Document:

Employment Agreement

 Exhibit 10.2 
 AMENDED AND RESTATED 
 EMPLOYMENT AGREEMENT 
 THIS EMPLOYMENT AGREEMENT is made and entered into as of the twenty-seventh day of January, 2004, and hereby amended and restated as of the first day of
June, 2007, by and between FIRST NATIONAL CORPORATION, a Virginia corporation, hereinafter called the “Corporation”, and M. SHANE BELL hereinafter called “Employee”, and provides as follows: 
 RECITALS 
 WHEREAS, the
Corporation is a bank holding company engaged in the operation of a bank; and 
 WHEREAS, Employee has been involved in the management of the
business and affairs of the Corporation and, therefore, possesses managerial experience, knowledge, skills and expertise in such type of business; and 
 WHEREAS, the continued employment of Employee by the Corporation is in the best interests of the Corporation and Employee; and 
 WHEREAS, the parties have mutually agreed upon the terms and conditions of Employee’s continued employment by the Corporation as hereinafter set forth; 
 TERMS OF AGREEMENT 
 NOW, THEREFORE, for and in consideration of the
premises and of the mutual promises and undertakings of the parties as hereinafter set forth, the parties covenant and agree as follows: 
 Section 1. Employment. (a) Employee shall be employed as the Executive Vice President and Chief Financial Officer of the Corporation and its wholly owned subsidiary, First Bank. He shall perform such services for the
Corporation and/or one or more Affiliates as may be assigned to Employee by the Corporation from time to time upon the terms and conditions hereinafter set forth. Employee’s services shall be rendered in a senior management or executive
capacity and shall be of the type for which he is suited by background and training. 
 (b) References in this Agreement to services rendered
for the Corporation and compensation and benefits payable or provided by the Corporation shall include services rendered for and compensation and benefits payable or provided by any Affiliate. References in this Agreement to the
“Corporation” also shall mean and refer to each Affiliate for which Employee performs services. References in this Agreement to “Affiliate” shall mean any business entity that, directly or indirectly, through one or more
intermediaries, is controlled by the Corporation. 
 Section 2. Term. The term of this Agreement shall at all times be two
(2) years, which means that at the end of every day, the term of this Agreement shall be extended for one day. With thirty (30) days notice, however, either party may notify the other that the term of this Agreement shall no longer be
extended and that this Agreement will terminate two (2) years after the effective date of such notice. 

 Section 3. Exclusive Service. Employee shall devote his best efforts and full time to
rendering services on behalf of the Corporation in furtherance of its best interests. Employee shall comply with all policies, standards and regulations of the Corporation now or hereafter promulgated, and shall perform his duties under this
Agreement to the best of his abilities and in accordance with standards of conduct applicable to executive officers of banks. 
 Section 4. Salary. (a) As compensation while employed hereunder, Employee, during his faithful performance of this Agreement, in whatever capacity rendered, shall receive an annual base salary of $140,000.00 payable on such
terms and in such installments as the parties may from time to time mutually agree upon. The Board of Directors, in its discretion, may increase Employee’s base salary during the term of this Agreement; provided, however, that Employee’s
salary after being increased may not be decreased. 
 (b) The Corporation shall withhold state and federal income taxes, social security
taxes and such other payroll deductions as may from time to time be required by law or agreed upon in writing by Employee and the Corporation. The Corporation shall also withhold and remit to the proper party any amounts agreed to in writing by the
Corporation and Employee for participation in any corporate sponsored benefit plans for which a contribution is required. 
 (c) Except as
otherwise expressly set forth hereunder, no compensation shall be paid pursuant to this Agreement in respect of any month or portion thereof subsequent to any termination of Employee’s employment by the Corporation. 
 Section 5. Corporate Benefit Plans. Employee shall be entitled to participate in or become a participant in any employee benefit plan
maintained by the Corporation for which he is or will become eligible on such terms as the Board of Directors may, in its discretion, establish, modify or otherwise change. 
 Section 6. Bonuses. Employee shall receive only such bonuses as the Board of Directors, in its discretion, decides to pay to Employee.

 Section 7. Expense Account. The Corporation shall reimburse Employee for reasonable and customary business expenses incurred
in the conduct of the Corporation’s business. Such expenses will include business meals, out-of-town lodging and travel expenses. Employee agrees to timely submit records and receipts of reimbursable items and agrees that the Corporation can
adopt reasonable rules and policies regarding such reimbursement. The Corporation agrees to make prompt payment to Employee following receipt and verification of such reports. Such payment shall be made no later than March 15 following the
calendar year in which the expense was incurred. 
  

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 Section 8. Personal and Sick Leave. Employee shall be entitled to the same personal and sick
leave as the Board of Directors may from time to time designate for all full-time employees of the Corporation. 
 Section 9.
Vacations. Employee shall be entitled to vacations in accordance with policies the Board of Directors sets for all full time employees of the Corporation and during which Employee’s compensation hereunder shall continue to be paid.

 Section 10. Termination. (a) Notwithstanding the termination of Employee’s employment pursuant to any provision of
this Agreement, the parties shall be required to carry out any provisions of this Agreement which contemplate performance by them subsequent to such termination. In addition, no termination shall affect any liability or other obligation of either
party which shall have accrued prior to such termination, including, but not limited to, any liability, loss or damage on account of breach. No termination of employment shall terminate the obligation of the Corporation to make payments of any
vested benefits provided hereunder or the obligations of Employee under Sections 11, 12 and 13. 
 (b) Employee’s employment hereunder
may be terminated by Employee upon thirty (30) days written notice to the Corporation or at any time by mutual agreement in writing. 
 (c) Except as otherwise provided in this Section 10(c), this Agreement shall terminate upon death of Employee. In such event the Corporation shall pay to the estate of Employee the compensation including salary and accrued bonus, if
any, which otherwise would be payable to Employee through the end of the month in which his death occurs. In addition, Employee’s death is not intended to, and shall not, prevent amounts to which Employee would have been entitled under Sections
10(d)(2) or 10(i) had he lived from being paid under this Agreement to Employee’s estate or beneficiaries at the time or times such amounts would have been paid had Employee lived. 
 (d)(1) The Corporation may terminate Employee’s employment other than for “Cause,” as defined in Section 10(e), at any time upon
written notice to Employee, which termination shall be effective immediately. Employee may resign thirty (30) days after notice to the Corporation for “Good Reason”, as hereafter defined. 
 (2) If the Corporation terminates the Employee’s employment without Cause or the Employee resigns for Good Reason, then in either event: 

(i)(A) The Employee shall be paid for the remainder of the then current term of this Agreement, at such times as payment was theretofore made, the
salary required under Section 4 (taking into account any salary increases) that the Employee would have been entitled to receive during the remainder of the then current term of this Agreement had such termination not occurred. 
 (B) Notwithstanding the foregoing, if such termination or resignation occurs within one year after a Change of Control (as defined below), the time at
which the amount described in Section 10(d)(2)(i)(A) is paid shall be determined not under that Section but under Section 10(i), below. 
  

