Document:

Exhibit 10.1

EXECUTIVE EMPLOYMENT AGREEMENT

 

This
EXECUTIVE EMPLOYMENT AGREEMENT (“Agreement”) is effective as of the 6th day
of  March 2006, by and between CARDINAL
FINANCIAL CORPORATION (“Cardinal”) and Kendal E. Carson (“you” and all similar
references) (collectively, the “parties”).

INTRODUCTION

 

WHEREAS,
Cardinal has retained you to provide services in an executive capacity; and

WHEREAS,
the parties desire to memorialize the terms and conditions of your continuing
employment.

NOW
THEREFORE, in consideration of the promises and obligations by and between the
parties under this Agreement, and other valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:

TERMS

 

1.              Position, Title,
Compensation and Benefits.

 

a.              During your employment, Cardinal agrees to employ you
in as a Senior Executive Officer in the position of President, Cardinal
Financial Corporation and Senior Executive Vice President, Cardinal Bank,
reporting to the Chairman and CEO of Cardinal Financial Corporation and you
agree to accept such employment, devoting substantially all of your business
time, effort and attention to the business of Cardinal, and performing such
duties as are normally associated with your position.

 

b.              Your initial base salary will be at the annualized
rate set forth in your offer letter, less required and authorized withholding
and deductions, payable in installments in accordance with Cardinal’s normal
payroll practices. You will be eligible for an annual merit increase,
performance bonus, and stock option grants on the same basis as other similarly
situated Cardinal Executive Officers and subject to the terms of any applicable
compensation, bonus and stock plans.

 

c.               You will be eligible to participate on the same basis
as similarly situated Executive Officers in the Company’s benefit plans,
including its 401(k) Plan and medical benefit plans in effect from time to time
during your employment.  All matters of
eligibility for coverage or benefits under any benefit plan will be determined
in accordance with the provisions of such plan. 
Cardinal may change, alter, or terminate any benefit plan in its sole
discretion. Your employment will also be subject to Cardinal’s personnel
policies and procedures as they may be interpreted, adopted, revised or deleted
from time to time in the Company’s sole discretion.

 

 

2.              Contract Term. 
The term of this Agreement shall commence on March 6, 2006, and shall
continue from that date for three (3) years unless terminated prior thereto by
either Cardinal or you as provided in Section 4.  If the parties do not wish to renew this
Agreement when it expires at the end of the initial or any renewal term hereof
as hereinafter provided or if either of the parties wishes to renew this Agreement
on different terms than those contained herein, Cardinal or you shall give
written notice of such intent to the other party at least six (6) months prior
to the expiration date. In the absence of such notice, this Agreement shall be
renewed on the same terms and conditions contained herein for successive one
year terms up until March 6, 2011, when, absent express agreement by the
parties, this Agreement shall terminate. The parties expressly agree that
designation of a term and renewal provisions in this Agreement does not in any
way limit the right of the parties to terminate this Agreement at any time as
hereinafter provided. References herein to the term of this Agreement shall
refer both to the initial term and any successive term as the context requires.

 

 

 

3.              Prohibition on Competition.

 

a.              Covenant not to Perform
Competing Services.  During the term of this
Agreement and during any period during which you remain employed following the
expiration of this Agreement, and for any period during which you receive pay
from Cardinal, you shall not render or perform competing banking and/or
financial services within twenty-five (25) miles from your office or Cardinal’s
corporate headquarters.  This provision
shall not be construed to prevent you from obtaining employment in the banking
and/or financial services industries provided your new endeavor does not
violate the above-stated prohibition.

 

b.              Covenant Not to Solicit
Clients or Prospective Clients.  During the
term of this Agreement and during any period during which you remain employed
following the expiration of this Agreement and for a period of six (6) months
from the date you are terminated for Cause or your Voluntary Termination, you
agree not to contact directly or indirectly, or to assist another to contact,
any Client or Prospective Client of Cardinal with whom you have had any contact
on behalf of Cardinal to offer to perform or to perform or render banking
and/or financial services.  This
provision shall not be construed to prevent you from contacting clients of
Cardinal with whom you have not had any contact during the term of this
Agreement. For the purpose of this Agreement, “Client” means any entity for
which Cardinal has performed banking and/or financial services within the
twelve months from your termination date. 
“Prospective Client” means any entity that is not a Client but with
respect to whom, within six (6) months from your termination date, you
conducted, prepared, submitted (or assisted or supervised such conduct) any
client development work product or marketing efforts on behalf of Cardinal.

