EXHIBIT 10.12

 

RIVERVIEW NATIONAL BANK

DIRECTOR EMERITUS AGREEMENT

 

THIS AGREEMENT is made this 19th day of May, 2010 by and between RIVERVIEW
NATIONAL BANK, a national bank located in Marysville, Pennsylvania (the “Bank”),
and Paul Reigle, (the “Director”), to be effective , June 1, 2010.

 

INTRODUCTION

 

To promote orderly succession of the Bank’s Board of Directors, the Bank is
willing to provide benefits to certain former Directors who agree to become
Director Emeritus and provide the services outlined in this Agreement. The Bank
will pay the benefits from its general assets according to the terms of this
Agreement.

 

AGREEMENT

 

The Director and the Bank agree as follows:

 

Article 1

Definitions

 

1.1           Definitions.  Whenever used in this Agreement, the following words
and phrases shall have the meanings specified:

 

1.1.1                        “Change in Control” means a change in the ownership
or effective control of the Corporation or the Bank as described in
Section 409A(a)(2)(A)(v) of the Code.

 

Notwithstanding anything else to the contrary set forth in this Agreement, if
(i) an agreement is executed by the Corporation or the Bank providing for any of
the transactions or events constituting a Change in Control as defined herein,
and the agreement subsequently expires or is terminated without the transaction
or event being consummated, and (ii) Director’s service did not terminate during
the period after the agreement and prior to such expiration or termination, for
purposes of this Agreement it shall be as though such agreement was never
executed and no Change in Control event shall be deemed to have occurred as a
result of the execution of such agreement.

 

1.1.2                        “Code” means the Internal Revenue Code of 1986, as
amended and the regulations promulgated there under.

 

1.1.3                        “Corporation” means Riverview Financial
Corporation.

 

1.1.4                        “Disability” means the Director’s inability to
perform substantially all normal duties of a director, provided such disability
complies with the definition provided under Code Section  409A. As a condition
to receiving any benefits, the Bank may require the Director to submit to such
physical or mental evaluations and tests as the Board of Directors deems
appropriate.

 

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1.1.5        “Final Fee” means the Director’s annualized Board fee in the year
of Termination of Service as a Director of the Bank.

 

1.1.6        “Termination of Service” means the Director’s ceasing to be a
member of the Bank’s Board of Directors for any reason other than death,
provided such termination of service complies with the definition of termination
of service under Code Section 409A.

 

Article 2

Lifetime Benefits

 

2.1           Director Emeritus Benefit.  Upon Termination of Service on or
after age 65, provided the Director has 10 or more years of continuous service
at the date of termination and is willing to provide the ongoing services
described in Section 2.1.3, the Bank shall pay to the Director the benefit
described in this Section 2.1 in lieu of any other benefit under this Agreement.

 

2.1.1                        Amount of Benefit.  The annual Director Emeritus
Benefit under this Section 2.1 is a percentage of the Director’s Final Fee based
on the distribution period elected by the Director in Exhibit A. The Bank may
increase the annual benefit under this Section 2.1 at the sole and absolute
discretion of the Bank’s Board of Directors.

 

2.1.2                        Payment of Benefit.  The Bank shall pay the annual
benefit to the Director in 12 equal monthly installments payable on the first
day of each month commencing with the month following the Director’s Termination
of Service and payable for the number of months specified in Exhibit A.

 

2.1.3                        Contingencies.  The benefit payments described in
Section 2.1 are contingent on the Director (i) electing to become a Director
Emeritus, (ii) being available to the Board for advice and consultation when
called upon, (iii) continuing to act as a “Goodwill Ambassador” for the Bank,
and (iv) avoiding any competitive arrangement (see Section 5.3) which is
contrary to the best interests of the Bank. The Bank’s request for the
Director’s time and service must be reasonable in nature and amount.

 

2.2           Disability Benefit.  If the Director terminates service due to
Disability prior to age 65, the Bank shall pay to the Director the benefit
described in Section 2.1 in lieu of any other benefit under this Agreement,
except that only item (iv) of Section 2.1.3 shall apply.

 

2.3           Change in Control Benefit.  If the Director is in the active
service as a Director or a Director Emeritus of the Bank at the time of a Change
in Control, the Bank shall pay to the Director the benefit described in
Section 2.1 in lieu of any other benefit under this Agreement, except that
Section 2.1.3 shall not apply.

 

Article 3

Death Benefits

 

3.1           Death During Active Service.  If the Director dies after electing
to become a Director Emeritus but before benefit payments have commenced, the
Bank shall pay to the

 

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Director’s beneficiary the benefit described in this Section 3.1. This benefit
shall be paid in lieu of the Lifetime Benefits of Article 2.

 

3.1.1                        Amount of Benefit.  The annual benefit under this
Section 3.1 is a percentage of the Director’s Final Fee based on the
distribution period elected by the Director in Exhibit A.

