Document:

Exhibit 10.1

      

       

      The York Water Company

      

      

       

      

      $30,000,000

      

      

       

        

      3.24% Senior Notes due September 30, 2050

       

        

      

      

      
        

      

      

      Note Purchase Agreement

      

      

      
        

      

      

       

      

      Dated September 30, 2020

       

      
        
          

      

      
      Table of Contents

       

      	
              Section

            	
              Heading

            	
              Page

            
	
              Section 1.

            	
              Authorization of Notes

            	
              1

            
	 	 	 
	
              Section 2.

            	
              Sale and Purchase of Notes

            	
              1

            
	 	 	 
	
              Section 3.

            	
              Closing

            	
              2

            
	 	 	 
	
              Section 4.

            	
              Conditions to Closing

            	
              2

            
	 	 	 

      	 	
              Section 4.1.

            	
              Representations and Warranties

            	2

            
	 	
              Section 4.2.

            	
              Performance; No Default

            	
              2

            
	 	
              Section 4.3.

            	
              Compliance Certificates

            	
              2

            
	 	
              Section 4.4.

            	
              Opinions of Counsel

            	
              3

              

            
	 	
              Section 4.5.

            	
              Purchase Permitted By Applicable Law, Etc.

            	
              3

            
	 	
              Section 4.6.

            	
              Sale of Other Notes

            	
              3

            
	 	
              Section 4.7.

            	
              Payment of Special Counsel Fees

            	
              3

            
	 	
              Section 4.8.

            	
              Private Placement Number

            	
              3

            
	 	
              Section 4.9.

            	
              Changes in Corporate Structure

            	
              3

            
	 	
              Section 4.10.

            	
              Funding Instructions

            	
              3

            
	 	
              Section 4.11.

            	
              Commission Approval

            	
              4

            
	 	
              Section 4.12.

            	
              Consent of Holders of Other Securities

            	
              4

            
	 	
              Section 4.13.

            	
              Proceedings and Documents

            	
              4

            
	 	 	 	 

      	
              Section 5.

            	
              Representations and Warranties of the Company

            	
              4

            
	 	 	 

      	 	
              Section 5.1.

            	
              Organization; Power and Authority

            	
              4

            
	 	
              Section 5.2.

            	
              Authorization, Etc.

            	
              4

            
	 	
              Section 5.3.

            	
              Disclosure

            	
              5

            
	 	
              Section 5.4.

            	
              Organization and Ownership of Shares of Subsidiaries; Affiliates

            	
              5

            
	 	
              Section 5.5.

            	
              Financial Statements; Material Liabilities

            	
              5

            
	 	
              Section 5.6.

            	
              Compliance with Laws, Other Instruments, Etc.

            	
              5

            
	 	
              Section 5.7.

            	
              Governmental Authorizations, Etc.

            	
              5

            
	 	
              Section 5.8.

            	
              Litigation; Observance of Statutes and Orders

            	
              6

            
	 	
              Section 5.9.

            	
              Taxes

            	
              6

            
	 	
              Section 5.10.

            	
              Title to Property; Leases

            	
              6

            
	 	
              Section 5.11.

            	
              Licenses, Permits, Etc.

            	
              6

            
	 	
              Section 5.12.

            	
              Compliance with Employee Benefit Plans

            	
              7

            
	 	
              Section 5.13.

            	
              Private Offering by the Company

            	
              7

            
	 	
              Section 5.14.

            	
              Use of Proceeds; Margin Regulations

            	
              8

            
	 	
              Section 5.15.

            	
              Existing Indebtedness

            	
              8

            
	 	
              Section 5.16.

            	
              Foreign Assets Control Regulations, Etc.

            	
              8

            
	 	
              Section 5.17.

            	
              Status under Certain Statutes

            	
              9

            

       

      
        - i -

        
          

      

      	
              Section 6.

            	
              Representations of the Purchasers

            	
              9

            
	 	 	 

      	 	
              Section 6.1.

            	
              Purchase for Investment

            	
              9

            
	 	
              Section 6.2.

            	
              Source of Funds

            	
              9

            

      	 	 	 
	
              Section 7.

            	
              Information as to Company

            	
              11

            

      	 	 	 	 
	 	
              Section 7.1.

            	
              Financial and Business Information

            	
              11

            
	 	
              Section 7.2.

            	
              Officer’s Certificate

            	
              13

            
	 	
              Section 7.3.

            	
              Visitation

            	
              14

            
	 	
              Section 7.4.

            	
              Electronic Delivery

            	
              14

            
	 	 	 	 

      	
              Section 8.

            	
              Payment and Prepayment of the Notes

            	
              15

            
	 	 	 

      	 	
              Section 8.1.

            	
              Maturity

            	
              15

            
	 	
              Section 8.2.

            	
              Optional Prepayments with Make-Whole Amount

            	
              16

            
	 	
              Section 8.3.

            	
              Allocation of Partial Prepayments

            	
              16

            
	 	
              Section 8.4.

            	
              Maturity; Surrender, Etc.

            	
              16

            
	 	
              Section 8.5.

            	
              Purchase of Notes

            	
              16

            
	 	
              Section 8.6.

            	
              Make-Whole Amount

            	
              17

            
	 	
              Section 8.7.

            	
              Payments Due on Non-Business Days

            	
              18

            
	 	
              Section 8.8.

            	
              [Reserved]

            	
              18

            

      	 	 	 
	
              Section 9.

            	
              Affirmative Covenants.

            	
              21

            

      	 	 	 	 
	 	
              Section 9.1.

            	
              Compliance with Laws

            	
              21

            
	 	
              Section 9.2.

            	
              Insurance

            	
              21

            
	 	
              Section 9.3.

            	
              Maintenance of Properties

            	
              21

            
	 	
              Section 9.4.

            	
              Payment of Taxes

            	
              21

            
	 	
              Section 9.5.

            	
              Corporate Existence, Etc.

            	
              22

            
	 	
              Section 9.6.

            	
              Books and Records

            	
              22

            
	 	
              Section 9.7.

            	
              Subsidiary Guarantors

            	
              22

            

      	 	 	 
	
              Section 10.

            	
              Negative Covenants.

            	
              23

            

      	 	 	 	 
	 	
              Section 10.1.

            	
              Transactions with Affiliates

            	
              23

            
	 	
              Section 10.2.

            	
              Merger, Consolidation, Etc.

            	
              23

            
	 	
              Section 10.3.

            	
              Line of Business

            	
              25

            
	 	
              Section 10.4.

            	
              Economic Sanctions, Etc.

            	
              25

            
	 	
              Section 10.5.

            	
              Liens

            	
              25

            
	 	
              Section 10.6.

            	
              Limitations on Indebtedness

            	
              26

            
	 	
              Section 10.7.

            	
              Dividends, Stock Purchases

            	
              27

            

      	 	 	 
	
              Section 11.

            	
              Events of Default

            	
              28

            
	 	 	 
	
              Section 12.

            	
              Remedies on Default, Etc.

            	
              30

            

      	 	 	 	 
	 	
              Section 12.1.

            	
              Acceleration

            	
              30

            
	 	
              Section 12.2.

            	
              Other Remedies

            	
              31

            
	 	
              Section 12.3.

            	
              Rescission

            	
              31

            
	 	
              Section 12.4.

            	
              No Waivers or Election of Remedies, Expenses, Etc.

            	
              31

            

      

      

      
        - ii -

        
          

      

      	
              Section 13.

            	
              Registration; Exchange; Substitution of Notes

            	
              32

            
	 	 	 

      	 	
              Section 13.1.

            	
              Registration of Notes

            	
              32

            
	 	
              Section 13.2.

            	
              Transfer and Exchange of Notes

            	
              32

            
	 	
              Section 13.3.

            	
              Replacement of Notes

            	
              32

            
	 	 	 	 

      	
              Section 14.

            	
              Payments on Notes

            	
              33

            
	 	 	 

      	 	
              Section 14.1.

            	
              Place of Payment

            	
              33

            
	 	
              Section 14.2.

            	
              Payment by Wire Transfer

            	
              33

            
	 	
              Section 14.3.

            	
              FATCA Information

            	
              34

            
	 	 	 	 

      	
              Section 15.

            	
              Expenses, Etc.

            	
              34

            
	 	 	 

      	 	
              Section 15.1.

            	
              Transaction Expenses

            	
              34

            
	 	
              Section 15.2.

            	
              Certain Taxes

            	
              35

            
	 	
              Section 15.3.

            	
              Survival

            	
              35

            
	 	 	 	 

      	
              Section 16.

            	
              Survival of Representations and Warranties; Entire Agreement

            	
              35

            
	 	 	 
	
              Section 17.

            	
              Amendment and Waiver

            	
              35

            
	 	 	 

      	 	
              Section 17.1.

            	
              Requirements

            	
              35

            
	 	
              Section 17.2.

            	
              Solicitation of Holders of Notes

            	
              36

            
	 	
              Section 17.3.

            	
              Binding Effect, Etc.

            	
              36

            
	 	
              Section 17.4.

            	
              Notes Held by Company, Etc.

            	
              37

            

      	 	 	 
	
              Section 18.

            	
              Notices

            	
              37

            
	 	 	 
	
              Section 19.

            	
              Reproduction of Documents

            	
              37

            
	 	 	 
	
              Section 20.

            	
              Confidential Information

            	
              38

            
	 	 	 
	
              Section 21.

            	
              Substitution of Purchaser

            	
              39

            
	 	 	 
	
              Section 22.

            	
              Miscellaneous

            	
              39

            

      	 	 	 	 
	 	
              Section 22.1.

            	
              Successors and Assigns

            	
              39

            
	 	
              Section 22.2.

            	
              Accounting Terms

            	
              40

              

            
	 	
              Section 22.3.

            	
              Severability

            	
              40

            
	 	
              Section 22.4.

            	
              Construction, Etc.

            	
              40

            
	 	
              Section 22.5.

            	
              Counterparts; Electronic Contracting

            	
              41

            
	 	
              Section 22.6.

            	
              Governing Law

            	
              41

            
	 	
              Section 22.7.

            	
              Jurisdiction and Process; Waiver of Jury Trial

            	
              41

            

       

      

      
        - iii -

        
          

      

      	
              Schedule A

            	
              —

            	
              Defined Terms

            
	 	 	 
	
              Schedule 1

            	
              —

            	
              Form of 3.24% Senior Note due September 30, 2050

            
	 	 	 
	
              Schedule 4.4(a)

            	
               —

            	Form of Opinion of Special Counsel for the Company
	 	 	 
	
              Schedule 4.4(b)

            	
              —

            	 Form of Opinion of Special Counsel for the Purchasers
	 	 	 
	
              Schedule 5.3

            	
              —

            	
              Disclosure Materials

            
	 	 	 
	
              Schedule 5.4

            	
              —

            	
              Subsidiaries of the Company and Ownership of Subsidiary Stock

            
	 	 	 
	
              Schedule 5.5

            	
              —

            	
              Financial Statements

            
	 	 	 
	
              Schedule 5.15

            	
              —

            	
              Existing Indebtedness

            

      

      

      	
              Purchaser Schedule

            	
              —

            	
              Information Relating to Purchasers

            

      

      

      
        - iv -

        
          

      

      The York Water Company

      130 East Market Street

      York, Pennsylvania  17405

      

      

      3.24% Senior Notes due September 30, 2050

      

      

      September 30, 2020

       

      

      To Each of the Purchasers Listed in

      the Purchaser Schedule Hereto:

       

      Ladies and Gentlemen:

       

      The York Water Company, a Pennsylvania corporation (the “Company”), agrees with each of the Purchasers as follows:

       

      Section 1.          Authorization

            of Notes.

       

      The Company will authorize the issue and sale of $30,000,000 aggregate principal amount of its 3.24% Senior Notes due September 30, 2050 (the “Notes”).  The Notes shall be substantially in the form set out in Schedule 1.  Certain capitalized and other terms used in this Agreement are defined in Schedule A and, for purposes of this Agreement, the rules
        of construction set forth in Section 22.4 shall govern.

       

      Section 2.          Sale and
            Purchase of Notes.

       

      Subject to the terms and conditions of this Agreement, the Company will issue and sell to each Purchaser and each Purchaser will purchase from the Company, at the Closing provided for in Section 3,
        Notes in the principal amount specified opposite such Purchaser’s name in the Purchaser Schedule at the purchase price of 100% of the principal amount thereof.  The Purchasers’ obligations hereunder are several and not joint obligations and no
        Purchaser shall have any liability to any Person for the performance or non-performance of any obligation by any other Purchaser hereunder.

       

      

    

    
      
        

      
        	
                The York Water Company

              	
                Note Purchase Agreement

              

      

    

    
    
       

      
         

         

        Section 3.          Closing.

      

       

      The sale and purchase of the Notes to be purchased by each Purchaser shall occur at the offices of Chapman and Cutler LLP, 111 West Monroe Street, Chicago, Illinois 60603, at 8:00 a.m., Chicago
        time, at a closing (the “Closing”) on September 30, 2020.  At the Closing the Company will deliver to each Purchaser the Notes to be purchased by such Purchaser in the form of a single Note (or such greater
        number of Notes in denominations of at least $100,000 as such Purchaser may request) dated the date of the Closing and registered in such Purchaser’s name (or in the name of its nominee), against delivery by such Purchaser to the Company or its
        order of immediately available funds in the amount of the purchase price therefor by wire transfer of immediately available funds for the account of the Company account number XXXXXXXXXX at XXXXXXXXXXXXXXXXX, ABA Number XXXXXXXXX.  If at the Closing the Company shall fail to tender such Notes to any Purchaser as provided above in this Section 3, or any of the conditions specified in Section 4 shall not have been fulfilled to such
        Purchaser’s satisfaction, such Purchaser shall, at its election, be relieved of all further obligations under this Agreement, without thereby waiving any rights such Purchaser may have by reason of such failure by the Company to tender such Notes
        or any of the conditions specified in Section 4 not having been fulfilled to such Purchaser’s satisfaction.

       

      Section 4.          Conditions

            to Closing.

       

      Each Purchaser’s obligation to purchase and pay for the Notes to be sold to such Purchaser at the Closing is subject to the fulfillment to such Purchaser’s satisfaction, prior to or at the Closing,
        of the following conditions:

       

      Section 4.1.          Representations and Warranties. 

          The representations and warranties of the Company in this Agreement shall be correct when made and at the Closing.

       

      Section 4.2.          Performance; No Default.  The Company shall have performed and complied with all agreements and conditions contained in this Agreement required to be performed or complied with by it prior to or at the Closing.  Before and after
          giving effect to the issue and sale of the Notes (and the application of the proceeds thereof as contemplated by Section 5.14), no Default or Event of Default shall have occurred and be continuing.

       

      Section 4.3.          Compliance Certificates.

       

      (a)     Officer’s Certificate.  The Company shall have delivered to such Purchaser an Officer’s Certificate, dated the date of the Closing, certifying that
        the conditions specified in Sections 4.1, 4.2 and 4.9 have been fulfilled.

       

      (b)     Secretary’s Certificate.  The Company shall have delivered to such Purchaser a certificate of its Secretary or Assistant Secretary, dated the date
        of the Closing, certifying as to (i) the resolutions attached thereto and other corporate proceedings relating to the authorization, execution and delivery of the Notes and this Agreement and (ii) the Company’s organizational documents as then in
        effect.

       

      

      
        - 2 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

       

        Section 4.4.          Opinions of Counsel.  Such Purchaser shall have received opinions in form and substance
        satisfactory to such Purchaser, dated the date of the Closing (a) from Reed Smith LLP, counsel for the Company, covering the matters set forth in Schedule 4.4(a) and covering such other matters incident to the transactions contemplated hereby as
        such Purchaser or its counsel may reasonably request (and the Company hereby instructs its counsel to deliver such opinion to the Purchasers) and (b) from Chapman and Cutler LLP, the Purchasers’ special counsel in connection with such transactions,
        substantially in the form set forth in Schedule 4.4(b) and covering such other matters incident to such transactions as such Purchaser may reasonably request.

       

      Section 4.5.         Purchase Permitted By Applicable Law,
            Etc.  On the date of the Closing such Purchaser’s purchase of Notes shall (a) be permitted by the laws and regulations of each jurisdiction to which such Purchaser is subject, without recourse to provisions (such as section 1405(a)(8) of
          the New York Insurance Law) permitting limited investments by insurance companies without restriction as to the character of the particular investment, (b) not violate any applicable law or regulation (including Regulation T, U or X of the Board
          of Governors of the Federal Reserve System) and (c) not subject such Purchaser to any tax, penalty or liability under or pursuant to any applicable law or regulation, which law or regulation was not in effect on the date hereof.  If requested by
          such Purchaser, such Purchaser shall have received an Officer’s Certificate certifying as to such matters of fact as such Purchaser may reasonably specify to enable such Purchaser to determine whether such purchase is so permitted.

       

      Section 4.6.          Sale of Other Notes. 
          Contemporaneously with the Closing the Company shall sell to each other Purchaser and each other Purchaser shall purchase the Notes to be purchased by it at the Closing as specified in the Purchaser Schedule.

       

      Section 4.7.         Payment of Special Counsel Fees. 

          Without limiting Section 15.1, the Company shall have paid on or before the Closing the fees, charges and disbursements of the Purchasers’ special counsel referred to in Section 4.4 to the extent reflected in a statement of such counsel rendered
          to the Company at least one Business Day prior to the Closing.

       

      
        
          Section 4.8.          Private Placement Number.  A Private Placement Number issued by Standard & Poor’s CUSIP Service Bureau (in cooperation with the SVO) shall have been obtained for the Notes.

        

      

       

      Section 4.9.          Changes in Corporate Structure. 

          The Company shall not have changed its jurisdiction of incorporation or organization, as applicable, or been a party to any merger or consolidation or succeeded to all or any substantial part of the liabilities of any other entity, at any time
          following the date of the most recent financial statements referred to in Schedule 5.5.  

       

      Section 4.10.       Funding Instructions.  At least
          five Business Days prior to the date of the Closing, each Purchaser shall have received written instructions signed by a Responsible Officer on letterhead of the Company confirming the information specified in Section 3 including (i) the name and
          address of the transferee bank, (ii) such transferee bank’s ABA number and (iii) the account name and number into which the purchase price for the Notes is to be deposited.  Each Purchaser has the right, but not the obligation, upon written
          notice (which may be by email) to the Issuer, to elect to deliver a micro deposit (less than $50.00) to the account identified in the written instructions no later than two (2) Business Days prior to Closing.  If a Purchaser delivers a micro
          deposit, a Responsible Officer must verbally verify the receipt and amount of the micro deposit to such Purchaser on a telephone call initiated by such Purchaser prior to Closing.  The Company shall not be obligated to return the amount of the
          micro deposit, nor will the amount of the micro deposit be netted against the Purchaser’s purchase price of the Notes.

       

      

      
        - 3 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      Section 4.11.        Commission Approval.  The
          Pennsylvania Public Utility Commission shall have entered an appropriate order authorizing the issuance and sale of the Notes upon terms not inconsistent with this Agreement and the Notes and such order shall not be the subject of a pending
          appeal.  

       

      Section 4.12.       Consent of Holders of Other Securities. 

          On or prior to the Closing, any consents or approvals required to be obtained from any holder or holders of any outstanding Security of the Company and any amendments of agreements pursuant to which any Securities may have been issued which shall
          be necessary to permit the consummation of the transactions contemplated hereby shall have been obtained and all such consents or amendments shall be satisfactory in form and substance to you and your special counsel.

       

      Section 4.13.       Proceedings and Documents.  All
          corporate and other proceedings in connection with the transactions contemplated by this Agreement and all documents and instruments incident to such transactions shall be satisfactory to such Purchaser and its special counsel, and such Purchaser
          and its special counsel shall have received all such counterpart originals or certified or other copies of such documents as such Purchaser or such special counsel may reasonably request.

       

      Section 5.          Representations

            and Warranties of the Company.

       

      The Company represents and warrants to each Purchaser that:

       

      Section 5.1.        Organization; Power and Authority. 

          The Company is a corporation duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation, and is duly qualified as a foreign corporation and is in good standing in each jurisdiction in which such
          qualification is required by law, other than those jurisdictions as to which the failure to be so qualified or in good standing would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.  The Company
          has the corporate power and authority to own or hold under lease the properties it purports to own or hold under lease, to transact the business it transacts and proposes to transact, to execute and deliver this Agreement and the Notes and to
          perform the provisions hereof and thereof.

       

      Section 5.2.         Authorization, Etc.  This
          Agreement and the Notes have been duly authorized by all necessary corporate action on the part of the Company, and this Agreement constitutes, and upon execution and delivery thereof each Note will constitute, a legal, valid and binding
          obligation of the Company enforceable against the Company in accordance with its terms, except as such enforceability may be limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the
          enforcement of creditors’ rights generally and (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

       

      

      
        - 4 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      Section 5.3.         Disclosure.  The Company,
          through its agent, Janney Montgomery Scott LLC, has delivered to each Purchaser a copy of a Private Placement Investor Presentation, dated September 2020 (the “Presentation”), relating to the transactions
          contemplated hereby.  This Agreement, the Presentation, the financial statements listed in Schedule 5.5 and the documents, certificates or other writings delivered to the Purchasers by or on behalf of the Company prior to September 18, 2020 in
          connection with the transactions contemplated hereby and identified in Schedule 5.3 (this Agreement, the Presentation and such documents, certificates or other writings and such financial statements delivered to each Purchaser being referred to,
          collectively, as the “Disclosure Documents”), taken as a whole, do not contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein not
          misleading in light of the circumstances under which they were made.  Except as disclosed in the Disclosure Documents, since December 31, 2019, there has been no change in the financial condition, operations, business or properties of the Company
          except changes that would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

       

      Section 5.4.       Organization and Ownership of Shares of
            Subsidiaries; Affiliates.  Schedule 5.4 contains (except as noted therein) complete and correct lists of (i) the Company’s Affiliates, and (ii) the Company’s directors and senior officers.  The Company has no Subsidiaries.

       

      Section 5.5.          Financial Statements; Material
            Liabilities.  The Company has delivered to each Purchaser copies of the financial statements of the Company listed on Schedule 5.5.  All of such financial statements (including in each case the related schedules and notes) fairly present
          in all material respects the financial position of the Company as of the respective dates specified in such Schedule and the results of its operations and cash flows for the respective periods so specified and have been prepared in accordance
          with GAAP consistently applied throughout the periods involved except as set forth in the notes thereto (subject, in the case of any interim financial statements, to normal year-end adjustments).  The Company does not have any Material
          liabilities that are not disclosed in the Disclosure Documents.

       

      Section 5.6.         Compliance with Laws, Other
            Instruments, Etc.  The execution, delivery and performance by the Company of this Agreement and the Notes will not (i) contravene, result in any breach of, or constitute a default under, or result in the creation of any Lien in respect
          of any property of the Company under, any indenture, mortgage, deed of trust, loan, purchase or credit agreement, lease, corporate charter, regulations or by‐laws, shareholders agreement or any other agreement or instrument to which the Company
          is bound or by which the Company or any of its properties may be bound or affected, (ii) conflict with or result in a breach of any of the terms, conditions or provisions of any order, judgment, decree or ruling of any court, arbitrator or
          Governmental Authority applicable to the Company or (iii) violate any provision of any statute or other rule or regulation of any Governmental Authority applicable to the Company. 

       

      Section 5.7.         Governmental Authorizations, Etc. 

          No consent, approval or authorization of, or registration, filing or declaration with, any Governmental Authority is required in connection with the execution, delivery or performance by the Company of this Agreement or the Notes, other than the
          authorization of the Pennsylvania Public Utility Commission, which authorization has been duly obtained pursuant to an order of the Commission which is in full force and effect, has not been revoked or amended, is not the subject of a pending
          appeal and is legally sufficient to authorize the offer, issuance, sale and delivery of the Notes and the execution, delivery and performance of this Agreement by the Company.

       

      

      
        - 5 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      Section 5.8.         Litigation; Observance of Statutes
            and Orders.  (a) There are no actions, suits, investigations or proceedings pending or, to the best knowledge of the Company, threatened against or affecting the Company or any property of the Company in any court or before any
          arbitrator of any kind or before or by any Governmental Authority that would, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

       

      (b)    The Company is not (i) in violation of any order, judgment, decree or ruling of any court, any arbitrator of any kind or any Governmental Authority or (ii) in violation of any applicable
        law, ordinance, rule or regulation of any Governmental Authority (including Environmental Laws, the USA PATRIOT Act or any of the other laws and regulations that are referred to in Section 5.16), which violation would, individually or in the
        aggregate, reasonably be expected to have a Material Adverse Effect.

       

      Section 5.9.        Taxes.  The Company has filed
          all tax returns that are required to have been filed in any jurisdiction, and have paid all taxes shown to be due and payable on such returns and all other taxes and assessments payable by them, to the extent such taxes and assessments have
          become due and payable and before they have become delinquent, except for any taxes and assessments (i) the amount of which, individually or in the aggregate, is not Material or (ii) the amount, applicability or validity of which is currently
          being contested in good faith by appropriate proceedings and with respect to which the Company has established adequate reserves in accordance with GAAP.  The charges, accruals and reserves on the books of the Company in respect of U.S. federal,
          state or other taxes for all fiscal periods are adequate.  The U.S. federal income tax liabilities of the Company has been finally determined (whether by reason of completed audits or the statute of limitations having run) for all fiscal years up
          to and including the fiscal year ended December 31, 2015.  

       

      Section 5.10.        Title to Property; Leases. 
          The Company has good and sufficient title to its Material properties, including all such properties reflected in the most recent audited balance sheet referred to in Section 5.5 or purported to have been acquired by the Company after such date
          (except as sold or otherwise disposed of in the ordinary course of business), in each case free and clear of Liens prohibited by this Agreement, except for those defects in title and Liens that, individually or in the aggregate, would not
          reasonably be expected to have a Material Adverse Effect.  All Material leases are valid and subsisting and are in full force and effect in all material respects. 

       

      Section 5.11.        Licenses, Permits, Etc.  The
          Company owns or possesses all licenses, permits, franchises, authorizations, patents, copyrights, proprietary software, service marks, trademarks and trade names, or rights thereto, that individually or in the aggregate are Material, without
          known conflict with the rights of others, except for those conflicts that, individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect.

       

      

      
        - 6 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      Section 5.12.       Compliance with Employee Benefit Plans. 

