Document:

EX-10.1

 Exhibit 10.1 

EMPLOYMENT AGREEMENT 

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is entered into as of January 16, 2017, between Patterson-UTI Drilling Company LLC, a Texas limited liability company (the “Company”), and James M. Holcomb (“Executive”). 

W I T N E S S E T H: 

WHEREAS, Executive is employed by the Company, a wholly-owned subsidiary of Patterson-UTI Energy,
Inc., a Delaware corporation (“Parent”), and serves as President of the Company; 
 WHEREAS, the Company and
Executive desire that Executive continue his employment with the Company and service with the Company as its President, on the terms and conditions set forth below. 

WHEREAS, the Company and Executive have agreed to enter into an employment agreement on the terms and conditions, and for the consideration,
hereinafter set forth. 
 NOW THEREFORE, for and in consideration of the mutual promises, covenants and obligations contained herein, the
Company and Executive agree as follows: 
 1. Employment. 

(a) The Company agrees to employ Executive, and Executive agrees to be employed by the Company, pursuant to the terms of this Agreement
beginning as of January 1, 2017 (the “Effective Date”) and continuing for the period of time set forth in Section 3 of this Agreement, subject to the terms and conditions of this Agreement. 

(b) From and after the Effective Date, Executive shall serve in the position of President of the Company and shall report to the Chief
Executive Officer of the Company or such other senior officer as designated by the Company from time to time, with a principal place of employment at the Company’s office in the Houston, Texas metropolitan area. 

2. Duties and Responsibilities. 

(a) Executive agrees to serve in the position referred to in Section 1(b) hereof and to perform diligently and to the best of Executive’s
abilities the usual and customary duties and services appertaining to such position, as well as such additional duties and services appropriate to such position which the Company and Executive mutually may agree upon from time to time.
Executive’s employment shall also be subject to the policies maintained and established by the Company that are of general applicability to the Company’s executives, as such policies may be amended from time to time. Executive agrees,
during the period of Executive’s employment by the Company, to devote substantially all of Executive’s business time, energy and best efforts to the business and affairs of the Company and any other entity controlled by, or under common
control with, the Company (each, an “Affiliate”). 
 (b) Executive will comply with all applicable laws and
corporate documents and policies governing the conduct of the business and affairs of the Company and its Affiliates. 
 3.
Term. Subject to the provision for earlier termination set forth in Section 5 hereof, this Agreement shall be for an initial term that begins on the Effective Date and continues in effect through the third anniversary of
the Effective Date and, unless terminated sooner as herein provided, shall automatically be extended for one additional year on each anniversary of the Effective Date (the “Term”). 

 4. Compensation. 

(a) Salary. During the Term, Executive shall receive an annualized base salary of $465,000.00, subject to adjustment up (but not down)
by the Board of Directors of Parent (the “Board”) (the “Base Salary”) payable in accordance with the Company’s normal payroll practices. 

(b) Bonus. During the Term, Executive shall be eligible to participate in Parent’s annual bonus arrangement as in effect from time
to time. The amount of such bonus shall be based on the performance of the Company, Parent and their Affiliates and/or Executive, with specific performance targets and amounts to be determined annually by the Board or the Compensation Committee of
the Board. The parties expect that the annual performance goals applicable to Executive shall be based primarily on the performance of the Company and/or Executive. 

(c) Employee Benefits. During the Term, Executive shall be entitled to participate in all benefit plans generally available to the
Company’s other employees when and as such plans, if any, become available and Executive becomes eligible for them. 
 (d) Incentive
Plans. During the Term, Executive shall be entitled to participate in the Company’s and/or Parent’s incentive plans, as in effect from time to time. 

(e) Reimbursement of Expenses. The Company agrees to promptly reimburse Executive for all appropriately documented, reasonable travel
and other business expenses incurred by Executive in the course of providing services requested by the Company or otherwise incurred in his capacity as Executive. 

5. Termination of Employment. 

(a) By the Company. Notwithstanding the provisions of Section 3, the Company may terminate Executive’s employment under this
Agreement at any time for Cause (as defined below), or for any other reason whatsoever or for no reason at all, in the sole discretion of the Company. The Company may terminate Executive’s employment under this Agreement at any time for Cause,
by delivering to Executive written notice describing the cause of termination (x) in the case of clause (i), 30 days before the effective date of such termination and by granting Executive at least 20 days to cure the cause; (y) in the
case of clauses (ii), (iii) or (iv), 10 days before the effective date of such termination and by granting Executive at least 10 days to cure the cause; or (z) in the case of clause (v) on the date of such termination; provided however,
that if the matter is reasonably determined by the Company to not be capable of being cured, Executive may be terminated for cause on the date the written notice is delivered. 

“Cause” shall be limited to the occurrence of the following events: 

 

	 	(i)	Executive’s failure to perform the duties described in Section 2 in an honest and faithful manner; 

  

	 	(ii)	Executive’s omission to perform his duties in a manner that materially and adversely affects the Company; 

  

	 	(iii)	Executive’s taking of any action in violation of any material policies of the Company that could be reasonably expected to damage or negatively impact the business, operations, reputation or financial condition of
the Company in a material manner; 

  
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	 	(iv)	any other action taken by Executive in bad faith or that could be reasonably expected to damage or negatively impact the business, operations, reputation or financial condition of the Company in a material manner; or

  

	 	(v)	Executive’s conviction of (or plead of no contest to) a crime involving fraud, dishonesty or moral turpitude or any felony. 

(b) By Executive. Notwithstanding the provisions of Section 3, Executive may terminate Executive’s employment under this
Agreement for Good Reason or for any reason whatsoever or no reason at all, in the sole discretion of Executive. In such case, Executive must deliver to the Company written notice of such termination at least 30 days before the effective date of
such termination, unless otherwise provided in this Agreement. 
 “Good Reason” means:  
 (1) if, prior to a Change in Control, the occurrence of any of the following events:

  

	 	(i)	a material diminution in Executive’s Base Salary; 

  

	 	(ii)	a material diminution in Executive’s authority, duties or responsibilities; or 

  

	 	(iii)	a material breach by the Company of a material provision of this Agreement. 

Notwithstanding the foregoing provisions of this clause (1) or any other provision in this Agreement to the contrary, any
assertion by Executive of a termination of employment for “Good Reason” pursuant to this clause (1) shall not be effective unless all of the following conditions are satisfied: (A) the condition described in clauses (i), (ii) or
(iii) giving rise to Executive’s termination of employment must have arisen without Executive’s consent; (B) Executive must provide written notice to the Company of such condition in accordance with Section 11 within 45 days
of Executive gaining knowledge of the initial existence of the condition, (C) the condition specified in such notice must remain uncorrected for 30 days after receipt of such notice by the Company and (D) the date of Executive’s
termination of employment must occur within 30 days after the expiration of the cure period set forth in (C) above. The date of actual termination of employment in accordance with this clause (1) shall be the “date of
termination.” 
 (2) if, on or after a Change in Control, the Company, without the consent of Executive: 

 

	 	(i)	causes Executive to cease to be the President of the Company or the primary onshore contract drilling operating subsidiary of the ultimate parent of the Company; 

 

	 	(ii)	assigns to Executive any duties inconsistent with Executive’s position as the President of the Company or the primary onshore contract drilling operating subsidiary of the ultimate parent of the Company (including
offices, titles and reporting requirements), authority, duties, status or responsibilities with the Company in effect immediately before the occurrence of the first Change in Control or otherwise makes any change in any such position, authority,
duties or responsibilities; 

  

	 	(iii)	 removes Executive from, or fails to re-elect or appoint Executive to, any
duties or position with the Company or any of its Affiliates that were assigned or held by 

  
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Executive immediately before the occurrence of the first Change in Control, except that a nominal change in Executive’s title that is merely descriptive and does not affect rank or status
shall not constitute such an event; 

  

	 	(iv)	takes any other action that results in a material diminution in such position, authority, duties or responsibilities or otherwise take any action that materially interferes therewith; 

 

	 	(v)	reduces Executive’s Base Salary as in effect immediately before the occurrence of the first Change in Control or as Executive’s Base Salary may be increased from time to time after that occurrence;

  

	 	(vi)	reduces Executive’s annual bonus to an amount less than the average of the two annual bonuses earned by Executive with respect to the two fiscal years of the Company immediately preceding the fiscal year of the
Company in which the first Change in Control occurred; 

  

	 	(vii)	relocates Executive’s principal place of employment to a location outside of a 50-mile radius from Executive’s principal place of employment immediately prior to the
first Change in Control; 

  

	 	(viii)	fails to (x) continue in effect any bonus, incentive, profit sharing, performance, savings, retirement or pension policy, plan, program or arrangement (such policies, plans, programs and arrangements collectively
being referred to herein as “Basic Benefit Plans”), including, but not limited to, any deferred compensation, supplemental executive retirement or other retirement income, stock option, stock purchase, stock appreciation, or
similar policy, plan, program or arrangement of the Company or its Affiliates, in which Executive was a participant immediately before the occurrence of the first Change in Control, or any substitute plan adopted by the Board and in which Executive
was a participant immediately before the occurrence of the last Change in Control, unless an equitable and reasonably comparable arrangement (embodied in a substitute or alternative benefit or plan) shall have been made with respect to such Basic
Benefit Plan promptly following the occurrence of the last Change in Control, or (y) continue Executive’s participation in any Basic Benefit Plan (or any substitute or alternative plan) on substantially the same basis, both in terms of the
amount of benefits provided to Executive (which are in any event always subject to the terms of any applicable Basic Benefit Plan) and the level of Executive’s participation relative to other participants, as existed immediately before the
occurrence of the first Change in Control; 

  

	 	(ix)	fails to continue to provide Executive with benefits substantially similar to those enjoyed by Executive under any of the Company’s other employee benefit plans, policies, programs and arrangements, including, but
not limited to, life insurance, medical, dental, health, hospital, accident or disability plans, in which Executive was a participant immediately before the occurrence of the first Change in Control; 

 

	 	(x)	fails to provide Executive with the number of paid vacation days to which Executive was entitled in accordance with the Company’s vacation policy in effect immediately before the occurrence of the first Change in
Control; 

  
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	 	(xi)	fails to continue to provide Executive with office space, related facilities and support personnel (including, but not limited to, administrative and secretarial assistance) (y) that are both commensurate with
Executive’s responsibilities to and position with the Company immediately before the occurrence of the first Change in Control and not materially dissimilar to the office space, related facilities and support personnel provided to other
employees of the Company having comparable responsibility to Executive, or (z) that are physically located at the Company’s principal executive offices; or 

 

	 	(xii)	purports to terminate Executive’s employment by the Company unless notice of that termination shall have been given to Executive pursuant to, and that notice shall meet the requirements of, this Section 5.

