EX1A-6 MAT CTRCT 18 tm2121584d1_ex6-4.htm EXHIBIT 6.4

 

Exhibit 6.4

 

DEFERRED COMPENSATION AGREEMENT

 

THIS DEFERRED COMPENSATION AGREEMENT (this "Agreement") is made effective as of the1st day of January 2007 by and between THE LYONS NATIONAL BANK, a federally chartered banking organization (the "Company") with its principal offices located at 35 William Street, Lyons, New York 14489, LYONS BANCORP INC., a New York business corporation (the "Holding Company") with its principal offices located at 35 William Street, Lyons, New York 14489, and                                            an individual residing at                                                         (the "Executive").

 

WHEREAS, the Company, Holding Company, and Executive have previously entered into an Employment Agreement and have been operating pursuant to the terms of said Employment Agreement since its inception; and

 

[or, in case of oral agreement, WHEREAS, the Company, Holding Company, and Executive have previously operated under a oral agreement deferring certain compensation for the Executive; and]

 

WHEREAS, the Company, Holding Company, and Executive desire to terminate Executive's Employment Agreement, continue Executive's employment with the Company without a formal written agreement, and enter into a formal written deferred compensation agreement; and

 

WHEREAS, the Company and Holding Company consider the continued availability of the Executive's services, managerial skills and business experience to be in the best interests of the Company and the Holding Company; and

 

WHEREAS, the Company and the Holding Company believe it is imperative to encourage the Executive's full attention and dedication to the Company currently and to provide the Executive with deferred compensation benefits.

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained in this Agreement, the Company and Executive agree as follows:

 

1.             Employment and Termination of Employment. The Executive shall at all times be considered an employee-at-will and, therefore, the Company or the Executive may terminate the employment relationship at any time, with or without cause, with or without notice. Upon termination of employment by the Company or by the Executive, Executive shall immediately resign from any position he may then hold on the Board of Directors of the Company or Holding Company or any office he may then hold with the Company or Holding Company. Resignation from the Board of Directors or as an officer shall be deemed effective immediately upon the termination of Executive's employment with the Company, without the requirement that a written resignation be delivered.

 

2.             Confidential Information. The Executive shall hold in a fiduciary capacity for the benefit of the Company and its affiliated companies all secret or confidential information, and all 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 or data to anyone other than the Company and those designated by it.

 

 

 

 

3.             Deferred Compensation Payments. During the Executive's period of employment with the Company following execution of this Agreement, the Company shall make an annual payment to a separate account maintained for the Executive. The annual payment to Executive shall be Ten Thousand Dollars ($10,000) (the "Payment"). The Payment shall be invested in the common stock of the Holding Company. If a dividend is paid on the shares credited to the Executive's separate account, the Executive's separate account shall be credited with such dividend (the "Dividend", which together with the Payment, shall hereinafter be referred to as the "Benefit"), which dividend shall be reinvested in the common stock of the Holding Company, except that no fractional shares shall be credited to the Executive's separate account. The price per share for all shares of the Holding Company purchased by the Company for the benefit of Executive shall be the average of the daily closing price of the stock for each day within the past quarter. The closing price on Fridays will be used to determine the closing price for Saturdays and Sundays and the closing price on the last business day before a holiday that results in the closure of the financial markets will be used to determine the closing price for that holiday.

 

4.             Vesting and Distribution.

 

A.            The Benefit shall vest according to the vesting schedule set forth in subparagraph B of this Paragraph 4. If the Executive shall be terminated by the Employer for Cause (as hereinafter defined), the Executive shall not be entitled to receive any of the Benefit. If the Executive is terminated by the Company for any reason other than for Cause, the Benefit shall immediately vest. If the Executive terminates his employment for any reason whatsoever before the Benefit fully vests (according to the vesting schedule set forth in subparagraph B of this Paragraph 4), the Executive shall only be entitled to a distribution of the amount of the Benefit that has vested as of the date of his separation from service.

