Document:

Amended and Restated Salary Continuation Agreement

 EXHIBIT 10.14 
 APPALACHIAN COMMUNITY BANK 
 SALARY CONTINUATION AGREEMENT 
 [As Amended and Restated to Comply with 
 Section 409A of the Internal Revenue Code] 
 THIS SALARY CONTINUATION AGREEMENT, as amended and restated (the
“Agreement”), is adopted as of the first day of August, 2004, by and among APPALACHIAN COMMUNITY BANK, a state-chartered commercial bank located in Ellijay, Georgia (the “Bank”), APPALACHIAN BANCSHARES, INC., the parent company
of the Bank (the “Holding Company”), and TRACY R. NEWTON (the “Executive”). 
 The purpose of this Agreement is to
provide to the Executive, as a member of a select group which contributes materially to the continued growth, development and future business success of the Bank and the Holding Company, the specified benefits, as well as incentives for continued
employment with the Bank and Holding Company, as set forth herein. 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. The Bank will pay the benefits provided under this Agreement from its general assets. 
 The Bank, the Holding Company and the
Executive, for and in consideration of the above stated contributions of the Executive and other good and valuable consideration, do hereby agree as follows: 
 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 the Discount Rate. Any amortization method, if acceptable under GAAP, may be used to determine the Accrual Balance. However, once chosen, the method must be consistently applied. The
Accrual Balance for each Plan Year shall be reported annually by the Bank to the Executive in the form of Schedule A of this Agreement. 

  

	1.2	“Beneficiary” means each designated person, or the estate of the deceased Executive, entitled to benefits, if any, upon the death of the Executive, and as otherwise
determined pursuant to Article 3 and 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	“Change of Control” means the occurrence of any of the following conditions: 

 (i) Any “Person” [which term, for purposes of this Section 1.4, shall mean an individual (other than the Executive), individuals acting in
concert or as a “group” under the Securities Exchange Act of 1934, or a corporation, partnership, trust or other form of entity, (other than the Holding Company, the Bank, a securities underwriter of the shares of the Holding Company or
the Bank, a corporation owned by stockholders of the Holding Company in the same proportions as their ownership of stock in the Holding Company, or a fiduciary holding securities under an employee benefit plan of the Holding Company or Bank)]
becomes, directly or indirectly, the “beneficial owner” (as defined in Rule 13d-3 under the Securities Exchange Act of 1934) of 

 Appalachian Community Bank 
 Salary Continuation Agreement 
  

 
securities of the Holding Company or Bank which represent twenty-five percent (25%) or more of the voting power of the then outstanding securities of
the Holding Company or Bank; or 
 (ii) Any Person acquires, directly or indirectly, the ability to control the election of a majority of the
directors of either the Bank or the Holding Company; or 
 (iii) Any Person acquires, directly or indirectly, the ability to exercise a
controlling influence over the management of policies of either the Holding Company or the Bank; or 
 (iv) During any period of two
(2) consecutive years, the “Continuing Directors” (which term, for purposes of this Section 1.4, means these individuals who, (a) at the beginning of such two-year period, constitute the board of directors of either the
Holding Company or the Bank or (b) whose election or nomination as directors of the Holding Company or the Bank were approved by a vote of least two-thirds of these previously elected directors) cease for any reason to constitute at least
two-thirds of the board of directors of either the Holding Company or the Bank; or 
 (v) The consummation of a merger or statutory share
exchange of the Holding Company or the Bank with any Person, other than a merger or statutory share exchange which would (a) result in the voting securities of the Holding Company or Bank outstanding immediately prior thereto, continuing to
represent at least seventy-five percent (75%) of the combined voting power of the voting securities of the Holding Company, Bank or such other surviving entity, outstanding immediately after such merger or statutory share exchange, in
substantially the same proportions as their ownership immediately prior to such merger or statutory share exchange, or (b) effect or implement a recapitalization of the Holding Company or Bank (or similar transaction), in which no Person
acquires more than fifty percent (50%) of the combined voting power of the then-outstanding securities of the Holding Company or Bank; or 
 (vi) The shareholders of the Holding Company or Bank approve a plan of complete liquidation of the Holding Company or the Bank, or an agreement for the sale or disposition by the Holding Company or the Bank of all or substantially all of
the assets of the Holding Company or the Bank. 
  

	1.5	“Change of Control Benefit” means the benefit provided to the Executive under Section 2.4 of this Agreement, pursuant to the terms of this Agreement. The
amount of the Change of Control Benefit, as determined under Section 2.4, is an annual amount equal to the projected annual benefit to be paid to the Executive at 65, as set forth in Section 2.1.1, which annual amount shall be paid to the
Executive in equal monthly payments for each of the fifteen (15) consecutive twelve (12) month periods next following the Executive’s Normal Retirement Age, or at such later date as may be required under this Agreement or by
applicable law (including Code Section 409A). 

  

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

  

	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	 “Disability Benefit” means the benefit provided to the Executive under Section 2.3 of this Agreement, 

 Appalachian Community Bank 
 Salary Continuation Agreement 
  

	 	 
pursuant to the terms of this Agreement. The amount of the Disability Benefit, as determined under Section 2.3 is an annual amount equal to the
projected annual benefit to be paid to the Executive at age 65, as set forth in Section 2.1.1, which annual amount shall be paid to the Executive in equal monthly payments for each of the fifteen (15) consecutive twelve (12) month
periods next following the Executive’s Normal Retirement Age. 

  

	1.9	“Discount Rate” means the rate used by the Plan Administrator for determining the Accrual Balance. The initial Discount Rate is seven percent (7%). However, the
Plan Administrator, in its sole discretion, may adjust the Discount Rate to maintain the rate within reasonable standards according to GAAP. 

  

	1.10	“Early Involuntary Termination” means a termination of Executive’s employment, by the Bank or the Holding Company, prior to Executive’s Normal Retirement
Age, for reasons other than death, Disability, a Termination for Cause, or a Termination of Employment following a Change of Control. 

  

	1.11	“Early Involuntary Termination Benefit” means the benefit provided to the Executive pursuant to the provisions of Section 2.6 of this Agreement, and as set
forth in Schedule A of this Agreement, as updated annually pursuant to the terms of this Agreement. The amount of the Early Involuntary Termination Benefit, as determined under Section 2.6 and as set forth in Schedule A, is an
annual amount to be paid to the Executive in equal monthly payments for each of the fifteen (15) consecutive twelve (12) month periods next following the Executive’s Normal Retirement Date, or at such later date as may be required
under this Agreement or by applicable law (including Code Section 409A). 

  

	1.12	“Early Termination” means a termination of the Executive’s employment, with the Bank or the Holding Company, by the Executive, prior to Executive’s Normal
Retirement Age, for reasons other than death, Disability, or a Termination for Good Reason. 

  

	1.13	“Early Termination Benefit” means the benefit provided to the Executive under Section 2.2 of this Agreement, and as set forth in Schedule A of this
Agreement, as updated annually pursuant to the terms of this Agreement. The amount of the Early Termination Benefit, as determined under Section 2.2 and as set forth in Schedule A, is a one-time, lump-sum amount to be paid to the
Executive within thirty (30) days following the Executive’s Early Termination Date, or at such later date as may be required under this Agreement or by applicable law (including Code Section 409A). 

  

	1.14	“Early Termination Date” means the date on which Early Termination occurs. 

  

	1.15	“Effective Date” means June 1, 2004. 

  

	 1.16
	 “Normal Retirement Age” means the earlier of the Executive’s 65th birthday or the date upon which the Executive completes 20 years of employment with the Bank and/or Holding Company. 

