rvb_8k1119ex101.htm


    Exhibit
10.1


       

       

       

       

       

       

      Investment
Agreement

       

      


       

      dated
as of ______________, 2009, between

       

      


       

      RIVER
VALLEY BANCORP

       

      


       

      and

       

      


       

      ________________________________

       


      
        
           


        

        
           


          
            

          

        

        
           


        

      


      TABLE
OF CONTENTS

       

      Page

       

      


      
        	
                Article
      I  PURCHASE; CLOSING

              	
                1

              
	
                1.1

              	
                Purchase.

              	
                1

              
	
                1.2

              	
                Series
      A Closing.

              	
                1

              
	 
      	 
      
	
                Article
      II  REPRESENTATIONS AND WARRANTIES

              	3
	
                2.1

              	
                Disclosure.

              	
                3

              
	
                2.2

              	
                Representations
      and Warranties of the Company.

              	
                4

              
	
                2.3

              	
                Representations
      and Warranties of Purchaser.

              	
                7

              
	 
      	 
      
	
                Article
      III  COVENANTS

              	
                10

              
	
                3.1

              	
                Filings;
      Other Actions.

              	
                10

              
	
                3.2

              	
                Confidentiality.

              	
                10

              
	
                3.3

              	
                Conduct
      of the Business.

              	
                10

              
	 
      	 
      
	
                Article
      IV  ADDITIONAL AGREEMENTS

              	
                11

              
	
                4.1

              	
                Legend.

              	
                11

              
	
                4.2

              	
                Reservation
      for Issuance.

              	
                11

              
	
                4.3

              	
                Certain
      Transactions.

              	
                11

              
	
                4.4

              	
                Certificate
      of Designations.

              	
                11

              
	 
      	 
      
	
                Article
      V  TERMINATION

              	
                11

              
	
                5.1

              	
                Termination.

              	
                11

              
	
                5.2

              	
                Effects
      of Termination.

              	
                12

              
	 
      	 
      
	
                Article
      VI  MISCELLANEOUS

              	
                12

              
	
                6.1

              	
                Expenses.

              	
                12

              
	
                6.2

              	
                Amendment;
      Waiver.

              	
                12

              
	
                6.3

              	
                Counterparts
      and Facsimile.

              	
                12

              
	
                6.4

              	
                Governing
      Law.

              	
                12

              
	
                6.5

              	
                WAIVER
      OF JURY TRIAL.

              	
                12

              
	
                6.6

              	
                Notices.

              	
                13

              
	
                6.7

              	
                Entire
      Agreement; Assignment.

              	
                13

              
	
                6.8

              	
                Interpretation;
      Other Definitions.

              	
                13

              
	
                6.9

              	
                Captions.

              	
                14

              
	
                6.10

              	
                Severability.

              	
                14

              
	
                6.11

              	
                No
      Third Party Beneficiaries.

              	
                14

              
	
                6.12

              	
                Time
      of Essence.

              	
                14

              
	
                6.13

              	
                Public
      Announcements.

              	
                14

              
	
                6.14

              	
                Specific
      Performance.

              	
                15

              


      

      



      
        
           


        

        
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      LIST
OF EXHIBITS

       

      Exhibit
A:     Certificate of Designations for Series A
Preferred Stock

       

      Exhibit
B:     Form of Escrow Agreement

       


      
        
           


        

        
          ii

          
            

          

        

        
           


        

      


      Investment
Agreement

       

      This Investment
Agreement, dated as of _____________ ___, 2009 (this “Agreement”), between River Valley Bancorp,
an Indiana corporation (the “Company”), and ______________________
(“Purchaser”).

       

      RECITALS:

       

      A.           The Investment.
Subject to the terms and conditions of this Agreement, the Company has
authorized the issuance and sale of up to 8,000 shares of Fixed Rate Cumulative
Perpetual Preferred Stock, Series A, without par value, liquidation value $1,000
per share, of the Company, having the terms set forth in Exhibit A (the “Series A Preferred
Stock”).

       

      B.           The Shares. The term
“Shares” refers to the
shares of Series A Preferred Stock which are to be purchased or issued and
acquired under this Agreement. When purchased, the Series A Preferred Stock will
be evidenced by share certificates consistent with the terms set forth in the
Certificate of Designations creating the Series A Preferred Stock. The
Certificate of Designations creating the Series A Preferred Stock (the “Certificate of Designations”)
shall be made a part of the Company’s Articles of Incorporation, as amended (the
“Articles of
Incorporation”) by the filing of the Certificate of Designations with the
Secretary of State of Indiana (the “Indiana
Secretary”).

       

      NOW, THEREFORE, in
consideration of the premises, and of the representations, warranties, covenants
and agreements set forth herein, the parties agree as follows:

       

      ARTICLE
I

      PURCHASE;
CLOSING

       

      1.1           Purchase.  On
the terms and subject to the conditions set forth herein, Purchaser will
purchase from the Company, and the Company will issue and sell to Purchaser, the
number of Shares at the purchase price shown below:

       

      


      
        	
                
                  Series
      A Preferred Stock

                

              	 	
                
                  Number
      of Shares to be Purchased

                

              	 	
                
                  Price
      Per Share (In Dollars)

                

              	 	
                
                  Aggregate
      Purchase Price (In Dollars)

                

              
	 
      	 	 
      	 	 
      	 	 
      
	 
      	 	
                __________

              	 	
                $1,000.00

              	 	
                $__________

              


      

      


      1.2           Series A
Closing.

       

      (a)           Time and Date of Series A
Closing. 
Subject to the satisfaction or waiver of the conditions set forth in this
Section 1.2, the closing of the purchase and issuance of the Series A Preferred
Stock (the “Series A
Closing”) shall occur no later than five days following the satisfaction
or waiver (by the party entitled to grant such waiver) of all of the conditions
set forth in this Section 1.2 (other than those conditions that by their nature
are to be satisfied at the Series A Closing, but subject to fulfillment or
waiver of those conditions), at the offices of Barnes & Thornburg LLP
located at 11 South Meridian

       


      
        
           


        

        
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      Street,
Indianapolis, Indiana 46204, or such other date and/or location as agreed by the
parties. The date of the Series A Closing is referred to as the “Series A Closing
Date.”

       

      (b)           Escrow
Agreement. 
 As of the date of this Agreement, the Purchaser shall deposit the
Aggregate Purchase Price for the Series A Preferred Stock listed in Section 1.1
(the “Escrow Funds”)
with River Valley Financial Bank, a federal savings association and a wholly
owned subsidiary of the Company (the “Bank”), to be held in escrow
pending the satisfaction or waiver of the conditions and obligations set forth
in this Section 1.2, in accordance with the terms of an Escrow Agreement, by and
among the Company and the Bank, in substantially the form attached hereto as
Exhibit B (the “Escrow
Agreement”).

       

      (c)           Series A Closing
Conditions.

       

      (1)           The
obligation of Purchaser, on the one hand, and the Company, on the other hand, to
effect the Series A Closing is subject to the fulfillment or written waiver by
Purchaser and the Company prior to the Series A Closing of the following
conditions:

       

      (A)           no
provision of any applicable law or regulation and no judgment, injunction, order
or decree shall prohibit the Series A Closing or shall prohibit or restrict the
Purchaser from owning any Shares in accordance with the terms thereof and no
lawsuit shall have been commenced by any court, administrative agency or
commission or other governmental authority or instrumentality, whether federal,
state, local or foreign, or any applicable industry self-regulatory organization
(each, a “Governmental
Entity”), and no written notice shall have been issued and not withdrawn
by any Governmental Entity of competent jurisdiction, seeking to effect any of
the foregoing; and

       

      (B)           the
Company shall have entered into Investment Agreements with the Purchaser and
other purchasers with respect to the acquisition of at least 5,000 shares of
Series A Preferred Stock, and the Bank shall have received in escrow a minimum
of $5,000,000 in proceeds of the sale of such minimum number of shares of Series
A Preferred Stock.

       

      (2)           The
obligation of Purchaser to effect the Series A Closing is also subject to the
fulfillment or written waiver by Purchaser prior to the Series A Closing of each
of the following additional conditions:

       

      (A)           the
Company shall have performed in all material respects all other obligations
required to be performed by it at or prior to the Series A Closing pursuant to
this Agreement; and

       

      (B)           Purchaser
shall have received a certificate signed on behalf of the Company by an
executive officer certifying to the effect that the condition set forth in
Section 1.2(c)(2)(A) has been satisfied.

       

      (3)           The
obligation of the Company to effect the Series A Closing is also subject to the
fulfillment or written waiver by the Company prior to the Series A Closing of
each of the following additional conditions:

       


      
        
           


        

        
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      (A)           Purchaser
has performed in all material respects all obligations required to be performed
by it at or prior to the Series A Closing, as the case may be, under this
Agreement.

       

      (B)           The
Company shall have received an aggregate purchase price of $_____ for _____
shares of Series A Preferred Stock which shall be held by the Bank pursuant to
the terms of the Escrow Agreement.

       

      (d)           Delivery. Subject to
the satisfaction or waiver on the Series A Closing Date of the applicable
conditions to the Series A Closing in Section 1.2(c), on the Series A Closing
Date:

       

      (1)           the
Company will deliver to Purchaser a preferred stock certificate or certificates
representing the number of shares of Series A Preferred Stock listed in Section
1.1; and

       

      (2)           the
Purchaser will authorize the release of the Escrow Funds to the Company and will
deliver all documentation and perform all actions required by the Escrow
Agreement to release such Escrow Funds.

       

      For the
avoidance of doubt, following the occurrence of the Series A Closing, the
obligations of the Company to deliver the Series A Preferred Stock on the Series
A Closing Date and Purchaser to pay for the Series A Preferred Stock on the
Series A Closing Date shall become irrevocable and unconditional save for the
condition that the other party shall have made the required delivery of the
Series A Preferred Stock or payment, as applicable, as stated in Sections
1.2(d)(1) and (2).

       

      ARTICLE
II

      REPRESENTATIONS AND
WARRANTIES

       

      2.1           Disclosure.

       

      (a)           As
used in this Agreement, the term “Material Adverse Effect” means
any circumstance, event, change, development or effect that (1) is material and
adverse to the business, assets, results of operations or financial condition of
the Company and Company Subsidiaries (as hereinafter defined) taken as a whole
or (2) would materially impair the ability of the Company to perform its
obligations under this Agreement or to consummate the Series A Closing;
provided, however, that in determining whether a Material Adverse Effect has
occurred, there shall be excluded any effect to the extent resulting from the
following: (A) changes, after the date hereof, in U.S. generally accepted
accounting principles (“GAAP”) or regulatory
accounting principles generally applicable to banks, savings associations or
their holding companies, (B) changes, after the date hereof, in applicable laws,
rules and regulations or interpretations thereof by Governmental Entities, (C)
actions or omissions of the Company expressly required by the terms of this
Agreement or taken with the prior written consent of Purchaser, (D) changes in
general economic, monetary or financial conditions, including changes in
prevailing interest rates, credit markets, secondary mortgage market conditions
or housing price appreciation/depreciation trends, (E) changes in the market
price or trading volumes of the Common Stock (as hereinafter defined) (but not
the underlying causes of such changes), (F) the failure of the Company to meet
any internal or public projections, forecasts, estimates or guidance (including
guidance as to “earnings drivers”) for any

       


      
        
           


        

        
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      period
ending on or after December 31, 2008 (but not the underlying causes of such
failure), (G) changes in global or national political conditions, including the
outbreak or escalation of war or acts of terrorism and (H) the public disclosure
of this Agreement or the transactions contemplated hereby.