 

c.               Restriction on the
Solicitation of Cardinal’s Employees.  During the
term of this Agreement and during any period during which you remain employed
following the expiration of this Agreement, and for a period of six (6) months
from the date you are terminated for Cause or your Voluntary Termination, you
agree not to attempt to induce any Cardinal employee to terminate his or her
employment, or to seek or accept any employment with any other business entity
that performs banking and/or financial services.

 

d.              Enforcement of Covenants.

 

i.               You understand that damages Cardinal will
suffer as a result of your breach of any provision of Section 3 of this
Agreement are impossible to reasonably calculate and may irreparably harm
Cardinal.  Nothing in this Agreement
shall be construed to prevent Cardinal from seeking any form of injunctive
relief to enforce any provision of this Agreement.

 

ii.           In the event that a court finds Section 3
of this Agreement, or any of its restrictions, to be ambiguous, unenforceable,
or invalid, you and Cardinal agree that the court shall read the Agreement as a
whole and interpret the restriction(s) at issue to be enforceable and valid to
the maximum extent allowed by law.

 

iii.  If the Court declines to enforce this
Agreement in the manner provided in subparagraph 3(d)(ii), you and Cardinal
agree that this Agreement will be automatically modified to provide Cardinal
with the maximum protection of its business interests allowed by law and you
agree to be bound by this Agreement as modified.

 

iv.   If any provision of this Section 3 is
declared to be ambiguous, unenforceable or invalid, the remainder of this
Section 3 shall remain in full force and effect, and shall be read as if the
ambiguous, unenforceable or invalid provision was not contained in the
Agreement.

 

 

 

4.              Termination of Employment
Relationship.  Your employment relationship with Cardinal
may be terminated by either party subject to the notice provision addressed
below.

 

a.              Cardinal may terminate your employment for Cause at
any time effective immediately upon written notice.  In the event that Cardinal terminates your
employment for Cause, you will be entitled to earned and unpaid base salary and
payment for any earned and unused vacation days through the last date of your
employment.

 

For the purpose of this Agreement, “Cause” means any
of the following: (i) you engage in embezzlement, misappropriation of corporate
funds or other material acts of dishonesty; (ii) your commission or conviction
of any felony or entry of a plea of guilty or nolo contendere to any felony;
(iii) your material failure to adhere to Cardinal’s corporate codes, policies
or procedures; (iv) your insubordination or any act of gross misconduct; (v)
your material breach of your obligations to Cardinal pursuant to this
Agreement; or (v) revocation by any applicable regulatory authority of the
necessary approvals for you to serve as an Executive with Cardinal.

 

b.              Cardinal may terminate this Agreement for any reason
with thirty (30) days prior notice, pursuant to Section 10 below, to the other
party.

 

i.                     In the event your employment is
terminated by Cardinal pursuant to this Section 4.b, then provided that you
execute a general release in favor of Cardinal, in a form acceptable to
Cardinal (the “Release”),
and subject to Section 4.b.(ii) (the date that the Release becomes effective
and may no longer be revoked by you is referred to as the “Release
Date”), then: (i) Cardinal shall pay to you an amount equal to
your Base Salary for a period of twelve months (12) months from the Release
Date if the termination occurs during the first three years of the contract or
six (6) months from the Release Date if the termination occurs thereafter (such
applicable period is referred to as the “Severance Period”),
less applicable withholdings and deductions, on Cardinal’s regular payroll
dates; and (ii) if you are participating in Cardinal’s group health insurance
plans on the effective date of termination, and you timely elect and remain
eligible for continued coverage under COBRA, or, if applicable, state insurance
laws, Cardinal shall pay that portion of your COBRA premiums that Cardinal was
paying prior to the effective date of termination for the Severance Period or
for the continuation period for which you are eligible, whichever is shorter.
Cardinal’s COBRA premium payment obligation will end immediately if you obtain
health care insurance from any other source during the Severance Period.

 

ii.                 You shall not receive any of the benefits
pursuant to Section 4.b.(i) unless you execute the Release within the
consideration period specified therein and until the Release becomes effective
and can no longer be revoked by you under its terms.  Your ability to receive benefits pursuant to
Section 4.b(i) is further conditioned upon your: returning all Cardinal
property; complying with your post termination obligations under this Agreement; and complying
with the Release including without limitation any non-disparagement and
confidentiality provisions contained therein.

