Exhibit 10.10

 

 

WILLOW GROVE BANCORP, INC.

 

Deferred Compensation Plan

 

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WILLOW GROVE BANCORP, INC.

 

Deferred Compensation Plan

 

1.

Purposes

 

 

 

 

2.

Definitions

 

 

 

 

3.

Administration

 

 

 

 

4.

Participation

 

 

 

 

5.

Deferrals

 

 

 

 

6.

Deferral Accounts For Non-Stock-Denominated Awards

 

 

 

 

7.

Deferral Accounts For Stock-Denominated Awards

 

 

 

 

8.

Settlement of Deferral Accounts

 

 

 

 

9.

Provisions Relating to Section 16 of the Exchange Act

 

 

 

 

10.

Statements

 

 

 

 

11.

Sources of Stock: Limitation on Account of Stock-Denominated Deferrals

 

 

 

 

12.

Amendment/Termination

 

 

 

 

13.

General Provisions

 

 

 

 

14.

Effective Date

 

 

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WILLOW GROVE BANCORP, INC.

 

Deferred Compensation Plan

 

 

1.             Purposes.  The purpose of this Deferred Compensation Plan (the
“Plan”) is to provide Non-Employee Directors of Willow Grove Bancorp, Inc. (the
“Company”) and its Subsidiaries as well as certain members of the Company’s
senior management team with the opportunity to elect to defer receipt of
specified portions of their compensation and to have such deferred amounts
treated as if invested in specified investment vehicles.

 

2.             Definitions.  In addition to the terms defined in Section 1
above, the following terms used in the Plan shall have the meanings set forth
below:

 

(a)           “Administrator” shall mean such person or persons designated
pursuant to Section 3(b) hereof to whom the Committee has delegated authority to
take action under the Plan, except as may be otherwise required under Section 9
hereof.

 

(b)           “Beneficiary” shall mean any person (which may include trusts and
is not limited to one person) who has been designated by the Participant in his
or her most recent written beneficiary designation form filed with the Company
to receive the benefits specified under the Plan in the event of the
Participant’s death.  If no Beneficiary has been designated or if no designated
Beneficiary survives the Participant’s death, then the Beneficiary shall mean
the Participant’s estate.

 

(c)           “Change in Control” shall be deemed to have occurred if: (i) the
acquisition of control of the Company as defined in 12 C.F.R. §574.4, unless a
presumption of control is successfully rebutted or unless the transaction is
exempted by 12 C.F.R. §574.3(c)(vii), or any successor to such sections; (ii) an
event that would be required to be reported in response to Item 1(a) of Form 8-K
or Item 6(e) of Schedule 14A of Regulation 14A pursuant to the Exchange Act (as
defined below), whether or not any class of securities of the Company is
registered under the Exchange Act; (iii) any “person” (as such term is used in
Section 13(d) and 14(d) of the Exchange Act), is or becomes the “beneficial
owner” (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of the securities of the Company representing 20% or more of the
combined voting power of the Company’s then outstanding securities; or (iv)
during any period of three (3) consecutive years, individuals who at the
beginning of such period constitute the Board of Directors of the Company cease
for any reason to constitute at least a majority thereof unless the election, or
the nomination for election by stockholders, of each new director was approved
by a vote of at least two-thirds of the directors then still in office who were
directors at the beginning of the period.

 

(d)           “Code” shall mean the Internal Revenue Code of 1986, as amended.
References to any provision of the Code or regulation (including proposed
regulation) thereunder shall include any successor provisions or regulations.

 

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(e)           “Committee” shall mean the Compensation Committee of the Board of
Directors of the Company.

 

(f)            “Deferral Account(s)” shall mean Non-Stock-Denominated Deferral
Accounts and Stock-Denominated Deferral Accounts, singularly or collectively, as
appropriate.  Deferral Accounts will be maintained solely as bookkeeping entries
by the Company to evidence the unfunded obligations of the Company hereunder.