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 (C) Further, payments due under Section 10(d)(2)(i)(A), Section 10(d)(2)(iii), or
Section 10(d)(3) and made to a Key Employee shall commence or be paid on the first day of the month following the six-month anniversary of the Employee’s termination or resignation. The initial payment made under the preceding sentence
shall include amounts that would have been paid under Section 10(d)(2)(i)(A), Section 10(d)(2)(iii), or Section 10(d)(3) through the date of such initial payment had the Employee not been a Key Employee. This
Section 10(d)(2)(i)(C) shall apply to amounts payable to a Key Employee under Section 10(d)(2)(i)(A) even if the timing of the payments is determined under Section 10(i); and 
 (ii) The Corporation shall maintain in full force and effect for the continued benefit of the Employee for the remainder of the then current term of this
Agreement, all employee welfare benefit plans and programs or arrangements in which the Employee was entitled to participate immediately prior to such termination, provided that continued participation is possible under the general terms and
provisions of such plans and programs. In the event that Employee’s participation in any such plan or program is barred, the Corporation shall arrange to provide the Employee with benefits substantially similar to those which the Employee was
entitled to receive under such plan or program. Payments under this Section 10(d)(2)(ii) that do not constitute (i) welfare benefits exempt from Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and
Treasury Regulations thereunder (the “409A Regulations”) or (ii) reimbursed medical expenses exempt under 409A Regulations Section 1.409A-1(b)(9)(v)(B) shall be limited in the aggregate to the applicable dollar amount under Code
Section 402(g)(1)(B) for the year of the separation from service. In addition, any benefits provided to a Key Employee under this Section 10(d)(2)(ii) that are considered deferred compensation subject to Code Section 409A and the 409A
Regulations shall not commence until the first day of the month following the six-month anniversary of the Employee’s termination or resignation. All determinations required under this Section 10(d)(2)(ii) shall be made by independent
counsel selected by the Corporation and reasonably acceptable to the Employee or Key Employee, in accordance with Code Section 409A, the 409A Regulations and other applicable guidance; and 
 (iii) The Employee shall receive a payment in cash on the date his employment terminates equal to the amount of any cash bonus paid to him in respect of
the fiscal year of the Corporation prior to the fiscal year in which his employment terminates, multiplied by a fraction, the numerator of which is the number of days that elapse before the date his employment terminates in the fiscal year of the
Corporation in which his employment terminates and the denominator of which is three hundred sixty-five (365). 
  

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 (3) If, (1) pursuant to the second sentence of Section 2 of this Agreement, the Corporation
notifies Employee that this Agreement shall no longer be extended, (2) the Employee’s employment by the Corporation does not terminate during the two (2) years after the effective date of such notice and (3) the Employee’s
employment by the Corporation terminates after such two (2) year period, then, beginning on the first day of the month that follows the month in which his employment terminates and continuing for the succeeding eleven (11) months, the
Corporation shall pay to the Employee an amount equal to one-twelfth (1/12) of his then current salary. 
 Notwithstanding the
foregoing, at any time after payments begin under the preceding paragraph, the Corporation may, for any reason and without liability, terminate all payments under this Section 10(d)(3); provided, however, from and after the date that the
Corporation terminates such payments pursuant to this Section 10(d)(3), the Employee shall no longer be bound by Section 12; and provided further, if the Employee breaches Section 11 or any provision of Section 12 while receiving
payments under this Section 10(d)(3) (or during any delay in the receipt of payment required by Code Section 409A) and, pursuant to Section 10(d)(4), the Corporation then terminates payments on account of such breach, the Employee
shall remain bound by Section 12. 
 (4) Notwithstanding anything in this Agreement to the contrary, if Employee breaches
Section 11 or 12, Employee will not thereafter be entitled to receive any further compensation or benefits pursuant to this Section 10(d). In addition, notwithstanding anything in this Agreement to the contrary, the Corporation shall not
be required to make any payment that is prohibited by the terms of the regulations presently found at 12 C.F.R. part 359 or to the extent that any other governmental approval of the payment required by law is not received. 
 (5) For purposes of this Agreement, “Good Reason” shall mean: 
 (i) The assignment of duties to the Employee by the Corporation which result in the Employee having significantly less authority or responsibility than he has on the date hereof, without his express written consent;

 (ii) Requiring the Employee to maintain his principal office anywhere outside of the Virginia Counties of Frederick, Warren and
Shenandoah, or cities located therein; 
 (iii) The failure of the Corporation to provide the Employee with substantially the same fringe
benefits that are provided to him at the inception of this Agreement; 
 (iv) The Corporation’s failure to comply with any material
term of this Agreement; 
 (v) The failure of the Corporation to obtain the assumption of and agreement to perform this Agreement by any
successor as contemplated in Section 14 hereof; or 
  

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 (vi) The Corporation’s elimination, on or after a Change of Control, of any benefit plan, program
or arrangement (including without limitation a tax-qualified retirement plan) or any change, made on or after a Change of Control, to such plan, program or arrangement that reduces the value of the affected benefit to the Employee. 
 (6) For purposes of this Agreement, “Key Employee” shall mean any Employee who, as of December 31 of any calendar year, satisfies the
requirement of Code Section 416(i)(1)(A)(i), (ii), or (iii) (applied in accordance with Treasury Regulations thereunder and disregarding Code Section 416(i)(5)). An Employee who meets the criteria set forth in the preceding sentence
will be considered a Key Employee for purposes of this Agreement for the 12-month period commencing on the next following April 1. For example, an Employee who meets the definition of Key Employee as of December 31, 2008, will be
considered a Key Employee from April 1, 2009 through March 31, 2010, when applying the special rules for Key Employees found in this Agreement. 
 (e) The Corporation shall have the right to terminate Employee’s employment under this Agreement at any time for Cause, which termination shall be effective immediately. Termination for “Cause” shall
include termination for Employee’s failure, neglect or refusal to perform his duties and responsibilities without the same being corrected after ten days prior written notice or termination because of his personal dishonesty, incompetence,
willful misconduct, breach of a fiduciary duty involving personal profit, willful violation of any law, rule or regulation (other than traffic violations or similar offenses) conviction of a felony or of a misdemeanor involving moral turpitude,
misappropriation of the Corporation’s assets (determined on a reasonable basis) or those of its Affiliates, or material breach of any other provision of this Agreement. Termination for Cause also shall include termination as a result of the
Employee’s failure to correct a material deficiency in the performance of his duties within 60 days after a written notice from the Board of Directors or such other reasonable period of time specified by the Board of Directors if such
deficiency cannot be cured within 60 days. Any notice given under this subsection shall state that it is a notice pursuant to Section 10(e) of this Agreement and shall set forth the Board’s complaints in detail sufficient to allow Employee
to understand and correct them. In the event Employee’s employment under this Agreement is terminated for Cause, Employee shall thereafter have no right to receive compensation or other benefits under this Agreement. 
 (f) The Corporation may terminate Employee’s employment under this Agreement, after having established the Employee’s disability by giving to
Employee written notice of its intention to terminate his employment for disability and his employment with the Corporation shall terminate effective on the 90th day after receipt of such notice if within 90 days after such receipt Employee shall
fail to return to the full-time performance of the essential functions of his position (and if Employee’s disability has been established pursuant to the definition of “disability” set forth below). For purposes of this Agreement,
“disability” means either (i) disability which after the expiration of more than 13 consecutive weeks after its commencement is determined to be total and permanent by a physician selected and paid for by the Corporation or its
insurers, and acceptable to Employee or his legal representative, which consent shall not be unreasonably withheld or (ii) disability as defined in the policy of disability insurance maintained by the Corporation or its Affiliates for the
benefit of Employee, whichever shall be more favorable to Employee. Notwithstanding any other provision of this Agreement, the Corporation shall comply with all requirements of the Americans with Disabilities Act, 42 U.S.C. § 12101 et.
seq. 
  

