EX-10.3



 Exhibit 10.3 

FIRST AMENDMENT TO THE 

BANK OF THE JAMES 
 SALARY
CONTINUATION AGREEMENT 
 THIS AMENDMENT (the “Amendment”) is adopted October 1st, 2016, by and between Bank of the James (the “Bank”), and Harry P. Umberger (the “Executive”). 

The Bank and the Executive executed a Salary Continuation Agreement August 6, 2009 (the “Agreement”), which provides deferred
compensation benefits to the Executive under certain circumstances. The Bank and the Executive now wish to amend the Agreement to freeze the benefits provided pursuant to the Agreement. The parties agree and acknowledge that this Amendment
(i) shall be interpreted in accordance with Internal Revenue Code Section 409A and (ii) freezes the amount of benefits provided under the Agreement, but does not change the payment schedule thereunder. 

NOW, THEREFORE, the Bank and the Executive adopt the following amendments to the Agreement: 

Section 1.1 of the Agreement shall be deleted in its entirety and replaced with the following. 

 

	 	1.1	“Accrued Benefit” means the dollar value of the liability that should be accrued by the Company, under Generally Accepted Accounting Principles, for the Company’s obligation to the Executive under
this Agreement, calculated by applying Accounting Standards Codification 710-10 and the Discount Rate. The Accrued Benefit as of the date of this Amendment is $188,340.22. Interest shall be credited monthly on the unpaid portion of the Accrued
Benefit at an annual rate equal to 6% until benefits under this Agreement are fully paid. 


Section 1.14 of the Agreement shall be deleted in its entirety. 

Section 2.1.1 of the Agreement shall be deleted in its entirety and replaced with the following. 

 

	 	2.1.1	Amount of Benefit. The annual benefit under this Section 2.1 is Forty-Four Thousand Eighty-Five Dollars ($44,085). 


Section 2.2.1 of the Agreement shall be deleted in its entirety and replaced with the following. 

 

	 	2.2.1	Amount of Benefit. The annual benefit under this Section 2.2 is the amount necessary to fully amortize the Accrued Benefit over the period described in Section 2.2.2, crediting interest monthly on the
unpaid portion of the Accrued Benefit at an annual rate equal to 6%. 








 Section 2.3.1 of the Agreement shall be deleted in its entirety and
replaced with the following. 
  

	 	2.3.1	Amount of Benefit. The annual benefit under this Section 2.3 is the amount necessary to fully amortize the Accrued Benefit over the period described in Section 2.3.2, crediting interest monthly on the
unpaid portion of Accrued Benefit at an annual rate equal to 6%. 

 Section 2.4.1 of the Agreement shall
be deleted in its entirety and replaced with the following. 
  

	 	2.4.1	Amount of Benefit. The annual benefit under this Section 2.4 is the amount necessary to fully amortize the Accrued Benefit over the period described in Section 2.4.2, crediting interest monthly on the
unpaid portion of Accrued Benefit at an annual rate equal to 6%. 

 Section 3.1.1 of the Agreement shall
be deleted in its entirety and replaced with the following. 
  

	 	3.1.1	Amount of Benefit. The annual benefit under this Section 2.1 is Forty-Four Thousand Eighty-Five Dollars ($44,085). 


The following Section 2.8 shall be inserted in to the Agreement immediately following Section 2.7: 

2.8 Excise Tax Limitation. Notwithstanding any provision of this Agreement to the contrary, if any benefit payment hereunder would be
treated as an “excess parachute payment” under Code Section 280G, the Bank shall reduce such benefit payment to the extent necessary to avoid treating such benefit payment as an excess parachute payment. The Executive shall be
entitled to only the reduced benefit and shall forfeit any amount over and above the reduced amount. 
 Section 8.3 of
the Agreement shall be deleted in its entirety and replaced with the following 
  

	8.3	Plan Terminations Under Code Section 409A. Notwithstanding anything to the contrary in Section 8.2, if the Bank terminates this Agreement in the following circumstances: 


 

	 	(a)	Within thirty (30) days before or twelve (12) months after a Change in Control, provided that all distributions are made no later than twelve (12) months following the termination of this Agreement and
further provided that all the Bank’s arrangements which are substantially similar to this Agreement are terminated so the Executive and all participants in the similar arrangements are required to receive all amounts of compensation deferred
under the terminated arrangements within twelve (12) months of such termination; 









	 	(b)	Upon the Bank’s dissolution or with the approval of a bankruptcy court provided that the amounts deferred under this Agreement are included in the Executive’s gross income in the latest of (i) the
calendar year in which this Agreement terminates; (ii) the calendar year in which the amount is no longer subject to a substantial risk of forfeiture; or (iii) the first calendar year in which the distribution is administratively
practical; or 

  