          (a) The Company and each ERISA Affiliate have operated and administered each Plan in compliance with all applicable laws except for such instances of noncompliance as have not resulted in and would not, individually or in the aggregate,
          reasonably be expected to result in a Material Adverse Effect.  Neither the Company nor any ERISA Affiliate has incurred any liability pursuant to Title I or IV of ERISA or the penalty or excise tax provisions of the Code relating to employee
          benefit plans (as defined in section 3 of ERISA), and no event, transaction or condition has occurred or exists that would, individually or in the aggregate, reasonably be expected to result in the incurrence of any such liability by the Company
          or any ERISA Affiliate, or in the imposition of any Lien on any of the rights, properties or assets of the Company or any ERISA Affiliate, in either case pursuant to Title I or IV of ERISA or to section 430(k) of the Code or to any such penalty
          or excise tax provisions under the Code or federal law or section 4068 of ERISA or by the granting of a security interest in connection with the amendment of a Plan, other than such liabilities or Liens as would not reasonably be expected to be
          individually or in the aggregate Material.

       

      (b)    The present value of the aggregate benefit liabilities under each of the Plans (other than Multiemployer Plans), determined as of the end of such Plan’s most recently ended plan year on the
        basis of the actuarial assumptions specified for funding purposes in such Plan’s most recent actuarial valuation report, did not exceed the aggregate current value of the assets of such Plan allocable to such benefit liabilities by more than
        $5,000,000 in the case of any single Plan and by more than $10,000,000 in the aggregate for all Plans.  The term “benefit liabilities” has the meaning specified in section 4001 of ERISA and the terms “current value” and “present value” have the meaning specified in section 3 of ERISA. 

       

      (c)    The Company and its ERISA Affiliates have not incurred withdrawal liabilities (and are not subject to contingent withdrawal liabilities) under section 4201 or 4204 of ERISA in respect of
        Multiemployer Plans that individually or in the aggregate are Material.

       

      (d)     The expected postretirement benefit obligation (determined as of the last day of the Company’s most recently ended fiscal year in accordance with Financial Accounting Standards Board
        Accounting Standards Codification Topic 715-60, without regard to liabilities attributable to continuation coverage mandated by section 4980B of the Code) of the Company is not Material.

       

      (e)     The execution and delivery of this Agreement and the issuance and sale of the Notes hereunder will not involve any transaction that is subject to the prohibitions of section 406 of ERISA or
        in connection with which a tax could be imposed pursuant to section 4975(c)(1)(A)-(D) of the Code.  The representation by the Company to each Purchaser in the first sentence of this Section 5.12(e) is made in reliance upon and subject to the
        accuracy of such Purchaser’s representation in Section 6.2 as to the sources of the funds to be used to pay the purchase price of the Notes to be purchased by such Purchaser.

       

      (f)      The Company does not have any Non-U.S. Plans.

       

      Section 5.13.        Private Offering by the Company. 

          Neither the Company nor anyone acting on its behalf has offered the Notes or any similar Securities for sale to, or solicited any offer to buy the Notes or any similar Securities from, or otherwise approached or negotiated in respect thereof
          with, any Person other than not more than nine (9) offerees (including the Purchasers), each of which has been offered the Notes at a private sale for investment.  Neither the Company nor anyone acting on its behalf has taken, or will take, any
          action that would subject the issuance or sale of the Notes to the registration requirements of section 5 of the Securities Act or to the registration requirements of any Securities or blue sky laws of any applicable jurisdiction.

       

      

      
        - 7 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      Section 5.14.       Use of Proceeds; Margin Regulations. 

          The Company will apply the proceeds of the sale of the Notes hereunder to repay existing Indebtedness, finance various capital projects and for general corporate purposes.  No part of the proceeds
          from the sale of the Notes hereunder will be used, directly or indirectly, for the purpose of buying or carrying any margin stock within the meaning of Regulation U of the Board of Governors of the Federal Reserve System (12 CFR 221), or for the
          purpose of buying or carrying or trading in any Securities under such circumstances as to involve the Company in a violation of Regulation X of said Board (12 CFR 224) or to involve any broker or dealer in a violation of Regulation T of said
          Board (12 CFR 220).  The Company does not own any margin stock and the Company does not have any present intention that margin stock will constitute more than 10% the value of its consolidated assets.  As used in this Section, the terms “margin stock” and “purpose of buying or carrying” shall have the meanings assigned to them in said Regulation U.

       

      Section 5.15.        Existing Indebtedness.   (a)
          Except as described therein, Schedule 5.15 sets forth a complete and correct list of all outstanding Indebtedness of the Company as of June 30, 2020 (including descriptions of the obligors and obligees, principal amounts outstanding, any
          collateral therefor and any Guaranty thereof), since which date there has been no Material change in the amounts, interest rates, sinking funds, installment payments or maturities of the Indebtedness of the Company.  The Company is not in default
          and no waiver of default is currently in effect, in the payment of any principal or interest on any Indebtedness of the Company and no event or condition exists with respect to any Indebtedness of the Company the outstanding principal amount of
          which exceeds $5,000,000 that would permit (or that with notice or the lapse of time, or both, would permit) one or more Persons to cause such Indebtedness to become due and payable before its stated maturity or before its regularly scheduled
          dates of payment.

       

      (b)    The Company is not a party to, or otherwise subject to any provision contained in, any instrument evidencing Indebtedness of the Company, any agreement relating thereto or any other
        agreement (including its charter or any other organizational document) which limits the amount of, or otherwise imposes restrictions on the incurring of, Indebtedness of the Company, other than items of Indebtedness listed in Schedule 5.15.

       

      Section 5.16.        Foreign Assets Control Regulations,
            Etc.  (a) Neither the Company nor any Controlled Entity (i) is a Blocked Person, (ii) has been notified that its name appears or may in the future appear on a State Sanctions List or (iii) is a target of sanctions that have been imposed
          by the United Nations or the European Union.

       

      (b)    Neither the Company nor any Controlled Entity (i) has violated, been found in violation of, or been charged or convicted under, any applicable U.S. Economic Sanctions Laws, Anti-Money
        Laundering Laws or Anti-Corruption Laws or (ii) to the Company’s knowledge, is under investigation by any Governmental Authority for possible violation of any U.S. Economic Sanctions Laws, Anti-Money Laundering Laws or Anti-Corruption Laws.

       

      (c)     No part of the proceeds from the sale of the Notes hereunder:

       

      

      
        - 8 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      (i)     constitutes or will constitute funds obtained on behalf of any Blocked Person or will otherwise be used by the Company or any Controlled Entity, directly or indirectly,
        (A) in connection with any investment in, or any transactions or dealings with, any Blocked Person, (B) for any purpose that would cause any Purchaser to be in violation of any U.S. Economic Sanctions Laws or (C) otherwise in violation of any U.S.
        Economic Sanctions Laws;

       

      (ii)     will be used, directly or indirectly, in violation of, or cause any Purchaser to be in violation of, any applicable Anti-Money Laundering Laws; or

       

      (iii)     will be used, directly or indirectly, for the purpose of making any improper payments, including bribes, to any Governmental Official or commercial counterparty in
        order to obtain, retain or direct business or obtain any improper advantage, in each case which would be in violation of, or cause any Purchaser to be in violation of, any applicable Anti-Corruption Laws.

       

      (d)         The Company has established procedures and controls which it reasonably believes are adequate (and otherwise comply with applicable law) to ensure that the Company and each Controlled
        Entity is and will continue to be in compliance with all applicable U.S. Economic Sanctions Laws, Anti-Money Laundering Laws and Anti-Corruption Laws. 

       

      Section 5.17.        Status under Certain Statutes. 

          The Company is not subject to regulation under the Investment Company Act of 1940, the Public Utility Holding Company Act of 2005, the ICC Termination Act of 1995, or the Federal Power Act.

       

      Section 6.          Representations

            of the Purchasers.

       

      Section 6.1.          Purchase for Investment. 
          Each Purchaser severally represents that (a) it is purchasing the Notes for its own account or for one or more separate accounts maintained by such Purchaser or for the account of one or more pension or trust funds and not with a view to the
          distribution thereof, provided that the disposition of such Purchaser’s or their property shall at all times be within such Purchaser’s or their control and (b) it is an “accredited investor” (as defined in Rule 501(a)(1), (2), (3), or (7) under
          the Securities Act).  Each Purchaser understands that the Notes have not been registered under the Securities Act and may be resold only if registered pursuant to the provisions of the Securities Act or if an exemption from registration is
          available, except under circumstances where neither such registration nor such an exemption is required by law, and that the Company is not required to register the Notes.

       

      Section 6.2.         Source of Funds.  Each
          Purchaser severally represents that at least one of the following statements is an accurate representation as to each source of funds (a “Source”) to be used by such Purchaser to pay the purchase price of
          the Notes to be purchased by such Purchaser hereunder:

       

      

      
        - 9 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      (a)      the Source is an “insurance company general account” (as the term is defined in the United States Department of Labor’s Prohibited Transaction Exemption (“PTE”) 95-60) in respect of which the reserves and liabilities (as defined by the annual statement for life insurance companies approved by the NAIC (the “NAIC Annual Statement”))

        for the general account contract(s) held by or on behalf of any employee benefit plan together with the amount of the reserves and liabilities for the general account contract(s) held by or on behalf of any other employee benefit plans maintained
        by the same employer (or affiliate thereof as defined in PTE 95-60) or by the same employee organization in the general account do not exceed 10% of the total reserves and liabilities of the general account (exclusive of separate account
        liabilities) plus surplus as set forth in the NAIC Annual Statement filed with such Purchaser’s state of domicile; or

       

      (b)     the Source is a separate account that is maintained solely in connection with such Purchaser’s fixed contractual obligations under which the amounts payable, or credited,
        to any employee benefit plan (or its related trust) that has any interest in such separate account (or to any participant or beneficiary of such plan (including any annuitant)) are not affected in any manner by the investment performance of the
        separate account; or

       

      (c)      the Source is either (i) an insurance company pooled separate account, within the meaning of PTE 90-1 or (ii) a bank collective investment fund, within the meaning of
        the PTE 91-38 and, except as disclosed by such Purchaser to the Company in writing pursuant to this clause (c), no employee benefit plan or group of plans maintained by the same employer or employee organization beneficially owns more than 10% of
        all assets allocated to such pooled separate account or collective investment fund; or

       

      (d)     the Source constitutes assets of an “investment fund” (within the meaning of Part VI of PTE 84-14 (the “QPAM Exemption”)) managed
        by a “qualified professional asset manager” or “QPAM” (within the meaning of Part VI of the QPAM Exemption), no employee benefit plan’s assets that are managed by the QPAM in such investment fund, when combined with the assets of all other employee
        benefit plans established or maintained by the same employer or by an affiliate (within the meaning of Part VI(c)(1) of the QPAM Exemption) of such employer or by the same employee organization and managed by such QPAM, represent more than 20% of
        the total client assets managed by such QPAM, the conditions of Part I(c) and (g) of the QPAM Exemption are satisfied, neither the QPAM nor a person controlling or controlled by the QPAM maintains an ownership interest in the Company that would
        cause the QPAM and the Company to be “related” within the meaning of Part VI(h) of the QPAM Exemption and (i) the identity of such QPAM and (ii) the names of any employee benefit plans whose assets in the investment fund, when combined with the
        assets of all other employee benefit plans established or maintained by the same employer or by an affiliate (within the meaning of Part VI(c)(1) of the QPAM Exemption) of such employer or by the same employee organization, represent 10% or more of
        the assets of such investment fund, have been disclosed to the Company in writing pursuant to this clause (d); or

       

      (e)      the Source constitutes assets of a “plan(s)” (within the meaning of Part IV(h) of PTE 96-23 (the “INHAM Exemption”)) managed by
        an “in-house asset manager” or “INHAM” (within the meaning of Part IV(a) of the INHAM Exemption), the conditions of Part I(a), (g) and (h) of the INHAM Exemption are satisfied, neither the INHAM nor a person controlling or controlled by the INHAM
        (applying the definition of “control” in Part IV(d)(3) of the INHAM Exemption) owns a 10% or more interest in the Company and (i) the identity of such INHAM and (ii) the name(s) of the employee benefit plan(s) whose assets constitute the Source
        have been disclosed to the Company in writing pursuant to this clause (e); or

       

      

      
        - 10 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      (f)       the Source is a governmental plan; or

       

      (g)      the Source is one or more employee benefit plans, or a separate account or trust fund comprised of one or more employee benefit plans, each of which has been identified
        to the Company in writing pursuant to this clause (g); or

       

      (h)       the Source does not include assets of any employee benefit plan, other than a plan exempt from the coverage of ERISA.

       

      As used in this Section 6.2, the terms “employee benefit plan,” “governmental plan,” and “separate
          account” shall have the respective meanings assigned to such terms in section 3 of ERISA.

       

      Section 7.          Information as to Company.

       

      Section 7.1.          Financial and Business Information. 

          The Company shall deliver to each holder of a Note that is an Institutional Investor:

       

      (a)      Quarterly Statements — within 60 days (or such shorter period as is the earlier of (x) 15 days greater than the period
        applicable to the filing of the Company’s Quarterly Report on Form 10‐Q (the “Form 10‐Q”) with the SEC regardless of whether the Company is subject to the filing requirements thereof and (y) the date by
        which such financial statements are required to be delivered under any Material Credit Facility or the date on which such corresponding financial statements are delivered under any Material Credit Facility if such delivery occurs earlier than such
        required delivery date) after the end of each quarterly fiscal period in each fiscal year of the Company (other than the last quarterly fiscal period of each such fiscal year), duplicate copies of,

       

      (i)       a consolidated balance sheet of the Company and its Subsidiaries as at the end of such quarter, and

       

      (ii)      consolidated statements of income, changes in shareholders’ equity and cash flows of the Company and its Subsidiaries, for such quarter and (in the case of the second
        and third quarters) for the portion of the fiscal year ending with such quarter,

       

      setting forth in each case in comparative form the figures for the corresponding periods in the previous fiscal year, all in reasonable detail, prepared in accordance with GAAP applicable to
        quarterly financial statements generally, and certified by a Senior Financial Officer as fairly presenting, in all material respects, the financial position of the companies being reported on and their results of operations and cash flows, subject
        to changes resulting from year-end adjustments;

       

      

      
        - 11 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      (b)      Annual Statements — within 120 days (or such shorter period as is the earlier of (x) 15 days greater than the period applicable
        to the filing of the Company’s Annual Report on Form 10‐K (the “Form 10‐K”) with the SEC regardless of whether the Company is subject to the filing requirements thereof and (y) the date by which such
        financial statements are required to be delivered under any Material Credit Facility or the date on which such corresponding financial statements are delivered under any Material Credit Facility if such delivery occurs earlier than such required
        delivery date) after the end of each fiscal year of the Company, duplicate copies of

       

      (i)        a consolidated balance sheet of the Company and its Subsidiaries as at the end of such year, and

       

      (ii)      consolidated statements of income, changes in shareholders’ equity and cash flows of the Company and its Subsidiaries for such year,

       

      setting forth in each case in comparative form the figures for the previous fiscal year, all in reasonable detail, prepared in accordance with GAAP, and accompanied by an opinion thereon (without a
        “going concern” or similar qualification or exception and without any qualification or exception as to the scope of the audit on which such opinion is based) of independent public accountants of recognized national standing, which opinion shall
        state that such financial statements present fairly, in all material respects, the financial position of the companies being reported upon and their results of operations and cash flows and have been prepared in conformity with GAAP, and that the
        examination of such accountants in connection with such financial statements has been made in accordance with generally accepted auditing standards, and that such audit provides a reasonable basis for such opinion in the circumstances;

       

      (c)     SEC and Other Reports — promptly upon their becoming available, one copy of (i) each financial statement, report, notice, proxy
        statement or similar document sent by the Company or any Subsidiary (x) to its creditors under any Material Credit Facility (excluding information sent to such creditors in the ordinary course of administration of a credit facility, such as
        information relating to pricing and borrowing availability) or (y) to its public Securities holders generally, and (ii) each regular or periodic report, each registration statement (without exhibits except as expressly requested by such holder),
        and each prospectus and all amendments thereto filed by the Company or any Subsidiary with the SEC; 

       

      (d)     Notice of Default or Event of Default — promptly, and in any event within 5 days after a Responsible Officer becoming aware of
        the existence of any Default or Event of Default, a written notice specifying the nature and period of existence thereof and what action the Company is taking or proposes to take with respect thereto;

       

      (e)     Employee Benefits Matters — promptly, and in any event within 5 days after a Responsible Officer becoming aware of any of the
        following, a written notice setting forth the nature thereof and the action, if any, that the Company or an ERISA Affiliate proposes to take with respect thereto:

       

      

      
        - 12 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      (i)       with respect to any Plan, any reportable event, as defined in section 4043(c) of ERISA and the regulations thereunder, for which notice thereof has not been waived
        pursuant to such regulations as in effect on the date hereof;

       

      (ii)      the taking by the PBGC of steps to institute, or the threatening by the PBGC of the institution of, proceedings under section 4042 of ERISA for the termination of, or
        the appointment of a trustee to administer, any Plan, or the receipt by the Company or any ERISA Affiliate of a notice from a Multiemployer Plan that such action has been taken by the PBGC with respect to such Multiemployer Plan;

       

      (iii)      any event, transaction or condition that could result in the incurrence of any liability by the Company or any ERISA Affili-ate pursuant to Title I or IV of ERISA or
        the penalty or excise tax provisions of the Code relating to employee benefit plans, or in the imposition of any Lien on any of the rights, properties or assets of the Company or any ERISA Affiliate pursuant to Title I or IV of ERISA or such
        penalty or excise tax provisions, if such liability or Lien, taken together with any other such liabilities or Liens then existing, would reasonably be expected to have a Material Adverse Effect; or

       

      (iv)      receipt of notice of the imposition of a Material financial penalty (which for this purpose shall mean any tax, penalty or other liability, whether by way of indemnity
        or otherwise) with respect to one or more Non-U.S. Plans;

       

      (f)       Resignation or Replacement of Auditors — within 10 days following the date on which the Company’s auditors resign or the
        Company elects to change auditors, as the case may be, notification thereof, together with such further information as the Required Holders may request; and

       

      (g)      Requested Information — with reasonable promptness, such other data and information relating to the business, operations,
        affairs, financial condition, assets or properties of the Company or any of its Subsidiaries (including actual copies of the Company’s Form 10‐Q and Form 10‐K) or relating to the ability of the Company to perform its obligations hereunder and under
        the Notes as from time to time may be reasonably requested by any such holder of a Note.

       

      Section 7.2.          Officer’s Certificate.  Each
          set of financial statements delivered to a holder of a Note pursuant to Section 7.1(a) or Section 7.1(b) shall be accompanied by a certificate of a Senior Financial Officer:

       

      (a)      Covenant Compliance — setting forth the information from such financial statements that is required in order to establish
        whether the Company was in compliance with the requirements of Section 10 during the quarterly or annual period covered by the financial statements then being furnished (including with respect to each such provision that involves mathematical
        calculations, the information from such financial statements that is required to perform such calculations) and detailed calculations of the maximum or minimum amount, ratio or percentage, as the case may be, permissible under the terms of such
        Section, and the calculation of the amount, ratio or percentage then in existence.  In the event that the Company or any Subsidiary has made an election to measure any financial liability using fair value (which election is being disregarded for
        purposes of determining compliance with this Agreement pursuant to Section 22.2) as to the period covered by any such financial statement, such Senior Financial Officer’s certificate as to such period shall include a reconciliation from GAAP with
        respect to such election; 

       

      

      
        - 13 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      (b)      Event of Default — certifying that such Senior Financial Officer has reviewed the relevant terms hereof and has made, or caused
        to be made, under his or her supervision, a review of the transactions and conditions of the Company and its Subsidiaries from the beginning of the quarterly or annual period covered by the statements then being furnished to the date of the
        certificate and that such review shall not have disclosed the existence during such period of any condition or event that constitutes a Default or an Event of Default or, if any such condition or event existed or exists, specifying the nature and
        period of existence thereof and what action the Company shall have taken or proposes to take with respect thereto; and

       

      (c)      Subsidiary Guarantors – setting forth a list of all Subsidiaries that are Subsidiary
        Guarantors and certifying that each Subsidiary that is required to be a Subsidiary Guarantor pursuant to Section 9.7 is a Subsidiary Guarantor, in each case, as of the date of such certificate of Senior Financial Officer.

       

      

      Section 7.3.         Visitation.  The Company shall permit the representatives of each holder of a Note that is an
        Institutional Investor:

       

      (a)      No Default — if no Default or Event of Default then exists, at the expense of such holder and upon reasonable prior notice to
        the Company, to visit the principal executive office of the Company, to discuss the affairs, finances and accounts of the Company and its Subsidiaries with the Company’s officers, and (with the consent of the Company, which consent will not be
        unreasonably withheld) to visit the other offices and properties of the Company and each Subsidiary, all at such reasonable times and as often as may be reasonably requested in writing; and

       

      (b)      Default — if a Default or Event of Default then exists, at the expense of the Company to visit and inspect any of the offices
        or properties of the Company or any Subsidiary, to examine all their respective books of account, records, reports and other papers, to make copies and extracts therefrom, and to discuss their respective affairs, finances and accounts with their
        respective officers and independent public accountants (and by this provision the Company authorizes said accountants to discuss the affairs, finances and accounts of the Company and its Subsidiaries), all at such times and as often as may be
        requested.

       

      Section 7.4.         Electronic Delivery. 
          Financial statements, opinions of independent certified public accountants, other information and Officer’s Certificates that are required to be delivered by the Company pursuant to Sections 7.1(a), (b) or (c) and Section 7.2 shall be deemed to
          have been delivered if the Company satisfies any of the following requirements with respect thereto:

       

      

      
        - 14 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      (a)      such financial statements satisfying the requirements of Section 7.1(a) or (b) and related Officer’s Certificate satisfying the requirements of Section 7.2 and any other
        information required under Section 7.1(c) are delivered to each holder of a Note by e-mail at the e-mail address set forth in such holder’s Purchaser Schedule or as communicated from time to time in a separate writing delivered to the Company; 

       

      (b)      the Company shall have timely filed such Form 10–Q or Form 10–K, satisfying the requirements of Section 7.1(a) or Section 7.1(b), as the case may be, with the SEC on
        EDGAR and shall have made such form and the related Officer’s Certificate satisfying the requirements of Section 7.2 available on its home page on the internet, which is located at http://www.yorkwater.com as of the date of this Agreement; 

       

      (c)      such financial statements satisfying the requirements of Section 7.1(a) or Section 7.1(b) and related Officer’s Certificate(s) satisfying the requirements of Section 7.2
        and any other information required under Section 7.1(c) are timely posted by or on behalf of the Company on IntraLinks or on any other similar website to which each holder of Notes has free access; or 

       

      (d)      the Company shall have timely filed any of the items referred to in Section 7.1(c) with the SEC on EDGAR and shall have made such items available on its home page on the
        internet or on IntraLinks or on any other similar website to which each holder of Notes has free access;

       

      provided however, that in no case shall access to such financial statements, other information and Officer’s
          Certificates be conditioned upon any waiver or other agreement or consent (other than confidentiality provisions consistent with Section 20 of this Agreement); provided further, that in the case of any of
          clauses (b), (c) or (d), the Company shall have given each holder of a Note prior written notice, which may be by e-mail or in accordance with Section 18, of such posting or filing in connection with each delivery, provided further, that upon request of any holder to receive paper copies of such forms, financial statements, other information and Officer’s Certificates or to receive them by e-mail, the Company will promptly e-mail them or
          deliver such paper copies, as the case may be, to such holder.

       

      Section 8.          Payment
            and Prepayment of the Notes.

       

      Section 8.1.          Maturity.  As provided
          therein, the entire unpaid principal balance of each Note shall be due and payable on the Maturity Date thereof.

       

      

      
        - 15 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      Section 8.2.         Optional Prepayments with Make-Whole
            Amount.  The Company may, at its option, upon notice as provided below, prepay at any time all, or from time to time any part of, the Notes, in an amount not less than 5% of the aggregate principal amount of the Notes then outstanding in
          the case of a partial prepayment, at 100% of the principal amount so prepaid, and the Make-Whole Amount determined for the prepayment date with respect to such principal amount; provided, that at any time
          on or after March 30, 2050 the Company may, at its option, upon notice as provided below, prepay all or any part of the Notes at 100% of the principal amount so prepaid, together with accrued interest to the prepayment date.  The Company will
          give each holder of Notes written notice of each optional prepayment under this Section 8.2 not less than 10 days and not more than 60 days prior to the date fixed for such prepayment unless the Company and the Required Holders agree to another
          time period pursuant to Section 17.  Each such notice shall specify such date (which shall be a Business Day), the aggregate principal amount of the Notes to be prepaid on such date, the principal amount of each Note held by such holder to be
          prepaid (determined in accordance with Section 8.3), and the interest to be paid on the prepayment date with respect to such principal amount being prepaid, and shall be accompanied by a certificate of a Senior Financial Officer as to the
          estimated Make-Whole Amount due in connection with such prepayment (calculated as if the date of such notice were the date of the prepayment), setting forth the details of such computation.  Two Business Days prior to such prepayment, the Company
          shall deliver to each holder of Notes a certificate of a Senior Financial Officer specifying the calculation of such Make-Whole Amount as of the specified prepayment date.

       

      Section 8.3.        Allocation of Partial Prepayments. 

          In the case of each partial prepayment of the Notes pursuant to Section 8.2, the principal amount of the Notes to be prepaid shall be allocated among all of the Notes at the time outstanding in proportion, as nearly as practicable, to the
          respective unpaid principal amounts thereof not theretofore called for prepayment.

       

      Section 8.4.         Maturity; Surrender, Etc.            In the case of each prepayment of Notes pursuant to this Section 8, the principal amount of each Note to be prepaid shall mature and become due and payable on the date fixed for such prepayment,
          together with interest on such principal amount accrued to such date and the applicable Make-Whole Amount, if any.  From and after such date, unless the Company shall fail to pay such principal amount when so due and payable, together with the
          interest and Make-Whole Amount, if any, as aforesaid, interest on such principal amount shall cease to accrue.  Any Note paid or prepaid in full shall be surrendered to the Company and cancelled and shall not be reissued, and no Note shall be
          issued in lieu of any prepaid principal amount of any Note.