       

      (b)           “Previously Disclosed” with
regard to the Company, means information publicly disclosed by the Company in
(A) its Annual Report on Form 10-K for the fiscal year ended December 31, 2008,
as filed by it with the Securities and Exchange Commission (“SEC”) on March 18, 2009, (B)
its Definitive Proxy Statement on Schedule 14A, as filed by it with the SEC on
March 18, 2009, (C) its Quarterly Reports on Form 10-Q, as filed by it with the
SEC on May 15, 2009 and August 13, 2009, (D) and
any Current Report on Form 8-K filed or furnished by it with the SEC since
January 1, 2009 and publicly available prior to the date of this Agreement, or
(E) its Offering Document Booklet provided to the Purchaser.

       

      2.2           Representations
and Warranties of the Company.   
Except as Previously Disclosed, the Company represents and warrants to
Purchaser, as of the date of this Agreement and as of the Series A Closing Date,
that:

       

      (a)           Organization and
Authority.

       

      (1)           The
Company is a corporation duly organized and validly existing under the laws of
the State of Indiana, is duly qualified to do business and is in good standing
in all jurisdictions where its ownership or leasing of property or the conduct
of its business requires it to be so qualified and where failure to be so
qualified would have, individually or in the aggregate, a Material Adverse
Effect, and has the corporate power and authority to own its properties and
assets and to carry on its business as it is now being conducted. The Company is
duly registered as a savings and loan holding company under the Home Owner’s
Loan Act of 1933, as amended (“HOLA”).

       

      (2)           Each
Company Subsidiary is duly organized and validly existing under the laws of its
jurisdiction of organization, is duly qualified to do business and is in good
standing in all jurisdictions where its ownership or leasing of property or the
conduct of its business requires it to be so qualified and where failure to be
so qualified would have, individually or in the aggregate, a Material Adverse
Effect, and has the corporate power and authority and governmental
authorizations to own its properties and assets and to carry on its business as
it is being conducted. The Bank is duly organized and validly existing under
federal law and its deposit accounts are insured up to applicable limits by the
Federal Deposit Insurance Corporation, and all premiums and assessments required
to be paid in connection therewith have been paid when due. As used herein,
“Subsidiary” means, with
respect to any person, any corporation, partnership, joint venture, limited
liability company or other entity (x) of which such person or a subsidiary of
such person is a general partner or (y) of which a majority of the voting
securities or other voting interests, or a majority of the securities or other
interests of which having by their terms ordinary voting power to elect a
majority of the board of directors or persons performing similar functions with
respect to such entity, is directly or indirectly owned by such person and/or
one or more

       


      
        
           


        

        
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      subsidiaries
thereof; and “Company
Subsidiary” means any Subsidiary of the Company, including the
Bank.

       

      (b)           Capitalization. The
authorized capital stock of the Company consists of 5,000,000 shares of Common
Stock, without par value (“Common Stock”), and 2,000,000
shares of preferred stock, without par value, of the Company (the “Company Preferred Stock”). As
of July 31, 2009, there were 1,504,472 shares of Common Stock outstanding and no
shares of Company Preferred Stock outstanding.

       

      (c)           Company’s
Subsidiaries. The Company owns, directly or indirectly, all of the issued
and outstanding shares of capital stock of or all other equity interests in each
of the Company Subsidiaries, free and clear of any liens, charges, adverse
rights or claims, pledges, covenant, title defect, security interests and other
encumbrances of any kind (“Liens”), and all of such
shares or equity interests are duly authorized and validly issued and are fully
paid, nonassessable and free of preemptive rights, with no personal liability
attaching to the ownership thereof. No Company Subsidiary has or is bound by any
outstanding subscriptions, options, warrants, calls, commitments or agreements
of any character calling for the purchase or redemption or issuance of any
shares of capital stock or any other equity security of such Company Subsidiary
or any securities representing the right to purchase or otherwise receive any
shares of capital stock or any other equity security of such Company
Subsidiary.

       

      (d)           Authorization.

       

      (1)           The
Company has the corporate power and authority to enter into this Agreement and
to carry out its obligations hereunder. The execution, delivery and performance
of this Agreement by the Company and the consummation of the transactions
contemplated hereby have been duly and unanimously authorized by the Board of
Directors of the Company. This Agreement has been duly and validly executed and
delivered by the Company and, assuming due authorization, execution and delivery
by Purchaser, is a valid and binding obligation of the Company enforceable
against the Company in accordance with its terms (except as enforcement may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium,
fraudulent transfer and similar laws of general applicability relating to or
affecting creditors’ rights or by general equity principles). No other corporate
proceedings or shareholder actions are necessary for the execution and delivery
by the Company of this Agreement, the performance by it of its obligations
hereunder or the consummation by it of the transactions contemplated
hereby.

       

      (2)           Neither
the execution and delivery by the Company of this Agreement, nor the
consummation of the transactions contemplated hereby, nor compliance by the
Company with any of the provisions hereof, will (A) violate, conflict with, or
result in a breach of any provision of, or constitute a default (or an event
which, with notice or lapse of time or both, would constitute a default) under,
or result in the termination of, or result in the loss of any benefit or
creation of any right on the part of any third party under, or accelerate the
performance required by, or result in a right of termination or acceleration of,
or result in the creation of any Lien upon any of the material properties or
assets of the Company

       


      
        
           


        

        
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      or any
Company Subsidiary under any of the terms, conditions or provisions of (i) its
Articles of Incorporation or by-laws (or similar governing documents) or the
articles of organization, charter, by-laws or other governing instrument of any
Company Subsidiary, or (ii) any material note, bond, mortgage, indenture, deed
of trust, license, lease, agreement or other instrument or obligation to which
the Company or any Company Subsidiary is a party or by which it may be bound, or
to which the Company or any Company Subsidiary or any of the properties or
assets of the Company or any Company Subsidiary may be subject, or (B) subject
to compliance with the statutes and regulations referred to in Section 2.2(e),
violate any law, statute, ordinance, rule, regulation, permit, concession,
grant, franchise or any judgment, ruling, order, writ, injunction or decree
applicable to the Company or any Company Subsidiary or any of their respective
properties or assets, except, in the case of clauses (A)(ii) and (B), for such
violations, conflicts and breaches as would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse
Effect.

       

      (e)           Governmental
Consents. Other than compliance with exemptions under the Securities Act
of 1933, as amended (the “Securities Act”) and the securities or blue sky laws
of the various states, no material notice to, registration, declaration or
filing with, exemption or review by, or authorization, order, consent or
approval of, any Governmental Entity, or expiration or termination of any
statutory waiting period, is necessary for the consummation by the Company of
the transactions contemplated by this Agreement.

       

      (f)           Financial Statements.
Each of the consolidated balance sheets of the Company and the Company
Subsidiaries and the related consolidated statements of income, shareholders’
equity and cash flows, together with the notes thereto (collectively, the “Company Financial
Statements”), included in any report, registration, document filing,
statement and submission required to be filed with the SEC after December 31,
2008, (1) have been prepared from, and are in accordance with, the books and
records of the Company and the Company Subsidiaries, (2) complied as to form, as
of their respective date of filing with the SEC, in all material respects with
applicable accounting requirements and with the published rules and regulations
of the SEC with respect thereto, (3) have been prepared in accordance with GAAP
applied on a consistent basis during the periods involved and (4) present fairly
in all material respects the consolidated financial position of the Company and
the Company Subsidiaries as of the dates set forth therein and the consolidated
results of operations, changes in shareholders’ equity and cash flows of the
Company and the Company Subsidiaries for the periods stated therein, subject, in
the case of any unaudited financial statements, to normal recurring year-end
audit adjustments.

       

      (g)           Absence of Certain
Changes. Since June 30, 2009, until the date hereof, (1) the Company and
the Company Subsidiaries have conducted their respective businesses in all
material respects in the ordinary course, consistent with prior practice, (2)
the Company has not made or declared any distribution in cash or in kind to its
shareholders, other than ordinary course cash dividends to its shareholders, or
issued or repurchased any shares of its capital stock or other equity interests
and (3) no event or

       


      
        
           


        

        
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      events
have occurred that, individually or in the aggregate, has had or would
reasonably be expected to have a Material Adverse Effect.

       

      (h)           Status of Shares. The
shares of Series A Preferred Stock (upon filing of the Certificate of
Designations with the Indiana Secretary) have been duly authorized by all
necessary corporate action. When issued and sold against receipt of the
consideration therefor as provided in this Agreement, such shares of Series A
Preferred Stock will be validly issued, fully paid and nonassessable, will not
subject the holders thereof to personal liability and will not be subject to
preemptive rights of any other shareholder of the Company.

       

      2.3           Representations
and Warranties of Purchaser.   
Purchaser hereby represents and warrants to the Company, as of the date of this
Agreement and as of the Series A Closing Date that:

       

      (a)           Organization and
Authority. If Purchaser is a partnership, corporation, limited liability
company or other entity, then such Purchaser is duly organized, validly existing
and in good standing under the laws of the jurisdiction of its organization, is
duly qualified to do business and is in good standing in all jurisdictions where
its ownership or leasing of property or the conduct of its business requires it
to be so qualified and where failure to be so qualified would be reasonably
expected to materially and adversely affect Purchaser’s ability to perform its
obligations under this Agreement or consummate the transactions contemplated
hereby on a timely basis, and Purchaser has the corporate or other power and
authority and governmental authorizations to own its properties and assets and
to carry on its business as it is now being conducted.

       

      (b)           Authorization.

       

      (1)           If
Purchaser is a partnership, corporation, limited liability company or other
entity, then (i) such Purchaser has the corporate or other power and authority
to enter into this Agreement and to carry out its obligations hereunder; and
(ii) the execution, delivery and performance of this Agreement by Purchaser and
the consummation of the transactions contemplated hereby have been duly
authorized by Purchaser’s board of directors, general partner or managing
members, as the case may be, and no further approval or authorization by any of
its partners or other equity owners, as the case may be, is required. This
Agreement has been duly and validly executed and delivered by Purchaser and
assuming due authorization, execution and delivery by the Company, is a valid
and binding obligation of Purchaser enforceable against Purchaser in accordance
with its terms (except as enforcement may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent transfer and similar laws of
general applicability relating to or affecting creditors’ rights or by general
equity principles).

       

      (2)           Neither
the execution, delivery and performance by Purchaser of this Agreement, nor the
consummation of the transactions contemplated hereby, nor compliance by
Purchaser with any of the provisions hereof, will (A) violate, conflict with, or
result in a breach of any provision of, or constitute a default (or an event
which, with notice or lapse of time or both, would constitute a default) under,
or result in the termination of, or accelerate the performance required
by,

       


      
        
           


        

        
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      or result
in a right of termination or acceleration of, or result in the creation of any
Lien upon any of the properties or assets of Purchaser under any of the terms,
conditions or provisions of (i) its articles of incorporation, articles of
organization, bylaws, operating agreement, partnership agreement or similar
governing documents, if applicable or (ii) any note, bond, mortgage, indenture,
deed of trust, license, lease, agreement or other instrument or obligation to
which Purchaser is a party or by which it may be bound, or to which Purchaser or
any of the properties or assets of Purchaser may be subject, or (B) subject to
compliance with the statutes and regulations referred to in the next paragraph,
violate any law, statute, ordinance, rule or regulation, permit, concession,
grant, franchise or any judgment, ruling, order, writ, injunction or decree
applicable to Purchaser or any of its properties or assets, except, in the case
of clauses (A)(ii) and (B), for such violations, conflicts and breaches as would
not reasonably be expected to materially and adversely affect Purchaser’s
ability to perform its respective obligations under this Agreement or consummate
the transactions contemplated hereby on a timely basis.

       

      (c)           Governmental
Consents. Other than compliance with exemptions under the Securities Act
and the securities or blue sky laws of the various states, no notice to,
registration, declaration or filing with, exemption or review by, or
authorization, order, consent or approval of, any Governmental Entity, nor
expiration or termination of any statutory waiting period, is necessary for the
consummation by Purchaser of the transactions contemplated by this
Agreement.

