Document:

EX-10.2

 Exhibit 10.2 

DONEGAL GROUP INC. 
 2019 EQUITY
INCENTIVE PLAN FOR DIRECTORS 
 1.    Purpose. The purpose of this 2019 Equity Incentive Plan for Directors
(this “Plan”) is to enhance the ability of Donegal Group Inc. (the “Company”) and Donegal Mutual Insurance Company (“Donegal Mutual,” and together with the respective subsidiaries and affiliates of the Company and
Donegal Mutual, the “Group”) to attract and retain highly qualified directors, to establish a basis for providing a portion of director compensation in the form of equity and, in doing so, to strengthen the alignment of the interests of
the directors of the members of the Group with the interests of the Company’s stockholders. 

2.    Administration. 

(a)    Administration by the Board. The Board of Directors of the Company (the “Board”) shall administer
this Plan. 
 (b)    Duty and Powers of the Board. The Board shall have the power to interpret this Plan and the
awards granted under this Plan and to adopt rules for the administration, interpretation and application of this Plan. The Board shall have the discretion to determine to whom the Company will grant stock options and to determine the number of stock
options the Company will grant to any director, the timing of the grant and the terms of exercise. The Board shall not have any discretion to determine to whom the Company will grant restricted stock awards under this Plan. 

(c)    Compensation; Professional Assistance; Good Faith Actions. Members of the Board shall not receive any
compensation for their services in administering this Plan. The Company shall pay all expenses and liabilities incurred in connection with the administration of this Plan. The Company may employ attorneys, consultants, accountants or other experts.
The Board, the Company, Donegal Mutual and the officers and directors of the Company and Donegal Mutual shall be entitled to rely upon the advice, opinions or valuations of any such experts. All actions taken and all interpretations and
determinations the Board makes in good faith with respect to this Plan shall be final and binding upon all grantees, the Group and all other interested persons. No member of the Board shall be personally liable for any action, determination or
interpretation the Board makes in good faith with respect to this Plan, and the Company shall fully protect and indemnify all members of the Board in respect to any such action, determination or interpretation. 

3.    Shares Subject to this Plan. 

(a)    Shares Authorized. The shares of stock issuable pursuant to awards granted under this Plan shall be shares
of the Company’s Class A common stock. The total aggregate number of shares of Class A common stock that the Company may issue under this Plan is 500,000 shares, subject to adjustment as described below. The shares may be authorized
but unissued shares or reacquired shares for purposes of this Plan. 
 (b)    Share Counting. For administrative
purposes, when the Board approves an award payable in shares of Class A common stock, the Board shall reserve, and count against the share limit, shares equal to the maximum number of shares that the Company may issue under the award. If and to
the extent options or awards granted under this Plan terminate, expire or are canceled, forfeited, exchanged or surrendered without having been exercised, and if and to the extent that any restricted stock awards are forfeited or terminated, or
otherwise are not paid in full, the Company shall make the shares reserved for such options and awards available again for purposes of this Plan. 

(c)    Individual Limits. All awards under this Plan shall be expressed in shares of Class A common stock. The
maximum number of shares of Class A common stock with respect to all awards that the Company may issue to any director under this Plan during any calendar year shall be 15,000 shares, subject to adjustment as described below. 

  
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 (d)    Adjustments. If any change in the number or kind of shares
of Class A common stock outstanding occurs by reason of: 
  

	 	•	 	 a stock dividend, spinoff, recapitalization, stock split or combination or exchange of shares;

  

	 	•	 	 a merger, reorganization or consolidation; 

 

	 	•	 	 a reclassification or change in par value; or 

 

	 	•	 	 any other extraordinary or unusual event affecting the outstanding Class A common stock as a class without
the Company’s receipt of consideration, or if the value of the outstanding shares of Class A common stock is substantially reduced as a result of a spinoff or the Company’s payment of any extraordinary dividend or distribution in
cash, 

 the maximum number of shares of Class A common stock available for issuance under this Plan, the maximum number of shares of
Class A common stock for which any individual may receive grants in any year, the kind and number of shares covered by outstanding awards, the kind and number of shares to be issued or issuable under this Plan and the price per share or
applicable market value of such grants shall be automatically and equitably adjusted to reflect any increase or decrease in the number of, or change in the kind or value of, issued shares of Class A common stock to preclude, to the extent
practicable, the enlargement or dilution of rights and benefits under this Plan and such outstanding grants. Any fractional shares resulting from such adjustment shall be eliminated. Any adjustments to outstanding awards shall be consistent with
Section 409A of the Internal Revenue Code of 1986, as amended, or the Code, to the extent applicable. 

