Exhibit 10.2


 


AMENDMENT TO EMPLOYMENT
AGREEMENT


 


THIS AMENDMENT TO
EMPLOYMENT AGREEMENT, made as of the 23rd day of December 2005, by and among
LEESPORT FINANCIAL CORP. (“Leesport”), a Pennsylvania business corporation
having a place of business at 1240 Broadcasting Road, Wyomissing,
Pennsylvania, LEESPORT BANK (“Leesport Bank”), a Pennsylvania banking
institution having a place of business at 1240 Broadcasting Road, Wyomissing,
Pennsylvania, and VITO A. DELISI (“Employee”), an adult individual.


 


BACKGROUND


 


1.                                       Leesport,
Leesport Bank and Employee are presently parties to an employment agreement,
made as of April 16, 2004, (the “Employment Agreement”), a copy of which is
attached as Exhibit “A.”


 


2.                                       Leesport,
Leesport Bank and Employee have agreed to certain modifications to the
Employment Agreement in connection with a reorganization and realignment of
certain business and reporting functions on a company-wide basis.  In connection with such reorganization and
realignment, Leesport, Leesport Bank and Employee have agreed that Employee
will retain the titles of Executive Vice President of Leesport Bank and
President of the Madison Bank Division of Leesport Bank, and that Employee will
continue to report directly to the Chief Executive Officer of Leesport Bank.  Leesport, Leesport Bank and Employee have
agreed, however, that Leesport or Leesport Bank can modify Employee’s duties
and responsibilities, and that such modifications will not constitute a breach
of the Employment Agreement by Leesport or Leesport Bank or an event of Good
Reason within the meaning of Section 8(d) of the Employment Agreement.


 


3.                                       In
consideration of Employee’s agreement to amend the Employment Agreement as set
forth herein, Leesport and Leesport Bank have agreed to amend the Covenant Not
to Compete or Solicit set forth in Section 9 of the Employment Agreement so
that the provisions of Section shall not apply in the event that Employee’s
employment terminates at the end of the Employment Period (as defined in
Section 4(a) of the Employment Agreement) as a result of delivery to Employee
by Leesport or Leesport Bank of a notice of nonrenewal of the Employment
Agreement in accordance with Section 4(a) of the Employment Agreement.


 


AGREEMENT:


 


NOW,
THEREFORE, the parties hereto, intending to be legally bound, agree as follows:


 


1.                                       Amendment
of Section 3 of the Employment Agreement (Duties of Employee).  Section 3 of the Employment Agreement is
hereby amended and restated in its entirety to read as follows:


 


“ Duties of Employee.  Employee shall perform such duties as an
officer of Leesport Bank as may be assigned to Employee from time to time by
the Board of Directors or the Chief Executive Officer of Leesport Bank.  Employee shall hold the titles of Executive
Vice President of Leesport Bank and President of the 


 


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Madison Bank Division of Leesport Bank, and shall hold
such other titles as may be given to him from time to time by the Board of
Directors of Leesport Bank.  Employee
shall report directly to the Chief Executive Officer of Leesport Bank.  Employee shall devote his full business time,
attention and energies to the business of Leesport Bank during the Employment
Period (as defined in Section 4 hereof); provided, however, that this
Section 3 shall not be construed as preventing Employee from engaging in
any of the following activities provided that they do not unreasonably
interfere with the performance of Employee’s duties under this Agreement:
(a) investing Employee’s personal assets; (b) performing volunteer
work for civic and charitable institutions; (c) serving on the boards of
directors of non-profit organizations or, with the prior consent of the
Chief Executive Officer of Leesport Bank, serving on the boards of directors of
for-profit organizations that do not compete with Leesport, Leesport Bank
or any of their affiliates; or (d) being involved in any other activity
with the prior approval of the Chief Executive Officer of Leesport Bank, which
approval shall not be unreasonably withheld. “


 


2.                                       Amendment
of Section 8(d) of Employment Agreement (Good Reason).  Section 8(d) of the Employment Agreement is
hereby amended and restated to read in its entirety as follows:


 


“As
used in this Agreement, “Good Reason” shall mean:  (i) a change in titles (except that a
change in title relating to Employee’s status as President of The Madison Bank
Division of Leesport Bank at any time that such Division is no longer
maintained by Leesport as permitted by the terms of the Merger Agreement shall
not constitute an event of Good Reason hereunder); (ii) a reduction by Leesport
Bank or Leesport in Employee’s Annual Base Salary or in other benefits, in the
aggregate, payable to the Employee hereunder (except that a reduction in
benefits permitted by Section 5(d) of this Agreement shall not be
considered of purposes of determining whether an event of Good Reason has
occurred hereunder); (iii) Leesport Bank or Leesport’s failure to pay the
Employee any amounts otherwise vested and due hereunder or under any plan or
policy of the Leesport Bank or Leesport; or (iv) a relocation of the
Employee’s primary place of employment, without the Employee’s expressed
written approval, to a location more than twenty (20) miles from the location
at which the Employee performed his duties as of the date of this Agreement
(except that a relocation of the Employee’s primary place of employment to
Leesport’s corporate headquarters at such time in order for the Employee to
accept a position of increased responsibilities, provided that such location is
not more than seventy (70) miles from the location at which the Employee


 


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performed
his duties as of the date of this Agreement, shall not constitute an event of
Good Reason hereunder).”


