SECOND AMENDMENT
TO THE
MID PENN BANK
AMENDED AND RESTATED DIRECTOR DEFERRED FEE AGREEMENT
DATED JANUARY 1, 2005
AND AMENDED JUNE 28, 2007
FOR
▇▇▇▇ ▇▇▇▇▇
This Second Amendment is adopted this 26 day of March, 2008, by MID PENN
BANK, a state-chartered commercial bank located in Millersburg, Pennsylvania
(the "Company"), and ▇▇▇▇ ▇▇▇▇▇ (the "Director").
The Company and the Director executed the Amended and Restated Director
Deferred Fee Agreement effective as of January 1, 2005 and a First Amendment was
executed on June 28, 2007 (the "Agreement").
The undersigned hereby amend the Agreement for the purpose of updating the
death benefit. Therefore, the following changes shall be made:
SECTION 5.1.1 OF THE AGREEMENT SHALL BE DELETED IN ITS ENTIRETY AND
REPLACED BY THE FOLLOWING:
5.1.1 AMOUNT OF BENEFIT. The benefit under this Section 5.1 is the Deferral
Account balance at the Executive's death.
IN WITNESS OF THE ABOVE, the Company and the Director hereby consent to
this First Amendment.
Director: MID PENN BANK
/s/ ▇▇▇▇ ▇▇▇▇▇ By /s/ [ILLEGIBLE]
------------------------------ ------------------------------
▇▇▇▇ ▇▇▇▇▇ Title V. P.
1
SECOND AMENDMENT
TO THE
MID PENN BANK
AMENDED AND RESTATED DIRECTOR DEFERRED FEE AGREEMENT
DATED JANUARY 1, 2005
AND AMENDED JUNE 28, 2007
FOR
▇▇▇▇ ▇▇▇▇▇
This Second Amendment is adopted this 26 day of March, 2008, by MID PENN
BANK, a state-chartered commercial bank located in Millersburg, Pennsylvania
(the "Company"), and ▇▇▇▇ ▇▇▇▇▇ (the "Director").
The Company and the Director executed the Amended and Restated Director
Deferred Fee Agreement effective as of January 1, 2005 and a First Amendment was
executed on June 28, 2007 (the "Agreement").
The undersigned hereby amend the Agreement for the purpose of updating the
death benefit. Therefore, the following changes shall be made:
SECTION 5.1.1 OF THE AGREEMENT SHALL BE DELETED IN ITS ENTIRETY AND
REPLACED BY THE FOLLOWING:
5.1.1 AMOUNT OF BENEFIT. The benefit under this Section 5.1 is the Deferral
Account balance at the Executive's death.
IN WITNESS OF THE ABOVE, the Company and the Director hereby consent to
this First Amendment.
Director: MID PENN BANK
/s/ ▇▇▇▇ ▇▇▇▇▇ By /s/ [ILLEGIBLE]
------------------------------ ------------------------------
▇▇▇▇ ▇▇▇▇▇ Title V. P.
1
MID PENN BANK
AMENDED AND RESTATED
DIRECTOR DEFERRED FEE AGREEMENT
THIS AMENDED AND RESTATED DIRECTOR DEFERRED FEE AGREEMENT ("Agreement") is
effective the 1st day of January, 2005, by and among Mid Penn Bank, a state
commercial bank located in Millersburg, Pennsylvania (the "Company"), Mid Penn
Bancorp, Inc., a Pennsylvania corporation (the "Corporation") and ▇▇▇▇ ▇▇▇▇▇
(the "Director").
WITNESSETH:
WHEREAS, the Company and the Director entered into a certain Director
Deferred Fee Agreement dated December 30, 2005; and
WHEREAS, the Company and the Director wish to amend the Director Deferred
Fee Agreement for compliance with Section 409A of the Internal Revenue Code
("Section 409A"); and
WHEREAS, the Company wishes to encourage the Director to remain a member
of the Company's Board of Directors, and the Company is willing to provide to
the Director a deferred fee opportunity, the benefits of which will be payable
from the Company's general assets.
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, the parties hereby 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 A Change in Control (other than one occurring by reason of an
acquisition of the Company by Employee) shall be deemed to have occurred
if the Board of Directors of the Company certifies on an objective basis
that one of the
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following has occurred:
(A) a sale or other transfer of ownership of all or
substantially all (50% or more of the total gross fair market value)
of the assets of Company to any individual, corporation,
partnership, trust, or other entity or organization (a "Person") or
group of Persons acting in concert as a partnership or other group,
other than a Person controlling, controlled by, or under common
control with Company;
(B) any Person or group of Persons acting in concert as a
partnership or other group, other than a Person controlling,
controlled by, or under common control with Company, acquires
ownership of stock in Company, that together with stock held by such
Person or group, constitutes more than 50 percent of the total fair
market value or total voting power of the stock of Company, provided
such Person or group did not own more than 50 percent of the total
fair market value or total voting power of the stock of Company
prior to such acquisition; or
(C) the replacement of a majority of members of the
Corporation's Board of Directors over any period of one year or less
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.