4.    Eligibility for Participation. Each director of the Company and each director of a member of the Group who is
not eligible to receive stock options under the Company’s Equity Incentive Plan for Employees shall be eligible to receive stock options under this Plan. Each director of the Company and each director of the member companies of the Group shall
be eligible to receive restricted stock awards under this Plan. 
 5.    Awards. Awards under this Plan may
consist of stock options as described in Section 7 and restricted stock awards as described in Section 8. Each award shall be evidenced by a written agreement between the Company and the grantee. 

6.    Definition of Fair Market Value. For purposes of this Plan, “fair market value” shall mean the last
sales price of a share of Class A common stock on the NASDAQ Global Select Market (“NASDAQ”) on the day immediately preceding the date on which the Board determines the fair market value of a share of Class A common stock. In the
event that there are no transactions in shares of Class A common stock on NASDAQ on such day, the Board shall determine the fair market value as of the immediately preceding day on which there were transactions in shares of Class A common
stock on NASDAQ. If shares of Class A common stock are not listed by NASDAQ, the Board shall determine the fair market value pursuant to Section 422 of the Code. 

7.    Stock Options. 

(a)    Granting of Stock Options. The Board may grant stock options to an eligible director upon such terms as the
Board deems appropriate under this Section 7. 
 (b)    Type of Stock Option and Price. The Board may grant
stock options to purchase Class A common stock that the Board does not intend to qualify as incentive stock options within the meaning of Section 422 of the Code. The Board shall determine the exercise price of shares of Class A
common stock subject to a stock option, which shall be the closing market price of a share of Class A common stock on NASDAQ on the day before the date of the grant. 

(c)    Exercisability of Stock Options. Each stock option agreement shall specify the period or periods of time
within which a grantee may exercise a stock option, in whole or in part, as the Board determines. No grantee may exercise a stock option after five years from the grant date of the stock option. The Board may accelerate the exercisability of any or
all outstanding stock options at any time for any reason. 

  
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 (d)    Rights upon Termination of Service. Upon a grantee’s
termination of service as a director, as a result of resignation, retirement, failure to be re-elected, removal for cause or any reason other than death, the grantee shall have the right to exercise the stock
option during its term within a period of three years after such termination to the extent that the stock option was exercisable at the time of termination, or within such other period and subject to such terms and conditions as the Board may
specify. In the event that a grantee dies prior to the expiration of the grantee’s stock option and without having fully exercised the grantee’s stock option, the grantee’s representative or successor shall have the right to exercise
the stock option during its term within a period of one year after the grantee’s death to the extent that the stock option was exercisable at the time of death, or within such other period, and subject to such terms and conditions, as the Board
may specify. 
 (e)    Exercise of Stock Options. A grantee may exercise a stock option that has become
exercisable, in whole or in part, by delivering a notice of exercise to the Company. The grantee shall pay the exercise price set forth in the stock option: 
  

	 	•	 	 in cash; 

  

	 	•	 	 by delivery of shares of Class A common stock at fair market value, shares of Class B common stock at
fair market value, or a combination of those shares, as the Board may determine from time to time and subject to the terms and conditions as the Board may prescribe; 

 

	 	•	 	 by payment through a brokerage firm of national standing whereby the grantee will simultaneously exercise the
stock option and sell the shares acquired upon exercise through the brokerage firm and the brokerage firm shall remit to the Company from the proceeds of the sale of the shares the exercise price as to which the option has been exercised in
accordance with the procedures permitted by Regulation T of the Federal Reserve Board; or 

  

	 	•	 	 by any other method the Board authorizes. 

The Company must receive payment for the shares acquired upon exercise of the stock option, and any required withholding taxes and related amounts, by the
time the Board specifies depending on the type of payment being made, but in all cases prior to the issuance of the shares issuable upon exercise of the option. 

8.    Restricted Stock Awards. 

(a)    Granting of Awards. The Company shall grant each director of the Company and each director of Donegal Mutual
an annual restricted stock award consisting of 500 shares of Class A common stock, except that a person who serves as a director on both boards shall receive only one annual grant. The Company shall grant the restricted stock awards on the
first business day of January in each year, provided that the director served as a member of the Board or of the board of directors of Donegal Mutual during any portion of the preceding calendar year. 