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 (g) If Employee is suspended and/or temporarily prohibited from participating in the conduct of the
Corporation’s affairs by a notice served pursuant to the Federal Deposit Insurance Act, the Corporation’s obligations under this Employment Agreement shall be suspended as of the date of service unless stayed by appropriate proceedings. If
the charges in the notice are dismissed, the Corporation may in its discretion (i) pay Employee all or part of the compensation withheld while its contract obligations were suspended, and (ii) reinstate (in whole or in part) any of its
obligations which were suspended. If any payment of withheld compensation is made under this Section 10(g) in the Corporation’s sole discretion, it shall be made by March 15 following the calendar year in which the charges in the
applicable notice are dismissed. 
 (h) If Employee is removed and/or permanently prohibited from participating in the conduct of the
Corporation’s affairs by an order issued under the Federal Deposit Insurance Act or the Code of Virginia, all obligations of the Corporation under this Employment Agreement shall terminate as of the effective date of the order, but vested
rights of the parties shall not be affected. 
 (i)(1) If Employee’s employment is terminated without Cause or if he resigns for Good
Reason within one year after a Change of Control shall have occurred, then on Employee’s last day of employment with the Corporation, the Corporation shall pay to Employee as compensation for services rendered to the Corporation and its
Affiliates a lump sum cash amount (subject to any applicable payroll or other taxes required to be withheld) equal to the excess, if any, of 299% of Employee’s “annualized includable compensation for the base period”, as defined in
Code Section 280G, over the total amount payable to Employee under Section 10(d). In addition, under such circumstances, if an election has been made pursuant to Section 10(i)(2), below, the amount to which Employee is entitled under
Section 10(d)(2)(i) shall not be subject to the payment schedule called for under Section 10(d)(2)(i) but instead shall be paid in accordance with such election. 
 (2) Employee may elect, prior to December 31, 2007, to have the total cash amount to which he is entitled under Sections 10(d)(2)(i) and 10(i)(1)
paid in a single lump sum or in 24 or 36 equal monthly installments, with the lump sum or first installment paid on the date of termination or resignation and the remaining installments, if any, paid on the first day of each succeeding month. Such
election shall not apply to amounts otherwise payable in the year the election is made nor cause amounts to be paid in the year the election is made that would not otherwise be payable in that year. Subsequent changes to the time or form of payment
of such cash amount shall be made only in accordance with Code Section 409A, the 409A Regulations, and other applicable guidance, including any transition rules promulgated by the Internal Revenue Service. 
 (3) Notwithstanding the foregoing, the timing of an amount payable to a Key Employee under the first sentence of Section 10(i)(1) (whether or not
subject to an installment election) above shall be determined as follows: the lump sum payment shall be made or installments shall commence on the first day of the month following the six-month anniversary of the Key Employee’s 

  

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termination or resignation date. The initial payment made under the preceding sentence shall include amounts that would have been paid under the first
sentence of Section 10(i)(1) through the date of such initial payment had the Employee not been a Key Employee. 
 (4) For purposes of
this Agreement, a Change of Control occurs if, after the date of this Agreement, (i) any person, including a “group” as defined in Section 13(d)(3) of the Securities Exchange Act of 1934, becomes the owner or beneficial owner of
Corporation securities having 50% or more of the combined voting power of the then outstanding Corporation securities that may be cast for the election of the Corporation’s directors other than a result of an issuance of securities initiated by
the Corporation, or open market purchases approved by the Board of Directors, as long as the majority of the Board of Directors approving the purchases is a majority at the time the purchases are made; or (ii) as the direct or indirect result
of, or in connection with, a tender or exchange offer, a merger or other business combination, a sale of assets, a contested election of directors, or any combination of these events, the persons who were directors of the Corporation before such
events cease to constitute a majority of the Corporation’s Board, or any successor’s board, within two years of the last of such transactions. For purposes of this Agreement, a Change of Control occurs on the date on which an event
described in (i) or (ii) occurs. If a Change of Control occurs on account of a series of transactions or events, the Change of Control occurs on the date of the last of such transactions or events. 
 (5) It is the intention of the parties that no payment be made or benefit provided to Employee pursuant to this Agreement that would constitute an
“excess parachute payment” within the meaning of Section 280G of the Code and any regulations thereunder, thereby resulting in a loss of an income tax deduction by the Corporation or the imposition of an excise tax on Employee under
Section 4999 of the Code. If the independent accountants serving as auditors for the Corporation on the date of a Change of Control (or any other accounting firm designated by the Corporation) determine that some or all of the payments or
benefits scheduled under this Agreement, as well as any other payments or benefits on a Change of Control, would be nondeductible by the Company under Section 280G of the Code, then the payments scheduled under this Agreement will be reduced to
one dollar less than the maximum amount which may be paid without causing any such payment or benefit to be nondeductible. The determination made as to the reduction of benefits or payments required hereunder by the independent accountants shall be
binding on the parties. Employee shall have the right to designate within a reasonable period, which payments or benefits will be reduced; provided, however, that if no direction is received from Employee, the Corporation shall implement the
reductions in its discretion. 
 Section 11. Confidentiality/Nondisclosure. Employee covenants and agrees that any and all
information concerning the customers, businesses and services of the Corporation of which he has knowledge or access as a result of his association with the Corporation in any capacity, shall be deemed confidential in nature and shall not, without
the proper written consent of the Corporation, be directly or indirectly used, disseminated, disclosed or published by Employee to third parties other than in connection with the usual conduct of the business of the Corporation. Such information
shall expressly include, but shall not be limited to, 

  

