Exhibit 10.1
POST-EMPLOYMENT AGREEMENT

This POST-EMPLOYMENT AGREEMENT (the “Agreement”) is made and entered into on the
27th day of December 2007, by and between ERIE INDEMNITY COMPANY, a Pennsylvania
corporation with its principal place of business in Erie, Pennsylvania (the
“Company”), and JEFFREY A. LUDROF, residing in Fairview, Pennsylvania (the
“Executive”).

RECITALS:

WHEREAS, the Company and the Executive are parties to an Amended and Restated
Employment Agreement made effective as of December 12, 2005 (the “Employment
Agreement”); and

WHEREAS, on August 1, 2007, the Executive tendered his resignation, which was
effective as of August 8, 2007, as an officer and director of the Company and
each of its subsidiaries and related companies, and as a trustee of any employee
benefit trusts or other trusts maintained or sponsored by the Company and each
of its subsidiaries and related companies, and the Company and each of its
subsidiaries and related companies accepted such resignations effective as of
August 8, 2007; and

WHEREAS, the Company and the Executive entered into a Letter of Understanding
effective as of August 1, 2007 (the “Letter of Understanding”), which set forth
the parties’ understanding as to the fundamental terms to be memorialized in
this Agreement; and

WHEREAS, the Company and the Executive desire to memorialize the terms of the
Executive’s termination of employment in this Agreement and completely resolve
all matters arising out of the Executive’s employment with the Company or the
termination of that employment, as well as all matters arising out of or related
to the Employment Agreement.

NOW, THEREFORE, in consideration of the premises and mutual covenants contained
herein, and intending to be legally bound hereby, the parties hereto agree as
follows:

1. Effective Date. This Agreement shall not become effective or enforceable
until the seven (7) day revocation period described in Section 5(f) of this
Agreement has expired (the “Effective Date”) and none of the payments or
benefits described in this Agreement shall be provided to the Executive until
after the revocation period has expired without the Executive having revoked
this Agreement.

2. Termination of the Employment Agreement. The Executive and the Company hereby
mutually terminate, revoke and rescind the Employment Agreement and all rights
and obligations either party has or may be entitled to under the Employment
Agreement, in accordance with Section 5(h) of the Employment Agreement. The
Executive and the Company agree further that the Executive’s employment with the
Company was terminated effective as of August 8, 2007.

3. Consideration.

a. In consideration of the execution and performance of this Agreement by the
Executive, and subject to the remaining provisions of this Section 3, the
Executive will receive from the Company the following severance payments and
benefits, which include sums of money and benefits to which the Executive would
not otherwise be entitled if the Company and the Executive did not mutually
agree to the termination of his Employment Agreement:

i. The Company shall pay to the Executive, in a lump sum cash payment on
December 31, 2007, the sum of Four Million Five Hundred Forty-Three Thousand
Nine Hundred Dollars ($4,543,900).

ii. The Company shall pay to the Executive, in a lump sum cash payment on
April 1, 2008, the sum of Three Million Forty Thousand Nine Hundred Dollars
($3,040,900) in substitution for and in settlement of the Executive’s Accrued
SERP Benefit (as such term is defined in the Employment Agreement) and any other
benefit under or related to the Supplemental Executive Retirement Plan for
Certain Members of the Erie Insurance Group Retirement Plan for Employees
(“SERP”) in which Executive may have had an expectancy.

iii. On April 1, 2008, or within seven (7) days after that date, the Company
shall pay to the appropriate taxing authorities on the Executive’s behalf a Tax
Gross-up with respect to the payment described in paragraph (ii). As used
throughout this Agreement, the “Tax Gross-up” with respect to a particular
payment or benefit means the taxes identified below that are payable by the
Executive by reason of such payment or benefit, computed by applying the highest
applicable marginal rate with respect to each such tax:

  1.   Federal income tax applicable to the Executive for the year of payment
under section 1 of the Code;

  2.   Pennsylvania state income tax;

  3.   Pennsylvania local income tax

  4.   The employee portion of the Pennsylvania unemployment tax; and

  5.   The employee portion of FICA-HI taxes.

As used in this Agreement, the “appropriate taxing authorities” means the United
States Treasury, the Commonwealth of Pennsylvania Department of Revenue and the
City of Erie and/or Fairview Township, Pennsylvania, as applicable. Any Tax
Gross-up payable under this Agreement shall be paid during the year in which the
related payment or benefit is paid.

iv. The Company shall pay to the Executive, in a lump sum cash payment on or
about January 15, 2008, an amount equal to the Executive’s account balance under
the Deferred Compensation Plan of Erie Indemnity Company (the “Deferred
Compensation Plan”) as of December 31, 2004, plus earnings on that portion of
the Executive’s account through the date of payment, computed in accordance with
the terms of the Deferred Compensation Plan.

The Company shall pay to the Executive, in a lump sum cash payment on April 1,
2008, an amount equal to the Executive’s account under the Deferred Compensation
Plan attributable to accruals on and after January 1, 2005, and earnings on that
portion of the Executive’s account through the date of payment, computed in
accordance with the terms of the Deferred Compensation Plan.

v. The Company shall issue 7,556 shares of the Company’s Class A Common Stock
(less applicable deductions) to the Executive in January 2008, and 3,593 shares
of the Company’s Class A Common Stock (less applicable deductions) to the
Executive in January 2009, which shares represent restricted shares awarded to
Executive under the Company’s 1997 Long Term Incentive Plan.

vi. With respect to the Company’s 2004 Long Term Incentive Plan (“2004 LTIP”),
(A) the performance period with respect to awards made to the Executive for the
2005-2007, 2006-2008, and 2007-2009 performance periods shall all be treated as
ending on December 31, 2007; (B) the Company shall measure Company performance
for each such performance period against the applicable performance standards
and goals and shall determine the number of the restricted performance shares
earned by the Executive for the performance period, based on such Company
performance (the “earned award”); and (C) the Company shall issue to the
Executive shares of the Company’s Class A Common Stock representing: (1) for the
2005-2007 performance period, 100 percent of the earned award, (2) for the
2006-2008 performance period, 2/3 of the earned award and (3) for the 2007-2009
performance period, 7/36 of the earned award (less, in each case, applicable
deductions). The Company shall issue such shares in 2008 at the time awards for
the 2005-2007 performance period are paid to other 2004 LTIP participants. The
Company’s determination of the number of shares to be issued shall be final and
binding on all interested parties.

vii. For each of the calendar years 2008, 2009 and 2010, the Company shall
reimburse the Executive for the annual premiums due and paid during such years
(i.e., in 2008 for the 2008-2009 policy year, in 2009 for the 2009-2010 policy
year, and in 2010 for the 2010 -2011 policy year) on two Northwestern Mutual
Life Insurance Company policies on the Executive’s life (Nos. 15-145-189 and
16-176-764), to the extent not in excess of Twenty-Four Thousand Two Hundred
Thirty-Eight Dollars ($24,238) in the aggregate for each such year, within
thirty (30) days after receipt of reasonable substantiating documentation from
the Executive, but in any event not later than the end of the calendar year
following the year in which such expense was incurred. In addition, in each such
year the Company shall pay to the appropriate taxing authorities on the
Executive’s behalf an amount equal to the Tax Gross-up (as defined in clause
(iii)) with respect to such premium payments. If the Executive should die or
cancel or surrender such policies during the three (3) year period, no further
payments by the Company shall be required, and if the Executive cancels or
surrenders one such policy during the three (3) year period, no further payments
by the Company shall be required with respect to such policy. The Company agrees
to use its best efforts to have any restrictive endorsements on these policies
removed not later than December 31, 2008.

viii. The Company shall continue or cause to be continued the coverage of the
Executive (and the Executive’s previously covered dependents, if any) under the
following employee benefit plans of the Company, upon substantially the same
terms and conditions (including the required employee contribution, if any) as
apply to comparably situated executives, for a period of three (3) years
beginning on August 8, 2007:

  (I)   Health Protection Plan,

     
(II)
(III)
(IV)
  Prescription Plan,
Dental Assistance Plan,
Vision Care Plan, and

  (V)   Basic and Supplemental Life Insurance Plans.

