Document:

EXHIBIT 10.10 TO CODORUS VALLEY BANCORP, INC. FORM 10-K FOR FISCAL YEAR ENDED 12-31-2009

EXHIBIT 10.10

AMENDMENT TO SALARY CONTINUATION AGREEMENT

          This
Amendment to Salary Continuation Agreement (the “Amendment”) is made this 27th
day of December, 2005, by and among PeoplesBank, A Codorus Valley Company, a
Pennsylvania banking institution (the “Bank”), and a wholly owned subsidiary of
Codorus Valley Bancorp, Inc., a Pennsylvania business corporation (the
“Corporation”) and ____________, an adult individual (the “Executive”).

WITNESSETH

          WHEREAS, the Bank and the Executive entered
into a certain Salary Continuation Agreement effective the 1st day
of October, 1998 (the “Salary Continuation Agreement”), which is attached
hereto; 

          WHEREAS, as a result of action by the Board
of Directors, the Bank and the Executive desire to amend the Salary
Continuation Agreement provisions regarding the definition of “Change in
Control” and “Change in Control Benefits,” which describes the payment of the
Executive’s benefit following a Change in Control, and certain other provisions
of the Salary Continuation Agreement;

          WHEREAS, in recognition of the valued
services provided by the Executive in the past to the Bank and the Corporation,
the Bank desires to amend the Salary Continuation Agreement, as an incentive
for the Executive to continue to provide such valued services in the future;

          NOW THEREFORE, in consideration of the
mutual covenants and agreements set forth herein, for good and valuable
consideration, and intending to be legally bound hereby, the Bank and the Executive
agree as follows:

	
  

 	
  

 	
  

 
	
  

 	
           1. The
 Amendment is incorporated into the Salary Continuation Agreement by the Bank,
 the Corporation and the Executive, in accordance with Article 7 of the Salary
 Continuation Agreement, entitled “Amendments and Termination.”

 
	
  

 	
  

 
	
  

 	
           2. All
 terms set forth in the Amendment shall be defined and interpreted by the
 definitions, construction and intent of the Salary Continuation Agreement and
 shall have the same meaning as therein provided unless the context clearly
 requires a different meaning.

 
	
  

 	
  

 
	
  

 	
           3.
 Section 1.1.1 of the Salary Continuation Agreement is hereby amended by
 deleting the existing definition of “Change in Control” in its entirety and
 by adding a new definition of “Change in Control” as follows:

 

	
  

 	
  

 
	
  

 	
           1.1.1 CHANGE OF CONTROL. For purposes of
 this Agreement, the term “Change of Control” shall mean: a Change in the
 Ownership of the Corporation or the Bank, (as defined below), a Change in the
 Effective Control of the Corporation or the Bank (as defined below), or a
 Change in the Ownership of a Substantial Portion of the Assets of the
 Corporation or the Bank, (as defined below).

 

	
  

 	
  

 
	
  

 	
           (a) Change
 in the Ownership of the Corporation or the Bank. A Change in the
 Ownership of the Corporation or the Bank occurs on the date that any one
 person, or more than one person acting as a group (as defined below),
 acquires ownership of stock of the Corporation or the Bank that, together
 with stock held by such person or group, constitutes more than 50 percent of
 the total fair market value or total voting power of the

 

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 stock of the Corporation or the Bank. However, if any one person, or more than one
 person acting as a group, is considered to own more than 50 percent of the
 total fair market value or total voting power of the stock of the Corporation
 or the Bank, the acquisition of additional stock by the same person or
 persons is not considered to cause a Change in the Ownership of the
 Corporation or the Bank. An increase in the percentage of stock owned by any
 one person, or persons acting as a group, as a result of a transaction in
 which the Corporation or the Bank acquires its stock in exchange for property
 will be treated as an acquisition of stock for these purposes. A change in ownership
 of the Corporation or the Bank only occurs when there is a transfer or
 issuance of stock of the Corporation or the Bank and the stock remains
 outstanding after the transaction.