 

iii.             The benefits provided to you pursuant to
this Section 4.b are in lieu of, and not in addition to, any benefits to which
you may otherwise be entitled under any Cardinal severance plan, policy or
program.

 

c.               You may Voluntarily Terminate your employment with
Cardinal upon thirty (30) days prior written notice directed to Cardinal’s
Chairman and Chief Executive Officer (“CEO”). 
The Chairman and CEO, in his sole capacity may waive this notice
requirement.

 

d.              In the event of your death, your employment will
terminate as of the date of death. If your employment is terminated by reason
of your death, then Cardinal shall pay your accrued salary through the date of
termination and thereafter have no further obligation to pay compensation to
you. The entitlement of any of your beneficiaries to benefits under any
Cardinal benefit plan shall be determined in accordance with applicable law and
the provisions of such plan.

 

 

 

e.               Subject to applicable state and federal law, Cardinal
shall at all times have the right, upon written notice to you, to terminate
this Agreement based on your Disability (as defined below).  Termination by Cardinal of your employment
based on “Disability” shall mean termination because you are unable due to a
physical or mental condition to perform the essential functions of your
position with or without reasonable accommodation for six (6) months in the
aggregate during any twelve (12) month period or based on the written
certification by two licensed physicians of the likely continuation of such
condition for such period.  This
definition shall be interpreted and applied consistent with the Americans with
Disabilities Act, the Family and Medical Leave Act, and other applicable law.
In the event your employment is terminated based on your Disability, Cardinal
shall pay your accrued salary through the date of termination and thereafter
have no further obligation to pay compensation to you. Your entitlement to
benefits under any Cardinal benefit plan shall be determined in accordance with
applicable law and the provisions of such plan.

 

f.                Regardless of the basis of your termination of
employment, you agree to provide all assistance requested by Cardinal in
transitioning your duties, responsibilities client and other Cardinal
relationships to other Cardinal personnel, both during your employment and
after your termination or resignation.

 

5.              Change in Control. 
Notwithstanding the terms and conditions set forth in Section 4 of this
Agreement, in the event of a Change in Control (as defined below) Cardinal
agrees on behalf of itself and any successor to continue your employment
pursuant to this Agreement for a period of eighteen (18) months following the
Change in Control and to enter into an agreement with you within the eighteen
month period to continue your employment thereafter. In the event Cardinal or
any successor to Cardinal fails to continue your employment for the full
eighteen month period, then, in lieu of the benefits, if any, to which you
would otherwise be entitled under Section 5, provided you execute a general
release in favor of Cardinal, in a form acceptable to Cardinal: (i) within
thirty (30) days of the effective date of the release, Cardinal shall pay you
an amount equal to your base salary for the remainder of the eighteen (18)
months period plus an amount equal to your base salary for a period of eighteen
months, less required and authorized withholdings and deductions, on Cardinal’s
regular payroll dates, and (ii) if you are participating in Cardinal’s group
health insurance plans on the effective date of termination, and you timely
elect and remain eligible for continued coverage under COBRA, or, if
applicable, state insurance laws, Cardinal shall pay that portion of your COBRA
premiums that Cardinal was paying prior to the effective date of termination
for eighteen months or for the continuation period for which you are eligible,
whichever is shorter. Cardinal’s COBRA premium payment obligation will end
immediately if you obtain health care insurance from any other source while you
are receiving COBRA payments. In the event Cardinal continues your employment
for the full eighteen (18) month period but you and Cardinal fail to reach an
agreement for your continued employment thereafter, then, in lieu of the
benefits, if any, to which you would otherwise be entitled under Section 5,
provided you execute a general release in favor of Cardinal, in a form
acceptable to Cardinal, then within thirty (30) days of the effective date of the
release, Cardinal shall make eighteen equal monthly payments to you in an
amount equal to your base salary for eighteen (18) months.  

 

a.              For the purpose of this Agreement, “Change in Control”
means a merger or consolidation in which (i) Cardinal is a constituent party,
or (ii) a Company Subsidiary is a constituent party and Cardinal issues shares
of its capital stock pursuant to such merger or consolidation, except any such
merger or consolidation involving Cardinal or a Company Subsidiary in which the
holders of capital stock of Cardinal immediately prior to such merger or
consolidation continue to hold immediately following such merger or
consolidation more than fifty (50) percent by voting power of the capital stock
of or ownership interest in (A) the surviving or resulting entity or (B) if the
surviving or resulting entity is a wholly owned subsidiary of another entity
immediately following such merger or consolidation, the parent entity of such
surviving or resulting entity.   “Change
in Control” may also mean the sale, in a single transaction or series of
related transactions, (i) by Cardinal of all or substantially all the assets of
Cardinal (except where such sale is to a wholly owned subsidiary of the
Company), or (ii) by the stockholders of Cardinal of more than fifty (50)
percent by voting power of the then-outstanding capital stock of Cardinal.  Finally, a “Change of Control” may constitute
the occurrence of any agreement, happening or device, which has substantially
the same effect on the control of Cardinal as any of the foregoing.