With respect to all health plan coverages that are not provided under an insured
plan, the Executive shall duly elect and pay for COBRA continuation coverage.
The Company’s obligation with respect to all health plan coverages that are not
provided under an insured plan is conditioned on the Executive’s duly electing,
and then paying for, COBRA coverage throughout the available COBRA continuation
coverage period.

If the continuation of any coverage identified in clauses (I) through (V) above
is not reasonably available pursuant to the applicable insurance policy or plan
and, in the case of any health plan coverage not provided under an insured plan,
after the end of the available COBRA continuation period:

  (A)   The parties will cooperate and use their best efforts to obtain an
individual policy or policies that provides the Executive (and his previously
covered dependents, if any) substantially equivalent coverage, and the Company
will pay, for a period of three (3) years beginning on August 8, 2007, the
premiums on any such individual policy, to the extent in excess of the required
employee contribution paid by the Executive prior to August 8, 2007.

  (B)   If the continuation of any such coverage is not available pursuant to
the applicable insurance policy or plan, and an individual policy cannot be
obtained despite the parties’ cooperative best efforts:

  (I)   With respect to group health plan coverage, the Company will reimburse
the Executive for any medical expense he (and his previously covered dependents,
if any) incur during the period after COBRA coverage has terminated and before
August 8, 2010, provided that such expense would have been reimbursed by the
applicable Company plan. The Company shall pay such reimbursement promptly upon
receipt of reasonable documentation thereof from the Executive, but in any event
not later than the end of the calendar year following the year in which the
expense was incurred.

  (II)   With respect to any other such coverage, the Company shall, during the
three (3) year period beginning on August 8, 2007, pay or reimburse the
Executive (and his previously covered dependents, if any) the same amount that
would have been paid by the applicable plan or policy. The Company shall make
such payment upon receipt of reasonable substantiating documentation from the
Executive, but in any event not later than the end of the calendar year
following the year in which any reimbursable expense was incurred.

b. In the event of the Executive’s death before payment of the benefit described
in Section 3(a)(i), the Company shall pay the benefit at the scheduled time to
the Executive’s surviving spouse, as the primary beneficiary, with the
contingent beneficiary being the Jeffrey A. Ludrof Revocable Trust dated
January 21, 2000.

In the event of the Executive’s death before payment of a benefit described in
any of the paragraphs (ii) through (vi) of Section 3(a), the Company shall pay
the benefit at the scheduled time to the beneficiary or beneficiary designated
by the Executive in accordance with the terms of the plan or arrangement to
which the benefit relates; provided, however, that if the Executive has not
designated a beneficiary in accordance with the terms of the applicable plan or
arrangement, or if no designated beneficiary with respect to the plan or
arrangement survives the Executive, the Company shall pay the benefit to the
executor or administrator of the Executive’s estate.

c. All payments under this Section 3, whether or not in cash, shall be subject
to applicable deductions. For the purposes of this Agreement, “applicable
deductions” shall include, but shall not be limited to, any federal, state, or
local taxes determined by the Company to be required to be withheld from amounts
paid to the Executive pursuant to this Agreement or otherwise due from the
Company, and any other amounts that the Company may be legally required to
deduct from his earnings.

d. Any date specified as a payment date under this Section 3 shall be construed
as meaning any date on or about the specified date; provided, however, that the
Company shall make payment as soon as practicable after the specified date
without, to the extent possible, incurring any tax penalties on either the
Executive or the Company.

e. Except as provided in this Agreement, the Executive agrees that he is not
entitled to any other compensation (including, but not limited to, salary or
bonuses), perquisites, or benefits of any kind or description from the Company,
or from or under any employee benefit plan or fringe benefit plan sponsored by
the Company or under the Employment Agreement, other than as described above and
other than the Erie Insurance Group Retirement Plan for Employees and the Erie
Insurance Group Employee Savings Plan. The consideration paid by the Company to
the Executive pursuant to this Agreement shall be in compromise, settlement and
full satisfaction of any and all Claims, as defined in Section 4 of this
Agreement, that the Executive has, or may have, against the Company or other
Releasees, as defined in Section 4 of this Agreement, arising out of the
Executive’s employment with the Company or its affiliates, the termination of
such employment and any and all matters related to the Executive’s employment
and termination, or to his Employment Agreement.