       

      (d)           Purchase for
Investment/Knowledge and Experience. Purchaser acknowledges that the
Shares have not been registered under the Securities Act or under any state
securities laws. Purchaser is acquiring the Shares for investment only and for
the Purchaser’s own account and not with a view to, or for sale in connection
with, the distribution thereof, nor with any present intention of distributing
or selling any of the Shares.  The Purchaser is acquiring the Shares
pursuant to an exemption from registration under the Securities Act and (1) will
not sell or otherwise dispose of any of the Shares, except in compliance with
the registration requirements or exemption provisions of the Securities Act and
any other applicable securities laws, and (2) either (A) alone or with a
purchaser representative has such knowledge and experience in financial and
business matters and in investments of this type that it is capable of
evaluating the merits and risks of its investment in the Shares and of making an
informed investment decision, and/or (B) is an “accredited investor” (as that
term is defined in Rule 501 of the Securities Act).

       

      (e)           Financial Capability.
The Purchaser has the available funds necessary to consummate the Series A
Closing on the terms and conditions contemplated by this
Agreement.  The Purchaser is capable of bearing the economic risks of
the investment including the possible loss of the entire
investment.

       

      (f)           Disclosure of
Information. The Purchaser has received or has had full access to all the
information it considers necessary or appropriate to make an informed investment
decision with respect to the Shares to be purchased under this Agreement. The
Purchaser has had an opportunity to ask questions and receive answers from the
Company regarding the terms and conditions of the offering of the Shares and to
obtain

       


      
        
           


        

        
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      additional
information (to the extent the Company possessed such information or could
acquire it without unreasonable effort or expense) necessary to verify any
information furnished to the Purchaser or to which Purchaser had access. The
Purchaser understands and acknowledges that any information issued by the
Company, (i) was intended to describe the aspects of the Company’s business and
prospects which the Company believes to be material, but were not necessarily an
exhaustive description, and (ii) may have contained forward-looking statements
involving known and unknown risks and uncertainties which may cause the
Company’s actual results in future periods or plans for future periods to differ
materially from what was anticipated and that no representations or warranties
were or are being made with respect to any such forward-looking statements,
provided that the Company believes such statements were reasonable when made and
made such statements in good faith.

       

      (g)           Restricted Shares.
The Purchaser understands that the Shares are characterized as “restricted
securities” under the Securities Act inasmuch as they are being acquired from
the Company in a transaction not involving a public offering and that under the
Securities Act and applicable regulations thereunder such securities may be
resold without registration under the Securities Act only in certain limited
circumstances. Purchaser must bear the economic risk of this investment
indefinitely unless the Shares are registered pursuant to the Securities Act, or
an exemption from registration is available. Purchaser understands that the
Company has no present intention of registering the Shares. Purchaser also
understands that there is no assurance that any exemption from registration
under Securities Act will be available and that, even if available, such
exemption may not allow Purchaser to transfer all or any portion of the Shares
under the circumstances, in the amounts or at the times Purchaser might propose.
In this connection, Purchaser represents that Purchaser is aware of the
provisions of Rule 144 of the SEC, as presently in effect, and understands the
resale limitations imposed thereby and by the Securities Act.

       

      (h)           Brokers and Finders.
Neither Purchaser nor its Affiliates, nor any of their respective officers,
directors, employees or agents has employed any broker or finder or incurred any
liability for any financial advisory fees, brokerage fees, commissions or
finder’s fees, and no broker or finder has acted directly or indirectly for
Purchaser, in connection with this Agreement or the transactions contemplated
hereby.

       

      (i)           Reliance on Representations
and Warranties. The Purchaser understands that the Company will be
relying on Purchaser’s representations made herein in determining whether the
offering of the Series A Preferred Stock is exempt from registration under the
Securities Act and under applicable state securities laws.

       

      (j)           Tax and Legal
Matters.  The Purchaser has relied on his, her or its own tax
and legal advisor and/or investment counselor with respect to the income tax and
investment considerations relevant to the purchase of the Shares.

       

      (k)           No General
Solicitation.  The Purchaser did not learn of the offering of
the Series A Preferred Stock through any general solicitation or general
advertisement.

       

      (l)           No Public Market for
Shares.  The Purchaser understands that there is no public
market for the Shares and that such a public market is not likely to develop in
the future.

       


      
        
           


        

        
          9

          
            

          

        

        
           


        

      


      (m)           No Registration
Obligation.  The Purchaser acknowledges and understands that
the Company has no obligation to register the Shares under federal or state
securities laws at any time, and there is no obligation on the part of the
Company or any holder of Shares or any other person to repurchase or purchase
the Shares from such Purchaser or its Affiliates.

       

      


      ARTICLE
III

      COVENANTS

       

      3.1           Filings;
Other Actions.  
 Purchaser and the Company will cooperate and consult with the other and
use reasonable best efforts to prepare and file all necessary documentation, to
effect all necessary applications, notices, petitions, filings and other
documents, and to obtain all necessary permits, consents, orders, approvals and
authorizations of, or any exemption by, all third parties and Governmental
Entities, and the expiration or termination of any applicable waiting period,
necessary or advisable to consummate the transactions contemplated by this
Agreement, and to perform the covenants contemplated by this Agreement. Each
party shall execute and deliver both before and after the Series A Closing such
further certificates, agreements and other documents and take such other actions
as the other parties may reasonably request to consummate or implement such
transactions or to evidence such events or matters. In particular, Purchaser
will use its reasonable best efforts to promptly obtain or submit, and the
Company will cooperate as may reasonably be requested by Purchaser to help
Purchaser promptly obtain or submit, as the case may be, as promptly as
practicable, all notices to and, to the extent required by applicable law or
regulation, consents, approvals or exemptions from Governmental Entities for the
transactions contemplated by this Agreement.

       

      3.2           Confidentiality.  
Each party to this Agreement will hold, and will cause its respective Affiliates
and their directors, officers, employees, agents, consultants and advisors to
hold, in strict confidence, unless disclosure to a regulatory authority is
necessary or appropriate in connection with any necessary regulatory approval or
unless disclosure is required by judicial or administrative process or, in the
written opinion of its counsel, by other requirement of law or the applicable
requirements of any regulatory agency or relevant stock exchange, all non-public
records, books, contracts, instruments, computer data and other data and
information (collectively, “Information”) concerning the
other party hereto furnished to it by such other party or its representatives
pursuant to this Agreement (except to the extent that such information can be
shown to have been (1) previously known by such party on a non-confidential
basis, (2) in the public domain through no fault of such party or (3) later
lawfully acquired from other sources by the party to which it was furnished),
and neither party hereto shall release or disclose such Information to any other
person, except its auditors, attorneys, financial advisors, other consultants
and advisors.

       

      3.3           Conduct
of the Business. 
  Prior to the earlier of the Series A Closing Date and the
termination of this Agreement pursuant to Section 5.1 (the “Pre-Closing Period”), the
Company shall, and shall cause each Company Subsidiary to, use commercially
reasonable efforts to carry on its business in the ordinary course of business
and use reasonable best efforts to maintain and preserve its and such Company
Subsidiary’s business (including its organization, assets, properties, goodwill
and insurance coverage) and preserve its business relationships with customers,
strategic partners, suppliers, distributors and others having business dealings
with it; provided, however, that nothing in this sentence shall limit or require
any actions that the Board

       


      
        
           


        

        
          10

          
            

          

        

        
           


        

      


      of
Directors of the Company may, in good faith, determine to be inconsistent with
their duties or the Company’s obligations under applicable law.

       

      ARTICLE
IV

      ADDITIONAL
AGREEMENTS

       

      4.1           Legend.



       

      (a)           Purchaser
agrees that all certificates or other instruments representing the Shares
subject to this Agreement will bear a legend substantially to the following
effect:

       

      THE
SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY
NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT WHILE A REGISTRATION
STATEMENT RELATING THERETO IS IN EFFECT UNDER SUCH ACT AND APPLICABLE STATE
SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT OR
SUCH LAWS.

       

      (b)           Upon
request of Purchaser, upon receipt by the Company of an opinion of counsel
reasonably satisfactory to the Company to the effect that such legend is no
longer required under the Securities Act and applicable state laws, the Company
shall promptly cause the legend to be removed from any certificate for any
Shares to be transferred in accordance with the terms of this Agreement.
Purchaser acknowledges that the Shares have not been registered under the
Securities Act or under any state securities laws and agrees that it will not
sell or otherwise dispose of any of the Shares, except in compliance with the
registration requirements or exemption provisions of the Securities Act and any
other applicable securities laws.

       

      4.2           Reservation
for Issuance.  
 The Company has reserved that number of shares of Series A Preferred Stock
sufficient for issuance of the Shares to the Purchaser.

       

      4.3           Certain
Transactions.  
 The Company will not merge or consolidate into, or sell, transfer or lease
all or substantially all of its property or assets to, any other party unless
the successor, transferee or lessee party, as the case may be (if not the
Company), assumes the due and punctual performance and observance of each and
every covenant and condition of this Agreement to be performed and observed by
the Company.

       

      4.4           Certificate
of Designations.  
 In connection with the Series A Closing, the Company shall file the
Certificate of Designations in the State of Indiana, and the Certificate of
Designations shall continue to be in full force and effect as of the Series A
Closing Date.

       

      ARTICLE
V

      TERMINATION

       

      5.1           Termination.  
This Agreement may be terminated prior to the Series A Closing:

       

      (a)           by
mutual written agreement of the Company and Purchaser;

       

      (b)           by
the Company or Purchaser, upon written notice to the other party, in the event
that the Series A Closing does not occur on or before December 31, 2009;
provided, however, that the right to terminate this Agreement pursuant to this
Section

       


      
        
           


        

        
          11

          
            

          

        

        
           


        

      


      5.1(b)
shall not be available to any party whose failure to fulfill any obligation
under this Agreement shall have been the cause of, or shall have resulted in,
the failure of the Series A Closing to occur on or prior to such date;
or

       

      (c)           by
the Company or Purchaser, upon written notice to the other party, in the event
that any Governmental Entity shall have issued any order, decree or injunction
or taken any other action restraining, enjoining or prohibiting any of the
transactions contemplated by this Agreement, and such order, decree, injunction
or other action shall have become final and nonappealable.

       

      5.2           Effects
of Termination.  
 In the event of any termination of this Agreement as provided in Section
5.1, no party will have any further rights or obligations under this Agreement
(other than Article VI, which shall remain in full force and effect) provided
that nothing herein shall relieve any party from liability for any breach of
this Agreement.

       

      ARTICLE
VI

      MISCELLANEOUS

       

      6.1           Expenses.  
 Each of the parties will bear and pay all other costs and expenses
incurred by it or on its behalf in connection with the transactions contemplated
pursuant to this Agreement.

       

      6.2           Amendment;
Waiver.  
 No amendment or waiver of any provision of this Agreement will be
effective with respect to any party unless made in writing and signed by an
officer of a duly authorized representative of such party. No failure or delay
by any party in exercising any right, power or privilege hereunder shall operate
as a waiver thereof nor shall any single or partial exercise thereof preclude
any other or further exercise thereof or the exercise of any other right, power
or privilege. The conditions to each party’s obligation to consummate the Series
A Closing are for the sole benefit of such party and may be waived by such party
in whole or in part to the extent permitted by applicable law. No waiver of any
party to this Agreement will be effective unless it is in a writing signed by a
duly authorized officer of the waiving party that makes express reference to the
provision or provisions subject to such waiver. The rights and remedies herein
provided shall be cumulative and not exclusive of any rights or remedies
provided by law.