 

 

 

b.              In the event that the aggregate of all payments or
benefits made or provided to, or that may be made or provided to, you under
this Agreement and under all other plans, programs and arrangements of Cardinal
(the “Aggregate Payment”)
would (i) constitute a “parachute payment” within the meaning of Section 280G
of the Code, and (ii) but for this sentence, be subject to the excise tax
imposed by Section 4999 of the Code (the “Excise Tax”), then such payments and benefits
shall be equal to the Reduced Amount. The “Reduced Amount” shall be the largest portion
of the payments and benefits that would result in no portion of the payments
and benefits being subject to the Excise Tax. 
Cardinal shall determine the procedures and manner of making the
calculation required above, and the method to order the reduction of Payments (i.e.,
whether equity or cash payments get reduced first). You and Cardinal shall
cooperate with each other in connection with any proceeding or claim relating
to the existence or amount of liability for Excise Tax.

 

c.               For the purpose of this Agreement, “Effective Date”
means the close of business on the date on which a “Change of Control” occurs.

6.              Assignment and Survival.  
The rights and obligations of Cardinal under this Agreement shall inure
to the benefit of, and shall be binding upon, the successors and assigns of
Cardinal.  Your rights and obligations
are personal, and may not be assigned or delegated without the Company’s proper
written consent.

 

7.              Severability. 
If any provision of this Agreement is held invalid or unenforceable for
any reason, the invalidity shall not nullify the validity of the remaining
provisions of this Agreement.  If any
provision of this Agreement is determined by a court or arbitration tribunal to
be overly broad in duration, geographical coverage or scope, or unenforceable
for any other reason, such provision will be narrowed so that it will be
enforced as much as permitted by law.

8.              Choice of Law. 
This Agreement shall be governed by the laws of the Commonwealth of
Virginia.  You and Cardinal consent to
the jurisdiction and venue of any state or federal court in the Commonwealth of
Virginia and agree that any permitted lawsuit may be brought to such courts or
other court of competent jurisdiction. 
Each party hereby waives, releases and agrees not to assert, and agrees
to cause its affiliates to waive, release and not assert, any rights such party
or its affiliates may have under any foreign law or regulation that would be
inconsistent with the terms of this Agreement as governed by Virginia law.

9.              Waiver. 
Any party’s waiver of any other party’s breach of any provision of this
Agreement shall not waive any other right or any future breaches of the same or
any other provision.

10.       Notices.  Any notices required hereunder to be in
writing shall be deemed effectively given: (a) upon personal delivery to the
party to be notified, (b) when sent by electronic mail, telex or confirmed
facsimile if sent during normal business hours of the recipient, and if not,
then on the next business day, (c) five (5) days after having been sent by
registered or certified mail, return receipt requested, postage prepaid, or (d)
one (1) day after deposit with a nationally recognized overnight courier,
specifying next day delivery, with written verification of receipt.  All communications shall be sent to Cardinal
at its primary office location and to you at your address as listed on Cardinal
payroll, or at such other address as Cardinal or you may designate by ten (10)
days advance written notice to the other.

 

11.       Entire Agreement. 
This Agreement is the entire agreement between you and Cardinal
regarding these matters and supersedes any verbal and written agreements on
such matters.  This Agreement may be
modified only by written agreement signed by you and the CEO or his or her
express designee.  All Section headings
are for convenience only and do not modify or restrict any of this Agreement’s
terms.

 

 

 

12.       Counterparts.  For convenience
of the parties, this Agreement may be executed in one or more counterparts,
each of which shall be deemed an original for all purposes.