 

B.             The Benefit shall vest as follows: (1) on December 31, 2007, 50% of all of the Benefit credited to the Executive's account during the 2007 calendar year shall vest with the Executive; (2) on December 31, 2008, 75% of all of the Benefit credited to the Executive's account during the 2007 and 2008 calendar years shall vest with the Executive; (3) on December 31, 2009, 100% of the Benefit credited to the Executive's account during the 2007, 2008, and 2009 calendar years shall vest with the Executive; and (4) all of the Benefit credited to the Executive's account subsequent to December 31, 2009 shall immediately vest with the Executive.

 

C.             The term Cause shall mean:

 

(1)       Executive's repeated violation of his obligations of employment (other than as a result of incapacity due to physical or mental illness) which are demonstrably willful and deliberate on the Executive's part, which are committed in bad faith or without reasonable belief that said violations are in the best interests of the Holding Company and the Company, and which are not remedied in a reasonable period of time after receipt of written notice from the Holding Company and/or the Company specifying such violations. In establishing a termination for cause under this subparagraph (1), it shall be incumbent upon the Holding Company or the Company to establish that the conduct constituted either (a) a violation of a written policy (including but not limited to a violation of paragraph 2, Confidential Information, of this Agreement) or (b) a violation of a prior oral or written communication to the Executive regarding the Executive's conduct or duties; or

 

 

 

 

(2)       the conviction of the Executive of a felony.

 

D.            The Executive shall be entitled to receive distribution of the Benefit upon the earlier of the following:

 

(1)       The death of the Executive;

(2)       The separation from service of the Executive;

(3)       A "change in the ownership" (as hereinafter defined) of the Holding Company; or

(4)       A "change in the effective control" (as hereinafter defined) of the Holding Company; or

(5)       A "change in the ownership of a substantial portion of the assets" of the Holding Company; or

(6)       The Executive becoming "disabled" (as hereinafter defined); or

(7)       The occurrence of an "unforeseeable emergency" (as hereinafter defmed).

 

Together subparagraphs (3) through (5) shall be referred to as a "Change of Control". Together, subparagraphs (1) through (7) shall be referred to hereinafter as the "Distribution Events", or singly, a "Distribution Event".

 

E.             For purposes of this Agreement, a "change in the ownership" of the Holding Company occurs on the date that any one person, or more than one person acting as a group (as such term is defined in Treas. Reg. § 1.409A-3(i)(5)(v)(B)) acquires ownership of stock of the Holding Company, that together with stock held by such person or group of persons, constitutes more than fifty percent (50%) of the total fair market value or fifty percent (50%) of the total voting power of the stock of the Holding Company.

 

F.             For purposes of this Agreement, a "change in the effective control" of the Holding Company occurs only on the date that either: (1) any one person, or more than one person acting as a group (as such term is defined in Treas. Reg. § 1.409A-3(i)(5)(v)(B)), 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 Holding Company possessing thirty percent (30%) or more of the total voting power of the stock of the Holding Company; or (2) a majority of members of the Holding Company's Board of Directors is replaced during a 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board of Directors prior to the date of the appointment or election.

 

G.             For purposes of this Agreement, a "change in the ownership of a substantial portion of the assets" of the Holding Company occurs on the date that any one person, or more than one person acting as a group (as such term is defined in Treas. Reg. § 1.409A-3(i)(5)(v)(B)), acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) assets from the Holding Company that have a total gross fair market value equal to or more than forty percent (40%) of the total gross fair market value of all assets of the Holding Company immediately prior to such acquisition or acquisitions. For purposes of this paragraph, gross fair market value means the value of the assets of the Holding Company, or the value of the assets being disposed of, determined without regard to any liabilities associated with such assets.

 

 

 

 

H.           For purposes of this Agreement, the Executive is considered "disabled" if he or she meets one of the following requirements:

 

(1)       The Executive is unable 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 12 months.

 

(2)       The Executive is, 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 12 months, receiving income replacement benefits for a period of not less than three months under an accident and health plan covering employees of the Executive's employer.

 

I.              For purposes of this Agreement, an "unforeseeable emergency" is a severe financial hardship of the Executive resulting from an illness or accident of the Executive, the Executive's spouse, or the Executive's dependent; loss of the Executive's property due to casualty; or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Executive. A distribution on account of an 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 Executive's assets, to the extent the liquidation of such assets would not cause severe financial hardship, or by cessation of deferrals under this Agreement. Distributions due to an unforeseeable emergency must be limited to the amount reasonably necessary to satisfy the emergency need.

