Tompkins Financial Corporation 10-Q 


 


Exhibit 10.7


 


AMENDED AND RESTATED

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT


 


This Amended and Restated Supplemental
Executive Retirement Agreement (the “Agreement”) is entered into effective November 9, 2016, by Tompkins Financial
Corporation, with offices at 110 The Commons, Ithaca, New York 14851, and Gerald J. Klein, Jr., residing at _____________________
(the “Executive”).


 


PREAMBLE


 


The Executive and Tompkins Financial Corporation
previously entered into a Supplemental Executive Retirement Agreement, dated on or about January 1, 2004 (the “Original
Agreement”), and Section 8.1 hereof sets forth the only provision of the Original Agreement which is incorporated into
this Agreement. For good and valuable consideration, including without limitation (i) continued active participation and other
benefits under this Agreement, (ii) an additional Supplemental Executive Retirement Agreement, also dated on or about the date
hereof, and (iii) the grant of an equity award on or about the date hereof, which equity award is expressly conditioned upon Executive’s
execution and delivery of this Agreement, the receipt and sufficiency of which is acknowledged, the parties now desire to clarify,
amend and restate the Original Agreement as set forth herein. The principal objective of this Agreement and the Original Agreement
is and was to ensure the payment of competitive levels of retirement income to the Executive, who has been determined to be a key
executive of Tompkins Financial Corporation and its subsidiaries, in order to retain and motivate such Executive.


 


SECTION I. DEFINITIONS


 


		1.1.	“Board of Directors” means the Board of Directors of Tompkins Financial Corporation.



 


		1.2.	“Cause” has the meaning set forth in Section 2.3.



 






     


     


    

 


		1.3.	“Code” means the Internal Revenue Code of 1986, as amended.



 


		1.4.	“Competition with the Company” has the meaning set forth in Section 2.3.



 


		1.5.	“Committee” means the Compensation Committee of the Board of Directors, which
has been given authority by the Board of Directors to administer this Agreement.



 


		1.6.	“Company” means Tompkins Financial Corporation.



 


		1.7.	“Compensation” has the meaning set forth in Section 7.1(b).



 


		1.8.	“Disabled” means that by reason of any medically determinable physical or mental
impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12)
months, the Executive is unable to engage in any substantial gainful activity.



 


		1.9.	“Early Retirement Reduction” has the meaning set forth in Section 3.1.



 


		1.10.	“Earnings” means the average of the Executive’s five (5) highest calendar
years (or such lesser number if the Executive has not completed five (5) years of service for the purpose of determining Earnings)
of base pay, which shall mean the Executive’s base salary excluding bonuses, profit sharing, and the like, and which may
include base pay in years prior to the Executive’s commencement of participation under this Agreement if so determined by
the Board of Directors.



 


		1.11.	“Excise Tax” has the meaning set forth in Section 7.1(c).



 


		1.12.	“Good Reason” exists in the event of (i) a material diminution in the Executive’s
base compensation, authority, duties or responsibilities; (ii) a material change in the geographic location at which the Executive
is required to perform the duties of the Executive’s position; or (iii) a material breach of this Agreement by the Company
or its successor, or of any other agreement pursuant to which the Executive provides services for the Company or its successor,
provided the Executive gives written notice to the Company or its successor, as applicable, within ninety (90) days of the initial
existence of the condition described in (i), (ii) or (iii), above, and the Company or its successor fails to remedy such condition
within thirty (30) days after receipt of such notice.



 






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		1.13.	“Release” has the meaning set forth in Section 8.11.



 


		1.14.	“Release Date” has the meaning set forth in Section 8.11.



 


		1.15.	“Retirement Age” has the meaning set forth in Section 2.2.



 


		1.16.	“Retirement Benefit Freeze” has the meaning set forth in Section 2.1.



 


		1.17.	“Retirement Date” has the meaning set forth in Section 2.2.



 


		1.18.	“Surviving Spouse” means the spouse of the Executive, if any, designated at
or prior to his Retirement Date on his ‘Beneficiary Designation Form’, surviving on the date of death of the Executive;
provided, however, that if the Executive, as of the date of Executive’s death, is no longer married to the person so designated,
then such person is not a Surviving Spouse for purposes of this Agreement.



 


		1.19.	“Vested” means having completed at least (ten) 10 years of service beginning
on the date set forth in Section 3.3.



 


		1.20.	“Years of Service Reduction” has the meaning set forth in Section 3.1.