 

3.1.2                        Payment of Benefit.  The Bank shall pay the annual
benefit to the beneficiary in 12 equal monthly installments payable on the first
day of each month commencing within 60 days of the Director’s death and payable
for the number of months specified in Exhibit A.

 

3.2           Death During Benefit Period.  If the Director dies after the
benefit payments have commenced under this Agreement but before receiving all
120 payments, the Bank shall pay the remaining benefits to the Director’s
beneficiary at the same time and in the same amounts they would have been paid
to the Director had the Director survived.

 

Article 4

Beneficiaries

 

4.1           Beneficiary Designations.  The Director shall designate a
beneficiary by filing a written designation with the Bank. The Director may
revoke or modify the designation at any time by filing a new designation.
However, designations will only be effective if signed by the Director and
accepted by the Bank during the Director’s lifetime. The Director’s beneficiary
designation shall be deemed automatically revoked if the beneficiary predeceases
the Director, or if the Director names a spouse as beneficiary and the marriage
is subsequently dissolved. If the Director dies without a valid beneficiary
designation, all payments shall be made to the Director’s estate.

 

4.2           Facility of Payment.  If a benefit is payable to a minor, to a
person declared incompetent or to a person incapable of handling the disposition
of his or her property, the Bank may pay such benefit to the guardian, legal
representative or person having the care or custody of such minor, incompetent
person or incapable person. The Bank may require proof of incompetency, minority
or guardianship as it may deem appropriate prior to distribution of the benefit.
Such distribution shall completely discharge the Bank from all liability with
respect to such benefit.

 

Article 5

General Limitations

 

Notwithstanding any provision of this Agreement to the contrary, the Bank shall
not pay any benefit under this Agreement:

 

5.1           Excess Parachute or Golden Parachute Payment.  To the extent the
benefit would be an excess parachute payment under Section 280G of the Code or
would be a prohibited golden parachute payment pursuant to 12 C.F.R. §359.2 and
for which the appropriate federal banking agency has not given written consent
to pay pursuant to 12 C.F.R. §359.4.

 

5.2           Termination for Cause.  If the Bank terminates the Director’s
service for:

 

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5.2.1                        Gross negligence or gross neglect of duties;

 

5.2.2                        Commission of a felony or of a gross misdemeanor
involving moral turpitude; or

 

5.2.3                        Fraud, disloyalty, dishonesty or willful violation
of any law or significant Bank policy committed in connection with the
Director’s service and resulting in an adverse effect on the Bank.

 

5.3           Removal.  If the Director is subject to a final removal or
prohibition order issued by an appropriate federal banking agency pursuant to
Section 8(e) of the Federal Deposit Insurance Act.

 

5.4           Competition After Termination of Service.  If the Director,
without the prior written consent of the Bank, engages in, becomes interested
in, directly or indirectly, as a sole proprietor, as a partner in a partnership,
or as a substantial shareholder in a corporation, or becomes associated with, in
the capacity of employee, director, officer, principal, agent, trustee or in any
other capacity whatsoever, any enterprise conducted in the trading area (a 50
mile radius of the main office of the Bank), which enterprise is, or may deemed
to be, competitive with any business carried on by the Corporation as of the
date of termination of the Director’s service or his retirement. This section
shall not apply following a Change in Control.

 

5.5           Suicide.  If the Director commits suicide within two years after
the date of this Agreement, or if the Director has made any material
misstatement of fact on any application for life insurance purchased by the
Bank.

 

Article 6

Claims and Review Procedures

 

6.1           Claims Procedure.  The Bank shall notify any person or entity that
makes a claim against the Agreement (the “Claimant”) in writing, within ninety
(90) days of Claimant’s written application for benefits, of his or her
eligibility or noneligibility for benefits under the Agreement. If the Bank
determines that the Claimant is not eligible for benefits or full benefits, the
notice shall set forth (1) the specific reasons for such denial, (2) a specific
reference to the provisions of the Agreement on which the denial is based, (3) a
description of any additional information or material necessary for the Claimant
to perfect his or her claim, and a description of why it is needed, and (4) an
explanation of the Agreement’s claims review procedure and other appropriate
information as to the steps to be taken if the Claimant wishes to have the claim
reviewed. If the Bank determines that there are special circumstances requiring
additional time to make a decision, the Bank shall notify the Claimant of the
special circumstances and the date by which a decision is expected to be made,
and may extend the time for up to an additional ninety-day period.

