ex10-4.htm


    
      EXHIBIT
        10.4

      


      Execution
        Copy

    

     

    SETTLEMENT
      AGREEMENT

    


    This
      Settlement Agreement (the “Agreement”) is entered into as of June 25, 2007 by
      and among Martin Infanti (the “Executive”), National Penn Bancshares, Inc. (the
“NPB”), a Pennsylvania business corporation and registered bank holding company,
      and Christiana Bank & Trust Company, a Delaware bank and trust company (the
“Bank”).

    


    WITNESSETH:

    


    WHEREAS,
      NPB and Bank are entering into an Agreement of Reorganization and Merger, dated
      as of June 25, 2007 (the “Merger Agreement”); and

    


    WHEREAS,
      the NPB, Bank, and the
      Executive desire to enter into this Agreement, which shall entitle Executive
      to
      certain amounts and benefits in lieu of any and all of the amounts and benefits
      payable to the Executive under the Change in Control Agreement, dated July
      20,
      2006, by and between Bank and Executive (the “Change in Control
      Agreement”);

    


    NOW
      THEREFORE, in consideration of the foregoing and other good and valuable
      consideration, the receipt and sufficiency of which is hereby acknowledged,
      the
      Executive, NPB, and the Bank agree as follows:

    


    1.           Lump
      Sum Payment.

    


    (a)           In
      the event that (i) the Effective Date of the Merger is prior to January 1,
      2008,
      (ii) the Executive’s employment with the Bank is terminated prior to January 1,
      2008, but on or after such Effective Date and (iii) the Executive has not
      revoked the release contained in Section 4 hereof, Bank shall pay the Executive
      an amount, at such time and in such form as provided under the Change in Control
      Agreement, equal to the amount calculated under Section 4(iv)(B) of the Change
      of Control Agreement (after any required withholding, excise tax or any
      reduction pursuant to Section 5 below, if applicable) (the “Payment”),
      determined as if the date of Executive’s termination in (ii) above is the
      Executive’s “Date of Termination” as defined in the Change of Control Agreement,
      in full satisfaction of all amounts and benefits payable to the Executive under
      the Change in Control Agreement, and the terms of Section 1(b) below shall
      not
      apply.

    


    (b)           In
      the event that the Executive has not revoked the release contained in Section
      4
      and (i) the Effective Date of the Merger is on or after January 1, 2008, or
      (ii)
      the Effective Date of the Merger is prior to January 1, 2008, and Executive
      remains employed with Employer through January 1, 2008, Bank shall pay the
      Executive the Payment, determined as if the applicable date described in (x)
      or
      (y) below is the Executive’s “Date of Termination” as defined in the Change of
      Control Agreement, as soon as practicable after the later of (x) January 1,
      2008, or (y) the Effective Date, but in no event later than the fifth (5th) business
      day
      following such date, in full satisfaction of all amounts and benefits payable
      to
      the Executive under the Change in Control Agreement.

     

     

    
      
        
        

      

      
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    2.           Assistance
      Following the Closing Date. Executive acknowledges that his services
      following the Closing Date will be important to NPB and as a condition to NPB
      entering into this Agreement Executive will continue to work for CBT following
      the closing on the same terms and conditions as currently apply to his
      employment until (A) the earlier of (i) the 30th day following
      the
      conversion of the applicable CBT computer system to NPB’s computer system if
      conversion is what the integration team determines is the appropriate action
      or
      (ii) the 30th
      day following the determination by the integration team that NPB will not
      convert the applicable CBT system in the foreseeable future or (B) a date
      mutually agreed between Executive and NPB.

    


    3.           Payment
      of Fringe Benefits.  NPB agrees to provide the Executive with
      continued health, dental, life and disability coverage pursuant to the policies
      currently offered by Bank (or comparable policies offered to similarly-situated
      employees of NPB) until the earlier of eighteen (18) calendar months following
      the date on which Executive’s employment with CBT is terminated or the
      Executive’s commencement of full-time employment with a new employer, subject to
      the terms and conditions of such policies, with NPB paying all premiums and
      with
      the Executive responsible for paying the same copayments or deductibles as
      if he
      was an employee, except as set forth below in this Section 3. The health and
      dental coverage shall include any dependents of the Executive who are covered
      as
      of the date of this Agreement and who remain covered as of the Effective Date
      of
      the Merger.  In the event the Executive’s participation in any such
      plan is barred, NPB shall arrange to provide the Executive with benefits
      substantially similar to those which the Executive would otherwise have received
      under such plans from which his continued participation is barred or provide
      their economic equivalent.  In addition, notwithstanding the
      foregoing, if the provision of any of the benefits covered by this Section
      3
      would trigger the 20% tax and interest penalties under Section 409A of the
      Code,
      then the benefit(s) that would trigger such tax and interest penalties shall
      not
      be provided (collectively, the “Excluded Benefits”), and in lieu of the Excluded
      Benefits NPB shall pay to the Executive, in a lump sum within 30 days following
      termination of employment or within 30 days after such determination should
      it
      occur after termination of employment, a cash amount equal to the economic
      equivalent of such Excluded Benefits.