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information concerning the Corporation’s trade secrets, business operations, business records, customer lists or other customer information. Upon
termination of employment Employee shall deliver to the Corporation all originals and copies of documents, forms, records or other information, in whatever form it may exist, concerning the Corporation or its business, customers, products or
services. In construing this provision it is agreed that it shall be interpreted broadly so as to provide the Corporation with the maximum protection. This Section 11 shall not be applicable to any information which, through no misconduct or
negligence of Employee, has previously been disclosed to the public by anyone other than Employee. 
 Section 12. Covenant Not to
Compete. During the term of this Agreement and throughout any further period that he is an officer or employee of the Corporation, and for a period of twelve (12) months from and after the date that Employee is (for any reason) no longer
employed by the Corporation or for a period of twelve (12) months from the date of entry by a court of competent jurisdiction of a final judgment enforcing this covenant in the event of a breach by Employee, whichever is later, Employee
covenants and agrees that he will not, directly or indirectly, either as a principal, agent, employee, employer, stockholder, co-partner or in any other individual or representative capacity whatsoever: (i) engage in a Competitive Business
anywhere within a ten (10) mile straight-line radius of any office operated by the Corporation on the date Employee’s employment terminates; or (ii) solicit, or assist any other person or business entity in soliciting, any depositors
or other customers of the Corporation to make deposits in or to become customers of any other financial institution conducting a Competitive Business; or (iii) induce any individuals to terminate their employment with the Corporation or its
Affiliates. As used in this Agreement, the term “Competitive Business” means all banking and financial products and services that are substantially similar to those offered by the Corporation on the date that Employee’s employment
terminates. Except as otherwise expressly provided in Section 10(d)(3) of this Agreement, the parties intend that the covenants and restrictions in this Section 12 be enforceable against Employee regardless of the reason that his
employment by the Corporation may terminate and that such covenants and restrictions shall be enforceable against Employee even if this Agreement expires after a notice of nonrenewal given by Employee or the Corporation under Section 2 of this
Agreement. 
 Section 13. Injunctive Relief, Damages, Etc. Employee agrees that given the nature of the positions held by
Employee with the Corporation, that each and every one of the covenants and restrictions set forth in Sections 11 and 12 above are reasonable in scope, length of time and geographic area and are necessary for the protection of the significant
investment of the Corporation in developing, maintaining and expanding its business. Accordingly, the parties hereto agree that in the event of any breach by Employee of any of the provisions of Sections 11 or 12 that monetary damages alone will not
adequately compensate the Corporation for its losses and, therefore, that it may seek any and all legal or equitable relief available to it, specifically including, but not limited to, injunctive relief and Employee shall be liable for all damages,
including actual and consequential damages, costs and expenses, including legal costs and actual attorneys’ fees, incurred by the Corporation as a result of taking action to enforce, or recover for any breach of, Section 11 or
Section 12. The covenants contained in Sections 11 and 12 shall be construed and interpreted in any judicial proceeding to permit their enforcement to the maximum extent permitted by law. Should a court of competent jurisdiction determine that
any provision of 

  

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the covenants and restrictions set forth in Section 12 above is unenforceable as being overbroad as to time, area or scope, the court may strike the
offending provision or reform such provision to substitute such other terms as are reasonable to protect the Corporation’s legitimate business interests. 
 Section 14. Binding Effect/Assignability. This Employment Agreement shall be binding upon and inure to the benefit of the Corporation and Employee and their respective heirs, legal representatives,
executors, administrators, successors and assigns, but neither this Agreement, nor any of the rights hereunder, shall be assignable by Employee or any beneficiary or beneficiaries designated by Employee. The Corporation will require any successor
(whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business, stock or assets of the Corporation, by agreement in form and substance reasonably satisfactory to the Employee, to expressly
assume and agree to perform this Agreement in its entirety. Failure of the Corporation to obtain such agreement prior to the effectiveness of any such succession shall be a breach of this Agreement and shall entitle the Employee to the compensation
described in Sections 10(d) and 10(i). As used in this Agreement, “Corporation” shall mean First National Corporation, a Virginia corporation, and any successor to its respective business, stock or assets as aforesaid which executes and
delivers the agreement provided for in this Section 14 or which otherwise becomes bound by all the terms and provisions of this Agreement by operation of law. 
 Section 15. Governing Law. This Employment Agreement shall be subject to and construed in accordance with the laws of Virginia. 
 Section 16. Invalid Provisions. The invalidity or unenforceability of any particular provision of this Employment Agreement shall not affect
the validity or enforceability of any other provisions hereof, and this Employment Agreement shall be construed in all respects as if such invalid or unenforceable provisions were omitted. 
 Section 17. Notices. Any and all notices, designations, consents, offers, acceptance or any other communications provided for herein shall be
given in writing and shall be deemed properly delivered if delivered in person or by registered or certified mail, return receipt requested, addressed in the case of the Corporation to its registered office or in the case of Employee to his last
known address. 
 Section 18. Entire Agreement.  
 (a) This Employment Agreement constitutes the entire agreement among the parties with respect to the subject matter hereof and supersedes any and all other agreements, either oral or in writing, among the parties
hereto with respect to the subject matter hereof. 
 (b) This Employment Agreement may be executed in one or more counterparts, each of which
shall be considered an original copy of this Agreement, but all of which together shall evidence only one agreement. 
  

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 Section 19. Amendment and Waiver. This Employment Agreement may not be amended except by an
instrument in writing signed by or on behalf of each of the parties hereto. No waiver of any provision of this Employment Agreement shall be valid unless in writing and signed by the person or party to be charged. 
 Section 20. Case and Gender. Wherever required by the context of this Employment Agreement, the singular or plural case and the masculine,
feminine and neuter genders shall be interchangeable. 
 Section 21. Captions. The captions used in this Employment Agreement are
intended for descriptive and reference purposes only and are not intended to affect the meaning of any Section hereunder. 
 Section 22.
Code Section 409A. This Employment Agreement is intended to satisfy the requirements of Code Section 409A, the 409A Regulations, and other guidance, including transition rules, issued thereunder. Each provision and term of this
Employment Agreement should be interpreted accordingly, but if any provision or term would be prohibited by or inconsistent with Code Section 409A, the 409A Regulations, or such other guidance, the parties agree that such provision or term may
be amended to the extent necessary to comply with or qualify for an exemption from Code Section 409A, the 409A Regulations, and such other guidance in a manner determined by independent counsel selected by the Corporation and reasonably
acceptable to Employee. 
  

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 IN WITNESS WHEREOF, the Corporation has caused this amended and restated Employment Agreement to be
signed by its duly authorized officer and Employee has hereunto set his hand and seal on the      day of
                    , 2007. 
  

			
	FIRST NATIONAL CORPORATION
		
	  
	 	(SEAL)
	Harry S. Smith, President and Chief Executive Officer

  

	
	ATTEST:
	
	  

  

			
	EMPLOYEE	 	
		
	  
	 	(SEAL)
	M. Shane Bell	 	

  

	
	ATTEST:
	
	  

  

 12Employment Agreement

 Exhibit 10.3 
 AMENDED AND RESTATED 
 EMPLOYMENT AGREEMENT 
 THIS EMPLOYMENT AGREEMENT, as hereby amended and restated, is made by and between FIRST NATIONAL CORPORATION, a Virginia corporation (First National
Corporation and its wholly owned subsidiary, First Bank, hereinafter referred to as the “Bank”), and Marshall J. Beverley, Jr. (the “Employee”), and provides as follows: 
 RECITALS 
 WHEREAS, the Bank is a bank holding company engaged in the
operation of a bank; and 
 WHEREAS, the Employee has knowledge, skills and expertise as a trust officer; and 
 WHEREAS, the Bank desires to employ Employee and Employee desires to accept such employment. 
 NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, the sufficiency of which are hereby acknowledged, the parties
agree as follows: 
 TERMS OF AGREEMENT 
 Section 1. Employment. (a) Employee shall be employed as Executive Vice President – Senior Trust Officer of the Bank and its wholly owned subsidiary, First Bank. He shall perform such
services for the Bank upon the terms and conditions hereinafter set forth. 
 (b) The parties recognize that the President of the Bank, with
the advice and consent of the Board of Directors, shall manage the business affairs of the Bank and that the relationship between the Bank and Employee shall be that of an employer and an employee. The President shall have the sole authority to set
and establish the hours of operation of the business and to set and establish reasonable work schedules and standards applicable to Employee. 
 Section 2. Effective Date and Term. The effective date of this amended and restated Agreement shall be June 1, 2007 (“Effective Date”). The term of this Agreement shall at all times be two (2) years,
which means that at the end of every day, the term of this Agreement shall be extended for one day. With thirty (30) days notice, however, either party may notify the other that the term of this Agreement shall no longer be extended and that
this Agreement will terminate two (2) years after the effective date of such notice. 
 Section 3. Exclusive Service.