  

	1.17	“Normal Retirement Benefit” means the benefit provided to the Executive pursuant to the provisions of Section 2.1 of this Agreement, and as set forth in
Schedule A of this Agreement, as updated annually pursuant to the terms of this Agreement. The amount of the Normal Retirement Benefit, as determined under Section 2.1 and as set forth in Schedule A, is an annual amount to be paid
to the Executive in equal monthly payments for each of the fifteen (15) consecutive twelve (12) month periods next following the Executive’s Normal Retirement Date, or at such later date as may be required under this Agreement or by
applicable law (including Code Section 409A). 

  

	1.18	“Normal Retirement Date” means the date of the Executive’s Termination of Employment, occurring on or after the Executive’s Normal Retirement Age.

  

	1.19	“Plan Administrator” means the plan administrator described in Article 8. 

  

	1.20	“Plan Year” means each twelve-month period commencing on the Effective Date. 

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 Salary Continuation Agreement 
  

	1.21	“Termination for Cause” has that meaning set forth in Article 5. 

  

	1.22	“Termination for Good Reason” means a termination, by the Executive, of the Executive’s employment with the Holding Company and Bank, following the occurrence,
without prior approval of the Executive, of any one of the following events: 

  

	 	(i)	a material reduction in the Executive’s responsibilities, title or authority; 

  

	 	(ii)	a material reduction, without reasonable cause, of the Executive’s salary and other benefits; and 

  

	 	(iii)	a relocation, without consent of the Executive, of the Executive’s principal executive offices of more than fifty (50) miles, or relocation of the Executive outside of
Ellijay (or, if applicable, outside of place of relocated principal executive offices). 

  

	1.23	“Termination for Good Reason Benefit” means the benefit provided to the Executive pursuant to the provisions of Section 2.7 of this Agreement, and as set forth
in Schedule A of this Agreement, as updated annually pursuant to the terms of this Agreement. The amount of the “Termination for Good Reason Benefit”, as determined under Section 2.7 and as set forth in Schedule A, is an
annual amount to be paid to the Executive in equal monthly payments for each of the fifteen (15) consecutive twelve (12) month periods next following the Executive’s Normal Retirement Date, or at such later date as may be required
under this Agreement or by applicable law (including Code Section 409A). 

  

	1.24	“Termination of Employment” means termination of the Executive’s employment with the Bank or Holding Company, for reasons other than death. Whether a
Termination of Employment has occurred shall be determined in accordance with the requirements of Code Section 409A, based on the applicable facts and circumstances required to be considered thereunder. 

 Article 2 
 Benefits During Lifetime

  

	2.1	Normal Retirement Benefit. The benefit payable to the Executive under this Section 2.1 is the Normal Retirement Benefit, an annual benefit set forth in Schedule A
of this Agreement (as updated annually) for the Plan Year during which the Executive’s Normal Retirement Date occurs. Upon the Executive’s Normal Retirement Date, the Bank shall pay to the Executive the Normal Retirement Benefit, as
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 for the first Plan Year is One Hundred Sixty-Eight Thousand Nine Hundred Nine Dollars ($168,909). Commencing
on the first day of the second Plan Year, and on the first day of each Plan Year thereafter, the annual benefit shall be increased three percent (3%) from the previous Plan Year, until, and including, the Plan Year in which the Executive’s
Normal Retirement Date occurs. The Executive’s projected annual benefit, as of the first day of the Plan Year occurring in the calendar year during which the Executive reaches age 65, is Two Hundred Seventy-Nine Thousand One Hundred and
Eighty-One Dollars ($279,181). 

  

	 	2.1.2	Payment of Benefit. The Bank shall pay the Normal Retirement Benefit to the Executive in equal monthly installments, commencing on the first day of the month following the
Executive’s Normal Retirement Date, or at such later date as may otherwise be required by this Agreement or by applicable law (including Code Section 409A). This annual benefit shall be paid to the Executive for each of the fifteen
(15) consecutive twelve (12) month periods next following the Executive’s Normal Retirement Date, for a total of 180 consecutive equal monthly payments. 

  

	2.2	Early Termination Benefit. Upon the Executive’s Early Termination, the Bank shall pay to the Executive the Early Termination Benefit, as described in this
Section 2.2, in lieu of any other benefit under this Article. 

 Appalachian Community Bank 
 Salary Continuation Agreement 
  

	 	2.2.1	Amount of Benefit. The benefit payable to the Executive under this Section 2.2 is the Early Termination Benefit, a one-time, lump-sum amount set forth on Schedule
A of the Agreement (as updated annually) for the Plan Year during which the Executive’s Early Termination Date occurs. The amount of the Early Termination Benefit payable to the Executive in any Plan Year shall be equal to the
Executive’s Accrual Balance accrued under this Agreement for all Plan Years. 

  

	 	2.2.2	Payment of Benefit. The Bank shall pay the Early Termination Benefit to the Executive, as a one-time, lump-sum amount, within thirty (30) days following the
Executive’s Early Termination Date, or at such later date as may otherwise be required by this Agreement or by applicable law (including Code Section 409A). 

  

	2.3	Disability Benefit. Upon the Executive’s Termination of Employment due to Disability prior to Normal Retirement Age, the Bank shall pay 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 benefit payable to the Executive under this Section 2.3 is the Disability Benefit, an annual benefit in an amount equal to the projected
annual benefit to be paid to the Executive at age 65, as set forth in Section 2.1.1 of this Agreement. 

  

	 	2.3.2	Payment of Benefit. The Bank shall pay the Disability Benefit to the Executive in equal monthly installments, commencing with the month following the Executive’s Normal
Retirement Age, or at such later date as may otherwise be required by this Agreement or by applicable law (including Code Section 409A). This annual benefit shall be paid to the Executive for each of the fifteen (15) consecutive twelve
(12) month periods next following the Executive’s Normal Retirement Age, for a total of 180 consecutive equal monthly payments. 

  

	2.4	Change of Control Benefit. Upon a Change of Control followed by the Executive’s Termination of Employment (other than a Termination for Cause), the Bank shall pay to the
Executive the Change of Control Benefit, as described in this Section 2.4, in lieu of any other benefit under this Article. 

  

	 	2.4.1	Amount of Benefit. The benefit payable to the Executive under this Section 2.4 is an annual benefit in an amount equal to the projected annual benefit to be paid
to the Executive at age 65, as set forth in Section 2.1.1 of this Agreement. 

  

	 	2.4.2	Payment of Benefit. The Bank shall pay the Change of Control Benefit to the Executive in equal monthly installments commencing with the month following the Executive’s
Normal Retirement Age, or at such later date as may otherwise be required by this Agreement or by applicable law (including Code Section 409A). This annual benefit shall be paid to the Executive for each of the next fifteen
(15) consecutive years next following the Executive’s Normal Retirement Age, for a total of 180 consecutive equal monthly payments. 

  

	2.5	Failure to be Nominated or Reelected. Upon the failure of the Executive to be nominated or reelected as a director of either of the Bank or the Holding Company (for any
reason other than for a Termination for Cause), the Bank shall pay to the Executive the benefit described in this Section 2.5. 

  

	 	2.5.1	Amount of Benefit. The benefit payable to the Executive under this Section 2.5 is an annual benefit in an amount equal to the projected annual benefit to be paid to the
Executive at age 65, as set forth in Section 2.1.1 of this Agreement. 