Notwithstanding anything else to the contrary set forth in this Agreement,
if (i) an agreement is executed by the Corporation or the Company 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 membership on the
Company's Board 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.
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1.1.3 "CORPORATION" means Mid Penn Bancorp, Inc.
1.1.4 "DISABILITY" means the Director's inability to engage in any
substantial gainful activity by reason of any medically determinable
physical or mental impairment that can be expected to result in death or
can be expected to last for a continuous period of not less than twelve
(12) months.
1.1.5 "ELECTION FORM" means the Form attached as Exhibit A.
1.1.6 "FEES" means the total director fees payable to the Director.
1.1.7 "NORMAL BENEFIT AGE" means the Director's 70th birthday.
1.1.8 "NORMAL BENEFIT DATE" means the later of the Normal Benefit
Age or the Director's Termination of Service.
1.1.9 "TERMINATION OF SERVICE" means the Director's ceasing to be a
member of the Company's Board of Directors for any reason other than
death.
ARTICLE 2
ELECTIONS
2.1 DEFERRAL ELECTION. The Director shall make a deferral election under
this Agreement by filing with the Company a signed Election Form. The Election
Form shall set forth the amount of Fees to be deferred. The Election Form shall
be effective to defer only Fees earned in the calendar year following the date
the Election Form is received by the Company and shall be irrevocable as of the
last day of the calendar year preceding the year for which the election is made.
For years after 2006, Fees may be deferred up to a maximum amount of Eight
Thousand Dollars ($8,000.00).
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2.2 DEFERRAL ELECTION CHANGES
2.2.1 GENERALLY. An Election Form on file with the Company shall
remain effective for future years, and shall become irrevocable as of
December 31 of each immediately preceding year, until such time as the
Director changes the deferral election by submitting a new Election Form;
provided, however, that any such change shall not be effective until the
calendar year following the year in which the new Election Form is
received by the Company.
2.2.2 HARDSHIP. In the event of an unforeseeable emergency
constituting a severe financial hardship of the Director or the Director's
beneficiary resulting from an illness or accident of the Director or
beneficiary, the Director's or beneficiary's spouse or the Director's or
beneficiary's dependent (as defined in Code Section 152(a)); loss of the
Director's or beneficiary's property due to casualty; or other similar
extraordinary and unforeseeable circumstances arising as a result of
events beyond the control of the Director or beneficiary, the Director, by
written instructions to the Company, may cancel future deferrals under
this Agreement. Subsequent to such cancellation, the Director may elect to
make additional deferrals under this Agreement upon filing a new Election
Form setting forth the amounts to be deferred; provided, however, that any
such new election will not be effective before the beginning of the year
following the year in which such election is made.
2.3 DISTRIBUTION ELECTIONS. The time at which benefits under this
Agreement will be paid and their manner of distribution are specified below. The
Director may not change the time or manner of benefit payment under this
Agreement without the written approval of the Board of Directors of the Company.
Any change in the time or form of benefit payment (i) may not take effect until
at least 12 months after the date on which an election to make such change is
received in writing by the Company and approved by the Board of Directors; (ii)
in the case of an election related to a payment not attributable to death,
disability or hardship, as provided in this Agreement, must defer payment for a
period of not less than 5 years from the date such payment would otherwise have
been made; and (iii) in the case of any election related
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to a payment based upon a specified time or fixed schedule may not be made less
than 12 months prior to the date of the first scheduled payment. For purposes of
changing the time or form of benefits distribution, if the Director has elected
in this Agreement an installment form of payment, the installments shall be
treated as a single payment occurring on the date of the first installment, and
subject to the other rules for changes in distribution elections as set forth
above, the Director may elect to receive a lump sum payment five years after the
first installment payment would otherwise have been made. Notwithstanding the
foregoing, a Director may, on or before December 31, 2006, make distribution
elections different from those previously made by the Director without regard to
the limitations described in (i), (ii) and (iii) of this Section 2.3; provided,
however, that the Director may not make any election that would have the effect
of deferring payment to a later year of an amount that would otherwise be
payable in 2006 or that would have the effect of causing a payment to be made in
2006 that would otherwise be paid after 2006, and any such purported election by
the Director shall be ineffective. Similarly, a Director may, on or before
December 31, 2007, make distribution elections different from those previously
made by the Director without regard to the limitations described in (i), (ii)
and (iii) of this Section 2.3; provided, however, that the Director may not make
any election that would have the effect of deferring payment to a later year of
an amount that would otherwise be payable in 2007 or that would have the effect
of causing a payment to be made in 2007 that would otherwise be paid after 2007,
and any such purported election by the Director shall be ineffective.
