EXHIBIT 10.7
RIVERVIEW NATIONAL
BANK
DIRECTOR DEFERRED FEE
AGREEMENT
THIS AGREEMENT is made this
31 st day of December, 2008, by RIVERVIEW
NATIONAL BANK, a national bank located in Marysville, Pennsylvania
(the “Bank”), and
,
(the “Director”).
INTRODUCTION
To encourage the Director to remain
a member of the Bank’s Board of Directors, the Bank is
willing to provide to the Director a deferred fee opportunity. The
Bank will pay the benefits from its general assets.
AGREEMENT
The Director and the Bank agree as
follows:
Article 1
Definitions
1.1
Definitions
. Whenever used in this
Agreement, the following words and phrases shall have the meanings
specified:
1.1.1
“Change in
Control” means a
change in the ownership or effective control of the Corporation or
the Bank as described in Section 409A(a)(2)(A)(v) of the
Code.
Notwithstanding anything else to the
contrary set forth in this Agreement, if (i) an agreement is
executed by the Corporation or the Bank providing for any of the
transactions or events constituting a Change in Control as defined
herein, and the agreement subsequently expires or is terminated
without the transaction or event being consummated, and
(ii) Director’s service did not terminate during the
period after the agreement and prior to such expiration or
termination, for purposes of this agreement it shall be as though
such agreement was never executed and no Change in Control event
shall be deemed to have occurred as a result of the execution of
such Agreement.
1.1.2
“Code”
means the Internal Revenue Code of
1986, as amended, and the regulations promulgated
thereunder.
1.1.3
“Corporation”
means Riverview Financial
Corporation.
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1.1.4
“Disability” means the Director’s inability to perform
substantially all normal duties of a director, provided such
disability complies with the definition provided under Code
Section 409A. As a condition to receiving any benefits, the
Bank may require the Director to submit to such physical or mental
evaluations and tests as the Board of Directors deems
appropriate.
1.1.5
“Election
Form” means the
Form attached as Exhibit A.
1.1.6
“Fees”
means the total amount earned by
the Director for serving on the Bank’s Board.
1.1.7
“Normal Benefit
Age” means the
benefit distribution age specified by the Director in
Exhibit A.
1.1.8
“Plan
Year” means each
twelve (12) month period commencing with the month deferrals
commence under this Agreement.
1.1.9
“Termination of
Service” means the
Director’s ceasing to be a member of the Bank’s Board
of Directors for any reason other than death, provided such
termination of service complies with the definition of termination
of service under Code Section 409A.
Article 2
Deferral Election
2.1
Initial Election
. The Director shall make an
initial deferral election under this Agreement by filing with the
Bank a signed Election Form within thirty (30) days after the
date of this Agreement. The Election Form shall set forth the
amount of Fees to be deferred, provided such deferral opportunity
shall be limited to Fees earned during the ten-year period ending
December 31, 2018 unless an extension is approved in writing
by the Bank. The Election Form shall be effective to defer
only Fees earned after the date the Election Form is received
by the Bank.
2.2
Election Changes
. The Director may modify the
amount of Fees to be deferred annually by filing a new Election
Form with the Bank. The modified deferral shall not be
effective until the calendar year following the year in which the
subsequent Election Form is received by the Bank. Any changes
to the form of benefit payment must be in accordance with
Exhibit A.
Article 3
Deferral Account
3.1
Establishing and
Crediting . The
Bank shall establish a Deferral Account on its books for the
Director, and shall credit to the Deferral Account the following
amounts:
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3.1.1
Deferrals . The fees deferred by the Director as of
the time the Fees would have otherwise been paid to the
Director.
3.1.2
Interest. Interest at an annual rate of 70% of
R.O.E. R.O.E. is to be calculated by a daily quarterly
average.
3.2
Statement of Accounts
. The Bank shall provide to
the Director, within one hundred twenty (120) days after each Plan
Year, a statement setting forth the Deferral Account
balance.
3.3
Accounting Device Only
. The Deferral Account is
solely a device for measuring amounts to be paid under this
Agreement. The Deferral Account is not a trust fund of any kind.
The Director is a general unsecured creditor of the Bank for the
payment of benefits. The benefits represent the mere Bank promise
to pay such benefits. The Director’s rights are not subject
in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, attachment or garnishment by the
Director’s creditors.