       

      Section 8.5.          Purchase of Notes.  The
          Company will not and will not permit any Affiliate to purchase, redeem, prepay or otherwise acquire, directly or indirectly, any of the outstanding Notes except (a) upon the payment or prepayment of the Notes in accordance with this Agreement and
          the Notes or (b) pursuant to an offer to purchase made by the Company or an Affiliate pro rata to the holders of all Notes at the time outstanding upon the same terms and conditions.  Any such offer shall provide each holder with sufficient
          information to enable it to make an informed decision with respect to such offer, and shall remain open for at least 15 Business Days.  If the holders of more than 25% of the principal amount of the Notes then outstanding accept such offer, the
          Company shall promptly notify the remaining holders of such fact and the expiration date for the acceptance by holders of Notes of such offer shall be extended by the number of days necessary to give each such remaining holder at least 5 Business
          Days from its receipt of such notice to accept such offer.  The Company will promptly cancel all Notes acquired by it or any Affiliate pursuant to any payment, prepayment or purchase of Notes pursuant to this Agreement and no Notes may be issued
          in substitution or exchange for any such Notes.

       

      

      
        - 16 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      Section 8.6.          Make-Whole Amount.

       

      The term “Make-Whole Amount” means, with respect to any Note, an amount equal to the excess, if any, of the Discounted Value of the Remaining Scheduled
        Payments with respect to the Called Principal of such Note over the amount of such Called Principal, provided that the Make-Whole Amount may in no event be less than zero.  For the purposes of determining
        the Make-Whole Amount, the following terms have the following meanings:

       

      “Called Principal” means, with respect to any Note, the principal of such Note that is to be
          prepaid pursuant to Section 8.2 or has become or is declared to be immediately due and payable pursuant to Section 12.1, as the context requires.

       

      “Discounted Value” means, with respect to the Called Principal of any Note, the amount
          obtained by discounting all Remaining Scheduled Payments with respect to such Called Principal from their respective scheduled due dates to the Settlement Date with respect to such Called Principal, in accordance with accepted financial practice
          and at a discount factor (applied on the same periodic basis as that on which interest on the Notes is payable) equal to the Reinvestment Yield with respect to such Called Principal.

       

      “Reinvestment Yield” means, with respect to the Called Principal of any Note, the sum of (a)
          0.50% plus (b) the yield to maturity implied by the “Ask Yield(s)” reported as of 10:00 a.m. (New York City time) on the second Business Day preceding the Settlement Date with respect to such Called Principal, on the display designated as “Page
          PX1” (or such other display as may replace Page PX1) on Bloomberg Financial Markets for the most recently issued actively traded on-the-run U.S. Treasury securities (“Reported”) having a maturity equal to
          the Remaining Average Life of such Called Principal as of such Settlement Date.  If there are no such U.S. Treasury securities Reported having a maturity equal to such Remaining Average Life, then such implied yield to maturity will be determined
          by (i) converting U.S. Treasury bill quotations to bond equivalent yields in accordance with accepted financial practice and (ii) interpolating linearly between the “Ask Yields” Reported for the applicable most recently issued actively traded
          on-the-run U.S. Treasury securities with the maturities (1) closest to and greater than such Remaining Average Life and (2) closest to and less than such Remaining Average Life.  The Reinvestment Yield shall be rounded to the number of decimal
          places as appears in the interest rate of the applicable Note.  

       

      If such yields are not Reported or the yields Reported as of such time are not ascertainable (including by way of interpolation), then “Reinvestment Yield”
        means, with respect to the Called Principal of any Note, the sum of (x) 0.50% plus (y) the yield to maturity implied by the U.S. Treasury constant maturity yields reported, for the latest day for which such yields have been so reported as of the
        second Business Day preceding the Settlement Date with respect to such Called Principal, in Federal Reserve Statistical Release H.15 (or any comparable successor publication) for the U.S. Treasury constant maturity having a term equal to the
        Remaining Average Life of such Called Principal as of such Settlement Date.  If there is no such U.S. Treasury constant maturity having a term equal to such Remaining Average Life, such implied yield to maturity will be determined by interpolating
        linearly between (1) the U.S. Treasury constant maturity so reported with the term closest to and greater than such Remaining Average Life and (2) the U.S. Treasury constant maturity so reported with the term closest to and less than such Remaining
        Average Life.  The Reinvestment Yield shall be rounded to the number of decimal places as appears in the interest rate of the applicable Note.

       

      

      
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                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      “Remaining Average Life” means, with respect to any Called Principal, the number of years
          obtained by dividing (i) such Called Principal into (ii) the sum of the products obtained by multiplying (a) the principal component of each Remaining Scheduled Payment with respect to such Called Principal by (b) the number of years, computed on
          the basis of a 360-day year comprised of twelve 30-day months and calculated to two decimal places, that will elapse between the Settlement Date with respect to such Called Principal and the scheduled due date of such Remaining Scheduled Payment.

       

      “Remaining Scheduled Payments” means, with respect to the Called Principal of any Note, all
          payments of such Called Principal and interest thereon that would be due after the Settlement Date with respect to such Called Principal if no payment of such Called Principal were made prior to its scheduled due date, provided that if such Settlement Date is not a date on which interest payments are due to be made under the Notes, then the amount of the next succeeding scheduled interest payment will be reduced by the amount of interest
          accrued to such Settlement Date and required to be paid on such Settlement Date pursuant to Section 8.2 or Section 12.1.

       

      “Settlement Date” means, with respect to the Called Principal of any Note, the date on which
          such Called Principal is to be prepaid pursuant to Section 8.2 or has become or is declared to be immediately due and payable pursuant to Section 12.1, as the context requires.

       

      Section 8.7.          Payments Due on Non-Business Days.  Anything in this Agreement or the Notes to the contrary notwithstanding, (x) except as set forth in clause (y), any payment of interest on any Note that is due on a date that is not a Business Day shall be
          made on the next succeeding Business Day without including the additional days elapsed in the computation of the interest payable on such next succeeding Business Day; and (y) any payment of principal of or Make‐Whole Amount on any Note
          (including principal due on the Maturity Date of such Note) that is due on a date that is not a Business Day shall be made on the next succeeding Business Day and shall include the additional days elapsed in the computation of interest payable on
          such next succeeding Business Day.

       

      Section 8.8.          [Reserved]

       

      Section 8.9.          Change in Control.

       

      (a)     Notice of Change in Control or Control Event.  The Company will, within five Business Days after any Responsible Officer has knowledge of the
        occurrence of any Change in Control or Control Event, give written notice of such Change in Control or Control Event to each holder of Notes unless notice in respect of such Change in Control (or the Change in Control contemplated by such Control
        Event) shall have been given pursuant to subparagraph (b) of this Section 8.9.  If a Change in Control has occurred, such notice shall contain and constitute an offer to prepay Notes as described in subparagraph (c) of this Section 8.9 and shall be
        accompanied by the certificate described in subparagraph (g) of this Section 8.9.

       

      

      
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                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      (b)     Condition to Company Action.  The Company will not take any action that consummates or finalizes a Change in Control unless (i) at least 30 days
        prior to such action it shall have given to each holder of Notes written notice containing and constituting an offer to prepay Notes as described in subparagraph (c) of this Section 8.9, accompanied by the certificate described in subparagraph (g)
        of this Section 8.9, and (ii) contemporaneously with such action, it prepays all Notes required to be prepaid in accordance with this Section 8.9.

       

      (c)     Offer to Prepay Notes.  The offer to prepay Notes contemplated by subparagraphs (a) and (b) of this Section 8.9 shall be an offer to prepay, in
        accordance with and subject to this Section 8.9, all, but not less than all, the Notes held by each holder (in this case only, “holder” in respect of any Note registered in the name of a nominee for a
        disclosed beneficial owner shall mean such beneficial owner) on a date specified in such offer (the “Proposed Prepayment Date”).  If such Proposed Prepayment Date is in connection with an offer contemplated
        by subparagraph (a) of this Section 8.9, such date shall be not less than 30 days and not more than 60 days after the date of such offer (if the Proposed Prepayment Date shall not be specified in such offer, the Proposed Prepayment Date shall be
        the first Business Day after the 45th day after the date of such offer).

       

      (d)     Acceptance/Rejection.  A holder of Notes may accept the offer to prepay made pursuant to this Section 8.9 by causing a notice of such acceptance to
        be delivered to the Company not later than 15 days after receipt by such holder of the most recent offer of prepayment.  A failure by a holder of Notes to respond to an offer to prepay made pursuant to this Section 8.9 shall be deemed to constitute
        a rejection of such offer by such holder.

       

      (e)     Prepayment.  Prepayment of the Notes to be prepaid pursuant to this Section 8.9 shall be at 100% of the principal amount of such Notes, together
        with interest on such Notes accrued to the date of prepayment, but without Make‐Whole Amount or other premium.  The prepayment shall be made on the Proposed Prepayment Date except as provided in subparagraph (f) of this Section 8.9.

       

      (f)     Deferral Pending Change in Control.  The obligation of the Company to prepay Notes pursuant to the offers required by subparagraph (c) and accepted
        in accordance with subparagraph (d) of this Section 8.9 is subject to the occurrence of the Change in Control in respect of which such offers and acceptances shall have been made.  In the event that such Change in Control has not occurred on the
        Proposed Prepayment Date in respect thereof, the prepayment shall be deferred until, and shall be made on, the date on which such Change in Control occurs.  The Company shall keep each holder of Notes reasonably and timely informed of (i) any such
        deferral of the date of prepayment, (ii) the date on which such Change in Control and the prepayment are expected to occur, and (iii) any determination by the Company that efforts to effect such Change in Control have ceased or been abandoned (in
        which case the offers and acceptances made pursuant to this Section 8.9 in respect of such Change in Control shall be deemed rescinded).

       

      (g)    Officer’s Certificate.  Each offer to prepay the Notes pursuant to this Section 8.9 shall be accompanied by a certificate, executed by a Senior
        Financial Officer of the Company and dated the date of such offer, specifying:  (i) the Proposed Prepayment Date; (ii) that such offer is made pursuant to this Section 8.9; (iii) the principal amount of each Note offered to be prepaid; (iv) the
        interest that would be due on each Note offered to be prepaid, accrued to the Proposed Prepayment Date; (v) that the conditions of this Section 8.9 have been fulfilled; and (vi) in reasonable detail, the nature and date or proposed date of the
        Change in Control.

       

      

      
        - 19 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      (h)    Certain Definitions.  “Change in Control” shall be deemed to have occurred if any person (as such term is
        used in section 13(d) and section 14(d)(2) of the Exchange Act as in effect on the date of the Closing) or related persons constituting a group (as such term is used in Rule 13d‐5 under the Exchange Act), 

       

      (i)      become the “beneficial owners” (as such term is used in Rule 13d‐3 under the Exchange Act as in effect on the date of the Closing), directly or indirectly, of more than
        50% of the total voting power of all classes then outstanding of the Company’s Voting Stock, or

       

      (ii)     acquire after the date of the Closing (x) the power to elect, appoint or cause the election or appointment of at least a majority of the members of the board of
        directors of the Company, through beneficial ownership of the capital stock of the Company or otherwise, or (y) all or substantially all of the properties and assets of the Company.

       

      “Control Event” means:

       

      (i)      the execution by the Company or any of its Subsidiaries or Affiliates of any agreement or letter of intent with respect to any proposed transaction or event or series of
        transactions or events which, individually or in the aggregate, may reasonably be expected to result in a Change in Control,

       

      (ii)      the execution of any written agreement which, when fully performed by the parties thereto, would result in a Change in Control, or

       

      (iii)     the making of any written offer by any person (as such term is used in section 13(d) and section 14(d)(2) of the Exchange Act as in effect on the date of the Closing)
        or related persons constituting a group (as such term is used in Rule 13d‐5 under the Exchange Act as in effect on the date of the Closing) to the holders of the common stock of the Company, which offer, if accepted by the requisite number of
        holders, would result in a Change in Control.

       

      (i)      All calculations contemplated in this Section 8.9 involving the capital stock of any Person shall be made with the assumption that all convertible Securities of such Person then
        outstanding and all convertible Securities issuable upon the exercise of any warrants, options and other rights outstanding at such time were converted at such time and that all options, warrants and similar rights to acquire shares of capital
        stock of such Person were exercised at such time.

       

      

      
        - 20 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      Section 9.          Affirmative

            Covenants.

       

      The Company covenants that so long as any of the Notes are outstanding:

       

      Section 9.1.         Compliance with Laws.  Without
          limiting Section 10.4, the Company will, and will cause each of its Subsidiaries to, comply with all laws, ordinances or governmental rules or regulations to which each of them is subject (including ERISA, Environmental Laws, the USA PATRIOT Act
          and the other laws and regulations that are referred to in Section 5.16) and will obtain and maintain in effect all licenses, certificates, permits, franchises and other governmental authorizations necessary to the ownership of their respective
          properties or to the conduct of their respective businesses, in each case to the extent necessary to ensure that non-compliance with such laws, ordinances or governmental rules or regulations or failures to obtain or maintain in effect such
          licenses, certificates, permits, franchises and other governmental authorizations would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

       

      Section 9.2.         Insurance.  The Company will,
          and will cause each of its Subsidiaries to, maintain, with financially sound and reputable insurers, insurance with respect to their respective properties and businesses against such casualties and contingencies, of such types, on such terms and
          in such amounts (including deductibles, co-insurance and self-insurance, if adequate reserves are maintained with respect thereto) as is customary in the case of entities of established reputations engaged in the same or a similar business and
          similarly situated.

       

      Section 9.3.          Maintenance of Properties. 
          The Company will, and will cause each of its Subsidiaries to, maintain and keep, or cause to be maintained and kept, their respective properties in good repair, working order and condition (other than ordinary wear and tear), so that the business
          carried on in connection therewith may be properly conducted at all times, provided that this Section 9.3 shall not prevent the Company or any Subsidiary from discontinuing the operation and the
          maintenance of any of its properties if such discontinuance is desirable in the conduct of its business and the Company has concluded that such discontinuance would not, individually or in the aggregate, reasonably be expected to have a Material
          Adverse Effect.

       

      Section 9.4.        Payment of Taxes.  The Company
          will, and will cause each of its Subsidiaries to, file all tax returns required to be filed in any jurisdiction and to pay and discharge all taxes shown to be due and payable on such returns and all other taxes, assessments, governmental charges
          or levies payable by any of them, to the extent the same have become due and payable and before they have become delinquent, provided that neither the Company nor any Subsidiary need pay any such tax,
          assessment, charge or levy if (i) the amount, applicability or validity thereof is contested by the Company or such Subsidiary on a timely basis in good faith and in appropriate proceedings, and the Company or a Subsidiary has established
          adequate reserves therefor in accordance with GAAP on the books of the Company or such Subsidiary or (ii) the nonpayment of all such taxes, assessments, charges and levies would not, individually or in the aggregate, reasonably be expected to
          have a Material Adverse Effect. 

       

      

      
        - 21 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      Section 9.5.         Corporate Existence, Etc. 
          Subject to Section 10.2, the Company will at all times preserve and keep its corporate existence in full force and effect.  Subject to Section 10.2, the Company will at all times preserve and keep in
          full force and effect the corporate existence of each of its Subsidiaries (unless merged into the Company or a Wholly-Owned Subsidiary) and all rights and franchises of the Company and its Subsidiaries unless, in the good faith judgment of the
          Company, the termination of or failure to preserve and keep in full force and effect such corporate existence, right or franchise would not, individually or in the aggregate, have a Material Adverse Effect. 

       

      Section 9.6.         Books and Records.  The
          Company will, and will cause each of its Subsidiaries to, maintain proper books of record and account in conformity with GAAP and all applicable requirements of any Governmental Authority having legal or regulatory jurisdiction over the Company
          or such Subsidiary, as the case may be.  The Company will, and will cause each of its Subsidiaries to, keep books, records and accounts which, in reasonable detail, accurately reflect all transactions and dispositions of assets.  The Company and
          its Subsidiaries have devised a system of internal accounting controls sufficient to provide reasonable assurances that their respective books, records, and accounts accurately reflect all transactions and dispositions of assets and the Company
          will, and will cause each of its Subsidiaries to, continue to maintain such system.

       

      Section 9.7.          Subsidiary Guarantors.  (a)
          The Company will cause each of its Subsidiaries that guarantees or otherwise becomes liable at any time, whether as a borrower or an additional or co-borrower or otherwise, for or in respect of any Indebtedness under any Material Credit Facility
          to concurrently therewith:

       

      (i)          enter into an agreement in form and substance satisfactory to the Required Holders providing for the guaranty by such Subsidiary, on a joint and several basis with all other such
        Subsidiaries, of (x) the prompt payment in full when due of all amounts payable by the Company pursuant to the Notes (whether for principal, interest, Make-Whole Amount or otherwise) and this Agreement, including all indemnities, fees and expenses
        payable by the Company thereunder and (y) the prompt, full and faithful performance, observance and discharge by the Company of each and every covenant, agreement, undertaking and provision required pursuant to the Notes or this Agreement to be
        performed, observed or discharged by it (a “Subsidiary Guaranty”); and 

       

      (ii)         deliver the following to each holder of a Note:

       

      (A)       an executed counterpart of such Subsidiary Guaranty;

       

      (B)      a certificate signed by an authorized responsible officer of such Subsidiary containing representations and warranties on behalf of such Subsidiary to the same effect, mutatis mutandis, as those contained in Sections 5.1, 5.2, 5.6 and 5.7 of this Agreement (but with respect to such Subsidiary and such Subsidiary Guaranty rather than the Company);

       

      (C)       all documents as may be reasonably requested by the Required Holders to evidence the due organization, continuing existence and, where applicable, good standing of such
        Subsidiary and the due authorization by all requisite action on the part of such Subsidiary of the execution and delivery of such Subsidiary Guaranty and the performance by such Subsidiary of its obligations thereunder; and 

       

      

      
        - 22 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      (D)     an opinion of counsel reasonably satisfactory to the Required Holders covering such matters relating to such Subsidiary and such Subsidiary Guaranty as the Required
        Holders may reasonably request.

       

      (b)         At the election of the Company and by written notice to each holder of Notes, any Subsidiary Guarantor that has provided a Subsidiary Guaranty under subparagraph (a) of this Section
        9.7 may be discharged from all of its obligations and liabilities under its Subsidiary Guaranty and shall be automatically released from its obligations thereunder without the need for the execution or delivery of any other document by the holders,
        provided that (i) if such Subsidiary Guarantor is a guarantor or is otherwise liable for or in respect of any Material Credit Facility, then such Subsidiary Guarantor has been released and discharged (or
        will be released and discharged concurrently with the release of such Subsidiary Guarantor under its Subsidiary Guaranty) under such Material Credit Facility, (ii) at the time of, and after giving effect to, such release and discharge, no Default
        or Event of Default shall be existing, (iii) no amount is then due and payable under such Subsidiary Guaranty, (iv) if in connection with such Subsidiary Guarantor being released and discharged under any Material Credit Facility, any fee or other
        form of consideration is given to any holder of Indebtedness under such Material Credit Facility for such release, the holders of the Notes shall receive equivalent consideration substantially concurrently therewith and (v) each holder shall have
        received a certificate of a Responsible Officer certifying as to the matters set forth in clauses (i) through (iv).  In the event of any such release, for purposes of Section 10.6, all Indebtedness of such Subsidiary shall be deemed to have been
        incurred concurrently with such release.

       

      Section 10.        Negative
            Covenants.

       

      The Company covenants that so long as any of the Notes are outstanding:

       

      Section 10.1.       Transactions with Affiliates. 
          The Company will not, and will not permit any Subsidiary to, enter into directly or indirectly any Material transaction or Material group of related transactions (including the purchase, lease, sale or exchange of properties of any kind or the
          rendering of any service) with any Affiliate (other than the Company or another Subsidiary), except pursuant to the reasonable requirements of the Company’s or such Subsidiary’s business and upon fair and reasonable terms no less favorable to the
          Company or such Subsidiary than would be obtainable in a comparable arm’s-length transaction with a Person not an Affiliate.

       

      Section 10.2.       Merger, Consolidation, Etc. 
          The Company will not, and will not permit any Subsidiary Guarantor to, consolidate with or merge with any other Person or convey, transfer or lease all or substantially all of its assets in a single transaction or series of related transactions
          to any Person unless:

       

      

      
        - 23 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

       (a)      in the case of any such transaction involving the Company, the successor formed by such consolidation or the survivor of such merger or the Person that acquires by
        conveyance, transfer or lease all or substantially all of the assets of the Company as an entirety, as the case may be, shall be a solvent corporation or limited liability company organized and existing under the laws of the United States or any
        state thereof (including the District of Columbia), and, if the Company is not such corporation or limited liability company, (i) such corporation or limited liability company shall have executed and delivered to each holder of any Notes its
        assumption of the due and punctual performance and observance of each covenant and condition of this Agreement and the Notes and (ii) such corporation or limited liability company shall have caused to be delivered to each holder of any Notes an
        opinion of nationally recognized independent counsel, or other independent counsel reasonably satisfactory to the Required Holders, to the effect that all agreements or instruments effecting such assumption are enforceable in accordance with their
        terms and comply with the terms hereof; 

       

      (b)      in the case of any such transaction involving a Subsidiary Guarantor, the successor formed by such consolidation or the survivor of such merger or the Person that
        acquires by conveyance, transfer or lease all or substantially all of the assets of such Subsidiary Guarantor as an entirety, as the case may be, shall be (1) the Company, such Subsidiary Guarantor or another Subsidiary Guarantor; or (2) a solvent
        corporation or limited liability company (other than the Company or another Subsidiary Guarantor) that is organized and existing under the laws of the United States or any state thereof (including the District of Columbia) and, if such Subsidiary
        Guarantor is not such corporation or limited liability company, (A) such corporation or limited liability company shall have executed and delivered to each holder of Notes its assumption of the due and punctual performance and observance of each
        covenant and condition of the Subsidiary Guaranty of such Subsidiary Guarantor and (B) the Company shall have caused to be delivered to each holder of Notes an opinion of nationally recognized independent counsel, or other independent counsel
        reasonably satisfactory to the Required Holders, to the effect that all agreements or instruments effecting such assumption are enforceable in accordance with their terms and comply with the terms hereof; 

       

      (c)      each Subsidiary Guarantor under any Subsidiary Guaranty that is outstanding at the time such transaction or each transaction in such a series of transactions occurs
        reaffirms its obligations under such Subsidiary Guaranty in writing at such time pursuant to documentation that is reasonably acceptable to the Required Holders; and

       

      (d)     immediately before and immediately after giving effect to such transaction or each transaction in any such series of transactions, no Default or Event of Default shall
        have occurred and be continuing.

       

      No such conveyance, transfer or lease of substantially all of the assets of the Company or any Subsidiary Guarantor shall have the effect of releasing the Company or such Subsidiary Guarantor, as the case may be, or
        any successor corporation or limited liability company that shall theretofore have become such in the manner prescribed in this Section 10.2, from its liability under (x) this Agreement or the Notes (in the case of the Company) or (y) the
        Subsidiary Guaranty (in the case of any Subsidiary Guarantor), unless, in the case of the conveyance, transfer or lease of substantially all of the assets of a Subsidiary Guarantor, such Subsidiary Guarantor is released from its Subsidiary Guaranty
        in accordance with Section 9.7(b) in connection with or immediately following such conveyance, transfer or lease.

       

      

      
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                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      Section 10.3.       Line of Business.  The Company
          will not and will not permit any Subsidiary to engage in any business if, as a result, the general nature of the business in which the Company and its Subsidiaries, taken as a whole, would then be engaged would be substantially changed from the
          general nature of the business in which the Company and its Subsidiaries, taken as a whole, are engaged on the date of this Agreement as described in the Presentation.

        

      

      Section 10.4.       Economic Sanctions, Etc.  The
          Company will not, and will not permit any Controlled Entity to (a) become (including by virtue of being owned or controlled by a Blocked Person), own or control a Blocked Person or (b) directly or indirectly have any investment in or engage in
          any dealing or transaction (including any investment, dealing or transaction involving the proceeds of the Notes) with any Person if such investment, dealing or transaction (i) would cause any holder or any affiliate of such holder to be in
          violation of, or subject to sanctions under, any law or regulation applicable to such holder, or (ii) is prohibited by or subject to sanctions under any U.S. Economic Sanctions Laws.

       

      Section 10.5.        Liens.  (a) The Company will
          not, and will not permit any Subsidiary to, create or incur, or suffer to be incurred or to exist, any mortgage, pledge, security interest, encumbrance, lien or charge of any kind on its or their property or assets, whether now owned or hereafter
          acquired, or upon any income or profits therefrom, or transfer any property for the purpose of subjecting the same to the payment of obligations in priority to the payment of its or their general creditors, or acquire or agree to acquire any
          property or assets upon conditional sales agreements or other title retention devices, except Excepted Encumbrances; provided, however, that this requirement shall not be applicable to, nor prevent:

       

      (i)      the pledging by the Company of its assets as security for the payment of any tax, assessment or other similar charge demanded of the Company by any governmental
        authority or public body as long as the Company in good faith contests its liability to pay the same, or as security to be deposited with any governmental authority or public body for any purpose at any time required by law or governmental
        regulation as a condition to the transaction of any business or the exercise of any privilege, license or right; or 

       

      (ii)      the pledging by the Company of any assets for the purpose of securing a stay or discharge or for any other purpose in the course of any legal proceeding in which the
        Company is a party; or 

       

      (iii)     making good faith deposits in connection with tenders, contracts or leases to which the Company is a party; or 

       

      

      
        - 25 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      (iv)     the pledging by the Company or any Subsidiary of any assets for the purpose of securing Indebtedness of the Company or any Subsidiary not otherwise permitted by clauses
        (i) through (iii) or permitted as an Excepted Encumbrance, provided that Priority Debt at any one time outstanding shall not at any time exceed 10% of the Plant Account of the Company and its Subsidiaries
        (determined as of the end of the then most recently ended quarterly fiscal period), provided, further, that notwithstanding the foregoing, the Company shall not, and shall not permit any of its Subsidiaries
        to, secure pursuant to this Section 10.5(a)(iv) any Indebtedness outstanding under or pursuant to any Material Credit Facility unless and until the Notes (and any guaranty delivered in connection therewith) shall concurrently be secured equally and
        ratably with such Indebtedness pursuant to documentation reasonably acceptable to the Required Holders in substance and in form, including an intercreditor agreement and opinions of counsel to the Company and/or any such Subsidiary, as the case may
        be, from counsel that is reasonably acceptable to the Required Holders.