ARTICLE 3
DEFERRAL ACCOUNT
3.1 ESTABLISHING AND CREDITING. The Company shall establish a Deferral
Account on its books for the Director, and shall credit to the Deferral Account
the following amounts:
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. Effective December 31, 2006 interest shall be
compounded semi-annually on the account balance using an annual rate equal
to the 5-year Treasury rate as of the last day of the immediately
preceding calendar year plus two percent (2%).
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3.2 STATEMENT OF ACCOUNTS. The Company shall provide to the Director,
within one hundred twenty (120) days after each anniversary of this Agreement, 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
Company for the payment of benefits. The benefits represent the mere Company
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 TERMINATION BENEFIT. Upon the Director's Termination of Service
on or after attainment of Normal Benefit Age, the Company 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 Director's Termination of Service.
4.1.2 PAYMENT OF BENEFIT. The Company shall pay the benefit to the
Director in [OPTION 1] a lump sum or [OPTION 2] equal monthly installments
over_____ years commencing on the first day of the month following the
Director's Normal Benefit Date. The Company shall continue to credit
interest as described in Section 3.1.2 on the balance of the Deferral
Account until all payments have been distributed.
4.2 EARLY TERMINATION BENEFIT. If the Director terminates service as a
director before the Normal Benefit Age for reasons other than death or
Disability, the Company 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
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Account balance at the Director's Normal Benefit Age. Interest shall be
credited to the account between the Director's date of Termination of
Service and the Director's Normal Benefit Age as specified in Section
3.1.2.
4.2.2 PAYMENT OF BENEFIT. The Company shall pay the benefit to the
Director in [OPTION 1] a lump sum or [OPTION 2] equal monthly installments
over _______ years commencing on the first day of the month following the
Director's Normal Benefit Age. The Company shall continue to credit
interest as described in Section 3.1.2 on the balance of the Deferral
Account until all payments have been distributed.
4.3 DISABILITY BENEFIT. Upon a certification of Disability as defined in
Section 1.1.4 and prior to the Normal Benefit Age, the Company 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 time of certification of Disability.
4.3.2 PAYMENT OF BENEFIT. The Company shall pay the benefit to the
Director in [OPTION 1] a lump sum or [OPTION 2] equal monthly installments
over _______ years commencing on the first day of the month following
certification of the Director's Disability. The Company shall continue to
credit interest as described in Section 3.1.2 on the balance of the
Deferral Account until all payments have been distributed.
4.4 CHANGE IN CONTROL BENEFIT. Upon the Director's Termination of Service
within two years after a Change in Control, the Company 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 of the Director's Termination of
Service.
4.4.2 PAYMENT OF BENEFIT. The Company shall pay the benefit to the
Director in
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[OPTION 1] a lump sum or [OPTION 2] equal monthly installments over
_______ years commencing on the first day of the month following the
Director's Termination of Service. The Company shall continue to credit
interest as described in Section 3.1.2 on the balance of the Deferral
Account until all payments have been distributed.
4.5 HARDSHIP DISTRIBUTION. Upon the Company's determination (following
petition by the Director) that the Director has suffered an unforeseeable
emergency as described in Section 2.2.2, the Company shall distribute to the
Director all or a portion of the Deferral Account balance as determined by the
Company, but in no event shall the distribution amount exceed the amount
reasonably necessary to satisfy the emergency need (which may include amounts
necessary to pay any federal, state or local income taxes or penalties
reasonably anticipated to result from the distribution). A distribution on
account of unforeseeable emergency may not be made to the extent that such
emergency is or may be relieved through reimbursement or compensation from
insurance or otherwise, by liquidation of the Director's assets (to the extent
the liquidation of such assets would not cause severe financial hardship) or by
cessation of deferrals under Section 2.2.2, and determination of the amount
reasonably necessary to satisfy the emergency need shall take into account any
additional compensation available to the Director as a result of a cessation of
deferrals.