  

	 	2.5.2.	Payment of Benefit. The benefit payable under this Section 2.5 shall be paid to the Executive in equal monthly installments, commencing with the month following the
Executive’s Normal Retirement Age, or at such later date as may otherwise be required by this Agreement or by applicable law (including Code Section 409A). This annual benefit shall be paid to the Executive for each of the fifteen
(15) consecutive years next following the Executive’s Normal Retirement Age, for a total of 180 consecutive equal monthly payments. 

 Appalachian Community Bank 
 Salary Continuation Agreement 
  

	2.6	Early Involuntary Termination Benefit. Upon the Executive’s Involuntary Early Termination, the Bank shall pay to the Executive the Involuntary Early Termination Benefit,
as described in this Section 2.6, in lieu of any other benefit under this Article. 

  

	 	2.6.1	Amount of Benefit. The benefit payable to the Executive under this Section 2.6 is an annual benefit equal to the Normal Retirement Benefit, computed through the Plan
Year during which such Early Involuntary Termination occurred, to be paid to the Executive at the Executive’s Normal Retirement Age, as set forth in Schedule A (as updated annually) pursuant to the provisions of Section 2.1.1 of
this Agreement. 

  

	 	2.6.2	Payment of Benefit. The Bank shall pay the Early Involuntary Termination Benefit to the Executive in twelve (12) equal monthly installments, commencing with the month
following the Executive’s Normal Retirement Age, or at such later date as may otherwise be required by this Agreement or by applicable law (including Code Section 409A). This annual benefit shall be paid to the Executive for each of the
fifteen (15) years, for a total of 180 consecutive equal monthly payments. 

  

	2.7	Termination for Good Reason Benefit. Upon the Executive’s Termination for Good Reason, the Bank shall pay to the Executive the Termination for Good Reason Benefit, as
described in this Section 2.7, in lieu of any other benefit under this Article. 

  

	 	2.7.1	Amount of Benefit. The benefit payable to the Executive under this Section 2.6 is an annual benefit equal to the Normal Retirement Benefit, computed through the Plan
Year in which such Termination for Good Reason occurred, to be paid to the Executive at the Executive’s Normal Retirement Age, as set forth in Schedule A (as updated annually) pursuant to the provisions of Section 2.1.1 of this
Agreement. 

  

	 	2.7.2	Payment of Benefit. The Bank shall pay the Termination for Good Reason Benefit to the Executive in twelve (12) equal monthly installments, commencing with the month
following the Executive’s Normal Retirement Age, or at such later date as may be required under this Agreement or by applicable law (including Code Section 409A). This annual benefit shall be paid to the Executive for fifteen
(15) years, for a total of 180 consecutive equal monthly payments. 

  

	2.8	Restriction on Commencement of Distributions. Notwithstanding any provision of this Agreement to the contrary, if the Executive is considered a “specified
employee”, within the meaning of Code Section 409A, the provisions of this Section 2.8 shall govern all distributions hereunder. If benefit distributions which would otherwise be made to the Executive due to Termination of Employment
are limited because the Executive is a “specified employee”, then such distributions shall not be made during the first six (6) months following Termination of Employment. 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 Termination of Employment. All subsequent distributions shall be paid in the manner specified.

  

	2.9	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. 

  

	2.10	Change in Form or Timing of Distributions. For distribution of benefits under this Article 2, the Executive, the Holding Company and the Bank may, subject to the terms
of Section 7.1, amend this Agreement to delay the timing, or to change the form, of such distributions; provided however, that any such amendment (including the implementation of such amendment), and any delay in the timing, or change in the
form, of such distributions thereunder, shall conform in all respects to the requirements of Code Section 409A. 

 Appalachian Community Bank 
 Salary Continuation Agreement 
  

 Article 3 
 Death Benefits 
  

	3.1	Death During Active Employment. If the Executive dies while in the active employment of the Bank and the Holding Company, the Bank shall pay to the Beneficiary the benefit
described in this Section 3.1. This benefit shall be paid in lieu of the benefits under Article 2. 

  

	 	3.1.1	Amount of Benefit. The benefit under this Section 3.1 is the Pre-Retirement Death Benefit, an annual benefit in an amount equal to the projected annual benefit to be
paid to the Executive at the Executive’s Normal Retirement Age, as set forth in Section 2.1.1 of this Agreement. 

  

	 	3.1.2	Payment of Benefit. The Bank shall pay the Pre-Retirement Death Benefit, to the Beneficiary in equal monthly installments, commencing with the month following the
Executive’s death. The Pre-Retirement Death Benefit shall be paid to the Beneficiary (as provided under this Article 3 and Article 4) for a period of fifteen (15) consecutive twelve (12) month periods next following the death of the
Executive, for a total of 180 consecutive equal monthly payments. 

  

	3.2	Death During Payment of a Benefit. If the Executive dies after any benefit payments have commenced under Article 2 of this Agreement, but before receiving all such payments,
the Bank shall pay the remaining benefits to the Beneficiary at the same time and in the same amounts that would have been paid to the Executive had the Executive survived. 

  

	3.3	Death After Termination of Employment But Before Payment of a Benefit Commences. If the Executive is entitled to any benefit payments under Article 2 of this
Agreement, but dies prior to the commencement of said benefit payments, the Bank shall pay the same benefit payments to the Beneficiary that the Executive was entitled to prior to death, except that the benefit payments shall commence on the first
day of the month following the date of the Executive’s death. 

  

	3.4	Death of a Beneficiary prior to Full Payment of Benefit. If a Beneficiary dies prior to receipt of the full benefits to be paid to the Beneficiary under this Agreement, the
remaining benefit payments, otherwise payable to the Beneficiary under the terms of this Agreement, shall be paid to the personal representative of the estate of the Beneficiary. The personal representative of the estate of the Beneficiary, and any
beneficiary to whom such benefits are paid by or from the Beneficiary’s estate, shall each be a “Beneficiary” for purposes of this Agreement. 

 Article 4 
 Beneficiaries 
  

	4.1	Beneficiary Designation. The Executive shall have the right, at any time, to designate a Beneficiary(ies) to receive any benefits payable 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 designation under any other benefit plan of the Bank in which the Executive participates. 

  

	4.2	Beneficiary Designation: Change. 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. 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, as in effect from time to
time. 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. 

  

	4.3	 Acknowledgment. Except as otherwise specifically provided in this Agreement, no designation or change in designation of a Beneficiary shall be effective
until received, accepted and acknowledged in writing by 

 Appalachian Community Bank 
 Salary Continuation Agreement 
  

	 	 
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, if married to Executive at the date of Executive’s death, shall be the designated Beneficiary. If the Executive has no spouse at the Executive’s date of death, the benefits shall be made to the personal
representative of the Executive’s estate. The personal representative of the Executive’s estate and any beneficiary to whom such benefits are paid by or from the Executive’s estate, shall each be a “Beneficiary” for purposes
of this Agreement. 

  

	4.5	Facility of Payment. If the Plan Administrator determines in its discretion that a benefit is to be paid 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 payment 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 payment of a benefit shall be a payment for the account of the Executive and the
Executive’s Beneficiary, as the case may be, and shall be a complete discharge of any liability under the Agreement for such payment amount. 

 Article 5 
 General Limitations 
  

	5.1	Termination for Cause. Notwithstanding any provision of this Agreement to the contrary, the Bank shall not pay any benefit under this Agreement if the board of directors or
shareholders of either the Bank or the Holding company terminates the Executive’s employment for: 

  

	 	(a)	Gross negligence or gross neglect of duties to the Bank; 

  

	 	(b)	Commission of a felony or of a gross misdemeanor involving moral turpitude; 

  

	 	(c)	Fraud 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;
or 

  

	 	(d)	Issuance of an order for removal of the Executive by the banking regulators of the Bank or the Holding Company. 