Article 4
Lifetime Benefits
4.1
Normal Benefit Age
. If the Director terminates
service as a Director on or after Normal Benefit Age, the Bank
shall pay to the Director the benefit described in this
Section 4.1 in lieu of any other benefit under this
Agreement.
4.1.1
Amount of Benefit
. The benefit under this
Section 4.1 is the Deferral Account balance at the date
specified in Exhibit A.
4.1.2
Payment of Benefit
. The Bank shall pay the
benefit to the Director in the form specified in Exhibit A. If
installment payments are elected, the Bank shall continue to credit
interest at an annual rate as defined in Section 3.1.2 above,
on the undistributed account balance during any applicable
installment period.
4.2
Early Termination
Benefit . If the
Director terminates service as a Director before the Normal Benefit
Age for reasons other than death, disability or following a Change
in Control, the Bank shall pay to the Director the benefit
described in this Section 4.2 in lieu of any other benefit
under this Agreement.
4.2.1
Amount of Benefit
. The Benefit under this
Section 4.2 is the Deferral Account balance at the
Director’s Termination of Service.
4.2.2
Payment of Benefit
. The Bank shall pay the
benefit to the Director in the form specified in Exhibit A. If
installment payments are elected, the Bank shall continue to credit
interest at an annual rate as
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defined in Section 3.1.2 above,
on the undistributed account balance during any applicable
installment period.
4.3
Disability Benefit
. Upon Termination of Service
for disability prior to the Normal Benefit Age, the Bank shall pay
to the Director the benefit described in this Section 4.3 in
lieu of any other benefit under this Agreement.
4.3.1
Amount of Benefit
. The benefit under this
Section 4.3 is the Deferral Account balance at the date
specified in Exhibit A. If applicable, the Bank shall continue
to credit interest to the Deferral Account balance at a rate as
defined in Section 3.1.2 above, during the period from
Termination of Service until payments commence.
4.3.2
Payment of Benefit
. The Bank shall pay the
benefit to the Director in the form specified in Exhibit A. If
installment payments are elected, the Bank shall continue to credit
interest at an annual rate as defined in Section 3.1.2 above,
on the undistributed account balance during any applicable
installment period.
4.4
Change of Control
Benefit . If the
Director is in the active service of the Bank when the change
occurs, the Bank shall pay to the Director the benefit described in
this Section 4.4 in lieu of any other benefit under this
Agreement.
4.4.1
Amount of Benefit
. The benefit under this
Section 4.4 is the Deferral Account balance at the date
specified in Exhibit A. If applicable, the Bank shall continue
to credit interest to the Deferral Account balance at a rate as
defined in Section 3.1.2 above, during the period from
Termination of Service until payments commence.
4.4.2
Payment of Benefit
. The Bank shall pay the
benefit to the Director in the form specified in Exhibit A. If
installment payments are elected, the Bank shall continue to credit
interest at an annual rate as defined in Section 3.1.2 above,
on the undistributed account balance during any applicable
installment period.
4.5
Hardship Distribution
. If an unforeseeable
financial emergency arising from the death of a family member,
divorce, sickness, injury, catastrophe or similar event outside the
control of the Director occurs, provided such emergency qualifies
as an unforeseeable emergency under Code Section 409A, the
Director may petition the Board for early payout of his Deferral
Account. If the Board determines that the Director’s request
constitutes an unforeseeable financial emergency as provided under
Code 409A, the Bank shall distribute to the Director all or a
portion of the Deferral Account balance as determined by the Bank,
but in no event shall the distribution be greater than is necessary
to relieve the financial hardship.
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Article 5
Death Benefits
5.1
Death Prior to Commencement of
Benefit Payments .
If the Director dies prior to commencement of benefit payments, the
Bank shall pay to the Director’s beneficiary the benefit
described in this Section 5.1 in lieu of any other benefit
under this Agreement.
5.1.1
Amount of Benefit
. The benefit amount under
Section 5.1 is the Deferral Account balance.
5.1.2
Payment of Benefit
. The Bank shall pay the
benefit to the beneficiary in the form specified in Exhibit A,
with payment made or commencing on the first day of
January following the Director’s death. If installment
payments are elected, the Bank shall continue to credit
in