       

      6.3           Counterparts
and Facsimile.  
 For the convenience of the parties hereto, this Agreement may be executed
in any number of separate counterparts, each such counterpart being deemed to be
an original instrument, and all such counterparts will together constitute the
same agreement. Executed signature pages to this Agreement may be delivered by
facsimile and such facsimiles will be deemed as sufficient as if actual
signature pages had been delivered.

       

      6.4           Governing
Law.  
 This Agreement will be governed by and construed in accordance with the
laws of the State of Indiana applicable to contracts made and to be performed
entirely within such State. The parties hereby irrevocably and unconditionally
consent to submit to the exclusive jurisdiction of the state and federal courts
located in the State of Indiana for any actions, suits or proceedings arising
out of or relating to this Agreement and the transactions contemplated
hereby.

       

      6.5           WAIVER
OF JURY TRIAL.  
 EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO
TRIAL BY JURY IN ANY LEGAL

       


      
        
           


        

        
          12

          
            

          

        

        
           


        

      


      PROCEEDING
ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.

       

      6.6           Notices.  
 Any notice, request, instruction or other document to be given hereunder
by any party to the other will be in writing and will be deemed to have been
duly given (a) on the date of delivery if delivered personally or by telecopy or
facsimile, upon confirmation of receipt, (b) on the first business day following
the date of dispatch if delivered by a recognized next-day courier service, or
(c) on the third business day following the date of mailing if delivered by
registered or certified mail, return receipt requested, postage prepaid. All
notices hereunder shall be delivered as set forth below, or pursuant to such
other instructions as may be designated in writing by the party to receive such
notice.

       

      
        	
                 
      

              	
                (i)

              	
                If
      to Purchaser, to the address set forth on the signature page
      hereto.

              


      

       

      
        	
                 
      

              	
                (ii)

              	
                If
      to the Company:

              


      

       

      River
Valley Bancorp

      Attention:
Matthew P. Forrester

      430
Clifty Drive

      Madison,
Indiana 47250

      Telephone:
(812) 273-4949

      


      with a
copy to (which copy alone shall not constitute notice):

      


      Barnes
& Thornburg LLP

      Attention:
Claudia V. Swhier, Esq.

      11 South
Meridian Street

      Indianapolis,
Indiana 46204

      Telephone:
(317) 231-7231

      


      6.7           Entire
Agreement; Assignment.  
 (a) This Agreement (including the Exhibits hereto) and any other
agreements executed on the date hereof by the parties hereto constitute the
entire agreement, and supersede all other prior agreements, understandings,
representations and warranties, both written and oral, between the parties, with
respect to the subject matter hereof other than the terms of any confidentiality
agreement entered into between the parties; and (b) neither party hereto may
assign this Agreement, in whole or in part, without the prior written consent of
the other party hereto, and any attempted assignment not in accordance herewith
shall be null and void and of no force or effect.

       

      6.8           Interpretation;
Other Definitions.  
 Wherever required by the context of this Agreement, the singular shall
include the plural and vice versa, and the masculine gender shall include the
feminine and neuter genders and vice versa, and references to any agreement,
document or instrument shall be deemed to refer to such agreement, document or
instrument as amended, supplemented or modified from time to time. All article,
section, paragraph or clause references not attributed to a particular document
shall be references to such parts of this Agreement, and all exhibit, annex and
schedule references not attributed to a particular document shall be references
to such exhibits, annexes and schedules to this Agreement. In addition, the
following terms are ascribed the following meanings:

       


      
        
           


        

        
          13

          
            

          

        

        
           


        

      


      (a)           the
term “Affiliate” means,
with respect to any person, any person directly or indirectly controlling,
controlled by or under common control with, such other person. For purposes of
this definition, “control”(including, with correlative meanings, the terms
“controlled
by” and “under common control with”) when used with respect to any person, means
the possession, directly or indirectly, of the power to cause the direction of
management or policies of such person, whether through the ownership of voting
securities by contract or otherwise;

       

      (b)           the
word “or” is not exclusive;

       

      (c)           the
words “including,” “includes,” “included” and “include” are deemed to be
followed by the words “without limitation”;

       

      (d)           the
terms “herein,” “hereof” and “hereunder” and other words of similar import refer
to this Agreement as a whole and not to any particular section, paragraph or
subdivision;

       

      (e)           “business day” means any day
except Saturday, Sunday and any day which shall be a legal holiday or a day on
which banking institutions in the State of Indiana generally are authorized or
required by law or other governmental action to close; and

       

      (f)           “person” has the meaning given
to it in Section 3(a)(9) of the Securities Exchange Act of 1934, as amended
(“Exchange Act”) and as
used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act.

       

      6.9           Captions.  
 The article, section, paragraph and clause captions herein are for
convenience of reference only, do not constitute part of this Agreement and will
not be deemed to limit or otherwise affect any of the provisions
hereof.

       

      6.10           Severability.  
 If any provision of this Agreement or the application thereof to any
person (including the officers and directors the parties hereto) or circumstance
is determined by a court of competent jurisdiction to be invalid, void or
unenforceable, the remaining provisions hereof, or the application of such
provision to persons or circumstances other than those as to which it has been
held invalid or unenforceable, will remain in full force and effect and shall in
no way be affected, impaired or invalidated thereby, so long as the economic or
legal substance of the transactions contemplated hereby is not affected in any
manner materially adverse to any party. Upon such determination, the parties
shall negotiate in good faith in an effort to agree upon a suitable and
equitable substitute provision to effect the original intent of the
parties.

       

      6.11           No Third
Party Beneficiaries.  
 Nothing contained in this Agreement, expressed or implied, is intended to
confer upon any person other than the parties hereto, any benefit, right or
remedy.

       

      6.12           Time of
Essence.  
 Time is of the essence in the performance of each and every term of this
Agreement.

       

      6.13           Public
Announcements.  
 Subject to each party’s disclosure obligations imposed by law or
regulation or the rules of any stock exchange upon which its securities are
listed, each of the parties hereto will cooperate with each other in the
development and distribution of all news releases and other public information
disclosures with respect to this Agreement and any of the transactions
contemplated by this Agreement.

       


      
        
           


        

        
          14

          
            

          

        

        
           


        

      


      6.14           Specific
Performance.  
 The parties agree that irreparable damage would occur in the event that
any of the provisions of this Agreement were not performed in accordance with
their specific terms. It is accordingly agreed that the parties shall be
entitled to seek specific performance of the terms hereof, this being in
addition to any other remedies to which they are entitled at law or
equity.

       

      [Signature
pages follow]

       


      
        
           


        

        
          15

          
            

          

        

        
           


        

      


      IN
WITNESS WHEREOF, this Agreement has been duly executed and delivered by the
parties hereto or duly authorized officers of the parties hereto as of the date
first herein above written.

       

      
        	 
      	
                “COMPANY”

              
	 
      	
                River
      Valley Bancorp

              
	 
      	 
      	 
      
	 
      	
                By:

              	 
      
	 
      	
                Name:

              	 
      
	 
      	
                Title:

              	 
      
	 
      	 
      
	 
      	 
      
	 
      	
                “PURCHASER”

              
	 
      	 
      	 
      
	 
      	
                Signature:

              	 
      
	 
      	
                Print
      Name:

              	 
      
	 
      	
                Address:

              	 
      
	 
      	 
      
	 
      	 
      
	 
      	
                (Individual)

              
	 
      	 
      
	 
      	 
      
	 
      	
                “PURCHASER”

              
	 
      	 
      	 
      
	 
      	
                Signature:

              	 
      
	 
      	
                Print
      Name:

              	 
      
	 
      	
                Address:

              	 
      
	 
      	 
      
	 
      	 
      
	 
      	
                (Individual)

              
	 
      	 
      
	 
      	 
      
	 
      	
                “PURCHASER”

              
	 
      	 
      
	 
      	
                Name
      of Entity:

              	 
      
	 
      	
                By:

              	 
      
	 
      	
                Print
      Name:

              	 
      
	 
      	
                Title:

              	 
      


      


      
        
           


        

        
          16

          
            

          

        

        
           


        

      


      


       

      
        	 
      	
                Address:

              	 
      
	 
      	 
      
	 
      	 
      
	 
      	
                (Entity)

              	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                “PURCHASER”

              
	 
      	 
      	 
      
	 
      	
                Name
      of IRA:

              	 
      
	 
      	
                By:

              	 
      
	 
      	
                Print
      Name:

              	 
      
	 
      	
                Address:

              	 
      
	 
      	 
      
	 
      	 
      
	 
      	
                (IRA)

              	 
      


      

      


      


      


      



      
        
           


        

        
          17

          
            

          

        

        
           


        

      

    

     

    
      Exhibit A to Investment
Agreement

       

      


       

      Certificate
of Designations

      of

      Fixed
Rate Cumulative Perpetual Preferred Stock, Series A

      of

      River
Valley Bancorp

       

      River Valley Bancorp, a
corporation organized and existing under the laws of the State of Indiana (the
“Corporation”), in
accordance with the provisions of Section 23-1-25-2 of the Indiana Business
Corporation Law, does hereby certify:

       

      The board
of directors of the Corporation (the “Board of Directors”) or an
applicable committee of the Board of Directors, in accordance with the Articles
of Incorporation and Code of By-laws of the Corporation and applicable law,
adopted the following resolution on August 18, 2009, creating a series of 8,000
shares of Preferred Stock of the Corporation designated as “Fixed Rate Cumulative Perpetual
Preferred Stock, Series A”.

       

      RESOLVED,
that pursuant to the provisions of the Articles of Incorporation and Code of
By-laws of the Corporation and applicable law, a series of Preferred Stock,
without par value, of the Corporation be and hereby is created, and that the
designation and number of shares of such series, and the voting and other
powers, preferences and relative, participating, optional or other rights, and
the qualifications, limitations and restrictions thereof, of the shares of such
series, are as follows:

       

      Section
1. Designation and
Number of Shares. There is hereby created out of the authorized and
unissued shares of preferred stock of the Corporation a series of preferred
stock designated as the “Fixed Rate Cumulative Perpetual Preferred Stock, Series
A” (the “Designated Preferred
Stock”). The authorized number of shares of Designated Preferred Stock
shall be 8,000.

       

      Section
2. General
Matters. Each share of Designated Preferred Stock shall be identical in
all respects to every other share of Designated Preferred Stock. The Designated
Preferred Stock shall be perpetual, subject to the provisions of Section 6
hereof. The Designated Preferred Stock shall rank equally with Parity Stock and
shall rank senior to Junior Stock with respect to the payment of dividends and
the distribution of assets in the event of any dissolution, liquidation or
winding up of the Corporation.

       

      Section
3. Definitions.
As used herein with respect to Designated Preferred Stock:

       

      (a)           “Applicable Dividend Rate”
means (i) during the period from the Original Issue Date to, but excluding, the
first day of the first Dividend Period commencing on or after the fifth
anniversary of the Original Issue Date, 7.25% per annum and (ii) from and after
the first day of the first Dividend Period commencing on or after the fifth
anniversary of the Original Issue Date, 9% per annum.

       

      (b)           “Business Combination” means a
merger, consolidation, statutory share exchange or similar transaction that
requires the approval of the Corporation’s shareholders.

       

      (c)           “Business Day” means any day
except Saturday, Sunday and any day on which banking institutions in the State
of Indiana generally are authorized or required by law or other governmental
actions to close.

       


      
        
           


        

        
          A-1

          
            

          

        

        
           


        

      


      (d)           “Bylaws” means the bylaws of
the Corporation, as they may be amended from time to time.

       

      (e)           “Certificate of Designations”
means the Certificate of Designations or comparable instrument relating to the
Designated Preferred Stock, as it may be amended from time to time.

       

      (f)           “Charter” means the
Corporation’s articles of incorporation or similar organizational
document.

       

      (g)           “Common Stock” means the common
stock, without par value, of the Corporation.

       

      (h)           “Dividend Payment Date” means
March 15, June 15, September 15 and December 15 of each year.