4. Executive’s Waiver and Release. The Executive, for himself, his heirs,
successors and assigns and in consideration of the payments to be made by or on
behalf of the Company pursuant to Section 3 of this Agreement, does hereby
forever discharge and release the Company, and its corporate parents,
subsidiaries, affiliated companies, companies with common management, ownership
or control, successors, assigns, insurers and reinsurers, attorneys, and
franchisees, and all of their officers, directors, shareholders, employees,
agents and representatives, in their official and individual capacities
(collectively referred to as “Releasees”), from any and all claims, demands,
causes of action, damages, charges, complaints, grievances, expenses,
compensation and remedies which the Executive now has or may in the future have
on account of or arising out of any matter or thing which has happened,
developed or occurred before the date of this Agreement (collectively “Claims”),
including, but not limited to, all Claims arising from the Executive’s
employment with the Company or any of its affiliated companies, the termination
of such employment, any and all relationships or dealings between the Executive
and the Company or any of the other Releasees, the termination of any such
relationships and dealings, and any and all other Claims the Executive may have
against the Company or any of the other Releasees, and the Executive hereby
waives any and all such Claims including, all charges or complaints that were or
could have been filed with any other court, tribunal or governmental agency, and
any and all Claims not previously alleged, including, but not limited to, any
Claims under the following: (a) Title VII of the Civil Rights Act of 1964, as
amended; (b) the Age Discrimination in Employment Act (ADEA), as amended;
(c) the Federal Employee Retirement Income Security Act of 1974 (ERISA), as
amended; (d) the Americans With Disabilities Act (ADA), as amended; (e) the
Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA), as amended;
(f) Section 806 of the Sarbanes-Oxley Act of 2002, as amended; (g) any and all
statutes of similar nature or purpose under Pennsylvania law, or the law of any
other state, including, but not limited to, the Pennsylvania Human Relations
Act, as amended; and (h) any federal, state or local law, rule, regulation,
constitution, executive order or guideline of any description, including, but
not limited to, those laws described above, or any rule or principle of equity
or common law, or any Claim of defamation, conversion, interference with a
contract or business relationship, or any other intentional or unintentional
tort, or any Claim of loss of consortium, or any Claim of harassment or
retaliation, or breach of contract or implied contract, or breach of covenant of
good faith and fair dealing, or any whistle-blower Claim. This release,
discharge and waiver shall be hereinafter referred to as the “Release.”

The Executive specifically understands and agrees that the termination of his
employment does not violate or disregard any oral or written promise or
agreement, of any nature whatsoever, express or implied. If any contract or
agreement of employment exists concerning the employment of the Executive by the
Company or the terms and conditions of such employment or the termination of
such employment, whether oral or written, express or implied, that contract or
agreement (including the Employment Agreement) is hereby terminated and is null
and void.

The Executive agrees that this Release may be enforced in federal, state or
local court, and before any federal, state or local administrative agency or
body.