 

6.2           Review Procedure.  If the Claimant is determined by the Bank not
to be eligible for benefits, or if the Claimant believes that he or she is
entitled to greater or different benefits, the Claimant shall have the
opportunity to have such claim reviewed by the Bank by filing a petition for
review with the Bank within sixty (60) days after receipt of the notice issued
by the Bank. Said petition shall state the specific reasons which the Claimant
believes entitle him or her to benefits or to greater or different benefits.
Within sixty (60) days after receipt by the Bank of the petition, the Bank shall
afford the Claimant (and counsel, if any) an opportunity to present his

 

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or her position to the Bank orally or in writing, and the Claimant (or counsel)
shall have the right to review the pertinent documents. The Bank shall notify
the Claimant of its decision in writing within the sixty-day period, stating
specifically the basis of its decision, written in a manner calculated to be
understood by the Claimant and the specific provisions of the Agreement on which
the decision is based. If, because of the need for a hearing, the sixty-day
period is not sufficient, the decision may be deferred for up to another
sixty-day period at the election of the Bank, but notice of this deferral shall
be given to the Claimant.

 

Article 7

Amendments and Termination

 

This Agreement may be amended or terminated only by a written agreement signed
by the Bank and the Director, except as specified in Article 5.

 

Article 8

Miscellaneous

 

8.1                                 Binding Effect.  This Agreement shall bind
the Director and the Bank, and their beneficiaries, survivors, executors,
successors, administrators and transferees.

 

8.2                                 No Guarantee of Service.  This Agreement
does not give the Director the right to remain a member of the Bank’s Board of
Directors, nor does it interfere with the Bank’s right to terminate the service
of the Director. It also does not interfere with the Director’s right to
terminate his or her service at any time.

 

8.3                                 Non-Transferability.  Benefits under this
Agreement cannot be sold, transferred, assigned, pledged, attached or encumbered
in any manner.

 

8.4                                 Tax Withholding.  The Bank shall withhold
any taxes that are required to be withheld from the benefits provided under this
Agreement.

 

8.5                                 Applicable Law.  The Agreement and all
rights hereunder shall be governed by the laws of the Commonwealth of
Pennsylvania, except to the extent preempted by the laws of the United States of
America. This Agreement shall also be interpreted as is minimally required to
qualify any payment hereunder as not triggering any penalty on the Director
pursuant to Code Section 409A and the regulations promulgated thereunder.

 

8.6                                 Unfunded Arrangement.  The Director and
beneficiary are general unsecured creditors of the Bank for the payment of
benefits under this Agreement. The benefits represent the mere promise by the
Bank to pay such benefits. The rights to benefits are not subject in any manner
to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
attachment, or garnishment by creditors. Any insurance on the Director’s life is
a general asset of the Bank to which the Director and beneficiary have no
preferred or secured claim.

 

8.7                                 Recovery of Estate Taxes.  If the Director’s
gross estate for federal estate tax purposes includes any amount determined by
reference to and on account of this Agreement, and if the beneficiary is other
than the Director’s estate, then the Director’s estate shall be entitled to
recover from the beneficiary receiving such benefit under the terms of the
Agreement, an amount by which the total estate tax due by the Director’s estate,
exceeds the total estate tax which would have been payable if the value of such
benefit had not been included in the Director’s gross

 

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estate. If there is more than one person receiving such benefit, the right of
recovery shall be against each such person. In the event the beneficiary has a
liability hereunder, the beneficiary may petition the Bank for a lump sum
payment in an amount not to exceed the beneficiary’s liability hereunder.

 

8.8           Entire Agreement.  This Agreement constitutes the entire agreement
between the Bank and the Director as to the subject matter hereof. No rights are
granted to the Director by virtue of this Agreement other than those
specifically set forth herein.

 

8.9           Administration.  The Bank shall have powers which are necessary to
administer this Agreement, including but not limited to:

 

8.9.1                        Interpreting the provisions of this Agreement;

 

8.9.2                        Establishing and revising the method of accounting
for the Agreement;

 

8.9.3                        Maintaining a record of benefit payments; and

 

8.9.4                        Establishing rules and prescribing any forms
necessary or desirable to administer the Agreement.

 

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8.10                           Named Fiduciary.  The Bank shall be the named
fiduciary and plan administrator under this Agreement. The named fiduciary may
delegate to others certain aspects of the management and operation
responsibilities of the plan including the service of advisors and the
delegation of ministerial duties to qualified individuals.

 

IN WITNESS WHEREOF, the Director and a duly authorized Bank officer have signed
this Agreement.

 

 

BANK:

ATTEST:

RIVERVIEW NATIONAL BANK

 

 

/s/ Theresa M. Wasko

 

By

/s/ Robert M. Garst

 

 

 

 

 

 

Title

CEO

 

 

 

 

 

 

Date

May 19, 2010

 

By execution hereof, Riverview National Corporation, consents to and agrees to
be bound by the terms and conditions of this Agreement.

 

 

ATTEST:

CORPORATION:

 

RIVERVIEW NATIONAL

 

CORPORATION

 

 

/s/ Theresa M. Wasko

 

By

/s/ Robert M. Garst

 

 

 

 

 

 

Title

CEO

 

 

 

 

 

 

Date

May 19, 2010

 

 

WITNESS:

 

DIRECTOR:

 

 

 

 

 

 

/s/ Edna M. Reigle

 

/s/ Paul R. Reigle

 

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