4.6 Notwithstanding the foregoing, in the event that the Director is
determined to be a specified employee, as defined in Section 409A, any payment
that is made on account of a separation from service, as defined in Section
409A, shall be delayed to the date that is one day after six months from the
date of the Director's separation from service. In the event that any
installment payments are delayed pursuant to this Section 4.6, such delayed
payments will be accumulated and paid in one lump sum on the delayed payment
date and any remaining payments shall be made in accordance with the otherwise
applicable schedule of payments.
ARTICLE 5
DEATH BENEFITS
5.1 DEATH PRIOR TO COMMENCEMENT OF BENEFIT PAYMENTS. If the Director dies
prior to
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commencement of benefit payments, the Company 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
greater of the Deferral Account balance at the Director's death or Two
Hundred Three Thousand One Hundred Dollars ($203,100).
5.1.2 PAYMENT OF BENEFIT. The Company shall pay the benefit to the
beneficiary in [OPTION 1] a lump sum or [OPTION 2] equal monthly
installments over _______ years commencing on the first day of the month
following the Director's death. The Company shall continue to credit
interest as described in Section 3.1.2 on the balance of the Deferral
Account until all payments have been distributed.
5.2 DEATH DURING BENEFIT PERIOD. If the Director dies after benefit
payments have commenced under this Agreement but before receiving all such
payments, the Company shall pay the remaining benefits to the Director's
beneficiary at the same time and in the same amounts they would have been paid
to the Director had the Director survived.
ARTICLE 6
BENEFICIARIES
6.1. BENEFICIARY DESIGNATIONS. The Director shall designate a beneficiary
by filing a written designation with the Company. The Director may revoke or
modify the designation at any time by filing a new designation. However,
designations will only be effective if signed by the Director and accepted by
the Company during the Director's lifetime. The Director's beneficiary
designation shall be deemed automatically revoked if the beneficiary predeceases
the Director, or if the Director names a spouse as beneficiary and the marriage
is subsequently dissolved. If the Director dies without a valid beneficiary
designation, all payments shall be made to the Director's estate.
6.2 FACILITY OF PAYMENT. If a benefit is payable to a minor, to a person
declared incompetent, or to a person incapable of handling the disposition of
his or her property, the
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Company may pay such benefit to the guardian, legal representative or person
having the care or custody of such minor, incompetent person or incapable
person. The Company may require proof of incompetence, minority or guardianship
as it may deem appropriate prior to distribution of the benefit. Such
distribution shall completely discharge the Company from all liability with
respect to such benefit.
ARTICLE 7
GENERAL LIMITATIONS
Notwithstanding anything in this Agreement to the contrary, all interest
that would otherwise be credited to the Director's Deferral Account balance
subsequent to the Director's Termination of Service or death, as applicable,
shall be forfeited in the following circumstances:
7.1 TERMINATION FOR CAUSE. If the Company terminates the Director's
service as a director for:
7.1.1 Gross negligence or gross neglect of duties;
7.1.2 Commission of a felony or of a gross misdemeanor involving
moral turpitude; or
7.1.3 Fraud, disloyalty, dishonesty or willful violation of any law
or significant Company policy committed in connection with the Director's
service and resulting in an adverse financial effect on the Company.
7.2 SUICIDE. If the Director commits suicide within two years after the
date of this Agreement, or if the Director has made any material misstatement of
fact on any application for life insurance purchased by the Company.
ARTICLE 8
CLAIMS AND REVIEW PROCEDURES
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8.1 CLAIMS PROCEDURE. The Company shall notify any person or entity that
makes a claim for benefits under this Agreement (the "Claimant") in writing,
within ninety (90) days (forty-five (45) days in the case of a claim for
disability benefits) of Claimant's written application for benefits, of
Claimant's eligibility or ineligibility for benefits under the Agreement. If the
Company determines that the Claimant is not eligible for benefits or full
benefits, the notice shall set forth (1) the specific reasons for such denial,
(2) a specific reference to the provisions of the Agreement on which the denial
is based, (3) a description of any additional information or material necessary
for the Claimant to perfect Claimant's claim, and a description of why it is
needed, and (4) an explanation of the Agreement's claims review procedure and
other appropriate information as to the steps to be taken if the Claimant wishes
to have the claim reviewed. If the Company determines that there are special
circumstances requiring additional time to make a decision, the Company shall
notify the Claimant of the special circumstances and the date by which a
decision is expected to be made, and may extend the time for up to an additional
ninety-day period (thirty-day period for disability claims).