 


3.                                       Amendment
of Section 9(a) of Employment Agreement (Covenant Not to Compete or Solicit).  Section 9(a) of the Employment Agreement is
hereby amended and restated to read in its entirety as follows:


 


“(a)                           Employee hereby acknowledges and recognizes the
highly competitive nature of the business of Leesport, Leesport Bank and their
subsidiaries and affiliates and accordingly agrees that, during the Employment
Period and for a period of one (1) calendar year following termination of
Employee’s employment (except that this Section 9 shall not apply if
Leesport or Leesport Bank terminates the Employee’s employment without Cause or
the Employee terminates his employment for Good Reason or if the Employment
Period terminates as a result of delivery by Leesport or Leesport Bank of a
notice of nonrenewal), Employee shall not:


 


(i)                                     
be engaged, directly or indirectly, either for his own account or as agent,
consultant, employee, partner, officer, director, proprietor, investor (except
as an investor owning less than five percent (5%) of the stock of a publicly
owned company) or otherwise of any person, firm, corporation or enterprise
engaged in (1) the banking (including bank holding company) industry or
(2) any other activity in which Leesport, Leesport Bank or any of their
subsidiaries or affiliates is engaged (and in which Employee is also engaged)
during the Employment Period, with a 25-mile radius of any branch office
of Leesport Bank (the “Non-Competition Area”); or


 


(ii)                                  provide
financial or other significant assistance to any person, firm, corporation, or
enterprise engaged in (1) the banking (including bank holding company)
industry or (2) any other activity in which Leesport, Leesport Bank or any
of their subsidiaries or affiliates is engaged (and in which Employee is also
engaged) during the Employment Period, in the Non-Competition Area; or


 


(iii)                             solicit any person, firm,
corporation, or enterprise who or which at any time during the Employment
Period was a customer of Leesport, Leesport Bank or any of their subsidiaries
or affiliates for the purpose of providing them with products or services
competitive with those provided by any of such entities; or


 


(iv)  solicit or
hire any employees of Leesport, Leesport Bank or any of their subsidiaries or
affiliates or induce any of such


 


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employees to terminate their employment relationship
with Leesport, Leesport Bank or any of such subsidiaries or affiliates.”


 


4.                                       Ratification
of Agreement.  Except as otherwise provided
in this Amendment to Employment Agreement, all terms and conditions of the
Employment Agreement remain in full force and effect, and nothing contained in
this Amendment to Employment Agreement shall be deemed to alter or amend any
provision of the Employment Agreement except as specifically provided
herein.  References in the Employment
Agreement to the “Agreement” shall be deemed to be references to the Agreement
as amended hereby.


 


5.                                       Waiver.
No provision of this Amendment to Employment Agreement may be modified, waived,
or discharged unless such waiver, modification, or discharge is agreed to in
writing and signed by Employee and an executive officer specifically designated
by the Boards of Directors of Leesport and Leesport Bank.  No waiver by any party hereto at any time of
any breach by the other party hereto of, or compliance with, any condition or
provision of this Amendment to Employment Agreement to be performed by such
other party shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time.


 


6.                                       Assignment.  This Amendment to Employment Agreement shall
not be assignable by any party, except by Leesport or Leesport Bank Bancorp to
an affiliate of Leesport or Leesport Bank or to any successor in interest to
their respective businesses.


 


7.                                       Entire
Agreement.  This Amendment to
Employment Agreement contains the entire agreement of the parties relating to
the subject matter hereof.


 


8.                                       Successors;
Binding Agreement.


 


(a)                                  This
Amendment to Employment Agreement shall inure to the benefit of and be binding
on Leesport and Leesport Bank and any of their successors or permitted assigns.


 


(b)                                 This
Amendment to Employment Agreement shall inure to the benefit of and be
enforceable by Employee’s personal or legal representatives, executors,
administrators, heirs, distributees, devisees, and legatees.


 


9.                                       Applicable
Law.  This Agreement shall be
governed by and construed in accordance with the domestic, internal laws of the
Commonwealth of Pennsylvania, without regard to its conflicts of laws
principles.


 


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IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first
above written.


 


	
   

  	
  LEESPORT FINANCIAL CORP.

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ Robert D. Davis

  
	
   

  	
   

  	
  Robert D. Davis

  
	
   

  	
   

  	
  President and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
  Attest:

  	
  /s/ Jenette L. Eck

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (“Leesport”)

  
	
   

  	
   

  	
   

  
	
   

  	
  LEESPORT BANK

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ Robert D. Davis

  
	
   

  	
   

  	
  Robert D. Davis

  
	
   

  	
   

  	
  President and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
  Attest:

  	
  /s/ Jenette L. Eck

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  (“Leesport Bank”)

  
	
   

  	
   

  
	
   

  	
  /s/ Vito A. DeLisi

  
	
   

  	
   

  	
  Vito A. DeLisi

  
	
   

  	
   

  	
  (“Employee”)

  
					



 


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Exhibit A


 


EMPLOYMENT AGREEMENT


 


THIS EMPLOYMENT AGREEMENT
(this “Agreement”) is made as of the 16th day of April 2004, by and among
LEESPORT FINANCIAL CORP., a Pennsylvania business corporation having a place of
business at 1240 Broadcasting Road, Wyomissing, Pennsylvania 19610
(“Leesport”), LEESPORT BANK, a Pennsylvania banking institution having a place
of business at 1240 Broadcasting Road, Wyomissing, Pennsylvania 19610
(“Leesport Bank”), and VITO A. DELISI, an adult individual (“Employee”).