(b)    Terms of Restricted Stock Awards. Each restricted stock award agreement shall contain such restrictions,
terms and conditions as this Plan requires: 
  

	 	•	 	 The grantee may not sell or otherwise transfer the shares of Class A common stock comprising the restricted
stock award until one year after the date of grant. Although the Company shall register the shares of Class A common stock comprising each restricted stock award in the name of the grantee, the Company reserves the right to place a restrictive
legend on the stock certificate. None of such shares of Class A common stock shall be subject to forfeiture. 

  

	 	•	 	 Subject to the restrictions on transfer set forth in this Section 8(b), a grantee shall have all the rights
of a stockholder with respect to the shares of Class A common stock the Company issues pursuant to restricted stock awards made under this Plan, including the right to vote the shares and to receive all dividends and other distributions paid or
made with respect to the shares. 

  
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	 	•	 	 In the event of changes in the Class A common stock of the Company by reason of stock dividends, split-ups or combinations of shares, reclassifications, mergers, consolidations, reorganizations or liquidations while the shares comprising a restricted stock award shall be subject to restrictions on transfer, any
and all new, substituted or additional securities to which the grantee shall be entitled by reason of the ownership of a restricted stock award shall be subject immediately to the terms, conditions and restrictions of this Plan.

  

	 	•	 	 If a grantee receives rights or warrants with respect to any shares comprising a restricted stock award, the
grantee may hold, exercise, sell or otherwise dispose of such rights or warrants or any shares or other securities acquired by the exercise of such rights or warrants free and clear of the restrictions and obligations set forth in this Plan.

 9.    Date of Grant. The grant date of a stock option under this Plan shall be the date of
the Board’s approval or such later date as the Board determines at the time it authorizes the grant. The Board may not make retroactive grants of stock options under this Plan. The Company shall provide notice of the grant to the grantee within
a commercially reasonable time after the grant date. 
 10.    Requirements for Issuance of Shares. The Company
will not issue shares of Class A common stock in connection with any award under this Plan until the issuance of the shares complies with all of the applicable legal requirements to the commercially reasonable satisfaction of the Board. The
Board shall have the right to condition any award made to any director on the director’s undertaking in writing to comply with the restrictions on the director’s subsequent disposition of shares subject to the award as the Board shall deem
necessary or advisable, and certificates representing those shares may be legended to reflect any such restrictions. Certificates representing shares of Class A common stock issued under this Plan will be subject to such stop-transfer orders
and other restrictions as applicable laws, regulations and interpretations may require, including any requirement that a legend be placed on the certificate. 

11.    Withholding. The Company shall have the right to require the grantee to remit to the Company an amount
sufficient to satisfy any federal, state or local withholding tax requirements prior to the delivery of any certificate for shares of Class A common stock. If and to the extent the Board authorizes, in its sole discretion, a grantee may make an
election, by means of a form of election the Board prescribes, to have shares of Class A common stock that are acquired upon exercise of a stock option withheld by the Company or to tender other shares of Class A common stock or other
securities of the Company owned by the grantee to the Company at the time of exercise of a stock option to pay the amount of tax that would otherwise be required by law to be withheld by the Company. Any such election shall be irrevocable and shall
be subject to termination by the Board, in its sole discretion, at any time. Any securities so withheld or tendered shall be valued by the Board as of the date of exercise. 

12.    Transferability of Awards. Only the grantee of an award may exercise rights under the award during the
grantee’s lifetime, and a grantee may not transfer those rights except by will or by the laws of descent and distribution. When a grantee dies, the personal representative or other person entitled to succeed to the rights of the grantee may
exercise those rights. Any successor to a grantee must furnish proof satisfactory to the Company of the successor’s right to receive the award under the grantee’s will or under the applicable laws of descent and distribution. Except as
stated in this Section 12, no stock option or interest therein and, for a period of one year after the date of grant, no restricted stock award or any interest therein, shall be subject to the debts, contracts or engagements of the grantee or
the grantee’s successors in interest, nor shall they be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means, whether such disposition is voluntary or involuntary or by operation of
law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings, including bankruptcy, and any attempted disposition thereof shall be null and void and of no effect. 

  
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 13.     Amendment and Termination of this Plan. 