       

      (b)        In the event any Property or assets of the Company are subject to a lien or charge not otherwise permitted by paragraph (a) above to secure any Indebtedness of the Company (for purposes
        of this paragraph (b), the “Liened Property”), such lien or charge shall nevertheless be deemed permitted if the Company makes effective provision whereby the Notes shall (so long as any other Indebtedness
        shall be so secured) be secured (along with any other Indebtedness similarly entitled to be equally and ratably secured) by a direct lien on the Liened Property on parity to the lien or liens securing any and all such other Indebtedness; 

       

      Section 10.6.        Limitations on Indebtedness.

       

      (a)     The Company will not, and will not permit any Subsidiary to, have outstanding, or in any manner be liable in respect of, any Funded Debt or Seasonal Indebtedness, except the following:

       

                (i)            Seasonal Indebtedness of the Company and its Subsidiaries, provided that (A) such Seasonal Indebtedness has not existed for a
        period of at least 30 consecutive days in the twelve preceding months or (B) the amount of such Seasonal Indebtedness, when added to the outstanding amount of Funded Debt, does not exceed 60% of Plant Account on the books of the Company and its
        Subsidiaries at any one time outstanding; and 

       

      (ii)          Funded Debt (including the Notes) of the Company and its Subsidiaries; provided that: 

       

      (A)     such Funded Debt shall not exceed 60% of the Plant Account on the books of the Company and its Subsidiaries at any one time outstanding, and 

       

      (B)     in the case of any Funded Debt constituting Priority Debt, Priority Debt at any one time outstanding shall not exceed 10% of the Plant Account of the Company and its
        Subsidiaries (determined as of the end of the then most recently ended quarterly fiscal period).

       

      (b)    The renewal, extension or refunding of any Funded Debt issued or incurred in accordance with the limitations of Section 10.6(a)(ii) shall constitute the issuance of additional Funded Debt
        that is subject to the limitations of this Section 10.6.  Any Indebtedness paid or defeased from the proceeds of additional Funded Debt may be excluded from outstanding Indebtedness for purposes of this Section 10.6. 

       

        

      
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                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      (c)    Subject to compliance with this Section 10.6 hereof, nothing contained in this Agreement shall prohibit the Company or any Subsidiary from incurring, issuing or permitting to exist any
        Indebtedness.  

       

      Section 10.7.        Dividends, Stock Purchases. 
          The Company will not, except as hereinafter provided: 

       

      (a)    Declare or pay any dividends, either in cash or property, on any shares of its capital stock of any class (except dividends or other distributions payable solely in shares
        of capital stock of the Company, including the portion of dividends reinvested in shares of the Company’s common capital stock under the Company’s Optional Dividend Reinvestment Plan); or

       

      (b)      Directly or indirectly, purchase, redeem or retire any shares of its capital stock of any class or any warrants, rights or options to purchase or acquire any shares of
        its capital stock (other than in exchange for or out of the net proceeds to the Company from the substantially concurrent issue or sale of other shares of capital stock of the Company or warrants, rights or options to purchase or acquire any shares
        of its capital stock); or

       

      (c)       Make any other payment or distribution, either directly or indirectly, in respect of its capital stock; or

       

      (d)      Make any payment, distribution, conveyance or transfer of any property to any Subsidiary;

       

      (such declarations or payments of dividends, purchases, redemptions or retirements of capital stock and warrants, rights or options, and all such other distributions, conveyances and transfers being herein
        collectively called “Restricted Payments”), if after giving effect thereto the aggregate amount of Restricted Payments made during the period from and after December 31, 1982 to and including the date of the
        making of the Restricted Payment in question, would exceed the sum of (1) $1,500,000 plus (2) earned surplus of the Company, on a non-consolidated basis, accumulated after December 31, 1982, determined
        without any deduction on account of such Restricted Payments, provided, however, that notwithstanding the foregoing, in no event shall the Company make any distribution, conveyance or transfer to any
        Subsidiary of any property constituting the Plant Account.  

       

      The Company will not declare any dividend which constitutes a Restricted Payment payable more than 60 days after the date of declaration thereof.

       

      For the purposes of this Section 10.7 the amount of any Restricted Payment declared, paid or distributed in property of the Company shall be deemed to be the greater of the book value or fair
        market value (as determined in good faith by the Board of Directors of the Company) of such property at the time of the making of the Restricted Payment in question.

       

      

      
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                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      Section 11.        Events
            of Default.

       

      An “Event of Default” shall exist if any of the following conditions or events shall occur and be continuing:

       

      (a)   the Company defaults in the payment of any principal or Make-Whole Amount, if any, on any Note when the same becomes due and payable, whether at maturity or at a date fixed
        for prepayment or by declaration or otherwise; or

       

      (b)    the Company defaults in the payment of any interest on any Note for more than five Business Days after the same becomes due and payable; or

       

      (c)    the Company defaults in the performance of or compliance with any term contained in Section 7.1(d) or Sections 10.5, 10.6 or 10.7; or

       

      (d)   the Company or any Subsidiary Guarantor defaults in the performance of or compliance with any term contained herein (other than those referred to in Sections 11(a), (b) and
        (c)) or in any Subsidiary Guaranty and such default is not remedied within 30 days after the earlier of (i) a Responsible Officer obtaining actual knowledge of such default and (ii) the Company receiving written notice of such default from any
        holder of a Note (any such written notice to be identified as a “notice of default” and to refer specifically to this Section 11(d)); or

       

      (e)    (i) any representation or warranty made in writing by or on behalf of the Company or by any officer of the Company in this Agreement or any writing furnished in connection
        with the transactions contemplated hereby proves to have been false or incorrect in any material respect on the date as of which made, or (ii) any representation or warranty made in writing by or on behalf of any Subsidiary Guarantor or by any
        officer of such Subsidiary Guarantor in any Subsidiary Guaranty or any writing furnished in connection with such Subsidiary Guaranty proves to have been false or incorrect in any material respect on the date as of which made; or

       

      (f)     (i) the Company or any Significant Subsidiary is in default (as principal or as guarantor or other surety) in the payment of any principal of or premium or make-whole
        amount or interest on any Indebtedness that is outstanding in an aggregate principal amount of at least $5,000,000 (or its equivalent in the relevant currency of payment) beyond any period of grace provided with respect thereto, or (ii) the Company
        or any Significant Subsidiary is in default in the performance of or compliance with any term of any evidence of any Indebtedness in an aggregate outstanding principal amount of at least $5,000,000 (or its equivalent in the relevant currency of
        payment) or of any mortgage, indenture or other agreement relating thereto or any other condition exists, and as a consequence of such default or condition, such Indebtedness has become or has been declared (or one or more Persons are entitled to
        declare such Indebtedness to be) due and payable before its stated maturity or before its regularly scheduled dates of payment, or (iii) as a consequence of the occurrence or continuation of any event or condition (other than the passage of time or
        the right of the holder of Indebtedness to convert such Indebtedness into equity interests), (x) the Company or any Significant Subsidiary has become obligated to purchase or repay Indebtedness before its regular maturity or before its regularly
        scheduled dates of payment in an aggregate outstanding principal amount of at least $5,000,000 (or its equivalent in the relevant currency of payment), or (y) one or more Persons have the right to require the Company or any Significant Subsidiary
        so to purchase or repay such Indebtedness; or

       

      

      
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                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      (g)   the Company or any Significant Subsidiary (i) is generally not paying, or admits in writing its inability to pay, its debts as they become due, (ii) files, or consents by
        answer or otherwise to the filing against it of, a petition for relief or reorganization or arrangement or any other petition in bankruptcy, for liquidation or to take advantage of any bankruptcy, insolvency, reorganization, moratorium or other
        similar law of any jurisdiction, (iii) makes an assignment for the benefit of its creditors, (iv) consents to the appointment of a custodian, receiver, trustee or other officer with similar powers with respect to it or with respect to any
        substantial part of its property, (v) is adjudicated as insolvent or to be liquidated, or (vi) takes corporate action for the purpose of any of the foregoing; or

       

      (h)    a court or other Governmental Authority of competent jurisdiction enters an order appointing, without consent by the Company or any of its Significant Subsidiaries, a
        custodian, receiver, trustee or other officer with similar powers with respect to it or with respect to any substantial part of its property, or constituting an order for relief or approving a petition for relief or reorganization or any other
        petition in bankruptcy or for liquidation or to take advantage of any bankruptcy or insolvency law of any jurisdiction, or ordering the dissolution, winding-up or liquidation of the Company or any of its Significant Subsidiaries, or any such
        petition shall be filed against the Company or any of its Significant Subsidiaries and such petition shall not be dismissed within 60 days; or

       

      (i)     any event occurs with respect to the Company or any Significant Subsidiary which under the laws of any jurisdiction is analogous to any of the events described in Section
        11(g) or Section 11(h), provided that the applicable grace period, if any, which shall apply shall be the one applicable to the relevant proceeding which most closely corresponds to the proceeding described
        in Section 11(g) or Section 11(h); or

       

      (j)    one or more final judgments or orders for the payment of money aggregating in excess of $5,000,000 (or its equivalent in the relevant currency of payment), including any
        such final order enforcing a binding arbitration decision, are rendered against one or more of the Company and its Significant Subsidiaries and which judgments are not, within 60 days after entry thereof, bonded, discharged or stayed pending
        appeal, or are not discharged within 60 days after the expiration of such stay; or

       

      

      
        - 29 -

        
          

        
          	
                  The York Water Company

                	
                  Note Purchase Agreement

                

        

      

      (k)    if (i) any Plan shall fail to satisfy the minimum funding standards of ERISA or the Code for any plan year or part thereof or a waiver of such standards or extension of
        any amortization period is sought or granted under section 412 of the Code, (ii) a notice of intent to terminate any Plan shall have been or is reasonably expected to be filed with the PBGC or the PBGC shall have instituted proceedings under ERISA
        section 4042 to terminate or appoint a trustee to administer any Plan or the PBGC shall have notified the Company or any ERISA Affiliate that a Plan may become a subject of any such proceedings, (iii) there is any “amount of unfunded benefit
        liabilities” (within the meaning of section 4001(a)(18) of ERISA) under one or more Plans, determined in accordance with Title IV of ERISA, (iv) the aggregate present value of accrued benefit liabilities under all funded Non-U.S. Plans exceeds the
        aggregate current value of the assets of such Non-U.S. Plans allocable to such liabilities, (v) the Company or any ERISA Affiliate shall have incurred or is reasonably expected to incur any liability pursuant to Title I or IV of ERISA or the
        penalty or excise tax provisions of the Code relating to employee benefit plans, (vi) the Company or any ERISA Affiliate withdraws from any Multiemployer Plan, (vii) the Company or any Subsidiary establishes or amends any employee welfare benefit
        plan that provides post-employment welfare benefits in a manner that would increase the liability of the Company or any Subsidiary thereunder, (viii) the Company or any Subsidiary fails to administer or maintain a Non-U.S. Plan in compliance with
        the requirements of any and all applicable laws, statutes, rules, regulations or court orders or any Non-U.S. Plan is involuntarily terminated or wound up, or (ix) the Company or any Subsidiary becomes subject to the imposition of a financial
        penalty (which for this purpose shall mean any tax, penalty or other liability, whether by way of indemnity or otherwise) with respect to one or more Non-U.S. Plans; and any such event or events described in clauses (i) through (ix) above, either
        individually or together with any other such event or events, would reasonably be expected to have a Material Adverse Effect.  As used in this Section 11(k), the terms “employee benefit plan” and “employee welfare benefit plan” shall have the respective meanings assigned to such terms in section 3 of ERISA; or

       

      (l)     any Subsidiary Guaranty shall cease to be in full force and effect, any such Subsidiary Guarantor or any Person acting on behalf of any such Subsidiary Guarantor shall
        contest in any manner the validity, binding nature or enforceability of any Subsidiary Guaranty, or the obligations of any Subsidiary Guarantor under any Subsidiary Guaranty are not or cease to be legal, valid, binding and enforceable in accordance
        with the terms of such Subsidiary Guaranty.

       

      Section 12.        Remedies on Default, Etc.

       

      Section 12.1.        Acceleration.  (a) If an Event
          of Default with respect to the Company described in Section 11(g), (h) or (i) (other than an Event of Default described in clause (i) of Section 11(g) or described in clause (vi) of Section 11(g) by virtue of the fact that such clause encompasses
          clause (i) of Section 11(g)) has occurred, all the Notes then outstanding shall automatically become immediately due and payable.

       

      (b)     If any other Event of Default has occurred and is continuing, the Required Holders may at any time at its or their option, by notice or notices to the Company, declare all
        the Notes then outstanding to be immediately due and payable.

       

      (c)     If any Event of Default described in Section 11(a) or (b) has occurred and is continuing, any holder or holders of Notes at the time outstanding affected by such Event of
        Default may at any time, at its or their option, by notice or notices to the Company, declare all the Notes held by it or them to be immediately due and payable.

       

      

      
        
          
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                      The York Water Company

                    	
                      Note Purchase Agreement

                    

            

          

          Upon any Notes becoming due and payable under this Section 12.1, whether automatically or by declaration, such Notes will forthwith mature and the entire unpaid principal amount of such Notes,
            plus (x) all accrued and unpaid interest thereon (including interest accrued thereon at the Default Rate) and (y) the Make-Whole Amount determined in respect of such principal amount, shall all be immediately due and payable, in each and every
            case without presentment, demand, protest or further notice, all of which are hereby waived.  The Company acknowledges, and the parties hereto agree, that each holder of a Note has the right to maintain its investment in the Notes free from
            repayment by the Company (except as herein specifically provided for) and that the provision for payment of a Make-Whole Amount by the Company in the event that the Notes are prepaid or are accelerated as a result of an Event of Default, is
            intended to provide compensation for the deprivation of such right under such circumstances.

           

          Section 12.2.        Other Remedies.  If any
              Default or Event of Default has occurred and is continuing, and irrespective of whether any Notes have become or have been declared immediately due and payable under Section 12.1, the holder of any Note at the time outstanding may proceed to
              protect and enforce the rights of such holder by an action at law, suit in equity or other appropriate proceeding, whether for the specific performance of any agreement contained herein or in any Note or Subsidiary Guaranty, or for an
              injunction against a violation of any of the terms hereof or thereof, or in aid of the exercise of any power granted hereby or thereby or by law or otherwise.

           

          Section 12.3.       Rescission.  At any time
              after any Notes have been declared due and payable pursuant to Section 12.1(b) or (c), the Required Holders, by written notice to the Company, may rescind and annul any such declaration and its consequences if (a) the Company has paid all
              overdue interest on the Notes, all principal of and Make-Whole Amount, if any, on any Notes that are due and payable and are unpaid other than by reason of such declaration, and all interest on such overdue principal and Make-Whole Amount, if
              any, and (to the extent permitted by applicable law) any overdue interest in respect of the Notes, at the Default Rate, (b) neither the Company nor any other Person shall have paid any amounts which have become due solely by reason of such
              declaration, (c) all Events of Default and Defaults, other than non-payment of amounts that have become due solely by reason of such declaration, have been cured or have been waived pursuant to Section 17, and (d) no judgment or decree has
              been entered for the payment of any monies due pursuant hereto or to the Notes.  No rescission and annulment under this Section 12.3 will extend to or affect any subsequent Event of Default or Default or impair any right consequent thereon.

           

          Section 12.4.       No Waivers or Election of
                Remedies, Expenses, Etc.  No course of dealing and no delay on the part of any holder of any Note in exercising any right, power or remedy shall operate as a waiver thereof or otherwise prejudice such holder’s rights, powers or
              remedies.  No right, power or remedy conferred by this Agreement, any Subsidiary Guaranty or any Note upon any holder thereof shall be exclusive of any other right, power or remedy referred to herein or therein or now or hereafter available
              at law, in equity, by statute or otherwise.  Without limiting the obligations of the Company under Section 15, the Company will pay to the holder of each Note on demand such further amount as shall be sufficient to cover all costs and
              expenses of such holder incurred in any enforcement or collection under this Section 12, including reasonable attorneys’ fees, expenses and disbursements.

          

          

          
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                      The York Water Company

                    	
                      Note Purchase Agreement

                    

            

          

          Section 13.        Registration;

                Exchange; Substitution of Notes.

           

          Section 13.1.       Registration of Notes.  The
              Company shall keep at its principal executive office a register for the registration and registration of transfers of Notes.  The name and address of each holder of one or more Notes, each transfer thereof and the name and address of each
              transferee of one or more Notes shall be registered in such register.  If any holder of one or more Notes is a nominee, then (a) the name and address of the beneficial owner of such Note or Notes shall also be registered in such register as
              an owner and holder thereof and (b) at any such beneficial owner’s option, either such beneficial owner or its nominee may execute any amendment, waiver or consent pursuant to this Agreement.  Prior to due presentment for registration of
              transfer, the Person in whose name any Note shall be registered shall be deemed and treated as the owner and holder thereof for all purposes hereof, and the Company shall not be affected by any notice or knowledge to the contrary.  The
              Company shall give to any holder of a Note that is an Institutional Investor promptly upon request therefor, a complete and correct copy of the names and addresses of all registered holders of Notes.

           

          Section 13.2.       Transfer and Exchange of Notes. 

              Upon surrender of any Note to the Company at the address and to the attention of the designated officer (all as specified in Section 18(iii)), for registration of transfer or exchange (and in the case of a surrender for registration of
              transfer accompanied by a written instrument of transfer duly executed by the registered holder of such Note or such holder’s attorney duly authorized in writing and accompanied by the relevant name, address and other information for notices
              of each transferee of such Note or part thereof), within 10 Business Days thereafter, the Company shall execute and deliver, at the Company’s expense (except as provided below), one or more new Notes (as requested by the holder thereof) in
              exchange therefor, in an aggregate principal amount equal to the unpaid principal amount of the surrendered Note.  Each such new Note shall be payable to such Person as such holder may request and shall be substantially in the form of
              Schedule 1.  Each such new Note shall be dated and bear interest from the date to which interest shall have been paid on the surrendered Note or dated the date of the surrendered Note if no interest shall have been paid thereon.  The Company
              may require payment of a sum sufficient to cover any stamp tax or governmental charge imposed in respect of any such transfer of Notes.  Notes shall not be transferred in denominations of less than $100,000, provided that if necessary to
              enable the registration of transfer by a holder of its entire holding of Notes, one Note may be in a denomination of less than $100,000.  Any transferee, by its acceptance of a Note registered in its name (or the name of its nominee), shall
              be deemed to have made the representation set forth in Section 6.2.

           

          Section 13.3.       Replacement of Notes.  Upon
              receipt by the Company at the address and to the attention of the designated officer (all as specified in Section 18(iii)) of evidence reasonably satisfactory to it of the ownership of and the loss, theft, destruction or mutilation of any
              Note (which evidence shall be, in the case of an Institutional Investor, notice from such Institutional Investor of such ownership and such loss, theft, destruction or mutilation), and

          

          

          
            - 32 -

            
              

            
              	
                      The York Water Company

                    	
                      Note Purchase Agreement

                    

            

          

           (a)    in the case of loss, theft or destruction, of indemnity reasonably satisfactory to it (provided that if the holder of such Note is, or is a nominee for, an original
            Purchaser or another holder of a Note with a minimum net worth of at least $50,000,000 or a Qualified Institutional Buyer, such Person’s own unsecured agreement of indemnity shall be deemed to be satisfactory), or

           

           (b)      in the case of mutilation, upon surrender and cancellation thereof,

           

          within 10 Business Days thereafter, the Company at its own expense shall execute and deliver, in lieu thereof, a new Note, dated and bearing interest from the date to which interest shall have been paid on such
            lost, stolen, destroyed or mutilated Note or dated the date of such lost, stolen, destroyed or mutilated Note if no interest shall have been paid thereon.

           

          Section 14.        Payments

                on Notes.

           

          Section 14.1.        Place of Payment.  Subject
              to Section 14.2, payments of principal, Make-Whole Amount, if any, and interest becoming due and payable on the Notes shall be made in New York, New York at the principal office of PNC Bank in such jurisdiction.  The Company may at any time,
              by notice to each holder of a Note, change the place of payment of the Notes so long as such place of payment shall be either the principal office of the Company in such jurisdiction or the principal office of a bank or trust company in such
              jurisdiction.

           

          
            Section 14.2.      Payment by Wire Transfer. 
                So long as any Purchaser or its nominee shall be the holder of any Note, and notwithstanding anything contained in Section 14.1 or in such Note to the contrary, the Company will pay all sums becoming due on such Note for principal,
                Make-Whole Amount, if any, interest and all other amounts becoming due hereunder by the method and at the address specified for such purpose below such Purchaser’s name in the Purchaser Schedule, or by such other method or at such other
                address as such Purchaser shall have from time to time specified to the Company in writing for such purpose, without the presentation or surrender of such Note or the making of any notation thereon, except that upon written request of the
                Company made concurrently with or reasonably promptly after payment or prepayment in full of any Note, such Purchaser shall surrender such Note for cancellation, reasonably promptly after any such request, to the Company at its principal
                executive office or at the place of payment most recently designated by the Company pursuant to Section 14.1.  Prior to any sale or other disposition of any Note held by a Purchaser or its nominee, such Purchaser will, at its election,
                either endorse thereon the amount of principal paid thereon and the last date to which interest has been paid thereon or surrender such Note to the Company in exchange for a new Note or Notes pursuant to Section 13.2.  The Company will
                afford the benefits of this Section 14.2 to any Institutional Investor that is the direct or indirect transferee of any Note purchased by a Purchaser under this Agreement and that has made the same agreement relating to such Note as the
                Purchasers have made in this Section 14.2.

          

           

          

          
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                      The York Water Company

                    	
                      Note Purchase Agreement

                    

            

          

          Section 14.3.        FATCA Information.  By acceptance of any Note, the holder of such Note agrees that such holder will with reasonable promptness duly complete and deliver to the Company, or to such other Person as may be reasonably
              requested by the Company, from time to time (a) in the case of any such holder that is a United States Person, such holder’s United States tax identification number or other Forms reasonably requested by the Company necessary to establish
              such holder’s status as a United States Person under FATCA and as may otherwise be necessary for the Company to comply with its obligations under FATCA and (b) in the case of any such holder that is not a United States Person, such
              documentation prescribed by applicable law (including as prescribed by section 1471(b)(3)(C)(i) of the Code) and such additional documentation as may be necessary for the Company to comply with its obligations under FATCA and to determine
              that such holder has complied with such holder’s obligations under FATCA or to determine the amount (if any) to deduct and withhold from any such payment made to such holder.  Nothing in this Section 14.3 shall require any holder to provide
              information that is confidential or proprietary to such holder unless the Company is required to obtain such information under FATCA and, in such event, the Company shall treat any such information it receives as confidential.

           

          Section 15.        Expenses,

                Etc.

           

          Section 15.1.        Transaction Expenses.  Whether or not the transactions contemplated hereby are consummated, the Company will pay all costs and expenses (including reasonable attorneys’ fees of a special counsel and, if reasonably required by
              the Required Holders, local or other counsel) incurred by the Purchasers and each other holder of a Note in connection with such transactions and in connection with any amendments, waivers or consents under or in respect of this Agreement,
              any Subsidiary Guaranty or the Notes (whether or not such amendment, waiver or consent becomes effective), including: (a) the costs and expenses incurred in enforcing or defending (or determining whether or how to enforce or defend) any
              rights under this Agreement, any Subsidiary Guaranty or the Notes or in responding to any subpoena or other legal process or informal investigative demand issued in connection with this Agreement, any Subsidiary Guaranty or the Notes, or by
              reason of being a holder of any Note, (b) the costs and expenses, including financial advisors’ fees, incurred in connection with the insolvency or bankruptcy of the Company or any Subsidiary or in connection with any work-out or
              restructuring of the transactions contemplated hereby and by the Notes and any Subsidiary Guaranty and (c) the costs and expenses incurred in connection with the initial filing of this Agreement and all related documents and financial
              information with the SVO provided, that such costs and expenses under this clause (c) shall not exceed $3,500.  If required by the NAIC, the Company shall obtain and maintain at its own cost and
              expense a Legal Entity Identifier (LEI).

           

          The Company will pay, and will save each Purchaser and each other holder of a Note harmless from, (i) all claims in respect of any fees, costs or expenses, if any, of brokers and finders (other
            than those, if any, retained by a Purchaser or other holder in connection with its purchase of the Notes), (ii) any and all wire transfer fees that any bank or other financial institution deducts from any payment under such Note to such holder
            or otherwise charges to a holder of a Note with respect to a payment under such Note and (iii) any judgment, liability, claim, order, decree, fine, penalty, cost, fee, expense (including reasonable attorneys’ fees and expenses) or obligation
            resulting from the consummation of the transactions contemplated hereby, including the use of the proceeds of the Notes by the Company.

          

          

          
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                      The York Water Company

                    	
                      Note Purchase Agreement

                    

            

          

          Section 15.2.       Certain Taxes.  The Company agrees to pay all stamp, documentary or similar taxes or fees which may be payable in respect of the execution and delivery or the enforcement of this Agreement or any Subsidiary Guaranty or
              the execution and delivery (but not the transfer) or the enforcement of any of the Notes in the United States or any other jurisdiction where the Company or any Subsidiary Guarantor has assets or of any amendment of, or waiver or consent
              under or with respect to, this Agreement or any Subsidiary Guaranty or of any of the Notes, and to pay any value added tax due and payable in respect of reimbursement of costs and expenses by the Company pursuant to this Section 15, and will
              save each holder of a Note to the extent permitted by applicable law harmless against any loss or liability resulting from nonpayment or delay in payment of any such tax or fee required to be paid by the Company hereunder.

           

          Section 15.3.       Survival.  The obligations of the Company under this Section 15 will survive the payment or transfer of any Note, the enforcement, amendment or waiver of any provision of this Agreement, any Subsidiary Guaranty or
              the Notes, and the termination of this Agreement.

           

          Section 16.        Survival

                of Representations and Warranties; Entire Agreement.