 

(g)           “Disability” shall mean any physical or mental impairment which
qualifies the Participant for disability benefits under the applicable long-term
disability plan maintained by the Company (or any Subsidiary) or, if no such
plan applies, which would qualify the Participant for disability benefits under
the long-term disability plan maintained by the Company, if such individual were
covered by that plan.

 

(h)           “Employee” means any person who is employed by the Company or any
of its Subsidiaries, including employees who may also be directors of the
Company or its Subsidiaries.

 

(i)            “Exchange Act” shall mean the Securities Exchange Act of 1934, as
amended.  References to any provision of the Exchange Act or rule thereunder
shall include any successor provisions or rules.

 

(j)            “Non-Employee Director” means a member of the Board of Directors
of the Company or the Board of Directors of the Willow Grove Bank or any
successor thereto who is not an Employee.

 

(k)           “Non-Stock-Denominated Deferral Account” shall mean the accounts
or sub-accounts established and maintained by the Company for specified
deferrals made by a Participant pursuant to Section 6 hereof.

 

(l)            “Participant” shall mean any Non-Employee Director of the Company
or any Subsidiary or any Employee of the Company or any Subsidiary who is
designated by the Company’s Board of Directors or the Committee as eligible to
participate in this Plan and who makes an election to participate in the Plan.

 

(m)          “Restricted Stock Award” shall mean awards granted pursuant to the
Company’s 1999 and 2002 Recognition and Retention Plans or any similar and/or
successor plans.

 

(n)           “Retirement” shall mean termination of employment or separation of
service for a Non-Employee Director by a Participant on or after the age of
fifty-five (55).

 

(o)           “Stock” shall mean the Common Stock, with a par value of $0.01 per
share, of Willow Grove Bancorp, Inc. or any other equity securities of the
Company designated by the Committee.

 

(p)           “Stock-Denominated Awards” shall mean a Restricted Stock Award or
similar type of award which has been made pursuant to a plan or arrangement
which has been approved

 

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by the Company’s shareholders and which is determined by the Committee to be
appropriate for deferral under the terms of this Plan.

 

(q)           “Stock-Denominated Deferral Account” shall mean the accounts or
sub-accounts established and maintained by the Company for specified deferrals
made by a Participant pursuant to Section 7 hereof.

 

(r)            “Subsidiary” or “Subsidiaries” means Willow Grove Bank and any of
the subsidiaries of the Company or Willow Grove Bank which, with the consent of
the Board, agree to participate in this Plan.

 

(s)           “Trust” shall mean the trust or trusts established by the Company
pursuant Sections 6 and 7 hereof.

 

(t)            “Trustee(s)” shall mean the trustee(s) of the Trust(s).

 

(u)           “Trust Agreement” shall mean the agreement(s) entered into between
the Company and the Trustee(s), as amended or restated from time to time.

 

(v)           “Valuation Date” shall mean the close of business on the last
business day of each calendar quarter; provided however, that in the case of
termination of service for reasons other than Retirement, death or Disability,
the Valuation Date shall mean the close of business on the last day of business
of the month in which service terminates, and in the case of a Change in Control
of the Company, the Valuation Date shall be the effective date of such Change in
Control.

 

3.             Administration.

 

(a)           Committee Authority.  The Committee shall administer the Plan in
accordance with its terms and shall have all powers necessary to accomplish such
purpose, including the power and authority to construe and interpret the Plan,
to define the terms used herein, to prescribe, amend and rescind rules and
regulations, agreements, forms and notices relating to the administration of the
Plan, and to make all other determinations necessary or advisable for the
administration of the Plan.

 

(b)           Delegation of Duties; Powers.  The Committee may delegate its
duties and responsibilities hereunder, as it deems reasonable and appropriate,
to the Administrator.  If an Administrator is appointed by the Committee, such
Administrator shall serve at the will of, and may be removed (with or without
cause) by the Committee.  Any actions of the Committee or the Administrator with
respect to the Plan shall be conclusive and binding upon all persons interested
in the Plan, except that any action of the Administrator will not be binding on
the Committee.  The Committee and Administrator may each appoint agents and
delegate thereto powers and duties under the Plan, except as otherwise limited
by the Plan.