 If Executive’s employment by the Company is terminated by Executive as a result of the occurrence of Good Reason,
Executive shall provide the Company a notice that shall specifically describe the action or inaction of the Company that Executive believes constitutes Good Reason. The notice given pursuant to this clause (2) shall state a date, which shall be
not fewer than 30 days nor more than 60 days after the date such notice is given, on which the termination of Executive’s employment by the Company is effective. The date so stated in accordance with this clause (2) shall be the “date
of termination.” 
 (c) Death or Disability. Executive’s employment under this Agreement shall terminate automatically upon
Executive’s death or Disability. For purposes of this Agreement, Executive shall be deemed to be terminated due to “Disability” if Executive shall be considered to be permanently and totally disabled in accordance with
the Company’s disability plan, if any, for a period of 90 days or more. The Company may terminate Executive’s employment due to Disability by delivering to Executive written notice providing an effective date of termination no earlier than
the date of the notice of termination. If there should be a dispute between the Company and Executive as to Executive’s Disability for purposes of this Agreement, the question shall be settled by the opinion of an impartial reputable physician
agreed upon by the parties or their representatives within 30 days after the date of the notice of termination due to Disability. The parties agree to be bound by the final decision of such physician. 

6. Effect of Termination of Employment on Compensation. 

(a) Benefit Obligation and Accrued Obligation Defined. For purposes of this Agreement, payment of the “Benefit
Obligation” shall mean payment by the Company to Executive (or his designated beneficiary or legal representative, as applicable), in accordance with the terms of the applicable plan document, of all vested benefits to which Executive
is entitled under the terms of the employee benefit plans and compensation arrangements in which Executive is a participant as of the date of termination. “Accrued Obligation” means the sum of (1) Executive’s Base
Salary through the date of termination, (2) any accrued vacation pay earned by Executive, (3) any earned but unpaid annual bonus for any completed calendar year and (4) any incurred but unreimbursed expenses for which Executive is
entitled to reimbursement, in each case, to the extent not theretofore paid. 
 (b) By the Company Without Cause or by Executive for Good
Reason. If during the Term, but prior to the occurrence of a Change in Control (as defined in Section 7) Executive’s employment is terminated by the Company other than for Cause and not as a result of Executive’s death or
Disability, or Executive’s employment is terminated by Executive for Good Reason, then Executive shall receive the following benefits and compensation from the Company: 
  

	 	(i)	the Company shall pay Executive the Accrued Obligation within 30 days following the date of Executive’s date of termination or such earlier date as may be required by law; 

  
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	 	(ii)	the Company shall pay Executive a lump-sum payment consisting of 2.5 times the sum of Executive’s Base Salary plus the average annual cash bonus received by Executive for the
three years prior to the date of termination, payable on the 60th day following Executive’s date of termination; 

  

	 	(iii)	the Company shall pay Executive a lump-sum payment equal to Executive’s annual cash bonus based on actual results for the year in which Executive’s date of termination
occurs multiplied by a fraction, the numerator of which is the number of days Executive was employed by the Company during the year of the termination and the denominator of which is 365, payable at the same time as annual cash bonuses are paid to
active employees; 

  

	 	(iv)	Parent will cause all unvested options and restricted stock awards, previously granted by Parent to Executive, to vest on the 60th day following Executive’s date of termination; 

 

	 	(v)	Executive shall be entitled to receive a number of shares of Parent common stock in an amount equal to the amount of any performance units, previously granted to Executive, that would have vested at the end of the
applicable performance period based on actual results, payable at the same time as if Executive had remained employed through the end of the applicable performance period; and 

 

	 	(vi)	the Company shall pay Executive the Benefit Obligation at the times specified in and in accordance with the terms of the applicable employee benefit plans and compensation arrangements. 

Notwithstanding the foregoing, neither Executive, nor his estate, shall be permitted to specify the taxable year in which a payment described
in this Section 6(b) shall be paid. 
 (c) By the Company for Cause. If during the Term Executive’s employment is terminated by
the Company for Cause, the Company shall pay to Executive the Accrued Obligation within 30 days following the date of termination or such earlier date as may be required by law. The Company shall pay Executive (or his designated beneficiary or legal
representative, if applicable) the Benefit Obligation at the times specified in and in accordance with the terms of the applicable employee benefit plans and compensation arrangements. Following such payments, the Company shall have no further
obligations to Executive other than as may be required by law. For the avoidance of doubt, all unvested stock options, restricted stock awards, performance units or other equity awards, previously granted to Executive, shall be forfeited for no
consideration, as of the date of termination. 
 (d) By Executive without Good Reason. If during the Term and prior to a Change in
Control (as defined below), Executive terminates his employment without Good Reason, the Company shall pay to Executive the Accrued Obligation within 30 days following the date of termination or such earlier date as may be required by law. The
Company shall pay Executive (or his designated beneficiary or legal representative, if applicable) the Benefit Obligation at the times specified in and in accordance with the terms of the applicable employee benefit plans and compensation
arrangements. Following such payments, the Company shall have no further obligations to Executive other than as may be required by law. For the avoidance of doubt, all unvested stock options, restricted stock awards, performance units or

  
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other equity awards, previously granted to Executive, shall be forfeited for no consideration, as of the date of termination. Any vested stock options shall be exercisable in accordance with the
terms and conditions set forth in the applicable award agreement or plan document. The Company shall pay Executive the Benefit Obligation at the times specified in and in accordance with the terms of the applicable employee benefit plans and
compensation arrangements. Executive shall not have breached this Agreement if he terminates his employment without Good Reason. 
 (e)
Disability; Death. If during the Term, Executive’s employment is terminated by the Company due to the death or Disability of Executive, then the Company shall pay Executive (or
his designated beneficiary or legal representative, if applicable) the Accrued Obligation within 30 days following the date of Executive’s date of termination or such earlier date as may be required by law. The Company shall pay Executive (or
his designated beneficiary or legal representative, if applicable) the Benefit Obligation at the times specified in and in accordance with the terms of the applicable employee benefit plans and compensation arrangements. All stock options,
restricted stock awards, performance units or other equity awards, previously granted to Executive, shall be administered in accordance with the terms of the applicable award agreement and plan document. Notwithstanding the foregoing, neither
Executive, nor his estate, shall be permitted to specify the taxable year in which a payment described in this Section 6(e) shall be paid. 

(f) General Release of Claims. Payments to and benefits for Executive under this Section 6 or Section 7 (other than Accrued
Obligation and Benefit Obligation) are contingent upon Executive’s execution of a release, substantially in the form attached hereto as Exhibit A, within 50 days of Executive’s date of termination that is not revoked by Executive during
any applicable revocation period provided in such release (which shall release and discharge the Company and its Affiliates, and their officers, directors, managers, employees and agents from any and all claims or causes of action of any kind or
character, including but not limited to all claims or causes of action arising out of Executive’s employment with the Company or its Affiliates or the termination of such employment). 

7. Change in Control.  

(a) If during the Term a Change in Control occurs and Executive’s employment is terminated by the Company other than for Cause and not as
a result of Executive’s death or Disability, or is terminated by Executive for Good Reason then, Executive shall receive the following benefits and compensation from the Company: 

 

	 	(i)	the Company shall pay Executive the Accrued Obligation within 30 days following the date of Executive’s date of termination; 

  

	 	(ii)	the Company shall pay Executive a lump-sum payment consisting of 2.5 times the sum of Executive’s Base Salary plus the average annual cash bonus received by Executive in the
three years prior to the date of termination, payable on the 60th day following Executive’s date of termination; 

  

	 	(iii)	the Company shall pay Executive a pro-rated annual bonus for the year during which Executive’s date of termination occurs as a
lump-sum payment in an amount equal to the highest annual bonus received by Executive in the three years prior to the date of termination multiplied by a fraction, the numerator of which is the number of days
Executive was employed by the Company during the year of the termination and the denominator of which is 365, payable on the 60th day following Executive’s date of termination; 

  
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	 	(iv)	during the thirty-month period following Executive’s date of termination, the Company shall allow Executive and his eligible dependents to continue to be covered by all medical, vision and dental benefit plans
maintained by the Company under which Executive was covered immediately prior to Executive’s date of termination at the same active employee premium cost as a similarly situated active employee, provided that such reimbursements shall not be
made in the event the Company would be subject to any excise tax under Section 4980D of the Internal Revenue Code of 1986, as amended (the “Code”) or other penalty or liability pursuant to the provisions of the Patient Protection
and Affordable Care Act of 2010 (as amended from time to time), and in lieu of providing the subsidized premiums described above, the Company shall instead pay to Executive a fully taxable monthly cash payment in an amount such that, after payment
by Executive of all taxes on such payment, Executive retains an amount equal to the applicable premiums for such month, with such monthly payment being made on the last day of each month for the remainder of such thirty-month period; provided,
further, that such benefits provided during the thirty-month period shall run concurrent with the health continuation coverage period mandated by Section 4980B of the Code; 

 

	 	(v)	Parent will cause all unvested options and restricted stock awards, previously granted by Parent to Executive, to vest on the 60th day following Executive’s date of termination; 

 

	 	(vi)	Executive shall be entitled to receive a number of shares of Parent common stock in an amount equal to the target amount of any performance units, previously granted to Executive, on the 60th day following
Executive’s date of termination; and 

  

	 	(vii)	the Company shall pay Executive the Benefit Obligation at the times specified in and in accordance with the terms of the applicable employee benefit plans and compensation arrangements. 