 
	
  

 	
  

 
	
  

 	
           (b) Change
 in Effective Control of the Corporation or the Bank. A Change in
 Effective Control of the Corporation or the Bank occurs only on the date that
 either:

 

	
  

 	
  

 
	
  

 	
           (i) Any
 one person, or more than one person acting as a group (as defined below),
 acquires (or has acquired during the 12-month period ending on the date of
 the most recent acquisition by such person or persons) ownership of stock of
 the Corporation or the Bank possessing 35 percent or more of the total voting
 power of the stock of the Corporation or the Bank; or

 
	
  

 	
  

 
	
  

 	
           (ii) A majority
 of members of the Corporation’s Board of Directors is replaced during any
 12-month period by directors whose appointment or election is not endorsed by
 a majority of the members of the Corporation’s Board of Directors prior to
 the date of the appointment or election. 

 
	
  

 	
  

 
	
  

 	
           If any
 one person, or more than one person acting as a group, is considered to
 effectively control the Corporation or the Bank, the acquisition of
 additional control of the Corporation or the Bank by the same person or persons
 is not considered to cause a Change in the Effective Control of the
 Corporation or the Bank.

 

	
  

 	
  

 
	
  

 	
           (c) Change in Ownership of a Substantial Portion of the
 Corporation’s or the Bank’s Assets. A Change in Ownership of a
 Substantial Portion of the Corporation’s or the Bank’s Assets occurs on the
 date that any one person, or more than one person acting as a group (as
 defined below), acquires (or has acquired during the 12-month period ending
 on the date of the most recent acquisition by such person or persons) assets
 from the Corporation or the Bank that have a total gross fair market value
 equal to or more than 40 percent of the total gross fair market value of all
 of the assets of the Corporation or the Bank immediately prior to such
 acquisition or acquisitions. For this purpose, gross fair market value means
 the value of assets of the Corporation or the Bank, or the value of the
 assets being disposed of, determined without regard to any liabilities
 associated with such assets. 

 
	
  

 	
  

 
	
  

 	
           There is no Change in Control under this Section 1.1.1 if there is a
 transfer of assets to an entity that is:

 

	
  

 	
  

 
	
  

 	
           (i) A
 shareholder of the Corporation or the Bank (immediately before the asset
 transfer) in exchange for or with respect to its stock;

 
	
  

 	
  

 
	
  

 	
           (ii) An
 entity, 50 percent or more of the total value or voting power of which is
 owned, directly or indirectly, by the Corporation or the Bank;

 

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           (iii) A
 person, or more than one person acting as a group, that owns, directly or
 indirectly, 50 percent or more of the total value or voting power of all the
 outstanding stock of the Corporation or the Bank; or

 
	
  

 	
  

 
	
  

 	
           (iv) An
 entity, at least 50 percent of the total value or voting power of which is
 owned, directly or indirectly, by a person described in (i), (ii) or (iii)
 above.

 

	
  

 	
  

 
	
  

 	
           (d) For purposes of this Section 1.1.1, persons will not be
 considered to be acting as a group solely because they purchase or own stock
 or purchase assets of the Corporation or the Bank at the same time. However,
 persons will be considered to be acting as a group if they are owners of a
 corporation that enters into a merger, consolidation, purchase or acquisition
 of assets, or similar transaction, such shareholder is considered to be
 acting as a group with other shareholders in a corporation only to the extent
 of the ownership in that corporation prior to the transaction giving rise to
 the change and not with respect to the ownership interest in the other
 corporation.

 

	
  

 	
  

 
	
  

 	
           4.
 Section 1.1.2 of the Salary Continuation Agreement is hereby amended by
 deleting the existing definition of “Date of Change of Control” in its
 entirety and by adding a new definition of “Date of Change of Control” as
 follows:

 

	
  

 	
  

 
	
  

 	
           1.1.2
 “Date of Change of Control” means the date on which a “Change of Control”
 event occurs under Section 1.1.1.