 


Background


 


1.     Employee
is serving as President and Chief Executive Officer of The Madison Bank
(“Madison Bank”), a Pennsylvania banking institution and a wholly owned
subsidiary of Madison Bancshares Group, Ltd. (“Madison”), pursuant to an
employment agreement, dated January 1, 2004 (the “Madison Employment
Agreement”).


 


2.     Madison
has entered into an agreement and plan of merger (the “Merger Agreement”) with
Leesport, dated the date hereof (the “Merger Agreement”), providing, among
other things for the merger of Madison with and into Leesport, with Leesport as
the surviving entity, and the subsequent merger of Madison Bank with and into
Leesport Bank, with Leesport Bank as the surviving entity. Defined terms used
herein but otherwise not defined herein shall have the meanings ascribed to
such terms in the Merger Agreement.


 


3.     Leesport
and Employee desire that Employee continue his employment with Leesport Bank
after the Merger as President of the Madison Bank Division of Leesport Bank. In
connection therewith, Leesport and Employee have agreed that (i) Employee
shall receive the payment provided in Section 20 of this Agreement in
complete satisfaction of any amounts due and owing to Employee under the
Madison Employment Agreement as a result of the Merger, (ii) the Madison
Employment Agreement shall be terminated on the Effective Date without further
obligations thereunder by any of the parties to the Madison Employment
Agreement and (iii) Employee shall continue his employment with Leesport
Bank on and after the Effective Date on the terms and conditions set forth
herein.


 


4.     Employee
agrees to accept employment with Leesport Bank on the terms and conditions set
forth herein.


 


NOW, THEREFORE, the parties
hereto, intending to be legally bound, agree as follows:


 


1.    Incorporation of Background.    The
Background provisions set forth above are hereby incorporated by reference into
this Agreement and made a part hereof as if set forth in their entirety in this
Section 1.


 


2.    Employment.    Leesport
Bank hereby employs Employee, and Employee hereby accepts employment with
Leesport Bank, as of the Effective Time of the Merger on the terms and
conditions set forth in this Agreement.


 


3.    Duties of Employee.    Employee
shall perform such duties as an officer of Leesport Bank as may be assigned to
Employee from time to time by the Board of Directors or the Chief Executive
Officer of Leesport Bank, commensurate with his position as head of a major
division of Leesport Bank. Employee shall be employed as an Executive Vice
President of Leesport Bank and President of the Madison Bank Division of
Leesport Bank to be established in accordance with the provisions of the Merger
Agreement, and shall hold such other titles as may be given to him from time to
time by the Board of Directors of Leesport Bank. Employee shall report directly
to the Chief Executive Officer of Leesport Bank. Employee shall devote his full
business time, attention and energies to the business of


 


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Leesport Bank during the Employment Period (as
defined in Section 4 hereof); provided, however, that this Section 3
shall not be construed as preventing Employee from engaging in any of the
following activities provided that they do not unreasonably interfere with the
performance of Employee’s duties under this Agreement: (a) investing
Employee’s personal assets; (b) performing volunteer work for civic and
charitable institutions; (c) serving on the boards of directors of
non-profit organizations or, with the prior consent of the Chief Executive
Officer of Leesport Bank, serving on the boards of directors of for-profit
organizations that do not compete with Leesport, Leesport Bank or any of their
affiliates; or (d) being involved in any other activity with the prior
approval of the Chief Executive Officer of Leesport Bank, which approval shall
not be unreasonably withheld.


 


4.    Term of Agreement.


 


(a)   This
Agreement shall be for a period (the “Employment Period”) commencing on the
Effective Date and ending on December 31, 2007; provided, however, that
the Employment Period shall be automatically extended on January 1, 2008
and on the same date of each subsequent year thereafter (the “Annual Renewal
Date”) for a period ending one (1) year from each Annual Renewal Date
unless Leesport Bank or Employee provides written notice of nonrenewal to the
other party at least sixty (60) days prior to an Annual Renewal Date, in
which event this Agreement shall terminate at the end of the then existing
Employment Period. The term Employment Period shall include any renewals or
extensions of the Employment Period.


 


(b)   Notwithstanding
the provisions of Section 4(a) hereof, this Agreement shall terminate
automatically for Cause (as hereinafter defined) upon written notice from the
Chief Executive Officer of Leesport Bank to Employee. As used in this Agreement,
“Cause” shall mean any of the following:


 


(i)    Employee’s
conviction of or plea of guilty or nolo contendere to a felony or a crime of
falsehood involving Leesport or Leesport Bank, or the actual incarceration of
Employee for a period of at least thirty (30) days relating to such
matters;


 


(ii)   Employee’s
willful failure to perform his material duties hereunder (other than a failure
resulting from Employee’s incapacity because of physical or mental illness)
after receipt of written notice, setting forth with particularity the
allegations of such failure, from Leesport Bank and a failure to cure such
violation within thirty (30) days of such notice, unless it is apparent
under the circumstances that Employee is unable to cure such violation, which
failure results in material injury to Leesport, Leesport Bank or any of their
subsidiaries or affiliates, monetarily or otherwise;


 


(iii)  fraud or
gross negligence on the part of Employee in the performance of his duties which
results in material injury to Leesport, Leesport Bank or any of their
subsidiaries or affiliates, monetarily or otherwise;


 


(iv)  disparaging
material public statements by Employee relating to Leesport, Leesport Bank or
any of their subsidiaries or affiliates;


 


(v)   Employee’s
breach of fiduciary duty involving personal profit; or


 


(vi)  Employee’s
removal or prohibition from being an institution-affiliated party by a final
order of an appropriate federal banking agency pursuant to Section 8(e) of
the Federal Deposit Insurance Act or by the Pennsylvania Department of Banking
pursuant to state law.