 

 

The parties state that they have read, understood
and agree to be bound by this Agreement and that they have had the opportunity
to seek the advice of legal counsel before signing it and have either sought
such counsel or have voluntarily decided not to do so:

 

 

	
  CARDINAL FINANCIAL CORPORATION

  	
   

  	
  EMPLOYEE

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Bernard H. Clineburg

  	
   

  	
  /s/ Kendal E. Carson

  
	
   

  	
  Bernard H. Clineburg

  	
   

  	
  (Signature)

  
	
   

  	
   

  	
   

  	
   

  
	
  Its:

  	
  Chairman and CEO

  	
   

  	
  Kendal E. Carson

  
	
   

  	
  (Title)

  	
   

  	
   

  
						

 

11/7/2007Exhibit 10.2

Cardinal Financial
Corporation

Supplemental Executive
Retirement Plan

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CARDINAL FINANCIAL CORPORATION

 

SUPPLEMENTAL EXECUTIVE RETIREMENT
PLAN

 

 

 

 

 

 

 

 

 

 

 

 

 

 

i

 

 

 

TABLE OF
CONTENTS

(continued)

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  ARTICLE I

  	
  DEFINITIONS

  	
  2

  
	
  1.01

  	
  Affiliate

  	
  2

  
	
  1.02

  	
  Beneficiary

  	
  2

  
	
  1.03

  	
  Board

  	
  2

  
	
  1.04

  	
  Cause

  	
  2

  
	
  1.05

  	
  Code

  	
  2

  
	
  1.06

  	
  Committee

  	
  2

  
	
  1.07

  	
  Corporation

  	
  3

  
	
  1.08

  	
  Effective Date

  	
  3

  
	
  1.09

  	
  ERISA

  	
  3

  
	
  1.10

  	
  Participant

  	
  3

  
	
  1.11

  	
  Plan

  	
  3

  
	
  1.12

  	
  Retirement

  	
  3

  
	
  1.13

  	
  Retirement Benefit

  	
  3

  
	
  1.14

  	
  Separation From Service

  	
  3

  
	
  1.15

  	
  Year of Service

  	
  3

  
	
  ARTICLE II

  	
  ELIGIBILITY & PARTICIPATION

  	
  4

  
	
  ARTICLE III

  	
  BENEFITS

  	
  4

  
	
  3.01

  	
  Retirement Benefit

  	
  4

  
	
  3.02

  	
  Pre- Retirement Separation

  	
  4

  
	
  3.03

  	
  Death

  	
  5

  
	
  3.04

  	
  Termination For Cause

  	
  5

  
	
  3.05

  	
  No Duplication of Benefits

  	
  5

  
	
  ARTICLE IV

  	
  PLAN UNFUNDED

  	
  6

  
	
  ARTICLE V

  	
  NO GUARANTEE OF EMPLOYMENT

  	
  6

  
	
  ARTICLE VI

  	
  OTHER BENEFITS AND AGREEMENTS

  	
  6

  
	
  ARTICLE VII

  	
  RESTRICTIONS ON TRANSFER OF BENEFITS

  	
  7

  
	
  ARTICLE VIII

  	
  ADMINISTRATION OF THE PLAN

  	
  7

  
	
  8.01

  	
  The Committee

  	
  7

  

 

 

ii

 

 

	
  8.02

  	
  Indemnification of the Committee

  	
  7

  
	
  8.03

  	
  Powers of the Committee

  	
  7

  
	
  8.04

  	
  Information

  	
  8

  
	
  ARTICLE IX

  	
  CLAIMS PROCEDURE

  	
  8

  
	
  ARTICLE X

  	
  MISCELLANEOUS

  	
  8

  
	
  10.01

  	
  Binding Nature

  	
  8

  
	
  10.02

  	
  Governing Law

  	
  8

  
	
  10.03

  	
  Construction

  	
  8

  
	
  10.04

  	
  Fiduciary Discretion

  	
  8

  
	
  ARTICLE XI

  	
  ADOPTION

  	
  9

  

 

 

 

 

iii

 

Cardinal Financial
Corporation

Supplemental Executive
Retirement Plan

 

 

INTRODUCTION

                The Board of
Directors of Cardinal Financial Corporation (the “Board”) adopted the
Supplemental Executive Retirement Plan for the purpose of supplementing the
retirement benefits payable under the Corporation’s tax-qualified plans for
certain key employees of the Corporation.

 

The Plan is intended to be unfunded and maintained
primarily for the purpose of providing deferred compensation for a “select
group of management or highly compensated employees” (as such phrase is used in
the Employee Retirement Income Security Act of 1974).  The Plan must be administered and construed
in a manner that is consistent with that intent.

 

The Plan is intended to satisfy the requirements of
Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and
applicable Treasury Regulations issued thereunder.  Each provision and term of the Plan should be
interpreted accordingly, but if any provision or term would be prohibited by or
inconsistent with Code Section 409A, then such provision or term should be
deemed to be reformed to comply with Code Section 409A.