 a. Employee shall devote his best efforts and full time to rendering services on behalf of the Bank in furtherance of its best
interests. Employee shall comply with all policies, standards and regulations of the Bank now or hereafter promulgated, and shall perform the duties of a Trust Officer, as described below, to the best of his abilities and in accordance with
standards of conduct applicable to trust officers in the banking industry. 

 b. Employee and the Bank recognize and agree that Employee’s duties as a Trust Officer of the Bank
shall be as follows: 
 i. Employee shall be responsible for administration of personal/trust fiduciary relationship and/or duties related to
fiduciary accounts, such as trusts, estates, agency accounts, investment management accounts, custody accounts, and bank power of attorney accounts. 
 ii. In the performance of his duties, Employee shall ensure that fiduciary standards are being met and that Trust Department policies and procedures are being observed. Employee shall participate in the creation and
revision, as may be necessary from time to time, of the Bank’s Trust Department policies and procedures. 
 iii. Employee shall seek to
contribute to the growth, profitability and retention of trust accounts through active participation in business development for new business. 
 iv. Employee shall maintain good working relationships with clients, attorneys, CPAs and other related professionals to assure quality service and enhance business development. 
 v. Employee shall keep up to date on legal issues, regulations, investment and tax issues and developments in the trust industry and shall inform the
Bank of any changes in the legal environment pertaining to trusts of which Employee becomes aware which may cause the Bank to modify its Trust Department policies and procedures. 
 vi. Although the Employee will work with the Bank’s retail banking operation in a concerted effort to achieve overall banking growth, both Employee
and the Bank recognize that the Employee is a Trust Specialist and Employee shall not be directed to perform tasks directed related to retail banking (loans, deposit accounts, etc.). 
 vii. Employee shall have the responsibility to assist in the management and oversight of the Bank’s Trust Department and its employees. 

Section 4. Salary. 
 (a) As compensation while employed hereunder, Employee, during his faithful performance of this Agreement, shall receive an annual base salary of $135,000.00 payable on such terms and in such installments as the parties may from time to
time mutually agree upon. The Board of Directors, in its discretion, may increase Employee’s base salary during the term of this Agreement; provided, however, that Employee’s salary after being increased may not be decreased without
Employee’s consent. 
  

 2 

 (b) The Bank shall withhold state and federal income taxes, social security taxes and such other payroll
deductions as may from time to time be required by law or otherwise agreed upon in writing by Employee and the Bank. The Bank shall also withhold and remit to the proper party any amounts agreed to in writing by the Bank and Employee for
participation in any corporate sponsored benefit plan for which a contribution is required. 
 (c) Except as otherwise expressly set forth
hereunder, no compensation shall be paid pursuant to this Agreement in respect of any month or portion thereof subsequent to any termination of Employee’s employment by the Bank. 
 Section 5. Corporate Benefit Plans. Employee shall be entitled to participate in or become a participant in any employee benefit plan
maintained by the Bank for which he is or will become eligible on such terms and the Board of Directors may, in its discretion, establish, modify or otherwise change. 
 Section 6. Bonuses. Employee shall receive only such bonuses as the Board of Directors, in its discretion, decides to pay to Employee. 
 Section 7. Expense Account. The Bank shall reimburse Employee for reasonable and customary business expenses incurred in the conduct
of the Bank’s business. Such expenses will include business meals, out-of-town lodging and travel expenses. Employee agrees to timely submit records and receipts of reimbursable items and agrees that the Bank may adopt reasonable rules and
policies regarding such reimbursement. The Bank agrees to make prompt payment to Employee following receipt and verification of such reports. Such payment shall be made no later than March 15 following the calendar year in which the expense was
incurred. 
 Section 8. Personal and Sick Leave. Employee shall be entitled to the same personal and sick leave as the
Board of Directors may from time to time designate for all full-time employees of the Bank. 
 Section 9. Vacations.
Employee will be entitled to paid vacation in accordance with the most favorable plans, policies, and programs of the Bank, but in no event less than four weeks of paid vacation per year. 
 Section 10. Country Club Dues. During Employee’s active employment with the Bank, the Bank shall pay the Employee’s entrance
and membership dues at the Winchester Country Club as well as the monthly charges as may be established by the Club from time to time. Employee shall be responsible for the tax consequences of such benefits as may be required under the Internal
Revenue Code. 
 Section 11. Termination of Employment. 
 (a) Death. The Employee’s employment will terminate automatically upon the Employee’s death. 
  

 3 

 (b) Disability. The Bank may terminate Employee’s employment under this Agreement, after
having established the Employee’s disability by giving to Employee written notice of its intention to terminate his employment for disability and his employment with the Bank shall terminate effective on the 90 day after receipt of such notice
if within 90 days after such receipt Employee shall fail to return to the full-time performance of the essential functions of his position (and if Employee’s disability has been established pursuant to the definition of “disability”
set forth below). For purposes of this Agreement, “disability” means either (i) disability which after the expiration of more than 13 consecutive weeks after its commencement is determined to be total and permanent by a physician
selected and paid for by the Bank or its insurers, and acceptable to Employee or his legal representative, which consent shall not be unreasonably withheld or (ii) disability as defined in the policy of disability insurance maintained by the
Bank for the benefit of Employee, whichever is more favorable to the Employee. Notwithstanding any other provision of this Agreement, the Bank shall comply with all requirements of the Americans with Disabilities Act, 42 U.S.C. § 12101 et
seq. 
 (c) Cause. The Bank may terminate the Employee’s employment for Cause. Termination for “Cause” shall mean a
good faith determination by the Bank that Employee has committed acts of personal dishonesty, incompetence, willful misconduct, breach of a fiduciary duty involving personal profit, intentional failure to perform state duties, willful violation of
law (other than traffic violations or similar offenses) or final cease-and-desist order, conviction of a felony or of a misdemeanor involving moral turpitude, misappropriation of the Bank’s assets or material breach of this Agreement.
Termination for Cause also shall include termination as a result of Employee’s failure to correct a material deficiency in the performance of his duties within 60 days after a written notice from the Board of Directors or such other reasonable
period of time specified by the Board of Directors if such deficiency cannot be cured within 60 days. Any notice given under this subsection shall state that it is a notice pursuant Section 11(c) of this Agreement and shall set forth the
Board’s complaints in detail sufficient to allow Employee to understand and correct them. 
 (d) Good Reason. The Employee’s
employment may be terminated (i) by the Employee for Good Reason, or (ii) during the Window Period by the Employee without any reason. For purposes of this Agreement, the “Window Period” means the 12-month period after a
“Change of Control” as defined in Section 12. For purposes of this Agreement, “Good Reason” means: 
 (i) without
the express written consent of the Employee, (A) the assignment to the Employee of any duties inconsistent in any substantial respect with the Employee’s position, authority or responsibilities as contemplated by Section 3 of this
Agreement, or (B) any other substantial change in such position (including titles), authority or responsibilities; 
 (ii) requiring
Employee to maintain his principal office outside 25 miles proximity to the City of Winchester; 
 (iii) failure of the Bank to provide the
Employee with substantially the same fringe benefits that are provided to him at the inception to this Agreement; 
  