 


SECTION II. ELIGIBILITY FOR BENEFITS


 


2.1           Eligibility.
The Executive is eligible to participate in this Agreement by designation of the Board of Directors, in its sole discretion. The
Board of Directors may determine, in its sole discretion, that the Executive should cease to continue accruing retirement benefits
under this Agreement (a “Retirement Benefit Freeze”) and in such event the Board of Directors shall notify the
Executive in writing of such determination. Such determination shall not reduce the then accrued retirement benefit of the Executive
under this Agreement, as follows. The Executive will remain entitled to receive his retirement benefit in accordance with Section
3.1 (and Executive will be deemed Vested), except that the Years of Service Reduction shall be calculated utilizing the years of
service completed by Executive as of the Retirement Benefit Freeze date, and Earnings shall be calculated as of the Retirement
Benefit Freeze date. A Retirement Benefit Freeze will not impair Executive’s rights under Section 7 (Change in Control) and
Section 9 (Severance), except as expressly set forth herein.


 






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2.2           Retirement
Date. The Executive is eligible to retire under this Agreement and receive a benefit under Section 3.1 beginning on his “Retirement
Date” which is the later of: (a) the first day of the month following the month in which the Executive reaches age fifty-five
(55) (which age is referred to as the “Retirement Age” herein), or (b) the first day of the month following
the month in which the Executive terminates employment with the Company.


 


2.3           Termination;
Competition. Anything herein to the contrary notwithstanding, if within two (2) years after involuntary termination (including
resignation with Good Reason), the Executive engages in Competition with the Company (without prior authorization given by the
Committee in writing), or, if the Executive is discharged by the Company or its subsidiaries for Cause, payments otherwise payable
under this Agreement to the Executive or the Executive’s Surviving Spouse will, in the sole discretion of the Committee,
be forfeited and the Company will have no further obligation under this Agreement to the Executive or the Executive’s Surviving
Spouse. Anything herein to the contrary notwithstanding, no benefits are payable under this Agreement if the Executive engages
in Competition with the Company at any time before, during or after his voluntary resignation (except in the case of Competition
with the Company that begins more than two (2) years after a resignation with Good Reason). For purposes of this Agreement, the
term “Cause” shall mean (a) the conviction of the Executive by a court of competent jurisdiction of a crime which constitutes
a felony under any state or federal law, (b) an act by the Executive which in the reasonable opinion of the Board of Directors
constitutes an intentional theft of property of the Company or its subsidiaries, (c) the willful and continued failure or refusal
of the Executive to perform his duties, or (d) gross negligence or willful misconduct on the part of the Executive that is materially
and demonstrably detrimental to the Company or its subsidiaries (as determined by the Board of Directors in its reasonable discretion).
For purposes of this Section 2.3, “Competition with the Company” shall occur if the Executive, directly or indirectly,
(a) comes to own, manage, operate, control, be employed by or participate in the ownership, management, operation or control of,
or be connected in any other manner with, any business (but which shall exclude executive’s ownership of less than 1% of
any class of equity or debt security of a publicly-traded competing business) which, in the judgment of the Board of Directors,
is in substantial competition with the Company (unless the Executive has first obtained the Board’s prior written consent)
and which is located within, or is actively directing marketing efforts within, ten (10) miles of any location of the Company or
any of its subsidiaries, (b) solicits customers of the Company or any of its subsidiaries to reduce or stop doing business with
the Company or any of its subsidiaries, or initiates any customer contact, for any reason, except for social contact with customers
with whom Executive has a long-standing social or familial relationship, and such contact leads to the Company/subsidiary’s
loss of business or business opportunities, or (c) solicits employees of the Company or any of its subsidiaries to leave such employment,
or offers employment to employees of the Company or any of its subsidiaries, or initiates any employee contact, for any reason,
except for social contact with employees with whom Executive has a long-standing social or familial relationship, and such contact
leads to the Company/subsidiary’s loss of such employee’s services.


 






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SECTION III. AMOUNT AND FORM OF RETIREMENT
BENEFIT


 