 

 

 

1

 

ARTICLE I

DEFINITIONS

The following phrases or terms have the indicated
meanings:

 

1.01        Affiliate

Affiliate means each trade or business (whether or not incorporated)
which together with the Corporation is treated as a controlled group of
corporations.

1.02        Beneficiary  

                Beneficiary means the person,
persons, entity, entities or the estate of the Participant entitled to receive
benefits under the Plan in accordance with a properly completed beneficiary
designation form.  If the Participant
fails to complete a beneficiary designation form, or the form is incomplete,
Beneficiary means the Participant’s estate. 
The Participant may amend or change his Beneficiary designation in
accordance with procedures established by the Committee.

1.03        Board

                Board means the Board of
Directors of Cardinal Financial Corporation.

1.04        Cause

Cause shall mean:

a)             Willful
malfeasance by the Employee in connection with the performance of his duties
for the Corporation that could, in good faith judgment of the Corporation, (A)
subject the Corporation to criminal penalties or (B) result in the incarceration
of any officer, director or employee of the Corporation

b)             The Participant’s
conviction of felony or other crime which, in the good faith judgment of the
Corporation, could have a material adverse effect on the business of the
Corporation.

c)              The
misappropriation by the Participant of Corporate funds for personal use, or

d)             The continued
failure or refusal by the Participant to perform his duties after reasonable
prior notice from the Corporation to the Participant.

1.05        Code

                Code means the Internal Revenue
Code of 1986, as amended.

1.06        Committee

                Committee means the Compensation
Committee of the Board.

 

 

 

2

 

 

 

1.07        Corporation

                Corporation means Cardinal
Financial Corporation.

1.08        Effective Date

                The Effective Date of this Plan
is June 5, 2007.

1.09        ERISA

                ERISA means the Employee
Retirement Income Security Act of 1974, as amended.

1.10        Participant

                Participant means Kendal E.
Carson, the Corporation’s President.

1.11        Plan

                Plan means the Cardinal
Financial Corporation Supplemental Executive Retirement Plan.

1.12        Retirement

Retirement means the
Participant’s Separation from Service from the Corporation and its Affiliates
at age 65.

1.13        Retirement Benefit

Retirement Benefit means the
monthly benefit payable to the Participant upon his Retirement in accordance
with Section 3.01 below.

1.14        Separation From
Service

Separation From Service (and
variations thereof) means any termination of the Participant’s employment or
expiration of a services contract between the Participant and the Corporation
or its Affiliates that constitutes a “separation from service” within the
meaning of Code Section 409A and applicable Treasury Regulations
thereunder.  The Participant shall not be
deemed to have Separated from Service during an authorized leave of absence (i)
that does not extend beyond six months or (ii) following which the Participant
has a contractual or statutory right to resume employment.

1.15        Year of Service

Year of Service means a twelve-consecutive month period of employment
with the Corporation or an Affiliate commencing on March 6, 2006, and each
anniversary thereof.  No partial Years of
Service shall be credited under the Plan. 
Any service with the Company or its Affiliates prior to March 6, 2006 is
not taken into account for purposes of the Plan.

 

 

3

 

 

 

 

ARTICLE II

ELIGIBILITY & PARTICIPATION

                The Participant was designated by the Committee to
commence participation in the Plan as of June 5, 2007.  The Participant shall continue to participate
in the Plan until no longer entitled to any further benefits under the terms of
the Plan.

 

ARTICLE III 

BENEFITS

3.01        Retirement Benefit

                Upon Retirement at age 65, the
Participant shall be entitled to a monthly retirement benefit equal to $10,000
per month payable for 120 months (the “Retirement Benefit”).  Payment of the Retirement Benefit shall be
made to the Participant (or to the Participant’s Beneficiary, in the case of
his post-Retirement death) commencing on the date which is six months after the
date of the Participant’s Retirement at age 65 (or the date of his
post-Retirement death, if earlier).

3.02        Pre-Retirement
Separation Benefit

If the Participant has a
Separation from Service before reaching Retirement at age 65, then the
Participant (or the Participant’s Beneficiary, in the case of his
post-separation death) shall be entitled to a percentage of the Retirement
Benefit described in Section 3.01 based on his Years of Service after March 6,
2006, determined in accordance with the following schedule, commencing on the
date which is six months after the date of the Participant’s Retirement at age
65  (or on the date of his
post-separation death, if earlier).