This Release does not prohibit the Executive from filing an administrative
charge of alleged employment discrimination, harassment or retaliation under
Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment
Act of 1967, the Americans With Disabilities Act or the Equal Pay Act of 1963;
however, the Executive represents that he has not to date filed or cause to be
filed any such administrative charge, and further agrees that he hereby waives
any right to monetary or other recovery should any federal, state or local
administrative agency pursue any Claim on his behalf and will immediately
request in writing that the Claim or matter on his behalf be withdrawn. Thus by
signing this Agreement, the Executive waives any right he had to obtain a
recovery if an administrative agency pursues a Claim against the Company or any
of the other Releasees based on any action taken by the Company or any of the
other Releasees up to the date of this Agreement, and that he will have released
the Company and the other Releasees of any and all Claims, and the continuing
effect of any and all Claims of any nature up to the date of this Agreement.
This Release does not affect any of the Executive’s vested rights under the Erie
Insurance Group Retirement Plan for Employees and the Erie Insurance Group
Employee Savings Plan, nor, with respect to any of the capacities in which the
Executive served the Company or each of its subsidiaries and related companies,
or as a trustee of any employee benefit trusts or other trusts maintained or
sponsored by the Company or each of its subsidiaries and related companies, does
it bar any claim the Executive may have for indemnity in relation to any acts or
omissions of the Executive or a claim for coverage under any applicable
insurances, or any claim relating to enforcement of this Agreement

5. Additional Terms.

a. Except as otherwise provided in Section 4 or this Section 5, the Executive
agrees not to commence or continue any action or proceeding in any federal,
state or local court, concerning any Claim waived or released in this Agreement.

b. The Executive represents that he has not filed or caused to be filed, and
agrees that he will not file or cause to be filed, any lawsuit of any kind
arising out of or relating to his employment with the Company, the terms and
conditions of that employment, or the termination of his employment.

c. Nothing contained in this Agreement prohibits the Executive from seeking a
determination by a court of competent jurisdiction that the Release is, in whole
or in part, invalid under applicable law. To the extent of such determination,
the Executive may assert Claims or other matters included in the Release,
subject to final determination on appeal.

d. The Executive agrees that he has not sustained any disabling personal injury
and/or occupational disease which has resulted in a loss of wage earning
capacity during his employment with the Company, and that he has no personal
injury and/or occupational disease which has been contributed to, or aggravated
or accelerated in a significant manner by his employment with the Company.

e. The Executive represents and warrants that the Company has encouraged and
advised the Executive in writing, prior to signing this Agreement, to consult
with an attorney of the Executive’s choosing concerning all of the terms of this
Agreement.

f. This Agreement may be revoked by the Executive within seven (7) days after
the date this Agreement is signed by the Executive, by giving notice of
revocation to James J. Tanous, the Executive Vice President, Secretary and
General Counsel of the Company. This Agreement shall not become effective or
enforceable until the revocation period has expired and the consideration
provided in Section 3 of this Agreement shall not be made until after the
revocation period has expired with no revocation.

g. The Executive represents and warrants that the Company has given the
Executive a reasonable period of time, of at least twenty-one (21) days, for the
Executive to consider all the terms of this Agreement and for the purpose of
consulting with an attorney if the Executive so chooses. A copy of this
Agreement was first given to the Executive on November 14, 2007. If this
Agreement has been executed by the Executive prior to the end of the twenty-one
(21) day period, the Executive represents that he has freely and willingly
elected to do so.

h. This Agreement provides the Executive sums and benefits to which he is not
otherwise entitled as an employee of the Company.

i. Nothing contained in this Agreement is intended to be an admission of any
fault, wrongdoing, or liability on the part of any of the parties hereto, and
nothing contained in this Agreement may be deemed, construed, or treated in any
respect as such an admission. The Company specifically denies any fault,
wrongdoing or liability toward the Executive. This Agreement was reached by the
parties as a mutual compromise of their respective positions, in order to avoid
the costs and inconvenience of litigation and for other reasons deemed good and
sufficient by the respective parties.

6. Non-Disparagement. The Executive shall not disparage the Company or other
Releasees, its products or services or its officers, directors or employees in
any way orally or in writing, and the directors and executive officers of the
Company shall likewise not disparage the Executive.