       

      (i)           “Dividend Period” has the
meaning set forth in Section 4(a).

       

      (j)           “Dividend Record Date” has the
meaning set forth in Section 4(a).

       

      (k)           “Junior Stock” means the Common
Stock and
any other class or series of stock of the Corporation the terms of which
expressly provide that it ranks junior to Designated Preferred Stock as to
dividend rights and/or as to rights on liquidation, dissolution or winding up of
the Corporation.

       

      (l)           “Liquidation Amount” means
$1,000 per share of Designated Preferred Stock.

       

      (m)           “Liquidation Preference” has
the meaning set forth in Section 5(a).

       

      (n)           “Original Issue Date” means the
date on which shares of Designated Preferred Stock are first
issued.

       

      (o)           “Parity Stock” means any class
or series of stock of the Corporation (other than Designated Preferred Stock)
the terms of which do not expressly provide that such class or series will rank
senior or junior to Designated Preferred Stock as to dividend rights and/or as
to rights on liquidation, dissolution or winding up of the Corporation (in each
case without regard to whether dividends accrue cumulatively or
non-cumulatively).

       

      (p)           “Preferred Director” has the
meaning set forth in Section 8(b).

       

      (q)           “Preferred Stock” means any and
all series of preferred stock of the Corporation, including the Designated
Preferred Stock.

       

      (r)           “Share Dilution Amount” has the
meaning set forth in Section 4(b).

       

      (s)           “Voting Parity Stock” means,
with regard to any matter as to which the holders of Designated Preferred Stock
are entitled to vote as specified in Sections 8(a) and 8(b), any and all series
of Parity Stock upon which like voting rights have been conferred and are
exercisable with respect to such matter.

       

      Section 4. Dividends.

       

      (a)           Rate. Holders of
Designated Preferred Stock shall be entitled to receive, on each share of
Designated Preferred Stock if, as and when declared by the Board of Directors or
any duly authorized committee of the Board of Directors, but only out of assets
legally available therefor, cumulative cash dividends with respect to each
Dividend Period (as defined below) at a rate per annum equal to the Applicable
Dividend Rate on

       


      
        
           


        

        
          A-2

          
            

          

        

        
           


        

      


      (i) the
Liquidation Amount per share of Designated Preferred Stock and (ii) the amount
of accrued and unpaid dividends for any prior Dividend Period on such share of
Designated Preferred Stock, if any. Such dividends shall begin to accrue and be
cumulative from the Original Issue Date, shall compound on each subsequent
Dividend Payment Date (i.e., no dividends shall
accrue on other dividends unless and until the first Dividend Payment Date for
such other dividends has passed without such other dividends having been paid on
such date) and shall be payable quarterly in arrears on each Dividend Payment
Date, commencing with the first such Dividend Payment Date to occur at least 20
calendar days after the Original Issue Date. In the event that any Dividend
Payment Date would otherwise fall on a day that is not a Business Day, the
dividend payment due on that date will be postponed to the next day that is a
Business Day and no additional dividends will accrue as a result of that
postponement. The period from and including any Dividend Payment Date to, but
excluding, the next Dividend Payment Date is a “Dividend Period,” provided
that the initial Dividend Period shall be the period from and including the
Original Issue Date to, but excluding, the next Dividend Payment
Date.

       

      Dividends
that are payable on Designated Preferred Stock in respect of any Dividend Period
shall be computed on the basis of a 360-day year consisting of twelve 30-day
months. The amount of dividends payable on Designated Preferred Stock on any
date prior to the end of a Dividend Period, and for the initial Dividend Period,
shall be computed on the basis of a 360-day year consisting of twelve 30-day
months, and actual days elapsed over a 30-day month.

       

      Dividends
that are payable on Designated Preferred Stock on any Dividend Payment Date will
be payable to holders of record of Designated Preferred Stock as they appear on
the stock register of the Corporation on the applicable record date, which shall
be the 15th calendar day immediately preceding such Dividend Payment Date or
such other record date fixed by the Board of Directors or any duly authorized
committee of the Board of Directors that is not more than 60 nor less than 10
days prior to such Dividend Payment Date (each, a “Dividend Record Date”). Any
such day that is a Dividend Record Date shall be a Dividend Record Date whether
or not such day is a Business Day.

       

      Holders
of Designated Preferred Stock shall not be entitled to any dividends, whether
payable in cash, securities or other property, other than dividends (if any)
declared and payable on Designated Preferred Stock as specified in this Section
4 (subject to the other provisions of the Certificate of
Designations).

       

      (b)           Priority of
Dividends. So long as any share of Designated Preferred Stock remains
outstanding, no dividend or distribution shall be declared or paid on the Common
Stock or any other shares of Junior Stock (other than dividends payable solely
in shares of Common Stock) or Parity Stock, subject to the immediately following
paragraph in the case of Parity Stock, and no Common Stock, Junior Stock or
Parity Stock shall be, directly or indirectly, purchased, redeemed or otherwise
acquired for consideration by the Corporation or any of its subsidiaries unless
all accrued and unpaid dividends for all past Dividend Periods, including the
latest completed Dividend Period (including, if applicable as provided in
Section 4(a) above, dividends on such amount), on all outstanding shares of
Designated Preferred Stock have been or are contemporaneously declared and paid
in full (or have been declared and a sum sufficient for the payment thereof has
been set aside for the benefit of the holders of shares of Designated Preferred
Stock on the applicable record date). The foregoing limitation shall not apply
to (i) redemptions, purchases or other acquisitions of shares of Common Stock or
other Junior

       


      
        
           


        

        
          A-3

          
            

          

        

        
           


        

      


      Stock in
connection with the administration of any employee benefit plan in the ordinary
course of business (including purchases to offset the Share Dilution Amount (as
defined below) pursuant to a publicly announced repurchase plan) and consistent
with past practice, provided that
any purchases to offset the Share Dilution Amount shall in no event exceed the
Share Dilution Amount; (ii) purchases or other acquisitions by a broker-dealer
subsidiary of the Corporation solely for the purpose of market-making,
stabilization or customer facilitation transactions in Junior Stock or Parity
Stock in the ordinary course of its business; (iii) purchases by a broker-dealer
subsidiary of the Corporation of capital stock of the Corporation for resale
pursuant to an offering by the Corporation of such capital stock underwritten by
such broker-dealer subsidiary; (iv) any dividends or distributions of rights or
Junior Stock in connection with a shareholders’ rights plan or any redemption or
repurchase of rights pursuant to any shareholders’ rights plan; (v) the
acquisition by the Corporation or any of its subsidiaries of record ownership in
Junior Stock or Parity Stock for the beneficial ownership of any other persons
(other than the Corporation or any of its subsidiaries), including as trustees
or custodians; and (vi) the exchange or conversion of Junior Stock for or into
other Junior Stock or of Parity Stock for or into other Parity Stock (with the
same or lesser aggregate liquidation amount) or Junior Stock, in each case,
solely to the extent required pursuant to binding contractual agreements entered
into prior to the Original Issue Date or any subsequent agreement for the
accelerated exercise, settlement or exchange thereof for Common Stock. “Share Dilution Amount” means
the increase in the number of diluted shares outstanding (determined in
accordance with generally accepted accounting principles in the United States,
and as measured from the date of the Corporation’s consolidated financial
statements most recently filed with the Securities and Exchange Commission prior
to the Original Issue Date) resulting from the grant, vesting or exercise of
equity-based compensation to employees and equitably adjusted for any stock
split, stock dividend, reverse stock split, reclassification or similar
transaction.

       

      When
dividends are not paid (or declared and a sum sufficient for payment thereof set
aside for the benefit of the holders thereof on the applicable record date) on
any Dividend Payment Date (or, in the case of Parity Stock having dividend
payment dates different from the Dividend Payment Dates, on a dividend payment
date falling within a Dividend Period related to such Dividend Payment Date) in
full upon Designated Preferred Stock and any shares of Parity Stock, all
dividends declared on Designated Preferred Stock and all such Parity Stock and
payable on such Dividend Payment Date (or, in the case of Parity Stock having
dividend payment dates different from the Dividend Payment Dates, on a dividend
payment date falling within the Dividend Period related to such Dividend Payment
Date) shall be declared pro rata so that the respective amounts of such
dividends declared shall bear the same ratio to each other as all accrued and
unpaid dividends per share on the shares of Designated Preferred Stock
(including, if applicable as provided in Section 4(a) above, dividends on such
amount) and all Parity Stock payable on such Dividend Payment Date (or, in the
case of Parity Stock having dividend payment dates different from the Dividend
Payment Dates, on a dividend payment date falling within the Dividend Period
related to such Dividend Payment Date) (subject to their having been declared by
the Board of Directors or a duly authorized committee of the Board of Directors
out of legally available funds and including, in the case of Parity Stock that
bears cumulative dividends, all accrued but unpaid dividends) bear to each
other. If the Board of Directors or a duly authorized committee of the Board of
Directors determines not to pay any dividend or a full

       


      
        
           


        

        
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      dividend
on a Dividend Payment Date, the Corporation will provide written notice to the
holders of Designated Preferred Stock prior to such Dividend Payment
Date.

       

      Subject
to the foregoing, and not otherwise, such dividends (payable in cash, securities
or other property) as may be determined by the Board of Directors or any duly
authorized committee of the Board of Directors may be declared and paid on any
securities, including Common Stock and other Junior Stock, from time to time out
of any funds legally available for such payment, and holders of Designated
Preferred Stock shall not be entitled to participate in any such
dividends.

       

      Section 5. Liquidation
Rights.

       

      (a)           Voluntary or Involuntary
Liquidation. In the event of any liquidation, dissolution or winding up
of the affairs of the Corporation, whether voluntary or involuntary, holders of
Designated Preferred Stock shall be entitled to receive for each share of
Designated Preferred Stock, out of the assets of the Corporation or proceeds
thereof (whether capital or surplus) available for distribution to shareholders
of the Corporation, subject to the rights of any creditors of the Corporation,
before any distribution of such assets or proceeds is made to or set aside for
the holders of Common Stock and any other stock of the Corporation ranking
junior to Designated Preferred Stock as to such distribution, payment in full in
an amount equal to the sum of (i) the Liquidation Amount per share and (ii) the
amount of any accrued and unpaid dividends (including, if applicable as provided
in Section 4(a) above, dividends on such amount), whether or not declared, to
the date of payment (such amounts collectively, the “Liquidation
Preference”).

       

      (b)           Partial Payment. If
in any distribution described in Section 4(a) above the assets of the
Corporation or proceeds thereof are not sufficient to pay in full the amounts
payable with respect to all outstanding shares of Designated Preferred Stock and
the corresponding amounts payable with respect of any other stock of the
Corporation ranking equally with Designated Preferred Stock as to such
distribution, holders of Designated Preferred Stock and the holders of such
other stock shall share ratably in any such distribution in proportion to the
full respective distributions to which they are entitled.

       

      (c)           Residual
Distributions. If the Liquidation Preference has been paid in full to all
holders of Designated Preferred Stock and the corresponding amounts payable with
respect of any other stock of the Corporation ranking equally with Designated
Preferred Stock as to such distribution has been paid in full, the holders of
other stock of the Corporation shall be entitled to receive all remaining assets
of the Corporation (or proceeds thereof) according to their respective rights
and preferences.

       

      (d)           Merger, Consolidation and
Sale of Assets Not Liquidation. For purposes of this Section 5, the
merger or consolidation of the Corporation with any other corporation or other
entity, including a merger or consolidation in which the holders of Designated
Preferred Stock receive cash, securities or other property for their shares, or
the sale, lease or exchange (for cash, securities or other property) of all or
substantially all of the assets of the Corporation, shall not constitute a
liquidation, dissolution or winding up of the Corporation.