3.1           Retirement
Benefit. The annual retirement benefit amount payable by the Company under this Agreement shall equal seventy-five percent
(75%) of the Executive’s Earnings less (a) the hypothetical value of the annual amount of a single life annuity for the
life of the Executive determined as if the accrual of benefits under the Tompkins Financial Corporation Retirement Plan had not
been frozen, based upon the Executive’s relevant age, service, and compensation as in effect at the time such determination
of value is made, and using the benefit formula in the Tompkins Financial Corporation Retirement Plan as of the date the accrual
of further benefits under the Tompkins Financial Corporation Retirement Plan was frozen, and (b) the annual amount of the Executive’s
Social Security benefits (with the amounts in subsections (a) and (b) based upon the Committee’s good faith estimate of
the amounts of such benefits); provided, however, that the annual retirement benefit shall be reduced by five percent (5%) for
each year that the Executive’s years of service under this Agreement are less than twenty (20) years (the “Years
of Service Reduction”). The monthly retirement benefit payable by the Company to the Executive shall equal one-twelfth
(1/12) of such annual retirement benefit. In the event the Executive’s Retirement Date under Section 2.2 occurs prior to
the Executive attaining the age of sixty-five (65), the annual retirement benefit otherwise determined hereunder shall be further
reduced by five percent (5%) for each year of age by which the Executive’s attained age at his Retirement Date is less than
sixty-five (65) years (the “Early Retirement Reduction”). For clarity, when this Agreement states that an Executive
is “deemed Vested,” such does not alter the Years of Service Reduction or the Early Retirement Reduction, and is only
intended to confirm that the Executive is eligible for the benefit hereunder.




 






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The monthly benefit
payable as a single life annuity shall be payable by the Company on the first day of each calendar month beginning with the Executive’s
Retirement Date through and including the month of the Executive’s death. In the event the Executive is determined to be
a “specified employee”, as such term is defined in Treasury Regulations §1.409A-1(i), then any monthly benefit
otherwise payable on or before the date which is six (6) months after the Executive’s termination of employment date shall
be delayed until the earlier of the Executive’s date of death or the date which is six (6) months after the Executive’s
termination of employment date; provided, however, that such delay is only required for benefits constituting nonqualified deferred
compensation under Code Section 409A, and the delay will apply only to those benefits that are not exempt from Code Section 409A.
Any such delayed payments shall be accumulated and paid in a lump sum and payments thereafter will be made as scheduled in accordance
with this Section 3.1.


 






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3.2           Death
Benefit.


 


(a)       Upon
the death of the Executive after the commencement of the Executive’s retirement benefit under Section 3.1, the Executive’s
Surviving Spouse, if any, shall be entitled to an annual retirement benefit payable by the Company under this Agreement equal to
fifty percent (50%) of the annual retirement benefit which the Executive had been receiving. The monthly retirement benefit payable
by the Company to the Surviving Spouse shall be one-twelfth (1/12) of such annual retirement benefit and shall be payable on the
first day of each month beginning with the month after the month of the Executive’s death through and including the month
of the Surviving Spouse’s death.


 


(b)       Upon
the death of the Executive prior to the commencement of the Executive’s retirement benefit under Section 3.1, the Executive’s
Surviving Spouse, if any, shall be entitled to an annual retirement benefit payable by the Company under this Agreement equal to
fifty percent (50%) of the annual retirement benefit, determined under Section 3.1, provided that all of the following conditions
are satisfied: (A) the annual retirement benefit shall be payable only if the Executive is Vested at the time of his death, as
defined in Section I; and, (B) the Surviving Spouse survives until the date upon which the Executive would have attained his Retirement
Age if the Executive’s death occurs prior to his Retirement Date. The monthly retirement benefit payable by the Company,
if any, under this subsection to the Surviving Spouse shall equal one-twelfth (1/12) of said annual retirement benefit for the
Surviving Spouse and shall be payable on the first day of each month commencing on the later of the Executive’s Retirement
Age or the month after the month of the Executive’s death through and including the month of the Surviving Spouse’s
death. The date utilized for the Years of Service Reduction shall be the date of the Executive’s death (or the date of the
Executive’s termination of employment, if earlier), and the age utilized for the Early Retirement Reduction shall be the
greater of (1) the Executive’s actual age at the time of his death (or the date of the Executive’s termination of employment,
if earlier), and (2) the Retirement Age.


 






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(c)       Upon
the death of the Executive with no Surviving Spouse, or, if in the event of the Executive’s death prior to the commencement
of the Executive’s retirement benefit under Section 3.1, the Executive’s Surviving Spouse shall not survive the Executive
until the date upon which the Executive would have attained the Retirement Age, there shall be no benefit payment under Section
3 to the Executive, the Executive’s Surviving Spouse, the estate of either the Executive or the Surviving Spouse, or otherwise.