Notwithstanding the foregoing, neither Executive, nor his estate, shall be permitted to specify the taxable year in which a payment described
in this Section 7(a) shall be paid. 
 (b) For purposes of this Agreement, a “Change in Control” shall mean the
occurrence a Change in Control of the Company or a Change in Control of Parent. 
 (c) For purposes of this Agreement, a “Change
in Control of the Company” shall mean the occurrence of any of the following after the Effective Date: 
  

	 	(i)	Except as contemplated by clause (ii), Parent or its successor resulting from a reorganization, merger, consolidation or disposition of all or substantially all of the assets of Parent
(“Successor”) ceasing to own, directly or indirectly, more than 50% of the combined voting power of the then outstanding voting securities of the Company; or 

 

	 	(ii)	 Consummation of (xx) a reorganization, merger, consolidation, sale or other disposition of the Company or
(yy) a disposition of all or substantially all of the assets of the Company (a “Company Transaction”), in each case, unless, immediately following such Company Transaction, (A) Parent or its Successor

  
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beneficially owns, directly or indirectly, more than 50% of the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors or other
governing body, as the case may be, of the entity resulting from such Company Transaction (including, without limitation, an entity which as a result of such transaction owns the Company or all or substantially all of the Company’s assets
either directly or through one or more subsidiaries) (the “Company Voting Securities”) or (B) the stockholders of Parent or its Successor immediately prior to the Company Transaction hold the then outstanding Company
Voting Securities held by Parent or such Successor immediately prior to the Company Transaction. 

 (d) For purposes of this
Agreement, a “Change in Control of Parent” shall mean the occurrence of any of the following after the Effective Date: 
  

	 	(i)	The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Covered Person”) of beneficial ownership (within the meaning of
rule 13d-3 promulgated under the Exchange Act) of 35% or more of either (i) the then outstanding shares of the common stock of Parent (the “Outstanding Parent Common Stock”), or
(ii) the combined voting power of the then outstanding voting securities of Parent entitled to vote generally in the election of directors (the “Outstanding Parent Voting Securities”); provided, however, that for
purposes of this subsection (i) of this Section 7(d), the following acquisitions shall not constitute a Change in Control of Parent: (i) any acquisition directly from Parent, (ii) any acquisition by Parent, (iii) any acquisition
by any employee benefit plan (or related trust) sponsored or maintained by Parent or any entity controlled by Parent, or (iv) any acquisition by any corporation pursuant to a transaction which complies with clauses (A), (B) and (C) of
subsection (iii) of this Section 7(d); or 

  

	 	(ii)	Individuals who, as of the Effective Date, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual
becoming a director subsequent to the Effective Date whose election, or nomination for election by Parent’s stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as
though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or
removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Covered Person other than the Board; or 

  

	 	(iii)	 Consummation of (xx) a reorganization, merger or consolidation or sale of Parent or any subsidiary of
Parent, or (yy) a disposition of all or substantially all of the assets of Parent (a “Business Combination”), in each case, unless, following such Business Combination, (A) all or substantially all of the individuals and
entities who were the beneficial owners, respectively, of the Outstanding Parent Common Stock and Outstanding Parent Voting Securities immediately prior to such Business Combination beneficially own, direct or indirectly, more than 65% of,
respectively, the then outstanding shares of common stock and the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from

  
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such Business Combination (including, without limitation, a corporation which as a result of such transaction owns Parent or all or substantially all of Parent’s assets either directly or
through one or more subsidiaries) in substantially the same proportions as their ownership immediately prior to such Business Combination of the Outstanding Parent Common Stock and Outstanding Parent Voting Securities, as the case may be,
(B) no Covered Person (excluding any employee benefit plan (or related trust) of Parent or such corporation resulting from such Business Combination) beneficially owns, directly or indirectly, 35% or more of, respectively, the then outstanding
shares of common stock of the corporation resulting from such Business Combination or the combined voting power of the then outstanding voting securities of such corporation, except to the extent that such ownership existed prior to the Business
Combination, and (C) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement, or, if
earlier, of the action of the Board, providing for such Business Combination. 

 8. Proprietary Information.

 (a) Confidential Treatment. Executive acknowledges and agrees that he has acquired, and will in the future acquire as a result of
his employment by the Company or otherwise, Proprietary Information (as defined below) of the Company which is of a confidential or trade secret nature, and all of which has a great value to the Company and is a substantial basis and foundation upon
which the Company’s business is predicated. Accordingly, other than in the legitimate performance of his job duties, Executive agrees: 
  

	 	(i)	to regard and preserve as confidential at all times all Proprietary Information, 

  

	 	(ii)	to refrain from publishing or disclosing any part of the Proprietary Information and from using, copying or duplicating it in any way by any means whatsoever, and 

 

	 	(iii)	not to use on his own behalf or on behalf of any third party or to disclose the Proprietary Information to any person or entity without the prior written consent of the Company. 

“Proprietary Information” includes all confidential or proprietary scientific or technical information, data, formulas and related
concepts, business plans (both current and under development), client lists, promotion and marketing programs, trade secrets, or any other confidential or proprietary business information relating to drilling, pressure pumping, or extraction
processes, development programs, costs, revenues, marketing, investments, sales activities, promotions, credit and financial data, financing methods, plans or the business of the Company or its Affiliates, whether in written or electronic form of
writings, correspondence, notes, drafts, records, maps, invoices, technical and business logs, maps, policies, computer programs, disks or otherwise. Proprietary Information does not include information that is or becomes publicly known through
lawful means. 
 (b) Property of the Company. Upon the termination of Executive’s employment with the Company, Executive shall
surrender to the Company any and all work papers, reports, manuals, documents and the like (including all originals and copies thereof) in his possession which contain Proprietary Information relating to the business, prospects or plans of the
Company or its Affiliates. Further, Executives agrees to delete all Proprietary Information from his computer, smartphone, tablet, or 

  
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any other personal electronic storage devices that may contain Proprietary Information. Executive acknowledges that all Proprietary Information and other property of the Company or any Affiliate
thereof which Executive accumulates during his engagement are the property of the Company and shall be returned to the Company immediately upon termination of this Agreement. 

(c) Cooperation. Executive agrees that following any termination of his employment with the Company, he will not disclose or cause to
be disclosed any Proprietary Information, or any negative or adverse information of a substantial nature about the Company or its Affiliates, the management of the Company or its Affiliates, any product or service provided by the Company or its
Affiliates or the future prospects of the Company or its Affiliates unless required by court order. Nothing in this Section 8 prohibits Executive from reporting possible violations of law or regulation to any governmental agency or entity (or
of making any other protected disclosures). Pursuant to the Defend Trade Secrets Act of 2016, Executive shall not be held criminally or civilly liable under any Federal or state trade secret law for the disclosure of any Proprietary Information that
(i) is made (A) in confidence to a Federal, state or local government official, either directly or indirectly, or to an attorney and (B) solely for the purpose of reporting or investigating a suspected violation of law or (ii) is
made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. The Company may seek the assistance, cooperation or testimony of Executive following any such termination in connection with any
investigation, litigation or proceeding arising out of matters within the knowledge of Executive and related to his engagement by the Company, and in any instance, Executive shall provide such assistance, cooperation or testimony and the Company
shall pay Executive’s reasonable costs and expenses in connection therewith. 
 9. Restrictive Covenants. 

(a) Definitions. As used in this Section 9, the following terms shall have the following meanings: 

 

	 	(i)	“Business” means the onshore contract drilling business in which the Company, including its Affiliates, is engaged in during the Prohibited Period. 

 

	 	(ii)	“Competing Business” means any business, individual, partnership, firm, corporation or other entity which wholly or in any significant part engages in any business competing with the Business in
the Restricted Area. 

  

	 	(iii)	“Governmental Authority” means any governmental, quasi-governmental, state, county, city or other political subdivision of the United States or any other country, or any agency, court or
instrumentality, foreign or domestic, or statutory or regulatory body thereof. 

  

	 	(iv)	“Legal Requirement” means any law, statute, code, ordinance, order, rule, regulation, judgment, decree, injunction, franchise, permit, certificate, license, authorization, or other directional
requirement of any Governmental Authority. 

  

	 	(v)	“Prohibited Period” means the period during which Executive is employed by the Company hereunder and a period of one year following Executive’s date of termination. 

 

	 	(vi)	“Restricted Area” (A) means any country or subdivision thereof in which the Company or its Affiliates (i) is then currently engaged in the Business, (ii) has engaged in
the Business in the two years prior to Executive’s date of termination or (iii) is actively pursuing business opportunities for the Business and (B) includes the parishes in Louisiana listed on Exhibit B.  

  
 11 

 (b) Non-Competition;
Non-Solicitation. 
  

	 	(i)	Executive and the Company agree to the non-competition and non-solicitation provisions of this Section 9(b); (i) in consideration for the
Proprietary Information provided by the Company to Executive pursuant to Section 8 of this Agreement; (ii) as part of the consideration for the compensation and benefits to be paid to Executive hereunder; (iii) to protect the
Proprietary Information of the Company or its Affiliates disclosed or entrusted to Executive by the Company or its Affiliates or created or developed by Executive for the Company or its Affiliates, the business goodwill of the Company or its
Affiliates developed through the efforts of Executive and/or the business opportunities disclosed or entrusted to Executive by the Company or its Affiliates; and (iv) as an additional incentive for the Company to enter into this Agreement.

  

	 	(ii)	Subject to the exceptions set forth in Section 9(b)(iii) below, Executive expressly covenants and agrees that during the Prohibited Period (i) Executive will refrain from carrying on or engaging in, directly or
indirectly, any Competing Business in the Restricted Area and (ii) Executive will not, and Executive will cause Executive’s Affiliates not to, directly or indirectly, own, manage, operate, join, become an employee, partner, owner or member
of (or an independent contractor to), control or participate in or loan money to, sell or lease equipment to or sell or lease real property to any business, individual, partnership, firm, corporation or other entity which engages in a Competing
Business in the Restricted Area. 