 


If this Agreement is
terminated for Cause, Employee’s rights under this Agreement shall cease as of
the effective date of such termination, except that Employee shall be entitled
to all accrued compensation and benefits as of the effective date of
termination (including, without limitation, Annual Base Salary, vacation and
expense reimbursement but excluding any pro-rated bonus) as of the effective
date of termination.


 


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(c)   Notwithstanding
the provisions of Section 4(a) hereof, this Agreement shall terminate
automatically upon Employee’s voluntary termination of employment (other than
in accordance with Section 6 hereof), retirement at Employee’s election, or
Employee’s death, and Employee’s rights under this Agreement shall cease as of
the date of such voluntary termination, retirement at Employee’s election, or
death; provided, however, that, if Employee dies after Employee delivers a
Notice of Termination (as defined in Section 6(a) hereof), the amounts
provided for in Section 7 shall remain payable and the provisions of
Section 15(b) hereof shall apply.


 


(d)   Notwithstanding
the provisions of Section 4(a) hereof, this Agreement shall terminate
automatically upon Employee’s disability and Employee’s rights under this
Agreement shall cease as of the date of such termination; provided, however,
that, if Employee becomes disabled after Employee delivers a Notice of
Termination, Employee shall nevertheless be absolutely entitled to receive all
of the compensation and benefits provided for in, and for the term set forth
in, Section 7 hereof. For purposes of this Agreement, “disability” shall
mean Employee’s incapacitation by accident, sickness or otherwise which renders
Employee mentally or physically incapable of performing the services required
of Employee for the entire period of six (6) consecutive months as
determined by a physician selected by Leesport and reasonably satisfactory to
Employee. During the six-month period referred to in the preceding sentence in
which Employee shall be mentally or physically incapable of performing the
services required of Employee prior to a termination for disability, Employee
shall be entitled to continue to receive the salary, benefits and other
compensation provided in Section 5 hereof.


 


(e)   Employee
agrees that, in the event his employment under this Agreement terminates for
any reason, Employee shall concurrently resign as a director of Leesport,
Leesport Bank or any of their subsidiaries or affiliates, if he is then serving
as a director of any such entities.


 


5.    Employment Period Compensation and Benefits.


 


(a)    Salary.    For
services performed by Employee under this Agreement, Leesport Bank shall pay
Employee an annualized base salary in the aggregate amount of Two Hundred
Thirty-Five Thousand Dollars ($235,000.00) per year during the Employment
Period (“Annual Base Salary”), payable at the same times as salaries are
payable to other Employee employees of Leesport Bank. Leesport Bank may, from
time to time, increase (but may not decrease) Employee’s Annual Base Salary,
and any and all such increases shall be deemed to constitute amendments to this
Section 5(a) to reflect the increased amounts, effective as of the date
established for such increases by the Board of Directors or any committee of
the Board of Directors of Leesport Bank in the resolutions authorizing such
increase.


 


(b)    Bonus.    For
services performed by Employee under this Agreement, Employee shall be entitled
to participate in the incentive bonus program in effect from time to time for
officers and employees of Leesport on the same basis as similarly situated
officers of Leesport Bank. The payment of any such bonus in any year shall not
reduce or otherwise affect any other obligation to Employee provided for under
this Agreement.


 


(c)    Vacation.    During
the term of this Agreement, Employee shall be entitled to paid annual vacation
in accordance with the policies established for senior Employees of Leesport
Bank, which currently is four (4) weeks paid vacation per year. Employee
shall not be entitled to receive any additional compensation from Leesport Bank
for failure to take a vacation, nor shall Employee be able to accumulate unused
vacation time from one year to the next, except to the extent specifically
authorized by the Board of Directors of Leesport Bank.


 


(d)    Employee Benefit Plans.    During
the term of this Agreement, Employee shall be entitled to participate in and
receive the benefits of any employee benefit plan available from time to time
to employees who are officers of Leesport Bank; provided, however, that nothing
contained herein


 


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shall be construed as prohibiting Leesport, Leesport
Bank or any other subsidiary of Leesport from eliminating or limiting a plan or
benefit provided that such elimination or limitation is applicable to all
officer employees generally. Employee shall receive past service credit for
service under the employee benefit plans of Madison for purposes of determining
Employee’s eligibility and any vesting requirements under any plans of
Leesport. Employee shall also receive a waiver of all waiting periods and
pre-existing condition exclusions under any Leesport plan to the extent
permitted under the terms of the applicable plan. Nothing paid to Employee
under any plan or arrangement presently in effect or made available in the
future shall be deemed to be in lieu of the salary payable to Employee pursuant
to Section 5(a) hereof.