 


3.3           Service.
For purposes of this Agreement, the Executive’s service shall be defined as commencing on April 10, 1995 and ending on the
date the Executive’s employment with Company or its subsidiaries is terminated, or such earlier date as shall be determined
by the Board of Directors if the Board of Directors shall determine pursuant to Section 2.1 hereof that the Executive should cease
to benefit under this Agreement (provided, however, that no such determination shall reduce the then-accrued benefit of the Executive
under this Agreement). Years of service shall be determined in years and months of service with credit provided for a full month
of service for the calendar month in which the Executive’s service commences as set forth above and the calendar month in
which the Executive’s service hereunder ceases.


 


SECTION IV. PAYMENT OF RETIREMENT
BENEFITS


 


4.1           Limitation
on Payments. Sections 2.3, 3.2, 4.2, 8.11 and 8.13 set forth the circumstances under which all further benefits payable under
this Agreement (even if Vested) are forfeited.


 






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4.2           Termination.
Notwithstanding any contrary provision herein, if the Executive terminates employment voluntarily (which shall not include resignation
with Good Reason) before attaining age fifty-five (55) and becoming Vested, the Company shall have no obligation to pay, and the
Executive shall have no right to receive, any retirement benefit under this Agreement whatsoever. In the event of the Executive’s
involuntary termination of employment (other than for Cause) or resignation with Good Reason at any time, the benefit payable to
the Executive shall be determined as set forth in Section 3.1, and payments shall commence on the Executive’s Retirement
Date (and the Executive shall be deemed Vested, though payments shall remain subject to the Years of Service Reduction). For purposes
of this provision, the date utilized for the Years of Service Reduction shall be the date of the Executive’s termination,
and the age utilized for the Early Retirement Reduction shall be Executive’s Retirement Date. In the event of the Executive’s
death prior to the commencement of benefit payments under this provision, the Executive’s Surviving Spouse shall be entitled
to receive benefit payments in accordance with the provisions and limitations of Section 3.2.


 


4.3           Health-Related Leave of Absence.
Provided there is a reasonable expectation that the Executive will return to perform services for the Company (an “Expected
Return”), the Committee may determine that the Executive has not separated from service for purposes of this Agreement
during a leave of absence of up to twenty-nine (29) months, if such leave of absence is due to 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
six months, and such impairment causes the Executive to be unable to perform the duties of his position or any substantially similar
position (a “Qualified Impairment”). For clarity, even if a Qualified Impairment and Expected Return exist,
the Committee is not obligated to defer the Employee’s separation from service during this period, and (subject to applicable
federal and state law pertaining to medical leaves of absence) the Committee may instead elect to involuntarily terminate the Executive’s
employment (other than for Cause) under Section 4.2 during this period. The determination as to the existence or absence of such
Qualified Impairment and such Expected Return will be made by an independent physician identified by the Company. If, due to a
Qualified Impairment, the Executive cannot return to perform the duties of his position or a substantially similar position for
the Company by the end of such period, the Executive will be deemed to have incurred an involuntary termination of employment (other
than for Cause) under Section 4.2 as of the first date following the end of such period.


 






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SECTION V. DEATH BENEFITS PAYABLE


 


5.1           Death
Benefit. Other than the death benefit for the Surviving Spouse under Section 3.2, Section 4.2, or Section 6.2, as applicable,
no death benefits are payable under this Agreement.


 


SECTION VI. DISABILITY BENEFITS PAYABLE


 


6.1           Disability
Benefit. In the event that the Executive becomes Disabled, as determined by an independent physician identified by the Company
(other than at a time when facts and circumstances exist under which the Company could, and does, terminate the Executive’s
employment for Cause), the Executive shall be entitled to the benefits under Section 3.1 commencing the first day of the month
following the month in which the Executive attains Social Security normal retirement age. For purposes of calculating the amount
payable under Section 3.1 and pursuant to this Section6.1, the Executive shall be deemed Vested, though payments shall remain subject
to the Years of Service Reduction; the date utilized for the Years of Service Reduction shall be the date the Executive is determined
to be Disabled; and the age utilized for the Early Retirement Reduction shall be Executive’s Retirement Date.


 






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6.2           Death
after Disability. In the event of the death of the Executive after Executive qualifies for a retirement benefit pursuant to
Section 6.1, the Executive’s Surviving Spouse shall be entitled to receive benefit payments in accordance with the provisions
and limitations of Section 3.2.


 


SECTION VII. CHANGE IN CONTROL


 


7.1           Change
in Control.


 


(a)       In
the event of a Change in Control, as defined in Section 7.2, of the Company, the Executive shall be deemed to have completed twenty
(20) years of service and is Vested in all benefits under this Agreement (though the Early Retirement Reduction shall still apply),
and the retirement benefit described in Section 3.1 shall commence at the Executive’s Retirement Date. The executive shall
not be entitled to the accelerated service completion set forth in this subsection following a Retirement Benefit Freeze, unless
the effective date of such Retirement Benefit Freeze occurs within the two-year period immediately prior to announcement of the
Change in Control and, in such event, the executive shall remain so entitled.