  

	5.2	Suicide or Misstatement. The Bank shall not pay any benefit under this Agreement if the Executive commits suicide within two years after the Effective Date. In addition, the
Bank shall not pay any benefit under this Agreement if the Executive has made any material misstatement of fact on any application for life insurance owned by the Bank on the Executive’s life. 

  

	5.3	Competition After Termination of Employment. The Bank shall not pay any benefit under this Agreement if the Executive, without the prior written consent of the Bank or, if
earlier, within 1 year from the Executive’s Termination of Employment, engages in, directly or indirectly, as a sole proprietor, as a partner in a partnership, or as a holder of more than five percent (5%) of the voting shares in a
corporation, or becomes associated with, in the capacity of employee, director, officer, principal, agent or trustee, any enterprise conducted within a 25-mile radius of any office of the Bank existing at the time of the Executive’s Termination
of Employment, which enterprise is, or may deemed to be, competitive with the business of banking carried on by the Bank as of the date of the Executive’s Termination of Employment. This section shall not apply to a Termination of
Employment (other than a Termination for Cause) following a Change of Control or to an Early Involuntary Termination. 

 Appalachian Community Bank 
 Salary Continuation Agreement 
  

 Article 6 
 Claims And Review Procedures 
  

	6.1	Claims Procedure. An Executive or Beneficiary (“claimant”) who has not received benefits under the Agreement that he or she believes should be paid shall make a
claim for such benefits as follows: 

  

	 	6.1.1	Initiation – Written Claim. The claimant initiates a claim by submitting to the Plan Administrator a written claim for the benefits. 

  

	 	6.1.2	Timing of Plan Administrator Response. The Plan Administrator shall respond to such claimant within 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 90 days by notifying the claimant in writing, prior to the end of the initial 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. 

  

	 	6.1.3	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 include: 

  

	 	(a)	The specific reasons for the denial; 

  

	 	(b)	A reference to the specific provisions of the 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; and 

  

	 	(d)	A description of the applicable review procedures and the time limits applicable to such procedures. 

  

	6.2	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: 

  

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

  

	 	6.2.2	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 to the claimant’s claim for benefits.

  

	 	6.2.3	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. 

  

	 	6.2.4	Timing of Plan Administrator Response. The Plan Administrator shall respond in writing to such claimant within 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 60 days by notifying the claimant in writing, prior to the end of the
initial 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. 

  

	 	6.2.5	 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 

 Appalachian Community Bank 
 Salary Continuation Agreement 
  

	 	 
understood by the claimant. The notification shall include: 

  

	 	(a)	The specific reasons for the denial; 

  

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

  

	 	(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 to
the claimant’s claim for benefits. 

 Article 7 
 Amendments and Termination 
  

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

  

	7.2	Plan Termination Generally; Code Section 409A This Agreement may be terminated only by a written agreement signed by the Bank, Holding Company and the Executive. The
benefit shall be the Accrual Balance, as of the date of the agreement of termination, or as otherwise provided in the agreement of termination; provided, however, that the amount, the form, and the timing, of any distribution to be made
thereunder shall comply, in all respects, with the provisions of Section 409A of the Code. 

 Article 8 

Administration of Agreement 
  

	8.1	Plan Administrator Duties. This Agreement shall be administered by a Plan Administrator which shall consist of the Board, or such committee or person(s) as the Board shall
appoint. The Executive may be a member of the Plan Administrator. The Plan Administrator shall also have the discretion and authority to (i) make, amend, interpret and enforce all appropriate rules and regulations for the administration of this
Agreement and (ii) decide or resolve any and all questions including interpretations of this Agreement, as may arise in connection with the Agreement. 

  

	8.2	Agents. In the administration of this Agreement, the Plan Administrator may employ agents and delegate to them such administrative duties as it 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. 

  

	8.3	Binding Effect of Decisions. The decision or action of the Plan Administrator with respect to any question arising out of or in connection with the administration,
interpretation and application of the Agreement and the rules and regulations promulgated hereunder shall be final and conclusive and binding upon all persons having any interest in the Agreement. No Executive or Beneficiary shall be deemed to have
any right, vested or nonvested, regarding the continued use of any previously adopted assumptions, including but not limited to the Discount Rate. 

  

	8.4	Indemnity of Plan Administrator. The Bank shall indemnify and hold harmless the members of 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 or any of its members. 

  

	8.5	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 circumstances of the retirement, Disability, death, or Termination of Employment of the Executive, and such other pertinent information as the Plan Administrator may reasonably require. 

  

	8.6	 Annual Statement. The Plan Administrator shall provide to the Executive, within 120 days after the end of each Plan Year, in the form of Schedule A of
this Agreement, a statement setting forth the benefits payable 

 Appalachian Community Bank 
 Salary Continuation Agreement 
  

	 	 
under this Agreement. It is hereby agreed that such annual statement, in the form of Schedule A, shall be incorporated into, and thereby shall be a
part of, this Agreement. 

 Article 9 
 Miscellaneous 
  

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

  

	9.2	No Guarantee of Employment. This Agreement is not a policy or contract regarding the continued employment of the Executive, as a director of the Bank and/or the Holding
Company. It does not give the Executive the right to remain as an employee or director of the Bank or the Holding Company, nor does it interfere with the right of the Bank or the Holding Company, or their respective shareholders, to remove the
Executive from office. It also does not require the Executive to remain a director of the Bank or Holding Company nor interfere with the Executive’s right to terminate employment with the Bank or Holding Company at any time.

  

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

  

	9.4	Tax Withholding. The Bank shall withhold any taxes that, in its reasonable judgment, are required to be withheld 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 authority(ies). 

  

	9.5	Applicable Law. The Agreement and all rights hereunder shall be governed by the laws of the State of Georgia, except to the extent preempted by the laws of the United States
of America. Further, the parties intend for this Agreement, including the payment of benefits hereunder, to comply with the provisions of Section 409A of the Internal Revenue Code of 1986, as said Section may be amended from time to time, and,
therefore, hereby agree that the provisions of this Agreement and the benefits payable hereunder shall be, and hereby are, modified, but only to the extent necessary, to achieve compliance therewith. 

  

	9.6	Unfunded Arrangement. The Executive and Beneficiary (and any other parties with rights under this Agreement) are general unsecured creditors of the Bank for the payment of
benefits under this Agreement. The benefits represent the mere promise by the Bank to pay 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 is a general asset of the Bank to which the Executive and Beneficiary have no preferred or secured claim. 

  

	9.7	Merger or Reorganization. Neither the Bank nor the Holding Company shall merge or consolidate with, or reorganize into, another company or bank, or be sold to, or sell
substantially all of its assets to, another company or bank, firm, or person, unless such succeeding or continuing company, bank, firm, or person agrees to assume and discharge the obligations of the Bank and Holding Company under this Agreement.
Upon the occurrence of such event, the terms “Bank” and “Holding Company”, as used in this Agreement, shall also be deemed to refer to the successor or survivor company or bank. 

  

	9.8	Entire Agreement. This Agreement constitutes the entire agreement between and among the Bank, the Holding Company 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. 

 Appalachian Community Bank 
 Salary Continuation Agreement 
  

	9.10	Alternative Action. In the event it shall become impossible for the Bank, the Holding Company or the Plan Administrator to perform any act required by this Agreement, the
Bank, the Holding Company or Plan Administrator may in its discretion 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. 

  

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

  

	9.12	Validity. In case 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 and invalid provision has never been inserted herein. 