 


(e)    Stock Options.    On
the Effective Date of the Merger, the Employee shall be granted five thousand
(5,000) incentive stock options under Leesport’s 1998 Employee Stock Incentive
Plan, as amended (the “Stock Option Plan”). Such options shall be granted with
an exercise price equal to fair market value of a share of Leesport common
stock on the Effective Date of the Merger, shall vest ratably over a period of
three (3) years from the date of grant and shall otherwise be subject to
the terms and conditions of the Plan. Employee shall be eligible to participate
in Leesport’s stock option plans and programs in effect from time to time and
will be eligible for consideration for grants under such plans for calendar
years commencing January 1, 2005, and thereafter, on the same basis as
other officers of Leesport Bank.


 


(f)    Automobile Allowance.    During
the Employment Period, Employee shall be entitled to receive a monthly
automobile allowance of One Thousand Dollars ($1,000.00) to cover all expenses,
including lease payments, fuel, maintenance and other operating expenses, of an
automobile for use in connection with Employee’s duties hereunder.


 


(g)    Split-Dollar Life Insurance Program.    After
the Effective Date, Leesport shall continue to maintain the split-dollar life
insurance plan arrangement referenced in Section 2.4 of the Madison
Employment Agreement on the same terms and conditions.


 


(h)    Country Club.    During
the Employment Period, Leesport Bank shall reimburse the Employee or otherwise
pay for membership dues and all reimbursable business-related expenses
associated with the Employee’s membership in the Plymouth Country Club in
accordance with Leesport’s expense reimbursement policies in effect from time.


 


(i)    Business Expenses.    Leesport
Bank shall reimburse the Employee or otherwise pay for all reasonable expenses
incurred by the Employee in furtherance of or in connection with the business
of Leesport Bank or Leesport in accordance with Leesport’s expense reimbursement
policies in effect from time to time.


 


6.    Termination of Employment Following Change in
Control.


 


(a)   If a
Change in Control (as defined in Section 6(b) hereof) shall occur and if
thereafter at any time during the term of this Agreement there shall be:


 


(i)    an
involuntary termination of the Employee’s employment, other than an involuntary
termination permitted in Sections 4(b) and 4(d);


 


(ii)   a
material reduction in the Employee’s duties or responsibilities as the same
existed immediately prior to public announcement of a transaction involving an
actual or potential Change in Control, or as the same may be increased
thereafter;


 


(iii)  a reduction
in the Employee’s base compensation below a level that was in effect
immediately prior to the public announcement of an actual or potential Change
in Control, or as may be increased thereafter;


 


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(iv)  the failure
to provide the Employee with a total compensation package (salary, welfare and
pension benefits, stock options and a bonus plan evaluated on the basis of
bonus potential) reasonably comparable to the compensation package provided to
the Employee immediately prior to the public announcement of an actual or
potential Change in Control, or as may be increased thereafter;


 


(v)   the
reassignment of the Employee to a principal office which is more than
thirty-five (35) miles from the Employee’s primary residence as of the
date of the public announcement of an actual or potential Change in Control; or


 


(vi)  any material
breach of this Agreement by Leesport or Leesport Bank, coupled with the failure
to cure the same within thirty (30) days after receipt of written notice
of such breach from the Employee.


 


then, at the option of
Employee, exercisable by Employee within one hundred twenty (120) days of
the occurrence of any of the foregoing events, Employee may resign from
employment with Leesport Bank (or, if involuntarily terminated, give notice of
intention to collect benefits under this Agreement) by delivering a notice in
writing (the “Notice of Termination”) to Leesport and Leesport Bank and the
provisions of Section 7 of this Agreement shall apply.


 


(b)   As used
in this Agreement, “Change in Control” shall mean the occurrence of any of the
following:


 


(i)    any
“person” (as such term is used for purposes of Section 13(d) of the
Securities Exchange Act of 1934 (the “Exchange Act”) as in effect on the date
hereof), other than Leesport, a subsidiary of Leesport, or an employee benefit
plan of Leesport or a subsidiary of Leesport (including a related trust),
becomes the beneficial owner (as determined pursuant to Rule 13d-3 under
the Exchange Act), directly or indirectly of securities of Leesport
representing more than 24.9% of (A) the combined voting power of
Leesport’s then outstanding stock and securities or (B) the aggregate
number of shares of Leesport’s then outstanding common stock;


 


(ii)   the
occurrence of a sale of all or substantially all of the assets of Leesport or
Leesport Bank to an entity which is not a direct or indirect subsidiary of
Leesport;


 


(iii)  the
occurrence of a reorganization, merger, consolidation or similar transaction
involving Leesport, unless (A) the shareholders of Leesport immediately
prior to the consummation of any such transaction initially thereafter own
securities representing at least a majority of the voting power of the
surviving or resulting corporation and (B) the directors of Leesport
immediately prior to the consummation of such transaction initially thereafter
represent at least a majority of the directors of the surviving or resulting
corporation;


 


(iv)  a plan of
liquidation or dissolution, other than pursuant to bankruptcy or insolvency, is
adopted for Leesport or Leesport Bank;


 


(v)   during
any period of two consecutive years, individuals who, at the beginning of such
period, constituted the Board of Directors of Leesport cease to constitute the
majority of such Board (unless the election of each new director was expressly
or by implication approved by a majority of the Board members who were still in
office and who were directors at the beginning of such period); and


 


(vi)  the
occurrence of any other event which is irrevocably designated as a “change in
control” for purposes of this Agreement by resolution adopted by a majority of
the then non-employee directors of Leesport.


 


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7.    Rights in Event of Termination of Employment
Following Change in Control.