 

(c)           Limitation of Liability.  Each member of the Committee and the
Administrator shall be entitled to, in good faith, rely or act upon any report
or other information furnished to

 

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him or her by any officer or other employee of the Company or any Subsidiary,
the Company’s independent public accountants or any compensation consultant,
legal counsel, or other professional retained by the Company to assist in the
administration of the Plan.  To the maximum extent permitted by law, no member
of the Committee or the Administrator, nor any person to whom ministerial duties
have been delegated, shall be liable to any person for any action taken or
omitted in connection with the interpretation and administration of the Plan. 
To the maximum extent permitted by law, the Company shall indemnify the members
of the Committee and the Administrator against any and all claims, losses,
damages, expenses, including any counsel fees and costs incurred by them, and
any liability, including any amounts paid in settlement with their approval,
arising from their action or failure to act.

 

4.             Participation.  The Administrator will notify each person of his
or her eligibility to participate and the extent to which such person can
participate in the Plan within 30 days of the Committee’s designation that such
person is so eligible to participate in the Plan.

 

5.             Deferrals.

 

(a)           Deferrals.  With the consent of the Committee, a Participant may
elect to defer otherwise taxable compensation, fees or awards which may be in
the form of cash or Stock to be received from the Company or a Subsidiary,
including Stock-Denominated Awards, director’s fees, salary, annual incentive
awards and taxable compensation payable under other plans and programs,
employment agreements or other arrangements or as designated by the Committee;
provided; however, that a Participant who is an Employee may only defer, with
respect to a given year, receipt of only that portion of the Participant’s
salary, fees, annual incentive awards, Stock-Denominated Awards and compensation
payable under all plans and programs, employment agreements or other
arrangements that exceeds the FICA maximum taxable wage base plus the amount
necessary to satisfy Medicare and all other payroll taxes (other than federal,
state or local income tax withholding) imposed on the wages of such Participant
from the Company and its Subsidiaries.  Amounts deferred hereunder shall,
subject to the provisions of Section 8 (d) hereof, not be distributed out of the
Deferred Accounts(s) prior to the date which is five years subsequent to the
date of election to defer.  In addition to such limitation, and any terms and
conditions of deferral set forth under plans and programs, employment agreements
or other such arrangements from which receipt of compensation or awards is
deferred, the Committee may impose limitations on the amounts permitted to be
deferred and other terms and conditions of deferral under this Plan.  Any such
limitations, and other terms and conditions of deferral, shall be set forth in
the rules relating to this Plan, or election forms, other forms, or instructions
published by the Committee and/or the Administrator.

 

(b)           Elections.  Once an election form, properly completed, is received
by the Company, such election of the Participant shall be irrevocable; provided
however, that the Committee and/or Administrator may, in its discretion, permit
a Participant to elect to increase the amount to be deferred and credited to a
Deferral Account by filing a later election form; provided, that such later
election form is received by the Committee prior to the applicable election
deadline pursuant to Section 5(c) hereof.  Furthermore, upon a Participant’s
initial deferral election, such Participant shall also elect the number of
installments (but not to exceed ten (10) annual installment payments) in which
the settlement of his or her Deferral Account

 

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shall be completed.  An election to change a Participant’s settlement election
must be made, in writing, while the Participant is an active employee or in the
active service of the Company or its Subsidiaries and prior to the commencement
of distribution.  However, the change shall not become effective until the one
(1) year anniversary of such election, provided the Participant remains in the
active employ or service, as the case maybe, of the Company or its Subsidiary
for the entire one (1) year period.