7. Covenants as to Confidential Information and Competitive Conduct. The
Executive hereby acknowledges and agrees as follows: (a) this Section 7 is
necessary for the protection of the legitimate business interests of the
Company, (b) the restrictions contained in this Section 7 with regard to
geographical scope, length of term and types of restricted activities are
reasonable; (c) the Executive has received adequate and valuable consideration
for entering into this Agreement, and (d) the Executive’s expertise and
capabilities are such that his obligations hereunder and the enforcement hereof
by injunction or otherwise will not adversely affect the Executive’s ability to
earn a livelihood.

a. Confidentiality of Information and Nondisclosure. The Executive agrees that
the Executive will not, directly or indirectly, without the express written
approval of the Company, unless directed by applicable legal authority
(including any court of competent jurisdiction, governmental agency having
supervisory authority over the business of the Company or its subsidiaries, or
any legislative or administrative body having supervisory authority over the
business of the Company or its subsidiaries) having jurisdiction over the
Executive, disclose to or use, or knowingly permit to be so disclosed or used,
for the benefit of himself, any person, corporation or other entity other than
the Company, (i) any non-public information concerning any financial matters,
customer relationships, competitive status, supplier matters, internal
organizational matters, current or future plans, or other business affairs of or
relating to the Company, its subsidiaries or affiliated or related parties,
(ii) any proprietary management, operational, trade, technical or other secrets
or any other proprietary information or other data of the Company, its
subsidiaries or affiliated or related parties, or (iii) any other information
related to the Company, its subsidiaries or affiliated or related parties, or
which the Executive should reasonably believe will be damaging to the Company,
its subsidiaries or affiliated or related parties, which has not been published
and is not generally known outside of the Company. The Executive acknowledges
that all of the foregoing constitutes confidential and proprietary information,
which is the exclusive property of the Company.

b. Restrictive Covenant. For a period of eighteen (18) months (the “Restrictive
Period”) beginning on August 9, 2007, the Executive shall not render, directly,
or indirectly, services to any person, firm, corporation, association, or other
entity which conducts the same or similar business as the Company or its
subsidiaries at the date of the Executive’s termination of employment hereunder
within the states in which the Company or its subsidiaries is or are then
licensed and doing business at the date of the Executive’s termination of
employment hereunder without the prior written consent of the Company’s Board of
Directors, which may be withheld in its discretion. In the event the Executive
violates any of the provisions contained in this Section 7 hereof, the
Restrictive Period shall be increased by the period of time from the
commencement by the Executive of any violation until such violation has been
cured to the satisfaction of the Company. The Executive further agrees that at
no time during the Restrictive Period will the Executive attempt to directly or
indirectly solicit or hire employees of the Company or its subsidiaries or
induce any of them to terminate their employment with the Company or its
subsidiaries.

c. Company Remedies. The Executive acknowledges and agrees that any breach of
this Section 7 will result in immediate and irreparable harm to the Company, and
that the Company cannot be reasonably or adequately compensated by damages in an
action at law. In the event of a breach by the Executive of the provisions of
this Section 7, the Company shall be entitled, to the extent permitted by law,
immediately to cease to pay or provide the Executive or the Executive’s
dependents any compensation or benefit being, or to be, paid or provided to the
Executive pursuant to this Agreement, and also to obtain immediate injunctive
relief restraining the Executive from conduct in breach of the covenants
contained in this Section 7. Nothing herein shall be construed as prohibiting
the Company from pursuing any other remedies available to it for such breach,
including the recovery of damages from the Executive.

8. Breach of Agreement. The Executive agrees that if he violates any of the
terms of this Agreement, in addition to any other remedy that the Company may
have in law or in equity, the Executive, if the Company so elects, shall be
liable to the Company for any and all sums of money paid to Executive and for
the costs incurred by the Company in compliance with Section 3 of this Agreement
and, from that date forward, if it so elects, the Company shall have no further
obligation under Section 3 of this Agreement, except as may be required by law.
The Company’s enforcement of its rights under this Section will not affect the
validity and enforceability of the Release contained in this Agreement. If the
Executive is required to bring any action to enforce rights or to collect moneys
due under this Agreement, the Company shall pay to the Executive the fees and
expenses incurred by the Executive in bringing and pursuing such action provided
that the Executive is successful, in whole or in part, on the merits or
otherwise (including by way of a settlement involving the payment of money by
the Company to the Executive), in such action. The Company shall pay such fees
and expenses in advance of the final disposition of such action. The Executive
agrees to repay to the Company such advances if the Executive is not ultimately
successful, in whole or in part, on the merits or otherwise, in such action. The
Company shall make such payments within thirty (30) days after receipt of
reasonable substantiating documentation from the Executive but in no event later
than the end of the calendar year following the year in which such fees and
expenses were incurred.