  

	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: 

  

					
		 	Appalachian Community Bank	 	
		 	829 Industrial Blvd.	 	
		 	Ellijay, Georgia 30540	 	

 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	409A Gross-Up. If it is determined that any benefit provided under this Agreement would be subject to accelerated income taxation under Section 409A of the Code, or to
related penalties (the present value of such income tax acceleration (based on the time value of money), together with any such penalties, being collectively referred to herein s as the “excise tax”), then the Executive shall be entitled
to receive any additional payment, determined by the Bank’s outside accounting firm, equal to such excise tax, including any excise tax on such additional payments. Payments under this Section 9.14 shall be due not later than thirty
(30) days following the date the Executive’s tax liability becomes due, or as soon as administratively practicable thereafter. 

 IN WITNESS WHEREOF, the Executive and a duly authorized representative of each of the Bank and
Holding Company have signed this Agreement on this 27th day of March, 2008. 
  

	
	“EXECUTIVE:”
	
	 /s/ Tracy R. Newton

	 Tracy R. Newton,
 President and Chief Executive Officer

  

			
	“BANK:”
	
	Appalachian Community Bank
		
	By:	 	/s/ J. Keith Hales
		
	Title:	 	Chief Operating Officer

			
	“HOLDING COMPANY:”
	
	Appalachian Bancshares, Inc.
		
	By:	 	/s/ J. Keith Hales
		
	Title:	 	Chief Operating Officer

 Appalachian Community Bank 
 Salary Continuation Agreement 
 BENEFICIARY DESIGNATION FORM 
  

 I designate the following as beneficiary of benefits under the Agreement payable following my death: 
  

			
	 Primary:
	  	 
		
	 	  	 
		
	 Contingent:
	  	 
		
	 	  	 

 Note: To name a trust as beneficiary, please provide the name of the trustee(s) and the exact name and
date of the trust agreement. 
 I understand that I may change these beneficiary designations by delivering a new written designation to the Plan
Administrator. I further understand that the designations will be automatically revoked if the beneficiary predeceases me, or, if I have named my spouse as beneficiary and our marriage is subsequently dissolved. 
  

							
	Name:	  	 	  		  	
				
	Signature:	  	 	  	Date:_________	  	

  

							
	 SPOUSAL CONSENT (Required if Spouse not named beneficiary):
  
 I consent
to the beneficiary designation above, and acknowledge that if I am named beneficiary and our marriage is subsequently
dissolved, the designation will be automatically revoked.

	 			 
	Spouse Name:	 	  	 	 	 	  
	 			 
	Signature:	 	  	 	Date:    __________	 	  
	  	 	  	 	  	 	  

 Received by the Plan Administrator this
             day of                         ,
20        . 
  

			
		
	By:	 	 
		
	Title:	 	 

  

									
	 Executive Name
	  	 	  		  	Plan Anniversary Date	  	06/01
	 Normal Retirement Age

	  	*	  		  	Normal Retirement Date (Estimated)	  	06/02/2021

 Appalachian Community Bank 
 Salary Continuation Agreement 
  

									
	 Discount Rate
	  	 Plan Year Ending
	  	Accrual Balance	  	**
Normal Retirement 
Benefit
(annual benefit
amount)	  	Early Termination
Benefit
(one-time, lump-sum
benefit
amount)
					
	7%	  		  	$	  	$	  	$
	 ***
 Disability Benefit
 (annual benefit amount)
	  	 ***
 Change of Control Benefit
 (annual benefit amount)
	  	***
Pre-retirement Death
Benefit
(annual benefit amount)	  	**
Termination for Good
Reason Benefit (annual
benefit
amount)	  	**
Early Involuntary
Termination Benefit
(annual benefit
amount)
	$279,181	  	$279,181	  	$279,181	  	$	  	$

 The parties to this Salary Continuation Agreement hereby further agree that this Schedule A shall be
updated annually to include any changes in the Accrual Balance and the various benefit levels described hereon. Further, this Schedule A, as it now exists and as it may be further updated, is and shall continue to be, a part of this Salary
Continuation Agreement. 
  

	*	The earlier of Age 65 or the date on which the Executive completes 20 years of employment as an employee of the Bank and/or the Holding Company. 

  

	**	The annual benefit amount to be entered here for the Executive is the annual benefit amount set forth in Section 2.1.1 of the Agreement, as increased by 3% on each
anniversary of the Effective Date. 

  

	***	The annual benefit amount to be entered here for the Executive is the projected annual benefit amount set forth in Section 2.1.1 of the Agreement.FHLB of Seattle Executive Supplemental Retirement Plan

 Exhibit 10.17 
  
 FEDERAL HOME LOAN BANK OF SEATTLE 
  

EXECUTIVE SUPPLEMENTAL RETIREMENT PLAN 
  
 Effective as of 
 January 1, 2007

 EXECUTIVE SUPPLEMENTAL RETIREMENT PLAN 
  
 INTRODUCTION 
  
 This Executive Supplemental Retirement Plan has been authorized by the Board of Directors of
the Federal Home Loan Bank of Seattle (the “Employer”) solely for the purpose of providing benefits to those employees of the Employer on or after January 1, 2007 who are designated by the Board of Directors of the Employer as
eligible Members from a select group of highly-compensated or management employees and who are not eligible to participate in the Pentegra Defined Benefit Plan for Financial Institutions (the “Pentegra Plan”) because they were hired by the
Employer on or after January 1, 2004 and they never participated in the Pentegra Plan as sponsored by any employer. The benefits payable to such employees will be the benefits that would have been payable under the Pentegra Plan that is in
effect during the 2006 Plan Year, if such employees had been eligible to participate in that 2006 Pentegra Plan without regard to the limitations placed on Pentegra Plan benefits for such employees by Sections 401(a)(17) and 415 of the Internal
Revenue Code, except as otherwise provided in this Plan. 
  
 Notwithstanding the
foregoing, the 2006 Pentegra Plan benefit formula used to determine an eligible employee’s benefits under this Plan may later be amended by the Board to freeze the Member’s accrued benefit under this Plan or to change the benefit formula
prospectively, and to change the definition of actuarial equivalence for purposes of determining actuarial equivalent benefits, and such benefit shall be designed to meet the requirements of Code Section 409A and applicable regulations so that
payment of a Member’s vested Plan benefits will begin from the Plan upon the earliest of an eligible Member’s termination of employment, retirement, or death and so that one of the permitted forms of payment will be elected by the eligible
Member at the time he or she becomes an eligible Member or by December 31, 2007, whichever is later, with subsequent form of payment election changes subject to the rules of Code Section 409A and applicable regulations, as provided in this
Plan. 
  
 This Plan is intended to provide such benefits solely from the general
assets of the Employer and/or a grantor trust established by the Employer to pay such benefits. No benefits under this Plan shall be payable from the assets of the Pentegra Plan. 
  

 1 

 Article 1. Definitions 
  
 When used in the Plan, the following terms shall have the following meanings: 
  
 1.01 “Actuary” means the independent consulting actuary retained by the Employer to assist the Committee in
its administration of the Plan. 
  
 1.02
“Employer” means the Federal Home Loan Bank of Seattle. 
  
 1.03 “Beneficiary” means the beneficiary or beneficiaries designated in accordance with Article 5 of the Plan to receive the benefit, if any, payable upon the death of a Member of the Plan. 
  
 1.04 “Board of Directors” means the Board of Directors of
the Employer. 
  
 1.05 “Committee” means the
Committee appointed by the Board of Directors to administer the Plan. 
  
 1.06 “Effective Date” means January 1, 2007. 
  
 1.07 “Code” means the Internal Revenue Code of 1986, as amended from time to time, or any successor thereto. 
  