 

J.             Distribution.

 

(1)       The Benefit shall be distributed to the Executive in substantially equal annual payments of the common stock of the Holding Company that have been credited to the Executive's separate account over a period of 1 years. The first annual payment of the Benefit shall be distributed to the Executive or his beneficiary on the first day of the month following the Distribution Event, but in no case in less than fifteen (15) days following a Distribution Event. All other annual payments shall be made January 10 of the following 1 years.

 

(2)       Notwithstanding the foregoing, if the Executive is or becomes a "specified employee", distribution shall not be made before the date which is six (6) months after the Distribution Event. A specified employee is a key employee (as defined in section 4I6(i) of the Internal Revenue Code without regard to paragraph (5) thereof) of the Company or the Holding Company which is publicly traded on an established securities market or otherwise.

 

5.             Failure Delay or Waiver. No course of action or failure to act by the Company, the Holding Company or the Executive shall constitute a waiver by the Company, the Holding Company or the Executive, as applicable, of any right or remedy under this Agreement, and no waiver by the Company or the Executive of any right or remedy under this Agreement shall be effective unless made in writing.

 

 

 

 

6.             Partial Invalidity and Severability. Whenever possible, this Agreement and each provision, paragraph, subparagraph and any other portion hereof shall be interpreted in such manner as to be legally effective, valid and enforceable, but if this Agreement or any provision, paragraph, subparagraph or any other portion hereof is adjudged by a court of competent jurisdiction to be void or unenforceable, in whole or in part, for any reason whatsoever, any such provision, paragraph, subparagraph or any other portion of this Agreement adjudged to be unenforceable shall be severed, but only to the extent necessary to make enforceable the otherwise unenforceable Agreement, provision, paragraph, subparagraph, or any other portion of this Agreement.

 

7.             Internal Revenue Code Section 409A. This Agreement is intended to comply with Internal Revenue Code Section 409A and the regulations promulgated thereunder. If any portion of this Agreement is found to not comply with said Code section and regulations, this Agreement shall be modified so as to comply.

 

8.             Notices. Any notice provided for in this Agreement must be in writing and must be either (i) personally delivered, (ii) mailed by registered or certified first class mail, prepaid with return receipt requested, or (iii) sent by a nationally recognized overnight courier service, to the recipient at the address below indicated:

 

  to the Holding Company      
  or to the Company: The Lyons National Bank
    35 William Street
    Lyons, New York 14489
    Attn: Chairman of the Compensation Committee of
    the Board of Directors
         
  to the Executive:      
         
         

 

or such other address or to the attention of such other person as the recipient party shall have specified by prior written notice to the sending party. Any notice under this Agreement will be deemed to have been given (a) on the date such notice is personally delivered, (b) three (3) days after the date of mailing if sent by certified or registered mail, or (c) the next succeeding business day after the date such notice is delivered to the overnight courier service if sent by overnight courier.

 

9.             Consent to Jurisdiction.

 

A.            Executive hereby irrevocably submits to the nonexclusive jurisdiction of any United States federal or New York state court sitting in Wayne County, New York, in any action or proceeding arising out of or relating to this Agreement. Executive hereby irrevocably agrees that all claims in respect of such action or proceeding may be heard and determined in any such court and irrevocably waives any objection he may now or hereafter have as to personal jurisdiction, the venue of any such action or proceeding brought in such a court or the fact that such court is an inconvenient forum.

 

 

 

 

Executive irrevocably and unconditionally consents to the service of process in any such action or proceeding in any of the aforesaid courts by the mailing of copies of such process to it, by certified mail, return receipt requested at its address set forth in paragraph 8 of this Agreement.

 

10.           Entire Agreement. There are no oral agreements in connection with this Agreement. This Agreement constitutes the entire agreement of the parties hereto and supersedes any prior agreements or understandings, whether oral or written, between the parties hereto with respect to the subject matter hereof, specifically including, but not limited to the Employment Agreement. This Agreement may not be terminated, modified or amended orally or by any course of conduct or usage of trade but only by an agreement in writing duly executed by the parties hereto.

