Document:

EXHIBIT 10.7

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SECOND AMENDED AND RESTATED CHANGE IN CONTROL AGREEMENT
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THIS SECOND AMENDED AND RESTATED AGREEMENT is entered into as of the 23rd day of December, 2021 by and between C&F FINANCIAL CORPORATION, a Virginia corporation (the “Holding Company”), CITIZENS AND FARMERS BANK, a Virginia banking corporation (the “Bank”) (collectively Holding Company and Bank shall be referred to herein as “Company”), and Larry Dillon (the “Executive”).
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RECITALS
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I.The Executive currently serves as Executive Chairman of the Holding Company and the Bank, is a key member of management of the Company and its affiliates, and his services and knowledge are valuable to the Company and its affiliates.
II.The Board and Bank Board (as defined below) have determined that it is in the best interest of the Company and its shareholders to assure that the Company and its affiliates will have the continued dedication of the Executive, notwithstanding the possibility, threat or occurrence of a Change in Control (as defined below). The Board and the Bank Board believe it is imperative to diminish the inevitable distraction of the Executive by virtue of the personal uncertainties and risks created by a pending or threatened Change in Control and to encourage the Executive’s full attention and dedication  to the Company and its  affiliates currently and in the event of any  threatened  or  pending  Change in  Control. Therefore, in order to accomplish these objectives, the Board and the Bank Board have caused the Holding Company and the Bank to enter into this Agreement.
III.This Agreement amends and restates the agreement between the Company and the Executive dated December 30, 2008.
NOW, THEREFORE, it is hereby agreed as follows:
1.  CERTAIN DEFINITIONS.
(a)  “Agreement Effective Date” means the date first set out above.
(b)  The “Agreement Term” means the period commencing on the Agreement Effective Date and ending on the earlier of (i) the Agreement Regular Termination Date or (ii) the date this Agreement terminates pursuant to Section 8. The “Agreement Regular Termination Date” means the third anniversary of the Agreement Effective Date, provided, however, that commencing on the first anniversary of the Agreement Effective Date, and on each subsequent anniversary (such date and each subsequent anniversary shall be hereinafter referred to as the “Renewal Date”), unless this Agreement is previously terminated, the Agreement Regular Termination Date shall be automatically extended for three years from the latest Renewal Date, unless at least one month prior to the latest Renewal Date, the Company shall give notice to the Executive in accordance with Section 11(c) of this Agreement that the Agreement Regular Termination Date shall not be so extended.
(c)  “Bank Board” means the Board of Directors of the Bank and “Board” means the Board of Directors of the Holding Company. 
(d)  “Cause” means:
(i)  the willful and continued failure of the Executive to substantially perform his duties with the Company or one of its affiliates (other than any such failure resulting from incapacity due to physical or mental illness), after a written demand for substantial performance is delivered to the Executive by the Board, pursuant to a vote of a majority of the “Outside Directors” (as defined below) of the Holding Company, which specifically identifies the manner in which the Outside Directors of the Board believe that the Executive has not substantially performed his duties, or
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(ii)  the willful engaging by the Executive in illegal conduct or gross misconduct which is materially and demonstrably injurious to the Company.
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For purposes of this provision, no act or failure to act, on the part of the Executive, shall be considered “willful” unless it is done, or omitted to be done, by the Executive in bad faith or without reasonable belief that the Executive’s action or omission was in the best interest of the Company. Any act, or failure to act, based upon authority given pursuant to a resolution duly adopted by the Board or based upon the advice of counsel for the Company shall be conclusively presumed to be done, or omitted to be done, by the Executive in good faith and in the best interests of the Company. The cessation of employment of the Executive shall not be deemed to be for Cause unless and until there shall have been delivered to the Executive a copy of a resolution duly adopted by the affirmative vote of not less than two-thirds of the members of the Board who are not and have never been employed by the Company or its subsidiaries (the “Outside Directors”) at a meeting of the Board called and held for such purpose (after reasonable notice is provided to the Executive in accordance with Section 11(c) of this Agreement and the Executive is given an opportunity, together with counsel, to be heard before the Board), finding that, in the good faith opinion of the Board, the Executive has engaged in the conduct described in paragraph (i) or (ii) above, and specifying the particulars thereof in detail.
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(e)  The “Change in Control Date” means the first date during the Agreement Term on which a Change in Control (as defined in Section 2) occurs. Anything in this Agreement  to the contrary notwithstanding, if a Change in Control occurs and if the Executive’s employment with the Company is terminated prior to the date on which the Change in Control occurs, and if it is reasonably demonstrated by the Executive that such termination of employment either (i) was at the request of a third party who has taken steps reasonably calculated to effect a Change in Control or (ii) otherwise arose in connection with or anticipation of a Change in Control, then for all purposes of this Agreement except for the time and form of payment of the Change in Control Benefits payable under Section 4(c) the “Change in Control Date” shall mean the date immediately prior to the date of such termination of employment.
(f)  “Coverage Period” means the period of time beginning with the Change in Control Date and ending on the earliest to occur of (i) the Executive’s death and (ii) the second anniversary of the Change in Control Date. 
 
(g)  “Disability” means the absence of the Executive from his duties with the Company on a full-time basis for six months as a result of incapacity to serve as the Executive Chairman, including substantially all duties normally considered a part thereof, due to mental or physical illness or injury which is determined to be total and permanent by a physician selected by the Company or its insurers and acceptable to the Executive or the Executive’s legal representative. If the Company determines in good faith that the Disability of the Executive has occurred, it may give to the Executive written notice in accordance with Section 11(c) of this Agreement of its intention to terminate the Executive’s employment. In such event, the Executive’s employment with the Company shall terminate effective on the 30th day after receipt of such notice by the Executive (the “Disability Effective Date”), provided that, within the 30 days after such receipt, the Executive shall not have returned to full-time performance of his duties.
(h)  “Good Reason” means any good faith determination made by the Executive (which determination shall be conclusive) that any of the following has occurred:
(i)  the occurrence, on or after the Agreement Effective Date and during the Coverage Period, of any of the following:
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(A)  the assignment to the Executive of any duties inconsistent in any material adverse respect with the Executive’s position (including status, offices, titles and reporting requirements), authority, duties or responsibilities immediately prior to the Change in Control, or any other action by the Company or its affiliates which results in a diminution in such position, authority, duties or responsibilities, excluding for this purpose an isolated, insubstantial and inadvertent action not taken in bad faith and which is remedied by the Company promptly after receipt of notice thereof given by the Executive in accordance with Section 11(c) of this Agreement;