(a)    Amendments. The Board may amend or terminate this Plan at any time, except that the Board shall not amend
this Plan without approval of the stockholders of the Company if such approval is required in order to comply with the Code or applicable laws, or to comply with applicable stock exchange requirements. The Board may not, without the consent of the
grantee, negatively affect the rights of a grantee under any award previously granted under this Plan. 
 (b)    No
Repricing Without Stockholder Approval. The Board may not reprice stock options, nor may the Board amend this Plan to permit repricing of stock options unless the stockholders of the Company provide prior approval for the repricing. 

(c)    Termination. This Plan shall terminate on April 18, 2024, unless the Board earlier terminates this Plan
or the Board extends the term with the approval of the stockholders of the Company. The termination of this Plan shall not impair the power and authority of the Board with respect to an outstanding award. 

14.    Reservation of Shares. The Company, during the term of this Plan, shall at all times reserve and keep
available the number of shares of Class A common stock needed to satisfy the requirements of this Plan. The inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority the Company’s counsel
deems necessary to the lawful issuance and sale of any shares under this Plan, shall relieve the Company of any liability for the failure to issue any shares as to which the Company has not obtained the requisite authority. 

15.    No Prohibition on Corporate Action. No provision of this Plan shall be construed to prevent the Company or
any officer or director of the Company from taking any action the Company or such officer or director deems appropriate or in the Company’s best interest, whether or not such action could have an adverse effect on this Plan or any awards
granted under this Plan, and no grantee or grantee’s estate, personal representative or beneficiary shall have any claim against the Company or any officer or director of the Company as a result of the taking of the action. 

16.    Indemnification. With respect to the administration of this Plan, the Company shall indemnify each present
and future member of the Board against, and each member of the Board shall be entitled without further action on such member’s part to indemnity from the Company for, all expenses, including the amount of judgments and the amount of approved
settlements made with a view to the curtailment of costs of litigation, other than amounts paid to the Company itself, reasonably incurred by such member in connection with or arising out of, any action, suit or proceeding in which the member may be
involved by reason of being or having been a member of the Board, whether or not the member continues to be such member at the time of incurring such expenses; provided, however, that this indemnity shall not include any expenses incurred by any
such member of the Board (i) in respect of matters as to which the member shall be finally adjudged in any such action, suit or proceeding to have been guilty of gross negligence or willful misconduct in the performance of the member’s
duty as a member of the Board or (ii) in respect of any matter in which any settlement is effected for an amount in excess of the amount approved by the Company on the advice of its legal counsel; and provided further that no right of
indemnification under the provisions set forth in this Section 16 shall be available to or enforceable by any such member of the Board unless, within 60 days after institution of any such action, suit or proceeding, the member shall have
offered the Company in writing the opportunity to represent the member and defend same at its own expense. The foregoing right of indemnification shall inure to the benefit of the heirs, executors or administrators of each such member of the Board
and shall be in addition to all other rights to which such member may be entitled as a matter of law, contract or otherwise. 

17.    Miscellaneous Plan Provisions. 

(a)    Compliance with Plan Provisions. No grantee or other person shall have any right with respect to this Plan,
the Class A common stock reserved for issuance under this Plan or in any award until the Company and the grantee execute a written agreement and the Company and the grantee satisfy all the applicable terms, conditions and provisions of this
Plan and any award. 

  
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 (b)    Approval of Counsel. In the discretion of the Board, no
shares of Class A common stock, other securities or property of the Company or other forms of payment shall be issued hereunder with respect to any award unless counsel for the Company shall be satisfied that such issuance will be in compliance
with applicable federal, state, local and foreign legal, securities exchange and other applicable requirements. 

(c)    Compliance with Rule 16b-3. To the extent that Rule 16b-3 under the Securities Exchange Act of 1934, as amended, applies to awards granted under this Plan, it is the intention of the Company that this Plan comply in all respects with the requirements of Rule 16b-3, that any ambiguities or inconsistencies in construction of this Plan be interpreted to give effect to such intention and that if this Plan shall not so comply, whether on the date of adoption or by
reason of any later amendment to or interpretation of Rule 16b-3, the provisions of this Plan shall be deemed to have been automatically amended so as to bring them into full compliance with that rule.

 (d)    Section 409A Compliance. This Plan is intended to comply with the requirements of Section 409A of
the Code and the regulations issued thereunder. To the extent of any provision of this Plan is inconsistent with the requirements of Section 409A, this Plan shall be interpreted and amended in order to meet the requirements of
Section 409A. Notwithstanding anything contained in this Plan to the contrary, it is the intent of the Company to have this Plan be interpreted and construed to comply with any and all provisions of Section 409A including any subsequent
amendments, rulings or interpretations from appropriate governmental agencies. 
 (e)    Effects of Acceptance of the
Award. By accepting any award or other benefit under this Plan, the Company shall conclusively deem each grantee and each person claiming under or through the grantee to have indicated the grantee’s acceptance and ratification of, and
consent to, any action taken under this Plan by the Company, the Board or its delegates. 