9. Company Property, Records, Files and Equipment. The Executive will return all
Company property, records, files, or any other Company owned equipment in his
possession within ten (10) days after the execution of this Agreement.

10. Confidentiality of Agreement. The Executive agrees that (except pursuant to
judicial legal process or any legal action to enforce this Agreement), the
Executive shall keep confidential the terms of this Agreement, and all
performance hereunder, and shall not disclose this information henceforth to
anyone other than the United States Internal Revenue Service; state or local tax
authorities; or the Executive’s family, attorneys and tax advisors, who also
shall be bound by this confidentiality obligation. The foregoing shall not
prohibit or restrict such disclosure as is required by law or may be necessary
for the prosecution of claims relating to the performance or enforcement of this
Agreement or prohibit or restrict the Executive (or the Executive’s counsel)
from responding to any inquiry about the agreements represented in this
Agreement or the underlying facts and circumstances of those agreements by the
Securities and Exchange Commission, the NASDAQ Stock Market or any other
self-regulatory organization. Prior to responding to any such inquiry, the
Executive agrees to provide the Company with as much notice as possible that he
has been requested or compelled to make disclosures and use the Executive’s (or
the Executive’s counsel) best efforts to ensure that if any disclosure occurs,
it does so in a manner designed to maintain the confidentiality of this
Agreement to the fullest extent possible.

11. Ongoing Cooperation. The Executive agrees to assist, advise and cooperate
with the Company in the future if the Company so requests on issues that arose
or were in any way developing during his employment with the Company. The
Executive shall furnish such assistance, advice or cooperation to the Company as
the Company shall reasonably request and as is within the Executive’s
capability. Such assistance, advice and cooperation may include, but shall not
be limited to the preparation for, or the conduct of, any litigation,
investigation or proceeding involving matters or events which occurred during
the Executive’s employment by the Company as to which the Executive’s knowledge
or testimony may be important to the Company. In connection with the preparation
for, or the conduct of such litigation, investigation or proceeding as described
in the preceding sentence, the Executive shall promptly provide the Company with
any records or other materials in his possession that the Company shall request
in connection with the defense or prosecution of such litigation, investigation
or proceeding. The Company shall pay or reimburse the Executive for his travel
expenses reasonably incurred in the course of providing such cooperation. The
Company shall make such payment or reimbursement within thirty (30) days of
receipt of reasonable substantiating documentation from the Executive but in no
event later than the end of the calendar year following the year in which such
expenses were incurred.

12. Letter of Understanding. Upon the execution by the Executive of this
Agreement, the Letter of Understanding shall be null and void.

13. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the Commonwealth of Pennsylvania applicable to
contracts executed in and to be performed in that commonwealth without regard to
its conflicts of laws provisions. Each of the parties hereby irrevocably and
unconditionally consents to submit to the exclusive jurisdiction of the courts
of the Commonwealth of Pennsylvania located in the County of Erie, Pennsylvania,
and of the United States for the Western District of Pennsylvania for any
litigation arising out of or relating to this Agreement or the transactions
contemplated hereby. Each of the parties hereby irrevocably and unconditionally
acknowledges that service of any process, summons, notice or document by United
States registered mail to the respective addresses set forth herein shall be
effective service of process for any litigation brought against a party in any
such court. Any legal action relating to this Agreement shall be brought in the
courts of the Commonwealth of Pennsylvania located in the County of Erie,
Pennsylvania, and of the United States for the Western District of Pennsylvania
and the parties irrevocably and unconditionally waive and will not plead or
claim in any such court that venue is improper or that such litigation has been
brought in an inconvenient forum.

14. Waiver. The waiver by a party hereto of any breach by the other party hereto
of any provision of this Agreement shall not operate or be construed as a waiver
of any other or subsequent breach by a party hereto.