 4 

 (iv) failure of the Bank to comply with any material term of this Agreement; 
 (v) failure of the Bank to obtain the assumption of and agreement to perform this Agreement by any successor as contemplated by Section 17 of this
Agreement; or 
 (vi) The Bank’s elimination, on or after a Change of Control, of any benefit plan, program or arrangement (including
without limitation a tax-qualified retirement plan) or any change, made on or after a Change of Control, to such plan, program or arrangement that reduces the value of the affected benefit to the Employee. 
 Employee shall not be deemed to have resigned for Good Reason hereunder unless with respect to each of (i-vi) above, the Employee has provided written notice to the Bank
within 90 days after the event that the Employee believes gives rise to Employee’s right to terminate employment under this Section 11(d), describing in reasonable detail the facts that provide the basis for such belief, and the Bank has
failed within 30 days from the date of such notice to cure any basis for the Employee’s resignation for Good Reason. 
 (e) Without
Cause or Good Reason. The Bank may terminate Employee’s employment other than for “Cause” at any time upon written notice to Employee. Employee may resign without “Good Reason” upon 30 days written notice to the Bank.

 (f) Notice of Termination. Any termination by the Bank or the Employee shall be communicated by written Notice of Termination to
the other party. For purposes of this Agreement, a “Notice of Termination” shall mean a written notice which shall indicate the specific termination provision in this Agreement upon which the party is relying. 
 (g) Date of Termination. “Date of Termination” means (i) if the Employee’s employment is terminated by the Bank for Cause, or
during the Window Period, the date of receipt of the Notice of Termination or any later date specified therein, as the case may be, (ii) if the Employee’s employment is terminated by the Bank other than for Cause or Disability, or by the
Employee other than for Good Reason or during the Window Period, the date specified in the Notice of Termination (which shall not be less than 30 days after the Notice of Termination is given), and (iii) if the Employee’s employment is
terminated by the Employee for Good Reason, the date which is 30 days after the date of receipt of the Notice of Termination if the Bank has not, prior to such date, cured the basis for the notice as provided for in Section 11(d); and
(iv) if the Employee’s employment is terminated for Disability, 30 days after Notice of Termination is given, provided that the employee shall not have returned to full-time performance of his duties during such 30-day period. 

(h) If Employee is suspended and/or temporarily prohibited from participating in the conduct of the Bank’s affairs by a notice served pursuant to
the Federal Deposit Insurance Act, the Bank’s obligations under this Employment Agreement shall be suspended as of the date of service unless stayed by appropriate proceedings. If the charges in the notice are dismissed, the Bank may in its
discretion (i) pay Employee all or part of the compensation withheld while its contract obligations were suspended, and 

  

 5 

 
(ii) reinstate (in whole or in part) any of its obligations which were suspended. If any payment of withheld compensation is made under this
Section 11(h) in the Bank’s sole discretion, it shall be made by March 15 following the calendar year in which the charges in the applicable notice are dismissed. 
 (i) If Employee is removed and/or permanently prohibited from participating in the conduct of the Bank’s affairs by an order issues under the
Federal Deposit Insurance Act or the Code of Virginia, all obligations of the Bank under this Employment Agreement shall terminate as of the effective date of the order, but vested rights of the parties shall not be affected. 
 Section 12. Compensation Upon Termination. 
 (a) Good Reason or Without Cause. If the Bank terminates the Employee’s employment without Cause or the Employee resigns for Good Reason and such termination or resignation has not occurred within twelve
(12) months following a Change of Control, then in either event: 
 (i) Employee shall be paid for the remainder of the then current
term of this Agreement, at such times as payment was theretofore made, the salary required under Section 4 of this Agreement (taking into account any salary increases) had such termination not occurred. Notwithstanding the foregoing or the
timing of payment established in Section 12(a)(iii), if the Employee is a “Key Employee”, as hereafter defined, payments under this Section 12(a)(i) and Section 12(a)(iii), to the extent considered “deferred
compensation” under Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), shall commence or be paid on the first day of the month following the six-month anniversary of the Employee’s termination or
resignation. The initial payment made under the preceding sentence shall include amounts that would have been paid under this Section 12(a)(i) and Section 12(a)(iii) through the date of such initial payment had the Employee not been a Key
Employee; and 
 (ii) The Bank shall maintain in full force and effect for the continued benefit of the Employee for the remainder of the
then current term of this Agreement all employee welfare benefit plans and programs or arrangements in which the Employee was entitled to participate immediately prior to such termination, provided that continued participation is possible under the
general terms and provisions of such plans and programs. In the event that Employee’s participation in any such plan or program is barred, the Bank shall arrange to provide the Employee with benefits substantially similar to those which the
Employee was entitled to receive under such plan or program. Payments under this Section 12(a)(ii) that do not constitute (i) welfare benefits exempt from Section 409A of the Internal Revenue Code of 1986, as amended (the
“Code”) and Treasury Regulations thereunder (the “409A Regulations”) or (ii) reimbursed medical expenses exempt under 409A Regulations Section 1.409A-1(b)(9)(v)(B) shall be limited in the aggregate to the applicable
dollar amount under Code Section 402(g)(1)(B) for the year of the separation from service. In addition, any benefits provided to a Key Employee under this Section 12(a)(ii) that are considered deferred compensation subject to Code
Section 409A and the 409A Regulations shall not commence until the first day of the month following the six-month anniversary of the Employee’s termination or resignation. All determinations required under this Section 12(a)(ii) shall
be made by independent counsel selected by the Bank and reasonably acceptable to the Employee or Key Employee, in accordance with Code Section 409A, the 409A Regulations, and other applicable guidance; and 
  

 6 

 (iii) A lump sum payment in cash shall be made to Employee on the date his employment terminates equal
to the amount of his Accrued Obligations. “Accrued Obligations” shall be defined as the sum of: 
 (1) the Executive’s Annual
Base Salary earned but not yet paid through the Date of Termination at the rate in effect just before a Notice of Termination is given; 
 (2) the amount, if any, of any incentive or bonus compensation theretofore earned which has not yet been paid; 
 (3) a pro-rated
bonus for the year in which the termination occurs which equals the product of any bonus paid or payable, including by reason of deferral, for the most recently completed year multiplied by a fraction, the numerator of which is the number of days in
the current year through the Date of Termination and the denominator of which is 365; and 
 (4) any benefits or awards (including both the
cash and stock components) which pursuant to the terms of any plans, policies or programs have been earned prior to the date of termination, but which have not yet been paid to the Employee (but not including amounts that previously had been
deferred at the Employee’s request, which amounts will be paid in accordance with the Employee’s existing directions, to the extent permitted by applicable law, including tax laws). 
 (iv) For purposes of this Agreement, “Key Employee” shall be defined as any Employee who, as of December 31 of any calendar year,
satisfies the requirement of Code Section 416(i)(1)(A)(i), (ii), or (iii) (applied in accordance with Treasury Regulations thereunder and disregarding Code Section 416(i)(5)). An Employee who meets the criteria set forth in the
preceding sentence will be considered a Key Employee for purposes of this Agreement for the 12-month period commencing on the next following April 1. For example, an Employee who meets the definition of Key Employee as of December 31,
2008, will be considered a Key Employee from April 1, 2009 through March 31, 2010, when applying the special rules for Key Employees found in this Agreement. 
 Notwithstanding anything in this Agreement to the contrary, if Employee breaches Section 13 or 14, Employee will not thereafter be entitled to receive any further compensation or benefits pursuant to this
Section 12(a). In addition, notwithstanding anything in this Agreement to the contrary, the Bank shall not be required to make any payment that is prohibited by the terms of the regulations presently found at 12 C.F.R. part 359 or to the extent
that any other governmental approval of the payment is not received. 
  

