one year period.  In addition, for three-years after the date of Executive’s
termination, Bank shall provide Executive with continued participation in all
non­cash employee benefit plans, programs or arrangements (including, without
limitation, pension and retirement plans and arrangements, stock option plans,
life insurance and health and accident plans and arrangements, medical insurance
plans, disability plans, and vacation plans) in which Executive was entitled to
participate immediately prior to the date of termination of his employment
provided Executive is eligible to participate in such plans.  In the event that
Executive is not eligible to participate, then Executive shall receive an amount
necessary to reimburse Executive for the cost incurred by him to obtain
substantially similarly benefits.

 

5.                                       Any termination of Executive’s
employment by the Bank or by the Executive shall be communicated by written
notice of termination to the other party by means of United States certified
mail, return receipt requested, pursuant to Section VII 3 of this Agreement. 
For purposes of this Agreement, a “notice of termination” shall mean a dated
notice which shall (i) indicate the specific termination provision in the
Agreement relied upon; (ii) set forth in reasonable detail the facts and
circumstances claimed to

 

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provide a basis for termination of Executive’s employment under the provision so
indicated; and (iii) specify a date of termination, which shall not be less than
thirty nor more than ninety days after such notice of termination.

 

6.                                       Executive shall not be required to
mitigate the amount of any payment provided under this Agreement by seeking
employment or otherwise.

 

7.                                       Termination for Cause. The Board of
Directors of the Bank may terminate Executive’s employment at any time for
cause.  For purposes of this agreement “Cause” includes,

 

(i)  the Executive’s willful failure to perform or to comply with any term or
provision of this Agreement;

 

(ii)  the Executive’s willful failure to perform or to comply fully with any
lawful directive of the Bank’s Board of Directors or of any duly constituted
committee thereof after written notice and a failure to cure within thirty (30)
days of such notice;

 

(iii)                               Executive’s violation of Bank’s EBO policy;
or

 

(iv)  Executive’s removal from office or permanently prohibited from
participating in the conduct of the Bank’s affairs by a final order issued by an
appropriate federal banking agency pursuant to Section 8(e) or 8(g) of the
Federal Deposit Insurance Act or by the Comptroller of the Currency pursuant to
national law.

 

8.                                       In the event that Executive is
terminated for “cause” as defined in Section VI 7, all obligations of Bank under
this Agreement shall terminate.

 

9.                                       Notwithstanding any other provision, in
the event that Executive is determined to be a specified employee (“key
employee”) as that term is defined in Section 409A of the Code, no payment that
is determined to be deferred compensation subject to Section 409A of the Code
shall be made until one day following six months from the date of separation of
service as that term is defined in Section 409A of the Code.

 

VII.  MISCELLANEOUS

 

1.                                       Notwithstanding any other provision
contained in this agreement, the payment or obligation to pay monies or granting
of any rights or privileges to Executive as provided in this Agreement shall not
be in lieu or derogation of the rights and privileges that Executive now has
under any plan or benefit presently outstanding.

 

2.                                       This Agreement may not be modified,
changed, amended, extended, or altered except in writing signed by the Executive
or by his duly authorized representative, and by a duly authorized officer of
the Bank.

 

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3.                                       All notices given or required to be
given shall be in writing, sent by United States certified mail, return receipt
requested, postage prepaid, to Executive (or to Executive’s spouse or estate
upon Executive’s death) at Executive’s last known address, and to the Bank at
its principal office.  All such notices shall be effective when deposited in the
mail in the manner specified in this Section VII 3.  Either party by written
notice may change or designate the place for receipt of all such notices.

 

4.                                       This Agreement amends and supersedes
all previous employment agreements between HNB and Halifax and Executive.

 

VIII.  SUCCESSORS, ETC.

 

1.                                       This Agreement shall inure to the
benefit of and be binding upon Executive, and, to the extent applicable, his
heirs, assigns, executors, and personal representatives and the Bank, its
successors, and assigns, including, without limitation, any person, partnership,
or corporation which may acquire all or substantially all of the Bank’s assets
and business, or with or into which the Bank may be consolidated or merged. 
This provision shall apply in the event of any subsequent merger, consolidation,
or transfer.

 

2.                                       This Agreement is personal to each of
the parties and neither party may assign or delegate any of its rights or
obligations under this Agreement without the prior written consent of the other
party.

 

IX.  APPLICABLE LAW

 

This Agreement shall be governed in all respects and be interpreted by and under
the laws of the Commonwealth of Pennsylvania, except to the extent that such law
may be preempted by applicable federal law, in which event this Agreement shall
be governed and interpreted by and under federal law.  This Agreement shall also
be interpreted as is minimally required to qualify any payment hereunder as not
triggering any penalty on the Executive or the Bank pursuant to Code
Section 409A and the regulations promulgated thereunder.

 

X.  SEVERABILITY

 

If any provision in this Agreement is held by a court of competent jurisdiction
to be invalid, void, or unenforceable, the remaining provisions nevertheless
shall continue in full force and effect.

 

XI.  ARBITRATION

 

Each party agrees that all disputes, disagreements and questions of
interpretation concerning this Agreement (except the question of Executive’s
disability which is governed in Section IV), are to be submitted for resolution,
in Marysville, Pennsylvania,

 

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to the American Arbitration Association (the “Association”) in accordance with
the Association’s National Rules for the Resolution of Employment Disputes or
other applicable rules then in effect (“Rules”).  Bank or Executive may initiate
an arbitration proceeding at any time by giving notice to the other in
accordance with the Rules.  Bank and Executive may, as a matter of right,
mutually agree on the appointment of a particular arbitrator from the
Association’s pool.  The arbitrator shall not be bound by the rules of evidence
and procedure of the courts of the Commonwealth of Pennsylvania but shall be
bound by the substantive law applicable to this Agreement.  The decision of the
arbitrator, absent fraud, duress, incompetence or gross and obvious error of
fact, shall be final and binding upon the parties and shall be enforceable in
courts of proper jurisdiction.  Following written notice of a request for
arbitration, Bank and Executive shall be entitled to an injunction restraining
all further proceedings in any pending or subsequently filed litigation
concerning this Agreement.

 

IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the day
and year first above written.

 

Attest:

 

Riverview Bancorp, Inc.

 

 

 

/s/ David A. Troutman

 

By:

/s/ David W. Hoover

 

 

 

Witness:

 

Riverview National Bank

 

 

 

/s/ David A. Troutman

 

By:

/s/ Robert M. Garst

 

 

 

Witness:

 

EXECUTIVE

 

 

 

/s/ Robert M. Garst

 

/s/ Kirk D. Fox

 

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