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(B)  a reduction by the Company or its affiliates in the  Executive’s rate of annual base salary, benefits (including, without limitation, incentive or bonus pay arrangements, stock plan benefit arrangements, and retirement and welfare plan coverage) and perquisites as in effect immediately prior to the Change in Control or as the same may be increased from time to time thereafter, other than an isolated, insubstantial and inadvertent failure not occurring in bad faith and which is remedied by the Company promptly after receipt of notice thereof given by the Executive in accordance with Section 11(c) of this Agreement;
(C) the Company’s requiring the Executive to be based at any office or location more than 35 miles from the facility where the Executive is located at the time of the Change in Control or the Company’s requiring the Executive to travel on Company business to a substantially greater extent than required immediately prior to the Change in Control Date (but determined without regard to travel necessitated by reason of any anticipated Change in Control);
(D)  any purported termination by the Company or its affiliates of the Executive’s employment otherwise than as expressly permitted by this Agreement; or
(E) any failure by the Company or its affiliates to comply with and satisfy Section 10(c) of this Agreement by obtaining satisfactory agreement from any successor to assume and perform this Agreement.
(ii)  any event or condition described in paragraph (i) of this Section 1(h) which occurs on or after the Agreement Effective Date, but prior to a Change in Control, but was at the request of a third party who effectuates the Change in Control, notwithstanding that it occurred prior to the Change in Control, but such event or condition shall not be considered to actually have occurred until the Change in Control Date.
(i)  “Covered Termination” means a termination of Executive’s employment during the Coverage Period (i) by the Company for any reason other than (A) for Cause, (B) the Executive’s Disability or (C) the Executive’s death, or (ii) by the Executive for Good Reason. 
(j)  “Noncovered Termination” means a cessation of Executive’s employment which is not a Covered Termination.
2.  CHANGE IN CONTROL.  
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A “Change in Control” means a change in the ownership, a change in the effective control, or a change in the ownership of a substantial portion of the assets, in each case of the Holding Company, the Bank or one of their affiliates as provided in Section 2(a) below, consistent with and interpreted in accordance with Section 409A of the Internal Revenue Code (“Code”) and applicable regulations and guidance issued thereunder (“Code Section 409A”), and specifically defined as follows: 
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(a)General Rules.  In order to constitute a Change in Control as to the Executive, the Change in Control shall relate to: 
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(i)The corporation for whom the Executive is performing services at the time of the Change in Control; or
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(ii)The corporation that is liable for the payment of the deferred compensation (or all corporations liable for the payment if more than one corporation is liable) but only if either the deferred compensation is attributable to the performance of service by the Executive for such corporation (or corporations) or there is a bona fide business purpose for such corporation or corporations to be liable for such payment and, in either case, no significant purpose of making such corporation or corporations liable for such payment is the avoidance of Federal income tax; or
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(iii)A corporation that is a majority shareholder of a corporation identified in either paragraph (i) or (ii), or any corporation in a chain of corporations in which each corporation is a majority shareholder of another corporation in the chain, ending in a corporation identified in either paragraph (i) or (ii) above. 
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(b)Change In Ownership.  A change in the ownership of a corporation shall occur on the date that any one person, or more than one person acting as a group, acquires ownership of stock of the corporation that, together with stock held by such person or group, constitutes more than 50% of the total fair market value or total voting power of the stock of such corporation.  However, if any person, or more than one person acting as a group, is considered to own more than 50% of the total fair market value or total voting power of the stock of a corporation, then the acquisition of additional stock by the same person or persons shall not be considered to cause a change in the ownership of the corporation (or to cause a change in the effective control of the corporation). 
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(c)Change In Effective Control.  Notwithstanding the fact that a corporation has not undergone a change in ownership as described above, a change in the effective control of a corporation shall occur only on the date that either: 
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(i)Any one person or more than one person acting as a group acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) ownership of stock of the corporation possessing 30% or more of the total voting power of the stock of such corporation; or
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(ii)A majority of members of the corporation’s Board of Directors is replaced during any 12-month period by Directors whose appointment or election is not endorsed by a majority of the members of the corporation’s Board of Directors prior to the date of the appointment or election, provided that for purposes of this paragraph (ii), the term “corporation” refers solely to the relevant corporation identified above, for which no other corporation is a majority shareholder. 
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(d)Change In Ownership of Assets.  A change in the ownership of a substantial portion of the assets of a corporation shall occur on the date that any one person, or more than one person acting as a group, acquires (or has acquired during the twelve-month period ending on the date of the most recent acquisition by such person or persons) assets from the corporation that have a total gross fair market value equal to or more than 40% of the total gross fair market value of all of the assets of the corporation immediately prior to such acquisition or acquisitions.  For this purpose, “gross fair market value” shall mean the value of the assets of the corporation, or the value of the assets being disposed of, determined without regard to any liabilities associated with such assets. 
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A transfer of assets by a corporation shall not be treated as a change in the ownership of such assets if the assets are transferred to: 
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(i)A shareholder of the corporation (immediately before the asset transfer) in exchange for or with respect to its stock; or
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(ii)An entity, 50% or more of the total value or voting power of which is owned, directly or indirectly, by the corporation; or
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(iii)A person, or more than one person acting as a group, that owns, directly or indirectly, 50% or more of the total value or voting power of all the outstanding stock of the corporation; or
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(iv)An entity, at least 50% of the total value or voting power of which is owned, directly or indirectly, by a person who is a “related person” under applicable Treasury Regulations. 
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There shall be no Change in Control when there is a transfer to an entity that is controlled by the shareholders of the transferring corporation immediately after the transfer.
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3.  OBLIGATIONS OF THE EXECUTIVE TO REMAIN EMPLOYED. 
The Executive agrees that in the event any person or group attempts a Change in Control, he shall not voluntarily leave the employ of the Company without Good Reason (i) until such attempted Change in Control terminates or (ii) if a Change in Control shall occur, until the Change in Control Date. For purposes of the foregoing clause (i), Good Reason shall be determined as if a Change in Control had occurred when such attempted Change in Control became known to the Board.
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4.  OBLIGATIONS UPON THE EXECUTIVE’S TERMINATION.
(a)  Notice of Termination. Any termination of the Executive’s employment by the Company or by the Executive, other than by reason of death, shall be communicated by Notice of Termination to the other party hereto given. For purposes hereof:
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(i)  “Notice of Termination” means a written notice given in accordance with Section 11(c) of this Agreement which (A) states whether such termination is for Cause, Good Reason or Disability, (B) indicates the specific termination provision in this Agreement relied upon, if any, (C) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated, and (D) if the Date of Termination is other than the date of receipt of such notice, specifies the termination date. The failure by the Executive or the Company to set forth in the Notice of Termination any fact or circumstance which contributes to a showing of Good Reason, Cause or Disability shall not waive any right of the Executive or the Company, respectively, hereunder or preclude the Executive or the Company, respectively, from asserting such fact or circumstance in enforcing the Executive’s or the Company’s rights hereunder.
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(ii)  “Date of Termination” means (A) if the Executive’s employment is terminated by reason of Disability, the Disability Effective Date, (B) if the Executive’s employment is terminated by the Company for any reason other than Disability, the date of the Executive’s receipt of the Notice of Termination or any later date specified therein, as the case may be, and (C) if the Executive’s employment is terminated by the Executive for any reason, the date of the Company’s receipt of the Notice of Termination or any later date specified therein, as the case may be.
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(b)  Obligations of the Company in a Covered Termination. If the Executive’s employment shall cease by reason of a Covered Termination, subject to the delay provided under Section 7, if applicable, then the following shall be paid or provided (the payments and benefits described in (i), (ii) and (iii) below may hereinafter sometimes be referred to as the “Change in Control Benefit” or “Change in Control Benefits”):
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(i)  the Company shall pay or cause to be paid in cash to the Executive a lump sum within 30 days after the Date of Termination and with the lump sum payment totaling an amount equal to the product of (A) two and one-half and (B) the sum of the Executive’s (1) highest aggregate annual base salary from the Company and its affiliated companies in effect at any time during the 24 month period ending on the Change in Control Date and (2) highest aggregate annual bonuses (including any deferrals thereof) from the Company and its affiliated companies payable for the Company’s three fiscal years immediately preceding the fiscal year which includes the Change in Control Date;
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(ii)  in the event that the Executive is enrolled in any of the Health Plans on the Executive’s Date of Termination, the Executive and his enrolled dependents shall continue to receive benefits under, and will remain eligible to participate in, the Health Plans for three years from the Date of Termination, provided that, to the extent required due to any applicable nondiscrimination requirements under the Internal Revenue Code, the Company will impute income to the Executive equal to 100% of the full premiums required for such coverage during the period of coverage.  For the avoidance of doubt, the first 18 months of any such continued coverage period shall be considered COBRA coverage, and no additional period of continuation coverage will be provided after the third anniversary of Executive’s Date of Termination. If participation in any one or more of the Health Plans is not possible under the terms of the Health Plans or is not permitted by any applicable reinsurance carrier, or if any provision of law would create an adverse tax effect for the Executive or the Company due to such participation, the Company shall instead provide the Executive with a monthly payment equal to 100% of the full premiums for the coverage in place for the 