 

	
  

 	
  

 
	
  

 	
           5. Section
1.1.4 of the Salary Continuation Agreement is hereby amended by deleting the
existing definition of “Disability” in its entirety and by adding a new definition
of “Disability” as follows:

 

	
  

 	
  

 
	
  

 	
           1.1.4
 “Disability” means, if the Executive is covered by a Company sponsored
 disability policy, total disability as defined in such policy without regard
 to any waiting period, provided that the definition of disability applied
 under such policy complies with the requirement of Section 1.409A-3(g)(4) of
 the Treasury regulations. If the Executive is not covered by such policy,
 Disability means that the Executive is unable to engage in any substantial
 gainful activity by reason of any medically determinable physical or mental
 impairment that can be expected to result in death or can be expected to last
 for a continuous period of not less than 12 months. As a condition to any
 benefit, the Company may require the Executive to submit to such physical or
 mental evaluations and tests as the Company’s Board of Directors deems
 appropriate.

 

	
  

 	
  

 
	
  

 	
           6.
 Section 2.4 of the Salary Continuation Agreement is hereby amended to add a
 new subsection 2.4.4 “Excise Tax Matters” as follows:

 

	
  

 	
  

 
	
  

 	
           2.4.4
 Excise Tax Matters. 

 
	
  

 	
  

 
	
  

 	
           In the
 event that the amounts and benefits payable under this Section 2.4, when
 added to other amounts and benefits which may become payable to the Executive
 by the Corporation and/or Bank, are such that he becomes subject to the
 excise tax provisions of Section 4999 of the Internal Revenue Code of 1986,
 as amended (the “Code”), the Corporation and the Bank shall pay him such
 additional amount or amounts as will result in his retention (after the
 payment of all federal, state and local excise, employment, and income taxes
 on such payments and the value of such benefits) of a net amount equal to the
 net amount he would have retained had the initially calculated payments and
 benefits been subject only to income and employment taxation. For purposes of
 the preceding 

 

92

	
  

 	
  

 
	
  

 	
 sentence, the Executive shall be deemed to be subject to the highest
 marginal federal, state and local tax rates. All calculations required to be
 made under this subparagraph shall be made by the Corporation’s independent
 certified public accountants, subject to the right of Executive’s
 representative to review the same. All such amounts required to be paid shall
 be paid at the time any withholding may be required under applicable law, and
 any additional amounts to which the Executive may be entitled shall be paid
 or reimbursed no later than fifteen (15) days following confirmation of such
 amount by the Corporation’s accountants. In the event any amounts paid
 hereunder are subsequently determined to be in error because estimates were
 required or otherwise, the parties agree to reimburse each other to correct
 such error, as appropriate, and to pay interest thereon at the applicable
 federal rate (as determined under Code Section 1274A for the period of time
 such erroneous amount remained outstanding and unreimbursed). The parties
 recognize that the actual implementation of the provision of this
 subparagraph are complex and agree to deal with each other in good faith to
 resolve any questions or disagreements arising hereunder.

 

	
  

 	
  

 
	
  

 	
           7.
 Article 2 of the Salary Continuation Agreement is hereby amended by adding a
 new Section 2.5 to read as follows:

 

	
  

 	
  

 
	
  

 	
           2.5 Key
 Employee. Notwithstanding anything in this Article to the contrary, in the
 event Executive is determined to be a Key Employee, as that term is defined
 in Section 409A of the Code and the regulations promulgated thereunder,
 payments to the Executive under Section 2.1 or 2.2 of this Agreement shall begin
 not earlier than the first day of the seventh month following termination of
 employment. For purposes of the foregoing, the date upon which a
 determination is made as to the Key Employee status of the Executive, the
 Indemnification Date (as defined in Section 409A of the Code and the
 regulations promulgated thereunder) shall be December 31.

 

	
  

 	
  

 
	
  

 	
           8. Article
5 of the Salary Continuation Agreement is hereby amended by adding a new
Section 5.3.4 to read as follows:

 

	
  

 	
  

 
	
  

 	
           5.3.4
 Termination Following Change of Control. Notwithstanding the foregoing, it is
 the intention of the parties that the restrictions set forth in Sections
 5.3.1(i). (ii), (iii) and (iv) shall not apply in the event Executive’s
 employment terminates following a Change of Control, as defined in the
 Agreement.