  

	 	(iii)	Notwithstanding the restrictions contained in Section 9(b)(ii), Executive or any of Executive’s affiliates may own an aggregate of not more than 1% of the outstanding stock of any class of any corporation engaged
in a Competing Business, if such stock is listed on a national securities exchange or regularly traded in the over-the-counter market by a member of a national
securities exchange, without violating the provisions of Section 9(b)(ii), provided that neither Executive nor any of Executive’s affiliates has the power, directly or indirectly, to control or direct the management or affairs of any such
corporation and is not involved in the management of such corporation. 

  

	 	(iv)	Executive further expressly covenants and agrees that during the Prohibited Period, Executive will not, and Executive will cause Executive’s affiliates not to (i) engage or employ, or solicit or contact with a
view to the engagement or employment of, any person who is an officer or employee of the Company or any of its Affiliates or (ii) canvass, solicit, approach or entice away or cause to be canvassed, solicited, approached or enticed away from the
Company or any of its Affiliates any person who or which is a customer of any of such entities during the period during which Executive is employed by the Company. 

 

	 	(v)	Executive expressly recognizes that Executive is a high-level, executive employee who will be provided with access to Proprietary Information and trade secrets as part of Executive’s employment and that the
restrictive covenants set forth in this Section 9 are reasonable and necessary in light of Executive’s executive position and access to the Proprietary Information. 

  
 12 

 (c) Non-Disparagement. Executive agrees that
following any termination of his employment with the Company, he will not disparage, orally or in writing, the Company or its Affiliates, the management of the Company or its Affiliates, any product or service provided by the Company or its
Affiliates or the future prospects of the Company or its Affiliates. 
 (d) Relief. Executive and the Company agree and acknowledge
that the limitations as to time, geographical area and scope of activity to be restrained as set forth in this Section 9 are reasonable and do not impose any greater restraint than is necessary to protect the legitimate business interests of
the Company. Executive and the Company also acknowledge that money damages would not be sufficient remedy for any breach of Section 8 or this Section 9 by Executive, and the Company or its Affiliates shall be entitled to enforce the
provisions of Section 8 or this Section 9 by terminating payments then owing to Executive under this Agreement or otherwise and to specific performance and injunctive relief as remedies for such breach or any threatened breach. Such
remedies shall not be deemed the exclusive remedies for a breach of Section 8 or this Section 9 but shall be in addition to all remedies available at law or in equity, including the recovery of damages from Executive and Executive’s
agents. However, if it is determined that Executive has not committed a breach of Section 8 or this Section 9, then the Company shall resume the payments and benefits due under this Agreement and pay to Executive all payments and benefits
that had been suspended pending such determination. 
 (e) Reasonableness; Enforcement. Executive acknowledges that the geographic
scope and duration of the covenants contained in this Section 9 are the result of arm’s-length bargaining and are fair and reasonable in light of (a) the nature and wide geographic scope of the
operations of the Business, (b) Executive’s level of control over and contact with the Business in all jurisdictions in which it is conducted, (c) the fact that the Business is conducted throughout the Restricted Area and (d) the
amount of compensation and Proprietary Information that Executive is receiving in connection with the performance of Executive’s duties hereunder. It is the desire and intent of the parties that the provisions of this Section 9 be enforced
to the fullest extent permitted under applicable Legal Requirements, whether now or hereafter in effect and therefore, to the extent permitted by applicable Legal Requirements, Executive and the Company hereby waive any provision of applicable Legal
Requirements that would render any provision of this Section 9 invalid or unenforceable. 
 (f) Reformation. The Company and
Executive agree that the foregoing restrictions are reasonable under the circumstances and that any breach of the covenants contained in this Section 9 would cause irreparable injury to the Company. Executive expressly represents that
enforcement of the restrictive covenants set forth in this Section 9 will not impose an undue hardship upon Executive or any person or entity affiliated with Executive. Executive understands that the foregoing restrictions may limit
Executive’s ability to engage in certain businesses anywhere in the Restricted Area during the Prohibited Period, but acknowledges that Executive will receive sufficiently high remuneration and other benefits from the Company to justify such
restriction. Further, Executive acknowledges that Executive’s skills are such that Executive can be gainfully employed in non-competitive employment, and that the restrictive covenants will not prevent
Executive from earning a living. Nevertheless, if any of the aforesaid restrictions are found by a court of competent jurisdiction to be unreasonable, or overly broad as to geographic area or time, or otherwise unenforceable, the parties intend for
the restrictions herein set forth to be modified by the court making such determination so as to be reasonable and enforceable and, as so modified, to be fully enforced. 

10. Excise Taxes. Notwithstanding anything to the contrary in this Agreement, if Executive is a “disqualified
individual” (as defined in Section 280G(c) of the Code), and the payments and benefits provided for under this Agreement, together with any other payments and benefits which Executive has the right to receive from the Company or any of its
Affiliates, would constitute a “parachute payment” (as defined in Section 280G(b)(2) of the Code), then the payments and benefits provided for under this 

  
 13 

 
Agreement shall be either (a) reduced (but not below zero) so that the present value of such total amounts and benefits received by Executive from the Company and its Affiliates will be one
dollar ($1.00) less than three times Executive’s “base amount” (as defined in Section 280G(b)(3) of the Code) and so that no portion of such amounts and benefits received by Executive shall be subject to the excise tax imposed by
Section 4999 of the Code or (b) paid in full, whichever produces the better net after-tax position to Executive (taking into account any applicable excise tax under Section 4999 of the Code and
any other applicable taxes). The reduction of payments and benefits hereunder, if applicable, shall be made by reducing, first, payments or benefits to be paid in cash hereunder in the order in which such payment or benefit would be paid or provided
(beginning with such payment or benefit that would be made last in time and continuing, to the extent necessary, through to such payment or benefit that would be made first in time) and, then, reducing any benefit to be provided in kind hereunder in
a similar order. The determination as to whether any such reduction in the amount of the payments and benefits provided hereunder is necessary shall be made by a nationally recognized public accounting firm selected by the Company in good faith and
approved by Executive, which approval shall not be unreasonably withheld. If a reduced payment or benefit is made or provided and through error or otherwise that payment or benefit, when aggregated with other payments and benefits from the Company
(or its Affiliates) used in determining if a parachute payment exists, exceeds one dollar ($1.00) less than three times Executive’s base amount, then Executive shall immediately repay such excess to the Company upon notification that an
overpayment has been made. 
 11. Notice. All notices, requests, consents, directions and other instruments and communications
required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been duly given if (a) delivered personally, (b) mailed first-class, postage prepaid, registered or certified mail, or (c) sent by
overnight courier, facsimile, telecommunication or other similar form of communication (with receipt confirmed), as follows: 
  

			
	To the Company:	  	Patterson-UTI Drilling Company LLC
		  	Attention: General Counsel
		  	10713 West Sam Houston Parkway N., Suite 800
		  	Houston, Texas 77064
		  	Facsimile: (281) 765-7175
		
	To Executive:	  	James M. Holcomb at the most recent address for Executive
		  	listed in the payroll records of the Company.

 or to such other address and to the attention of such other person(s) or officer(s) as any party may designate by written
notice. Any notice mailed shall be deemed to have been given and received on the third business day following the day of mailing. Any notice sent by overnight courier, facsimile, telecommunication or other similar form of communication (with receipt
confirmed) shall be deemed to have been given and received on the next business day following the day such communication is sent. 
 12.
References to the Company. References in this Agreement to the Company in the context of providing services to the Company shall include the Company and all of its Affiliates as the context reasonably requires, including without
limitation Sections 8 and 9. To the extent Executive’s employment is transferred to an Affiliate, references in this Agreement to employment with the Company shall also refer to employment with the employing Affiliate as the context
reasonably requires. 
 13. Nonassignment. This Agreement is personal to Executive and to the Company and shall not be
assigned by either party without the other’s written consent, except that the Company may assign its rights and delegate its obligations under this Agreement to any entity that acquires all or substantially all of its business. 

  
 14 

 14. Further Assurances. Each party hereto agrees to perform such further actions,
and to execute and deliver such additional documents, as may be reasonably necessary to carry out the provisions of this Agreement. 
 15.
Severability. In the event that any of the provisions, or portions thereof, of this Agreement are held to be unenforceable or invalid by any court of competent jurisdiction, the validity and enforceability or the remaining provisions,
or portions thereof, shall not be affected thereby. 
 16. Governing Law; Venue. This Agreement shall be governed and
construed under and interpreted in accordance with the laws of the State of Texas without giving effect to the doctrine of conflict of laws. With respect to any claim or dispute related to or arising under this Agreement, the parties hereto hereby
consent to the exclusive jurisdiction, forum and venue of the state and federal courts located in or sitting for Houston, Texas. 
 17.
Entire Agreement; Interpretation. This Agreement constitutes the entire agreement of the parties, and supersedes all prior agreements, oral or written, between the Company and
Executive relating to his employment by the Company, including the Employment Agreement between the Company and Executive dated January 1, 2012, as amended or otherwise modified from time to time, which as of the Effective Date shall be null
and void. For the avoidance of doubt, any equity incentive award agreements or indemnity agreements between the Company and Executive remain in effect in accordance with their terms and are not superseded pursuant to this Section 17, except to
the extent that this Agreement provides more favorable vesting provisions applicable to certain terminations of employment as described in Sections 6 and 7. No change or modification of this Agreement shall be enforceable unless contained in a
writing signed by the party against whom enforcement is sought. No presumption shall be construed against the party drafting this Agreement. 