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Executive and, if applicable, his dependents, immediately prior to the date that coverage can no longer be provided under the Health Plans.  To the extent the monthly cash payment amount is payable for more than one year, such monthly amount shall increase by 5% at the end of each 12-month period that it is payable. If the Executive becomes reemployed with another employer and elects coverage under another employer-provided plan, the benefit under the Health Plans (or monthly payment, if applicable) that corresponds to the type of benefit elected shall cease and no further benefit (or payment) of that type will be provided under this Section 4(b)(ii). For purposes hereof, the term “Health Plans” means the group health plans providing vision benefits to executives of the Company (including any successor) and its affiliates.  The Executive has a right to continued medical, prescription and dental coverage under a separate agreement between the Executive and the Company, which shall remain in effect in accordance with its terms; 
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(iii) to the extent not theretofore paid or provided, the Company shall timely pay or cause to be paid or provide or cause to be provided to the Executive any other amounts or benefits required to be paid or provided or which the Executive is eligible to receive under any compensation arrangement, plan, program, policy or practice or contract or agreement of the Company and its affiliated companies with such payments being made in accordance with the terms of any such arrangement, plan, program or policy (such other amounts and benefits shall be hereinafter referred to as the “Other Benefits”).
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(c)  Notwithstanding any other provision of this Agreement, if the requirements of Section 1(e) are met regarding the Executive’s termination prior to a Change in Control, the Change in Control Benefits shall be paid within thirty (30) days after the date of a Change in Control (not the Date of Termination).
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(d)  Obligations of the Company in a Noncovered Termination. If the Executive’s employment shall cease by reason of a Noncovered Termination, this Agreement shall terminate without further obligations to the Executive other than the obligation timely to pay or cause to be paid or provide or cause to be provided to the Executive his Other Benefits.
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5.  FULL SETTLEMENT.
(a)  No Offset or Mitigation. The Company’s obligation to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense or other claim, right or action which the Company may have against the Executive.  In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the provisions of this Agreement and such amounts shall not be reduced whether or not the Executive obtains other employment.
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(b)  Executive’s Expenses in Dispute Resolution. The Company agrees to pay, to the full extent permitted by law, all legal fees and expenses which the Executive may reasonably incur as a result of a contest (in which the Executive substantially prevails) by the Company, the Executive or others of the validity or enforceability of, or liability under, any provision of this Agreement or any guarantee of performance thereof (including as a result of any contest by the Executive about the amount of any payment pursuant to this Agreement), plus in each case interest on any delayed payment at the lower of (i) the Wall Street Journal Prime Rate or (ii) the applicable Federal midterm rate provided for in Section 1274(d), compounded semi-annually, of the Code.
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(c)  Payment prior to Dispute Resolution. If there shall be any dispute between the Company and the Executive in the event of any termination of Executive’s employment, then, unless and until there is a final, nonappealable judgment by a court of competent jurisdiction declaring that such termination was a Noncovered Termination, that the determination by the Executive of the existence of Good Reason was not made in good faith, or that the Company is not otherwise obligated to pay any amount or provide any benefit to the Executive and his dependents or other beneficiaries, as the case may be, under Section 4(b), the Company shall pay all amounts, and provide all benefits, to the Executive and his dependents or other beneficiaries, as the case may be, that the Company would be required to pay or provide pursuant to Section 4(b) as though such termination were not a Noncovered Termination. Notwithstanding the foregoing, the Company shall not be required to pay any disputed amounts pursuant to this Section 5(c) except upon receipt of an adequate bond, letter of credit or undertaking by or on behalf of the Executive to repay all such amounts to which the Executive is ultimately adjudged by such court not to be entitled.