 


(a)   In the
event that Employee delivers a Notice of Termination to Leesport and Leesport
Bank, Employee shall be absolutely entitled to receive the compensation
determined in the manner set forth below:


 


(i)    Leesport
or Leesport Bank shall make (or cause to be made) a lump-sum cash payment to
Employee no later than thirty (30) days following the date of such
termination in an amount equal to the greater of (A) two (2) times
the sum of (i) Employee’s then Annual Base Salary and (ii) the
average of the amount(s) paid to him (or otherwise accrued) annually under
Section 5(b) during the Employment Period or (B) the present value of
the series of payments that would be made to him, pursuant to
Section 8(a)(i), if his termination were governed by Section 8.


 


(ii)   For
purposes of Section 7(a)(i) hereof, the present value of each payment
described in Clause (B) of Section 7(a)(i) shall be determined
using the relevant “applicable federal rate(s)” in effect under
Section 1274 of the Internal Revenue Code of 1986, as amended (the “Code”),
on the date of Employee’s termination of employment.


 


(iii)  In no event
shall the termination payment otherwise required under this section be made to
the extent it would trigger a reduction in tax deductions under Code
Section 280G. If Code Section 280G would apply to such payment when
made, the amount of such payment shall be reduced to the maximum amount that
can be paid without triggering the reduction in tax deductions. If Code
Section 280G would become applicable to the termination payment after it
is made, Employee shall be obligated to repay such amount as may be necessary
to avoid such application, determined as provided in the last sentence of
Section 8(a) hereof.


 


(b)   Employee
shall not be required to mitigate the amount of any payment provided for in
this Section 7 by seeking other employment or otherwise. The amount of
payment provided for in this Section 7 shall not be reduced by any
compensation earned by Employee as the result of employment by another employer
or by reason of Employee’s receipt of or right to receive any retirement or
other benefits after the date of termination of employment or otherwise.


 


8.    Rights in Event of Termination of Employment
Absent Change in Control.


 


(a)   Provided
that no Change in Control shall have occurred at the date of termination, in
the event that Employee’s employment is terminated by Leesport Bank other than
for death, disability or Cause or Employee terminates his employment for Good
Reason (as hereinafter defined), Leesport or Leesport Bank shall: (i) pay
(or cause to be paid), in the aggregate, to Employee in cash, an amount equal
to the sum of (A) Employee’s Annual Base Salary in effect on the date of
termination and (B) the average of the amount(s) paid to him (or otherwise
accrued) annually under Section 5(b) during the Employment Period, divided
in each case by the number of pay periods during a year, for the greater of
(1) a period of twelve (12) months or (2) the remainder of the
then existing Employment Period, paid at the same intervals as the salary is
payable under Section 5(a) hereof; and (ii) maintain and provide to
the Employee, at no cost to the Employee, for a period ending at the earliest
of (A) the expiration of twelve (12) months from the Employee’s last
day of active employment, (B) the date of the Employee’s full-time
employment by another employer, (C) the date Employee receives medical
benefit coverage equivalent to that provided to Employee on the date of
termination from another entity which has engaged Employee to perform services,
or (D) the Employee’s death, medical benefits coverage for the Employee
which the Employee would have been entitled to receive had his employment with
Leesport Bank continued throughout such period.


 


(b)   Employee
shall not be required to mitigate the amount of any payment provided for in
this Section 8 by seeking other employment or otherwise. The amount of
payments provided for in


 


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this Section 8 shall not be reduced by
any compensation earned by Employee as the result of employment by another
employer or by reason of Employee’s receipt of or right to receive any
retirement or other benefits after the date of termination of employment or
otherwise.


 


(c)   The
amounts payable pursuant to this Section 8 shall constitute Employee’s
sole and exclusive remedy in the event of involuntary termination of Employee’s
employment in the absence of a Change in Control.


 


(d)   As used
in this Agreement, “Good Reason” shall mean: (i) the material reduction in
Employee’s duties, responsibilities or authority or a change in titles (except
that a change in title relating to Employee’s status as President of The
Madison Bank Division of Leesport Bank at any time that such Division is no
longer maintained by Leesport as permitted by the terms of the Merger Agreement
shall not constitute an event of Good Reason hereunder); (ii) a reduction
by Leesport Bank or Leesport in Employee’s Annual Base Salary or in other
benefits, in the aggregate, payable to the Employee hereunder (except that a reduction
in benefits permitted by Section 5(d) of this Agreement shall not be
considered of purposes of determining whether an event of Good Reason has
occurred hereunder); (iii) Leesport Bank or Leesport’s failure to pay the
Employee any amounts otherwise vested and due hereunder or under any plan or
policy of the Leesport Bank or Leesport; or (iv) a relocation of the
Employee’s primary place of employment, without the Employee’s expressed
written approval, to a location more than twenty (20) miles from the
location at which the Employee performed his duties as of the date of this
Agreement (except that a relocation of the Employee’s primary place of
employment to Leesport’s corporate headquarters at such time in order for the
Employee to accept a position of increased responsibilities, provided that such
location is not more than seventy (70) miles from the location at which
the Employee performed his duties as of the date of this Agreement, shall not
constitute an event of Good Reason hereunder).