 

(c)           Date of Election.  An election to defer compensation or awards
hereunder must be received by the Administrator prior to the date specified by
the Administrator; provided however, that unless otherwise approved by the
Committee, any elections to defer (i) salary, fees, cash compensation and annual
incentive awards shall be made on or prior to the December 31st preceding the
calendar year in which such income shall be earned, and (ii) Restricted Stock
Awards shall be made on or prior to the December 31st preceding the calendar
year in which the Restricted Stock Awards vest.  Notwithstanding the foregoing,
elections to defer compensation or awards hereunder may be made for services to
be performed subsequent to the election (i) within 30 days of the effective date
of this Plan and (ii) within 30 days of the date a Participant first becomes
eligible to participate in this Plan, in each case, such elections to be
effective as of the immediately following payroll period of the Company.  Under
no circumstances may a Participant defer compensation or awards to which the
Participant has already attained, at the time of deferral, a legally enforceable
right to receive such compensation or awards.

 

6.             Deferral Accounts For Non-Stock-Denominated Awards.  The
following provisions will apply to Deferral Accounts other than those
established under Section 7:

 

(a)           Establishment; Crediting of Amounts Deferred.  A
Non-Stock-Denominated Deferral Account will be established for each Participant
for any deferrals made by a Participant hereunder.  The amount of compensation
or awards deferred with respect to each Non-Stock-Denominated Deferral Account
will be credited to such account as of the date on which such amounts would have
been paid to the Participant but for deferral hereunder.  Amounts credited to a
Non-Stock-Denominated Deferral Account shall be deemed to be invested in such
hypothetical investment vehicles as selected by the Participant from the list
authorized by the Committee pursuant to Section 6(b) hereof.  The amounts of
hypothetical income and appreciation and depreciation in value of such accounts
will be credited and debited to such accounts from time to time.  Unless
otherwise determined by the Committee, amounts credited to a
Non-Stock-Denominated Deferral Account shall be deemed invested in such
hypothetical investment vehicles within fifteen (15) business days following the
month-end in which the deferral occurs.

 

(b)           Hypothetical Investment Vehicles.  The Committee shall establish
one or more hypothetical investment vehicles under this Plan and may add to or
change or discontinue any hypothetical investment vehicle included in the list
of available hypothetical investment vehicles in its absolute discretion,
provided, however, that the list of hypothetical investment vehicles for the
Non-Stock Denominated Deferral Account shall not include any investment or
hypothetical investment in the Company’s common stock.

 

(c)           Allocation and Reallocation of Hypothetical Investments.  A
Participant may allocate amounts credited to his or her Non-Stock-Denominated
Deferral Account to one or more

 

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of the hypothetical investment vehicles authorized under the Plan.  Subject to
the rules established by the Administrator, a Participant may reallocate amounts
credited to his or her Non-Stock-Denominated Deferral Account (to be effective
as of the Valuation Date immediately following the Participant’s election) to
one or more of such hypothetical investment vehicles, by filing with the
Administrator a notice,  in such form as may be specified by the Administrator. 
The Committee or Administrator may restrict allocations or reallocations by
specified Participants into or out of specified investment vehicles or specify
minimum amounts that may be allocated or reallocated by Participants; however,
any such allocation or reallocation shall be made in accordance with all
applicable provisions of the Exchange Act and the regulations promulgated
thereunder, including but not limited to, Section 16(b) and the regulations
thereunder.

 

(d)           Investment Return.  In order to simulate an investment return for
the amounts held in each Participant’s Non-Stock-Denominated Deferral Account,
the account balance shall be reduced for the reasonable transaction costs
associated with the Participant’s investment directions and be adjusted to
recognize the hypothetical income, appreciation and depreciation generated by
the hypothetical investments that the Non-Stock-Denominated Deferral Account is
deemed to be invested in.

 

(e)           Trusts.  The Committee may, in its discretion, establish one or
more Trusts and deposit therein amounts of cash, Stock, or other property not
exceeding the amount of the Company’s obligations with respect to the
Participants’ Non-Stock-Denominated Deferral Account established under Section 6
hereof.