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6.   PAYMENT LIMITATION. 
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(a)  Section 280G Payment Limitation.  Notwithstanding anything contained in any other provision of this Agreement or any other agreement or plan to the contrary, the payments and benefits provided to, or for the benefit of, the Executive under this Agreement or under any other plan or agreement which became payable or are taken into account as a result of the Change in Control and which are parachute payments for purposes of Section 280G of the Code (the “Payments”) shall be reduced (but not below zero) so that the Present Value of the Payments is equal to the Limited Payment Amount and no Payment is subject to the imposition of an excise tax under Section 4999 of the Code.  Notwithstanding the foregoing, if the Net After-tax Benefit to the Executive resulting from receiving the Payments is greater than the Net After-tax Benefit to the Executive resulting from having the Payments reduced to the Limited Payment Amount, then the Payments shall not be reduced to the Limited Payment Amount.  For purposes hereof:
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(i)“Net After-tax Benefit” shall mean the Present Value of a Payment net of all taxes (including any Excise Tax imposed on the Executive) with respect thereto, determined by applying the highest marginal rate(s) applicable to an individual for the Executive’s taxable year in which the Change in Control occurs. 
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(ii)“Present Value” shall mean such value determined in accordance with Section 280G(d)(4) of the Code. 
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(iii)“Limited Payment Amount” shall be an amount expressed as a Present Value which maximizes the aggregate Present Value of Payments without causing any Payment to be subject to excise tax under Section 4999 of the Code or the deduction limitation of Section 280G of the Code (without taking into account any limitation on deductions under Section 162(m) of the Code). 
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In the event the Payments are to be reduced, the Company shall reduce or eliminate the Payments to the Executive by first reducing or eliminating those payments or benefits which are payable in cash and then by reducing or eliminating those payments which are not payable in cash, in each case in reverse order beginning with payments or benefits which are to be paid or provided the farthest in time from the Change in Control Date.  Any reduction pursuant to the preceding sentence shall take precedence over the provisions of any other plan, arrangement or agreement governing the Executive’s rights and entitlements to any benefits or compensation. 
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(b) Payment Limitation Determinations.  All determinations required to be made under this Section 6 shall be made by a public accounting firm selected by the Company that is reasonably acceptable to the Executive (the “Accounting Firm”).  The Accounting Firm shall provide its calculations, together with detailed supporting documentation, both to the Company and the Executive within 15 days after the receipt of notice from the Company that there has been a Payment (or at such earlier times as is requested by the Company) and, with respect to any Limited Payment Amount, a reasonable opinion to the Executive that the Executive is not required to report any excise tax on the Executive’s federal income tax return with respect to the Limited Payment Amount (collectively, the “Determination”).  In the event that the Accounting Firm is serving as an accountant or auditor for the individual, entity or group effecting the Change in Control, the Executive shall appoint another nationally recognized public accounting firm to make the determination required hereunder (which accounting firm shall then be referred to as the Accounting Firm hereunder).  All fees, costs and expenses (including, but not limited to, the costs of retaining experts) of the Accounting Firm shall be borne by the Company.  The Determination by the Accounting Firm shall be binding upon the Company and the Executive (except as provided in Section 6(c) below).
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(c)  Adjustments.  As a result of the uncertainty in the application of Section 280G and Section 4999 of the Code at the time of the initial determination by the Accounting Firm hereunder, it is possible that amounts will have been paid or distributed by the Company to or for the benefit of Executive that should not have been so paid or distributed (an “Overpayment”) or that additional amounts that will have not been paid or distributed by the Company to or for the benefit of Executive could have been so paid or distributed (an “Underpayment”). In the event that the Accounting Firm, based upon the assertion of a deficiency by the Internal Revenue Service against the Company or the Executive that the Accounting Firm believes has a high probability of success determines that an Overpayment has been made, any such Overpayment paid or distributed by the Company to or for the benefit of the Executive will be repaid by the Executive to the Company together with interest at the applicable federal rate 

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provided for in Section 7872(f)(2)(A) of the Code; provided, however, that no such repayment will be required if and to the extent such deemed repayment would not either reduce the amount on which the Executive is subject to tax under Section 4999 of the Code or generate a refund of such taxes. In the event that the Accounting Firm, based upon controlling precedent or substantial authority, determines that an Underpayment has occurred, any such Underpayment will be promptly paid by the Company to or for the benefit of the Executive, together with interest at the applicable federal rate provided for in Section 7872(f)(2)(A) of the Code, but no later than March 15 of the year after the year in which the Underpayment is determined to exist, which is when the legally binding right to such Underpayment arises.
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(d) Banking Payment Limitation. Notwithstanding anything contained in this Agreement or any other agreement or plan to the contrary, the payments and benefits provided to, or for the benefit of, the Executive under this Agreement or under any other plan or agreement shall be reduced (but not below zero) to the extent necessary so that no payment to be made, or benefit to be provided, to the Executive or for his benefit under this Agreement or any other plan or agreement shall be in violation of the golden parachute and indemnification payment limitations and prohibitions of 12 CFR Section 359. 
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7.  CODE SECTION 409A COMPLIANCE.
(a)The intent of the parties is that payments and benefits under this Agreement comply with Code Section 409A or comply with an exemption from the application of Code Section 409A and, accordingly, all provisions of this Agreement shall be construed in a manner consistent with the requirements for avoiding taxes or penalties under Code Section 409A. 
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(b)Neither the Executive nor the Company shall take any action to accelerate or delay the payment of any monies and/or provision of any benefits in any matter which would not be in compliance with Code Section 409A.
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(c)A termination of employment shall not be deemed to have occurred for purposes of any provision of this Agreement providing for the form or timing of payment of any amounts or benefits upon or following a termination of employment unless such termination is also a “separation from service” (within the meaning of Code Section 409A) and, for purposes of any such provision of this Agreement under which (and to the extent) deferred compensation subject to Code Section 409A is paid, references to a “termination” or “termination of employment” or like references shall mean separation from service.  A “separation from service” shall not occur under Code Section 409A unless the Executive has completely severed Executive’s relationship with the Company or the Executive has permanently decreased Executive’s services to twenty percent (20%) or less of the average level of bona fide services over the immediately preceding thirty-six (36) month period (or the full period if the Executive has been providing services for less than thirty-six (36) months). A leave of absence shall only trigger a termination of employment that constitutes a separation from service at the time required under Code Section 409A.  If the Executive is deemed on the date of separation from service with the Company to be a “specified employee”, within the meaning of that term under Code Section 409A(a)(2)(B) and using the identification methodology selected by the Company from time to time, or if none, the default methodology, then with regard to any payment or benefit that is required to be delayed for six (6) months in compliance with Code Section 409A(a)(2)(B), such payment or benefit (whether they would have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid or reimbursed in a lump sum with interest on the earlier of (i) the first day of the seventh (7th) month measured from the date of the Executive’s separation from service or (ii) the date of the Executive’s death, and any remaining payments and benefits due under this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein.  The amount of interest to be paid shall be based on the prime rate of interest in effect on the first day of the month following the Executive's separation from service as reported in the Wall Street Journal.  In the case of benefits required to be delayed under Code Section 409A, however, the Executive may pay the cost of benefit coverage, and thereby obtain benefits, during such six (6) month delay period and then be reimbursed by the Company thereafter on the first day of the seventh (7th) month following the date of the Executive’s separation from service or, if earlier, on the date of the Executive’s death.
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(d)With regard to any provision herein that provides for reimbursement of expenses or in-kind benefits, except as permitted by Code Section 409A, (i) the right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another benefit, and (ii) the amount of expenses eligible for reimbursement, or in- 