 






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(b)       In
the event of a Change in Control of the Company, if the employment of the Executive is thereafter involuntarily terminated without
Cause, or if the Executive voluntarily terminates employment for Good Reason (i) within two (2) years after a Change in Control,
or (ii) in anticipation of a Change in Control which then occurs within two (2) years, then the Executive shall receive a benefit,
in addition to any benefit under Section 3 of this Agreement, under this Section 7.1(b). The benefit under this Section 7.1(b)
shall be the continuation of the Executive’s Compensation, as defined below, for a period of three (3) years (payable in
accordance with the Company’s or its successor’s regular payroll procedures for executive employees, but in any event
not less frequently than monthly), plus continuation of all employee welfare benefits that the Executive was participating in (health
insurance, disability insurance, life insurance and the like) immediately prior to the Change in Control (or cash in an amount
equal to the value of the Company’s or its successor’s contributions for such welfare benefits to the extent that the
Executive is no longer eligible to participate in such programs); provided, however, that, for purposes of this Section 7.1(b),
the amount of the Executive’s Compensation taken into account shall be reduced by (20%) if the Executive has attained age
sixty-one (61), by 40% if the Executive has attained age sixty-two (62), by 60% if the Executive has attained age sixty-three (63),
by 80% if the Executive has attained age sixty-four (64), and by 100% if the Executive has attained age sixty-five (65), with all
such age determinations made as of the date of the Executive’s termination of employment. The continuation of the Executive’s
employee welfare benefits under this Section 7.1(b) shall be on the same terms and conditions (subject to the aforementioned substitution
of cash in lieu of benefit plan participation to the extent the Executive is ineligible therefor) as such employee welfare benefits
are offered to other executive employees of the Company or of its successor, as applicable, and such continuation shall be for
a three-year period even if there is no continuation payment of the Executive’s Compensation because of the 100% reduction
under the preceding sentence. For purposes of this Section VII only, the term “Compensation” shall mean the Executive’s
base pay (at the rate in effect immediately prior to the Change in Control) plus the Executive’s bonus and profit sharing
compensation (which for this purpose shall be the average of the Executive’s bonus and profit sharing compensation earned
for the two (2) most recently completed fiscal years of the Company immediately preceding the Change in Control).


 


(c)       In
the event it shall be determined that any payment or distribution by the Company to or for the benefit of the Executive (whether
paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise) would be subject to the excise
tax imposed by Section 4999 of the Code, including any successor to such statute of like import (the “Excise Tax”),
then the amount of the benefit otherwise payable under Section 7.1(b), if any, shall be reduced, but not below zero, to the maximum
amount upon which no such Excise Tax is imposed.


 






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(d)       For
purposes of this Section 7.1, the proper amounts, if any, of the Excise Tax and the adjustment under Section 7.1(c) to eliminate
the Excise Tax shall be determined in the first instance by the Company. Within forty-five (45) days of being provided with written
notice of any such determination, the Executive may provide written notice to the Committee of any disagreement, in which event
the amounts, if any, of the Excise Tax and any adjustment under Section 7.1(c) shall be determined by independent tax counsel selected
by the Company’s independent auditors. The determination of the Company (or, in the event of disagreement, the tax counsel
selected) shall be final.


 


7.2           For
purposes of this Section VII, a Change in Control shall be deemed to have occurred upon the earliest of the following: (i) the
date of acquisition by any one person, or more than one person acting as a group (as defined in Treasury Regulations §1.409A-3(i)(5)(v)(B)),
of stock of the Company that, together with stock held by such person or group, constitutes more than fifty percent (50%) of the
total fair market value or total voting power of the stock of the Company; provided, however, that if any one person, or more than
one person acting as a group, is considered to own more than fifty percent (50%) of the total fair market value or total voting
power of the stock of the Company, the acquisition of additional stock by the same person or persons shall not be deemed to result
in a Change in Control; (ii) the date a majority of members of the Company’s Board of Directors is replaced during any twelve-month
period by directors whose appointment or election is not endorsed by a majority of the members of the Company’s board of
directors before the date of the appointment or election; or (iii) the date that any one person, or more than one person acting
as a group, acquires (or has acquired during the twelve-month period ending on the date of the most recent acquisition by such
person or persons) assets from the Company that have a total gross fair market value of more than seventy percent (70%) of the
total gross fair market value of all of the assets of the Company immediately before such acquisition or acquisitions; provided,
however, that transfers of assets of the Company of any value to a related person or entity as described in Treasury Regulations
§1.409A-3(i)(5)(vii)(B) shall not be deemed to result in a Change in Control.