18. Withholding of Taxes and Other Employee Deductions. The Company may withhold from any benefits and payments made pursuant to
this Agreement all federal, state, city and other applicable taxes and withholdings as may be required pursuant to any law or governmental regulation or ruling and all other customary deductions made with respect to the Company’s employees
generally. 
 19. Executive’s Representations. Executive represents and warrants that: 

(a) he is free to enter into this Agreement and to perform each of the terms and covenants contained herein; 

(b) he has been advised by legal counsel as to the terms and provisions hereof and the effort thereof and fully understands the consequences
thereof; 
 20. Waiver. The failure of any party to insist, in any one or more instances, upon strict performance of any one
or more of the provisions, terms and conditions of this Agreement, or to exercise any right or rights hereunder shall not be construed as a waiver thereof, and any and all such provisions, terms, conditions and rights shall continue and remain in
full force and effect. 
 21. Compliance with Section 409A. 

(a) This Agreement is intended to comply with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended
(“Section 409A”) and shall be construed and interpreted in accordance with such intent. To the extent any payment or benefit provided under this Agreement is subject to Section 409A, such benefit shall be provided in a manner
that complies with Section 409A, including any IRS guidance promulgated with respect to Section 409A; provided, however, in no event shall any action to comply with Section 409A reduce the aggregate amount payable to Executive hereunder unless
expressly agreed in writing by Executive. 

  
 15 

 (b) All reimbursements or provision of in-kind benefits
pursuant to this Agreement shall be made in accordance with Treasury Regulation § 1.409A-3(i)(1)(iv) such that the reimbursement or provision will be deemed payable at a specified time or on a fixed
schedule relative to a permissible payment event. Specifically, the amount reimbursed or in-kind benefits provided under this Agreement during Executive’s taxable year may not affect the amounts
reimbursed or provided in any other taxable year (except that total reimbursements may be limited by a lifetime maximum under a group health plan), the reimbursement of an eligible expense shall be made on or before the last day of Executive’s
taxable year following the taxable year in which the expense was incurred, and the right to reimbursement or provision of in-kind benefit is not subject to liquidation or exchange for another benefit. 

(c) To the extent required to comply with Section 409A (as determined by the Company), if Executive is a “specified employee,” as
determined by the Company, as of his date of termination, then all amounts due under this Agreement that constitute a “deferral of compensation” within the meaning of Section 409A, that are provided as a result of a “separation from
service” within the meaning of Section 409A, and that would otherwise be paid or provided during the first six months following Executive’s date of termination, shall be accumulated through and paid or provided on the first business
day that is more than six months after Executive’s date of termination (or, if Executive dies during such six month period, within 90 days after Executive’s death). Each payment under this Agreement, including each payment in a series of
installment payments, is intended to be a separate payment for purposes of Treas. Reg. § 1.409A-2(b). 

22. Clawback Policy. Notwithstanding any other provisions in this Agreement, any payments made pursuant to this Agreement shall
be subject to recovery or clawback by the Company under any applicable clawback policy adopted by the Company in accordance with SEC regulations or other applicable law, including the clawback policy of the Company adopted on March 9, 2010, as
amended or superseded from time to time, and Executive agrees to execute appropriate acknowledgements or other documentation as may be required pursuant to such policies from time to time. 

23. 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 will constitute one and the same Agreement. 
 [SIGNATURES ON FOLLOWING PAGE] 

  
 16 

 IN WITNESS WHEREOF, the parties have caused this Agreement to be entered into as of the date
first written above. 
  

			
	PATTERSON-UTI DRILLING COMPANY LLC
		
	By:	 	 /s/ William Andrew Hendricks, Jr.

		 	William Andrew Hendricks, Jr.
		 	Chief Executive Officer
	
	EXECUTIVE
	
	 /s/ James M. Holcomb

	James M. Holcomb

  
 17 

 Exhibit A 

FORM OF WAIVER AND RELEASE 

[The language in this Release may change based on legal developments and evolving best practices; this form is provided as an example of
what will be included in the final Release document.] 
 In consideration of, and as a condition precedent to, the severance payment
(the “Severance”) described in that certain Employment Agreement (the “Agreement”) effective as of January 1, 2017 between Patterson-UTI Drilling Company
LLC, a Texas limited liability company (the “Company”), and James M. Holcomb (“Executive”), which were offered to Executive in exchange for a general waiver and release of claims (this
“Waiver and Release”). Executive having acknowledged the above-stated consideration as full compensation for and on account of any and all injuries and damages which Executive has sustained or claimed, or may be entitled to
claim, Executive, for himself, and his heirs, executors, administrators, successors and assigns, does hereby release, forever discharge and promise not to sue the Company, its parents, subsidiaries, affiliates, successors and assigns, and their past
and present officers, directors, partners, employees, members, managers, shareholders, agents, attorneys, accountants, insurers, heirs, administrators, executors (collectively the “Released Parties”) from any and all claims,
liabilities, costs, expenses, judgments, attorney fees, actions, known and unknown, of every kind and nature whatsoever in law or equity, which Executive had, now has, or may have against the Released Parties relating in any way to Executive’s
employment with the Company or termination thereof prior to and including the date of execution of this Waiver and Release, including but not limited to, all claims for contract damages, tort damages, special, general, direct, punitive and
consequential damages, compensatory damages, loss of profits, attorney fees and any and all other damages of any kind or nature; all contracts, oral or written, between Executive and any of the Released Parties; any business enterprise or proposed
enterprise contemplated by any of the Released Parties, as well as anything done or not done prior to and including the date of execution of this Waiver and Release. Notwithstanding anything to the contrary contained in this Waiver and Release,
nothing in this Waiver and Release shall be construed to release the Company from any obligations set forth in the Agreement. 
 Executive
understands and agrees that this release and covenant not to sue shall apply to any and all claims or liabilities arising out of or relating to Executive’s employment with the Company and the termination of such employment, including, but not
limited to: claims of discrimination based on age, race, color, sex (including sexual harassment), religion, national origin, marital status, parental status, veteran status, union activities, disability or any other grounds under applicable
federal, state or local law prior to and including the date of execution of this Waiver and Release, including, but not limited to, claims arising under the Age Discrimination in Employment Act of 1967, the Americans with Disabilities Act, the
Family and Medical Leave Act, Title VII of the Civil Rights Act, the Civil Rights Act of 1991, 42 U.S.C. § 1981, the Genetic Information Non-Discrimination Act of 2008, the Employee Retirement Income
Security Act of 1974, the Consolidated Omnibus Budget Reconciliation Act of 1985, the Rehabilitation Act of 1973, the Equal Pay Act of 1963 (EPA), all as amended, as well as any claims prior to and including the date of execution of this Waiver and
Release, regarding wages; benefits; vacation; sick leave; business expense reimbursements; wrongful termination; breach of the covenant of good faith and fair dealing; intentional or negligent infliction of emotional distress; retaliation; outrage;
defamation; invasion of privacy; breach of contract; fraud or negligent misrepresentation; harassment; breach of duty; negligence; discrimination; claims under any employment, contract or tort laws; claims arising under any other federal law, state
law, municipal law, local law, or common law; any claims arising out of any employment contract, policy or procedure; and any other claims related to or arising out of his employment or the separation of his employment with the Company prior to and
including the date of execution of this Waiver and Release. 
 In addition, Executive agrees not to cause or encourage any legal proceeding
to be maintained or instituted against any of the Released Parties, save and except proceedings to enforce the terms of the Agreement or claims of Executive not released by and in this Waiver and Release. 

This release does not apply to any claims for unemployment compensation or any other claims or rights which, by law, cannot be waived,
including the right to file an administrative charge or participate in an administrative investigation or proceeding; provided, however that Executive disclaims and waives any right to share or participate in any monetary award resulting from the
prosecution of such charge or investigation or proceeding. 

  
 18 

 Executive expressly acknowledges that he is voluntarily, irrevocably and unconditionally
releasing and forever discharging the Company and its respective present and former parents, subsidiaries, divisions, affiliates, branches, insurers, agencies, and other offices from all rights or claims he has or may have against the Company
including, but not limited to, without limitation, all charges, claims of money, demands, rights, and causes of action arising under the Age Discrimination in Employment Act of 1967, as amended (“ADEA”), up to and including
the date Executive signs this Waiver and Release including, but not limited to, all claims of age discrimination in employment and all claims of retaliation in violation of ADEA. Executive further acknowledges that the consideration given for this
waiver of claims under the ADEA is in addition to anything of value to which he was already entitled in the absence of this waiver. Executive further acknowledges: (a) that he has been informed by this writing that he should consult with an
attorney prior to executing this Waiver and Release; (b) that he has carefully read and fully understands all of the provisions of this Waiver and Release; (c) he is, through this Waiver and Release, releasing the Company from any and all
claims he may have against it; (d) he understands and agrees that this waiver and release does not apply to any claims that may arise under the ADEA after the date he executes this Waiver and Release; (e) he has at least twenty-one (21) days within which to consider this Waiver and Release; and (f) he has seven (7) days following his execution of this Waiver and Release to revoke the Waiver and Release; and
(g) this Waiver and Release shall not be effective until the revocation period has expired and Executive has signed and has not revoked the Waiver and Release. 

Executive acknowledges and agrees that: (a) he has had reasonable and sufficient time to read and review this Waiver and Release and that
he has, in fact, read and reviewed this Waiver and Release; (b) that he has the right to consult with legal counsel regarding this Waiver and Release and is encouraged to consult with legal counsel with regard to this Waiver and Release;
(c) that he has had (or has had the opportunity to take) twenty-one (21) calendar days to discuss the Waiver and Release with a lawyer of his choice before signing it and, if he signs before the end
of that period, he does so of his own free will and with the full knowledge that he could have taken the full period; (d) that he is entering into this Waiver and Release freely and voluntarily and not as a result of any coercion, duress or
undue influence; (e) that he is not relying upon any oral representations made to him regarding the subject matter of this Waiver and Release; (f) that by this Waiver and Release he is receiving consideration in addition to that which he
was already entitled; and (g) that he has received all information he requires from the Company in order to make a knowing and voluntary release and waiver of all claims against the Company. 

Executive acknowledges and agrees that he has seven (7) days after the date he signs this Waiver and Release in which to rescind or
revoke this Waiver and Release by providing notice in writing to the Company. Executive further understands that the Waiver and Release will have no force and effect until the end of that seventh day (the “Waiver Effective
Date”). If Executive revokes the Waiver and Release, the Company will not be obligated to pay or provide Executive with the benefits described in this Waiver and Release, and this Waiver and Release shall be deemed null and void. 