           

          All representations and warranties contained herein shall survive the execution and delivery of this Agreement and the Notes, the purchase or transfer by any Purchaser of any Note or portion
            thereof or interest therein and the payment of any Note, and may be relied upon by any subsequent holder of a Note, regardless of any investigation made at any time by or on behalf of such Purchaser or any other holder of a Note.  All
            statements contained in any certificate or other instrument delivered by or on behalf of the Company pursuant to this Agreement shall be deemed representations and warranties of the Company under this Agreement.  Subject to the preceding
            sentence, this Agreement, the Notes and any Subsidiary Guaranties embody the entire agreement and understanding between each Purchaser and the Company and supersede all prior agreements and understandings relating to the subject matter hereof.

           

          Section 17.        Amendment

                and Waiver.  

           

          Section 17.1.        Requirements.  This Agreement and the Notes may be amended, and the observance of any term hereof or of the Notes may be waived (either retroactively or prospectively), only with the written consent of the Company and
              the Required Holders, except that:

           

          (a)    no amendment or waiver of any of Sections 1, 2, 3, 4, 5, 6 or 21 hereof, or any defined term (as it is used therein), will be effective as to any Purchaser unless
            consented to by such Purchaser in writing; and

           

          

          
            (b)    no amendment or waiver may, without the written consent of each Purchaser and the holder of each Note at the time outstanding, (i) subject to Section 12 relating to acceleration or
              rescission, change the amount or time of any prepayment or payment of principal of, or reduce the rate or change the time of payment or method of computation of (x) interest on the Notes or (y) the Make-Whole Amount, (ii) change the
              percentage of the principal amount of the Notes the holders of which are required to consent to any amendment or waiver, or (iii) amend any of Sections 8 (except as set forth in the second sentence of
              Section 8.2), 11(a), 11(b), 12, 17 or 20.

          

          
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                      The York Water Company

                    	
                      Note Purchase Agreement

                    

            

          

          Section 17.2.        Solicitation of Holders of Notes.

           

          (a)         Solicitation.  The Company will provide each holder of a Note with sufficient information, sufficiently far in advance of the date a
            decision is required, to enable such holder to make an informed and considered decision with respect to any proposed amendment, waiver or consent in respect of any of the provisions hereof or of the Notes or any Subsidiary Guaranty.  The
            Company will deliver executed or true and correct copies of each amendment, waiver or consent effected pursuant to this Section 17 or any Subsidiary Guaranty to each holder of a Note promptly following the date on which it is executed and
            delivered by, or receives the consent or approval of, the requisite holders of Notes.

           

          (b)           Payment.  The Company will not directly or indirectly pay or cause to be paid any remuneration, whether by way of supplemental or
            additional interest, fee or otherwise, or grant any security or provide other credit support, to any holder of a Note as consideration for or as an inducement to the entering into by such holder of any waiver or amendment of any of the terms
            and provisions hereof or of any Subsidiary Guaranty or any Note unless such remuneration is concurrently paid, or security is concurrently granted or other credit support concurrently provided, on the same terms, ratably to each holder of a
            Note even if such holder did not consent to such waiver or amendment.

           

          (c)        Consent in Contemplation of Transfer.  Any consent given pursuant to this Section 17 or any Subsidiary Guaranty by a holder of a Note that
            has transferred or has agreed to transfer its Note to (i) the Company, (ii) any Subsidiary or any other Affiliate or (iii) any other Person in connection with, or in anticipation of, such other Person
              acquiring, making a tender offer for or merging with the Company and/or any of its Affiliates, in each case in connection with such consent, shall be void and of no force or effect except solely as to such holder, and any amendments
            effected or waivers granted or to be effected or granted that would not have been or would not be so effected or granted but for such consent (and the consents of all other holders of Notes that were acquired under the same or similar
            conditions) shall be void and of no force or effect except solely as to such holder.

           

          Section 17.3.       Binding Effect, Etc.  Any amendment or waiver consented to as provided in this Section 17 or any Subsidiary Guaranty applies equally to all holders of Notes and is binding upon them and upon each future holder of any Note
              and upon the Company without regard to whether such Note has been marked to indicate such amendment or waiver.  No such amendment or waiver will extend to or affect any obligation, covenant, agreement, Default or Event of Default not
              expressly amended or waived or impair any right consequent thereon.  No course of dealing between the Company and any holder of a Note and no delay in exercising any rights hereunder or under any Note or Subsidiary Guaranty shall operate as a
              waiver of any rights of any holder of such Note.

          

          

          
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                      The York Water Company

                    	
                      Note Purchase Agreement

                    

            

          

          Section 17.4.        Notes Held by Company, Etc.  Solely for the purpose of determining whether the holders of the requisite percentage of the aggregate principal amount of Notes then outstanding approved or consented to any amendment, waiver or
              consent to be given under this Agreement, any Subsidiary Guaranty or the Notes, or have directed the taking of any action provided herein or in any Subsidiary Guaranty or the Notes to be taken upon the direction of the holders of a specified
              percentage of the aggregate principal amount of Notes then outstanding, Notes directly or indirectly owned by the Company or any of its Affiliates shall be deemed not to be outstanding.

           

          Section 18.        Notices.

           

           Except to the extent otherwise provided in Section 7.4, all notices and communications provided for hereunder shall be in writing and sent (a) by telecopy if the sender on the same day sends a
            confirming copy of such notice by an internationally recognized overnight delivery service (charges prepaid), or (b) by registered or certified mail with return receipt requested (postage prepaid), or (c) by an internationally recognized
            overnight delivery service (charges prepaid).  Any such notice must be sent:

           

          (i)    if to any Purchaser or its nominee, to such Purchaser or nominee at the address specified for such communications in the Purchaser Schedule, or at such other address
            as such Purchaser or nominee shall have specified to the Company in writing,

           

          (ii)    if to any other holder of any Note, to such holder at such address as such other holder shall have specified to the Company in writing, or

           

          (iii)   if to the Company, to the Company at its address set forth at the beginning hereof to the attention of Chief Financial Officer, or at such other address as the
            Company shall have specified to the holder of each Note in writing.

           

          Notices under this Section 18 will be deemed given only when actually received.

           

          Section 19.        Reproduction

                of Documents.

           

          This Agreement and all documents relating thereto, including (a) consents, waivers and modifications that may hereafter be executed, (b) documents received by any Purchaser at the Closing
            (except the Notes themselves), and (c) financial statements, certificates and other information previously or hereafter furnished to any Purchaser, may be reproduced by such Purchaser by any photographic, photostatic, electronic, digital, or
            other similar process and such Purchaser may destroy any original document so reproduced.  The Company agrees and stipulates that, to the extent permitted by applicable law, any such reproduction shall be admissible in evidence as the original
            itself in any judicial or administrative proceeding (whether or not the original is in existence and whether or not such reproduction was made by such Purchaser in the regular course of business) and any enlargement, facsimile or further
            reproduction of such reproduction shall likewise be admissible in evidence.  This Section 19 shall not prohibit the Company or any other holder of Notes from contesting any such reproduction to the same extent that it could contest the
            original, or from introducing evidence to demonstrate the inaccuracy of any such reproduction.

          

          

          
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                      The York Water Company

                    	
                      Note Purchase Agreement

                    

            

          

          Section 20.        Confidential

                Information.

           

          For the purposes of this Section 20, “Confidential Information” means information delivered to any Purchaser by or on behalf of the Company or any
            Subsidiary in connection with the transactions contemplated by or otherwise pursuant to this Agreement that is proprietary in nature and that was clearly marked or labeled or otherwise adequately identified when received by such Purchaser as
            being confidential information of the Company or such Subsidiary, provided that such term does not include information that (a) was publicly known or otherwise known to such Purchaser prior to the time
            of such disclosure, (b) subsequently becomes publicly known through no act or omission by such Purchaser or any Person acting on such Purchaser’s behalf, (c) otherwise becomes known to such Purchaser other than through disclosure by the Company
            or any Subsidiary or (d) constitutes financial statements delivered to such Purchaser under Section 7.1 that are otherwise publicly available.  Each Purchaser will maintain the confidentiality of such Confidential Information in accordance with
            procedures adopted by such Purchaser in good faith to protect confidential information of third parties delivered to such Purchaser, provided that such Purchaser may deliver or disclose Confidential
            Information to (i) its directors, officers, employees, agents, attorneys, trustees and affiliates (to the extent such disclosure reasonably relates to the administration of the investment represented by its Notes), (ii) its auditors, financial
            advisors and other professional advisors who agree to hold confidential the Confidential Information substantially in accordance with this Section 20, (iii) any other holder of any Note, (iv) any Institutional Investor to which it sells or
            offers to sell such Note or any part thereof or any participation therein (if such Person has agreed in writing prior to its receipt of such Confidential Information to be bound by this Section 20), (v) any Person from which it offers to
            purchase any Security of the Company (if such Person has agreed in writing prior to its receipt of such Confidential Information to be bound by this Section 20), (vi) any federal or state regulatory authority having jurisdiction over such
            Purchaser, (vii) the NAIC or the SVO or, in each case, any similar organization, or any nationally recognized rating agency that requires access to information about such Purchaser’s investment portfolio, or (viii) any other Person to which
            such delivery or disclosure may be necessary or appropriate (w) to effect compliance with any law, rule, regulation or order applicable to such Purchaser, (x) in response to any subpoena or other legal process, (y) in connection with any
            litigation to which such Purchaser is a party or (z) if an Event of Default has occurred and is continuing, to the extent such Purchaser may reasonably determine such delivery and disclosure to be necessary or appropriate in the enforcement or
            for the protection of the rights and remedies under such Purchaser’s Notes, this Agreement or any Subsidiary Guaranty.  Each holder of a Note, by its acceptance of a Note, will be deemed to have agreed to be bound by and to be entitled to the
            benefits of this Section 20 as though it were a party to this Agreement.  On reasonable request by the Company in connection with the delivery to any holder of a Note of information required to be delivered to such holder under this Agreement
            or requested by such holder (other than a holder that is a party to this Agreement or its nominee), such holder will enter into an agreement with the Company embodying this Section 20.

          

          

          
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                      The York Water Company

                    	
                      Note Purchase Agreement

                    

            

          

          In the event that as a condition to receiving access to information relating to the Company or its Subsidiaries in connection with the transactions contemplated by or otherwise pursuant to this
            Agreement, any Purchaser or holder of a Note is required to agree to a confidentiality undertaking (whether through IntraLinks, another secure website, a secure virtual workspace or otherwise) which is different from this Section 20, this
            Section 20 shall not be amended thereby and, as between such Purchaser or such holder and the Company, this Section 20 shall supersede any such other confidentiality undertaking.

           

          Section 21.        Substitution

                of Purchaser.

           

          Each Purchaser shall have the right to substitute any one of its Affiliates or another Purchaser or any one of such other Purchaser’s Affiliates (a “Substitute
              Purchaser”) as the purchaser of the Notes that it has agreed to purchase hereunder, by written notice to the Company, which notice shall be signed by both such Purchaser and such Substitute Purchaser, shall contain such Substitute
            Purchaser’s agreement to be bound by this Agreement and shall contain a confirmation by such Substitute Purchaser of the accuracy with respect to it of the representations set forth in Section 6.  Upon receipt of such notice, any reference to
            such Purchaser in this Agreement (other than in this Section 21), shall be deemed to refer to such Substitute Purchaser in lieu of such original Purchaser.  In the event that such Substitute Purchaser is so substituted as a Purchaser hereunder
            and such Substitute Purchaser thereafter transfers to such original Purchaser all of the Notes then held by such Substitute Purchaser, upon receipt by the Company of notice of such transfer, any reference to such Substitute Purchaser as a
            “Purchaser” in this Agreement (other than in this Section 21), shall no longer be deemed to refer to such Substitute Purchaser, but shall refer to such original Purchaser, and such original Purchaser shall again have all the rights of an
            original holder of the Notes under this Agreement.

           

          Section 22.        Miscellaneous.

           

          Section 22.1.        Successors and Assigns.  All covenants and other agreements contained in this Agreement by or on behalf of any of the parties hereto bind and inure to the benefit of their respective successors and assigns (including any
              subsequent holder of a Note) whether so expressed or not, except that, subject to Section 10.2, the Company may not assign or otherwise transfer any of its rights or obligations hereunder or under the Notes without the prior written consent
              of each holder.  Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto and their respective successors and assigns permitted hereby) any legal or equitable right, remedy
              or claim under or by reason of this Agreement.  

          

          

          
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                      The York Water Company

                    	
                      Note Purchase Agreement

                    

            

          

          Section 22.2.       Accounting Terms.  All accounting terms used herein which are not expressly defined in this Agreement have the meanings respectively given to them in accordance with GAAP.  Except as otherwise specifically provided
              herein, (i) all computations made pursuant to this Agreement shall be made in accordance with GAAP, and (ii) all financial statements shall be prepared in accordance with GAAP.  For purposes of determining compliance with this Agreement
              (including Section 9, Section 10 and the definition of “Indebtedness”), any election by the Company to measure any financial liability using fair value (as permitted by Financial Accounting Standards Board Accounting Standards Codification
              Topic No. 825-10-25 – Fair Value Option, International Accounting Standard 39 – Financial Instruments: Recognition and Measurement or any similar accounting
              standard) shall be disregarded and such determination shall be made as if such election had not been made.

           

          Section 22.3.       Severability.  Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without
              invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall (to the full extent permitted by law) not invalidate or render unenforceable such provision in any other jurisdiction.

           

          Section 22.4.        Construction, Etc.  Each covenant contained herein shall be construed (absent express provision to the contrary) as being independent of each other covenant contained herein, so that compliance with any one covenant shall
              not (absent such an express contrary provision) be deemed to excuse compliance with any other covenant.  Where any provision herein refers to action to be taken by any Person, or which such Person is prohibited from taking, such provision
              shall be applicable whether such action is taken directly or indirectly by such Person.

           

          Defined terms herein shall apply equally to the singular and plural forms of the terms defined.  Whenever the context may require, any pronoun shall include the corresponding masculine,
            feminine and neuter forms.  The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.”  The word “will” shall be construed to have the same meaning and effect as the word “shall.”  Unless
            the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented
            or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein) and, for purposes of the Notes, shall also include any such notes issued in substitution therefor pursuant to Section 13,
            (b) subject to Section 22.1, any reference herein to any Person shall be construed to include such Person’s successors and assigns, (c) the words “herein,” “hereof” and “hereunder,” and words of similar import, shall be construed to refer to
            this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Sections and Schedules shall be construed to refer to Sections of, and Schedules to, this Agreement, and (e) any reference to any law or
            regulation herein shall, unless otherwise specified, refer to such law or regulation as amended, modified or supplemented from time to time.

          

          

          
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                      The York Water Company

                    	
                      Note Purchase Agreement

                    

            

          

          Section 22.5.       Counterparts; Electronic
                Contracting.  This Agreement may be executed in any number of counterparts, each of which shall be an original but all of which together shall constitute one instrument.  Each counterpart may
              consist of a number of copies hereof, each signed by less than all, but together signed by all, of the parties hereto.  The parties agree to electronic contracting and signatures with respect to this Agreement and the other documents (other
              than the Notes).  Delivery of an electronic signature to, or a signed copy of, this Agreement and such other documents (other than the Notes) by facsimile, email or other electronic transmission shall be fully binding on the parties to the
              same extent as the delivery of the signed originals and shall be admissible into evidence for all purposes.  The words “execution,” “execute”, “signed,” “signature,” and words of like import in or related to any document to be signed in
              connection with this Agreement and the other documents (other than the Notes) shall be deemed to include electronic signatures, the electronic matching of assignment terms and contract formations on electronic platforms approved by the
              Company, or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the
              extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform
              Electronic Transactions Act.  Notwithstanding the foregoing, if any Purchaser shall request manually signed counterpart signatures to any document, the Company hereby agrees to use its reasonable endeavors to provide such manually signed
              signature pages as soon as reasonably practicable (but in any event within 30 days of such request or such longer period as the requesting Purchaser and the Company may mutually agree).

           

          Section 22.6.      Governing Law.  This Agreement shall be construed and enforced in accordance with, and the rights of the parties shall be governed by, the law of the State of New York excluding choice‐of‐law principles of the law of
              such State that would permit the application of the laws of a jurisdiction other than such State.

           

          Section 22.7.       Jurisdiction and Process; Waiver
                of Jury Trial.  (a) The Company irrevocably submits to the non-exclusive jurisdiction of any New York State or federal court sitting in the Borough of Manhattan, The City of New York, over
              any suit, action or proceeding arising out of or relating to this Agreement or the Notes.  To the fullest extent permitted by applicable law, the Company irrevocably waives and agrees not to assert, by way of motion, as a defense or
              otherwise, any claim that it is not subject to the jurisdiction of any such court, any objection that it may now or hereafter have to the laying of the venue of any such suit, action or proceeding brought in any such court and any claim that
              any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum.

           

          (b)        The Company agrees, to the fullest extent permitted by applicable law, that a final judgment in any suit, action or proceeding of the nature referred to in Section 22.7(a) brought in
            any such court shall be conclusive and binding upon it subject to rights of appeal, as the case may be, and may be enforced in the courts of the United States of America or the State of New York (or any other courts to the jurisdiction of which
            it or any of its assets is or may be subject) by a suit upon such judgment. 

          

          

          
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                      The York Water Company

                    	
                      Note Purchase Agreement

                    

            

          

          (c)         The Company consents to process being served by or on behalf of any holder of Notes in any suit, action or proceeding of the nature referred to in Section 22.7(a) by mailing a copy
            thereof by registered, certified priority or express mail (or any substantially similar form of mail), postage prepaid, return receipt or delivery confirmation requested, to it at its address specified in Section 18 or at such other address of
            which such holder shall then have been notified pursuant to said Section.  The Company agrees that such service upon receipt (i) shall be deemed in every respect effective service of process upon it in any such suit, action or proceeding and
            (ii) shall, to the fullest extent permitted by applicable law, be taken and held to be valid personal service upon and personal delivery to it.  Notices hereunder shall be conclusively presumed received as evidenced by a delivery receipt
            furnished by the United States Postal Service or any reputable commercial delivery service.

           

          (d)        Nothing in this Section 22.7 shall affect the right of any holder of a Note to serve process in any manner permitted by law, or limit any right that the holders of any of the Notes
            may have to bring proceedings against the Company in the courts of any appropriate jurisdiction or to enforce in any lawful manner a judgment obtained in one jurisdiction in any other jurisdiction.

           

          (e)         The parties hereto hereby waive trial by jury in any action brought on or with respect to this Agreement, the Notes or any other document
              executed in connection herewith or therewith.

          

          

          
            - 42 -

            
              

          

          If you are in agreement with the foregoing, please sign the form of agreement on a counterpart of this Agreement and return it to the Company, whereupon this Agreement shall become a binding
            agreement between you and the Company.

          

          

          	 	
                  Very truly yours,

                
	 	 
	 	
                  The York Water Company

                
	 	 
	 	
                  By

                	
                  /s/ Joseph T. Hand

                
	 	 	
                  Its President and CEO

                

          

          

          
            
              

          

          	
                  This Agreement is hereby

                	 	 
	
                  accepted and agreed to as 

                	 	 
	
                  of the date hereof.

                	 	 
	 	 	 
	 	
                  THE LINCOLN NATIONAL LIFE INSURANCE COMPANY

                
	 	 	 
	 	By:	
                  Macquarie Investment Management Advisers, a series of Macquarie Investment Management Business Trust, Attorney in Fact

                
	 	 	 
	 	By:	
                  /s/ Karl Spaeth

                
	 	 	
                  Name: Karl Spaeth

                
	 	 	
                  Title: Senior Vice President

                
	 	 	 
	 	
                  LINCOLN LIFE & ANNUITY COMPANY OF NEW YORK

                
	 	

                	 
	 	By:	
                  Macquarie Investment Management

                
	 	 	
                  Advisers, a series of Macquarie Investment

                
	 	 	
                  Management Business Trust, Attorney in

                
	 	 	
                  Fact

                
	 	 	 
	 	By:	
                  /s/ Karl Spaeth

                
	 	 	
                  Name: Karl Spaeth

                
	 	 	
                  Title: Senior Vice President

                

          

          

          
            
              

          

          	
                  This Agreement is hereby

                	 
	
                  accepted and agreed to as 

                	 
	
                  of the date hereof.

                	 
	 	 
	 	
                  UNITED OF OMAHA LIFE INSURANCE COMPANY

                
	 	 
	 	
                  By:

                	
                  /s/ Justin P. Kavan

                
	 	 	
                  Name: Justin P. Kavan

                
	 	 	
                  Title: Senior Vice President

                

           

          
            
              

          

          Defined Terms

           

          As used herein, the following terms have the respective meanings set forth below or set forth in the Section hereof following such term:

           

          “Affiliate” means, at any
              time, and with respect to any Person, any other Person that at such time directly or indirectly through one or more intermediaries Controls, or is Controlled by, or is under common Control with, such first Person.  Unless the context
              otherwise clearly requires, any reference to an “Affiliate” is a reference to an Affiliate of the Company.

           

          “Agreement” means this Note Purchase Agreement, including all Schedules attached to
              this Agreement.

           

          “Anti-Corruption Laws” means any law or regulation in a U.S. or any non-U.S.
              jurisdiction regarding bribery or any other corrupt activity, including the U.S. Foreign Corrupt Practices Act and the U.K. Bribery Act 2010.

           

          “Anti-Money Laundering Laws” means any law or regulation in a U.S. or any non-U.S.
              jurisdiction regarding money laundering, drug trafficking, terrorist-related activities or other money laundering predicate crimes, including the Currency and Foreign Transactions Reporting Act of 1970 (otherwise known as the Bank Secrecy
              Act) and the USA PATRIOT Act.

           

          “Blocked Person” means (a) a Person whose name appears on the list of Specially
              Designated Nationals and Blocked Persons published by OFAC, (b) a Person, entity, organization, country or regime that is blocked or a target of sanctions that have been imposed under U.S. Economic Sanctions Laws or (c) a Person that is an
              agent, department or instrumentality of, or is otherwise beneficially owned by, controlled by or acting on behalf of, directly or indirectly, any Person, entity, organization, country or regime described in clause (a) or (b).

           

          “Business Day” means (a) for the purposes of Section 8.6 only, any day other than a
              Saturday, a Sunday or a day on which commercial banks in New York City are required or authorized to be closed, and (b) for the purposes of any other provision of this Agreement, any day other than a Saturday, a Sunday or a day on which
              commercial banks in New York, New York or York, Pennsylvania are required or authorized to be closed.

           

          “Capitalized Lease” shall mean any lease, the obligation for Rentals with respect to
              which is required to be capitalized on a balance sheet of the lessee in accordance with generally accepted accounting principles.

           

          “Capitalized Rentals” shall mean as of the date of any determination the amount at which
              the aggregate Rentals due and to become due under all Capitalized Leases under which the Company is a lessee would be reflected as a liability on a balance sheet of the Company.

           

          “Closing” is defined in Section 3.

          

            
            
              Schedule A

              (to Note Purchase Agreement)

            

          

          
            
              

          

          
          “Code” means the Internal
              Revenue Code of 1986 and the rules and regulations promulgated thereunder from time to time.

           

          “Company” is defined in the first paragraph of this Agreement.

           

          “Confidential Information” is defined in Section 20.

           

          “Control” means the possession, directly or indirectly, of the power to direct or cause
              the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise; and the terms “Controlled” and “Controlling”
              shall have meanings correlative to the foregoing. 

           

          “Controlled Entity” means (a) any of the Subsidiaries of the Company and any of their or
              the Company’s respective Controlled Affiliates and (b) if the Company has a parent company, such parent company and its Controlled Affiliates.

           

          “Default” means an event or condition the occurrence or existence of which would, with
              the lapse of time or the giving of notice or both, become an Event of Default.

           

          “Default Rate” means that rate of interest per annum that is the greater of (a) 2% above
              the rate of interest stated in clause (a) of the first paragraph of the Notes or (b) 2% over the rate of interest publicly announced by PNC Bank in New York, New York as its “base” or “prime” rate, but in no event in excess of the maximum
              rate of interest permitted by applicable law.

           

          “Disclosure Documents” is defined in Section 5.3.

           

          “EDGAR” means the SEC’s Electronic Data Gathering, Analysis and
              Retrieval System or any successor SEC electronic filing system for such purposes.

           

          “Environmental Laws” means any and all federal, state, local, and foreign statutes,
              laws, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants, franchises, licenses, agreements or governmental restrictions relating to pollution and the protection of the environment or the release of any
              materials into the environment, including those related to Hazardous Materials.

           

          “ERISA” means the Employee Retirement Income Security Act of 1974 and the rules and
              regulations promulgated thereunder from time to time in effect. 

           

          “ERISA Affiliate” means any trade or business (whether or not incorporated) that is
              treated as a single employer together with the Company under section 414 of the Code.

           

          “Excepted Encumbrances” shall mean any of the following:  

           

          (a)    liens for taxes, assessments or governmental charges not delinquent and liens for workers’ compensation awards and similar obligations not delinquent and undetermined
            liens or charges incidental to construction;

          

          

          
            A - 2

            
              

          

          (b)   any liens securing Indebtedness neither assumed nor guaranteed by the Company on which it customarily pays interest, existing in or relating to real estate acquired by
            the Company for transmission, distribution or right‐of‐way purposes;

           

          (c)   easements or reservations in any property of the Company created for the purpose of roads, railroads, railroad side tracks, water and gas transmission and distribution
            mains, conduits, water power rights of the Commonwealth of Pennsylvania or others, building and use restrictions and defects of title to, or leases of, any parts of the property of the Company which do not in the opinion of the Company’s
            counsel materially impair the use of the property as an entirety in the operation of the business of the Company;

           

          (d)   undetermined liens and charges incidental to current construction, including mechanics’, laborers’, materialmen’s and similar liens not delinquent;

           

          (e)    any obligations or duties affecting the property of the Company to any municipality or public authority with respect to any franchise, grant, license, permit or
            certificate;

           

          (f)    rights reserved to or vested in any municipality or public authority to control or regulate any property of the Company or to use such property in a manner which does
            not materially impair the use of such property for the purposes for which it is held by the Company; 

           

          (g)    judgments in course of appeal or otherwise in contest and secured by sufficient bond or security; or

           

          (h)   any right of set-off or banker’s lien in favor of any bank lender or any security interest in favor of any bank lender in deposits, moneys, securities or other property
            in the possession of or on deposit with, or in transit to, such bank lender or any of its affiliates.