 






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SECTION VIII. MISCELLANEOUS


 


8.1           Termination,
Amendment and Subsequent Deferrals. The Committee may, in its sole discretion, terminate, suspend or amend this Agreement at
any time or from time to time, in whole or in part; provided, however, that no termination, suspension or amendment of this Agreement
will, without the written consent of the Executive or the Surviving Spouse (if the Executive is not then living), reduce the Executive’s
right or the right of the Surviving Spouse to receive or continue receiving a benefit accrued at the time of the termination, suspension
or amendment in accordance with this Agreement. By way of clarification it is the intent of the Parties that the benefit under
Section IX shall accrue as of the date of the Original Agreement, and the right to receive change in control benefits under Section
VII shall also accrue as of the date of the Original Agreement, subject to the limitations set forth in Section 7.1(a). The Parties
agree that a Retirement Benefit Freeze, as described in Section 2.1, shall not be deemed a reduction of rights requiring consent
hereunder. A termination or suspension of this Agreement shall not result in the acceleration of any benefit provided pursuant
to this Agreement except as permitted in connection with a plan termination satisfying the conditions set forth in Treasury Regulations
§1.409A-3(j)(ix), where the Committee decides to accelerate such benefit in accordance with the requirements of such regulation.
The provisions of this Section 8.1 shall be subordinate to the provisions of Sections 2.3, 3.2, 4.1, 4.2, 8.11 and 8.13 concerning
the forfeiture of benefits. The definition of “Retirement Date” in Section 2.2 provides for the designated time of
the retirement benefit hereunder, and the Executive may only make a subsequent deferral if the change complies with Treasury Regulations
§ 1.409A-2(b)(1) (the “Subsequent Deferral Rules”). In the event that an Executive wishes to elect to defer payment
commencement beyond his Retirement Date, he must provide written notice thereof to the Company (the “Deferral Notice”)
at least one (1) year prior to his Retirement Date, or such longer notice period as may then be required under the Subsequent Deferral
Rules. The Deferral Notice shall specify the date on which the Executive wishes to begin receiving his retirement benefit hereunder,
and such deferred payment date must be at least five (5) years later than the date the payment otherwise would have been made,
or such other period as may then be required under the Subsequent Deferral Rules. Partial deferrals will not be permitted and the
Company may refuse to honor the Deferral Notice if, in the reasonable opinion of the Company’s external legal counsel, the
Deferral Notice does not comply with the Subsequent Deferral Rules, or is otherwise reasonably likely to adversely affect the Company
under the Subsequent Deferral Rules.


 






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8.2           No
Employment Agreement; Entire Agreement. Nothing contained herein will confer upon the Executive the right to be retained in
the service of the Company or its subsidiaries, nor will it interfere with the right of the Company or its subsidiaries to discharge
or otherwise deal with the Executive without regard to the existence of this Agreement. This Agreement (which expressly includes
the Preamble), together with those certain agreements expressly referred to herein, constitute the sole and entire agreement of
the Parties with respect to the subject matter of this Agreement, and supersedes all prior and contemporaneous understandings,
agreements, representations and warranties, both written and oral, with respect to the subject matter.


 


8.3           Unfunded
Arrangement. The benefits under this Agreement are unfunded, and the Company will make benefit payments solely on a current
disbursement basis from the Company’s general assets. Notwithstanding anything herein to the contrary, the Executive and
the Executive’s Surviving Spouse, if any, shall have the status of general unsecured creditors of the Company.


 






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8.4           Assignment.
To the maximum extent permitted by law, no benefit under this Agreement shall be assignable or made subject by Executive in any
manner to alienation, sale, transfer, claims of Executive’s creditors, pledge, attachment or encumbrances of any kind.


 


8.5           Rules.
The Committee may adopt rules and regulations to assist it in the administration of this Agreement. This Agreement shall be administered
and construed entirely in the discretion of the Committee and the Board of Directors, as applicable.


 


8.6           Information.
The Executive shall receive a copy of this Agreement and the Committee will make available for inspection by the Executive a copy
of any rules and regulations used by the Committee in administering this Agreement.