       


      
        
           


        

        
          A-5

          
            

          

        

        
           


        

      


      Section 6. Redemption.

       

      (a)           Optional Redemption.
Except as provided below, the Designated Preferred Stock may not be redeemed
prior to the first Dividend Payment Date falling on or after the fifth
anniversary of the Original Issue Date. On or after the first Dividend Payment
Date falling on or after the fifth anniversary of the Original Issue Date, the
Corporation, at its option, may redeem, in whole or in part, at any time and
from time to time, out of funds legally available therefor, the shares of
Designated Preferred Stock at the time outstanding, upon notice given as
provided in Section 6(c) below, at a redemption price equal to the sum of (i)
the Liquidation Amount per share and (ii) except as otherwise provided below,
any accrued and unpaid dividends (including, if applicable as provided in
Section 4(a) above, dividends on such amount) (regardless of whether any
dividends are actually declared) to, but excluding, the date fixed for
redemption.

       

      The
redemption price for any shares of Designated Preferred Stock shall be payable
on the redemption date to the holder of such shares against surrender of the
certificate(s) evidencing such shares to the Corporation or its agent. Any
declared but unpaid dividends payable on a redemption date that occurs
subsequent to the Dividend Record Date for a Dividend Period shall not be paid
to the holder entitled to receive the redemption price on the redemption date,
but rather shall be paid to the holder of record of the redeemed shares on such
Dividend Record Date relating to the Dividend Payment Date as provided in
Section 4 above.

       

      (b)           No Sinking Fund. The
Designated Preferred Stock will not be subject to any mandatory redemption,
sinking fund or other similar provisions. Holders of Designated Preferred Stock
will have no right to require redemption or repurchase of any shares of
Designated Preferred Stock.

       

      (c)           Notice of Redemption.
Notice of every redemption of shares of Designated Preferred Stock shall be
given by first class mail, postage prepaid, addressed to the holders of record
of the shares to be redeemed at their respective last addresses appearing on the
books of the Corporation. Such mailing shall be at least 30 days and not more
than 60 days before the date fixed for redemption. Any notice mailed as provided
in this Subsection shall be conclusively presumed to have been duly given,
whether or not the holder receives such notice, but failure duly to give such
notice by mail, or any defect in such notice or in the mailing thereof, to any
holder of shares of Designated Preferred Stock designated for redemption shall
not affect the validity of the proceedings for the redemption of any other
shares of Designated Preferred Stock. Notwithstanding the foregoing, if shares
of Designated Preferred Stock are issued in book-entry form through The
Depository Trust Company or any other similar facility, notice of redemption may
be given to the holders of Designated Preferred Stock at such time and in any
manner permitted by such facility. Each notice of redemption given to a holder
shall state: (1) the redemption date; (2) the number of shares of Designated
Preferred Stock to be redeemed and, if less than all the shares held by such
holder are to be redeemed, the number of such shares to be redeemed from such
holder; (3) the redemption price; and (4) the place or places where certificates
for such shares are to be surrendered for payment of the redemption
price.

       

      (d)           Partial Redemption.
In case of any redemption of part of the shares of Designated Preferred Stock at
the time outstanding, the shares to be redeemed shall be selected either pro
rata or in such other manner as the Board of Directors or a duly

       


      
        
           


        

        
          A-6

          
            

          

        

        
           


        

      


      authorized
committee thereof may determine to be fair and equitable. Subject to the
provisions hereof, the Board of Directors or a duly authorized committee thereof
shall have full power and authority to prescribe the terms and conditions upon
which shares of Designated Preferred Stock shall be redeemed from time to time.
If fewer than all the shares represented by any certificate are redeemed, a new
certificate shall be issued representing the unredeemed shares without charge to
the holder thereof.

       

      (e)           Effectiveness of
Redemption. If notice of redemption has been duly given and if on or
before the redemption date specified in the notice all funds necessary for the
redemption have been deposited by the Corporation, in trust for the pro rata benefit of the
holders of the shares called for redemption, with a bank or trust company doing
business in the City of Indianapolis, Indiana, and having a capital and surplus
of at least $500 million and selected by the Board of Directors, so as to be and
continue to be available solely therefor, then, notwithstanding that any
certificate for any share so called for redemption has not been surrendered for
cancellation, on and after the redemption date dividends shall cease to accrue
on all shares so called for redemption, all shares so called for redemption
shall no longer be deemed outstanding and all rights with respect to such shares
shall forthwith on such redemption date cease and terminate, except only the
right of the holders thereof to receive the amount payable on such redemption
from such bank or trust company, without interest. Any funds unclaimed at the
end of three years from the redemption date shall, to the extent permitted by
law, be released to the Corporation, after which time the holders of the shares
so called for redemption shall look only to the Corporation for payment of the
redemption price of such shares.

       

      (f)           Status of Redeemed
Shares. Shares of Designated Preferred Stock that are redeemed,
repurchased or otherwise acquired by the Corporation shall revert to authorized
but unissued shares of Preferred Stock (provided that any such
cancelled shares of Designated Preferred Stock may be reissued only as shares of
any series of Preferred Stock other than Designated Preferred
Stock).

       

      Section 7. Conversion.   
Holders of Designated Preferred Stock shares shall have no right to exchange or
convert such shares into any other securities.

       

      Section 8. Voting
Rights.

       

      (a)           General. The holders
of Designated Preferred Stock shall not have any voting rights except as set
forth below or as otherwise from time to time required by law. To the extent the
Designated Preferred Stock has voting rights as provided in this Section 8,
holders of shares of Designated Preferred Stock will be entitled to one vote for
each such share on any matter on which holders of Designated Preferred Stock are
entitled to vote, including any action by written consent.

       

      (b)           Preferred Stock
Directors.  Whenever, at any time or times, dividends payable
on the shares of Designated Preferred Stock have not been paid for an aggregate
of six quarterly Dividend Periods or more, whether or not consecutive, the
authorized number of directors of the Corporation shall automatically be
increased by two and the holders of the Designated Preferred Stock shall have
the right, with holders of shares of any one or more other classes or series of
Voting Parity Stock outstanding at the time, voting together as a class, to
elect two directors (hereinafter the “Preferred Directors” and each
a “Preferred Director”)
to fill such newly created directorships at the Corporation’s next annual
meeting of shareholders (or at a special meeting called for that purpose prior
to such next annual meeting) and at each subsequent annual meeting
of

       


      
        
           


        

        
          A-7

          
            

          

        

        
           


        

      


      shareholders
until all accrued and unpaid dividends for all past Dividend Periods, including
the latest completed Dividend Period (including, if applicable as provided in
Section 4(a) above, dividends on such amount), on all outstanding shares of
Designated Preferred Stock have been declared and paid in full at which time
such right shall terminate with respect to the Designated Preferred Stock,
except as herein or by law expressly provided, subject to revesting in the event
of each and every subsequent default of six quarters’ duration of the character
above mentioned; provided that it shall be a qualification for election for any
Preferred Director that the election of such Preferred Director shall not cause
the Corporation to violate any corporate governance requirements of any
securities exchange or other trading facility on which securities of the
Corporation may then be listed or traded that listed or traded companies must
have a majority of independent directors. Upon any termination of the right of
the holders of shares of Designated Preferred Stock and Voting Parity Stock as a
class to vote for directors as provided above, the Preferred Directors shall
cease to be qualified as directors, the term of office of all Preferred
Directors then in office shall terminate immediately and the authorized number
of directors shall be reduced by the number of Preferred Directors elected
pursuant hereto. Any Preferred Director may be removed at any time, with or
without cause, and any vacancy created thereby may be filled, only by the
affirmative vote of the holders a majority of the shares of Designated Preferred
Stock at the time outstanding voting separately as a class together with the
holders of shares of Voting Parity Stock, to the extent the voting rights of
such holders described above are then exercisable. If the office of any
Preferred Director becomes vacant for any reason other than removal from office
as aforesaid, the remaining Preferred Director may choose a successor who shall
hold office for the unexpired term in respect of which such vacancy
occurred.

       

      (c)           Class Voting Rights as to
Particular Matters. So long as any shares of Designated Preferred Stock
are outstanding, in addition to any other vote or consent of shareholders
required by law or by the Charter, the vote or consent of the holders of at
least 66 2/3% of the shares of Designated Preferred Stock at the time
outstanding, voting as a separate class, given in person or by proxy, either in
writing without a meeting or by vote at any meeting called for the purpose,
shall be necessary for effecting or validating:

       

      (i) Authorization of Senior
Stock. Any amendment or alteration of the Certificate of Designations for
the Designated Preferred Stock or the Charter to authorize or create or increase
the authorized amount of, or any issuance of, any shares of, or any securities
convertible into or exchangeable or exercisable for shares of, any class or
series of capital stock of the Corporation ranking senior to Designated
Preferred Stock with respect to either or both the payment of dividends and/or
the distribution of assets on any liquidation, dissolution or winding up of the
Corporation;

       

      (ii)
Amendment of
Designated Preferred Stock. Any amendment, alteration or repeal of any
provision of the Certificate of Designations for the Designated Preferred Stock
or the Charter (including, unless no vote on such merger or consolidation is
required by Section 8(c)(iii) below, any amendment, alteration or repeal by
means of a merger, consolidation or otherwise) so as to adversely affect the
rights, preferences, privileges or voting powers of the Designated Preferred
Stock; or

       


      
        
           


        

        
          A-8

          
            

          

        

        
           


        

      


      (iii)
Share Exchanges,
Reclassifications, Mergers and Consolidations. Any consummation of a
binding share exchange or reclassification involving the Designated Preferred
Stock, or of a merger or consolidation of the Corporation with another
corporation or other entity, unless in each case (x) the shares of Designated
Preferred Stock remain outstanding or, in the case of any such merger or
consolidation with respect to which the Corporation is not the surviving or
resulting entity, are converted into or exchanged for preference securities of
the surviving or resulting entity or its ultimate parent, and (y) such shares
remaining outstanding or such preference securities, as the case may be, have
such rights, preferences, privileges and voting powers, and limitations and
restrictions thereof, taken as a whole, as are not materially less favorable to
the holders thereof than the rights, preferences, privileges and voting powers,
and limitations and restrictions thereof, of Designated Preferred Stock
immediately prior to such consummation, taken as a whole;

       

      provided, however, that for
all purposes of this Section 8(c), any increase in the amount of the authorized
Preferred Stock, including any increase in the authorized amount of Designated
Preferred Stock necessary to satisfy preemptive or similar rights granted by the
Corporation to other persons prior to the Original Issue Date, or the creation
and issuance, or an increase in the authorized or issued amount, whether
pursuant to preemptive or similar rights or otherwise, of any other series of
Preferred Stock, or any securities convertible into or exchangeable or
exercisable for any other series of Preferred Stock, ranking equally with and/or
junior to Designated Preferred Stock with respect to the payment of dividends
(whether such dividends are cumulative or non-cumulative) and the distribution
of assets upon liquidation, dissolution or winding up of the Corporation will
not be deemed to adversely affect the rights, preferences, privileges or voting
powers, and shall not require the affirmative vote or consent of, the holders of
outstanding shares of the Designated Preferred Stock.

       

      (d)           Changes after Provision for
Redemption. No vote or consent of the holders of Designated Preferred
Stock shall be required pursuant to Section 8(c) above if, at or prior to the
time when any such vote or consent would otherwise be required pursuant to such
Section, all outstanding shares of the Designated Preferred Stock shall have
been redeemed, or shall have been called for redemption upon proper notice and
sufficient funds shall have been deposited in trust for such redemption, in each
case pursuant to Section 6 above.