  
 6EX-10.3

 Exhibit 10.3 

DONEGAL GROUP INC. 
 2011 EMPLOYEE
STOCK PURCHASE PLAN, AS AMENDED 
 Section 1.    Purpose. 

Donegal Group Inc. (the “Company”) has established this 2011 Employee Stock Purchase Plan (this “Plan”) for the benefit of
the eligible employees of the Company, its parent, Donegal Mutual Insurance Company (“Donegal Mutual”), participating subsidiaries of the Company and of Donegal Mutual and any company from which the Company or Donegal Mutual assumes 100%
quota share reinsurance. 
 The purpose of this Plan is to provide each eligible employee with an opportunity to acquire or increase his or
her proprietary interest in the Company through the purchase of shares of the Company’s Class A common stock (the “Class A common stock”) at a discount from the market prices prevailing at the time of purchase. The Company
intends that this Plan meet the requirements of Section 423 of the Internal Revenue Code of 1986, as amended (the “Code”). 

Section 2.    Eligible Employees. 

(a)    Employees eligible to participate in this Plan (“Eligible Employees”) will consist of all individuals:
(i) who are full-time employees, as defined in Section 2(b) of this Plan, of the Company, Donegal Mutual, any subsidiary, as defined in Section 424 of the Code, of the Company or Donegal Mutual or any company from which the Company or
Donegal Mutual assumes 100% quota share reinsurance (a “Participating Company”), and (ii) who have completed one month of employment on or prior to the date on which an Enrollment Period, as defined in Section 4 of this Plan,
begins. 
 (b)    A “full-time employee” is an employee of the Company, Donegal Mutual or any Participating
Company who works or is scheduled to work at least 1,000 hours during any calendar year. The Company will consider an employee who is not scheduled to work at least 1,000 hours during a calendar year, but who in fact works at least 1,000 hours
during a calendar year, a “full-time employee” once the employee is credited with at least 1,000 hours during such year. 

(c)    A person who is otherwise an Eligible Employee may not purchase any shares of Class A common stock under this
Plan to the extent that: (i) immediately after such person purchases Class A common stock, the person would own shares of Class A common stock, including shares that would be owned if all outstanding options to purchase Common Stock
such person holds were exercised, that possess 5% or more of the total combined voting power or value of all classes of stock of the Company or any subsidiary of the Company or (ii) such right would cause such person to have purchase rights
under this Plan and all other stock purchase plans of the Company or any subsidiary of the Company or Donegal Mutual that meet the requirements of Section 423 of the Code, that accrue at a rate that exceeds $25,000 of fair market value of the
stock of the Company, or any subsidiary of the Company, determined at the time the right to purchase Class A common stock under this Plan is exercisable, for each calendar year in which a purchase right under this Plan is outstanding. For this
purpose, a right to purchase Class A common stock accrues when such right first becomes exercisable during the calendar year, but the rate of accrual for any calendar year may in no event exceed $25,000 of the fair market value of Class A
common stock subject to the right, and the number of shares of Class A common stock under one right may not be carried over to any other right. 

(d)    Notwithstanding other provisions in this Plan to the contrary, any officer of the Company, Donegal Mutual or any
Participating Company who is subject to Section 16 of the Securities Exchange Act of 1934 (the “Exchange Act”) with respect to his or her ownership of shares of Class A common stock (a “Section 16 officer”) will be
subject to the restrictions and conditions set forth in Sections 7(b) and 9 of this Plan. 

  
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 Section 3.    Duration of Plan and Subscription
Periods. 
 This Plan is effective as of July 1, 2011 through and including June 30, 2022. During the term of this Plan, this
Plan will have 20 semi-annual “Subscription Periods.” Each Subscription Period will extend from July 1 through December 31 or from January 1 through June 30, respectively, with the first Subscription Period beginning on
July 1, 2011 and the last Subscription Period ending on June 30, 2022. 

Section 4.    Enrollment and Enrollment Period. 