    


    4.           Releases.  Upon
      payment of the amount set forth in Section 1 hereof, the Executive, for himself
      and for his heirs, successors and assigns, does hereby release completely and
      forever discharge NPB and the Bank, their respective affiliates and successors
      and the current and former directors, officers, employees and agents of each
      of
      them (any and all of which are referred to below as the “Releasees”) from any
      obligation under the Change in Control Agreement (other than the obligations
      of
      NPB to provide benefits pursuant to Section 3 above which shall continue for
      the
      period specified therein). This Agreement shall not release NPB or the Bank
      from
      any of the following: (a) obligations to pay to the Executive wages earned
      up to
      the Effective Date of the Merger; (b) the payment of any of the Executive’s
      vested benefits, or honoring any of the Executive’s rights under the Employee
      Programs of the Company (including any benefits under a supplemental executive
      retirement program covering the Executive), excluding any Change in Control
      Agreement or other severance agreement, (c) the payment of the Merger
      Consideration with respect to the Executive’s common stock of Bank or stock
      options with respect to the common stock of Bank, or (d) the obligations of
      NPB
      and/or Bank under the indemnity provisions of the Merger Agreement.

     

     

    
      
        
        

      

      
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    5.           Section
      280G Cut-Back.  Notwithstanding anything in this Agreement to the
      contrary, in no event shall any payments be made or benefits provided under
      this
      Agreement, when combined with all other payments and benefits to the Executive,
      be allowed to render any such payment or benefit nondeductible under Section
      280G of the Code or to trigger an excise tax under Section 4999 of the Code.
      In
      such event, the payments and/or benefits to be provided under this Agreement
      shall be reduced, but not below zero, such that the aggregate benefits to be
      provided to the Executive do not exceed 2.99 multiplied by the Executive’s “base
      amount” (as such term is defined in Section 280G of the
      Code).   If any reduction is to be made under this Section 4, the
      Executive may specify by written notice which payments and benefits shall be
      reduced (i.e., the Executive may elect whether to have reductions made from
      either Section 1 or Section 3 hereof).

    


    6.           General.

    


    (a)           Heirs,
      Successors and Assigns.  The terms of this
      Agreement shall be binding upon the parties hereto and their respective heirs,
      successors and assigns.

    


    (b)           Final
      Agreement. This Agreement represents the entire
      understanding of the parties with respect to the subject matter hereof and
      supersedes all prior understandings, written or oral. The terms of this
      Agreement may be changed, modified or discharged only by an instrument in
      writing signed by each of the parties hereto.

    


    (c)           Withholdings.  Bank
      and NPB may withhold from any amounts payable under this Agreement such federal,
      state, or local taxes as may be required to be withheld pursuant to applicable
      law or regulation.

    


    (d)           Governing
      Law. This Agreement shall be construed, enforced and
      interpreted in accordance with and governed by the laws of the State of
      Pennsylvania, without reference to its principles of conflicts of law, except
      to
      the extent that federal law shall be deemed to preempt such state
      laws.

    


    (e)           Defined
      Terms. Any capitalized terms not defined in this
      Agreement shall have as their meaning the definitions contained in the Merger
      Agreement.

    


    (f)           Voluntary
      Action and Waiver. The Executive acknowledges that by
      his free and voluntary act of signing below, the Executive agrees to all of
      the
      terms of this Agreement and intends to be legally bound thereby. The Executive
      acknowledges that he has been advised to consult with an attorney prior to
      executing this Agreement.

    


    (g)           Counterparts.  This
      Agreement may be executed in one or more counterparts, each of which shall
      be
      deemed to be an original but all of which together shall constitute one and
      the
      same instrument.

    


    7.           Effectiveness.  Notwithstanding
      anything to the contrary contained herein, this Agreement shall be subject
      to
      consummation of the Merger in accordance with the terms of the Merger Agreement,
      as the same may be amended by the parties thereto in accordance with its


     

     

    
      
        
        

      

      
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    terms.
      In
      the event the Merger Agreement is terminated for any reason, this Agreement
      shall be deemed null and void with respect to all actions not yet taken pursuant
      to this Agreement.

    


    


    IN
      WITNESS WHEREOF, NPB and the Bank
      have each caused this Agreement to be executed by their duly authorized
      officers, and the Executive has signed this Agreement, effective as of the
      date
      first above written.

    


    
      
        	
                WITNESS:

              	
                EXECUTIVE:

              
	 	 
	 	 
	
                /s/
                  Chris J. Cusatis

              	
                /s/
                  Martin Infanti

              
	
                Name:
                  Chris J. Cusatis

              	
                Name:  Martin
                  Infanti

              
	 	 
	 	 
	 	 
	
                ATTEST:

              	
                Christiana
                  Bank & Trust Company

              
	 	 
	 	 
	 	 
	
                /s/
                  Thomas A. Campbell

              	
                By:
                  /s/ Zissimos A. Frangopoulos

              
	
                Name:
                  Thomas A. Campbell

              	
                Name:  Zissimos
                  A. Frangopoulos

              
	 	
                Title:  President
                  & CEO

              
	 	 
	 	 
	 	 
	
                ATTEST:

              	
                National
                  Penn Bancshares, Inc.

              
	 	 
	 	 
	 	 
	
                /s/
                  Sandra L. Spayd

              	
                By:
                  /s/ Glenn E. Moyer

              
	
                Name:
                  Sandra L. Spayd

              	
                Name:  Glenn
                  E. Moyer

              
	
                GE
                  VP and Secretary

              	
                Title:  President
                  & CEO

              


      

    

    


    


    


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