 

	
  

 	
  

 
	
  

 	
           9.
 Article 8 of the Salary Continuation Agreement is hereby amended by adding a
 new Section 8.12 to read as follows:

 

	
  

 	
  

 
	
  

 	
           8.12 RABBI
 TRUST. The Corporation is establishing contemporaneously herewith a rabbi
 trust (the “Trust”), to which it is contributing an initial corpus of $100.
 In the event of a change of control as defined herein, the Corporation shall,
 in accordance with the terms of the Trust, contribute thereto the amount
 described in Section 1(e) thereof. Thereafter, amounts payable hereunder
 shall be paid first from the assets of such Trust and the income thereon. To
 the extent that the assets of the Trust and the income thereon are
 insufficient, the Corporation or any successor of the Corporation shall pay
 Executive the amount due hereunder.

 

	
  

 	
  

 
	
  

 	
           10. In
 all other respects, the Salary Continuation Agreement, as amended above, is
 hereby ratified and confirmed by the Bank, the Corporation and the Executive
 All other provisions of the Salary Continuation Agreement shall remain in
 full force and effect as amended hereby.

 

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          IN WITNESS WHEREOF, the parties, each
intending to be legally bound, have executed the amendment as of the date,
month and year first above written.

	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ATTEST:

 	
 PEOPLESBANK,
 A CODORUS VALLEY COMPANY

 
	
  

 	
  

 
	
  

 	
  

 	
 By: 

 	
  

 	
  

 
	
 Secretary

 	
  

 	
 Chairman of
 the Board

 	
  

 
	
  

 	
  

 
	
 WITNESS:

 	
  

 
	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 

94EXHIBIT 10.11 TO CODORUS VALLEY BANCORP, INC. FORM 10-K FOR FISCAL YEAR ENDED 12-31-2009

EXHIBIT 10.11

SECOND AMENDMENT

TO THE

PEOPLESBANK, A CODORUS VALLEY COMPANY

SALARY CONTINUATION AGREEMENT

DATED OCTOBER 1, 1998

AND AMENDED DECEMBER 27, 2005

FOR

	
  

 	
  

 	
  

 
	
  

 	
 

 	
  

 

          THIS
SECOND AMENDMENT is adopted this 23rd day of December, 2008, and is effective
January 1, 2009, by and between PeoplesBank, A Codorus Valley Company, a
Pennsylvania banking institution located in York, Pennsylvania (the “Bank”) and
a wholly owned subsidiary of Codorus Valley Bancorp, Inc. (the “Corporation”)
and _______________ (the “Executive”). 

          The
Bank and the Executive executed the Salary Continuation Agreement effective
October 1, 1998, and executed a First Amendment on December 27, 2005 (the
“Agreement”). 

          The undersigned hereby amend the Agreement for the
purpose of revising the Normal Retirement Benefit, removing the Discount Rate,
and updating for consistency between documents. Therefore, the following
changes shall be made: 

          Section 1.1.9 of the Agreement shall be deleted in its
entirety and replaced with the following: 

	
  

 	
  

 
	
 1.1.9

 	
  “Plan Year” means the
 twelve month period beginning on January 1 and ending on December 31. 

 

          Section 1.1.11 of the Agreement shall be deleted in
its entirety and replaced with the following: 

	
  

 	
  

 
	
 1.1.11

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

 

          Section
2.1.1 of the Agreement shall be deleted in its entirety and replaced with the
following: 

	
  

 	
  

 	
  

 
	
  

 	
 2.1.1

 	
 Amount of Benefit. The annual benefit under
 this Section 2.1 is $______________. For the first five (5) year period after
 Normal Retirement Age but prior to Termination of Employment, the Bank shall
 increase the annual Normal Retirement Benefit by .3274%, compounded monthly,
 for each complete month prior to Termination of Employment. 