Enrollment for participation in this Plan will take place during the “Enrollment Period” that precedes each Subscription Period.
Enrollment Periods are in effect from June 1 through June 30 and from December 1 through December 31 of each year. In addition, the Company will deem each individual who participates in the Company’s 2001 Employee Stock
Purchase Plan and who is an Eligible Employee as of May 31, 2011 as automatically enrolled in this Plan effective as of the first Subscription Period. Except as provided regarding automatic enrollment in this Plan as of the first Subscription
Period, any person who is an Eligible Employee and who would like to participate in this Plan should file a subscription agreement during an Enrollment Period, and that eligible employee’s participation in this Plan will then commence as of the
commencement of the next Subscription Period. Once enrolled, an Eligible Employee will continue to participate in this Plan for each succeeding Subscription Period until such Eligible Employee terminates his or her participation, the Eligible
Employee ceases to be an Eligible Employee or elects to withdraw from this Plan, this Plan expires or the Company terminates this Plan. An Eligible Employee who desires to change his or her rate of contribution may do so effective as of the
beginning of the next Subscription Period by submitting a properly completed and executed enrollment form to the Company during the Enrollment Period for the next Subscription Period. An Eligible Employee who is not a Section 16 officer may
also change his or her rate of contribution during a Subscription Period only pursuant to Section 7(b) of this Plan. 

Section 5.    Total Number of Shares Available. 

The total number of shares available under this Plan is 500,000 shares of Class A common stock. Such Class A common stock may be
authorized and unissued shares or previously issued shares that the Company reacquired. In the event the total number of shares available for purchase under this Plan have been purchased prior to the expiration of this Plan, the Company may
terminate this Plan in accordance with Section 13 of this Plan. 
 Section 6.    Subscription
Price. 
 The “Subscription Price” for each share of Class A common stock subscribed for purchase under this Plan during
each Subscription Period will be the lesser of (i) 85% of the fair market value of such share as determined as of the last trading day before the first day of the Enrollment Period with respect to such Subscription Period or (ii) 85% of
the fair market value of such share as determined on the last trading day of such Subscription Period. The fair market value of a share will be the closing price the NASDAQ Stock Market reports for the applicable date. 

Section 7.    Amount of Contribution and Method of Payment. 

(a)    An Eligible Employee must pay the Subscription Price through a payroll deduction. The maximum payroll deduction may
not be more than 10% of an Eligible Employee’s Base Pay, as defined in Section 7(c) of this Plan. An Eligible Employee must authorize a minimum payroll deduction, based on such employee’s Base Pay at the time of such authorization,
that will enable such employee to accumulate by the end of the Subscription Period an amount sufficient to purchase at least ten shares of Class A common stock. An Eligible Employee may not make separate cash deposits toward the payment of the
Subscription Price. 

  
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 (b)    An Eligible Employee who is not a Section 16 officer may at
any time during a Subscription Period reduce the amount the Eligible Employee previously authorized the Company to deduct from his or her Base Pay, provided the reduction conforms with the minimum payroll deduction set forth in Section 7(a) of
this Plan. To do so, an Eligible Employee should forward to the Company a properly completed and executed written notice setting forth the requested reduction in his or her payroll deduction. The change in payroll deduction will become effective on
a prospective basis as soon as practicable after the Company receives the change notice. An Eligible Employee may change his or her payroll deduction under this Section 7(b), by forwarding to the Company a properly completed and executed
written notice setting forth such reduction in his or her payroll deduction only once during any Subscription Period. Any such reduction will remain in effect for subsequent Subscription Periods, subject to compliance with Section 7(a) of this
Plan, until such Eligible Employee terminates his or her participation in this Plan, the Eligible Employee ceases to be an Eligible Employee, this Plan expires or the Company terminates this Plan. A Section 16 officer may not change his or her
rate of contribution during a Subscription Period. 
 (c)    “Base Pay” means the straight-time earnings or
regular salary paid to an Eligible Employee. Base Pay will not include overtime, bonuses or other items that the committee administering this Plan pursuant to Section 14 of this Plan does not consider to be regular compensation. Payroll
deductions will commence with the first paycheck issued during the Subscription Period and, except as set forth in Sections 9 and 10, will continue with each paycheck throughout the entire Subscription Period, except for pay periods for which the
Eligible Employee receives no compensation (i.e., uncompensated personal leave, leave of absence, etc.). 

Section 8.    Purchase of Shares. 