 7 

 (b) Death or Disability. If this Agreement terminates as a result of Employee’s death or
disability, the Bank will have no further obligation under this Agreement other than for payment of the Accrued Obligations (as defined in Section 12(a)(iii)); provided, however, that Employee’s death is not intended to, and shall not,
prevent amounts to which Employee would have been entitled under Sections 12(a), 12(c) or 12(d) had he lived from being paid to Employee’s estate or beneficiaries at the time or times such amounts would have been paid had Employee lived.

 (c) Cause; Voluntary Termination Without Good Reason. If the Employee’s employment is terminated for Cause, this Agreement
will terminate without further obligation to the Employee other than the payment to the Employee of salary earned but not yet paid through the Date of Termination. If the Employee terminates employment, excluding a termination for Good Reason or
during the Window Period, this Agreement will terminate without further obligation to the Employee other than the Accrued Obligations (as defined in Section 12(a)(iii) above, but not including the sum in Section 12(a)(iii)(3)), which will
be paid in a lump sum in cash 30 days following the Date of Termination, and any other benefits to which the Employee may be entitled pursuant to the terms of any plan, program or arrangement of the Bank. Notwithstanding the foregoing, if Employee
is a Key Employee on his Date of Termination, to the extent Accrued Obligations or other amounts payable under this Section 12(c) are considered to provide for a deferral of compensation under Code Section 409A, they shall be paid on the
first day of the month following the six-month anniversary of Employee’s Date of Termination. 
 (d) Termination After a Change in
Control. 
 (i) If the Employee terminates his employment with the Bank for any reason during the Window Period after a Change in Control
or the Employee’s employment is terminated without Cause during the Window Period after a Change in Control, the Employee will be entitled to the sum of Accrued Obligations (as defined in Section 12(a)(iii)) plus a cash amount (subject to
any applicable payroll or other taxes required to be withheld) equal to the excess, if any, of 299% of the Employee’s “annualized includable compensation for the base period,” as defined in Code Section 280G, over the total
amount payable to the Employee under Section 12(a)(i), payable in a single lump sum on the Date of Termination. 
 (ii) Employee may
elect, prior to December 31, 2007, to have the cash amount (other than the Accrued Obligations) to which he is entitled under Section 12(d)(i) paid in 24 or 36 equal monthly installments, with the first installment paid on the date of
termination or resignation and the remaining installments paid on the first day of each succeeding month. Such election shall not apply to amounts otherwise payable in the year the election is made, nor cause amounts to be paid in the year the
election is made that would not otherwise be payable in that year. Subsequent changes to the time or form of payment of such cash amount shall be made only in accordance with Code Section 409A, the 409A Regulations, and other applicable
guidance, including any transition rules promulgated by the Internal Revenue Service. 
 (iii) Notwithstanding the foregoing, the timing of
an amount payable to a Key Employee under Section 12(d) (whether or not subject to an installment election) shall be determined as follows: the lump sum payment shall be made or installments shall commence on the first day of the month
following the six-month anniversary of Employee’s Date of Termination. 

  

 8 

 
The initial payment made under the preceding sentence shall include amounts that would have been paid under Section 12(d) through the date of such
initial payment had the Employee not been a Key Employee. Accrued Obligations payable to a Key Employee under Section 12(d) shall be paid on the first day of the month following the six-month anniversary of the Employee’s Date of
Termination. 
 (iv) For purposes of this Agreement, a “Change of Control” occurs if, after the date of this Agreement,
(i) any person, including a “group” as defined in Section 13(d)(3) of the Securities Exchange Act of 1934, becomes the owner or beneficial owner of Bank securities having 50% or more of the combined voting power of the then
outstanding Bank securities that may be cast for the election of the Bank’s directors other than as a result of an issuance of securities initiated by the Bank, or open market purchases approved by the Board of Directors, as long as the
majority of the Board of Directors approving the purchases is a majority at the time the purchases are made; or (ii) as the direct or indirect result of, or in connection with, a tender or exchange offer, a merger or other business combination,
a sale of assets, a contested election of directors, or any combination of these events, the persons who were directors of the Bank before such events cease to constitute a majority of the Bank’s Board, or any successor’s board, within two
years of the last of such transactions. For purposes of this Agreement, a Change of Control occurs on the date on which an event described in (i) or (ii) occurs. If a Change of Control occurs on account of a series of transactions or
events, the Change of Control occurs on the date of the last of such transactions or events. 
 (v) It is the intention of the parties that
no payment be made or benefit provided to Employee pursuant to this Agreement that would constitute an “excess parachute payment” within the meaning of Section 280G of the Code and any regulations thereunder, thereby resulting in a
loss of an income tax deduction by the Bank or the imposition of an excise tax on Employee under Section 4999 of the Code. If the independent accountants serving as auditors for the Bank on the date of a Change of Control (or any other
accounting firm designated by the Bank) determine that some or all of the payments or benefits scheduled under this Agreement, as well as any other payments or benefits on a Change of Control, would be nondeductible by the Company under
Section 280G of the Code, then the payments scheduled under this Agreement will be reduced to one dollar less than the maximum amount which may be paid without causing any such payment or benefit to be nondeductible. The determination made as
to the reduction of benefits or payments required hereunder by the independent accountants shall be binding on the parties. Employee shall have the right to designate within a reasonable period, which payments or benefits will be reduced; provided,
however, that if no direction is received from Employee, the Bank shall implement the reductions in its discretion. 
 Section 13.
Confidentiality/Nondisclosure. 
 Employee covenants and agrees that any and all information concerning the customers, businesses
and services of the Bank of which he has knowledge or access as a result of his association with the Bank in any capacity, shall be deemed confidential in nature and shall not, without the written consent of the Bank, be directly or indirectly used,
disseminated, disclosed or published by Employee to third parties other than in connection with the usual conduct of the business of the Bank. Such information shall 

  