 

	
	AGREED TO AND ACCEPTED this
	
	     day of             , 20    .
	
	  
 James M. Holcomb

  
 19 

 Exhibit B 

Allen 
 Beauregard 

Bienville 
 Bossier 

Caddo 
 Calcasieu 

Cameron 
 DeSoto 

Jackson 
 Jefferson Davis 

Lafayette 
 Lincoln 

Natchitoches 
 Rapides 

Red River 
 Sabine 

St. Landry 
 St. Mary 

Vermilion 
 Webster 

  
 20Exhibit 10.1

	
The Simsbury Bank & Trust Company, Inc.

	
Supplemental Executive Retirement Agreement

THE SIMSBURY BANK & TRUST COMPANY, INC.

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

This SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT (this "Agreement") is adopted this 18th day of January, 2017, by and between THE SIMSBURY BANK & TRUST COMPANY, INC. a state-chartered commercial bank located in Simsbury, Connecticut (the "Bank"), and RICHARD J. SUDOL (the "Executive").

The purpose of this Agreement is to provide specified benefits to the Executive, a member of a select group of management or highly compensated employees who contribute materially to the continued growth, development and future business success of the Bank.  This Agreement shall be unfunded for tax purposes and for purposes of Title I of the Employee Retirement Income Security Act of 1974 ("ERISA"), as amended from time to time.

Article 1

Definitions

Whenever used in this Agreement, the following words and phrases shall have the meanings specified:

	
1.1

	
"Accrual Balance" means the liability that should be accrued by the Bank, under Generally Accepted Accounting Principles ("GAAP"), for the Bank's obligation to the Executive under this Agreement, by applying Accounting Principles Board Opinion Number 12 as amended by Statement of Financial Accounting Standards Number 106 and the Discount Rate.  Any one of a variety of amortization methods may be used to determine the Accrual Balance.  However, once chosen, the method must be consistently applied.

	
1.2

	
"Beneficiary" means each designated person or entity, or the estate of the deceased Executive, entitled to any benefits upon the death of the Executive pursuant to Article 4.

	
1.3

	
"Beneficiary Designation Form" means the form established from time to time by the Plan Administrator that the Executive completes, signs and returns to the Plan Administrator to designate one or more Beneficiaries.

	
1.4

	
"Board" means the Board of Directors of the Bank as from time to time constituted.

	
1.5

	
"Change in Control" means a change in the ownership or effective control of the Bank, or in the ownership of a substantial portion of the assets of the Bank, as such change is defined in Code Section 409A and regulations thereunder.

	
1.6

	
"Code" means the Internal Revenue Code of 1986, as amended, and all regulations and guidance thereunder, including such regulations and guidance as may be promulgated after the Effective Date.

 

1

	
1.7

	
"Disability" means the Executive: (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months; or (ii) is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees or directors of the Bank.  Medical determination of Disability may be made by either the Social Security Administration or by the provider of disability insurance covering employees or directors of the Bank provided that the definition of "disability" applied under such insurance program complies with the requirements of the preceding sentence.  Upon the request of the Plan Administrator, the Executive must submit proof to the Plan Administrator of the Social Security Administration's or the provider's determination.

	
1.8

	
"Discount Rate" means the rate used by the Plan Administrator for determining the Accrual Balance.  The initial Discount Rate is five and one-half percent (5.5%).  However, the Plan Administrator, in its discretion, may adjust the Discount Rate to maintain the rate within reasonable standards according to GAAP and/or applicable bank regulatory guidance.

	
1.9

	
"Early Termination" means the Executive's Separation from Service before attainment of Normal Retirement Age except when such Separation from Service occurs within twenty-four (24) months following a Change in Control or due to death or Termination for Cause.

	
1.10

	
"Effective Date" means January 18, 2017.

	
1.11

	
"Normal Retirement Age" means the Executive's age sixty-five (65).

	
1.12

	
"Plan Administrator" means the Board or such committee or person as the Board shall appoint.

	
1.13

	
"Plan Year" means each twelve (12) month period commencing on January 1 and ending on December 31 of each year.  The initial Plan Year shall commence on the Effective Date of this Agreement and end on the following December 31.

	
1.14

	
"Separation from Service" means termination of the Executive's employment with the Bank for reasons other than death or Disability.  Whether a Separation from Service has occurred is determined in accordance with the requirements of Code Section 409A based on whether the facts and circumstances indicate that the Bank and Executive reasonably anticipated that no further services would be performed after a certain date or that the level of bona fide services the Executive would perform after such date (whether as an employee or as an independent contractor) would permanently decrease to no more than twenty percent (20%) of the average level of bona fide services performed (whether as an employee or an independent contractor) over the immediately preceding thirty-six (36) month period (or the full period of services to the Bank if the Executive has been providing services to the Bank less than thirty-six (36) months).

2

 

	
1.15

	
"Specified Employee" means an employee who at the time of Separation from Service is a key employee of the Bank, if any stock of the Bank is publicly traded on an established securities market or otherwise.  For purposes of this Agreement, an employee is a key employee if the employee meets the requirements of Code Section 416(i)(1)(A)(i), (ii), or (iii) (applied in accordance with the regulations thereunder and disregarding section 416(i)(5)) at any time during the twelve (12) month period ending on December 31 (the "identification period").  If the employee is a key employee during an identification period, the employee is treated as a key employee for purposes of this Agreement during the twelve (12) month period that begins on the first day of April following the close of the identification period.

	
1.16

	
"Termination for Cause" means Separation from Service for:

	
(a)

	
Gross negligence or gross neglect of duties to the Bank;

	
(b)

	
Conviction of a felony or of a gross misdemeanor involving moral turpitude in connection with the Executive's employment with the Bank; or

	
(c)

	
Fraud, disloyalty, dishonesty or willful violation of any law or significant Bank policy committed in connection with the Executive's employment and resulting in a material adverse effect on the Bank.

Article 2

Distributions During Lifetime

	2.1	
Normal Retirement Benefit.  Upon or after the Executive's attainment of Normal Retirement Age, the Bank shall distribute to the Executive the benefit described in this Section 2.1 in lieu of any other benefit under this Article.

		2.1.1	
Amount of Benefit.  The annual benefit under this Section 2.1 is Thirty Thousand Dollars ($30,000).

		2.1.2	
Distribution of Benefit.  The Bank shall distribute the annual benefit to the Executive in twelve (12) equal monthly installments commencing on the first day of the month following Normal Retirement Age.  The annual benefit shall be distributed to the Executive for fifteen (15) years.

	2.2	
Early Termination Benefit.  If Early Termination occurs, the Bank shall distribute to the Executive the benefit described in this Section 2.2 in lieu of any other benefit under this Article.

3

2.2.1    Amount of Benefit.  The benefit under this Section 2.2 is the Accrual Balance determined as of the end of the month preceding Separation from Service, subject to the following vesting schedule:

	
Completed Plan Years

	 Vested Percentage
	
1

	
10%

	
2

	
20%

	
3

	
30%

	
4

	
40%

	
5

	
50%

	
6

	
60%

	
7

	
70%

	
8

	
80%

	
9

	
90%

	
10+

	
100%

 

2.2.2        Distribution of Benefit.  The Bank shall distribute the benefit to the Executive in one hundred eighty (180) equal monthly installments commencing on the first day of the month following Normal Retirement Age.

	2.3	
Disability Benefit.  If the Executive experiences a Disability prior to Normal Retirement Age, the Bank shall distribute to the Executive the benefit described in this Section 2.3 in lieu of any other benefit under this Article.

		2.3.1	
Amount of Benefit.  The annual benefit under this Section 2.3 is Thirty Thousand Dollars ($30,000).

		2.3.2	
Distribution of Benefit.  The Bank shall distribute the benefit to the Executive in one hundred eighty (180) equal monthly installments commencing on the first day of the month following Normal Retirement Age.

	2.4	
Change in Control Benefit.  If a Change in Control occurs prior to Normal Retirement Age, followed within twenty-four (24) months by Separation from Service, the Bank shall distribute to the Executive the benefit described in this Section 2.4 in lieu of any other benefit under this Article.

		2.4.1	
Amount of Benefit.  The annual benefit under this Section 2.4 is Thirty Thousand Dollars ($30,000).

		2.4.2	
Distribution of Benefit.  The Bank shall distribute the benefit to the Executive in one hundred eighty (180) equal monthly installments commencing on the first day of the month following Normal Retirement Age.

		2.4.3	
Parachute Payments.  Notwithstanding any provision of this Agreement to the contrary, and to the extent allowed by Code Section 409A, if any benefit payment under this Section 2.4 would be treated as an "excess parachute payment" under Code Section 280G, the Bank shall reduce such benefit payment to the extent necessary to avoid treating such benefit payment as an excess parachute payment.

4

	2.5	
Restriction on Commencement of Distributions.  Notwithstanding any provision of this Agreement to the contrary, if the Executive is considered a Specified Employee, the provisions of this Section 2.5 shall govern all distributions hereunder.  If benefit distributions which would otherwise be made to the Executive due to Separation from Service are limited because the Executive is a Specified Employee, then such distributions shall not be made during the first six (6) months following Separation from Service.  Rather, any distribution which would otherwise be paid to the Executive during such period shall be accumulated and paid to the Executive in a lump sum on the first day of the seventh month following Separation from Service.  All subsequent distributions shall be paid in the manner specified.

	2.6	
Distributions Upon Taxation of Amounts Deferred. If, pursuant to Code Section 409A, the Federal Insurance Contributions Act or other state, local or foreign tax, the Executive becomes subject to tax on the amounts deferred hereunder, then the Bank may make a limited distribution to the Executive in a manner that conforms to the requirements of Code Section 409A.  Any such distribution will decrease the Executive's benefits distributable under this Agreement.