 

11.           Prior Employment Agreement. This Agreement terminates any and all prior Employment Agreements entered into by and between the Executive and the Company and/or the Holding Company.

 

12.           Amendments. Any provision of this Agreement may be amended if and only if such amendment is in writing and signed by all parties hereto, and such amendment does not violate Internal Revenue Code Section 409A and the regulations promulgated thereunder.

 

13.           Governing Law. This Agreement shall be construed in accordance with and governed by the internal domestic laws of the State of New York without regard to principles of conflicts of laws.

 

14.           Non-Assignability.. This Agreement is personal to the Executive and may not be assigned by him.

 

15.           Binding Effect. This Agreement shall be binding upon and inure to the benefit of the parties and their respective heirs, legal representatives, successors and permitted assigns.

 

16.           WAIVER OF JURY TRIAL. THE EXECUTIVE, THE HOLDING COMPANY AND THE COMPANY HEREBY WAIVE TRIAL BY JURY IN ANY ACTION OR PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE), IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH THIS AGREEMENT.

 

17.           Paragraph Headings. Headings and subheadings herein are for convenience of reference only and are not of substantive effect.

 

 

 

 

IN WITNESS WHEREOF, The Company and the Executive have executed this Agreement as of the date first above written, as conclusive evidence of their acceptance of the terms and conditions of this Agreement.

 

COMPANY: THE LYONS NATIONAL BANK
       
  By: /s/ James E. Santelli  
  Name: James E. Santelli  
  Title: Chair Compensation Committee
       
HOLDING COMPANY: LYONS BANCORP, INC.
       
  By: /s/ James E. Santelli  
  Name: James E. Santelli  
  Title: Chair Compensation Committee
       
EXECUTIVE:      

 

 

 

  

AMENDMENT

To the Deferred Compensation Agreement for:                                                      

 

THIS AMENDMENT, made and entered into this 1st day of January 2014, by and between The Lyons National Bank, a bank organized and existing under the laws of the United States of America (hereinafter referred to as the "Bank"), and                                                       , an Executive of the Bank (hereinafter referred to as the "Executive"), shall effectively amend the Lyons National Bank Deferred Compensation Agreement effective January 1, 2014 (hereinafter referred to as the "Agreement") as specifically set forth herein. Pursuant to number three (3) of the Agreement (page #2), the Bank and the Executive herby adopt the following:

 

In December of 2013, the Compensation Committee of the Board of Directors approved to increase the annual Deferred Compensation payment to the Executive from Ten Thousand Dollars ($10,000) to Fifteen Thousand Dollars ($15,000) to be effective January 1, 2014.

 

Number three (3) of the Agreement shall now read:

 

Deferred Compensation Payments - During the Executive's period of employment with the Company following execution of this Agreement, the Company shall make an annual payment to a separate account maintained for the Executive. The annual payment to Executive shall be Fifteen Thousand Dollars ($15.000) (the "Payment"). The Payment shall be invested in the common stock of the Holding Company. If a dividend is paid on the shares credited to the Executive's separate account, the Executive's separate account shall be credited with such dividend (the "Dividend", which together with the Payment, shall hereinafter be referred to as the "Benefit"), which dividend shall be reinvested in the common stock of the Holding Company, except that no fractional shares shall be credited to the Executive's separate account. The price per share for all shares of the Holding Company purchased by the Company for the benefit of Executive shall be the average of the daily closing price of the stock for each day within the past quarter. The closing price on Fridays will be used to determine the closing price for Saturdays and Sundays and the closing price on the last business day before a holiday that results in the closure of the financial markets will be used to determine the closing price for that holiday.

 

This Amendment shall be effective the 1st day of January 2014. To the extent that any term, provision, or paragraph of the Agreement is not specifically amended herein, or in any other amendment thereto, said term, provision, or paragraph shall remain in full force and effect as set forth in said Agreement.