 

7.             Deferral Accounts For Stock-Denominated Awards.

 

(a)           Establishment.  Subject to any terms and conditions imposed by the
Committee, Participants may elect to defer, under the Plan, amounts which would
otherwise be taxable income of a Participant as a result of the exercise,
earning, vesting, or such similar event with respect to Stock-Denominated
Awards.  In connection with such deferral of a Stock-Denominated Award, a
Stock-Denominated Deferral Account shall be established for such Participant. 
On terms determined by the Committee, the Stock-Denominated Deferral Account
will, as of the date that taxable income from a Stock-Denominated Award would
otherwise be recognized by a Participant,  be credited with a number of share
units corresponding to the number of shares of Stock represented in the amount
of Stock-Denominated Award being deferred hereunder.  With respect to any
fractional shares, the Committee or the Administrator may pay such fractional
shares to the Participant in cash or credit the Participant’s
Non-Stock-Denominated Deferral Account with such amount in lieu of depositing
such fractional shares into the Stock-Denominated Deferral Account.

 

(b)           Investment Return.  Hypothetical appreciation and depreciation in
value of the Stock-Denominated Deferral Account shall be equal to the actual
appreciation and depreciation of the Stock.  Cash dividends and distributions
with respect to share units in the Stock-Denominated Deferral Account shall be
credited to a Participant’s Stock-Denominated Deferral Account in the form of
additional share units.

 

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(c)           Allocation of Hypothetical Investment.  Stock-Denominated Awards
deferred pursuant to this Section 7 shall continuously be deemed invested in
Stock share units until settlement of the Stock-Denominated Deferral Account
pursuant to Section 8 hereof and the Participant shall not be entitled to
reallocate Stock-denominated deferrals into any other hypothetical investments.

 

(d)           Trusts.  The Committee may, in its discretion, establish one or
more Trusts (including sub-accounts under such Trusts), and deposit therein
amounts of cash, Stock, or other property not exceeding the amount of the
Company’s obligations with respect to a Participants’ Stock-Denominated Deferral
Account established under Section 7.

 

(e)           Voting of Plan Shares.  Stock-Denominated Awards deferred under
the Plan shall be voted by the Trustee in its discretion giving consideration
to, among other factors, any instructions which the Trustee may have received
from a Participant.

 

8.             Settlement of Deferral Accounts.

 

(a)           Form of Payment.  The Company shall settle a Participant’s
Deferral Account, and discharge all of its obligations to pay deferred
compensation under the Plan with respect to such Deferral Account as follows:
(i) by payment of cash or, at the Participant’s election, in the form of the
securities underlying the hypothetical investment vehicle(s) established under
Section 6 for amounts credited to a Non-Stock-Denominated Deferral Account; and
(ii) by delivery of Stock for Stock-Denominated Awards.

 

(b)           Timing of Payments.  Payments in settlement of a Deferral Account
shall be made as soon as practicable after the earlier of (x) the date or dates
selected for an in-service distribution payment as indicated pursuant to a
Participant’s deferral election and as specified on a Participant’s election
form which is submitted in accordance with Section 5(b) hereof or (y) Retirement
or Disability (including upon the occurrence of other specified events), and in
such number of installments (but not to exceed ten (10) annual installment
payments), as may be directed by the Participant in his or her election relating
to such Deferral Account(s).  As described below, payments in settlement of a
Deferral Account shall be made earlier in the event of termination of employment
by the Participant in the following circumstances:

 

(i)            In the event of termination of employment or service (including,
but not limited to, death) as a Non-Employee Director for reasons other than
Retirement or Disability, a single lump sum payment in settlement of any
Deferral Account (including a Deferral Account with respect to which one or more
installment payments have previously been made) shall be made as promptly as
practicable following the Valuation Date, unless otherwise determined by the
Administrator; or

 

(ii)           In the event of a Change in Control, payments in settlement of
any Stock-Denominated Deferral Account and Non-Stock Denominated Deferral
Account (including a Deferral Account with respect to which one or more
installment payments have previously been made) shall be made within fifteen
(15) business days following the effective date of such Change in Control.

 

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(c)           Financial Emergency and Other Payments.  Other provisions of the
Plan (except Section 9) notwithstanding, if, upon the written application of a
Participant, the Committee determines that the Participant has a financial
emergency of such substantial nature and beyond the individual’s control that
payment of amounts previously deferred under the Plan is warranted, the
Committee may direct the payment to the Participant of all or a portion of the
balance of a Deferral Account and the time and manner of such payment, and the
Committee may direct such payments in other circumstances if, in the exercise of
its independent judgment, it determines that circumstances beyond the
individual’s control warrant such action.