 

          Section
2.1.3 of the Agreement shall be deleted in its entirety. 

          Sections
2.2.1 and 2.2.2 of the Agreement shall be deleted in their entirety and
replaced with the following: 

95

	
  

 	
  

 	
  

 
	
  

 	
 2.2.1

 	
 Amount of Benefit. The benefit under this
 Section 2.2 is the Early Termination Annual Benefit set forth on Schedule A.
 For any Separation from Service which occurs other than at the end of the
 Plan Year, the benefit shall be pro rated to take into account the
 Executive’s service during such partial Plan Year by dividing the difference
 in the balance at the end of the current Plan Year and the balance at the end
 of the preceding Plan Year into twelve (12) and multiplying this amount by
 the number of completed months since the last complete Plan Year. This amount
 will be added to the Annual Benefit amount at the end of the preceding Plan
 Year on Schedule A. 

 
	
  

 	
  

 	
  

 
	
  

 	
 2.2.2

 	
 Payment of Benefit. The Bank shall pay the
 annual benefit to the Executive in twelve (12) equal monthly installments
 payable on the first day each month commencing with the month following
 Normal Retirement Age and continuing for __________ additional months. 

 

          Section
2.2.3 of the Agreement shall be deleted in its entirety. 

          Sections
2.3, 2.3.1 and 2.3.2 of the Agreement shall be deleted in their entirety and
replaced with the following: 

	
  

 	
  

 	
  

 
	
 2.3

 	
 Disability Benefit. If the Executive
 experiences a 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 Agreement. 

 
	
  

 	
  

 	
  

 
	
  

 	
 2.3.1

 	
 Amount of Benefit. The benefit under this
 Section 2.3 is the Disability Annual Benefit set forth on Schedule A. For any
 Disability which occurs other than at the end of the Plan Year, the benefit
 shall be pro rated to take into account the Executive’s service during such
 partial Plan Year by dividing the difference in the balance at the end of the
 current Plan Year and the balance at the end of the preceding Plan Year into
 twelve (12) and multiplying this amount by the number of completed months
 since the last complete Plan Year. This amount will be added to the Annual
 Benefit amount at the end of the preceding Plan Year on Schedule A. 

 
	
  

 	
  

 	
  

 
	
  

 	
 2.3.2

 	
 Payment of Benefit. The Bank shall pay the
 annual benefit amount to the Executive in twelve (12) equal monthly
 installments payable on the first day of each month commencing with the month
 following the Disability and continuing for _____ additional months. 

 

          Section
2.3.3 of the Agreement shall be deleted in its entirety. 

          Section
2.4.2 of the Agreement shall be deleted in its entirety and replaced with the
following: 

	
  

 	
  

 	
  

 
	
  

 	
 2.4.2

 	
 Payment of Benefit. The Bank shall pay the
 annual benefit amount to the Executive in twelve (12) equal monthly
 installments payable on the first day of each month commencing with the month
 following the Executive’s Normal Retirement Age and continuing for _______
 additional months. 

 

          Section
2.4.3 of the Agreement shall be deleted in its entirety. 

          The following Sections 2.6 and 2.7shall be added to
the Agreement immediately following Section 2.5: 

96

	
  

 	
  

 
	
 2.6

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

 
	
  

 	
  

 
	
 2.7

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

 

	
  

 	
  

 	
  

 
	
  

 	
 (a)

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

 
	
  

 	
  

 	
  

 
	
  

 	
 (b)

 	
 must, for
 benefits distributable under Sections 2.2 and 2.4 be made at least twelve
 (12) months prior to the first scheduled distribution; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (c)

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

 
	
  

 	
  

 	
  

 
	
  

 	
 (d)

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

 

          Section
8.8 of the Agreement shall be deleted in its entirety. 

          IN WITNESS OF THE ABOVE, the Executive and
the Bank hereby consent to this Second Amendment. 

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Executive:

 	
  

 	
 PeoplesBank,
 A Codorus Valley Company 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 By

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Title

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Chairman

 	
  

 

97

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