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kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, provided that the foregoing clause (ii) shall not be violated with regard to expenses reimbursed under any arrangement covered by Section 105(b) of the Code solely because such expenses are subject to a limit related to the period the arrangement is in effect. All reimbursements shall be reimbursed in accordance with the Company’s reimbursement policies but in no event later than the calendar year following the calendar year in which the related expense is incurred.
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(e)If under this Agreement, an amount is to be paid in two or more installments, for purposes of Code Section 409A, each installment shall be treated as a separate payment.
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(f)When, if ever, a payment under this Agreement specifies a payment period with reference to a number of days (e.g., “payment shall be made within ten (10) days following the date of termination”), the actual date of payment within the specified period shall be within the sole discretion of the Company or, if within the control of the Executive and payable over two calendar years, shall always be paid in the later calendar year.  In the event any payment payable upon termination of employment would be exempt from Code Section 409A under Treasury Regulation § 1.409A-1(b)(9)(iii) but for the amount of such payment, the determination of the payments to Executive that are exempt under such provision shall be made by applying the exemption to payments based on chronological order beginning with the payments paid closest in time on or after such termination of employment. 
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(g)Notwithstanding any of the provisions of this Agreement, the Company shall not be liable to the Executive if any payment or benefit which is to be provided pursuant to this Agreement and which is considered deferred compensation subject to Code Section 409A otherwise fails to comply with, or be exempt from, the requirements of Code Section 409A.
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8.  TERMINATION OF AGREEMENT. 
This Agreement shall be effective as of the Agreement Effective Date and shall normally continue until the later of the Agreement Regular Termination Date or, if a Change in Control has occurred, until the end of the Coverage Period. Notwithstanding the foregoing, this Agreement shall terminate in any event upon the Executive’s cessation of employment in a Noncovered Termination.
9.  COVENANTS OF EXECUTIVE.
(a)  No Disclosure by Executive. The Executive shall hold in a fiduciary capacity for the benefit of the Company all secret or confidential information, knowledge or data relating to the Company or any of its affiliated companies, and their respective businesses, which shall have been obtained by the Executive during the Executive’s employment by the Company or any of its affiliated companies and which shall not be or become public knowledge (other than by acts by the Executive or representatives of the Executive in violation of this Agreement). After termination of the Executive’s employment with the Company, the Executive shall not, without the prior written consent of the Company or as may otherwise be required by law or legal process, communicate or divulge any such information, knowledge or data to anyone other than the Company and those designated by it.
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Nothing in this Agreement restricts or prohibits the Executive or the Executive’s counsel from initiating communications directly with, responding to any inquiry from, volunteering information to, or providing testimony before a self-regulatory authority or a governmental, law enforcement or other regulatory authority, including the U.S. Equal Employment Opportunity Commission, the Department of Labor, the National Labor Relations Board, the Department of Justice, the Securities and Exchange Commission, the Financial Industry Regulatory Authority, the Congress, and any Office of Inspector General (collectively, the “Regulators”), from participating in any reporting of, investigation into, or proceeding regarding suspected violations of law, or from making other disclosures that are protected under or from receiving an award for information provided under the whistleblower provisions of state or federal law or regulation. The Executive does not need the prior authorization of the Company to engage in such communications with the Regulators, respond to such inquiries from the Regulators, provide confidential information or documents containing confidential information to the Regulators, or make any such reports or disclosures to the Regulators. The Executive is not required to notify the Company that the Executive has engaged in such communications with the Regulators. The Executive recognizes and agrees that, in connection with 

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any such activity outlined above, the Executive must inform the Regulators that the information the Executive is providing is confidential.
Federal law provides certain protections to individuals who disclose a trade secret to their attorney, a court, or a government official in certain, confidential circumstances. Specifically, federal law provides that an individual shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret under either of the following conditions:
		●	Where the disclosure is made (a) in confidence to a federal, state or local government official, either directly or indirectly, or to an attorney; and (b) solely for the purpose of reporting or investigating a suspected violation of law; or

		●	Where the disclosure is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.

Federal law also provides that an individual who files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual (a) files any document containing the trade secret under seal; and (b) does not disclose the trade secret, except pursuant to court order.
(b) Non-Competition. In consideration for the Company’s entering into this Agreement and in exchange for the benefits promised herein, and other valuable consideration, the Executive agrees that the Executive will not engage in “Competition” for a period of six (6) months after termination of the Executive’s employment with the Company pursuant to a Covered Termination. For purposes hereof, “Competition” means the Executive’s performing duties that are the same as or substantially similar to those duties performed by the Executive for the Holding Company, the Bank or their affiliates during the last twelve (12) months of the Executive’s employment, as an officer, a director, an employee, a partner or in any other capacity, within a fifty (50) mile radius of the headquarters of the Bank (or any Virginia headquarters of any successor in the event of a merger consummated as of the last day of employment) or within a ten (10) mile radius of any branch of the Bank (and any Virginia branch of any successor in the event of a merger consummated as of the last day of employment), as such locations exist as of the date the Executive’s employment terminates, if those duties are performed for a bank holding company, or for a bank or other financial institution, that provides products or services that are the same as or substantially similar to, and competitive with, any of the products or services provided by the Holding Company or the Bank or their affiliates at the time the Executive’s employment terminates.
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(c)  Remedies for Breach. It is recognized that damages in the event of breach of Section 9(a) or Section 9(b) above by the Executive would be difficult, if not impossible, to ascertain, and it is therefore specifically agreed that the Company, in addition to and without limiting any other remedy or right it may have, shall have the right to an injunction or other equitable relief in any court of competent jurisdiction, enjoining any such breach. The existence of this right shall not preclude the Company from pursuing any other rights and remedies at law or in equity which it may have.
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(d)  Breach Not Basis to Withhold Payment. In no event shall an asserted violation of the provisions of this Section 9 constitute a basis for deferring or withholding any amounts otherwise payable to the Executive under this Agreement.
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10.  BENEFIT AND SUCCESSORS.
(a) Executive’s Benefit. This Agreement shall inure to the benefit of and be enforceable by the Executive’s personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees. If the Executive should die and any amount remains payable hereunder after his death, any such amount, unless otherwise agreed by the Company or provided herein, shall be paid in accordance with the terms of this Agreement to the Executive’s devisee, legatee or other designee of such payment or, if there is no such designee, the Executive’s estate.
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(b)  Company’s Benefit. This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns.
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(c)  Assumption by Successor to Company. The Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place.  As used in this Agreement, “Company” shall mean the Company as hereinbefore defined and any successor to its business and/or assets as aforesaid which assumes and agrees to perform this Agreement by operation of law, or otherwise.
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11. MISCELLANEOUS.
(a)  Governing Law; Venue; Jury Waiver. This Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Virginia, without reference to principles of conflict of laws. The captions of this Agreement are not part of the provisions hereof and shall have no force or effect.  The parties agree that venue in the event of a dispute shall be exclusively in the Circuit Court of the King William County, or the applicable federal court encompassing that jurisdiction, at the sole option of Company, and Executive agrees not to object to venue.  Executive and Company further agree that in the event of any judicial proceeding arising out of a dispute between them that they knowingly and voluntarily waive their right to trial by jury and agree that the dispute will be decided by the Court sitting without a jury.
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(b)  Amendment. This Agreement may not be amended or modified otherwise than by a written agreement executed by the parties hereto or their respective successors and legal representatives which complies with the requirements of Code Section 409A.
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(c)  Notices. All notices and other communications hereunder shall be in writing and shall be given by hand delivery to the other party or by registered or certified mail, return receipt requested, postage prepaid, addressed as follows:
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If to the Executive:
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Larry G. Dillon
C&F Financial Corporation
3600 La Grange Parkway
Toano, Virginia 23168
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If to the Company (the Holding Company and/or the Bank):
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President, C&F Financial Corporation
3600 La Grange Parkway
Toano, Virginia 23168
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Copy to:
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James H. Hudson III 
Hudson Law PLC 
826 Main Street – P.O. Box 231 
West Point, Virginia 23181 
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or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notice and communications shall be effective when actually received by the addressee.
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(d)  Severability. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.
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(e)  Tax Withholding. The Company may withhold from any amounts payable under this Agreement such Federal, state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.
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(f)  Waiver. The Executive’s or the Company’s failure to insist upon strict compliance with any provision of this Agreement or the failure to assert any right the Executive or the Company may have hereunder, including, without limitation, the right of the Executive to terminate employment for Good Reason pursuant to this Agreement, shall not be deemed to be a waiver of such provision or right or any other provision or right of this Agreement.
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(g)  Executive’s Employment. The Executive and the Company acknowledge that, except as may otherwise be provided under any other written agreement between the Executive and the Company, the employment of the Executive by the Company is “at will” and, subject to paragraph (ii) of Section 1(h) herein deeming a termination to have occurred on or after the occurrence of a Change in Control Date, the Executive’s employment and/or this Agreement may be terminated by either the Executive or the Company at any time prior to the Change in Control Date, in which case the Executive shall have no further rights under this Agreement.
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(h)  Nonexclusivity of Rights. Except as expressly provided in Section 6, nothing in this Agreement shall prevent or limit the Executive’s continuing or future participation in any plan, program, policy or practice provided by the Company or any of its affiliated companies and for which the Executive may qualify, nor shall anything herein limit or otherwise affect such rights as the Executive may have under any contract or agreement with the Company or any of its affiliated companies. Amounts which are vested benefits or which the Executive is otherwise entitled to receive under any plan, policy, practice or program of or any contract or agreement with the Company or any of its affiliated companies at or subsequent to the Executive’s termination shall be payable in accordance with such plan, policy, practice or program or contract or agreement except as explicitly modified by this Agreement.
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(i)  Statutory References. Any reference in this Agreement to a specific statutory provision shall include that provision and any comparable provision or provisions of future legislation amending, modifying, supplementing or superseding the referenced provision.
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(j)  Nonassignability. This Agreement is personal to the Executive, and without the prior written consent of the Company, no right, benefit or interest hereunder shall be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance or charge, except by will or the laws of descent and distribution, and any attempt thereat shall be void; and no right, benefit or interest hereunder shall, prior to receipt of payment, be in any manner liable for or subject to the recipient’s debts, contracts, liabilities, engagements or torts.
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(k)  Counterparts/Facsimile/Electronic Signature.   This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument. In the event that any signature is executed or delivered by means of an electronic signature (such as DocuSign), facsimile or scanned pages via electronic mail, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such electronic signature, facsimile or scanned pages were the original signed version thereof delivered in person.
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(l)  Employment with Affiliates.  Except as otherwise required by this Agreement or Code Section 409A, employment with the Company for purposes of this Agreement shall include employment with any corporation or other entity in which the Company has a direct or indirect ownership interest of 50% or more of the total combined voting power of the then outstanding securities of such corporation or other entity entitled to vote generally in the election of directors or which has a direct or indirect ownership interest of 50% or more of the total combined voting power of the then outstanding securities of the Company entitled to vote generally in the election of directors.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above. 
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	/s/ Larry G. Dillon
Larry G. Dillon
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C&F Financial Corporation
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By: /s/ Thomas F. Cherry
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Its: President and Chief Executive Officer