 


9.    Covenant Not to Compete or Solicit.


 


(a)   Employee
hereby acknowledges and recognizes the highly competitive nature of the
business of Leesport, Leesport Bank and their subsidiaries and affiliates and
accordingly agrees that, during the Employment Period and for a period of one
(1) calendar year following termination of Employee’s employment (except
that this Section 9 shall not apply if Leesport or Leesport Bank
terminates the Employee’s employment without Cause or the Employee terminates
his employment for Good Reason), Employee shall not:


 


(i)    be
engaged, directly or indirectly, either for his own account or as agent,
consultant, employee, partner, officer, director, proprietor, investor (except
as an investor owning less than five percent (5%) of the stock of a publicly
owned company) or otherwise of any person, firm, corporation or enterprise
engaged in (1) the banking (including bank holding company) industry or
(2) any other activity in which Leesport, Leesport Bank or any of their
subsidiaries or affiliates is engaged (and in which Employee is also engaged)
during the Employment Period, with a 25-mile radius of any branch office of
Leesport Bank (the “Non-Competition Area”); or


 


(ii)   provide
financial or other significant assistance to any person, firm, corporation, or
enterprise engaged in (1) the banking (including bank holding company)
industry or (2) any other activity in which Leesport, Leesport Bank or any
of their subsidiaries or affiliates is engaged (and in which Employee is also
engaged) during the Employment Period, in the Non-Competition Area; or


 


(iii)  solicit any
person, firm, corporation, or enterprise who or which at any time during the
Employment Period was a customer of Leesport, Leesport Bank or any of their


 


7





















 


subsidiaries or affiliates for the purpose of
providing them with products or services competitive with those provided by any
of such entities; or


 


(iv)  solicit or
hire any employees of Leesport, Leesport Bank or any of their subsidiaries or
affiliates or induce any of such employees to terminate their employment
relationship with Leesport, Leesport Bank or any of such subsidiaries or
affiliates.


 


(b)   It is
expressly understood and agreed that, although Employee and Leesport and
Leesport Bank consider the restrictions contained in Section 9(a) hereof
reasonable for the purpose of preserving the good will and other proprietary
rights of Leesport, Leesport Bank and their subsidiaries and affiliates, if a
final judicial determination is made by a court having jurisdiction that the
time or territory or any other restriction contained in Section 9(a)
hereof is an unreasonable or otherwise unenforceable restriction against
Employee, the provisions of Section 9(a) hereof shall not be rendered void
but shall be deemed amended to apply as to such maximum time and territory and
to such other extent as such court may judicially determine or indicate to be
reasonable.


 


10.    Unauthorized Disclosure.    During
the term of his employment hereunder, or at any later time, Employee shall not,
without the written consent of the Board of Directors of Leesport, the Chief
Executive Officer of Leesport or a person authorized by any of them, knowingly
disclose to any person, other than an employee of Leesport or Leesport Bank, or
any of their respective subsidiaries or affiliates, or a person to whom
disclosure is reasonably necessary or appropriate in connection with the
performance by Employee of his duties as an employee of Leesport Bank, any material
confidential information obtained by him while in the employ of Leesport Bank
with respect to any of Leesport’s, Leesport Bank’s and their subsidiaries’ and
affiliates’ services, products, improvements, formulas, designs or styles,
processes, customers, methods of business or any business practices the
disclosure of which could be or will be damaging to Leesport, Leesport Bank or
any of their subsidiaries or affiliates; provided, however, that confidential
and proprietary information shall not include any information known generally
to the public (other than as a result of unauthorized disclosure by Employee or
any person with the assistance, consent or direction of Employee) or any
information of a type not otherwise considered confidential by persons engaged
in the same business or a business similar to that conducted by Leesport,
Leesport Bank or any of their subsidiaries or affiliates, or any information
that must be disclosed as required by law or legal process.


 


11.    Notices.    Except
as otherwise provided in this Agreement, any notice required or permitted to be
given under this Agreement shall be deemed properly given if in writing and if
mailed by registered or certified mail, postage prepaid with return receipt
requested, to Employee’s residence, in the case of notices to Employee, and to
the principal Employee offices of Leesport and Leesport Bank, in the case of
notices to Leesport and Leesport Bank.


 


12.    Waiver.    No
provision of this Agreement may be modified, waived or discharged unless such
waiver, modification or discharge is agreed to in writing and signed by
Employee and an executive officer specifically designated by the Board of
Directors of Leesport or Leesport Bank. No waiver by a party hereto at any time
of any breach by the other party hereto of, or compliance with, any condition
or provision of this Agreement to be performed by such other party shall be
deemed a waiver of similar or dissimilar provisions or conditions at the same
or at any prior or subsequent time.


 


13.    Assignment.    This
Agreement shall not be assignable by any party, except by Leesport and Leesport
Bank to any successor in interest to their respective businesses.


 


14.    Entire Agreement.    This
Agreement contains the entire agreement of the parties relating to the subject
matter of this Agreement.


 


8





















 


15.    Successors, Binding Agreement.


 


(a)   Leesport
and Leesport Bank will require any successor (whether direct or indirect, by
purchase, merger, consolidation, or otherwise) to all or substantially all of
the businesses and/or assets of Leesport and Leesport Bank to expressly assume
and agree to perform this Agreement in the same manner and to the same extent
that Leesport and Leesport Bank would be required to perform it if no such
succession had taken place. Failure by Leesport and Leesport Bank to obtain
such assumption and agreement prior to the effectiveness of any such succession
shall constitute a breach of this Agreement and the provisions of Sections 4, 6
and 7 of this Agreement shall apply. As used in this Agreement, “Leesport” and
“Leesport Bank” shall mean Leesport and Leesport Bank as defined previously and
any successor to their respective businesses and/or assets as aforesaid which
assumes and agrees to perform this Agreement by operation of law or otherwise.