	2.7	
Change in Form or Timing of Distributions.  For distribution of benefits under this Article 2, the Executive and the Bank may, subject to the terms of Section 8.1, amend this Agreement to delay the timing or change the form of distributions.  Any such amendment:

 

	
(a)

	
may not accelerate the time or schedule of any distribution, except as provided in Code Section 409A;

	
(b)

	
must, for benefits distributable under Sections 2.1, 2.2 and 2.4, delay the commencement of distributions for a minimum of five (5) years from the date the first distribution was originally scheduled to be made; and

	
(c)

	
must take effect not less than twelve (12) months after the amendment is made.

Article 3

Distribution at Death

	3.1	
Death During Active Service.  If the Executive dies prior to Separation from Service, the Bank shall distribute to the Beneficiary the benefit described in this Section 3.1.  This benefit shall be distributed in lieu of any benefit under Article 2.

		3.1.1	
Amount of Benefit.  The annual benefit under this Section 3.1 is Thirty Thousand Dollars ($30,000).

5

		3.1.2	
Distribution of Benefit.  The Bank shall distribute the annual benefit to the Beneficiary in twelve (12) equal monthly installments for fifteen (15) years commencing on the first day of the fourth month following the Executive's death. The Beneficiary shall be required to provide to the Bank the Executive's death certificate.

	3.2	
Death During Distribution of a Benefit.  If the Executive dies after any benefit distributions have commenced under this Agreement but before receiving all such distributions, the Bank shall distribute to the Beneficiary the remaining benefits at the same time and in the same amounts they would have been distributed to the Executive had the Executive survived.

	3.3	
Death Before Benefit Distributions Commence.  If the Executive is entitled to benefit distributions under this Agreement but dies prior to the date that commencement of said benefit distributions are scheduled to be made under this Agreement, the Bank shall distribute to the Beneficiary the same benefits to which the Executive was entitled prior to death, except that the benefit distributions shall be paid in the manner specified in Section 3.1.2 and shall commence on the first day of the fourth month following the Executive's death.

Article 4

Beneficiaries

	4.1	
In General.  The Executive shall have the right, at any time, to designate a Beneficiary to receive any benefit distributions under this Agreement upon the death of the Executive.  The Beneficiary designated under this Agreement may be the same as or different from the beneficiary designated under any other plan of the Bank in which the Executive participates.

	4.2	
Designation.  The Executive shall designate a Beneficiary by completing and signing the Beneficiary Designation Form and delivering it to the Plan Administrator or its designated agent.  If the Executive names someone other than the Executive's spouse as a Beneficiary, the Plan Administrator may, in its sole discretion, determine that spousal consent is required to be provided in a form designated by the Plan Administrator, executed by the Executive's spouse and returned to the Plan Administrator.  The Executive's beneficiary designation shall be deemed automatically revoked if the Beneficiary predeceases the Executive or if the Executive names a spouse as Beneficiary and the marriage is subsequently dissolved.  The Executive shall have the right to change a Beneficiary by completing, signing and otherwise complying with the terms of the Beneficiary Designation Form and the Plan Administrator's rules and procedures.  Upon the acceptance by the Plan Administrator of a new Beneficiary Designation Form, all Beneficiary designations previously filed shall be cancelled.  The Plan Administrator shall be entitled to rely on the last Beneficiary Designation Form filed by the Executive and accepted by the Plan Administrator prior to the Executive's death.

6

	4.3	
Acknowledgment.  No designation or change in designation of a Beneficiary shall be effective until received, accepted and acknowledged in writing by the Plan Administrator or its designated agent.

	4.4	
No Beneficiary Designation.  If the Executive dies without a valid beneficiary designation, or if all designated Beneficiaries predecease the Executive, then the Executive's spouse shall be the designated Beneficiary.  If the Executive has no surviving spouse, any benefit shall be paid to the Executive's estate.

	4.5	
Facility of Distribution.  If the Plan Administrator determines in its discretion that a benefit is to be distributed to a minor, to a person declared incompetent or to a person incapable of handling the disposition of that person's property, the Plan Administrator may direct distribution of such benefit to the guardian, legal representative or person having the care or custody of such minor, incompetent person or incapable person.  The Plan Administrator may require proof of incompetence, minority or guardianship as it may deem appropriate prior to distribution of the benefit.  Any distribution of a benefit shall be a distribution for the account of the Executive and the Beneficiary, as the case may be, and shall completely discharge any liability under this Agreement for such distribution amount.

Article 5

General Limitations

	5.1	
Termination for Cause.  Notwithstanding any provision of this Agreement to the contrary, the Bank shall not distribute any benefit under this Agreement if the Executive's employment with the Bank is terminated by the Bank or an applicable regulator due to a Termination for Cause.

	5.2	
Suicide or Misstatement.  No benefit shall be distributed if the Executive commits suicide within two (2) years after the Effective Date.

	
5.3

	
Removal.  Notwithstanding any provision of this Agreement to the contrary, the Bank shall not distribute any benefit under this Agreement if the Executive is subject to a final removal or prohibition order issued by an appropriate federal banking agency pursuant to Section 8(e) of the Federal Deposit Insurance Act.  Notwithstanding anything herein to the contrary, any payments made to the Executive pursuant to this Agreement, or otherwise, shall be subject to and conditioned upon compliance with 12 U.S.C. 1828 and FDIC Regulation 12 CFR Part 359, Golden Parachute Indemnification Payments and any other regulations or guidance promulgated thereunder.

	5.4	
Forfeiture Provision.  The Executive shall forfeit any non-distributed benefits under this Agreement if during the term of this Agreement and within twelve (12) months following a Separation from Service, the Executive, directly or indirectly, either as an individual or as a proprietor, stockholder, partner, officer, director, employee, agent, consultant or independent contractor of any individual, partnership, corporation or other entity (excluding an ownership interest of three percent (3%) or less in the stock of a publicly-traded company):

7

		(i)	
becomes employed by, participates in, or becomes connected in any manner with the ownership, management, operation or control of any other bank, savings and loan, mortgage company, or other similar financial institution if such other bank, savings and loan, mortgage company or other similar financial institution maintains any office in Hartford County Connecticut as of the date of the termination of the Executive's employment;

		(ii)	
participates in any way in hiring or otherwise engaging, or assisting any other person or entity in hiring or otherwise engaging, on a temporary, part-time or permanent basis, any individual who was employed by the Bank as of the date of termination of the Executive's employment;

		(iii)	
assists, advises, or serves in any capacity, representative or otherwise, any third party in any action against the Bank or transaction involving the Bank;

		(iv)	
sells, offers to sell, provides banking, mortgage, or other financial services, assists any other person in selling or providing banking, mortgage, or other financial services, or solicits or otherwise competes for, either directly or indirectly, any orders, contract, or accounts for services of a kind or nature like or substantially similar to the financial services performed or financial products sold by the Bank (the preceding hereinafter referred to as "Services"), to or from any person or entity from whom the Executive or the Bank, to the knowledge of the Executive provided banking or other financial services, sold, offered to sell or solicited orders, contracts or accounts for Services during the three (3) year period immediately prior to the termination of the Executive's employment;

		(v)	
divulges, discloses, or communicates to others in any manner whatsoever, any confidential information of the Bank, to the knowledge of the Executive, including, but not limited to, the names and addresses of customers or prospective customers, of the Bank, as they may have existed from time to time, of work performed or services rendered for any customer, any method and/or procedures relating to projects or other work developed for the Bank, earnings or other information concerning the Bank. The restrictions contained in this subparagraph (v) apply to all information regarding the Bank, regardless of the source who provided or compiled such information.  Notwithstanding anything to the contrary, all information referred to herein shall not be disclosed unless and until it becomes known to the general public from sources other than the Executive.

	5.5	
Change in Control.  The forfeiture provision detailed in Section 5.4 hereof shall not be enforceable following a Change in Control.

8

 

Article 6

Administration of Agreement

	6.1	
Plan Administrator Duties.  The Plan Administrator shall administer this Agreement according to its express terms and shall also have the discretion and authority to (i) make, amend, interpret and enforce all appropriate rules and regulations for the administra-tion of this Agreement and (ii) decide or resolve any and all ques-tions, including interpretations of this Agreement, as may arise in connection with this Agreement to the extent the exercise of such discretion and authority does not conflict with Code Section 409A.

	6.2	
Agents.  In the administration of this Agreement, the Plan Administrator may employ agents and delegate to them such administrative duties as the Plan Administrator sees fit, including acting through a duly appointed representative, and may from time to time consult with counsel who may be counsel to the Bank.

	6.3	
Binding Effect of Decisions.  Any decision or action of the Plan Administrator with respect to any question arising out of or in connection with the administration, interpretation or application of this Agreement and the rules and regulations promulgated hereunder shall be final and conclusive and binding upon all persons having any interest in this Agreement.

	6.4	
Indemnity of Plan Administrator.  The Bank shall indemnify and hold harmless the Plan Administrator against any and all claims, losses, damages, expenses or liabilities arising from any action or failure to act with respect to this Agreement, except in the case of willful misconduct by the Plan Administrator.

	6.5	
Bank Information.  To enable the Plan Administrator to perform its functions, the Bank shall supply full and timely information to the Plan Administrator on all matters relating to the date and circum-stances of the Executive's death, Disability or Separation from Service, and such other pertinent information as the Plan Administrator may reasonably require.

Article 7

Claims And Review Procedures

	7.1	
Claims Procedure.  An Executive or Beneficiary ("claimant") who has not received benefits under this Agreement that he or she believes should be distributed shall make a claim for such benefits as follows:

		7.1.1	
Initiation – Written Claim.  The claimant initiates a claim by submitting to the Plan Administrator a written claim for the benefits.  If such a claim relates to the contents of a notice received by the claimant, the claim must be made within sixty (60) days after such notice was received by the claimant.  All other claims must be made within one hundred eighty (180) days of the date on which the event that caused the claim to arise occurred.  The claim must state with particularity the determination desired by the claimant.

