Exhibit 10.1

FIRST NATIONAL CORPORATION

RESTRICTED STOCK UNIT AGREEMENT

This Restricted Stock Unit Agreement (the “Agreement”), dated as of
                    , by and between First National Corporation (the “Company”)
and                      evidences the grant on                      by the
Company of an award of restricted stock units (the “Restricted Stock Unit
Award”) to you and your acceptance of the Restricted Stock Unit Award.

The grant of this Restricted Stock Unit Award is made in accordance with the
First National Corporation 2014 Stock Incentive Plan (the “Plan”), a copy of
which is available from the Company upon request. The terms of the Plan are
incorporated into this Agreement by reference. In the case of any inconsistency
between the Plan and this Agreement, the terms of the Plan shall control. Any
term used in this Agreement that is defined in the Plan shall have the same
meaning given to that term in the Plan. References in this Agreement to the
“Company” also shall mean and refer to any business entity that, directly or
indirectly through one or more intermediaries, controls, is controlled by, or is
under common control with the Company, unless the context otherwise requires.

1. Award of Restricted Stock Units.

(a) The Board awards you              restricted stock units (the “Restricted
Stock Units”). Each Restricted Stock Unit represents the right to receive one
share of common stock of the Company (“Company Stock”), subject to the vesting
schedule in Section 2 and the other terms and conditions of this Agreement and
the Plan.

(b) The Restricted Stock Units shall be credited to a separate account
maintained for you on the books and records of the Company (the “Account”). All
amounts credited to the Account shall continue for all purposes to be part of
the general assets of the Company.

2. Vesting. Except as otherwise provided herein, provided that you remain an
employee of the Company through the applicable vesting date, the Restricted
Stock Units will vest in accordance with the following schedule (the period
during which the restrictions apply, the “Restricted Period”):

 

Vesting Date

   Number of Restricted Stock Units That Vest         

Once vested, the Restricted Stock Units become “Vested Units” and shares of
Company Stock representing the Vested Units will be issued in accordance with
the settlement procedures set forth in Section 6.

3. Effect of Termination.

(a) If your employment is terminated for any reason other than your death or
Disability before the vesting dates, all Restricted Stock Units that are not
then vested shall be automatically forfeited upon such termination of employment
and neither the Company nor any Affiliate shall have any further obligation to
you under this Agreement.

(b) If you die or become Disabled while employed, all Restricted Stock Units
that are not vested shall become Vested Units as of the date of your death or
Disability.

(c) Unless otherwise determined by the Board in accordance with Section 15 of
the Plan at the time of a Change in Control, a Change in Control shall have no
impact on the vesting of the Restricted Stock Units.

4. Restrictions. Subject to any exceptions set forth in this Agreement or the
Plan, during the Restricted Period and until such time as the Restricted Stock
Units are settled in accordance with Section 6, the Restricted Stock Units or
the rights relating thereto may not be assigned, alienated, pledged, attached,
sold or otherwise transferred or encumbered by you. Any attempt to assign,
alienate, pledge, attach, sell or otherwise transfer or encumber the Restricted
Stock Units or the rights

 

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relating thereto shall be wholly ineffective and, if any such attempt is made,
the Restricted Stock Units will be forfeited by you and all of your rights to
such units shall immediately terminate without any payment or consideration by
the Company. Notwithstanding any other provision in this Agreement to the
contrary, no shares of Company Stock underlying the Restricted Stock Units may
be sold until the expiration of six months from the Date of Grant.

5. Rights as a Shareholder.

(a) You shall not have any rights of a shareholder with respect to the shares of
Company Stock underlying the Restricted Stock Units unless and until the
Restricted Stock Units vest and are settled by the issuance of such shares of
Company Stock.

(b) Upon and following the settlement of the Restricted Stock Units, you shall
be the record owner of the shares of Company Stock underlying the Restricted
Stock Units unless and until such shares are sold or otherwise disposed of, and
as record owner shall be entitled to all rights of a shareholder of the Company
(including voting rights).

6. Settlement of Vested Restricted Stock Units. Subject to Section 10, effective
as of the vesting date the Company shall: (i) issue and deliver to you the
number of shares of Company Stock equal to the number of Vested Units; and
(ii) enter your name on the books of the Company as the shareholder of record
with respect to the shares of Company Stock delivered to you.