The Company will maintain a “Plan Account” on its books for recordkeeping purposes only in the name of each Eligible Employee who
authorized a payroll deduction (a “participant”). At the close of each pay period, the Company will credit the amount deducted from the participant’s Base Pay to the participant’s Plan Account. The Company will pay no interest on
any Plan Account balance in any circumstance. As of the last day of each Subscription Period, the Company will divide the amount then in the participant’s Plan Account by the Subscription Price for such Subscription Period as determined
pursuant to Section 6 , and credit the participant’s Plan Account with the number of whole shares that results. The Company will not credit fractional shares under this Plan. The Company will issue and deliver share certificates to each
participant within a reasonable time thereafter. The Company will carry forward any amount remaining in a participant’s Plan Account to the next Subscription Period. However, any amount the Company carries forward pursuant to this
Section 8 will not reduce the amount a participant may contribute pursuant to Section 7 of this Plan during the next Subscription Period. If a participant does not accumulate sufficient funds in his or her Plan Account to purchase at least
ten shares of Class A common stock during a Subscription Period, the Company will deem such participant to have withdrawn from this Plan pursuant to Section 9 of this Plan. 

If the number of shares subscribed for purchase during any Subscription Period exceeds the number of shares available for purchase under this
Plan, the Company will allocate the remaining shares available for purchase among all participants in proportion to their Plan Account balances, exclusive of any amounts carried forward pursuant to the preceding paragraph. If the number of shares
that would be credited to any participant’s Plan Account in either or both of the Subscription Periods occurring during any calendar year exceeds the limit specified in Section 2(c) of this Plan, the Company will credit the
participant’s Plan Account with the maximum number of shares permissible, and refund the remaining amounts to the participant in cash without interest thereon. 

Section 9.    Withdrawal from This Plan. 

A participant, other than a Section 16 officer, may withdraw from this Plan at any time by giving a properly completed and executed
written notice of withdrawal to the Company. As soon as practicable following the Company’s receipt of a notice of withdrawal, the Company will refund the amount credited to the participant’s Plan Account in cash without interest thereon.
The Company will make no further payroll deductions with respect to such participant except in accordance with an authorization for a new payroll deduction filed during a 

  
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subsequent Enrollment Period in accordance with Section 4 of this Plan. A participant’s withdrawal will not affect the participant’s eligibility to participate during any
succeeding Subscription Period. A withdrawal by a Section 16 officer, other than a withdrawal under Section 10 of this Plan, will not become effective until the Subscription Period that commences after the date the Company receives written
notice of such withdrawal. 
 Section 10.    Separation from Employment. 

The Company will treat separation from employment for any reason, including death, disability or retirement, as defined in this
Section 10, as an automatic withdrawal pursuant to Section 9 of this Plan. However, at the election of a participant who retires, or in the event of a participant’s death at the election of the participant’s beneficiary, any cash
balance in such participant’s Plan Account may be used to purchase the appropriate number of whole shares of Class A common stock at a Subscription Price determined in accordance with Section 6 of this Plan using the date of the
participant’s retirement or death as though it was the last day of the Subscription Period. The Company will refund in cash any cash balance in the Plan Account after such purchase to the participant, or in the event of the participant’s
death to the participant’s beneficiary without interest thereon. As used in this Section 10, “retirement” means a termination of employment by reason of a participant’s retirement at or after the participant’s earliest
permissible retirement date pursuant to and in accordance with his or her employer’s regular retirement plan or practice. 

Section 11.    Assignment and Transfer Prohibited. 

No participant may assign, pledge, hypothecate or otherwise dispose of his or her subscription or rights to subscribe under this Plan to any
other person, and any attempted assignment, pledge, hypothecation or disposition will be void. However, a participant may acquire shares of Class A common stock subscribed to under this Plan in the names of the participant and another person
jointly with the right of survivorship upon appropriate written notice to the Company. No subscription or right to subscribe granted to a participant under this Plan will be transferable by the participant otherwise than by will or by the laws of
descent and distribution, and such subscription rights will be exercisable only by the participant during the participant’s lifetime. 

Section 12.    Adjustment of and Changes in Class A Common Stock. 

In the event that the outstanding shares of Class A common stock of the Company are hereafter increased or decreased or changed into or
exchanged for a different number or kind of shares or other securities of the Company, or of another corporation, by reason of reorganization, merger, consolidation, recapitalization, reclassification, stock
split-up, stock dividend, either in shares of Class A common stock or of another class of the Company’s stock, spin-off or combination of shares, the committee
appointed pursuant to Section 14 of this Plan will make appropriate adjustments in the aggregate number and kind of shares that are reserved for sale under this Plan. 