 1.08 “Member” means an employee of the Employer on or after January 1, 2007, who is designated by the Board of Directors as an
eligible Member from a select group of highly-compensated or management employees, and who is not eligible to participate in the Pentegra Plan because he or she (1) was hired as an employee of the Employer on or after January 1, 2004, and
(2) never participated in the Pentegra Plan as sponsored by any employer. 
  
 1.09 “Pentegra Plan” means the Pentegra Defined Benefit Plan for Financial Institution that is in effect during the 2006 Plan Year, which is attached hereto as “Exhibit A.” 

 
 1.10 “Plan” means this Federal Home Loan Bank of Seattle
Executive Supplemental Retirement Plan. 
  
 1.11 “Plan
Year” means the calendar year. 
  

 2 

 Article 2. Membership 
  
 2.01 Each employee of the Employer who meets the requirements of the definition of Member under Section 1.08
shall be enrolled as a Member of the Plan on the later of January 1, 2007 or the date he or she meets the requirements of the definition of Member under Section 1.08. 
  
 2.02 If the Member thereafter no longer meets the requirements of the definition of Member under Section 1.08,
his or her membership in the Plan shall terminate on such date. 
  
 2.03 A Member’s vested Plan benefit shall be payable under the Plan only upon the Member’s retirement, death or other termination of employment with the Employer. 
  

 3 

 Article 3. Amount and Payment of Benefits 
  
 3.01 The amount, if any, of the annual benefit payable to or on
account of a Member pursuant to the Plan shall equal the annual benefit (as calculated by the Plan Actuary on the basis of the form of payment elected by the Member under Section 3.03 below) that would otherwise be payable to or on account of
the Member under the Pentegra Plan in effect for the 2006 Plan Year, as amended pursuant to Article 7 of this Plan, if applicable, if the Member had been eligible to participate in that Pentegra Plan and if that Pentegra Plan was administered
without regard to the limitations imposed by Sections 401(a)(17) and 415 of the Code, and on the basis of salary unreduced by elective contributions under the Employer’s Thrift Plan Benefit Equalization Plan. 
  
 For the purposes of this Section 3.01, “annual benefit” includes any
“Active Service Death Benefit”, “Retirement Adjustment Payment”, “Annual Increment” and “Single Purchase Fixed Percentage Adjustment” which the Employer elected to provide its employees under the 2006 Pentegra
Plan. 
  
 For purposes of this Section 3.01, the annual benefit is calculated
on the basis of the definition of Salary included in the 2006 Pentegra Plan, which determines Salary before any salary reduction contributions to the Employer’s 401(k) Plan, to the Employer’s Internal Revenue Code Section 125 flexible
benefits plan, and to the Employer’s Internal Revenue Code Section 132(f) qualified transportation fringe benefits plan. 
  
 Benefit Service and Membership Service in determining the amount of a Member’s Plan benefit is the number of years and months of service from the Member’s
Enrollment Date to retirement, death, or other termination of employment, as provided in Article III, Section 1, of the 2006 Pentegra Plan. In determining that Benefit Service and Membership Service, the Member’s Enrollment Date is the
date the Member would have been enrolled in the Pentegra Plan if he or she had been eligible to participate in that plan, which date is the first day of the month after the Member completed three months of service with the Employer and attained age
21. Provided, however, that to receive such Benefit Service and Membership Service, the Member must complete 1000 Hours of Service with the Employer in the 12-consecutive-month period commencing on his or her Enrollment Date as defined in the
preceding sentence, and must complete 1000 Hours of Service in each calendar year commencing after such Enrollment Date for Benefit Service and Membership Service to accrue for that 12-consecutive-month period and for each calendar year thereafter,
as provided in Article X, Section 3, of the 2006 Pentegra Plan. 
  
 Vesting
Service is the Member’s period of employment with the Employer measured from the first day of the month in which the Member is hired by the Employer to the last day of the month in which the Member terminates employment with the Employer,
subject to the terms of the 2006 Pentegra Plan. 
  
 3.02
Unless the Member elects a form of payment under the Plan pursuant to Section 3.03 below, the annual benefit, if any, payable to or on account of the Member under Section 3.01 above, shall be converted by the Actuary and shall be payable
to or on account of the Member in the “Regular Form” of payment, utilizing for that purpose the same actuarial factors and assumptions used by the 2006 Pentegra Plan to determine actuarial equivalence 

  

 4 

 
unless the Board amends this Plan to change the definition of actuarial equivalence for purposes of determining actuarial equivalent benefits under this
Plan. For purposes of the Plan, the “Regular Form” of payment means an annual benefit payable for the Member’s lifetime and the death benefit described in Section 3.04 below. 
  
 3.03 (a) Within 30 days after an employee becomes a Member in this
Plan or by December 31, 2007, whichever is later, a Member must make an initial written election of the form of payment in which his or her vested Plan benefits will be distributed. If no initial election is made by the later of such dates, the
Member’s initial election of his or her form of payment shall be deemed to be the Regular Form of Payment under the Plan, which is an annual single life annuity for the Member’s life plus the death benefit described in Section 3.04 of
the Plan (a lump sum payment to the Member’s beneficiary equal to 12 times the annual benefit less the amount of the payments the Member has already received under the Plan prior to his or her death.) The Member’s initial written election
of the form of payment of his or her Plan benefits shall be one of the following forms of payment, notwithstanding any language in the 2006 Pentegra Plan to the contrary: 
  

 i. Regular Form of Payment - Single Life Annuity Plus Death Benefit. A Member who elects the Regular Form of Payment
will receive his or her vested Plan benefit in the form of a single life annuity for the Member’s lifetime plus the death benefit described in Section 3.04 of the Plan (a lump sum payment to the Member’s beneficiary equal to 12 times
the Member’s annual benefit less the amount of the payments the Member already had received under the Plan prior to the Member’s death). 
  
 ii. Lump Sum Payment - A Member who elects a lump sum payment will receive his or her vested Plan benefits in the form of a lump
sum payment if the Member is at least age 45 at the time of retirement or termination of employment with the Employer. Such payment will be made within 60 days after the Member’s retirement or termination of employment, less applicable tax
withholding. After this lump sum payment is made, no further Plan benefits are payable to the Member or to any beneficiary. If the Member who has elected a lump sum payment is not at least age 45 at the time of retirement or termination of
employment, his or her vested Plan benefits will be paid in the Regular Form of Payment under Section 3.02. 
  
 iii. Single Life Annuity With No Death Benefit - A Member who elects a single life annuity with no death benefit will receive his
or her vested Plan benefits in the form of a single life annuity for the Member’s lifetime, with all Plan payments ending at the Member’s death, and with no death benefit to any beneficiary. 
  
 iv. Joint and 100% Survivor Annuity with 120 Months
Certain - A Member who elects a joint and 100% survivor annuity with 120 months certain will receive his or her vested Plan benefits in the form of a joint and 100% survivor annuity for the Member’s life that would continue after the
Member’s death at the rate of 100% to the Member’s joint annuitant if he or she survives the Member. If they both die before 120 monthly installment payments have been paid, the commuted value of those unpaid installments will be paid to
the Member’s beneficiary. 
  