       

      (e)           Procedures for Voting and
Consents. The rules and procedures for calling and conducting any meeting
of the holders of Designated Preferred Stock (including, without limitation, the
fixing of a record date in connection therewith), the solicitation and use of
proxies at such a meeting, the obtaining of written consents and any other
aspect or matter with regard to such a meeting or such consents shall be
governed by any rules that the Board of Directors or any duly authorized
committee of the Board of Directors, in its discretion, may adopt from time to
time, which rules and procedures shall conform to the requirements of the
Charter, the Bylaws, and applicable law and the rules of any national securities
exchange or other trading facility on which Designated Preferred Stock is listed
or traded at the time.

       

      Section 9. Record
Holders.   
To the fullest extent permitted by applicable law, the Corporation and the
transfer agent for Designated Preferred Stock may deem and treat the record
holder of any share of Designated Preferred Stock as the true and lawful owner
thereof for all

       


      
        
           


        

        
          A-9

          
            

          

        

        
           


        

      


      purposes,
and neither the Corporation nor such transfer agent shall be affected by any
notice to the contrary.

       

      Section 10. Notices.   
All notices or communications in respect of Designated Preferred Stock shall be
sufficiently given if given in writing and delivered in person or by first class
mail, postage prepaid, or if given in such other manner as may be permitted in
this Certificate of Designations, in the Charter or Bylaws or by applicable law.
Notwithstanding the foregoing, if shares of Designated Preferred Stock are
issued in book-entry form through The Depository Trust Company or any similar
facility, such notices may be given to the holders of Designated Preferred Stock
in any manner permitted by such facility.

       

      Section 11. No Preemptive
Rights.   
No share of Designated Preferred Stock shall have any rights of preemption
whatsoever as to any securities of the Corporation, or any warrants, rights or
options issued or granted with respect thereto, regardless of how such
securities, or such warrants, rights or options, may be designated, issued or
granted.

       

      Section 12. Replacement
Certificates.   
The Corporation shall replace any mutilated certificate at the holder’s expense
upon surrender of that certificate to the Corporation. The Corporation shall
replace certificates that become destroyed, stolen or lost at the holder’s
expense upon delivery to the Corporation of reasonably satisfactory evidence
that the certificate has been destroyed, stolen or lost, together with any
indemnity that may be reasonably required by the Corporation.

       

      Section 13. Other
Rights.   
The shares of Designated Preferred Stock shall not have any rights, preferences,
privileges or voting powers or relative, participating, optional or other
special rights, or qualifications, limitations or restrictions thereof, other
than as set forth herein or in the Charter or as provided by applicable
law.

       

      IN
WITNESS WHEREOF, River Valley Bancorp has caused this Certificate of
Designations to be signed by Matthew P. Forrester, its President and Chief
Executive Officer, this ____ day of ______________, 2009.

       

      
 

      
        
          	 
      	
                  River
      Valley Bancorp

                
	 
      	 
      	 
      
	 
      	
                  By:

                	 
      
	 
      	 
      	 
      
	 
      	
                  Name:
      Matthew P. Forrester

                
	 
      	 
      	 
      
	 
      	
                  Title:   President
      and Chief Executive
Officer

                


        

      

    

     

     

     

    
      
        
        

      

      
        A-10

        
          

        

      

      
        
        

      

    

     

    
      Exhibit B to Investment
Agreement

       

       

      Escrow
Agreement

       

      Agreement made this
_____ day of __________, 2009, by and between River Valley Bancorp,
an Indiana corporation (the “Issuer”), and River Valley Financial
Bank, a federal savings association based in Madison, Indiana, as escrow
agent (the “Escrow
Agent”), whose addresses appear on the Information Sheet (Appendix A)
attached to this Agreement.

       

      WHEREAS,
the Issuer proposes to offer the Securities as defined in the Information Sheet
(Appendix A) for sale to investors on the terms as set forth on the Information
Sheet; and

       

      WHEREAS,
the Issuer desires to establish an escrow account (the “Escrow Account”), to which
subscription monies which are received by the Escrow Agent from the Issuer in
connection with such offering are to be credited, and the Escrow Agent is
willing to establish the Escrow Account on the terms and subject to the
conditions hereinafter set forth.

       

      NOW,
THEREFORE, in consideration of the promises and mutual covenants herein
contained, the parties hereto hereby agree as follows:

       

      1.           Information
Sheet.  Each capitalized term not otherwise defined in this
agreement shall have the meaning set forth for such term on the information
sheet which is attached to this agreement and is incorporated by reference
herein and made a part hereof (the “Information
Sheet”).

       

      2.           Establishment of the Escrow
Account.

       

      2.1           The
Issuer has established an interest bearing trust account (the “Escrow Account”) with the
Escrow Agent, account number __________.  The purpose of the Escrow
Account is for the deposit of all subscription monies (checks or wire transfers)
which are received by the Issuer from the prospective purchasers of the
Securities and are delivered by the Issuer to the Escrow Agent, for the holding
of amounts of subscription monies which are collected through the banking
system, and the distribution of collected funds and interest accrued thereon,
all as described herein.

       

      2.2           The
Offering Period, which shall be deemed to commence on August ___, 2009, shall
consist of the number of days set forth on the Information Sheet.  The
last day of the Offering Period is referred to herein as the “Termination
Date.”

       

      2.3           This
Agreement shall terminate upon the sooner to occur of the date on which (i) the
Escrow Agent disburses the full balance, including principal and interest,
credited to the Escrow Account to the Issuer pursuant to Section 4.2 hereof (the
“Closing Date”), (ii)
the Escrow Agent disburses the funds in the Escrow Account pursuant to Section
3.5 hereof, or (iii) the Escrow Agent returns to each subscriber following the
Termination Date all amounts payable by the Escrow Agent under Section 4.3
hereof. Upon the termination of this Agreement, the Issuer shall not deposit,
and the Escrow Agent shall not accept, any additional amounts representing
payments by prospective purchasers.

       


      
        
           


        

        
          B-1

          
            

          

        

        
           


        

      


      3.           Deposits to the Escrow
Account.

       

      3.1           The
Issuer shall promptly deliver to the Escrow Agent all monies which it receives
from prospective purchasers of the Securities, which monies shall be in the form
of checks or wire transfers.  Upon the Escrow Agent’s receipt of such
monies, they shall be credited to the Escrow Account.  All checks
delivered to the Escrow Agent shall be payable to “River Valley Financial Bank,
as Escrow Agent for River Valley Bancorp.”  Any check payable other
than as required hereby shall be returned to the prospective purchaser, or if
the Escrow Agent has insufficient information to do so, then to the Issuer by
noon of the next business day following receipt of such check by the Escrow
Agent, and such check shall be deemed not to have been delivered to the Escrow
Agent pursuant to the terms of this Agreement.

       

      3.2           Promptly
after receiving subscription monies as described in Section 3.1, the Escrow
Agent shall deposit the same into the Escrow Account.  Amounts of
monies so deposited are hereinafter referred to as “Escrow
Amounts.”  The Escrow Agent shall process all Escrow Amounts
for collection.  Simultaneously with each deposit to the Escrow
Account, the Issuer shall inform the Escrow Agent in writing of the name and
address of the prospective purchaser and the aggregate dollar amount of the
Securities subscribed for by such purchaser (collectively, the “Subscription Information”) and
shall deposit a copy of the purchaser’s Investment Agreement with the Escrow
Agent.

       

      3.3           The
Escrow Agent shall not be required to accept in the Escrow Account any amounts
representing payments by prospective purchasers, whether by check or wire,
except during the Escrow Agent’s regular business hours.

       

      3.4           Only
those Escrow Amounts, which have been deposited in the Escrow Account and which
have been cleared and have been collected by the Escrow Agent, are herein
referred to as the “Fund.”  The Escrow
Agent bears no responsibility for checks returned for insufficient funds and is
not to expend its own money to make the Fund whole.

       

      3.5           If
the proposed offering is terminated before the Termination Date and before a
Closing Date has occurred, the Escrow Agent shall disburse the Fund and interest
accrued thereon upon instructions in writing signed by the Issuer.

       

      4.           Disbursement from the Escrow
Account.

       

      4.1           Promptly
upon deposit of Escrow Amounts into the Escrow Account, the Escrow Agent shall
notify the Issuer of such deposit activity in writing, by email or facsimile
transmission.  The Escrow Agent shall invest and hold the proceeds as
provided in this Agreement until it receives written notification from the
Issuer that the offering for the Securities has closed.  The offering
shall close no later than the Termination Date.

       

      4.2           In
the event that purchasers subscribe to a minimum of 5,000 Securities and the
Minimum Amount is deposited with the Escrow Agent, the Issuer shall notify the
Escrow Agent of the Closing Date, and on such date, upon the written
authorization of the Issuer, the Escrow Agent shall promptly pay to the Issuer
the full balance, including principal and interest, credited to the Escrow
Account as of such date.

       


      
        
           


        

        
          B-2

          
            

          

        

        
           


        

      


      4.3           In
the event that subscriptions are not accepted for a minimum of 5,000 Securities
or the Minimum Amount is not on deposit with the Escrow Agent by the Termination
Date, the offering will be terminated.  The Issuer shall immediately
notify the Escrow Agent in writing of such termination and the Escrow Agent
shall promptly thereafter return to each subscriber, as a complete distribution,
such subscriber’s subscription amount, together with his pro-rata share of all
interest earned on the Fund.  Such subscriber’s pro-rata share of
interest earned on the Fund shall be calculated from the date of receipt of
cleared funds to the Termination Date or such earlier date of closing as the
case may be (based upon an average daily rate of return computed from all
interest earned on all proceeds held in escrow for the entire
period).

       

      4.4           In
the event that a subscriber’s subscription is not accepted, or if after a
subscription is accepted, it is later determined that it must be returned, the
Issuer shall immediately notify the Escrow Agent of this fact and the Escrow
Agent shall promptly thereafter return to the subscriber, as a complete
distribution, his subscription amount plus his pro-rata share of all interest
earned on such amount.

       

      4.5           In
no event shall the Escrow Agent be required to take any action under this
paragraph until it shall have received proper written notification from the
Issuer.

       

      5.           Rights, Duties and
Responsibilities of Escrow Agent.  It is understood and agreed
that the duties of the Escrow Agent are purely ministerial in nature and
that:

       

      5.1           The
Escrow Agent shall notify the Issuer of the Escrow Amounts which have been
deposited in the Escrow Account and of the amounts, constituting the Fund, which
have cleared the banking system and have been collected by the Escrow
Agent.

       

      5.2           The
Escrow Agent shall not be responsible for or be required to enforce any of the
terms or conditions of any agreement entered into between the Issuer and any
other party in connection with the offering of Securities.

       

      5.3           The
Escrow Agent shall not be required to accept from the Issuer any Subscription
Information pertaining to prospective purchasers unless such Subscription
Information is accompanied by checks or wire transfers meeting the requirements
of Section 3.1; however, the Escrow Agent shall notify the Issuer within a
reasonable time of any discrepancy between the amount set forth in any
Subscription Information or Investment Agreement and the amount delivered to the
Escrow Agent therewith.  Such amount need not be accepted for deposit
in the Escrow Account until such discrepancy has been resolved.

       

      5.4           The
Escrow Agent shall be under no duty or responsibility to enforce collection of
any check delivered to it hereunder.  The Escrow Agent, within a
reasonable time, shall return to the Issuer any check received which is
dishonored, together with the Subscription Information, and the Investment
Agreement if any, which accompanied such check.

       

      5.5           The
Escrow Agent shall be entitled to rely upon the accuracy, shall be protected in
acting in reliance upon the contents, and assume the genuineness of any notice,
instruction, certificate, signature, instrument or other document which is given
to the Escrow Agent pursuant to this Agreement without the necessity of the
Escrow Agent verifying the truth

       


      
        
           


        

        
          B-3

          
            

          

        

        
           


        

      


      or
accuracy thereof.  The Escrow Agent shall not be obligated to make any
inquiry as to the authority, capacity, existence or identity of any such person
purporting to give any such notice or instructions or to execute any such
certificate, instrument or other document.