 

 

 

 

IN WITNESS WHEREOF, the parties hereto acknowledge that each has carefully read this Amendment and executed the original thereof on the first day set forth hereinabove, and that upon execution, each has received a conforming copy.

 

COMPANY: THE LYONS NATIONAL BANK
  Lyons, New York
       
  By: /s/ James E. Santelli  
  Name: James E. Santelli  
  Title: Chair Compensation Committee  
       
HOLDING COMPANY: LYONS BANCORP, INC.  
       
  By: /s/ James E. Santelli  
  Name: James E. Santelli  
  Title: Chair Compensation Committee  
       
EXECUTIVE:      

 

 

 

  

AMENDMENT

To the Deferred Compensation Agreement for:                                

 

THIS AMENDMENT, made and entered into this 1st day of January 2016, by and between The Lyons National Bank, a bank organized and existing under the laws of the United States of America (hereinafter referred to as the "Bank"), and                             , an Executive of the Bank (hereinafter referred to as the "Executive"), shall effectively amend the Lyons National Bank Deferred Compensation Agreement effective January 1, 2016 (hereinafter referred to as the "Agreement") as specifically set forth herein. Pursuant to number three (3) of the Agreement (page #2), the Bank and the Executive herby adopt the following:

 

In December of 2015, the Compensation Committee of the Board of Directors approved to increase the annual Deferred Compensation payment to the Executive from $                 to $                    to be effective January 1, 2016.

 

Number three (3) of the Agreement shall now read:

 

Deferred Compensation Payments - During the Executive's period of employment with the Company following execution of this Agreement, the Company shall make an annual payment to a separate account maintained for the Executive. The annual payment to Executive shall be Twenty Thousand Dollars ($20,000) (the "Payment"). The Payment shall be invested in the common stock of the Holding Company. If a dividend is paid on the shares credited to the Executive's separate account, the Executive's separate account shall be credited with such dividend (the "Dividend", which together with the Payment, shall hereinafter be referred to as the "Benefit"), which dividend shall be reinvested in the common stock of the Holding Company, except that no fractional shares shall be credited to the Executive's separate account. The price per share for all shares of the Holding Company purchased by the Company for the benefit of Executive shall be the average of the daily closing price of the stock for each day within the past quarter. The closing price on Fridays will be used to determine the closing price for Saturdays and Sundays and the closing price on the last business day before a holiday that results in the closure of the financial markets will be used to determine the closing price for that holiday.

 

This Amendment shall be effective the 1st day of January 2016. To the extent that any term, provision, or paragraph of the Agreement is not specifically amended herein, or in any other amendment thereto, said term, provision, or paragraph shall remain in full force and effect as set forth in said Agreement.

 

 

 

 

IN WITNESS WHEREOF, the parties hereto acknowledge that each has carefully read this Amendment and executed the original thereof on the first day set forth hereinabove, and that upon execution, each has received a conforming copy.

 

COMPANY: THE LYONS NATIONAL BANK
  Lyons, New York
       
  By: /s/ James E. Santelli  
  Name: James E. Santelli  
  Title: Chair Compensation Committee  
       
HOLDING COMPANY: LYONS BANCORP, INC.
       
  By: /s/ James E. Santelli  
  Name: James E. Santelli  
  Title: Chair Compensation Committee  
       
EXECUTIVE:      

 

 

 

 

AMENDMENT TO DEFERRED COMPENSATION AGREEMENT

 

This Amendment to Deferred Compensation Agreement (“Amendment”) is dated the 1st day of May, 2019 (the “Effective Date”), by and among THE LYONS NATIONAL BANK, a federally chartered banking organization (the “Company”) with its principal offices located at 35 William Street, Lyons, New York 14489, LYONS BANCORP INC., a New York business corporation (the “Holding Company”) with its principal offices located at 35 William Street, Lyons, New York 14489, and                                          , an individual residing at ___________________ (the “Executive”).

 

RECITALS

 

A.            The Company, the Holding Company and the Executive are parties to that certain Deferred Compensation Agreement dated as of January 1, 2007, as subsequently amended periodically between 2007 and 2019 to increase the annual Payment made to the Executive’s separate account (collectively, the “Agreement”).