 5 

 v. Joint and 50% Survivor Annuity - A Member who elects a joint and 50% survivor
annuity will receive his or her vested Plan benefits in the form of a joint and 50% survivor annuity for the Member’s life that would continue after the Member’s death to the Member’s joint annuitant, if he or she survives the Member,
at the rate of 50% of the amount payable during the life of the Member. 
  
 vi. Partial Lump Sum/Partial Life Annuity - A Member who elects a partial lump sum/partial life annuity will receive his or her vested Plan benefits in the form of a partial lump sum payment equal to 20%, 50%
or 75% of the Member’s vested Plan benefits as elected by the Member, and a single life annuity for the Member’s lifetime for the remainder of the Member’s vested Plan benefits, if the Member has attained age 45 at the time of
retirement or termination of employment with the Employer. After the Member’s death, no further Plan benefits are payable to the Member or to any beneficiary. If a Member elects a partial lump sum/partial life annuity and is not age 45 at the
time of retirement or termination of employment, his or her vested Plan benefits will be paid in the Regular Form of Payment under Section 3.02. 
  
 3.03 (b) Each form of payment under Section 3.03 (a) will have the same actuarial equivalent values, as determined by the Plan
Actuary utilizing for that purpose the same actuarial factors and assumptions used by the 2006 Pentegra Plan to determine actuarial equivalence, unless the Board amends this Plan to change the definition of actuarial equivalence for purposes of
determining actuarial equivalent benefits under this Plan. 
  
 3.03 (c) A Member’s initial written election of the form of payment of his or her vested Plan benefits may be changed in the future (i) if the Member’s make that written election to change the form of payment at
least 12 months prior to the date of the Member’s retirement or termination of employment, and (ii) as long as the distribution date for commencement of payment of the Member’s vested Plan benefits is also changed to a date at least
five years later than the Member’s date of retirement or termination of employment, if that additional five year deferral of the time of payment is required by Code Section 409A and applicable regulations. The new election will not be
effective until the date that is 12 months after it is made in writing and delivered to the Plan Committee. 
  
 3.03 (d) If a Member had elected a form of payment under Section 3.03 (a)(ii), (iii), (iv), (v) or (vi) and dies after the date
his benefit payments under the Plan had commenced, the only death benefit, if any, payable under the Plan in respect of said Member shall be the amount, if any, payable under the form of payment which the Member had elected under the Plan. If a
Member had elected a form of payment under this Section 3.03 and dies before the date his benefit payments under the Plan commence, that form of payment election does not apply and the lump sum death benefit described in Section 3.04 below
shall be paid to the Member’s beneficiary. 
  
 3.03
(e) Election of a form of payment under this Section 3.03 may be made only on a form prescribed by the Committee and filed by the Member with the Committee as provided under Section 3.03(a) above. 
  
 3.04 Upon the death of a Member who is receiving the Regular Form of
Payment (a Single Life Annuity Plus Death Benefit) under Section 3.02 or 3.03 above, or upon the death of a 

  

 6 

 
Member who died before his or her benefit payments under the Plan commenced, a death benefit shall be paid to the Member’s beneficiary in a lump sum
equal to the excess, if any, of (i) over (ii), where 
  
 i. is an amount equal to 12 times the annual benefit, if any, payable under Section 3.02 or Section 3.03(a)(i) above, and 
  

 ii. is the sum of the benefit payments, if any, which the Member had received under the Plan. 
  
 3.05 If a Member is restored to employment with the Employer after
payment of his benefit under the Plan has commenced, all payments under the Plan shall thereupon be discontinued. Upon the Member’s subsequent retirement or termination of employment with the Employer, his benefit under the Plan shall be
recomputed in accordance with Sections 3.01, 3.02, 3.03 and 3.04, and any amendments made to this Plan, including amendments to the 2006 Pentegra benefit formula, but shall be reduced by the actuarial equivalent value of the amount of any
benefit paid by the Plan in respect of his previous retirement or termination of employment, and such reduced benefit shall be paid to the Member in accordance with the provisions of the Plan. For purposes of this Section 3.05, the actuarial
equivalent value to the benefit paid in respect of a Member’s previous retirement or termination of employment shall be determined by the Actuary utilizing for that purpose the same actuarial factors and assumptions used by the 2006 Pentegra
Plan to determine actuarial equivalence, unless the Board amends this Plan to change the actuarial equivalence definition for purposes of determining the actuarial equivalent value to that benefit. 
  

 7 

 Article 4. Source and Method of Payments 
  
 4.01 All payments of benefits under the Plan shall be paid from, and
shall only be a general claim upon, the general assets of the Employer, notwithstanding that the Employer, in its discretion, may establish a bookkeeping reserve or a grantor trust (as such term is used in Sections 671 through 677 of the Code)
to reflect or to aid it in meeting its obligations under the Plan with respect to any Member or beneficiary. No benefit whatever provided by the Plan shall be payable from the assets of the Pentegra Plan. No Member shall have any right, title or
interest whatever in any investments which the Employer may make or any specific assets which the Employer may reserve to aid it in meeting its obligations under the Plan. 
  

 4.02 Should the Employer choose to establish a bookkeeping reserve or a grantor trust, the amount of the reserve or the funding of
the trust may be based upon actuarially determined amounts reflecting the benefit payable, and funding of any grantor trust shall be subject to approval by the Board of Directors and the Federal Housing Finance Board. 
  
 4.03 Subject to Section 3.04, all vested Plan benefit payments
shall commence within 60 days following the Member’s termination of employment, death, or retirement date as defined in the Pentegra Plan. 
  

 8 

 Article 5. Designation of Beneficiaries 
  
 5.01 The beneficiary who shall be entitled to receive the amount, if
any, payable under the Plan upon a Member’s death shall be the beneficiary whom the Member has designated on a Plan beneficiary designation form provided to the Member by the Committee. 
  
 5.02 If no such valid Plan beneficiary designation is in effect at the
time of a Member’s death, or if no designated beneficiary survives the Member, the Member’s estate shall be deemed to have been designated his beneficiary and shall be paid the amount, if any, payable under the Plan upon the Member’s
death. If the Committee is in doubt as to the right of any person to receive such amount, the Committee may pay such amount into any court of appropriate jurisdiction and such payment shall be a complete discharge of the liability of the Plan and
the Employer therefor. 
  

 9 

 Article 6. Administration of the Plan 
  
 6.01 The Board of Directors has delegated to the Committee, subject to
those powers which the Board has reserved as described in Article 7 below, general authority over and responsibility for the ministerial administration of the Plan. The Committee shall, subject to the review and approval of the Human Resources
Committee of the Board of Directors, interpret and construe the Plan, make all determinations considered necessary or advisable for the administration of the Plan and the calculations of the amount of benefits payable thereunder, and review claims
for benefits under the Plan. The Human Resources Committee of the Board of Directors’ interpretations and constructions of the Plan and its decisions or actions thereunder shall be binding and conclusive on all persons for all purposes.

  
 6.02 If the Committee deems it advisable, it shall
arrange for the engagement of the Actuary, and legal counsel and certified public accountants (who may be counsel or accountants for the Employer), and other consultants, and make use of agents and clerical or other personnel, for purposes of the
Plan. The Committee may rely upon the written opinions of such Actuary, counsel, accountants, and consultants, and delegate to any agent or to any subcommittee or Committee member its authority to perform any act hereunder, including without
limitations those matters involving the exercise of discretion; provided, however, that such delegations shall be subject to revocations at any time at the discretion of the Committee. The Committee shall report to the Human Resources Committee of
the Board of Directors at least once each calendar year with regard to the matters for which it is responsible under the Plan. 
  
 6.03 The Committee shall consist of at least three individuals, each of whom shall be appointed by, shall remain in office at the will of, and may
be removed, with or without cause, by the Board of Directors. No Committee member shall be entitled to act on or decide any matters relating solely to such member or any of his rights or benefits under the Plan. Any Committee member may resign at
any time. A Committee member shall not receive any special compensation for serving in such capacity but shall be reimbursed for any reasonable expenses incurred in connection therewith. No bond or other security need be required of the Committee or
any member thereof in any jurisdiction. 
  