 

9.             Provisions Relating to Section 16 of the Exchange Act.

 

Compliance with Section 16.  With respect to a Participant who is then subject
to the reporting requirements of Section 16(a) of the Exchange Act:

 

(i)                                     Any function of the Committee under the
Plan relating to such Participant shall be performed solely by the Committee if
and to the extent required to ensure the availability of an exemption under Rule
16b-3 or exclusion under Rule 16a-1(c) for such Participant with respect to the
Plan.

 

(ii)                                  Participants may not reallocate amounts
credited to any Stock-Denominated Deferral Account established pursuant to
Section 7 hereof.

 

(iii)                               To the extent necessary so that transactions
by and the rights of such a Participant under the Plan are excluded from
reporting under Rule 16a-1(c) (unless acknowledged by the Participant in writing
with respect to a specified transaction not to be excluded), if any provision of
this Plan or any rule, election form or other form, or instruction does not
comply with the requirements of such rule as then applicable to such transaction
or right under the Plan, such provision shall be construed or deemed amended to
the extent necessary to conform to such requirements.

 

(iv)                              To the extent any transaction is not excluded
from reporting under Rule 16a-1(c), the Administrator shall provide such
information to the Participant that is required for the Participant’s compliance
with Rule 16a-3(g)(1) within the applicable time periods.

 

10.          Statements.  The Administrator will furnish statements to each
Participant reflecting the amount credited to a Participant’s Deferral
Account(s) and the transactions therein not less frequently than once each
calendar year.

 

11.          Sources of Stock:  Limitation on Amount of Stock-Denominated
Deferrals.  If Stock is deposited under the Plan in a Trust pursuant to Section
7 hereof, in connection with a deferral of a Stock-Denominated Award under
another plan, program, or other such arrangement

 

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that provides for the issuance of Stock, the Stock so deposited shall be deemed
to have originated from and shall be counted against the number of shares
reserved under such other plan, program or other arrangement.

 

12.          Amendment/Termination.  The Committee may, with prospective or
retroactive effect, amend, alter, suspend, discontinue, or terminate the Plan at
any time without the consent of Participants, stockholders, or any other person;
provided however, that, without the consent of a Participant, no such action
shall materially or adversely affect the rights of such Participant with respect
to any rights to receive payment of amounts credited to such Participant’s
Deferral Account(s).  Notwithstanding the foregoing, the Committee, may, at any
time and in its sole discretion, terminate the Plan and distribute to
Participants the amounts credited to their Deferral Accounts.  Upon the
effective date of a Change in Control, this Plan shall terminate.

 

13.          General Provisions.

 

(a)           Limits on Transfer of Awards.  Other than by will or the laws of
descent and distribution, no right, title or interest of any kind in the Plan
shall be transferable or assignable by a Participant or his or her Beneficiary
or be subject to alienation, anticipation, encumbrance, garnishment, attachment,
levy, execution or other legal or equitable process, nor subject to the debts,
contracts, liabilities or engagements, or torts of any Participant or his or her
Beneficiary.  Any attempt to alienate, sell, transfer, assign, pledge, garnish,
attach or take any other action subject to legal or equitable process or
encumber or dispose of any interest in the Plan shall be void.

 

(b)           Receipt and Release.  Payments (in any form) to any Participant or
Beneficiary in accordance with the provisions of the Plan shall, to the extent
thereof, be in full satisfaction of all claims for the compensation or awards
deferred and relating to the Deferral Account(s) to which the payments relate
against the Company or any Subsidiary thereof, the Committee, or the
Administrator. The Committee or the Administrator may require a Participant or
Beneficiary, as a condition to a payment, to execute a receipt and release to
such effect.