Section 13.    Amendment or Termination of This Plan. 

The Board of Directors of the Company (the “Board”) will have the right to amend, modify or terminate this Plan at any time without
notice, provided that the amendment, modification or termination of this Plan does not adversely affect any participant’s existing rights and provided further that, without the approval of the stockholders of the Company in accordance with
applicable law and regulations, no such amendment will increase the benefits accruing to participants under this Plan, increase the total number of shares subject to this Plan, change the formula by which the price at which the shares will be sold
is determined, or change the class of employees eligible to participate in this Plan. 

Section 14.    Administration. 

A committee of three employees of the Company the Board appoints from time to time will administer this Plan. The committee may from time to
time adopt rules and regulations for carrying out this Plan. Any interpretation or construction of any provision of this Plan by the committee will be final and conclusive on all persons absent contrary action by the Board. Any interpretation or
construction of any provision of this Plan by the Board will be final and conclusive on all persons. 

  
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 Section 15.    Designation of Beneficiary. 

A participant may file a written designation of a beneficiary who is to receive any cash credited to the participant under this Plan in the
event of such participant’s death prior to the delivery to the participant of such cash. A participant may change such designation of a beneficiary at any time upon written notice to the Company. Upon the death of a participant and upon the
committee’s receipt of proof of the participant’s death and of the identity and existence of a beneficiary validly designated by the participant under this Plan, the Company will deliver such cash to such beneficiary. In the event of the
death of a participant and in the absence of a beneficiary validly designated under this Plan who is living at the time of such participant’s death, the Company will deliver such cash to the executor or administrator of the estate of the
participant, or if, to the knowledge of the Company, the participant has not appointed such executor or administrator, the Company, in its sole discretion, may deliver such cash to the spouse or to any one or more dependents or relatives of the
participant, or if no spouse, dependent, or relative is known to the Company, then to such other person as the Company may designate. No designated beneficiary will, prior to the death of the participant by whom the beneficiary has been designated,
acquire any interest in the shares or cash credited to the participant under this Plan. 

Section 16.    Employees’ Rights. 

Nothing contained in this Plan will prevent the Company, Donegal Mutual or any Participating Company from terminating any employee’s
employment. No employee will have any rights as a stockholder of the Company by reason of participation in this Plan unless and until the Company has issued and delivered certificates to the participant representing shares of Class A common
stock for which the participant has subscribed. 
 Section 17.    Use of Funds. 

The Company may use all payroll deductions it receives or holds under this Plan for any corporate purpose, and the Company will not be
obligated to segregate such payroll deductions. Any account established for a participant will be for recordkeeping purposes only. 

Section 18.    Government Regulations. 

The Company’s obligation to sell and deliver Class A common stock under this Plan is subject to any prior approval or compliance that
may be required to be obtained or made from or with any governmental or regulatory authority in connection with the authorization, issuance or sale of such Class A common stock. 

Section 19.    Titles. 

Titles are provided in this Plan for convenience only and are not to serve as a basis for interpretation or construction of this Plan. 

Section 20.    Applicable Law. 

This Plan will be construed, administered and governed in all respects under the laws of the Commonwealth of Pennsylvania and the United States
of America. 

  
 5 

 Section 21.    Compliance with Rule 16b-3. 
 To the extent that Rule 16b-3 under
the Exchange Act applies to purchases made under this Plan, it is the Company’s intent that this Plan comply in all respects with the requirements of Rule 16b-3, that the Company interpret any
ambiguities or inconsistencies in the construction of this Plan to give effect to such intention and that if this Plan will not so comply, whether on the date of adoption or by reason of any later amendment to or interpretation of Rule 16b-3, the provisions of this Plan will be deemed to be automatically amended so as to bring them into full compliance with such rule. 

Section 22.    Approval of Stockholders. 

Prior to June 30, 2011, the Company will submit this Plan to its stockholders for approval in accordance with applicable law and
regulations. Subscriptions for the purchase of shares under this Plan will be subject to the condition that the stockholders of the Company approve this Plan prior to such date in the manner contemplated by Section 423(b)(2) of the Code. If the
Company’s stockholders do not approve this Plan prior to such date, this Plan will terminate, all subscriptions under this Plan will be terminated and be of no further force or effect and the Company shall promptly refund in cash, without
interest, of all sums previously deducted from their compensation pursuant to this Plan. 

  
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