 6.04 The
Committee shall elect or designate its own Chairman, establish its own procedures and the time and place for its meetings and provide for the keeping of minutes of all meetings. Any action of the Committee may be taken upon the affirmative vote of a
majority of the members at a meeting or, at the direction of its Chairman, without a meeting by mail or telephone, provided that all of the Committee members are informed in writing of the vote. 
  
 6.05 All claims for benefits under the Plan shall be submitted in
writing to the Chairman of the Committee. The Committee will present its determination regarding all claims to the Human Resources Committee of the Board of Directors for approval. Written notice of the decision on each such claim shall be furnished
with reasonable promptness to the Member or his beneficiary (the “claimant”). The claimant may request a review by the Human Resources Committee of the Board of Directors of any decision denying the claim in whole or in part. Such request
shall be made in writing and filed with the Human Resources Committee of the Board of Directors within 30 days of such denial. A request for review shall contain all additional information which the claimant wishes the Human Resources Committee of
the Board of 

  

 10 

 
Directors to consider. The Human Resources Committee of the Board of Directors may hold any hearing or conduct any independent investigation which it deems
desirable to render its decision, and the decision on review shall be made as soon as feasible after the Human Resources Committee of the Board of Directors’ receipt of the request for review. Written notice of the decision on review shall be
furnished to the claimant. For all purposes under the Plan, such decisions on claims (where no review is requested) and decisions on review (where review is requested) shall be final, binding and conclusive on all interested persons as to all
matters relating to the Plan. 
  
 6.06 All expenses
incurred by the Committee and the Human Resources Committee of the Board of Directors in its administration of the Plan shall be paid by the Employer. 
  

 11 

 Article 7. Amendment and Termination 
  
 7.01 The Board of Directors may amend, suspend or terminate, in whole
or in part, the Plan without the consent of the Committee, any Member, beneficiary or other person, except that no amendment, suspension or termination shall retroactively impair of otherwise adversely affect the vested rights of any Member,
beneficiary or other person to benefits under the Plan which have accrued prior to the date of such action. Provided, however, that the 2006 Pentegra Plan benefit formula used to determine a Member’s benefits under this Plan may be amended by
the Board to freeze the Member’s accrued benefit under this Plan or to change the benefit formula prospectively, the Board may amend this Plan to change the definition of actuarial equivalence for purposes of determining actuarial equivalent
benefits, and the Member’s benefit shall be designed to meet the requirements of Code Section 409A and applicable regulations. 
  
 The Board of Directors also delegates amendment authority to the Committee to adopt Plan amendments
which are of an administrative nature or are required under applicable law, provided that any such amendment is reported to the Board within 2 1/2 months after the end of the Plan Year in which that amendment is adopted. 
  

 12 

 Article 8. General Provisions 
  
 8.01 The Plan shall be binding upon and inure to the benefit of the
Employer and its successors and assigns and the Members, and the successors, assigns, designees and estates of the Members. The Plan shall also be binding upon and inure to the benefit of any successor organization succeeding to substantially all of
the assets and business of the Employer, but nothing in the Plan shall preclude the Employer from merging or consolidating into or with, or transferring all or substantially all of its assets to, another organization which assumes the Plan and all
obligation of the Employer hereunder. The Employer agrees that it will make appropriate provision for the preservation of the Members’ rights under the Plan in any agreement or plan which it may enter into to effect any merger, consolidation,
reorganization, or transfer of assets. Upon such a merger, consolidation, reorganization, or transfer of assets and assumption of Plan obligations of the Employer, the term “Employer” shall refer to such other organization and the Plan
shall continue in full force and effect to the extent such successor organization has assumed the Plan. If such successor organization does not assume the Plan, the Employer remains liable for payment of Plan benefits under this Plan. 
  
 8.02 Neither the Plan nor any action taken thereunder shall be
construed as giving to a Member the right to be retained in the employ of the Employer or as affecting the right of the Employer to dismiss any Member from its employ. 
  

 8.03 The Employer shall withhold or cause to be withheld from all benefits payable under the Plan all federal, state, local or other
taxes required by applicable law to be withheld with respect to such payments. 
  
 8.04 No right or interest of a Member under the Plan may be assigned, sold, encumbered, transferred or otherwise disposed of and any attempted disposition of such right or interest shall be null and void.

  
 8.05 If the Committee shall find that any person to
whom any amount is or was payable under the Plan is unable to care for his or her affairs because of illness or accident, or is a minor, or has died, then any payment, or any part therefor, due to such person or his or her estate (unless a prior
claim therefor has been made by a duly appointed legal representative), may, if the Committee is so inclined, be paid to such person’s spouse, adult child or other relative, an institution maintaining or having custody of such person, or any
other person deemed by the Committee to be a proper recipient on behalf of such person otherwise entitled to payment. Any such payment shall be in complete discharge of the liability of the Plan and the Employer therefor. 
  
 8.06 The unpaid balance of any account maintained pursuant to this
Plan is an unsecured, general obligation of the Employer. All amounts deferred hereunder remain the unrestricted assets of the Employer. Any assets purchased shall remain the sole property of the Employer subject to the claims of its general
creditors and shall be available for the Employer’s use for whatever purpose desired. No Participant hereunder shall have any right other than the unsecured promise of the Employer to pay deferred Compensation in the future. No Participant has
ownership rights with respect to any asset of the Employer by reason of his or her participation in this Plan. 
  

 13 

 8.07 All elections, designations, requests, notices, instructions, and other communications from a
Member, beneficiary or other person to the Committee required or permitted under the Plan shall be in such form as is prescribed from time to time by the Committee and shall be mailed by first-class mail or delivered to such location as shall be
specified by the Committee and shall be deemed to have been given and delivered only upon actual receipt thereof at such location. 
  
 8.08 The benefits payable under the Plan shall be in addition to all other benefits provided for employees of the Employer and shall not be deemed
salary or other compensation by the Employer for the purpose of computing benefits to which any employee may be entitled under any plan or arrangement of the Employer. 
  

 8.09 No Committee member shall be personally liable by reason of any instrument executed by him or her or on his or her behalf, or
action taken by him or her, in his or her capacity as a Committee member nor for any mistake of judgment made in good faith, unless due to the Committee member’s willful misconduct or gross negligence. The Employer shall indemnify and hold
harmless each Committee member and each employee, officer or director of the Employer, to whom any duty, power, function or action in respect of the Plan may be delegated or assigned, against any cost or expense (including fees of legal counsel) and
liability (including any sum paid in settlement of a claim or legal action with the approval of the Employer) arising out of anything done or omitted to be done in connection with the Plan, unless arising out of such person’s fraud, bad faith,
willful misconduct or gross negligence. 
  
 8.10 As used in
the Plan, the masculine gender shall be deemed to refer to the feminine, and the singular person shall be deemed to refer to the plural, wherever appropriate. 
  

8.11 The captions preceding the section of the Plan have been inserted solely as a matter of convenience and shall not in any manner define or
limit the scope or intent of any provisions of the Plan. 
  
 8.12 The Plan shall be construed, administered and enforced according to the laws of the State of Washington in effect from time to time. Venue shall also be in the State of Washington. 
  
 This Executive Supplemental Retirement Plan has been duly executed by the
Employer’s authorized representative this             day of
                    , 2006, to be effective as of the 1st day of January, 2007. 
  

			
	 FEDERAL HOME LOAN BANK OF SEATTLE

		
	 By:
	 	 
		 	 Its                                      
                                        
            

  

 14

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