	
  Post-03/06/06 Years of Service

  	
   

  	
  Percentage of Retirement
  Benefit

  
	
   

  	
   

  	
   

  
	
  1
  but less than 2

  	
   

  	
  10.00%

  
	
  2
  but less than 3

  	
   

  	
  20.00%

  
	
  3
  but less than 4

  	
   

  	
  30.00%

  
	
  4
  but less than 5

  	
   

  	
  40.00%

  
	
  5
  but less than 6

  	
   

  	
  50.00%

  
	
  6
  but less than 7

  	
   

  	
  60.00%

  
	
  7
  but less than 8

  	
   

  	
  70.00%

  
	
  8
  but less than 9

  	
   

  	
  80.00%

  
	
  9
  but less than 10

  	
   

  	
  90.00%

  
	
  10
  or more

  	
   

  	
  100%

  

 

 

 

4

 

 

 

3.03        Death

(a)           If
the Participant Separates from Service with the Corporation and its Affiliates
as a result of his death, then his Beneficiary shall receive the unreduced Retirement
Benefit described in Section 3.01 commencing on the first day of the first
month following the month in which the Participant has died.

(b)           If
the Participant dies after payment of his Retirement Benefit has commenced,
then the Participant’s Beneficiary shall be entitled to any payments remaining
in the 120-month period.  Such benefits
shall be paid over the remaining months in the 120-month period.

3.04        Termination For
Cause

Notwithstanding anything in
this Article III to the contrary, if the Participant’s employment with the
Corporation and its Affiliates is terminated for Cause, he shall immediately
cease to be a Participant under the Plan and shall forfeit all rights and
benefits (vested or unvested) under the Plan.

3.05        No Duplication of
Benefits

Notwithstanding anything in
this Article III to the contrary, a Participant shall be entitled to commence
payment of the benefits described herein on no more than one of the events
described in Sections 3.01 through 3.04 above. 
Commencement of benefit payments under any one of Sections 3.01 through
3.04 precludes commencement of benefit payments under any other section of the
Plan.

 

 

5

 

ARTICLE IV 

PLAN UNFUNDED

                The Corporation and any Affiliate participating in
the Plan have only a contractual obligation to pay the benefits described in
Article III.  All benefits are to be
satisfied solely out of the general corporate assets of the Corporation or the
appropriate Affiliate which shall remain subject to the claims of its
creditors.  No assets of the Corporation
or a participating Affiliate will be segregated or committed to the
satisfaction of its obligations to the Participant or any Beneficiary under
this Plan.  If the Corporation, in its
sole discretion, elects to purchase life insurance on the life of the
Participant in connection with the Plan, the Participant must submit to a
physical examination, if required by the insurer, and otherwise cooperate in
the issuance of such policy or his rights under the Plan will be forfeited

 

ARTICLE
V 

NO GUARANTEE OF EMPLOYMENT

The Plan does not in any way limit the right of the Corporation or an
Affiliate at any time and for any reason to terminate the Participant’s
employment.  In no event shall the Plan,
by its terms or by implication, constitute an employment contract of any nature
whatsoever between the Corporation or an Affiliate and the Participant.

 

ARTICLE
VI 

OTHER BENEFITS AND AGREEMENTS

                The benefits
provided for a Participant and his Beneficiary under the Plan are in addition
to any other benefits available to such Participant under any other plan or
program of the Corporation for its employees, and, except as may otherwise be
expressly provided for, the Plan shall supplement and shall not supersede,
modify or amend any other plan or program of the Corporation in which a
Participant is participating.

 

 

6

 

 

ARTICLE VII

RESTRICTIONS ON TRANSFER OF BENEFITS

                No right or benefit under the Plan shall be subject
to anticipation, alienation, sale, assignment, pledge, encumbrance or charge,
and any attempt to do so shall be void. 
No right or benefit hereunder shall in any manner be liable for or
subject to the debts, contracts, liabilities, or torts of the person entitled
to such benefit.  If the Participant or
any Beneficiary under the Plan should become bankrupt or attempt to anticipate,
alienate, sell, assign, pledge, encumber or charge any right to a benefit
hereunder, then such right or benefit, in the discretion of the Committee,
shall cease and terminate, and, in such event, the committee may hold or apply
the same or any part thereof for the benefit of the Participant or such
Beneficiary, his or her spouse, children, or other dependents, or any of them,
in such manner and in such portion as the Committee may deem proper.