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	Citizens and Farmers Bank
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By: /s/ Thomas F. Cherry
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Its: President and Chief Executive Officer

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EXHIBIT 10.8

C&F FINANCIAL CORPORATION 
Management Incentive Plan 
(as amended and restated effective January 1, 2022)
  
  
ARTICLE I 
OBJECTIVE OF THE PLAN 
  
The purpose of the Management Incentive Plan (“MIP”) is to attract, retain and motivate key employees, as approved by the Compensation Committee (“Committee”), of C&F Financial Corporation (“Company”) and its direct or indirect subsidiaries.    The MIP is not applicable to all employees nor to all incentive-based compensation throughout the Company. 
  
The MIP is designed to link key employee interests more closely with the interests of the Company’s shareholders and to create value for the Company by maximizing achievement of corporate, business unit and individual performance goals, consistent with the Company’s risk management philosophy and safety and soundness goals. 
  
Each Participant’s awards under this MIP will take into account corporate performance as well as, where appropriate, his or her own business unit’s performance. Awards under the MIP may also reflect individual performance.  
  
ARTICLE II 
PLAN ADMINISTRATION 
  
The MIP will be administered by the Committee, which will have the power and authority to interpret the MIP, select employees to participate in the MIP, establish target awards and performance objectives under the MIP, and establish guidelines for determining individual awards and rules for the operation and administration of the MIP.   Except as limited by Article V below, the Committee or, with respect to awards for certain non-executive officer participants, the Chief Executive Officer will also have the power and authority to adjust upward or downward any award, at its discretion, in light of such considerations as the Committee or Chief Executive Officer, as applicable, may deem relevant (but subject to applicable limitations of the Company’s 2013 Stock and Incentive Compensation Plan or any successor stock plan (the “Company’s Stock Plan”) with respect to Equity Based Awards). 
  
Except as expressly otherwise provided herein in the case of Executive Officers (as defined in Rule 3b-7 under the Securities Exchange Act of 1934), who are the Chief Executive Officer and President (“Chief Executive Officer”) and the Chief Financial Officer of the Company and C&F Bank, the Chief Credit Officer of C&F Bank, the President of C&F Finance Company and the Chief Executive Officer of C&F Mortgage Corporation, or as prohibited by any national securities exchange or system on which the Company’s stock is then listed or reported, by any regulatory body having jurisdiction with respect thereto or under any other applicable laws, rules or regulations, the Committee may delegate one or more of its powers or responsibilities under the MIP to one or more of its members and/or to one or more of the Executive Officers of the Company. 
  
The Chief Executive Officer’s incentive awards (whether cash or in the form of Equity Based Awards) will be determined solely by the Committee, and the Chief Executive Officer shall not be present during such deliberations or voting. 
  
The MIP is an annual plan and shall remain in effect until amended or terminated by the Board of Directors in accordance with Article X of the MIP. A new plan year shall commence on the first business day of each fiscal year of the Company.  The Committee shall review the MIP annually and recommend any amendments or revisions thereto, which it deems appropriate or desirable, for approval by the Board of Directors. 

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ARTICLE III 
PARTICIPANTS 
  
Persons who may participate in the MIP are limited to key employees of the Company and its direct or indirect subsidiaries who are: (a) approved by the Committee (in the case of the Chief Executive Officer of the Company and C&F Bank) and (b) for all others, recommended by the Chief Executive Officer and approved by the Committee (collectively, “Participants”). 
  
To be eligible for the MIP in any particular year, key employees must be employees of the Company or a subsidiary as of January 1st of the plan year for which an award is being made. In addition, employees who are either hired as key employees or are promoted and become key employees after the beginning of a plan year may be designated as Participants for the plan year and assigned a prorated target at the Committee’s discretion. 
  
  
ARTICLE IV 
PERFORMANCE OBJECTIVES 
  
In connection with the administration of the MIP, the Committee or the Chief Executive Officer, in the case of certain non-executive officer participants, shall establish: 
  
(i)MIP performance objectives for the Company and any subsidiary (“Corporate Goals”), and appropriate business units of the Company (“Business Unit Goals”) and individuals (“Individual Goals”) based upon such criteria as may be agreed upon by the Committee, and 
  
(ii)The award formula or matrix by which incentive awards under the MIP shall be calculated. 
  