           

          “Event of Default” is defined in Section 11.

           

          “FATCA” means (a) sections 1471 through 1474
              of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), together with any current or future regulations or official interpretations
              thereof, (b) any treaty, law or regulation of any other jurisdiction, or relating to an intergovernmental agreement between the United States of America and any other jurisdiction, which (in either case) facilitates the implementation of the foregoing clause (a), and (c) any agreements entered into pursuant to section 1471(b)(1) of the Code. 

           

          “Form 10‐K” is defined in Section 7.1(b).

           

          “Form 10‐Q” is defined in Section 7.1(a).

          

          

          
            A - 3

            
              

          

          “Funded Debt” of any Person shall mean (a) all Indebtedness for borrowed money or which
              has been incurred in connection with the acquisition of assets in each case having a final maturity of one or more than one year from the date of origin thereof (or which is renewable or extendible at the option of the obligor for a period or
              periods more than one year from the date of origin), including all payments in respect thereof that are required to be made within one year from the date of any determination of Funded Debt and (b) all Guaranties of such Indebtedness
              described in clause (a).

           

          “GAAP” means (a) generally accepted accounting principles as in effect from time to time
              in the United States of America and (b) for purposes of Section 9.6, with respect to any Subsidiary, generally accepted accounting principles (including International Financial Reporting Standards, as applicable) as in effect from time to
              time in the jurisdiction of organization of such Subsidiary.

           

          “Governmental Authority” means

           

          (a)      the government of

             

          

          (i)       the United States of America or any state or other political subdivision thereof, or

           

          (ii)     any other jurisdiction in which the Company or any Subsidiary conducts all or any part of its business, or which asserts jurisdiction over any properties of the
            Company or any Subsidiary, or

           

          (b)      any entity exercising executive, legislative, judicial, regulatory or administrative functions of, or pertaining to, any such government.

           

          “Governmental Official” means any governmental official or employee, employee of any
              government-owned or government-controlled entity, political party, any official of a political party, candidate for political office, official of any public international organization or anyone else acting in an official capacity.

           

          “Guaranty” means, with respect to any Person, any obligation (except the endorsement in
              the ordinary course of business of negotiable instruments for deposit or collection) of such Person guaranteeing or in effect guaranteeing any indebtedness, dividend or other obligation of any other Person in any manner, whether directly or
              indirectly, including obligations incurred through an agreement, contingent or otherwise, by such Person:

           

          (a)     to purchase such indebtedness or obligation or any property constituting security therefor;

           

          (b)    to advance or supply funds (i) for the purchase or payment of such indebtedness or obligation, or (ii) to maintain any working capital or other balance sheet condition
            or any income statement condition of any other Person or otherwise to advance or make available funds for the purchase or payment of such indebtedness or obligation;

          

          

          
            A - 4

            
              

          

          (c)     to lease properties or to purchase properties or services primarily for the purpose of assuring the owner of such indebtedness or obligation of the ability of any
            other Person to make payment of the indebtedness or obligation; or

           

          (d)    otherwise to assure the owner of such indebtedness or obligation against loss in respect thereof.

           

          In any computation of the indebtedness or other liabilities of the obligor under any Guaranty, the indebtedness or other obligations that are the subject of such Guaranty shall be assumed to be direct obligations
            of such obligor.

           

          “Hazardous Materials” means any and all pollutants, toxic or hazardous wastes or other
              substances that might pose a hazard to health and safety, the removal of which may be required or the generation, manufacture, refining, production, processing, treatment, storage, handling, transportation, transfer, use, disposal, release,
              discharge, spillage, seepage or filtration of which is or shall be restricted, prohibited or penalized by any applicable law, including asbestos, urea formaldehyde foam insulation, polychlorinated biphenyls, petroleum, petroleum products,
              lead based paint, radon gas or similar restricted, prohibited or penalized substances.

           

          “holder” means, with respect to any Note, the Person in whose name such Note is
              registered in the register maintained by the Company pursuant to Section 13.1, provided, however, that if such Person is a nominee, then for the purposes of Sections 7, 12, 17.2 and 18 and any related
              definitions in this Schedule A, “holder” shall mean the beneficial owner of such Note whose name and address appears in such register.

           

          “INHAM Exemption” is defined in Section 6.2(e).

           

          “Indebtedness” with respect to any Person means, at any time, without duplication,

           

          (a)    its liabilities for borrowed money and its redemption obligations in respect of mandatorily redeemable Preferred Stock;

           

          (b)    its liabilities for the deferred purchase price of property acquired by such Person (excluding accounts payable arising in the ordinary course of business but
            including all liabilities created or arising under any conditional sale or other title retention agreement with respect to any such property);

           

          (c)    (i) all liabilities appearing on its balance sheet in accordance with GAAP in respect of Capitalized Leases and (ii) all liabilities which would appear on its balance
            sheet in accordance with GAAP in respect of Synthetic Leases assuming such Synthetic Leases were accounted for as Capitalized Leases;

           

          (d)     all liabilities for borrowed money secured by any Lien with respect to any property owned by such Person (whether or not it has assumed or otherwise become liable for
            such liabilities);

          

          

          
            A - 5

            
              

          

          (e)    all its liabilities in respect of letters of credit or instruments serving a similar function issued or accepted for its account by banks and other financial
            institutions (whether or not representing obligations for borrowed money);

           

          (f)     the aggregate Swap Termination Value of all Swap Contracts of such Person; and

           

          (g)    any Guaranty of such Person with respect to liabilities of a type described in any of clauses (a) through (f) hereof.  

           

          Indebtedness of any Person shall include all obligations of such Person of the character described in clauses (a) through (g) to the extent such Person remains legally liable in respect thereof notwithstanding
            that any such obligation is deemed to be extinguished under GAAP.

           

          “Institutional Investor” means (a) any Purchaser of a Note, (b) any holder of a Note
              holding (together with one or more of its affiliates) more than 5% of the aggregate principal amount of the Notes then outstanding, (c) any bank, trust company, savings and loan association or other financial institution, any pension plan,
              any investment company, any insurance company, any broker or dealer, or any other similar financial institution or entity, regardless of legal form, and (d) any Related Fund of any holder of any Note.

           

          “Make-Whole Amount” is defined in Section 8.6.

           

          “Material” means material in relation to the business, operations, affairs, financial
              condition, assets or properties of the Company and its Subsidiaries taken as a whole.

           

          “Material Adverse Effect” means a material adverse effect on (a) the business,
              operations, affairs, financial condition, assets or properties of the Company and its Subsidiaries taken as a whole, (b) the ability of the Company to perform its obligations under this Agreement and the Notes, (c) the ability of any
              Subsidiary Guarantor to perform its obligations under its Subsidiary Guaranty, or (d) the validity or enforceability of this Agreement, the Notes or any Subsidiary Guaranty.

           

          “Material Credit Facility” means, as to the Company and its Subsidiaries, 

           

          (a)  the $50,000,000 revolving line of credit from Fulton Bank, N.A., including any renewals, extensions, amendments, supplements, restatements, replacements or refinancing
            thereof; and 

           

          (b)    any other agreement creating or evidencing indebtedness for borrowed money entered into on or after the date of Closing by the Company or any Subsidiary, or in respect
            of which the Company or any Subsidiary is an obligor or otherwise provides a guarantee or other credit support (“Credit Facility”), in a principal amount outstanding or available for borrowing equal to or
            greater than $40,000,000 (or the equivalent of such amount in the relevant currency of payment, determined as of the date of the closing of such facility based on the exchange rate of such other currency); and if no Credit Facility equals or
            exceeds such amount, then the largest Credit Facility shall be deemed to be a Material Credit Facility but only if it is in a principal amount outstanding or available for borrowing equal to or greater than $10,000,000.  

          

            

          
            A - 6

            
              

          

          “Maturity Date” is defined in the first paragraph of each Note.

           

          “Multiemployer Plan” means any Plan that is a “multiemployer plan” (as such term is
              defined in section 4001(a)(3) of ERISA).

           

          “NAIC” means the National Association of Insurance Commissioners.

           

          “Non-U.S. Plan” means any plan, fund or other similar program that (a) is established or
              maintained outside the United States of America by the Company or any Subsidiary primarily for the benefit of employees of the Company or one or more Subsidiaries residing outside the United States of America, which plan, fund or other
              similar program provides, or results in, retirement income, a deferral of income in contemplation of retirement or payments to be made upon termination of employment, and (b) is not subject to ERISA or the Code.

           

          “Notes” is defined in Section 1.

           

          “OFAC” means the Office of Foreign Assets Control of the United States Department of the
              Treasury.

           

          “OFAC Sanctions Program” means any economic or trade sanction that OFAC is responsible
              for administering and enforcing.  A list of OFAC Sanctions Programs may be found at http://www.treasury.gov/resource-center/sanctions/Programs/Pages/Programs.aspx.

           

          “Officer’s Certificate” means a certificate of a Senior Financial Officer or of any
              other officer of the Company whose responsibilities extend to the subject matter of such certificate.

           

          “PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA.

           

          “Person” means an individual, partnership, corporation, limited liability company,
              association, trust, unincorporated organization, business entity or Governmental Authority.

           

          “Plan” means an “employee benefit plan” (as defined in section 3(3) of ERISA) subject to
              Title I of ERISA that is or, within the preceding five years, has been established or maintained, or to which contributions are or, within the preceding five years, have been made or required to be made, by the Company or any ERISA Affiliate
              or with respect to which the Company or any ERISA Affiliate may have any liability.

           

          “Plant Account” shall mean the plant account under the Pennsylvania Public Utilities
              Commission Uniform System of Accounts for Water Utilities dated November 21, 1946, as the same may be amended from time to time.

          

          

          
            A - 7

            
              

          

          “Preferred Stock” means any class of capital stock of a Person that is preferred over
              any other class of capital stock (or similar equity interests) of such Person as to the payment of dividends or the payment of any amount upon liquidation or dissolution of such Person.

           

           “Presentation” is defined in Section 5.3.

           

          “Priority Debt” means Indebtedness of the Company or any Subsidiary secured by assets
              not otherwise permitted by clauses (i) through (iv) of Section 10.5(a) or as an Excepted Encumbrance and, without duplication, the aggregate amount of Indebtedness of all Subsidiaries (other than Subsidiary Guarantors).

           

          “property” or “properties” means, unless
              otherwise specifically limited, real or personal property of any kind, tangible or intangible, choate or inchoate.

           

          “PTE” is defined in Section 6.2(a).

           

          “Purchaser” or “Purchasers” means each of the
              purchasers that has executed and delivered this Agreement to the Company and such Purchaser’s successors and assigns (so long as any such assignment complies with Section 13.2), provided, however,
              that any Purchaser of a Note that ceases to be the registered holder or a beneficial owner (through a nominee) of such Note as the result of a transfer thereof pursuant to Section 13.2 shall cease to be included within the meaning of
              “Purchaser” of such Note for the purposes of this Agreement upon such transfer.

           

          “Purchaser Schedule” means the Purchaser Schedule to this Agreement listing the
              Purchasers of the Notes and including their notice and payment information.

           

          “Qualified Institutional Buyer” means any Person who is a “qualified institutional
              buyer” within the meaning of such term as set forth in Rule 144A(a)(1) under the Securities Act.

           

          “QPAM Exemption” is defined in Section 6.2(d).

           

          “Related Fund” means, with respect to any holder of any Note, any fund or entity that
              (a) invests in Securities or bank loans, and (b) is advised or managed by such holder, the same investment advisor as such holder or by an affiliate of such holder or such investment advisor.

           

          “Rentals” shall mean and include all fixed rents (including as such all payments which the lessee is obligated to make to the lessor on termination of the lease or surrender of the Property) payable by the Company, as lessee
              or sublessee under a lease of real or personal property, but shall be exclusive of any amounts required to be paid by the Company (whether or not designated as rents or additional rents) on account of maintenance, repairs, insurance, taxes
              and similar charges.  Fixed rents under any so-called “percentage leases” shall be computed solely on the basis of the minimum rents, if any, required to be paid by the lessee regardless of sales
              volume or gross revenues.

          

          

          
            A - 8

            
              

          

          “Required Holders” means at any time on or after the Closing, the holders of more than
              50% in principal amount of the Notes at the time outstanding (exclusive of Notes then owned by the Company or any of its Affiliates).

           

          “Responsible Officer” means any Senior Financial Officer and any other officer of the
              Company with responsibility for the administration of the relevant portion of this Agreement.

           

          “Restricted Payment” is defined in Section 10.8.

           

          “Seasonal Indebtedness” as of the date of any determination thereof shall mean (a) all
              Indebtedness for money borrowed or which has been incurred in connection with the acquisition of assets in each case other than Funded Debt and (b) Guaranties of Seasonal Indebtedness of others.

           

          “SEC” means the Securities and Exchange Commission of the United States of America.

           

          “Securities” or “Security” shall have the
              meaning specified in section 2(1) of the Securities Act. 

           

          “Securities Act” means the Securities Act of 1933 and the rules and regulations
              promulgated thereunder from time to time in effect.

           

          “Senior Financial Officer” means the chief financial officer, principal accounting
              officer, treasurer or comptroller of the Company.

           

          “Significant Subsidiary” means at any time any Subsidiary that would at such time
              constitute a “significant subsidiary” (as such term is defined in Regulation S-X of the SEC as in effect on the date of the Closing) of the Company.

           

          “Source” is defined in Section 6.2.

           

          “State Sanctions List” means a list that is adopted by any state Governmental Authority
              within the United States of America pertaining to Persons that engage in investment or other commercial activities in Iran or any other country that is a target of economic sanctions imposed under U.S. Economic Sanctions Laws.

           

          “Subsidiary” means, as to any Person, any other Person in which such first Person or one
              or more of its Subsidiaries or such first Person and one or more of its Subsidiaries owns sufficient equity or voting interests to enable it or them (as a group) ordinarily, in the absence of contingencies, to elect a majority of the
              directors (or Persons performing similar functions) of such second Person, and any partnership or joint venture if more than a 50% interest in the profits or capital thereof is owned by such first Person or one or more of its Subsidiaries or
              such first Person and one or more of its Subsidiaries (unless such partnership or joint venture can and does ordinarily take major business actions without the prior approval of such Person or one or more of its Subsidiaries).  Unless the
              context otherwise clearly requires, any reference to a “Subsidiary” is a reference to a Subsidiary of the Company.

          

          

          
            A - 9

            
              

          

          “Subsidiary Guarantor” means each Subsidiary that has executed and delivered a
              Subsidiary Guaranty.

           

          “Subsidiary Guaranty” is defined in Section 9.7(a).

           

          “Substitute Purchaser” is defined in Section 21.

           

          “SVO” means the Securities Valuation Office of the NAIC.

           

          “Swap Contract” means (a) any and all interest rate swap transactions, basis swap
              transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options
              or forward foreign exchange transactions, cap transactions, floor transactions, currency options, spot contracts or any other similar transactions or any of the foregoing (including any options to enter into any of the foregoing), and (b) any
              and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc. or any
              International Foreign Exchange Master Agreement.

           

          “Swap Termination Value” means, in respect of any one or more Swap Contracts, after
              taking into account the effect of any legally enforceable netting agreement relating to such Swap Contracts, (a) for any date on or after the date such Swap Contracts have been closed out and termination value(s) determined in accordance
              therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amounts(s) determined as the mark-to-market values(s) for such Swap Contracts, as determined based upon one or more mid-market or other
              readily available quotations provided by any recognized dealer in such Swap Contracts.

           

          “Synthetic Lease” means, at any time, any lease (including leases that may be terminated
              by the lessee at any time) of any property (a) that is accounted for as an operating lease under GAAP and (b) in respect of which the lessee retains or obtains ownership of the property so leased for U.S. federal income tax purposes, other
              than any such lease under which such Person is the lessor.

           

          “United States Person” has the meaning set forth in Section 7701(a)(30) of the Code.

           

          “USA PATRIOT Act” means United States Public Law 107-56, Uniting and Strengthening
              America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT ACT) Act of 2001 and the rules and regulations promulgated thereunder from time to time in effect.

           

          “U.S. Economic Sanctions Laws” means those laws, executive orders, enabling legislation
              or regulations administered and enforced by the United States pursuant to which economic sanctions have been imposed on any Person, entity, organization, country or regime, including the Trading with the Enemy Act, the International Emergency
              Economic Powers Act, the Iran Sanctions Act, the Sudan Accountability and Divestment Act and any other OFAC Sanctions Program.

          

          

          
            A - 10

            
              

          

          “Voting Stock” means Securities of any class or classes, the holders of which are
              ordinarily, in the absence of contingencies, entitled to elect the corporate directors (or Persons performing similar functions). 

           

          “Wholly-Owned Subsidiary” means, at any time, any Subsidiary all of the equity interests
              (except directors’ qualifying shares) and voting interests of which are owned by any one or more of the Company and the Company’s other Wholly-Owned Subsidiaries at such time.

          

          

          
            A - 11

            
              

          

          [Form of Note]

           

          This Note has not been registered under the Securities Act of 1933, as amended, and may not be transferred, sold or otherwise disposed of except while registration
            under said Act is in effect or pursuant to an exemption from registration under said Act or if said Act does not apply.

           

          The York Water Company

           

          3.24% Senior Note Due September 30, 2050

           

          

          
            	
                    No. R__

                    

                  	[Date]
	$[_______]	PPN 987184 E#1

          

          

          For Value Received, the undersigned, The York Water Company (herein called the “Company”), a corporation organized and existing under the laws of the Commonwealth of Pennsylvania, hereby promises to pay to [____________], or registered assigns, the principal sum of
              [_____________________] Dollars (or so much thereof as shall not have been prepaid) on September 30, 2050 (the “Maturity

                Date”), with interest (computed on the basis of a 360-day year of twelve 30‐day months) (a) on the unpaid balance hereof at the rate of 3.24% per annum from the date hereof, payable semiannually, on the 30th day of March and
              September in each year, commencing with the March or September next succeeding the date hereof, and on the Maturity Date, until the principal hereof shall have become due and payable, and (b) to the extent permitted by law, (x) on any overdue
              payment of interest and (y) during the continuance of an Event of Default, on such unpaid balance and on any overdue payment of any Make-Whole Amount, at the Default Rate, payable semiannually as aforesaid (or, at the option of the registered
              holder hereof, on demand).

           

          Payments of principal of, interest on and any Make-Whole Amount with respect to this Note are to be made in lawful money of the United States of America at PNC Bank or at such other place as
            the Company shall have designated by written notice to the holder of this Note as provided in the Note Purchase Agreement referred to below.

           

          This Note is one of a series of Senior Notes (herein called the “Notes”) issued pursuant to the Note Purchase Agreement, dated September 30, 2020 (as
            from time to time amended, the “Note Purchase Agreement”), between the Company and the respective Purchasers named therein and is entitled to the benefits thereof.  Each holder of this Note will be
            deemed, by its acceptance hereof, to have (i) agreed to the confidentiality provisions set forth in Section 20 of the Note Purchase Agreement and (ii) made the representations set forth in Section 6 of the Note Purchase Agreement.  Unless
            otherwise indicated, capitalized terms used in this Note shall have the respective meanings ascribed to such terms in the Note Purchase Agreement.

          
             

              

            
              
                Schedule 1

                (to Note Purchase Agreement)

              

              

          

          
            
              

          

          
          This Note is a registered Note and, as provided in the Note Purchase Agreement, upon surrender of this Note for registration of transfer accompanied by a written instrument of transfer duly
            executed, by the registered holder hereof or such holder’s attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, the transferee.  Prior to due presentment for registration
            of transfer, the Company may treat the Person in whose name this Note is registered as the owner hereof for the purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary.

           

          This Note is subject to prepayment, in whole or from time to time in part, at the times and on the terms specified in the Note Purchase Agreement, but not otherwise.

           

          If an Event of Default occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable Make-Whole
            Amount) and with the effect provided in the Note Purchase Agreement.

           

          This Note shall be construed and enforced in accordance with, and the rights of the Company and the holder of this Note shall be governed by, the law of the State of New York excluding
            choice-of-law principles of the law of such State that would permit the application of the laws of a jurisdiction other than such State.

          

          

          	 	
                  The York Water Company

                
	 	 	 
	 	
                  By

                	 
	 	 	
                  Its

                

           

          
            - 2-

            
              

          

          Form of Opinion of Special Counsel

            For The Company

           

          The following opinions are to be provided by special counsel for the Company, subject to customary assumptions, limitations, qualifications and exceptions.  All capitalized terms used herein without definition
            shall have the meanings ascribed thereto in the Note Purchase Agreement.

          

          

           

          1.      The Company is a corporation presently subsisting under the laws of Pennsylvania and has the corporate power and authority to conduct its business as currently conducted and currently
            proposed to be conducted, to execute and deliver the Note Purchase Agreement and the Notes and to perform the provisions thereof.

           

          2.      The Note Purchase Agreement has been duly authorized, executed and delivered by the Company and constitutes a legal, valid and binding agreement of the Company, enforceable against the
            Company in accordance with its terms.

           

          3.      The Notes being purchased by you at the Closing have been duly authorized, executed and delivered by the Company and constitute legal, valid and binding obligations of the Company,
            enforceable against the Company in accordance with their terms.

           

          4.      No consent, approval or authorization of, or registration, filing or declaration with, the United States of America or the Commonwealth of Pennsylvania or any agency thereof is required
            in connection with the execution, delivery or performance by the Company of the Note Purchase Agreement or the Notes, except for the approval required from the Pennsylvania Public Utility Commission.

           

          5.       Based upon, and assuming the accuracy of, the representations and warranties of the Company and
              the Purchasers set forth in the Agreement and the confirmations of Janney Montgomery Scott LLC in that certain offeree letter dated the date hereof, and assuming that no general solicitation or general advertising has been used in connection
              with the offering of the Notes, it was not necessary in connection with the offering, sale and delivery of the Notes purchased by you at the Closing, under the circumstances contemplated by the Note Purchase Agreement, to register said Notes
              under the Securities Act of 1933 or to qualify an indenture in respect of the Notes under the Trust Indenture Act of 1939, it being understood that no opinion is expressed as to any subsequent resale of the Notes.

           

          
            6.        The execution, delivery and performance by the Company of the Note Purchase Agreement and the Notes does not and will not (a) contravene, result in any breach of, or constitute a default under, or
              result in the creation of any Lien in respect of any property of the Company or any Subsidiary under, any indenture, mortgage, deed of trust, loan, or credit agreement evidencing or governing the terms of any Indebtedness of the Company that
              is identified in Schedule 5.15 to the Note Purchase Agreement, or the articles of incorporation or bylaws of the Company, (b) conflict with or result in a breach of any of the terms, conditions or provisions of any order, judgment, decree or
              ruling of any court, arbitrator or Governmental Authority the United States of America, the Commonwealth of Pennsylvania or the State of New York that is known to us and that is applicable to the Company or (c) violate any provision of any
              statute or other rule or regulation of any Governmental Authority of the United States of American, the Commonwealth of Pennsylvania or the State of New York that is applicable to the Company.

            

            

            

            
              Schedule 4.4(a)

                  (to Note Purchase Agreement)

            

          

          
            
              

          

          
          7.       The Company is not an “investment company” or, to the knowledge of such counsel, a Person directly or indirectly controlled by or acting on behalf of an “investment company” within the
            meaning of the Investment Company Act of 1940.

           

          8.      None of the transactions contemplated by the Note Purchase Agreement (including, without limitation, the use of the proceeds from the sale of the Notes) will violate or result in a
            violation of Regulation T, U or X of the Board of Governors of the United States Federal Reserve System, 12 CFR, Part 220, Part 221 and Part 224, respectively.

          

          

          
            - 2- 

            
              

          

          Form of Opinion of Special Counsel

            For The Purchasers

           

          [To Be Provided on a Case by Case Basis]

           

          

          
            Schedule 4.4(b)

                (to Note Purchase Agreement)

             

            

          

          
            
              

          

          Schedule 5.3

           

          Disclosure Materials 

           

          

          
            	
                    •

                  	
                    All public filings made by the Company with the SEC in 2020 prior to September 18, 2020

                  

          

          

          

          
            Schedule 5.3

              (to Note Purchase Agreement)

             

            

          

          
            
              

          

          Schedule 5.4

           

          Affiliates and Directors of the Company

           

          
            	
                    (i)

                  	
                    Affiliates: None.

                  

          

          

          

          
            	
                    (ii)

                  	
                    Company’s Directors and Senior Officers:

                  

          

          

          

          Directors

          

          

          James H. Cawley, Esq.1

          Cynthia A. Dotzel, CPA

          Michael W. Gang, Esq.

          Joseph T. Hand

          Jeffrey R. Hines, P.E.

          George W. Hodges

          George Hay Kain, III

          Jody L. Keller, SPHR

          Erin C. McGlaughlin

          Robert P. Newcomer

          Steven R. Rasmussen, CPA

          Ernest J. Waters

          

          

          Officers

          

          

          Joseph T. Hand, President and Chief Executive Officer

          Mark A. Wheeler, Chief Operating Officer

          Matthew E. Poff, CPA, Chief Financial Officer

          Vernon L. Bracey, Vice President of Customer Service

          Natalee Colón, SPHR, Vice President of Human Resources

          Mark J. Hardman, Vice President of Technology

          Mark S. Snyder, P.E., Vice President of Engineering

          Alexandra C. Chiaruttini, Chief Administrative Officer and General Counsel2

          

          

          

          
            	
                    1

                  	
                    On September 12, 2020, James H. Cawley, Esq. will retire from the Board of Directors of The York Water Company pursuant to the Company’s retirement policy.

                  

          

           

          
            	
                    2

                  	
                    Effective October 13, 2020.

                  

          

           

          
            Schedule 5.4

              (to Note Purchase Agreement)

             

            

          

          
            
              

          

          Schedule 5.5

           

          Financial Statements

          

          

          

          
            
              
                	 	
                        •

                      	
                        December 31, 2019 Audited Financial Statements, which include balance sheets as of December 31, 2019 and 2018, and related statements of income, changes in common stockholder’s equity, and cash
                          flows for the years then ended, and the related notes to the financial statements.

                      

                 

                

              

            

          

          
            
              
                	 	
                        •

                      	
                        June 30, 2020 Unaudited Financial Statements, which include condensed balance sheets as of June 30, 2020 and December 31, 2019, and related statements of income, changes in common stockholder’s
                          equity, and cash flows for the six month periods ended June 30, 2020 and June 30, 2019, and the related notes to the interim financial statements.