8.2 REVIEW PROCEDURE. If the Claimant is determined by the Company not to
be eligible for benefits, or if the Claimant believes that Claimant is entitled
to greater or different benefits, the Claimant shall have the opportunity to
have such claim reviewed by the Company by filing a petition for review with the
Company within sixty (60) days after receipt of the notice issued by the
Company. Said petition shall state the specific reasons which the Claimant
believes entitle Claimant to benefits or to greater or different benefits.
Within sixty (60) days after receipt by the Company of the petition, the Company
shall afford the Claimant (and counsel, if any) an opportunity to present
Claimant's position to the Company orally or in writing, and the Claimant (or
counsel) shall have the right to review the pertinent documents. The Company
shall notify the Claimant of its decision in writing within the sixty-day period
(forty-five (45) days in the case of a claim for disability benefits), stating
specifically the basis of its decision, written in a manner calculated to be
understood by the Claimant and the specific provisions of the Agreement on which
the decision is based. If, because of the need for a hearing, the sixty-day
period is not sufficient, the decision may be deferred for up to another
sixty-day period (forty-five (45) days for disability claims) at the election of
the Company, but notice of this deferral shall be given to the Claimant.
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ARTICLE 9
AMENDMENTS AND TERMINATION
This Agreement may be amended or terminated only by a written agreement
signed by the parties; provided, however, that in the event that this Agreement
is terminated, benefit payments shall be made as though no such termination
occurred unless the termination satisfies the requirements of Section 409A
pertaining to plan terminations allowing a change in the form or timing of
benefit distributions.
ARTICLE 10
MISCELLANEOUS
10.1 BINDING EFFECT. This Agreement shall bind the parties, and their
beneficiaries, survivors, executors, administrators and transferees.
10.2 NO GUARANTEE OF SERVICE. This Agreement is not a contract for
services. It does not give the Director the right to remain a director of the
Company, nor does it interfere with the shareholders' rights to replace the
Director. It also does not require the Director to remain a director nor
interfere with the Director's right to terminate services at any time.
10.3 NON-TRANSFERABILITY. Benefits under this Agreement cannot be sold,
transferred, assigned, pledged, attached or encumbered in any manner.
10.4 TAX WITHHOLDING. The Company shall withhold any taxes that are
required to be withheld from the benefits provided under this Agreement.
10.5 APPLICABLE LAW. The Agreement and all rights hereunder shall be
governed by the laws of the Commonwealth of Pennsylvania, except to the extent
preempted by the laws of the United States of America. The provisions of this
Agreement shall be construed consistent with Section 409A of the Internal
Revenue Code and all applicable guidance thereunder so as not to result in the
inclusion in the Director's income of any benefit under this Agreement by reason
of the application of such section.
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10.6 UNFUNDED ARRANGEMENT. The Director and beneficiary are general
unsecured creditors of the Company for the payment of benefits under this
Agreement. The benefits represent the mere promise by the Company to pay such
benefits. The rights to benefits are not subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance, attachment, or
garnishment by creditors. Any insurance policy on the Director's life obtained
by the Company shall be owned by the Company and shall confer no preferred or
secured claim status to such policy or policy benefits on the Director or
beneficiary.
10.7 REORGANIZATION. The Company shall not merge or consolidate into or
with another company, or reorganize, or sell substantially all of its assets to
another company, firm, or person unless such succeeding or continuing company,
firm, or person agrees to assume and discharge the obligations of the Company
under this Agreement.
10.8 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties as to the subject matter hereof and supersedes all prior
agreements relating to such subject. No rights are granted to the Director by
virtue of this Agreement other than those specifically set forth herein.
10.9 ADMINISTRATION. The Company shall have powers which are necessary to
administer this Agreement, including but not limited to:
10.9.1 Interpreting the provisions of the Agreement;
10.9.2 Establishing and revising the method of accounting for the
Agreement;
10.9.3 Maintaining a record of benefit payments; and
10.9.4 Establishing rules and prescribing any forms necessary or
desirable to administer the Agreement.
IN WITNESS WHEREOF, the Director and a duly authorized Company officer
have signed this Agreement.
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DIRECTOR: COMPANY:
MID PENN BANK
/s/ ▇▇▇▇ ▇▇▇▇▇ By: /s/ [ILLEGIBLE]
------------------------------------ --------------------------------
Title: V. P. Human Resource Officer
By execution hereof, Mid Perm Bancorp, Inc. consents to and agrees to be
bound by the terms and conditions of this Agreement.
ATTEST: CORPORATION:
MID PENN BANCORP, INC.
/s/ [ILLEGIBLE] By: /s/ [ILLEGIBLE]
------------------------------------ --------------------------------
Title: Secretary
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