       

      5.6           If
the Escrow Agent is uncertain as to its duties or rights hereunder or shall
receive instructions with respect to the Escrow Account, the Escrow Agent or the
Fund, which in its sole determination, are in conflict either with other
instructions received by it or with any provisions of this Agreement, it shall
be entitled to hold the Escrow Amounts, the Fund or a portion thereof, in the
Escrow Account pending the resolution of such  uncertainty to the
Escrow Agent’s sole satisfaction, by final judgment of a court or courts of
competent jurisdiction or otherwise; or the Escrow Agent, at its sole option,
may deposit the Fund (and any other Escrow Amounts that thereafter become part
of the Fund) with the Clerk of a court of competent jurisdiction in a proceeding
to which all parties in interest are joined.  By holding the Escrow
Amounts, the Fund or any portion thereof, the Escrow Agent shall not become
liable to the undersigned or to any other person, due to its failure to comply
with any adverse claim, demand or instruction.  Upon the deposit by
the Escrow Agent of the Fund and Interest earned thereon with the Clerk of any
court, the Escrow Agent shall be relieved of all further obligations and
released from all liability hereunder.

       

      The
Escrow Agent’s duties and responsibilities shall be determined solely by the
express provisions of this Agreement.  In no event shall the Escrow
Agent be required to notify or obtain the consent, approval, authorization or
order of any court or governmental body pursuant to the transactions
contemplated by the provisions of this Agreement.

       

      In no
event will the Escrow Agent be required to release any funds which constitute
the proceeds of a check deposited in escrow until at least five business days
have elapsed from the date of the deposit.

       

      None of
the provisions contained in this Agreement shall require the Escrow Agent to use
or advance its own funds in the performance of any of its duties or the exercise
of any of its rights or powers hereunder.

       

      In no
event shall the Escrow Agent be liable for special, indirect or consequential
loss or damage of any kind whatsoever (including but not limited to lost
profits), even if the Escrow Agent has been advised of the likelihood of such
loss or damage and regardless of the form of action.

       

      The
Escrow Agent may execute any of its trusts or powers and perform any of its
duties under this Agreement by or through attorneys, agents or
employees.

       

      The
Escrow Agent may at any time resign and be discharged from its duties and
obligations hereunder by giving notice to the Issuer of such resignation
specifying when such resignation shall take effect.  The Issuer shall
promptly appoint a successor Escrow Agent by the resignation date.  If
the Issuer does not appoint a successor by the resignation date, the resigning
Escrow Agent may petition any court of competent jurisdiction for the
appointment of a successor Escrow Agent, which court may thereupon, appoint a
successor Escrow Agent.  The Escrow Agent shall have the right to
withhold an amount equal to the amount due and owing to

       


      
        
           


        

        
          B-4

          
            

          

        

        
           


        

      


      the
Escrow Agent, plus any costs and expenses the Escrow Agent shall reasonably
believe may be incurred by the Escrow Agent in connection with the termination
of the Escrow Agreement.

       

      Any
corporation, association or other entity into which the Escrow Agent may be
converted or merged, or with which it may be consolidated, or to which it may
sell or otherwise transfer all or substantially all of its corporate trust
assets and business or any corporation, association or other entity resulting
from any such conversion, sale, merger, consolidation or other transfer to which
it is a party, ipso facto, shall be and become successor Escrow Agent hereunder,
vested with all other matters as was its predecessor, without the execution or
filing of any instrument or any further act on the part of the parties hereto,
notwithstanding anything herein to the contrary.

       

      5.7           The
Escrow Agent shall not be liable for any action taken or omitted hereunder, or
for the misconduct of any employee or agent appointed by it, except in the case
of willful misconduct or gross negligence.  The Escrow Agent shall be
entitled to consult with counsel of its own choosing and shall not be liable for
any action taken, suffered or omitted by it in accordance with the advice of
such counsel.

       

      6.           Amendment.  This
Agreement may be altered or amended only with the written consent of the Issuer
and the Escrow Agent.

       

      7.           Representations and
Warranties.  The Issuer hereby represents and warrants to the
Escrow Agent that:

       

      7.1           No
party other than the parties hereto and the prospective purchasers have, or
shall have, any lien, claim or security interest in the Escrow Amounts or the
Fund or any part thereof.

       

      7.2           The
Questionnaire and Investment Agreement submitted with each deposit shall, at the
time of submission and at the time of the disbursement of the Fund, be deemed a
representation and warranty that such deposit represents a bona fide payment by
the purchaser described therein for the amount of Securities subscribed
for.

       

      7.3           All
of the information contained in the Information Sheet is, as of the date hereof,
and will be, at the time of any disbursement of the Fund, true and
correct.

       

      7.4           It
has solicited, and continues to solicit the advice of its counsel regarding
compliance with all applicable state and federal securities laws in connection
with the offer and the sale of the Securities and that they will act in
accordance with such advice.  The Escrow Agent shall have no
responsibility to ensure compliance with securities laws and such responsibility
rests solely with the Issuer.  The Escrow Agent makes no
representations and has no responsibilities as to the validity, value or
genuineness of the offering or the Securities.

       

      8.           Fees and
Expenses.  The Escrow Agent shall be entitled to fees as set
forth on Appendix B.  In addition, the Issuer agrees to reimburse the
Escrow Agent for any reasonable expenses incurred in connection with this
Agreement, including, but not limited to, reasonable counsel
fees.  Upon receipt of the Minimum Amount, the Escrow Agent shall have
a lien upon the Fund to the extent of its fees and expenses for services as
Escrow Agent.

       


      
        
           


        

        
          B-5

          
            

          

        

        
           


        

      


      9.           Indemnification and
Contribution.

       

      9.1           The
Issuer agrees to indemnify the Escrow Agent and its officers, directors,
employees, agents and shareholders (collectively referred to as the “Indemnitees”) against, and
hold them harmless of and from, any and all loss, liability, cost, damage,
penalty, fine and expense, including without limitation, reasonable counsel
fees, which the Indemnitees may suffer or incur by reason of any action, claim
or proceeding brought against the Indemnitees arising out of or relating in any
way to this Agreement or any transaction to which this Agreement relates, unless
such action, claim or proceeding is the result of the willful misconduct or
gross negligence of the Indemnitees.  In addition to and not in
limitation of the immediately preceding sentence, the Issuer also agrees to
indemnify and hold Indemnitees harmless from and against any and all Losses that
may be imposed on, incurred by, or asserted against, the Indemnitees or any of
them for following any instructions or other directions upon which the Escrow
Agent is authorized to rely pursuant to the terms of this
Agreement.

       

      9.2           If
the indemnification provided for in Section 9.1 is applicable, but for any
reason is held to be unavailable, the Issuer shall contribute such amounts as
are just and equitable to pay, or to reimburse the Indemnitees for, the
aggregate of any and all losses, liabilities, costs, damages, penalties, fines
and expenses, including counsel fees, amount paid in settlement of, any action,
claim or proceeding arising out of or relating in any way to any actions or
omissions of the Issuer.

       

      9.3           The
provisions of this Article 9 shall survive any termination of this Agreement,
whether by disbursement of the Fund or otherwise.

       

      10.           Governing Law and
Assignment.  This Agreement shall be construed in accordance
with and governed by the laws of the State of Indiana and shall be binding upon
the parties hereto and their respective successors and assignments; provided,
however, that any assignment or transfer by any party of its rights under this
Agreement or with respect to the Escrow Amounts or the Fund shall be void as
against the Escrow Agent unless (a) written notice thereof shall be given to the
Escrow Agent; and (b) the Escrow Agent shall have the consented writing to such
assignment or transfer.

       

      11.           Notices.  All
notices required to be given in connection with this Agreement shall be sent by
registered or certified mail, return receipt requested, or by hand delivery with
receipt acknowledged, or by the Express Mail service offered by the United
States Post Office or overnight courier and addressed at their respective
addresses set forth on the Information Sheet; provided, however, that all
information required to disburse funds may be delivered by email or facsimile
transmission, followed up with hard copy original.  Faxed or pdf
copies of signatures will be considered as valid originals.

       

      12.           Severability.  If
any provision of this Agreement or the application thereof to any person or
circumstance shall be determined to be invalid or unenforceable, the remainder
hereof and the application of said provision to any other circumstances or
situation shall not be affected thereby and shall be valid and enforceable to
the fullest extent permitted by law.

       


      
        
           


        

        
          B-6

          
            

          

        

        
           


        

      


      13.           Execution in Several
Counterparts.  This Agreement may be executed in several
counterparts or by separate instruments, and all such counterparts and
instruments shall constitute one agreement, binding on all of the parties
hereto.

       

      14.           Entire
Agreement.  This Agreement constitutes the entire agreement
between the parties hereto with respect to the subject matter hereof and
supersedes all prior agreements and understandings (written or oral) of the
parties in connection therewith.

       

      (Signatures
on following page)

       


      
        
           


        

        
          B-7

          
            

          

        

        
           


        

      


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

       

      
        	 
      	 
      	 
      	
                River
      Valley Bancorp

              
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	
                By:

              	 
      
	 
      	 
      	 
      	 
      	
                Matthew
      P. Forrester, President and CEO

              
	
                River
      Valley Financial Bank, by its signature hereon, accepts the escrow agency
      created by this Agreement, and will carry out its duties as Escrow
      Agent pursuant to the terms and conditions contained in this
      Agreement.

              	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	
                River Valley Financial
      Bank, as Escrow Agent

              	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      
	
                By:

              	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      


      

      


      


      



      
        
           


        

        
          B-8

          
            

          

        

        
           


        

      


      APPENDIX
A

      ESCROW
AGREEMENT INFORMATION SHEET

      


      


      
        	
                1.

              	
                The
      Issuer

              
	 
      	 
      	 
      
	 
      	
                Name:

              	
                River
      Valley Bancorp

              
	 
      	 
      	
                430
      Clifty Drive

              
	 
      	 
      	
                Madison,
      IN  47250

              
	 
      	 
      	
                Attention:
      Matthew P. Forrester

              
	 
      	 
      	
                Fax:
      (812) 273-4944

              
	 
      	 
      	 
      
	
                2.

              	
                The
      Escrow Agent

              
	 
      	 
      	 
      
	 
      	
                Name:

              	
                River
      Valley Financial Bank

              
	 
      	
                Address:

              	
                430
      Clifty Drive

              
	 
      	 
      	
                Madison,
      IN  47250

              
	 
      	 
      	
                Attention:
      Matthew P. Forrester

              
	 
      	 
      	
                Fax:
      (812) 273-4944

              


      

      


      3.           The
Securities

      


      The
Securities: Fixed Rate Cumulative Perpetual Preferred Stock, Series A, without
par value and with a liquidation preference of $1,000 per share.

      


      4.           Terms

      


      $5,000,000
(the “Minimum Amount”)
required for disbursement of the Escrow Account.

      


      Maximum
Amount of Offering:  $8,000,000.

      


      6.           Plan
of Distribution of the Securities

      


      
        	
                 
      

              	
                Offering
      Period:

              	
                From
      the Effective Date until the earlier of the date subscriptions for 8,000
      Securities are received or September 30, 2009, unless extended by the
      Issuer, following written notice to the Escrow Agent, to a date no later
      than December 31, 2009.

              


      


      
        
           


        

        
          B-9

          
            

          

        

        
           


        

      


      APPENDIX
B

      


      SCHEDULE
OF FEES FOR SERVICES AS ESCROW AGENT

      FOR RIVER
VALLEY BANCORP PREFERRED STOCK OFFERING

      


      Escrow
Agent Administrative Fee

      


      Flat fee
of $_____, plus $___ per Investment Agreement processed by Escrow
Agent

      


      


      


       

       

       

       

       

       

       

      
B-10