 

B.            The parties hereto desire to amend the Agreement on the terms and subject to the conditions set forth herein.

 

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

 

1.             Capitalized terms used herein and not defined herein shall have the respective meanings given to such terms in the Agreement.

 

2.             The annual Payments for 2017 and 2018 have not yet been invested in common stock of the Holding Company as provided in Section 3 of the Agreement. The Company and the Holding Company have now adopted the 2019 Deferred Compensation Plan as of the Effective Date ("2019 Plan"). Notwithstanding Section 3 of the Agreement, Payments for 2017 and 2018 and any Payments made in 2019 by the Company before the Effective Date shall be invested in "Stock Units" authorized under the 2019 Plan (as defined therein). Article IV of the 2019 Plan, "Contributions and Adjustments," shall apply to the terms of said Stock Units but the remaining terms shall be governed by the terms of this Agreement, as amended from time to time. Investment of said Payments in Stock Units shall be in lieu of any investment in common stock of the Holding Company and in full satisfaction of the obligations to Executive under this Agreement for 2017, 2018 and 2019 before the Effective Date. In the event of any conflict between the terms of this Agreement and the 2019 Plan with respect to the Payments to Executive for 2017, 2018 and 2019 before the Effective Date, the terms of this Agreement shall apply. Notwithstanding the foregoing, the Benefit set forth in the Agreement shall be distributed out in accordance with Subsection 4.J of the Agreement.

 

3.             Executive is a "Participant" under the 2019 Plan (as defined therein). Effective as of the Effective Date, the Company shall no longer have any further obligation to make any Payments to the Executive’s separate account maintained for the Executive as set forth under Section 3 of the Agreement and Executive shall not be entitled to receive any Payments under the Agreement, except for the crediting of Dividends or Dividend Equivalent Amounts (as defined in the 2019 Plan).

 

 

 

 

4.             Except as provided herein, all other provisions, terms and conditions of the Agreement shall remain in full force and effect. As amended hereby, the Agreement is ratified and confirmed in all respects.

 

5.             This Amendment may be executed in counterparts, each of which shall constitute one agreement.

 

IN WITNESS WHEREOF, the parties have executed this Amendment as of the Effective Date.

 

  THE LYONS NATIONAL BANK      
           
  By: /s/ Dale H. Hemminger      
  Name: Dale H. Hemminger      
  Title: Chair, Compensation Committee      
           
  LYONS BANCORP, INC.      
           
  By: /s/ Dale H. Hemminger      
  Name: Dale H. Hemminger      
  Title: Chair, Compensation Committee      
           
  EXECUTIVE      
           

 

 

 

 

AMENDMENT TO

DEFERRED COMPENSATION AGREEMENT

 

This Amendment to Deferred Compensation Agreement (“Amendment”) is made this 1st day of May, 2019 to be effective as of the 1st day of May, 2020 (the “Effective Date”), by and among THE LYONS NATIONAL BANK, a federally chartered banking organization (the “Company”) with its principal offices located at 35 William Street, Lyons, New York 14489, LYONS BANCORP INC., a New York business corporation (the “Holding Company”) with its principal offices located at 35 William Street, Lyons, New York 14489, and                                            , an individual residing at                                         (the “Executive”).

 

RECITALS

 

A.            The Company, the Holding Company and the Executive are parties to that certain Deferred Compensation Agreement dated as of January 1, 2007, as subsequently amended periodically between 2007 and 2019 to increase the annual Payment made to the Executive’s separate account and as amended by that certain amendment dated as of even date herewith, (collectively, the “Agreement”).

 

B.            The parties hereto desire to amend the Agreement to be compliant with Section 409A of Internal Revenue Code of 1986, as amended (the “Code”) on the terms and subject to the conditions set forth herein.

 

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

 

1.             Capitalized terms used herein and not defined herein shall have the respective meanings given to such terms in the Agreement.