 


8.7.          Construction. The masculine
gender, where appearing in this Agreement, will be deemed to include the feminine gender, and the singular may include the plural,
unless the context clearly indicates the contrary. For purposes of complying with Code Section 409A, or any successor to such statute
of like import, it is acknowledged that no benefit payments may be made under this Agreement prior to the Executive’s termination
of employment with the Company, that the payment of benefits pursuant to this Agreement may not be accelerated by the Company or
the Executive, and that there are no elections provided under the Agreement to defer compensation or to delay a payment of benefits
other than in the case of an election made pursuant to the Subsequent Deferral Rules, as described in Section 8.1.


 






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8.8           Controlling
Law. This Agreement is established under and will be construed according to the laws of the State of New York, without regard
for principles of conflicts of law. Notwithstanding the foregoing, this Agreement shall be construed consistent with the requirements
of Code Section 409A, the regulations promulgated thereunder and other official guidance relating thereto such that the operation
or terms of this Agreement do not result in the inclusion in income of any amount under such Code provision. For purposes of this
Agreement, any term hereunder relating to the Executive’s termination of employment, the Executive terminating employment,
the Executive being terminated or similar expression shall be deemed to refer to a separation from service, as defined in Treasury
Regulations §1.409A-1(h). If an amount is to be paid under this Agreement in two or more installments, each installment shall
be treated as a separate payment for purposes of Code Section 409A.


 


8.9           Legal
Expenses. The Company shall pay, upon request and documentation thereof (and not later than ninety (90) days after receipt
of such request and documentation), all reasonable legal fees and expenses which the Executive/Surviving Spouse may incur as a
result of the Company contesting the validity or enforceability of any provision of this Agreement or any claim by the Executive/Surviving
Spouse under this Agreement; provided, however, that such request is made and supporting documentation provided to
the Company by the Executive/Surviving Spouse within ninety (90) days after incurring the expense, and provided further, the Company
shall be entitled to be reimbursed by the Executive/Surviving Spouse for such amount previously paid to such Executive/Surviving
Spouse if it is finally judicially determined that such Executive’s/Surviving Spouse’s claims under this Agreement
are frivolous.


 






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8.10         Disputes
& Severability. In the event of any dispute after the occurrence of a Change in Control (as defined in Section 7.2) between
the Company and the Executive with respect to the Executive’s rights to any payment under this Agreement, the Company shall
pay all disputed amounts to the Executive in the time and manner otherwise specified by this Agreement, and, if it is finally judicially
determined that the Executive was not entitled to all or a portion of such disputed amounts, the Executive shall repay to the Company
the amount to which the Executive was not entitled, together with interest thereon at the judgment rate of interest then applicable
in New York State. If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity,
illegality or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable
such term or provision in any other jurisdiction. Upon a determination that any term or provision is invalid, illegal or unenforceable,
the court may modify this Agreement to effect the original intent of the parties as closely as possible in order that the transactions
contemplated hereby be consummated as originally contemplated to the greatest extent possible.


 


8.11         Release. In connection with
Executive’s receipt of the retirement benefit described in Section 3.1 and the severance benefit described in Section IX,
the Executive shall execute (and not revoke) a standard, customary form of release agreement (the “Release”), including
without limitation the following terms. If Executive is continuously incapacitated through the Release Date, this requirement is
waived. The Release must be given no more than ninety (90) days following the Executive’s employment termination, with sufficient
time to allow applicable revocation period(s) to expire before the end of such ninety- (90-) day period (the final day of such
90-day period to be the “Release Date”). Pursuant to the Release, the Executive, on behalf of himself and his heirs,
shall agree to waive any and all claims he or they have, had, or may have had, in each case as of the date the Executive signs
the Release, in connection with his employment by the Company or its affiliates, as against the Company, its affiliates, and its
and their directors and employees, other than claims arising out of the Company’s breach of its obligations under this Agreement.
The Release will not prohibit or restrict the Executive (or Executive’s attorney) from initiating communications directly
with, or responding to any inquiry from, or providing testimony before, any self-regulatory organization or any state or federal
regulatory authority regarding the Company or the facts or circumstances of Executive’s employment with the Company. Should
the Executive fail to return to the Company the executed Release on or before the Release Date, the Executive will forfeit all
benefits then unpaid that otherwise would have been payable to the Executive pursuant to this Agreement.


 






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8.12         Post-Employment Consulting.
Following the Executive’s termination, if the Company requests, and Executive agrees, that Executive provide occasional services
not exceeding 20% of the amount of services provided by Executive prior to his termination, the provision of such limited services
shall not extend the date of the Executive’s termination for purposes of this Agreement.