 

ARTICLE VIII 

ADMINISTRATION OF THE PLAN

8.01        The Committee  

                The Plan shall be administered
by the Committee.  Subject to the
provisions of the Plan, the Committee may adopt such rules and regulations as
may be necessary to carry out the purposes hereof.  The Committee’s interpretation and
construction of any provision of the Plan shall be final and conclusive.  The Committee in its sole discretion may
delegate ministerial duties with respect to the administration of the Plan to
employees of the Corporation or to third parties.

8.02        Indemnification of
the Committee

                The Corporation shall indemnify
and save harmless each member of the Committee against any and all expenses and
liabilities arising out of membership on the Committee related to any
shareholder or similar action involving the Plan, excepting only expenses and
liabilities arising out of a member’s own willful misconduct.  Expenses against which a member of the
Committee shall be indemnified hereunder shall include without limitation, the
amount of any settlement or judgment, costs, counsel fees, and related charges
reasonably incurred in connection with a claim asserted, or a proceeding
brought or settlement thereof.  The
foregoing right of indemnification shall be in addition to any other rights to
which any such member may be entitled.

8.03        Powers of the
Committee

                In addition to the powers
hereinabove specified, the Committee shall have the power to compute and
certify the amount and kind of benefits from time to time payable to
Participants and their Beneficiaries under the Plan, to authorize all
disbursements for such purposes, and to determine whether a Participant is
entitled to a benefit under Article III.

 

 

7

 

 

8.04        Information

                To enable the Committee to
perform its functions, the Corporation shall supply full and timely information
to the Committee on all matters relating to the compensation of all
Participants, their retirement, death or other cause for termination of
employment, and such other pertinent facts as the Committee may require.

 

ARTICLE
IX 

CLAIMS PROCEDURE

All claims for benefits
shall be in writing in a form satisfactory to the Committee.  If the Committee wholly or partially denies
Participant’s or Beneficiaries claim for benefits, the Board shall review
Participant’s or Beneficiary’s claim in accordance with applicable procedures
described in the Employee Retirement Income Security Act of 1974.

 

ARTICLE
X 

MISCELLANEOUS

10.01      Binding Nature

                The Plan shall be binding upon
the Corporation, any participating Affiliates and its successors and assigns;
and upon a Participant, his or her Beneficiary, and either of their assigns,
heirs, executors and administrators.

10.02      Governing Law

                To the extent not preempted by
federal law, the Plan shall be governed and construed under the laws of the
Commonwealth of Virginia (including its choice of law rules, except to the
extent those rules would require the application of the law of a state other
than Virginia) as in effect at the time of their adoption and execution,
respectively.

10.03      Construction

                Masculine pronouns wherever used
shall include feminine pronouns and the use of the singular shall include the
plural.

10.04      Fiduciary Discretion

                In discharging the duties
assigned to it under the Plan, the Committee shall have the discretion to
interpret the Plan; adopt, amend and rescind rules and regulations pertaining
to its duties under the Plan; and to make all other determinations necessary or
advisable for the discharge of its duties under the Plan.  The Committee’s discretionary authority shall
be absolute and exclusive if exercised in a uniform and nondiscriminatory manner
with respect to similarly

 

 

8

 

situated
individuals.  The express grant in the
Plan of any specific power to the Committee with respect to any duty assigned
to it under the Plan must not be construed as limiting any power of authority
of the Committee to discharge its duties. 
The Committee’s decision is final and conclusive unless it is
established that the Committee’s decision constituted an abuse of its
discretion.  Benefits under the Plan will
be paid only if the Committee decides that the applicant is entitled thereto.

 

ARTICLE XI 

ADOPTION

                The Corporation
has adopted this Plan pursuant action taken by the Board.

 

                As evidence of its
adoption of the Plan, Cardinal Financial Corporation has caused this document
to be signed by its Chairman and CEO, this 7th day of November, 2007

 

 

	
   

  	
  CARDINAL FINANCIAL CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Bernard H. Clineburg

  
	
   

  	
   

  	
  Bernard H. Clineburg, Chairman and CEO

  

 

 

 

I, Kendal Carson, President of Cardinal Financial
Corporation, by my signature below indicate my agreement with and assent to the
terms of the Cardinal Financial Corporation Supplemental Executive Retirement
Plan.

 

 

	
  /s/ Kendal E. Carson

  	
   

  	
  11/7/2007

  
	
  Kendal E. Carson

  	
   

  	
  Date

  
	
  President

  	
   

  	
   

  

 

 

 

 

9

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