                      

              

            

            

            

            
              Schedule 5.5

                (to Note Purchase Agreement)

               

              

            

          

          
            
              

          

          Schedule 5.15

           

          Existing Indebtedness of the Company and its Subsidiaries

          

          

          

          

          
            Schedule 5.15

              (to Note Purchase Agreement)Exhibit

Exhibit 10.1

KINGSWAY FINANCIAL SERVICES INC.
2020 EQUITY INCENTIVE PLAN
1.Establishment, Purpose and Duration.  Kingsway Financial Services Inc. (hereinafter referred to as the “Company”) hereby establishes a long-term incentive compensation plan to be known as the 2020 Equity Incentive Plan (hereinafter referred to as the “Plan”), as set forth in this document.  The Plan permits the grant of Nonqualified Stock Options, Incentive Stock Options, Stock Appreciation Rights, Restricted Shares, Restricted Stock Units, Performance Share Awards, Dividend Equivalent Rights, Other Stock-Based Awards and Cash-Based Awards.  The Plan shall become effective upon being approved by shareholders (the “Effective Date”).  The purpose of the Plan is to provide a means through which the Company and its Subsidiaries may attract and retain key personnel and to provide a means whereby current and prospective directors, officers, employees, consultants and advisors of the Company and its Subsidiaries can acquire and maintain an equity interest in the Company, or be paid incentive compensation, which may (but need not) be measured by reference to the value of the Shares, thereby aligning their interests with the long-term success of the Company’s shareholders.  Unless sooner terminated as provided herein, the Plan shall terminate ten (10) years from the Effective Date.  After the Plan is terminated, no further Awards may be granted but Awards previously granted shall remain outstanding in accordance with their applicable terms and conditions and the Plan’s terms and conditions.
2.    Definitions.  As used in the Plan, the following terms shall be defined as set forth below: 
2.1     “Act” means the Securities Exchange Act of the 1934, as amended.  Any reference in the Plan to any section of (or rule promulgated under) the Act shall be deemed to include any rules, regulations or other interpretative guidance under such section or rule, and any amendments or successor provisions to such section, rules, regulations or guidance.
2.2    “Administrator” is defined in Section 4.1.
2.3    “Award” or “Awards” means, individually or collectively, except where referring to a particular category of grant under the Plan, a grant under the Plan of Nonqualified Stock Options, Incentive Stock Options, Stock Appreciation Rights, Restricted Shares, Restricted Stock Units, Performance Share Awards, Cash-Based Awards, Dividend Equivalent Rights or Other Stock-Based Awards, in each case subject to the terms of the Plan.
2.4    “Award Agreement” means an agreement or other instrument setting forth the terms and conditions of an Award that has been duly authorized and approved by the Administrator or its designee.  An Award Agreement may be in an electronic medium (including email or the posting on a web site maintained by the Company or a third party under contract with the Company), may be limited to a notation on the Company’s books and records and, if approved by the Administrator, need not be signed by a representative of the Company or a Participant.
2.5    “Base Price” means the price to be used as the basis for determining the Spread upon the exercise of a Stock Appreciation Right.
2.6    “Beneficial Owner” or “Beneficial Ownership” shall have the meaning ascribed to such term in Rule 13d-3 of the General Rules and Regulations under the Act.
2.7    “Board” means the Board of Directors of the Company.
2.8    “Cash-Based Award” means an Award granted to a Participant as described in Section 12.
2.9    “Change in Control” shall mean any of the following events:
(a)    the acquisition by any Person, including any “person” within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act, of Beneficial Ownership of 50% or more of either (i) the then outstanding Shares or (ii) the combined voting power of the then outstanding securities of the Company entitled to vote generally in the election 

of directors (the “Outstanding Voting Securities”); excluding, however, the following: (1) any acquisition directly from the Company (excluding any acquisition resulting from the exercise of an exercise, conversion or exchange privilege unless the security being so exercised, converted or exchanged was acquired directly from the Company); (2) any acquisition by the Company; (3) any acquisition by an employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company; or (4) any acquisition by any corporation pursuant to a transaction which complies with clauses (i), (ii) and (iii) of Section 2.9(c); provided further, that for purposes of clause (2) of this Section 2.9(a), if any Person (other than the Company or any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company) shall become the Beneficial Owner of 50% or more of the outstanding Shares or 50% or more of the Outstanding Voting Securities by reason of an acquisition by the Company, and such Person shall, after such acquisition by the Company, become the Beneficial Owner of any additional shares of the outstanding Shares or any additional Outstanding Voting Securities and such Beneficial Ownership is publicly announced, such additional Beneficial Ownership shall constitute a Change in Control;
(b)    individuals who, as of the effective date of this Plan, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of such Board; provided that any individual who becomes a director of the Company subsequent to the date hereof whose election, or nomination for election by the Company’s shareholders, was approved by the vote of at least 75% of the directors then comprising the Incumbent Board shall be deemed a member of the Incumbent Board; provided further, that any individual who was initially elected as a director of the Company as a result of an actual or threatened solicitation by a Person other than the Board for the purpose of opposing a solicitation by any other Person with respect to the election or removal of directors, or any other actual or threatened solicitation of proxies or consents by or on behalf of any Person other than the Board shall not be deemed a member of the Incumbent Board; or
(c)    the consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Company (a “Corporate Transaction”); excluding, however, a Corporate Transaction pursuant to which (i) all or substantially all of the individuals or entities who are the Beneficial Owners, respectively, of the outstanding Shares and the Outstanding Voting Securities immediately prior to such Corporate Transaction will beneficially own, directly or indirectly, more than 50% of, respectively, the outstanding shares of common stock, and the combined voting power of the outstanding securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Corporate Transaction (including, without limitation, a corporation which as a result of such transaction owns the Company or all or substantially all of the Company’s assets either directly or indirectly) in substantially the same proportions relative to each other as their ownership, immediately prior to such Corporate Transaction, of the outstanding Shares and the Outstanding Voting Securities, as the case may be, (ii) no Person (other than: the Company; any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company; the corporation resulting from such Corporate Transaction; or any Person which beneficially owned, immediately prior to such Corporate Transaction, directly or indirectly, 50% or more of the outstanding Shares or the Outstanding Voting Securities, as the case may be) will beneficially own, directly or indirectly, 50% or more of, respectively, the outstanding shares of common stock of the corporation resulting from such Corporate Transaction or the combined voting power of the outstanding securities of such corporation entitled to vote generally in the election of directors, and (iii) individuals who were members of the Incumbent Board will constitute at least a majority of the members of the board of directors of the corporation resulting from such Corporate Transaction; or
(d)    the consummation of a plan of complete liquidation or dissolution of the Company.
2.10    “Code” means the Internal Revenue Code of 1986, as amended from time to time.  Reference in the Plan to any section of the Code shall be deemed to include any regulations or other interpretive guidance under such section, and any amendments or successor provisions to such section, regulations or guidance.
2.11    “Committee” means the Committee designated by the Board or a subcommittee thereof, consisting of two or more members of the Board, each of whom may be a “nonemployee director” within the meaning of Rule 16b-3 under the Act and “independent” within the meaning of the rules of the principal stock exchange on which the Shares are then traded.

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2.12    “Consultant” means any natural person, including an advisor, engaged by the Company or any Subsidiary to render bona fide services to such entity (other than in connection with the offer or sale of securities in a capital-raising transaction or to promote or maintain a market for the Company’s securities).
2.13    “Company” means Kingsway Financial Services Inc., a Delaware corporation, or any successor thereto.
2.14    “Disability” means the inability of a participant to continue employment with the Company or a Subsidiary due to a long-term disability for which benefits are claimed or received under an insurance plan established by the Company or a Subsidiary.
2.15     “Dividend Equivalent Right” means Awards granted pursuant to Section 10.
2.16    “Effective Date” means the date on which the Company’s shareholders first approve the Plan.
2.17    “Eligible Person” means an Employee, Non-Employee Director or Consultant.
2.18    “Employee” means any person designated as an employee of the Company or any of its or their Subsidiaries on the payroll records thereof.
2.19     “Family Member” means a Participant’s spouse, parents, children and grandchildren.
2.20    “Fair Market Value” means a price that is based on the opening, closing, actual, high, low, or average selling prices of a Share reported on the New York Stock Exchange or other established stock exchange (or exchanges) on the applicable date, the preceding trading day, the next succeeding trading day, an average of trading days or on any other basis consistent with the requirements of the stock rights exemption under Section 409A of the Code using actual transactions involving Shares, as determined by the Administrator in its discretion.  In the event Shares are not publicly traded at the time a determination of their value is required to be made hereunder, the determination of their Fair Market Value shall be made by the Administrator in such manner as it deems appropriate.  Such definition(s) of Fair Market Value shall be specified in each Award Agreement and may differ depending on whether Fair Market Value is in reference to the grant, exercise, vesting, settlement, or payout of an Award; provided, however, that upon a broker-assisted exercise of an Option, the Fair Market Value shall be the price at which the Shares are sold by the broker.
2.21     “Grant Date” means the date specified by the Administrator on which a grant of an Award shall become effective, which shall not be earlier than the date on which the Administrator takes action with respect thereto.
2.22    “Incentive Stock Option” means any Option that is intended to qualify as an “incentive stock option” under Section 422 of the Code or any successor provision.
2.23    “Non-employee Director” means a member of the Board of the board of directors of a Subsidiary who is not an Employee.
2.24    “Nonqualified Stock Option” means an Option that is not intended to qualify as an Incentive Stock Option.
2.25    “Option” means any option to purchase Shares granted under Section 5.
2.26    “Option Price” means the purchase price payable upon the exercise of an Option.
2.27    “Other Stock-Based Awards” means an equity-based or equity-related Award not otherwise described by the terms of this Plan granted under Section 11.
2.28    “Participant” means an Employee, Non-Employee Director or a Consultant who is selected by the Administrator to participate in the Plan and to receive one or more Awards hereunder, provided that only Employees 

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shall be eligible to receive grants of Incentive Stock Options, and provided further that residents of Canada shall not be eligible for Restricted Share Awards granted pursuant to Section 7.
2.29     “Performance Cycle” means one or more periods of time, which may be of varying and overlapping durations, as the Administrator may select, over which the attainment of one or more Performance Criteria will be measured for the purpose of determining a grantee’s right to and the payment of a Restricted Share Award, Restricted Stock Unit, Performance Share Award or Cash-Based Award.  
2.30    “Performance Criteria” means the criteria that the Administrator selects in its sole discretion for purposes of establishing the Performance Goal or Performance Goals for a Participant with respect to the Performance Cycle for an Award.  The Performance Criteria may be described in terms of Company-wide objectives or objectives that are related to the performance of the individual Participant or an organizational level specified by the Administrator, including, but not limited to, a Subsidiary or unit, division, group of the Company or a Subsidiary.  Performance Criteria may be measured on an absolute or relative basis, including but not limited to performance as measured against a group of peer companies or by a financial market index.
2.31    “Performance Goals” means, with respect to a Restricted Share Award, a Restricted Stock Unit Award, a Performance Share Award or a Cash-Based Award, the specific goal or goals established in writing by the Administrator for the Performance Cycle applicable to such Award.  
2.32    “Performance Share Award” means an Award denominated in either Shares or units granted subject to Performance Goals pursuant to Section 9.
2.33    “Person” means an individual, entity or group.
2.34    “Plan” shall have the meaning set forth in Section 1 above.
2.35    “Restricted Period” means a period of time established under Section 8 with respect to Restricted Stock Units.
2.36    “Restricted Shares” means Shares granted under Section 7 subject to a substantial risk of forfeiture.
2.37    “Restricted Stock Unit” means an Award pursuant to Section 8 of the right to receive Shares at the end of a specified period.
2.38    “Shares” means the shares of the Company’s common stock (and any stock or other securities into which such common stock may be converted or into which it may be exchanged).  Shares issued under Awards may be authorized but unissued or reacquired common stock, including shares repurchased by the Company on the open market or otherwise.
2.39    “Spread” means, in the case of a Stock Appreciation Right, the amount by which the Fair Market Value on the date when any such right is exercised exceeds the Base Price specified in such right.
2.40    “Stock Appreciation Right” means a right granted under Section 6.
2.41    “Subsidiary” means any corporation or other entity (other than the Company) in which the Company has a controlling interest, either directly or indirectly.
2.42    “Substitute Award” means any Award granted or issued to a Participant in assumption or substitution of either outstanding awards or the right or obligation to make future awards by an entity acquired by the Company or a Subsidiary or with which the Company or a Subsidiary combines.
2.43    “Unrestricted Shares” means a grant of Shares free of any Restricted Period, Performance Goals or any substantial risk of forfeiture.  Unrestricted Shares may be granted in respect of past services or other valid 

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consideration, in lieu of cash compensation due to an Employee or in satisfaction of an award granted under another plan sponsored or maintained by the Company or one of its Subsidiaries.
3.    Grant of Awards; Shares Available Under the Plan.
3.1    Grant of Awards.  The Administrator may, from time to time, grant Options, Stock Appreciation Rights, Restricted Shares, Restricted Stock Units, Performance Shares, Dividend Equivalents, Other Equity Awards and/or Cash Based Awards to one or more Eligible Persons.  Participation shall be limited to Eligible Persons who have entered into an Award Agreement or who have received written notification from the Administrator or from a person designated by the Administrator, that they have been selected to participate in the Plan.  
3.2    Number of Shares Reserved for Awards.
(a)    Subject to adjustments as provided in Section 13, the aggregate number of Shares that may be issued pursuant to Awards is 1,600,000 Shares.  All Shares may be issued under any form of Award available under the 
 
Plan, including Nonqualified Stock Options and Incentive Stock Options.  The Company will keep available at all times the number of Shares reasonably required to satisfy then outstanding Awards.
(b)    Except with respect to a maximum of five percent (5%) of the Shares authorized under Section 3.2(a) as of the Effective Date, as may be adjusted under Section 13, and except for the death or disability of the Participant, or a Change in Control, no equity-based Award that vests on the basis of the Participant’s continued employment with the Company shall provide for vesting before the first (1st) anniversary of the Grant Date or, with respect to a Performance Share Award, a Performance Period that is less than twelve (12) months.  Treatment of Awards in cases of death, disability, and Change in Control may be specifically addressed in an individual Award Agreement with the Participant. The restrictions in this Section 3.2(b) on vesting of equity-based Awards that vest on the basis of the Participant’s continued employment with the Company shall not apply to any Award made pursuant to that certain offer letter to Mr. John T. Fitzgerald dated as of September 5, 2018 and filed as Exhibit 10.2 to the Corporation’s Current Report on Form 8-K filed with the SEC on September 10, 2018.
3.3    Share Usage.
(a)    Any Shares related to Awards granted under the Plan that at any time on or after the Effective Date terminate by expiration, forfeiture, cancellation, or otherwise without the issuance of such Shares, are settled in cash in lieu of Shares, or are exchanged with the Administrator’s permission, prior to the issuance of Shares, for Awards not involving Shares, shall be available again for grant under the Plan.  In addition, Restricted Shares that are forfeited shall again be available for grant under the Plan.
(b)    The full number of Nonqualified Stock Options, Incentive Stock Options and Stock Appreciation Rights granted that are to be settled by the issuance of Shares shall be counted against the number of Shares available for award under the Plan, regardless of the number of Shares actually issued upon settlement of any such Award.
(c)    Any Shares withheld to satisfy tax withholding obligations on an Award issued under the Plan, Shares tendered to pay the exercise price of an Award under the Plan, and Shares repurchased on the open market with the proceeds of an Option exercise will not be eligible to be again available for grant under the Plan.
(d)    Substitute Awards shall not be counted against the Shares available for granting Awards under the Plan.
4.    Plan Administration.
4.1    Committee.  Subject to the provisions of this Section 4, the Plan shall be administered by the Committee.  In the absence of a designation to the contrary by the Board, the Compensation & Management Resources 

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Committee shall serve as the Committee and as the Administrator.  The interpretation and construction by the Administrator of any provision of the Plan or of any Award Agreement and any determination by the Administrator pursuant to any provision of the Plan or any such agreement, notification or document shall be final and conclusive.  No member of the Administrator shall be liable to any person for any such action taken or determination made in good faith.
4.2    Terms and Conditions of Awards.  Subject to the provisions of the Plan and applicable law, the Administrator shall have final discretion, responsibility and authority to:
(a)    designate Participants;
(b)    determine when Awards are to be granted to Participants;
(c)    determine the type and number of Awards to be granted, the number of Shares to which an Award may relate, and the applicable terms, conditions, and restrictions, including the length of time for which any restriction shall remain in effect;
(d)    determine and modify from time to time the terms and conditions, including restrictions, not inconsistent with the terms of the Plan, of any Award, which terms and conditions may differ among individual Awards and Participants, and to approve the form of written instruments evidencing the Awards;
(e)    subject to Sections 5.6 and 18.9, to extend at any time the period in which Options may be exercised;
(f)    establish and administer Performance Goals and Performance Cycles relating to any Award;
(g)    determine the rights of Participants with respect to an Award upon termination of employment or service as a director;
(h)    subject to the applicable provisions of the Code, to determine at any time whether, to what extent, and under what circumstances distribution or the receipt of Shares and other amounts payable with respect to an Award shall be deferred and to what extent the Company shall pay or credit amounts constituting interest (at rates determined by the Administrator) or dividends or deemed dividends on such deferrals;
(i)    determine whether, to what extent, and under what circumstances an Award may be settled, cancelled, forfeited, exchanged, or surrendered;
(j)    accelerate the vesting of an Award; provided, however, that in no event shall any Award’s vesting be accelerated other than in connection with the death or disability of the Participant holding such Award or on a Change in Control as provided in Section 14 below; provided further, however, that this restriction will be inapplicable to Awards representing no more than 5% of the total Shares authorized for issuance under the Plan;
(k)    interpret the terms and provisions of Award Agreements;
(l)    at any time to adopt, alter and repeal such rules, guidelines and practices for administration of the Plan and for its own acts and proceedings as it shall deem advisable;
(m)    decide all disputes arising in connection with the Plan;
(n)    amend or revise the terms of any Awards to be granted to certain Participants in order to comply with applicable foreign law requirements;
(o)    provide for forfeiture of outstanding Awards and recapture of realized gains and other realized value in such events as determined by the Administrator; and

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(p)    make all other determinations deemed necessary or advisable for the administration of the Plan.
All decisions and interpretations of the Administrator shall be binding on all persons, including the Company and Participants.  The Administrator may solicit recommendations from the Company’s Chief Executive Officer with respect to the grant of Awards under the Plan.  The Administrator (or, as permitted under Section 4.3, the Company’s Chief Executive Officer) shall determine the terms and conditions of each Award at the time of grant.  No Participant or any other person shall have any claim to be granted an Award under the Plan at any time, and the Company is not obligated to extend uniform treatment to Participants under the Plan.  The terms and conditions of Awards need not be the same with respect to each Participant.
4.3    Administrator Delegation.  Except to the extent prohibited by applicable law or applicable rules and regulations of any securities exchange on which the securities of the Company are listed or traded, the Administrator may allocate all or any portion of its responsibilities and powers to any one or more of its members and may delegate all or any part of its responsibilities and powers to any person or persons selected by it.  Any such allocation or delegation may be revoked by the Administrator at any time but such action shall not invalidate any prior actions of the Administrator’s delegate or delegates that were consistent with the terms of the Plan.  Without limiting the generality of the foregoing, the Administrator may delegate to one or more officers of the Company or any of its Subsidiaries the authority to act on behalf of the Administrator with respect to any matter, right, obligation, or election that is the responsibility of or that is allocated to the Administrator, and that may be so delegated as a matter of law, except for grants of Awards to persons who are Non-Employee Directors or otherwise are subject to Section 16 of the Act.
4.4    Awards to Non-employee Directors.  Notwithstanding any other provision of the Plan to the contrary, all Awards to Non-employee Directors must be authorized by the Administrator.
4.5    Employee’s Service as Non-Employee Director or Consultant.  An Employee who receives an Award, terminates employment, and immediately thereafter begins performing service as a Non-Employee Director or Consultant shall have such service treated as service as an Employee for purposes of the Award.  The previous sentence shall not apply when (a) the Award is an Incentive Stock Option or (b) prohibited by law.
5.    Options.  The Administrator may authorize grants to Participants of Options to purchase Shares upon such terms and conditions as the Administrator may determine in accordance with the following provisions:  Each Option granted shall be evidenced by an Award Agreement.  Each Option so granted shall be subject to the conditions set forth in this Section 5, and to such other conditions not inconsistent with the Plan as may be reflected in the applicable Award Agreement.  All Options granted under the Plan shall be Nonqualified Stock Options unless the Applicable Award Agreement expressly states that the Option is intended to be an Incentive Stock Option.
5.1    Number of Shares.  Each grant shall specify the number of Shares to which it pertains.
5.2    Option Price.  Each grant shall specify an Option Price per Share, which shall in no event be less than the Fair Market Value per Share on the Grant Date; provided, however, that a Nonqualified Stock Option may be granted with an Option Price lower than the then current Fair Market Value if such Option is granted under Section 13 (with respect to an assumption or substitution for another option).
5.3    Method of Exercise and Form of Payment.  No Shares shall be delivered pursuant to any exercise of an Option until payment in full of the Option Price therefor is received by the Company and the Participant has paid to the Company (or made a satisfactory arrangement to pay) an amount equal to any federal, state, local and non-U.S. income and employment taxes required to be withheld.  Options that have become exercisable may be exercised by delivery of written or electronic notice of exercise to the Company in accordance with the terms of the Option accompanied by payment of the Option Price.  Each grant shall specify the form of consideration to be paid in satisfaction of the Option Price and the manner of payment of such consideration, which may include in the Administrator’s sole discretion:  (a) cash, check or cash equivalent acceptable to the Company, (b) nonforfeitable, unrestricted Shares owned by the Participant which have a Fair Market Value at the time of exercise (as reasonably determined by the Administrator) that is equal to the Option Price (including, pursuant to procedures approved by the Administrator, by means of attestation 

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of ownership of a sufficient number of Shares in lieu of actual delivery of Shares), (c) a net exercise method by whereby the Company withholds from the delivery of the Shares for which the option was exercised that number of Shares having a Fair Market Value equal to the aggregate Option Price of the Shares for which the Option was exercised, (d) to the extent permitted by applicable law, the proceeds of sale from a broker-assisted cashless exercise, (e) any other legal consideration that the Administrator may deem appropriate on such basis as the Administrator may determine in accordance with the Plan or (f) any combination of the foregoing.  For the avoidance of doubt, Participants who receive Options to purchase Shares shall have no legal right to own or receive Shares withheld from delivery upon exercise pursuant to Section 5.3(c), and otherwise shall have no rights in respect of such Shares whether as a shareholder or otherwise.
5.4    Vesting.  Any grant may specify (a) a waiting period or periods before Options shall become exercisable, and (b) permissible dates or periods on or during which Options shall be exercisable, and any grant may provide for the earlier exercise of such rights in the event of a termination of employment.  Vesting may be further conditioned upon the attainment of Performance Goals established by the Administrator.
5.5    Provisions Governing ISOs.  In the case of an Incentive Stock Option, the terms and conditions of any such Award shall be subject to and comply with such rules as may be prescribed by Section 422 of the Code.  If for any reason an Option intended to be an Incentive Stock Option (or any portion thereof) shall not qualify as an Incentive Stock Option, then, to the extent of such non-qualification, such Option or portion thereof shall be regarded as a Nonqualified Stock Option appropriately granted under the Plan, rather than being forfeited.
5.6    Exercise Period.
(a)    Subject to Section 18.9, no Option granted under the Plan may be exercised more than ten years from the Grant Date.
(b)    If the Fair Market Value exceeds the Option Price on the last day that an Option may be exercised under an Award Agreement, the affected Participant shall be deemed to have exercised the vested portion of such Option in a net exercise under Section 5.3(c) above without the requirement of any further action.
5.7    Award Agreement.  Each grant shall be evidenced by an Award Agreement containing such terms and provisions as the Administrator may determine consistent with the Plan.
6.    Stock Appreciation Rights.  The Administrator may authorize grants to Participants of Stock Appreciation Rights.  A Stock Appreciation Right is the right of the Participant to receive from the Company an amount, which shall be determined by the Administrator and shall be expressed as a percentage (not exceeding 100 percent) of the Spread at the time of the exercise of such right.  Any grant of Stock Appreciation Rights under the Plan shall be upon such terms and conditions as the Administrator may determine in accordance with the following provisions:
6.1    Payment in Cash or Shares.  Any grant may specify that the amount payable upon the exercise of a Stock Appreciation Right will be paid by the Company in cash, Shares or any combination thereof or may grant to the Participant or reserve to the Administrator the right to elect among those alternatives.
6.2    Vesting.  Any grant may specify (a) a waiting period or periods before Stock Appreciation Rights shall become exercisable and (b) permissible dates or periods on or during which Stock Appreciation Rights shall be exercisable, and any grant may provide for the earlier exercise of such rights in the event of a termination of employment.  Vesting may be further conditioned upon the attainment of Performance Goals established by the Administrator.
6.3    Exercise Period.  Subject to Section 18.9, no Stock Appreciation Right granted under the Plan may be exercised more than ten years from the Grant Date.  If a Spread exists on the last day that a Stock Appreciation Right may be exercised under an Award Agreement, the affected Participant shall be deemed to have exercised the vested portion of such Stock Appreciation Right without the requirement of any further action.