 


8.13         Non-Disparagement. The Executive
agrees and covenants that he will not at any time make, publish or communicate to any person or entity or in any public forum any
defamatory or disparaging remarks, comments, or statements concerning the Company or its businesses, or any of its employees or
directors. This section does not, in any way, restrict or impede the Executive from exercising protected rights to the extent that
such rights cannot be waived by agreement or from complying with any applicable law or regulation or a valid order of a court of
competent jurisdiction or an authorized government agency. This section does not prohibit or restrict the Executive (or Executive’s
attorney) from initiating communications directly with, or responding to any inquiry from, or providing testimony before, any self-regulatory
organization or any state or federal regulatory authority regarding the Company or the facts or circumstances of Executive’s
employment with the Company. The Company agrees and covenants that it shall cause its officers and directors to refrain from making
any defamatory or disparaging remarks, comments, or statements concerning the Executive to any third parties. In the event of the
Executive’s violation, at any time, of his commitment under this Section 8.13, the Executive will, in the discretion of the
Committee, forfeit all benefits then unpaid that otherwise would have been payable to the Executive pursuant to this Agreement.


 






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8.14         Original Agreement. This Agreement
amends, supersedes and replaces the Original Agreement in its entirety, and the Original Agreement shall no longer be of any force
or effect, except (i) where expressly referenced herein, and (ii) that years of service credit shall accrue as of the date originally
established therefor under the Original Agreement.


 


SECTION IX. SEVERANCE BENEFIT


 


9.1           Severance
Benefit. So long as Executive has completed at least one (1) year of service following the date of this Agreement (or, if this
is an amended/restated agreement, following the date of the Original Agreement), then in addition to any benefit provided under
Sections III, V and VI hereof, in the event of the Executive’s involuntary termination of employment without Cause or resignation
with Good Reason (in each case, in a termination not governed by the provisions of Section 7.1 concerning a Change in Control),
the Executive shall receive a severance benefit payable by the Company in accordance with the Company’s payroll practices
applicable to its executive employees, for a period of twelve (12) months, commencing on the Company’s first payroll date
after the Executive’s termination of employment. Upon the Executive’s death after such payments have begun but before
such payments are completed, the balance of such payments shall continue to be made to the Executive’s Surviving Spouse or,
if no Surviving Spouse survives the Executive, to the Executive’s estate. For purposes of this Section 9.1, the severance
benefits shall equal the Executive’s base salary as in effect immediately prior to the Executive’s termination of employment
date, excluding bonuses, profit sharing, and the like. In addition to the severance benefit, the Executive shall be entitled, but
not required, during the period in which a severance benefit is being paid pursuant to this Section 9.1, to participate in the
Company’s welfare benefit programs available to the Company’s executive employees, upon the same terms and conditions
as the Company may from time to time establish generally for such executive employees; provided, however, that if such continued
participation is not permitted by law or by the applicable benefit plan, the Company shall instead provide a cash payment equal
to what it would have cost the Company to continue the Executive’s participation, had such participation been permitted.


 



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IN WITNESS WHEREOF,
this Agreement has been executed this 9th day of November, 2016.


 


	 	 	 	 
	 	 	TOMPKINS FINANCIAL CORPORATION 
	 	 	 	 
	 		By:	/s/ Stephen S. Romaine
	 	 	Name:  Stephen S. Romaine
	ATTEST:  	/s/ Janet Hewitt	 	Title:  President & Chief Executive Officer
	 	 	 	 
	 	 	By:	/s/ Gerald J. Klein, Jr.
	 	 	Gerald J. Klein, Jr., Individually
	ATTEST:	/s/ Phyllis Salatino	 	 	 



 






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SUPPLEMENTAL EXECUTIVE RETIREMENT
AGREEMENT



Beneficiary Designation Form


 


As an Executive participating in a Supplemental
Executive Retirement Agreement with Tompkins Financial Corporation, I hereby designate my spouse to receive any death benefits
that may become payable under the Agreement. I understand and acknowledge no death benefit will be paid under the Agreement (a)
if the below-designated Spouse is not a “Surviving Spouse” as defined in the Agreement, or (b) if I do not return this
Spousal Benefit Designation Form, completed and executed, to the Committee on or before my Retirement Date, as defined in the Agreement.


 


Spouse’s Name: ___________________________________


 


Social Security Number: _____________________________


 


Date of Birth: ______________________________


 


Home Address: ____________________________________________________________


 


Executive’s Signature: ______________________________


 


Witness’ Signature: ______________________________


 






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