7. No Right to Continued Employment. Neither the Plan nor this Agreement shall
confer upon you any right to continued employment by the Company nor shall it
interfere in any way with the right of the Company to terminate your employment
at any time.

8. Change in Capital Structure. If the number of outstanding shares of the
Company Stock is increased or decreased as a result of a subdivision or
consolidation of shares, the payment of a stock dividend, stock split, or any
other change in the capitalization effective without receipt of consideration by
the Company, the number of Restricted Units awarded under this Agreement that
have not vested shall be appropriately adjusted by the Company, whose
determination shall be binding.

9. Governing Law. This Agreement is governed by the laws of the Commonwealth of
Virginia.

10. Tax Liability and Withholding.

(a) You shall be required to pay to the Company, and the Company shall have the
right to deduct from any compensation paid to you pursuant to the Plan, the
amount of any required withholding taxes in respect of the Restricted Stock
Units and to take all such other action as the Committee deems necessary to
satisfy all obligations for the payment of such withholding taxes. The Committee
may permit you to satisfy any federal, state or local tax withholding obligation
by any of the following means, or by a combination of such means:

 

  (i) tendering a cash payment;

 

  (ii) authorizing the Company to withhold shares of Company Stock from the
shares of Company Stock otherwise issuable or deliverable to you as a result of
the vesting of the Restricted Stock Units; provided, however, that no shares of
Common Stock shall be withheld with a value exceeding the minimum amount of tax
required to be withheld by law; or

 

  (iii) delivering to the Company previously owned and unencumbered shares of
Company Stock.

(b) Notwithstanding any action the Company takes with respect to any or all
income tax, payroll tax, or other tax-related withholding (“Tax-Related Items”),
the ultimate liability for all Tax-Related Items is and remains your
responsibility and the Company: (i) makes no representation or undertakings
regarding the treatment of any Tax-Related Items in connection with the grant,
vesting or settlement of the Restricted Stock Units or the subsequent sale of
any shares; and (ii) does not commit to structure the Restricted Stock Units to
reduce or eliminate your liability for Tax-Related Items.

11. Acceptance of Award. By signing below, you confirm your acceptance of the
Restricted Stock Unit Award and agreement to the terms and conditions set forth
in this Agreement, which, together with the terms of the Plan, shall become the
Company’s Restricted Stock Unit Award Agreement with you. You also agree to all
of the terms and conditions of the Plan. This Agreement will not be effective
until it is signed and returned.

 

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12. Entire Agreement, Amendment. This Agreement constitutes the entire agreement
between the Company and you and shall be binding upon your legatees,
distributees, and personal representatives and the successors of the Company.
This Agreement may only be amended by a writing signed by both the Company and
you.

13. Compliance with Law. The issuance and transfer of shares of Company Stock
shall be subject to compliance by the Company and you with all applicable
requirements of federal and state securities laws and with all applicable
requirements of any stock exchange on which the Company’s shares of common stock
may be listed. No shares of Company Stock shall be issued or transferred unless
and until any then applicable requirements of state and federal laws and
regulatory agencies have been fully complied with to the satisfaction of the
Company and its counsel.

14. Notices. Any notice required to be delivered to the Company under this
Agreement shall be in writing and addressed to the President and Chief Executive
Officer of the Company at the Company’s principal corporate offices. Any notice
required to be delivered to you under this Agreement shall be in writing and
addressed to you at your address as shown in the records of the Company. Either
party may designate another address in writing (or by such other method approved
by the Company) from time to time.

15. Section 409A. This Agreement is intended to comply with Section 409A of the
Internal Revenue Code of 1986, as amended (the “Code”) or an exemption
thereunder and shall be construed and interpreted in a manner that is consistent
with the requirements for avoiding additional taxes or penalties under
Section 409A of the Code. Notwithstanding the foregoing, the Company makes no
representations that the payments and benefits provided under this Agreement
comply with Section 409A of the Code and in no event shall the Company be liable
for all or any portion of any taxes, penalties, interest or other expenses that
may be incurred by you on account of non-compliance with Section 409A of the
Code.

Signatures appear on the following page.

 

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

 

FIRST NATIONAL CORPORATION By:

 

Name Title

 

Name Title

 

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