 


(b)   This
Agreement shall inure to the benefit of and be enforceable by Employee’s
personal or legal representatives, executors, administrators, heirs,
distributees, devisees and legatees. If Employee should die after either a
Notice of Termination is delivered by Employee, or following termination of
Employee’s employment without Cause, and any amounts would be payable to
Employee under this Agreement if Employee had continued to live, all such
amounts shall be paid in accordance with the terms of this Agreement to
Employee’s devisee, legatee, or other designee, or, if there is no such
designee, to Employee’s estate.


 


16.    Arbitration.    Leesport,
Leesport Bank and Employee recognize that, in the event a dispute should arise
between them concerning the interpretation or implementation of this Agreement,
lengthy and expensive litigation will not afford a practical resolution of the
issues within a reasonable period of time. Consequently, each party agrees that
all disputes, disagreements and questions of interpretation concerning this
Agreement are to be submitted for resolution in a location mutually agreed to
by Leesport and Employee, or, in the absence of such agreement, Philadelphia, Pennsylvania,
to the American Arbitration Association (the “Association”) in accordance with
the Association’s National Rules for the Resolution of Employment Disputes or
other applicable rules then in effect (“Rule”). Leesport and Leesport Bank or
Employee may initiate an arbitration proceeding at any time by giving notice to
the other in accordance with the Rules. Leesport, Leesport Bank and Employee,
may, as a matter or right, mutually agree on the appointment of a particular
arbitrator from the Association’s pool. The arbitrator shall not be bound by
the rules of evidence and procedure of the courts of the Commonwealth of
Pennsylvania but shall be bound by the substantive law applicable to this
Agreement. The decision of the arbitrator, absent fraud, duress, incompetence
or gross and obvious error of fact, shall be final and binding upon the parties
and shall be enforceable in courts of proper jurisdiction. Following written
notice of a request for arbitration, Leesport, Leesport Bank and Employee shall
be entitled to an injunction restraining all further proceedings in any pending
or subsequently filed litigation concerning this Agreement, except as otherwise
provided herein.


 


17.    Validity.    The
invalidity or unenforceability of any provision of this Agreement shall not
affect the validity or enforceability of any other provision of this Agreement,
which shall remain in full force and effect.


 


18.    Applicable Law.    This
Agreement shall be governed by and construed in accordance with the domestic,
internal laws of the Commonwealth of Pennsylvania, without regard to its
conflicts of laws principles.


 


19.    Headings.    The
section headings of this Agreement are for convenience only and shall not
control or affect the meaning or construction or limit the scope or intent of
any of the provisions of this Agreement.


 


20.    Effective Date; Change in Control Payment;
Termination of Madison Employment Agreement and Prior Severance Agreements.    This
Agreement shall become effective only at the Effective Time of the


 


9





















 


Merger. Prior to the Effective Time, neither
Leesport, Leesport Bank, nor any of their respective subsidiaries or affiliates
shall have any obligation to Employee hereunder or otherwise. Effective at the
Effective Time of the Merger, the Madison Employment Agreement, and any other
agreement, arrangement or understanding between Employee and Madison relating
to Employee’s employment or compensation, shall terminate and be of no further
force and effect. Notwithstanding the preceding sentence, on the Closing Date,
Employee shall receive, in complete satisfaction of any rights of Employee
under the Madison Employment Agreement or any other agreement, arrangement or
understanding with Madison (including without limitation Section 3.5 of
the Madison Employment Agreement), a lump-sum cash payment in the amount of Six
Hundred Fifty-Two Thousand Six Hundred Fifty Dollars ($652,650.00) or such
lesser amount as may be necessary such that such payment, together with all
other amounts or benefits provided to or on behalf of Employee in connection
with the Merger would not result in the reduction of tax deductions under Code
Section 280G.


 


[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK]


 


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IN WITNESS WHEREOF, the
parties have executed this Agreement as of the date first above written.


 


	
   

  	
  LEESPORT FINANCIAL CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Raymond H.
  Melcher, Jr.

  
	
   

  	
   

  	
  Name: Raymond H. Melcher,
  Jr.

  
	
   

  	
   

  	
  Title: Chairman, President
  and Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  ATTEST:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jenette L. Eck

  
	
   

  	
   

  	
  Name: Jenette L. Eck

  
	
   

  	
   

  	
  Title: Secretary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  “Leesport”

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  LEESPORT BANK

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Raymond H.
  Melcher, Jr.

  
	
   

  	
   

  	
  Name: Raymond H. Melcher,
  Jr.

  
	
   

  	
   

  	
  Title: Chairman, President
  and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ATTEST:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jenette L. Eck

  
	
   

  	
   

  	
  Name: Jenette L. Eck

  
	
   

  	
   

  	
  Title: Secretary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  “Leesport Bank”

  
	
   

  	
   

  
	
   

  	
   

  
	
  WITNESS:

  	
   

  
	
   

  	
   

  
	
   /s/ E. Cheryl Hinkle
  Richards

  	
   

  	
  /s/ Vito A. DeLisi

  	
  (SEAL)

  
	
   

  	
  Vito A. DeLisi

  	
   

  
	
   

  	
   

  
	
   

  	
  “Employee”

  
					



 


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