 

(c)           Unfunded Status of Awards; Creation of Trusts.  The Plan is
intended to constitute an “unfunded” plan for deferred compensation and
Participants shall rely solely on the unsecured promise of the Company for
payment hereunder.  With respect to any payment not yet made to a Participant
under the Plan, nothing contained in the Plan shall give a Participant any
rights greater than those of a general unsecured creditor of the Company;
provided however, that nothing herein shall restrict or prohibit the Committee
from authorizing the creation of Trusts, including but not limited to the Trusts
referred to in Sections 6 and 7 hereof, or make other arrangements to meet the
Company’s obligations under the Plan, which Trusts and/or other arrangements
shall be consistent with the “unfunded” status of the Plan, unless the Committee
otherwise determines with the consent of each affected Participant.

 

(d)           Compliance.  The Company shall impose such restrictions on Stock
delivered to a Participant hereunder and any other interest constituting a
security as it may deem advisable in order to comply with the Securities Act of
1933, as amended, the requirements of the Exchange Act, the requirements of the
Nasdaq National Market System or any other stock exchange or

 

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automated quotation system upon which the Stock is then listed or quoted, any
state securities laws applicable to such a transfer, any provisions of the
Company’s Articles of Incorporation or Bylaws, or any other law, regulation, or
binding contract to which the Company is a party.

 

(e)           Other Participant Rights.  No Participant shall have any of the
rights or privileges of a stockholder of the Company (including voting rights)
under the Plan, including as a result of crediting of Stock equivalents or other
amounts to a Deferral Account, or the creation of any Trust and the deposit of
such Stock thereof, except at such time as Stock may be actually delivered in
settlement of a Deferral Account.  No provision of the Plan or transaction
hereunder shall confer upon any Participant any right to be employed by the
Company or a Subsidiary thereof, or to interfere in any way with the right of
the Company or a Subsidiary to increase or decrease the amount of any
compensation payable to such Participant.  Subject to the limitations set forth
in Section 13(a) hereof, the Plan shall inure to the benefit of, and be binding
upon, the parties hereto and their successors and assigns.

 

(f)            Tax Withholding.  The Company and any Subsidiary shall have the
right to deduct from amounts otherwise payable in settlement of a Deferral
Account any sums that federal, state, local or foreign tax law requires to be
withheld with respect to such payment.  Stock or other property may be withheld
to satisfy such obligations in any case where taxation would be imposed upon
delivery of such Stock and other property.

 

(g)           Payment of Legal Fees.  All reasonable legal fees and costs paid
or incurred by a Participant pursuant to any dispute or question or
interpretation relating to this Plan shall be paid or reimbursed by the Company
if the Participant is successful on the merits pursuant to a legal judgment,
arbitration or settlement.

 

(h)           Governing Law.  The validity, construction, and effect of the Plan
and any rules and regulations relating to the Plan shall be determined in
accordance with the laws of the Commonwealth of Pennsylvania, without giving
effect to principles of conflicts of laws, and applicable provisions of federal
law.

 

(i)            Limitation.  A Participant and his or her Beneficiary shall
assume all risk in connection with any decrease in value of his or her Deferral
Account(s) and neither the Company, the Committee nor the Administrator shall be
liable or responsible therefor.

 

(j)            Construction.  The captions and numbers preceding the sections of
the Plan are included solely as a matter of convenience of reference and are not
to be taken as limiting or extending the meaning of any of the terms and
provisions of the Plan.  Whenever appropriate, words used in the singular shall
include the plural or the plural may be read as the singular.

 

(k)           Severability.  In the event that any provision of the Plan shall
be declared illegal or invalid for any reason, said illegality or invalidity
shall not affect the remaining provisions of the Plan but shall be fully
severable, and the Plan shall be construed and enforced as if said illegal or
invalid provision had never been inserted herein.

 

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(l)            Status.  The establishment and maintenance of, or allocations and
credits to, the Deferral Account(s) of any Participant shall not vest in any
Participant any right, title or interest in and to any Plan assets or benefits
except at the time or times and upon the terms and conditions and to the extent
expressly set forth in the Plan and in accordance with the terms of the Trust.

 

14.          Effective Date.  The Plan shall be effective as of October 1, 2003.

 

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