 

2.             Effective as of the Effective Date, Subsection 4.D of the Agreement is hereby deleted in its entirety and replaced with the following:

 

D.       The Executive shall be entitled to receive distribution of the Benefit upon the earlier of the following:

 

(1)       The death of the Executive;

 

(2)       The separation from service of the Executive from the Company;

 

(3)       a “change in the ownership” (as hereinafter defined) of the Holding Company; or

 

(4)       a “change in the ownership of a substantial portion of the assets” of the Holding Company; or

 

(5)       The consummation of a merger or consolidation of the Holding Company with any other corporation; provided, however, a Change in Control shall not be deemed to have occurred if such merger or consolidation would result in all or a portion of the voting securities of the Holding Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) either directly or indirectly more than 50% of the combined voting power of the voting securities of the Holding Company or such surviving entity outstanding immediately after such merger or consolidation.

 

 

 

 

(6)       The Executive becoming “disabled” (as hereinafter defined); or

 

(7)       The occurrence of an “unforeseeable emergency” (as hereinafter defined).

 

Together subparagraphs (3), (4) and (5) shall be referred to as a “Change of Control”. Together, subparagraphs (1) through (7) shall be referred to hereinafter as the “Distribution Events”, or singly, a “Distribution Event”.

 

4.             Effective as of the Effective Date, Subsection 4.F of the Agreement is hereby deleted in its entirety.

 

5.             Effective as of the Effective Date Subsection 4.G is hereby deleted in its entirety and replaced with the following:

 

G.             For purposes of this Agreement, a “change in the ownership of a substantial portion of the assets” of the Holding Company occurs on the date that any one person, or more than one person acting as a group (as such term is defined in Treas. Reg. § 1.409A-3(i)(5)(v)(B)), acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) assets from the Holding Company that have a total gross fair market value equal to or more than fifty percent (50%) of the total gross fair market value of all assets of the Holding Company immediately prior to such acquisition or acquisitions. For purposes of this paragraph, gross fair market value means the value of the assets of the Holding Company, or the value of the assets being disposed of, determined without regard to any liabilities associated with such assets.

 

6.             This Amendment is intended to comply with the subsequent deferral election rules under Treasury Regulation Section 1.409A-2(b). Notwithstanding anything contrary in the Agreement, (i) this amendment shall take effect one year from the signing of this Amendment; (ii) any payment that is required by Treasury Regulation Section 1.409A-2(b)(1)(ii) to be delayed by five years as result of this Amendment, including, but not limited, to a Change in Control event, shall be delayed by five years from the date it otherwise would have been distributed under the Agreement, unless the Agreement is terminated by irrevocable action by the Company within thirty (30) days prior or 12 months following a Change in Control event pursuant to Treasury Regulation Section 1.409A-3(j)(4)(ix); and (iii) this Amendment is being made more than 12 months prior to any payment described in Treasury Regulation Section 1.409A-3(a)(4) is scheduled to be paid. Notwithstanding the foregoing, the parties intend that this Amendment only affects the distribution of Company stock upon a Change in Control and not any other payment event described in Treasury Regulation Section 1.409A-3(a). This determination is made in accordance with Treasury Regulation Section 1.409A-2(b)(6). Therefore, no distribution of stock upon an Executive having a Separation from Service shall be required to be delayed by five years as set forth in Treasury Regulation Section 1.409A-2(b)(1)(ii).

 

7.             Except as provided herein, all other provisions, terms and conditions of the Agreement shall remain in full force and effect. As amended hereby, the Agreement is ratified and confirmed in all respects.

 

 

 

 

8.             This Amendment may be executed in counterparts, each of which shall constitute one agreement.

 

 

[Signature page follows]

 

 

 

 

IN WITNESS WHEREOF, the parties have executed this Amendment on this 1st day of May, 2019 to be effective as of the Effective Date.

 

  THE LYONS NATIONAL BANK  
       
  By: /s/ Dale H. Hemminger  
  Name: Dale H. Hemminger  
  Title: Chair, Compensation Committee  
       
  LYONS BANCORP, INC.  
       