15. Assignment. This Agreement shall be binding upon and inure to the benefit of
the successors and assigns of the Company, and the Company shall be obligated to
require any successor to expressly acknowledge and assume its obligations
hereunder. This Agreement shall inure to the extent provided hereunder to the
benefit of and be enforceable by the Executive or the Executive’s legal
representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees. The Executive may not delegate any of the Executive’s
duties, responsibilities, obligations or positions hereunder to any person and
any such purported delegation shall be void and of no force and effect.

16. Severability. Whenever possible, each provision of this Agreement shall be
interpreted in such a manner as to be effective and valid under applicable law,
but if any provision of this Agreement is held to be invalid under applicable
law, such provision shall be ineffective only to the extent of such prohibition
or invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Agreement.

17. Notices. Any notices required or permitted to be given under this Agreement
shall be sufficient if in writing, and if personally delivered or when sent by
first class certified or registered mail, postage prepaid, return receipt
requested — in the case of the Executive, to his principal residence address,
and in the case of the Company, to the address of its principal place of
business as set forth above, to the attention of the Executive Vice President,
Secretary and General Counsel of the Company.

18. Defined Terms. Any terms not specifically defined herein have the meanings
set forth in the Employment Agreement.

19. Entire Agreement. This Agreement constitutes the entire agreement of the
parties relating to the subject matter hereof, and supersedes any obligations of
the Company and the other Releasees under any previous agreements or
arrangements (including the Employment Agreement and the Letter of
Understanding), except as otherwise provided in this Agreement. The provisions
of this Agreement may not be amended, modified, repealed, waived, extended or
discharged except by an agreement in writing signed by the party against whom
enforcement of any amendment, modification, repeal, waiver, extension or
discharge is sought. No person acting other than pursuant to a resolution of the
Company’s Board of Directors shall have authority on behalf of the Company to
agree to amend, modify, repeal, waive, extend or discharge any provision of this
Agreement or anything in reference thereto. This Agreement may be executed in
one or more counterparts (including by facsimile signature), all of which shall
be considered one and the same instrument, and shall be fully executed when one
or more counterparts have been signed by and delivered to each party.

20. Headings. The descriptive headings used herein are used for convenience of
reference only and shall not constitute a part of this Agreement.  

THE EXECUTIVE HEREBY EXPRESSLY WARRANTS AND REPRESENTS THAT, BEFORE ENTERING
INTO THIS AGREEMENT, HE HAS RECEIVED A REASONABLE PERIOD OF TIME WITHIN WHICH TO
CONSIDER ALL OF THE PROVISIONS CONTAINED IN THIS AGREEMENT, THAT HE HAS FULLY
READ, INFORMED HIMSELF OF AND UNDERSTANDS ALL THE TERMS, CONTENTS, CONDITIONS
AND EFFECTS OF ALL PROVISIONS OF THIS AGREEMENT, AND THAT HE CONSIDERS ALL SUCH
PROVISIONS TO BE SATISFACTORY.

THE EXECUTIVE FURTHER EXPRESSLY WARRANTS AND REPRESENTS THAT NO PROMISE OR
REPRESENTATION OF ANY KIND HAS BEEN MADE, EXCEPT THOSE EXPRESSLY STATED IN THIS
AGREEMENT.

THE EXECUTIVE FURTHER EXPRESSLY WARRANTS AND REPRESENTS THAT HE ENTERS INTO THIS
AGREEMENT KNOWINGLY AND VOLUNTARILY.

IN WITNESS WHEREOF, the Executive and the Company, by its duly authorized
representative, have signed this Agreement as of the date set forth above.

     
WITNESS:
  THE EXECUTIVE:
/s/ Carol G. Stauch
  /s/ Jeffrey A. Ludrof
JEFFREY A. LUDROF
 
  THE COMPANY:
ATTEST:
  ERIE INDEMNITY COMPANY
/s/ James J. Tanous
James J. Tanous, Secretary
  By: /s/ John J. Brinling, Jr.
John J. Brinling, Jr., President and CEO