 9 

 
expressly include, but shall not be limited to, information concerning the Bank’s trade secrets, business operations, business records, customer lists
or other customer information. Upon termination of employment, Employee shall deliver to the Bank all originals and copies of documents, forms, records or other information, in whatever form it may exist, concerning the Bank or its business,
customers, products or services. This Section 13 shall not be applicable to any information which, through no misconduct of Employee, has previously been disclosed to the public by anyone other than Employee. 
 Section 14. Covenant Not to Compete 
 If Employee resigns for Good Reason or during the Window Period or if the Bank terminates the Employee’s employment other than for Cause and Employee receives the payments provided for in Section 12(a) or
(d), then for a period of twelve (12) months from and after Employee is no longer employed by the Bank or for a period of twelve (12) months from the date of entry by a court of competent jurisdiction of a final judgment enforcing this
covenant in the event of a breach by Employee, whichever is later, Employee covenants and agrees that he will not, directly or indirectly, either as a principal, agent, employee, employer, stockholder, co partner or in any other individual or
representative capacity whatsoever: (i) engage in a Competitive Business anywhere within a ten (10) mile radius of any office operated by the Bank as of the date of the execution of this Agreement; or (ii) solicit, or assist any other
person or business entity in soliciting, any depositors or other customers of the Bank to make deposits in or to become customers of any other financial institution conducting a Competitive Business; or (iii) induce any individuals to terminate
their employment with the Bank. 
 As used in this Agreement, the terms “solicit” and “soliciting” shall include, but not
be limited to contacting customers of the Bank for the purpose of advising them of Employee’s new contact information; however, it does not include placement of announcements in a publication by a subsequent employer of the Employee announcing
Employee’s new place of employment, nor does it include responding to inquiries initiated by a customer about Employee’s new contact information. 
 As used in this Agreement, the term “Competitive Business” means establishing an office within the restricted geographic area that provides banking and financial products and services that are substantially
similar to those offered by the Bank on the date that Employee’s employment terminates. Nothing in this Section 14 is intended to prohibit Employee from meeting with Employee’s clients within the restricted geographic area.

 Section 15. Injunctive Relief, Damages, Etc. 
 Employee agrees that given the nature of the positions to be held by Employee with the Bank, that each and every one of the covenants and restrictions in
Sections 13 and 14 above are reasonable in scope, length of time and geographic area and are necessary for the protection of the Bank in developing, maintaining and expanding its business. Accordingly, the parties hereto agree that in the event of
any breach by Employee of any of the provisions of Sections 13 and 14 that monetary damages alone will not adequately compensate the Bank for its losses and, therefore, that it may seek any and all legal or equitable relief available to it,
specifically 

  

 10 

 
including, but not limited to, injunctive relief and if relief is awarded in favor of the Bank, Employee shall be liable for all damages, including actual
and consequential damages, costs and expenses (excluding attorneys fees) incurred by the Bank as a result of taking to enforce, or recover for any breach of Sections 13 and 14. Should a court of competent jurisdiction determine that any provision of
the covenants set forth in Section 14 is unenforceable as being overbroad as to time, area or scope, the court may strike the offending provision or reform such provision to substitute such other terms as are reasonable to protect the
Bank’s legitimate business interests. 
 Section 16. Binding Effect/Assignability. 
 This Employment Agreement shall be binding upon and inure to the benefit of the Bank and Employee and their respective heirs, legal representatives,
executors, administrators, successors and assigns, but neither this Agreement, nor any of the rights hereunder, shall be assignable by Employee or any beneficiary or beneficiaries designated by Employee. The Bank will require any successor (whether
direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business, stock or assets of the Bank, by agreement in form and substance reasonably satisfactory to Employee, to expressly assume and agree to
perform this Agreement in its entirety. Failure to the Bank to obtain such agreement prior to the effectiveness of any such succession shall be a breach this Agreement and shall entitle the Employee to the compensation described in Sections 12(a)
and 12(d). As used in this Agreement, “Bank” shall mean First National Corporation and its wholly owned subsidiaries, and any successor to its respective business, stock or assets as aforesaid which executes and delivers the agreement
provided for in this Section 16 or which otherwise becomes bound by all the terms and provisions of this Agreement by operation of law. 
 Section 17. Resignation and Release of Claims. 
 Notwithstanding anything in this Agreement to the contrary, in
order to be eligible to receive the payments provided for under Section 12(a) as a result of termination by the Employee for Good Reason or by the Employer without Cause or payments provided for under Section 12(d) as a result of a
termination by the Employee during the Window Period after a Change of Control Employee must on his own behalf and on behalf of his estate, heirs and representatives, execute a release in form and substance reasonably satisfactory to the Bank,
releasing the Bank and its respective officers, Directors, employees, agents, representatives, shareholders, successors and assigns from any and all claims related to Employee’s employment with the Bank or the termination of employment.

 Section 18. Governing Law. 
 This Employment Agreement shall be subject to and construed in accordance with the laws of Virginia. 
  

 11 

 Section 19. Invalid Provisions. 
 The invalidity or unenforceability of any particular provision of this Employment Agreement shall not affect the validity or enforceability of any other
provisions hereof, and this Employment Agreement shall be construed in all respects as if such invalid or unenforceable provisions were omitted. 
 Section 20. Notices. 
 Any and all notices, designations, consents, offers, acceptance or any other
communications provided for herein shall be given in writing and shall be deemed properly delivered if delivered in person or by registered or certified mail, return receipt requested, addressed as follows: if to the Bank, to its President at the
headquarters office of the Bank; if to the Employee, to his last known address on record at the Bank. 
 Section 21. Entire
Agreement. 
 (a) This Employment Agreement constitutes the entire agreement among the parties with respect to the subject matter
hereof and supersedes any and all other agreements, either oral or in writing, among the parties. 
 (b) This Employment Agreement may be
executed in one or more counterparts, each of which shall be considered an original. 
 Section 22. Amendment and Waiver. 

 This Employment Agreement may not be amended except by an instrument in writing signed by or on behalf of each of the parties hereto. No
waiver of any provision of this Employment Agreement shall be valid unless in writing and signed by the party to be charged. 
 Section 23. Case and Gender. 
 Wherever required by the context of this Employment Agreement, the singular or
plural case and the masculine, feminine and neuter genders shall be interchangeable. 
 Section 24. Captions. 

The captions used in this Employment Agreement are intended for descriptive and reference purposes only and are not intended to affect the meaning of
any Section hereunder. 
 Section 25. Code Section 409A. 
 This Employment Agreement is intended to satisfy the requirements of Code Section 409A, the 409A Regulations, and other guidance, including
transition rules, issued thereunder. Each provision and term of this Employment Agreement should be interpreted accordingly, but if any provision or term would be prohibited by or inconsistent with Code Section 409A, the 409A Regulations, or

  

 12 

 
such other guidance, the parties agree that such provision or term may be amended to comply with or qualify for an exemption from Code Section 409A, the
409A Regulations, and such other guidance, in a manner determined by independent counsel selected by the Bank and reasonably acceptable to the Employee. 
  

 13 

 IN WITNESS WHEREOF, the Bank has caused this amended and restated Employment Agreement to be executed by
its duly authorized officer and Employee has executed this amended and restated Employment Agreement on the dates specified below. 
  

							
	EMPLOYEE	 		 	FIRST NATIONAL CORPORATION
				
	  
	 		 	By:	 	  

	Marshall J. Beverley, Jr.	 		 		 	Harry S. Smith
		 		 		 	President and Chief Executive Officer
			
	  
	 		 	  

	Date	 		 	Date

  

 14

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