Except as provided herein in the case of Executive Officers, the selection of such performance objective(s) and the award formula or matrix may vary on a Participant-by-Participant basis. 
  
Generally, prior to or within the first 90 days of each plan year, the Committee or the Chief Executive Officer, as applicable, shall review the previously established Corporate Goals, Business Unit Goals and Individual Goals and make any changes to such performance objectives as it deems appropriate for the new plan year. 
  
  
ARTICLE V 
AWARDS 
  
The MIP provides for cash incentive awards (“Cash Awards”) and/or equity incentive awards (“Equity Based Awards”).  Except as provided herein in the case of Executive Officers, target awards may be weighted between Corporate, Business Unit and Individual Goals on such basis as the Committee determines and the weighting may vary on a Participant-by-Participant basis.  Separate performance objectives and award formulas or matrixes may be established for Cash Awards and Equity Based Awards.  Cash Awards shall be settled in cash.  Equity Based Awards shall be settled in cash and/or Company stock, as determined by the Committee or the Chief Executive Officer, as applicable. 
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Cash Awards
  

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Each Participant shall be assigned a Cash Award target, which shall be paid or provided if the Participant achieves his or her Cash Award targeted performance goal(s).  All cash incentive awards made to the President of C&F Mortgage Corporation (“C&F Mortgage”) shall be made pursuant to such President’s Employment Agreement, as in effect from time to time, with C&F Mortgage or the Company, and not pursuant to this MIP, for any year for which such Employment Agreement provides for an annual incentive arrangement. 
  
Unless otherwise provided by the Committee, the Cash Award targets for a plan year for the Chief Executive Officer of the Company and C&F Bank and for the Chief Financial Officer of the Company and C&F Bank will be based solely on achievement of the Corporate Goal, which for the Cash Awards is based on the Company’s return on equity (as defined by the Committee) (“ROE”) and return on assets (as defined by the Committee) (“ROA”) for the plan year for which the Cash Award is made compared to a peer group of banks selected by the Committee.  If 100% of the Cash Award Corporate Goal is achieved for a plan year, each of the Chief Executive Officer and the Chief Financial Officer will be eligible to receive a Cash Award equal to his or her individual Cash Target Award designated by the Committee.  If greater than or less than 100% (but at least the Minimum Award Level designated by the Committee) of the Cash Award Corporate Goal is achieved for a plan year, each of the Chief Executive Officer and the Chief Financial Officer will be eligible to receive a Cash Award equal to more or less than 100% of his or her individual Cash Target Award (but in no event more than the Maximum Award Percentage designated by the Committee) based on an award matrix established by the Committee.  Any award calculation or payment may be adjusted by the Committee, at its discretion, based on asset quality (loans) measures of the Company or any other measurement deemed relevant.  The measures are listed in the Cash Award Targets and Goals which are set pursuant to Article IV of this MIP.     
  
Unless otherwise provided by the Committee, the Cash Award target for a plan year for the President of C&F Finance Company will be based on the ROA of C&F Finance Company (as defined by the Committee) and other measurements deemed relevant, as established by the Committee based on the recommendation of the Chief Executive Officer.  If achievement is more or less than the targeted performance, the amount of the Cash Award earned will be determined pursuant to an award matrix established by the Committee. Any award calculation or payment may be adjusted by the Committee, at its discretion, based on asset quality measures of C&F Finance Company and any other measurement deemed relevant. The measures are listed in the Cash Award Targets and Goals which are set pursuant to Article IV of this MIP.  
  
Unless otherwise provided by the Committee, the Cash Award target for a plan year for the Chief Credit Officer of C&F Bank will be based on the net income of C&F Bank and other C&F Bank-related measurements deemed relevant, all of which are established by the Committee based on the recommendation of the Chief Executive Officer. The Committee will determine the Cash Award earned based on an evaluation of these measures.  The measures are listed in the Cash Award Targets and Goals which are set pursuant to Article IV of this MIP.  
  
As mentioned above, all cash incentive awards made to the President of C&F Mortgage shall be made pursuant to such President’s Employment Agreement, as in effect from time to time, with C&F Mortgage or the Company, and not pursuant to this MIP, for any year for which such Employment Agreement provides for an annual incentive arrangement. 
  
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Equity Based Awards
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Participants may also be awarded Equity Based Awards consisting of restricted stock, units, stock options, or other stock equivalent awards.  While the general parameters of the Equity Based Awards are described in the MIP, the actual grant of the Equity Based Awards will be made under the Company’s Stock Plan and will be governed by the terms of the applicable award agreement as provided under the Stock Plan (the “Equity Award Agreement”).  Unless otherwise provided by the Committee,  Equity Based Awards for a plan year will be granted to a Participant near or following the end of the plan year upon determination of the amount, if any, of the 

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Equity Based Awards as provided in Article VII (the “Grant Date”), and in the case of Executive Officers will be in the form of time-based restricted stock, in each case subject to vesting and other terms established by the Committee, at its discretion, and set forth in the applicable Equity Award Agreement.  The Committee will determine the appropriate valuation methodology for determining the fair market value of such Equity Based Awards on the Grant Date.  
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Unless otherwise provided by the Committee, Equity Based Awards for the Executive Officers will have two components, a component that is based solely on continued service (the “Annual Equity Awards”) and a component that is based on performance (the “Performance-Based Equity Awards”).  Generally, prior to or within the first 90 days of each plan year, the Committee shall determine the percentage of each Executive Officer’s Equity Based Awards that will consist of Annual Equity Awards and the percentage that will consist of Performance-Based Equity Awards.  
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Unless otherwise provided by the Committee and unless in the exercise of its discretion, the Committee determines the award is not to be granted, an Annual Equity Award will be granted (subject to additional time-based vesting conditions and subject to forfeiture if the additional time-based vesting conditions are not satisfied) if the Executive Officer is employed by the Company or any subsidiary on the Grant Date. 
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Unless otherwise provided by the Committee, for the Chief Executive Officer and Chief Financial Officer of the Company and C&F Bank, a Performance-Based Equity Award will be granted (subject to additional time-based and performance-based vesting conditions, in the Committee’s discretion, and subject to forfeiture if the additional time-based and performance-based vesting conditions are not satisfied) based on the achievement of a corporate goal, which is the Company’s 3-year annual return on tangible common equity (as defined by the Committee) compared to that of a peer group designated by the Committee. If achievement is more or less than the targeted performance, the amount of the Performance-Based Equity Award granted will be determined pursuant to an award matrix established by the Committee. 
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Unless otherwise provided by the Committee, for the President of C&F Finance Company, Chief Credit Officer of C&F Bank and President of C&F Mortgage, a Performance-Based Equity Award will be granted (subject to additional time-based and performance-based vesting conditions, in the Committee’s discretion, and subject to forfeiture if the additional time-based and performance-based vesting conditions are not satisfied) based on the achievement of a corporate goal, which is the Company’s 3-year annual return on tangible common equity (as defined by the Committee) compared to that of a peer group designated by the Committee, and the performance of the executive officer’s business unit as measured by net income and achievement of other strategic goals established for each such officer by the Committee. If achievement is more or less than the targeted performance, the amount of the Performance-Based Equity Award granted will be determined pursuant to an award matrix established by the Committee. 
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The Committee will have the power and authority to adjust downward any Equity Based Award to be granted to an Executive Officer, at its discretion, in light of such considerations as the Committee may deem relevant.   
  