       
  By: /s/ Dale H. Hemminger  
  Name: Dale H. Hemminger  
  Title: Chair, Compensation Committee  
       
  EXECUTIVE  
       

 

 

 

 

FOURTH AMENDMENT TO DEFERRED COMPENSATION AGREEMENT

 

This Fourth Amendment to Deferred Compensation Agreement (“Amendment”) is dated the 13th day of November, 2019 (the “Effective Date”), by and among THE LYONS NATIONAL BANK, a federally chartered banking organization (the “Company”) with its principal offices located at 35 William Street, Lyons, New York 14489, LYONS BANCORP INC., a New York business corporation (the “Holding Company”) with its principal offices located at 35 William Street, Lyons, New York 14489, and , an individual residing at (the “Executive”).

 

RECITALS

 

A.            The Company, the Holding Company and the Executive are parties to that certain Deferred Compensation Agreement dated as of January 1, 2007, as subsequently amended effective as of March 1, 2013, May 1, 2019, and May 1, 2020 (collectively, the “Agreement”).

 

B.            Due to banking regulations, the parties hereto desire to amend the Agreement on the terms and subject to the conditions set forth herein.

 

PROVISIONS

 

NOW THEREFORE, the parties hereby agree as follows:

 

1.             Section 3 of the Agreement entitled “Deferred Compensation Payments” shall be amended and restated in its entirety as follows:

 

3.             Deferred Compensation Payments. During the Executive's period of employment with the Company following execution of this Agreement, the Company shall make an annual payment to a separate account maintained for the Executive. The annual payment to Executive shall be Fifty Thousand Dollars ($50,000) (the “Payment”). The Payment may be invested in the common stock of the Holding Company or in stock units whereby each unit represents the right to receive one share of common stock of the Holding Company (a “Stock Unit”). If the Payment is so invested and the Holding Company declares a dividend on its shares, then on the payment date of the dividend the Executive's separate account shall be credited with an amount equal to the dividends that would have been paid to the Executive if the common stock credited to the account or underlying the Stock Units had been granted to the Executive (the “Dividend,” which together with the Payment, shall hereinafter be referred to as the “Benefit”). The Dividend may be reinvested in the common stock or Stock Units of the Holding Company. The price per share for all shares of the Holding Company purchased or underlying any Stock Units shall be the average of the daily closing price of the stock for each day within the past quarter. The closing price on Fridays will be used to determine the closing price for Saturdays and Sundays and the closing price on the last business day before a holiday that results in the closure of the financial markets will be used to determine the closing price for that holiday. Any investment or reinvestment of all or any portion of the Benefit in shares of common stock or Stock Units shall reduce the number of shares of common stock reserved for future awards of Stock Units under the 2019 Plan.

 

2.             The Board has duly approved this Amendment.

 

 

 

 

3.             Except as provided herein, all other provisions, terms and conditions of the Agreement shall remain in full force and effect. As amended hereby, the Agreement is ratified and confirmed in all respects.

 

4.             This Amendment may be executed in counterparts, each of which shall constitute one agreement.

 

IN WITNESS WHEREOF, the parties have executed this Amendment as of the Effective Date.

 

  THE LYONS NATIONAL BANK  
       
  By: /s/ Dale H. Hemminger  
  Name: Dale H. Hemminger  
  Title: Chair, Compensation Committee  
       
  LYONS BANCORP, INC.  
       
  By: /s/ Dale H. Hemminger  
  Name: Dale H. Hemminger  
  Title: Chair, Compensation Committee  
       
  EXECUTIVE  
       

 

 

 

  

SCHEDULE TO EXHIBIT 6.4

 

FORM OF DEFERRED COMPENSATION AGREEMENT AND AMENDMENTS BY AND AMONG THE LYONS NATIONAL BANK AND CERTAIN EXECUTIVES

 

The Deferred Compensation Agreement and amendments attached as Exhibit 6.4 are substantially identical in all material respects to the Deferred Compensation Agreements entered into by the Lyons National Bank, Lyons Bancorp Inc. and the following executive officers, except as follows:

 

Name   Annual Payment   Section 4.J Distribution
         
Clair J. Britt, Jr. $20,000   Over 5 year
         
Stephen V. DeRaddo   $20,000   Over 5 year
         
Thomas L. Kime   $25,000   Over 5 year
         
Robert A. Schick   $50,000   Over 10 years