9

		7.1.2	
Timing of Plan Administrator Response.  The Plan Administrator shall respond to such claimant within ninety (90) days after receiving the claim.  If the Plan Administrator determines that special circumstances require additional time for processing the claim, the Plan Administrator can extend the response period by an additional ninety (90) days by notifying the claimant in writing, prior to the end of the initial ninety (90) day period, that an additional period is required.  The notice of extension must set forth the special circumstances and the date by which the Plan Administrator expects to render its decision.

		7.1.3	
Notice of Decision.  If the Plan Administrator denies part or all of the claim, the Plan Administrator shall notify the claimant in writing of such denial.  The Plan Administrator shall write the notification in a manner calculated to be understood by the claimant.  The notification shall set forth:

		(a)	
The specific reasons for the denial;

		(b)	
A reference to the specific provisions of this Agreement on which the denial is based;

		(c)	
A description of any additional information or material necessary for the claimant to perfect the claim and an explanation of why it is needed;

		(d)	
An explanation of this Agreement's review procedures and the time limits applicable to such procedures; and

		(e)	
A statement of the claimant's right to bring a civil action under ERISA Section 502(a) following an adverse benefit determination on review.

	7.2	
Review Procedure.  If the Plan Administrator denies part or all of the claim, the claimant shall have the opportunity for a full and fair review by the Plan Administrator of the denial as follows:

		7.2.1	
Initiation – Written Request.  To initiate the review, the claimant, within sixty (60) days after receiving the Plan Administrator's notice of denial, must file with the Plan Administrator a written request for review.

		7.2.2	
Additional Submissions – Information Access.  The claimant shall then have the opportunity to submit written comments, documents, records and other information relating to the claim.  The Plan Administrator shall also provide the claimant, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant (as defined in applicable ERISA regulations) to the claimant's claim for benefits.

		7.2.3	
Considerations on Review.  In considering the review, the Plan Administrator shall take into account all materials and information the claimant submits relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination.

10

		7.2.4	
Timing of Plan Administrator Response.  The Plan Administrator shall respond in writing to such claimant within sixty (60) days after receiving the request for review.  If the Plan Administrator determines that special circumstances require additional time for processing the claim, the Plan Administrator can extend the response period by an additional sixty (60) days by notifying the claimant in writing, prior to the end of the initial sixty (60) day period, that an additional period is required.  The notice of extension must set forth the special circumstances and the date by which the Plan Administrator expects to render its decision.

		7.2.5	
Notice of Decision.  The Plan Administrator shall notify the claimant in writing of its decision on review.  The Plan Administrator shall write the notification in a manner calculated to be understood by the claimant.  The notification shall set forth:

		(a)	
The specific reasons for the denial;

		(b)	
A reference to the specific provisions of this Agreement on which the denial is based;

		(c)	
A statement that the claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant (as defined in applicable ERISA regulations) to the claimant's claim for benefits; and

		(d)	
A statement of the claimant's right to bring a civil action under ERISA Section 502(a).

Article 8

Amendments and Termination

	
8.1

	
Amendments.  This Agreement may be amended only by a written agreement signed by the Bank and the Executive.  However, the Bank may unilaterally amend this Agreement to conform with written directives to the Bank from its auditors or banking regulators or to comply with legislative changes or tax law, including without limitation Code Section 409A.

	
8.2

	
Plan Termination Generally.  This Agreement may be terminated only by a written agreement signed by the Bank and the Executive.  The benefit shall be the Accrual Balance as of the date this Agreement is terminated.  Except as provided in Section 8.3, the termination of this Agreement shall not cause a distribution of benefits under this Agreement.  Rather, upon such termination benefit distributions will be made at the earliest distribution event permitted under Article 2 or Article 3.

11

	
8.3

	
Plan Terminations Under Code Section 409A.  Notwithstanding anything to the contrary in Section 8.2, if the Bank terminates this Agreement in the following circumstances:

		(a)	
Within thirty (30) days before or twelve (12) months after a Change in Control, provided that all distributions are made no later than twelve (12) months following such termination of this Agreement and further provided that all the Bank's arrangements which are substantially similar to this Agreement are terminated so the Executive and all participants in the similar arrangements are required to receive all amounts of compensation deferred under the terminated arrangements within twelve (12) months of such termination;

		(b)	
Upon the Bank's dissolution or with the approval of a bankruptcy court provided that the amounts deferred under this Agreement are included in the Executive's gross income in the latest of (i) the calendar year in which this Agreement terminates; (ii) the calendar year in which the amount is no longer subject to a substantial risk of forfeiture; or (iii) the first calendar year in which the distribution is administratively practical; or

		(c)	
Upon the Bank's termination of this and all other arrangements that would be aggregated with this Agreement pursuant to Treasury Regulations Section 1.409A-1(c) if the Executive participated in such arrangements ("Similar Arrangements"), provided that (i) the termination and liquidation does not occur proximate to a downturn in the financial health of the Bank, (ii) all termination distributions are made no earlier than twelve (12) months and no later than twenty-four (24) months following such termination, and (iii) the Bank does not adopt any new arrangement that would be a Similar Arrangement for a minimum of three (3) years following the date the Bank takes all necessary action to irrevocably terminate and liquidate the Agreement;

the Bank may distribute the Accrual Balance, determined as of the date of the termination of this Agreement, to the Executive in a lump sum subject to the above terms.

Article 9

Miscellaneous

	9.1	
Binding Effect.  This Agreement shall bind the Executive and the Bank and their beneficiaries, survivors, executors, administrators and transferees.

	9.2	
No Guarantee of Employment.  This Agreement is not a contract for employment.  It does not give the Executive the right to remain as an employee of the Bank nor interfere with the Bank's right to discharge the Executive.  It does not require the Executive to remain an employee nor interfere with the Executive's right to terminate employment at any time.

	9.3	
Non-Transferability.  Benefits under this Agreement cannot be sold, transferred, assigned, pledged, attached or encumbered in any manner.

12

 

	9.4	
Tax Withholding and Reporting.  The Bank shall withhold any taxes that are required to be withheld, including but not limited to taxes owed under Code Section 409A from the benefits provided under this Agreement.  The Executive acknowledges that the Bank's sole liability regarding taxes is to forward any amounts withheld to the appropriate taxing authorities.  The Bank shall satisfy all applicable reporting requirements, including those under Code Section 409A.

	9.5	
Applicable Law.  This Agreement and all rights hereunder shall be governed by the laws of the State of Connecticut, except to the extent preempted by the laws of the United States of America.

	9.6	
Unfunded Arrangement.  The Executive and the Beneficiary are general unsecured creditors of the Bank for the distribution of benefits under this Agreement.  The benefits represent the mere promise by the Bank to distribute such benefits.  The rights to benefits are not subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, attachment or garnishment by creditors.  Any insurance on the Executive's life or other informal funding asset is a general asset of the Bank to which the Executive and Beneficiary have no preferred or secured claim.

	9.7	
Reorganization.  The Bank shall not merge or consolidate into or with another bank, or reorganize, or sell substantially all of its assets to another bank, firm or person unless such succeeding or continuing bank, firm or person agrees to assume and discharge the obligations of the Bank under this Agreement.  Upon the occurrence of such an event, the term "Bank" as used in this Agreement shall be deemed to refer to the successor or survivor entity.

	9.8	
Entire Agreement.  This Agreement constitutes the entire agreement between the Bank and the Executive as to the subject matter hereof.  No rights are granted to the Executive by virtue of this Agreement other than those specifically set forth herein.

	9.9	
Interpretation.  Wherever the fulfillment of the intent and purpose of this Agreement requires and the context will permit, the use of the masculine gender includes the feminine and use of the singular includes the plural.

	9.10	
Alternative Action.  In the event it shall become impossible for the Bank or the Plan Administrator to perform any act required by this Agreement due to regulatory or other constraints, the Bank or Plan Administrator may perform such alternative act as most nearly carries out the intent and purpose of this Agreement and is in the best interests of the Bank, provided that such alternative act does not violate Code Section 409A.

	9.11	
Headings.  Article and section headings are for convenient reference only and shall not control or affect the meaning or construction of any provision herein.

	9.12	
Validity.  If any provision of this Agreement shall be illegal or invalid for any reason, said illegality or invalidity shall not affect the remaining parts hereof, but this Agreement shall be construed and enforced as if such illegal or invalid provision had never been included herein.

13

	9.13	
Notice.  Any notice or filing required or permitted to be given to the Bank or Plan Administrator under this Agreement shall be sufficient if in writing and hand-delivered or sent by registered or certified mail to the address below:

	 	
The Simsbury Bank & Trust Company, Inc.

	 
	 	
86 Hopmeadow Street

	 
	 	
Weatogue, CT 06089

	 

Such notice shall be deemed given as of the date of delivery or, if delivery is made by mail, as of the date shown on the postmark on the receipt for registration or certification.

Any notice or filing required or permitted to be given to the Executive under this Agreement shall be sufficient if in writing and hand-delivered or sent by mail to the last known address of the Executive.

	9.14	
Deduction Limitation on Benefit Payments.  If the Bank reasonably anticipates that the Bank's deduction with respect to any distribution under this Agreement would be limited or eliminated by application of Code Section 162(m), then to the extent deemed necessary by the Bank to ensure that the entire amount of any distribution from this Agreement is deductible, the Bank may delay payment of any amount that would otherwise be distributed under this Agreement.  The delayed amounts shall be distributed to the Executive (or the Beneficiary in the event of the Executive's death) at the earliest date the Bank reasonably anticipates that the deduction of the payment of the amount will not be limited or eliminated by application of Code Section 162(m).

	9.15	
Compliance with Section 409A.  This Agreement shall be interpreted and administered consistent with Code Section 409A.

IN WITNESS WHEREOF, the Executive and a duly authorized representative of the Bank have signed this Agreement.

 

	
EXECUTIVE

	 	
THE SIMSBURY BANK & TRUST COMPANY, INC.

	
 

	 	
 

	
 

	 
	 	 	 	 	 
	 	 	 	 	 
	
/s/ Richard J. Sudol

	 	
By: 

	
/s/ Martin J. Geitz 

	 
	 Richard J. Sudol	 	   		 
	 	 	  Title:	President & CEO 	 

                                                   

14

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