The Cash Award targets and Equity Based Award targets for certain non-Executive Officer Participants shall be determined by the Chief Executive Officer based on the applicable Corporate Goals, Business Unit Goals or Individual Goals or any combination thereof.  Such Business Unit Goals and Individual Goals established by the Chief Executive Officer shall be based on specific business unit and individual objectives annually.  These include, but are not limited to, net income, loan and deposit growth, asset quality, margins, productivity, soundness, and customer satisfaction.  Notwithstanding any pre-established goals, the Chief Executive Officer will have the power and authority to adjust upward or downward any Cash Award or Equity Based Award to be granted for any Participant who is not an Executive Officer, at his discretion, in light of such considerations as he may deem relevant.  
  

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ARTICLE VI 
ENTITLEMENT TO AWARDS 
  
Within 60 days following the end of each plan year, the Committee or the Chief Executive Officer, as applicable, will review performance against the Cash Award targets and Equity Based Award targets, certify in writing the extent to which applicable performance goals were satisfied, and determine the amount of Cash Award, if any, to be earned and paid and Equity Based Award, if any, to be granted to each Participant under the MIP.
​
With respect to Cash Awards, except as provided below, no award shall be earned and payable to a Participant unless that Participant meets the applicable performance requirements (subject to applicable discretion described above) and is also an employee of the Company and/or any subsidiary from January 1st of that plan year (or if later, the date he or she is designated as a Participant for that plan year) through either (a) the last day of that plan year or (b) if so provided by the Committee, prior to the end of the plan year to which the award relates, through the date the award for that plan year is paid (the “Vesting Date”).  
  
  
With respect to Cash Awards, subject to all applicable performance requirements, in the event of a Participant’s death, total and permanent disability, retirement or involuntary termination without cause during a plan year, such awards shall be calculated for that plan year and then pro-rated by multiplying the annual award by a fraction, the numerator of which is the number of full months, including the month in which the terminating event occurred, in the plan year which includes the terminating event and the denominator of which is twelve.  In such event, payout will occur at the same time all other earned and vested award payments are made for that plan year.  Otherwise, a Participant who is not employed by the Company or a subsidiary for any other reason on the Vesting Date for a plan year shall not have earned his or her award for that plan year unless otherwise determined by the Committee. 
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With respect to Equity Based Awards, no Equity Based Award will be granted unless the Participant is employed by the Company or any subsidiary on the Grant Date.  The vesting and payment terms of the Equity Based Awards will be set forth in the applicable Equity Award Agreement. 
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ARTICLE VII 
PAYMENT OR PROVISION OF EARNED AND VESTED AWARDS 
  
Earned and vested Cash Awards shall be paid as soon as practicable following the Vesting Date; however, in no event shall such awards be paid later than March 15th following the end of each plan year, allowing the Company adequate time to formally analyze its financial results according to the regulations and procedures of a public company. 
  
Equity Based Awards are granted under the  Company’s Stock Plan and evidenced by an Equity Award Agreement.  The Committee will determine who is to be granted an Equity Based Award and the amount, if any, of such award in accordance with the guidelines set forth in the MIP.  A Participant will earn and vest in the Equity Based Award as provided under the applicable Equity Award Agreement.  The Grant Date will  be determined by the Committee, but will be no later than March 15th following the end of each plan year.  Such grants may include such service-based and/or performance-based requirements as the Committee may determine.  
  
  
  
ARTICLE VIII 

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NO ENTITLEMENT TO BONUS 
  
Participants are entitled to a distribution under the MIP only upon the determination by the Committee or the Chief Executive Officer, as applicable, that the award is earned, vested and payable.  
  
  
ARTICLE IX 
CLAWBACK 
  
All Cash Awards granted under the MIP and all Equity Based Awards granted under the MIP and the Company’s Stock Plan (in each case, whether vested or unvested) shall be subject to the terms of the Company’s recoupment, clawback or similar policy as such may be in effect from time to time, as well as any similar provisions of applicable law, Securities and Exchange Commission rule or regulation or stock exchange requirement, which could in certain circumstances require repayment or forfeiture of Cash Awards and Equity Based Awards (including any value received from a disposition of the stock acquired upon payment of the Equity Based Awards). 
  
  
ARTICLE X 
AMENDMENT OR TERMINATION OF PLAN 
  
The Board of Directors reserves the right to amend or terminate the MIP at any time, based on the recommendation of the Committee.  
  
In the event the MIP is amended by the Board of Directors more than 90 days after the beginning of a plan year in a manner which could reduce the award payable to a Participant for that plan year, the Participant shall continue to be eligible for incentive awards, if earned, for the plan year in which the amendment of the MIP occurs, with incentive awards being prorated as of the date of the MIP amendment based on the old and new provision of the MIP, unless otherwise agreed by the Participant. 
  
In the event the MIP is terminated by the Board of Directors, unless otherwise agreed by a Participant, Participants shall continue to be eligible for incentive awards, if earned, for the plan year in which the termination of the MIP occurs, with incentive awards being prorated as of the date of the MIP termination. 
  
  
ARTICLE XI 
NO RIGHT OF ASSIGNABILITY 
  
Participant awards shall not be subject to assignment, pledge or other disposition, nor shall such amounts be subject to garnishment, attachment, transfer by operation of law, or any legal process. 
  
Nothing contained in the MIP shall confer upon employees any right to continued employment, nor interfere with the right of the Company to terminate a MIP Participant’s employment with the Company or any subsidiary.  Participation in the MIP does not confer rights to participation in other Company programs, including non-qualified retirement or deferred compensation plans or other executive perquisite programs. 
  
The MIP is intended to constitute an “unfunded” plan for incentive compensation.  With respect to any award as to which a Participant has an earned and vested interest but which is not yet paid to the Participant, nothing 

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contained herein shall give any such Participant any rights that are greater than those of a general unsecured creditor of the Company. 
  
  
ARTICLE XII 
GOVERNING LAW 
  
The MIP shall be governed, construed, and administered in accordance with the laws of the Commonwealth of Virginia. 
  
In the event any provision of the MIP shall be held illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining parts of the MIP. 
  
ARTICLE XIII 
EFFECTIVE DATE 
  
The MIP, as amended and restated, has been approved by the Board of Directors, shall apply to bonuses under the MIP beginning with performance during the 2022 calendar year, and shall remain in effect until amended or terminated by the Board of Directors in accordance with Article X of the MIP. 
  
As amended and restated by the Board of Directors on December 21, 2021, to be effective January 1, 2022.     

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