	 	(c)	Upon the Bank’s termination of this and all other arrangements that would be aggregated with this Agreement pursuant to Treasury Regulations Section 1.409A-1(c) if the Executive participated in such
arrangements (“Similar Arrangements”), provided that (i) the termination and liquidation does not occur proximate to a downturn in the financial health of the Bank, (ii) all termination distributions are made no earlier than
twelve (12) months and no later than twenty-four (24) months following such termination, and (iii) the Bank does not adopt any new arrangement that would be a Similar Arrangement for a minimum of three (3) years following the
date the Bank takes all necessary action to irrevocably terminate and liquidate the Agreement; 

 the Bank may distribute the
Accrued Benefit, determined as of the date of the termination of this Agreement, to the Executive subject to the above terms. 
 The
Schedule A originally attached to the Agreement shall be deleted in its entirety. 
 IN WITNESS WHEREOF, the Executive and a duly
authorized representative of the Bank have executed this Amendment as indicated below: 
  

					
	Executive	  	Bank
			
	



	  	By:	  	




		  	Its:	  	President & CEO








 Salary Continuation Agreement - Frozen Plan 

Projected Benefits (Not Part of Agreement) 

Harry P. Umberger 
  

																					
	 Birth Date: xx/xx/1965

Plan Anniversary Date: Dec. 31
 Normal
Retirement Date:
 10/25/2030, Age 65

Normal Retirement Payment:

Monthly for 15 Years
	 	  	Early Termination
Amount Payable Monthly
for 15 Years at Separation
of Service	 	  	Disability
Amount Payable Monthly
for 15 Years at Normal
Retirement Age	 	  	Change in Control
Amount Payable Monthly
for 15 Years at Separation
of Service	 	  	Death
Amount Payable Monthly
for 15 Years Upon Death	 
	 Values As Of
	  	Age	 	  	Annual Benefit 1	 	  	Annual Benefit 1	 	  	Annual Benefit 1	 	  	Annual Benefit 1	 
	 10/1/2016
	  	 	50	  	  	 	18,977	  	  	 	44,085	  	  	 	18,977	  	  	 	44,085	  
	 12/31/2016
	  	 	51	  	  	 	19,263	  	  	 	44,085	  	  	 	19,263	  	  	 	44,085	  
	 12/31/2017
	  	 	52	  	  	 	20,451	  	  	 	44,085	  	  	 	20,451	  	  	 	44,085	  
	 12/31/2018
	  	 	53	  	  	 	21,713	  	  	 	44,085	  	  	 	21,713	  	  	 	44,085	  
	 12/31/2019
	  	 	54	  	  	 	23,052	  	  	 	44,085	  	  	 	23,052	  	  	 	44,085	  
	 12/31/2020
	  	 	55	  	  	 	24,474	  	  	 	44,085	  	  	 	24,474	  	  	 	44,085	  
	 12/31/2021
	  	 	56	  	  	 	25,983	  	  	 	44,085	  	  	 	25,983	  	  	 	44,085	  
	 12/31/2022
	  	 	57	  	  	 	27,586	  	  	 	44,085	  	  	 	27,586	  	  	 	44,085	  
	 12/31/2023
	  	 	58	  	  	 	29,287	  	  	 	44,085	  	  	 	29,287	  	  	 	44,085	  
	 12/31/2024
	  	 	59	  	  	 	31,093	  	  	 	44,085	  	  	 	31,093	  	  	 	44,085	  
	 12/31/2025
	  	 	60	  	  	 	33,011	  	  	 	44,085	  	  	 	33,011	  	  	 	44,085	  
	 12/31/2026
	  	 	61	  	  	 	35,047	  	  	 	44,085	  	  	 	35,047	  	  	 	44,085	  
	 12/31/2027
	  	 	62	  	  	 	37,209	  	  	 	44,085	  	  	 	37,209	  	  	 	44,085	  
	 12/31/2028
	  	 	63	  	  	 	39,504	  	  	 	44,085	  	  	 	39,504	  	  	 	44,085	  
	 12/31/2029
	  	 	64	  	  	 	41,940	  	  	 	44,085	  	  	 	41,940	  	  	 	44,085	  
	 10/25/2030
	  	 	65	  	  	 	44,085	  	  	 	44,085	  	  	 	44,085	  	  	 	44,085	  

 The first line represents the plan values as of October 1, 2016. 

 

	1 	The annual benefit amount will be distributed in 12 equal monthly payments for a total of 180 monthly payments. 








 Salary Continuation Agreement - Frozen Plan 

Projected Benefits (Not Part of Agreement) 

IF THERE IS A CONFLICT BETWEEN THIS SCHEDULE AND THE AGREEMENT, THE TERMS AND PROVISIONS OF THE AGREEMENT SHALL PREVAIL. IF A TRIGGERING EVENT OCCURS, REFER
TO THE AGREEMENT TO DETERMINE THE ACTUAL BENEFIT AMOUNT BASED ON THE DATE OF THE EVENT. 
  

									
	Harry P. Umberger	  	



	  		  	By	  	




	Date 10-18-16	  		  		  	Title	  	President & CEO
		  		  		  	Date	  	October 18, 2016