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6.4    Award Agreement.  Each grant shall be evidenced by an Award Agreement containing such terms and provisions as the Administrator may determine consistent with the Plan.
7.    Restricted Shares.  The Administrator may authorize grants to Participants of Restricted Shares upon such terms and conditions as the Administrator may determine in accordance with the following provisions:
7.1    Transfer of Shares.  Each grant shall constitute an immediate transfer of the ownership of Shares to the Participant in consideration of the performance of services, subject to the substantial risk of forfeiture and restrictions on transfer hereinafter referred to.
7.2    Substantial Risk of Forfeiture.  Each grant shall provide that the Restricted Shares covered thereby shall be subject to a “substantial risk of forfeiture” within the meaning of Section 83 of the Code for a period to be determined by the Administrator on the Grant Date, and any grant or sale may provide for the earlier termination of such risk of forfeiture in the event of a termination of employment.
7.3    Dividend, Voting and Other Ownership Rights.  Unless otherwise determined by the Administrator, an award of Restricted Shares shall entitle the Participant to dividend, voting and other ownership rights (except for any rights to a liquidating distribution) during the period for which such substantial risk of forfeiture is to continue.  Any grant shall require that any or all dividends or other distributions paid on the Restricted Shares during the period of such restrictions be accumulated or reinvested in additional Shares, which shall be subject to the same restrictions as the underlying Award or such other restrictions as the Administrator may determine.
7.4    Restrictions on Transfer.  Each grant shall provide that, during the period for which such substantial risk of forfeiture is to continue, the transferability of the Restricted Shares shall be prohibited or restricted in the manner and to the extent prescribed by the Administrator on the Grant Date.
7.5    Performance-Based Restricted Shares.  Any grant or the vesting thereof may be further conditioned upon the attainment of Performance Goals established by the Administrator in accordance with the applicable provisions of Section 9 regarding Performance Share Awards.
7.6    Award Agreement; Certificates.  Each grant shall be evidenced by an Award Agreement containing such terms and provisions as the Administrator may determine consistent with the Plan.  Unless otherwise directed by the Administrator, all certificates representing Restricted Shares, together with a stock power that shall be endorsed in blank by the Participant with respect to such Shares, shall be held in custody by the Company until all restrictions thereon lapse, whether such certificates are evidenced on paper or electronically.
8.    Restricted Stock Units.  The Administrator may authorize grants of Restricted Stock Units to Participants upon such terms and conditions as the Administrator may determine in accordance with the following provisions:
8.1    Restricted Period.  Each grant shall provide that the Restricted Stock Units covered thereby shall be subject to a Restricted Period, which shall be fixed by the Administrator on the Grant Date, and any grant or sale may provide for the earlier termination of such period in the event of a termination of employment.
8.2    Dividend Equivalent Rights and Other Ownership Rights.  During the Restricted Period, the Participant shall not have any right to transfer any rights under the subject Award and shall not have any rights of ownership in the Shares underlying the Restricted Stock Units, including the right to vote such Shares, but the Administrator may on or after the Grant Date authorize the payment of Dividend Equivalent Rights on such shares in cash or additional Shares on a current, deferred or contingent basis with respect to any or all dividends or other distributions paid by the Company.  Notwithstanding the foregoing, any Dividend Equivalent Rights with respect to dividends paid in stock shall be subject to the same restrictions as the underlying Award.

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8.3    Performance-Based Restricted Share Units.  Any grant or the vesting thereof may be further conditioned upon the attainment of Performance Goals established by the Administrator in accordance with the applicable provisions of Section 9 regarding Performance Share Awards.
8.4    Award Agreement.  Each grant shall be evidenced by an Award Agreement containing such terms and provisions as the Administrator may determine consistent with the Plan.
9.    Performance Share Awards.  The Administrator shall determine whether and to whom Performance Share Awards shall be granted and such terms, limitations and conditions as it deems appropriate in its sole discretion in accordance with the following provisions:
9.1    Number of Performance Share Awards.  Each grant shall specify the number of Shares or share units to which it pertains, which may be subject to adjustment to reflect changes in compensation or other factors.
9.2    Performance Cycle.  The Performance Cycle with respect to each Performance Share Award shall be determined by the Administrator and set forth in the Award Agreement and may be subject to earlier termination in the event of a termination of employment.
9.3    Performance Goals.  Each grant shall specify the Performance Goals that are to be achieved by the Participant and a formula for determining the amount of any payment to be made if the Performance Goals are achieved.
9.4    Payment of Performance Share Awards.  Each grant shall specify the time and manner of payment of Performance Share Awards that shall have been earned.
9.5    Dividend Equivalent Rights.  Dividend Equivalents with respect to an Award of Performance Shares that are based on dividends paid prior to vesting of such Award shall only paid be out to the Participant to the extent that the performance-based vesting conditions are subsequently satisfied and such Award vests.
9.6    Adjustments.  If the Administrator determines after the Performance Goals have been established that a change in the business, operations, corporate structure or capital structure of the Company, or the manner in which it conducts its business, or other events or circumstances render the Performance Goals unsuitable, the Administrator shall have sole discretion to modify such Performance Goals, in whole or in part, as the Administrator deems appropriate and equitable.  The Administrator shall also have the right in its sole discretion to increase or decrease the amount payable at a given level of performance to take into account additional factors that the Administrator may deem relevant to the assessment of individual or corporate performance for the Performance Cycle.  
9.7    Award Agreement.  Each grant shall be evidenced by an Award Agreement containing such terms and provisions as the Administrator may determine consistent with the Plan.
10.    Dividend Equivalent Rights.  A Dividend Equivalent Right is an Award entitling a Participant to receive credits based on cash dividends that would have been paid on the Shares specified in the Dividend Equivalent Right (or other award to which it relates) if such Shares had been issued to and held by the grantee.  A Dividend Equivalent Right may be granted hereunder to any grantee as a component of another Award or as a freestanding award.  The terms and conditions of Dividend Equivalent Rights shall be specified in the Award Agreement.  Dividend equivalents credited to the holder of a Dividend Equivalent Right may be paid currently or may be deemed to be reinvested in additional Shares, which may thereafter accrue additional equivalents.  Any such reinvestment shall be at Fair Market Value on the date of reinvestment or such other price as may then apply under a dividend reinvestment plan sponsored by the Company, if any, Dividend Equivalent Rights may be settled in cash or Shares or a combination thereof, in a single installment or installments.  A Dividend Equivalent Right granted as a component of another Award may provide that such Dividend Equivalent Right shall be settled upon settlement, or payment of, or lapse of restrictions on, such other Award, and that such Dividend Equivalent Right shall expire or be forfeited or annulled under the same conditions as such other Award.  A Dividend Equivalent Right granted as a component of another Award may also contain terms and conditions different from such other Award.  The terms and conditions of any Dividend Equivalent 

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Right shall be evidenced by an Award Agreement containing such terms and provisions as the Administrator may determine consistent with the Plan.
11.    Other Equity Awards.  The Administrator may grant other types of equity-based or equity-related Awards not otherwise described by the terms of the Plan (including the grant or offer for sale of Unrestricted Shares) in such amounts and subject to such terms and conditions as the Administrator shall determine.  Such Awards may involve the transfer of actual Shares to Participants, or payment in cash or otherwise of amounts based on the value of Shares and may include, without limitation, Awards designed to comply with or take advantage of the applicable local laws of jurisdictions other than the United States.
12.    Cash-Based Awards.  The Administrator may, in its sole discretion, grant Cash-Based Awards to key employees in such amounts and upon such terms, and subject to such conditions, as the Administrator shall determine at the time of grant.  The Administrator shall determine the maximum duration of the Cash-Based Award, the Performance Cycle, the amount of cash to which the Cash-Based Award pertains, the Performance Goals and other conditions upon which the Cash-Based Award shall become vested or payable, and such other provisions as the Administrator shall determine.  Each Cash-Based Award shall specify a cash-denominated payment amount, formula or payment ranges as determined by the Administrator.  Payment, if any, with respect to a Cash-Based Award shall be made in accordance with the terms of the Award and shall be made in cash.  
13.    Adjustments.  The Administrator shall make or provide for such adjustments in the: (a) aggregate and per-person limitations specified in Section 3, (b) number of Shares covered by outstanding Awards, (c) Option Price or Base Price applicable to outstanding Options and Stock Appreciation Rights, and (d) kind of Shares available for grant and covered by outstanding Awards (including shares of another issuer), as the Administrator in its sole discretion may in good faith determine to be equitably required in order to prevent dilution or enlargement of the rights of Participants that otherwise would result from (v) any stock dividend, stock split, combination or exchange of Shares, recapitalization, extraordinary cash dividend, or other change in the capital structure of the Company, (w) any merger, consolidation, spin-off, spin-out, split-off, split-up, reorganization, partial or complete liquidation or other distribution of assets (other than a normal cash dividend), issuance of rights or warrants to purchase securities, (x) material changes in accounting practices or principles, (y) acquisitions of stock or property or (z) any other corporate transaction or event having an effect similar to any of the foregoing.  In addition, in the event of any such transaction or event, the Administrator may provide in substitution for any or all outstanding Awards under the Plan such alternative consideration as it may in good faith determine to be equitable under the circumstances and may require in connection therewith the cancellation or surrender of all Awards so replaced.  In the case of Substitute Awards, the Administrator may make such adjustments, not inconsistent with the terms of the Plan, in the terms of Awards as it shall deem appropriate in order to achieve reasonable comparability or other equitable relationship between the assumed awards and the Awards granted under the Plan as so adjusted.
14.    Change in Control.
14.1    Except as specifically agreed to the contrary in a written agreement with a Participant, in connection with any Change in Control, the Committee may, in its sole discretion, provide for any one or more of the following:
(a)    substitution or assumption of Awards, or to the extent the surviving entity (or Affiliate thereof) is unwilling to permit substitution or assumption of the Awards, full acceleration of the vesting of any time-vested Awards, and acceleration of any Performance Share Awards (based on actual performance through the date of such Change in Control and on a pro-rata basis); and/or
(b)    cancellation of any one or more outstanding Awards and payment to the holders of such Awards that are vested as of such cancellation (including, without limitation, any Awards that would vest as a result of the occurrence of such event but for such cancellation, including as provided in Section 14.1(a) above), the value of such Awards, if any, as determined by the Committee (which value, if applicable, may be based upon the price per share of Common Stock received or to be received by other stockholders of the Company in such event), including, without limitation, in the case of an outstanding Option or SAR, a cash payment in an amount equal to the excess, if any, of the Fair Market Value (as of a date specified by the Committee) of the shares of Common Stock subject to such Option or SAR over 

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the aggregate Option Price or Base Price of such Option or SAR (it being understood that, in such event, any Option or SAR having a per share Exercise Price or Base Price equal to, or in excess of, the Fair Market Value of a share of Common Stock subject thereto may be canceled and terminated without any payment or consideration therefor).
For purposes of Section 14.1(a) above, substitution of an Award may include conversion of the Shares underlying such Award into shares of the buyer (or Affiliate thereof), or, subject to any limitations or reductions as may be necessary to comply with Section 409A of the Code, into cash, property or other securities having an equivalent value as the Award (as determined consistent with Section 14.1(b) above), which conversion shall not affect any continued vesting requirements of the Award.  For the avoidance of doubt, any such substitution of an Award shall not provide for the acceleration of any vesting requirements of the Award except due to a termination of employment by the Company without cause, a Participant’s resignation for good reason, or employment termination due to death or disability, as reasonably determined by the Committee, within twelve months of a Change in Control, and no Awards shall vest solely as a result of such substitution.  Payments to holders pursuant to Section 14.1(b) above shall be made in cash or, in the sole discretion of the Committee, in the form of such other consideration necessary for a Participant to receive property, cash, or securities (or combination thereof) as such Participant would have been entitled to receive upon the occurrence of the transaction if the Participant had been, immediately prior to such transaction, the holder of the number of shares of Common Stock covered by the Award at such time (less any applicable Exercise Price or Base Price).
14.2    No Award Agreement shall provide for automatic acceleration of the vesting of any time-vested Awards or Performance Share Awards upon a Change in Control.
14.3    Prior to any payment or adjustment contemplated under this Section 14, the Committee may require a Participant to (i) represent and warrant as to the unencumbered title to the Participant’s Awards; and (ii) deliver customary transfer documentation as reasonably determined by the Committee.
15.    Withholding.
15.1    Tax Withholding.  The Company shall have the power and the right to deduct or withhold, or require a Participant to remit to the Company, the minimum statutory amount to satisfy federal, state, and local taxes, domestic or foreign, required by law or regulation to be withheld with respect to any taxable event arising as a result of this Plan prior to making any payments hereunder.  An Agreement may provide that (a) the Company shall withhold whole Shares which would otherwise be delivered to a holder, having an aggregate Fair Market Value determined as of the date the obligation to withhold or pay taxes arises in connection with an award (the “Tax Date”), or withhold an amount of cash which would otherwise be payable to a holder, in the amount necessary to satisfy any such obligation or (b) the holder may satisfy any such obligation by any of the following means: (i) a cash payment to the Company; (ii) delivery (either actual delivery or by attestation procedures established by the Company) to the Company of previously owned whole Shares having an aggregate Fair Market Value, determined as of the Tax Date, equal to the amount necessary to satisfy any such obligation; (iii) authorizing the Company to withhold whole Shares which would otherwise be delivered having an aggregate Fair Market Value, determined as of the Tax Date, or withhold an amount of cash which would otherwise be payable to a holder, equal to the amount necessary to satisfy any such obligation; (iv) in the case of the exercise of an Option, a cash payment by a broker-dealer acceptable to the Company to whom the optionee has submitted an irrevocable notice of exercise or (v) any combination of (i), (ii), (iii) and (iv), in each case to the extent permitted by the Administrator.  Shares to be delivered or withheld may not have an aggregate Fair Market Value in excess of the amount determined by applying the minimum statutory withholding rate.  Any fraction of a Share which would be required to satisfy such an obligation shall be disregarded and the remaining amount due shall be paid in cash by the holder.
16.    Certain Terminations of Employment, Hardship and Approved Leaves of Absence.  Notwithstanding any other provision of the Plan to the contrary, in the event of a Participant’s termination of employment (including by reason of death, disability or retirement) or in the event of hardship or other special circumstances, the Administrator may in its sole discretion take any action that it deems to be equitable under the circumstances or in the 

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best interests of the Company, including, without limitation, waiving or modifying any limitation or requirement with respect to any Award under the Plan.  The Administrator shall have the discretion to determine whether and to what extent the vesting of Awards shall be tolled during any leave of absence, paid or unpaid; provided however, that in the event of military leave, vesting shall toll during any unpaid portion of such leave, provided that, upon a Participant’s returning from military leave (under conditions that would entitle him or her to protection upon such return under the Uniform Services Employment and Reemployment Rights Act), he or she shall be given vesting credit with respect to the Award to the same extent as would have applied had the Participant continued to provide services to the Company throughout the leave on the same terms as he or she was providing services immediately prior to such leave.  Any actions taken by the Administrator shall be taken consistent with the requirements of Section 409A of the Code.
17.    Authorization of Sub-Plans and Foreign Employees.  The Administrator may from time to time establish one or more sub-plans under the Plan for purposes of satisfying applicable blue sky, securities, and/or tax laws of various jurisdictions.  The Administrator shall establish such sub-plans by adopting supplements to the Plan containing (a) such limitations as the Administrator deems necessary or desirable, and (b) such additional terms and conditions not otherwise inconsistent with the Plan as the Administrator shall deem necessary or desirable.  All sub-plans adopted by the Administrator shall be deemed to be part of the Plan, but each sub-plan shall apply only to Participants within the affected jurisdiction and the Company shall not be required to provide copies of any sub-plans to Participants in any jurisdiction which is not the subject of such sub-plan.  Without amending the Plan, the Administrator may grant awards to eligible persons who are foreign nationals and/or reside outside the U.S. on such terms and conditions different from those specified in the Plan as may in the judgment of the Administrator be necessary or desirable to foster and promote achievement of the purposes of this Plan.
18.    Amendments and Other Matters.
18.1    Plan Amendments.  The Board may amend, suspend or terminate the Plan or Administrator’s authority to grant Awards under the Plan at any time.  Notwithstanding the foregoing, no amendments shall be effective without approval of the Company’s stockholders if (a) stockholder approval of the amendment is then required pursuant to the Code, the rules of the primary stock exchange or stock market on which the Shares are then traded, applicable U.S. state corporate laws or regulations, applicable U.S. federal laws or regulations, and the applicable laws of any foreign country or jurisdiction where Awards are, or shall be, granted under the Plan, or (b) such amendment would (i) modify Section 18.4, (ii) increase the aggregate number of Shares issued or issuable under the Plan, (iii) increase any limitation set forth on the number of Shares which may be issued or the aggregate value of Awards or the per-person limits under Section 3 except as provided in Section 13, (iv) modify the eligibility requirements for Participants in the Plan, or (v) reduce the minimum Option Price and Base Price as set forth in Sections 5 and 6, respectively.  Notwithstanding any other provision of the Plan to the contrary, except as provided in Section 18.8, no termination, suspension or amendment of the Plan may materially and adversely affect any outstanding Award without the consent of the affected Participant.
18.2    Award Deferrals.  The Administrator may permit Participants to elect to defer issuance of Shares or the settlement of Awards in cash under the Plan pursuant to such rules, procedures or programs as it may establish for purposes of the Plan.  However, any Award deferrals which the Administrator permits must comply with the provisions of Section 22 and the requirements of Section 409A of the Code.
18.3    Conditional Awards.  The Administrator may condition the grant of any award combination of Awards under the Plan on the surrender or deferral by the Participant of his or her right to receive a cash bonus or other compensation otherwise payable by the Company or any Subsidiary to the Participant, provided that any such grant must comply with the provisions of Section 22 and the requirements of Section 409A of the Code.
18.4    Repricing Prohibited.  The terms of outstanding Awards may not be amended to reduce the Option Price of outstanding Options or Base Price of outstanding Stock Appreciation Rights or cancel outstanding Options or Stock Appreciation Rights in exchange for cash, other Awards or Options or Stock Appreciation Rights with an Option Price or Base Price that is less than the Option Price or Base Price of the original Options or Stock Appreciation Rights without stockholder approval, provided that nothing herein shall prevent the Administrator from taking any action provided for in Section 13 above.

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18.5    No Employment Rights.  Nothing in the Plan or an Award Agreement shall interfere with or limit in any way the right of the Company or its Subsidiaries to terminate any Participant’s employment or service on the Board or to the Company at any time or for any reason not prohibited by law, nor confer upon any Participant any right to continue his employment or service as a director for any specified period of time.  Neither an Award nor any benefits arising under the Plan shall constitute an employment contract with the Company or its Subsidiaries and, accordingly, subject to Section 18.1, the Plan and the benefits hereunder may be terminated at any time in the sole and exclusive discretion of the Administrator without giving rise to any liability on the part of the Company or its Subsidiaries.
18.6    Tax Qualification.  To the extent that any provision of the Plan would prevent any Option that was intended to qualify under particular provisions of the Code from so qualifying, such provision of the Plan shall be null and void with respect to such Option, provided that such provision shall remain in effect with respect to other Options, and there shall be no further effect on any provision of the Plan.
18.7    Leave of Absence or Transfer.  A transfer between the Company and any Subsidiary or between Subsidiaries or a leave of absence duly authorized by the Company shall not be deemed to be a termination of employment.  Periods of time while on a duly authorized leave of absence shall be disregarded for purposes of determining whether a Participant has satisfied a Restricted Period or Performance Cycle under an Award.
18.8    Amendments to Comply with Laws, Regulations or Rules.  Notwithstanding any other provision of the Plan or any Award Agreement to the contrary, in its sole and absolute discretion and without the consent of any Participant, the Board may amend the Plan, and the Administrator may amend any Award Agreement, to take effect retroactively or otherwise as it deems necessary or advisable for the purpose of conforming the Plan or such Award Agreement to any present or future law, regulation or rule applicable to the Plan, including, but not limited to, Section 409A of the Code.
18.9    Tolling.  In the event a Participant is prevented from exercising an Option or the Company is unable to settle an Award due to any trading restrictions applicable to the Company’s Shares, then, unless otherwise determined by the Administrator, the length of time applicable to any such restriction shall toll any exercise period until such restriction lapses.
18.10    No Duty to Inform Regarding Exercise Rights.  Neither the Company, any Subsidiary, the Administrator nor the Board shall have any duty to inform a Participant of the pending expiration of the period in which a Stock Appreciation Right may be exercised or in which an Option may be exercised.
19.    Issuance of Shares; Fractional Shares.
19.1    Form for Issuing Shares; Legends.  Shares may be issued on a certificated or uncertificated basis.  Shares may include any legend which the Administrator deems appropriate to reflect any restrictions on transfer of such Shares.
19.2    Delivery of Title.  The Company shall have no obligation to issue or deliver evidence of title for Shares issued under the Plan prior to: (i) obtaining any approvals from governmental agencies that the Company determines are necessary or advisable; and (ii) completing any registration or other qualification of the Shares under any applicable national or foreign law or ruling of any governmental body that the Company determines to be necessary or advisable.
19.3    Inability to Obtain Authority.  The inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed by the Company’s counsel to be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of any liability in respect of the failure to issue or sell such Shares as to which such requisite authority shall not have been obtained.
19.4    Investment Representations.  The Administrator may require any individual receiving Shares pursuant to an Award under the Plan to represent and warrant in writing that the individual is acquiring the Shares for investment and without any present intention to sell or distribute such Shares,

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19.5    Fractional Shares.  The Company shall not be required to issue any fractional Shares pursuant to the Plan.  The Administrator may provide for the elimination of fractions or for the settlement thereof in cash.
20.    Limitations Period.  Any person who believes he or she is being denied any benefit or right under the Plan may file a written claim with the Administrator.  Any claim must be delivered to the Administrator within forty-five (45) days of the specific event giving rise to the claim.  Untimely claims will not be processed and shall be deemed denied.  The Administrator, or its designated agent, will notify the Participant of its decision in writing as soon as administratively practicable.  Claims not responded to by the Administrator in writing within ninety (90) days of the date the written claim is delivered to the Administrator shall be deemed denied.  The Administrator’s decision shall be final, conclusive and binding on all persons.  No lawsuit relating to the Plan may be filed before a written claim is filed with the Administrator and is denied or deemed denied, and any lawsuit must be filed within one year of such denial or deemed denial or be forever barred.  The venue for any lawsuit relating to the Plan or an Award shall be Chicago, Illinois.
21.    Governing Law.  This Plan, each award hereunder and the related Award Agreement, and all determinations made and actions taken pursuant thereto, to the extent not otherwise governed by the Code or applicable federal law, shall be governed by the laws of Delaware and construed in accordance therewith without giving effect to principles of conflicts of laws.
22.    Compliance with Section 409A.
22.1    In General.  The Plan is intended to be administered in a manner consistent with the requirements, where applicable, of Section 409A.  For avoidance of doubt, Stock Options and Stock Appreciation Rights are intended to qualify for the stock rights exemptions from Section 409A.  Where reasonably possible and practicable, the Plan shall be administered in a manner to avoid the imposition on Participants of immediate tax recognition and additional taxes pursuant to such Section 409A.  Notwithstanding the foregoing, neither the Company nor the Administrator shall have any liability to any person in the event Section 409A applies to any such Award in a manner that results in adverse tax consequences for the Participant or any of his or her transferees.
22.2    Elective Deferrals.  No elective deferrals or re-deferrals other than in regard to Restricted Stock Units are permitted under the Plan, except to the extent authorized under any sub-plan established under the Plan.
22.3    Applicable Requirements.  To the extent any of the Awards granted under the Plan are deemed “deferred compensation” and hence subject to Section 409A, the following rules shall apply to such Awards:
(a)    Mandatory Deferrals.  If the Company decides that the payment of compensation under the Plan shall be deferred within the meaning of Section 409A, then, except as provided under Treas. Reg. Section 1.409A-1(b)(4)(ii), on granting of the Award to which such compensation payment relates, the Company shall specify the date(s) at which such compensation will be paid in the Award Agreement.
(b)    Initial Deferral Elections.  For Awards of RSUs where the Administrator provides the opportunity to elect the timing and form of the payment of the underlying Shares at some future time once any requirements have been satisfied, the Participant must make his or her initial deferral election for such Award in accordance with the requirements of Section 409A, i.e., within thirty (30) days of first becoming eligible to receive such award or prior to the start of the year in which the Award is granted to the Participant, in each case pursuant to the requirements of Section 409A and Treas. Reg. Section 1.409A-2.
(c)    Subsequent Deferral Elections.  To the extent the Company or Administrator decides to permit compensation subject to Section 409A to be re-deferred pursuant to Treas. Reg. Section 1.409A-2(b), then the following conditions must be met: (i) such election will not take effect until at least 12 months after the date on which it is made; (ii) in the case of an election not related to a payment on account of disability, death or an unforeseeable emergency, the payment with respect to which such election is made must be deferred for a period of not less than five years from the date such payment would otherwise have been paid; and (iii) any election related to a payment at a specified time 

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or pursuant to a fixed schedule (within the meaning of Treas. Reg. Section 1.409A-3 (a)(4)) must be made not less than 12 months before the date the payment is scheduled to be paid.
(d)    Timing of Payments.  Payment(s) of compensation that is subject to Section 409A shall only be made upon an event or at a time set forth in Treas. Reg. Section 1.409A-3, i.e., the Participant’s separation from service, the Participant’s becoming disabled, the Participant’s death, at a time or a fixed schedule specified in the Plan or an Award Agreement, a change in the ownership or effective control of the Company, or in the ownership of a substantial portion of the assets of the Company, or the occurrence of an unforeseeable emergency.
(e)    Certain Delayed Payments.  Notwithstanding the foregoing, to the extent an amount was intended to be paid such that it would have qualified as a short-term deferral under Section 409A and the applicable regulations, then such payment is or could be delayed if the requirements of Treas. Reg. 1.409A-1(b)(4)(ii) are met.
(f)    Acceleration of Payment.  Any payment made under the Plan to which Section 409A applies may not be accelerated, except in accordance with Treas. Reg. 1.409A-3(j)(4), i.e., upon a Participant’s separation from service, the Participant becoming disabled, the Participant’s death, a change of ownership or effective control, or in the ownership of a substantial portion of the assets, or upon an unforeseeable emergency (all as detailed in Treas. Reg. Section 1.409A-3(a)).
(g)    Payments upon a Change in Control.  Notwithstanding any provision of the Plan to the contrary, to the extent an Award subject to Section 409A shall be deemed to be vested or restrictions lapse, expire or terminate upon the occurrence of a Change in Control and such Change in Control does not constitute a “change in the ownership or effective control” or a “change in the ownership of a substantial portion of the assets” of the Company within the meaning of Section 409A(a)(2)(A)(v), then even though such Award may be deemed to be vested or restrictions lapse, expire or terminate upon the occurrence of the Change in Control or any other provision of the Plan, payment will be made, to the extent necessary to comply with the provisions of Section 409A, to the Participant on the earliest of (i) the Participant’s “separation from service” with the Company (determined in accordance with Section 409A), (ii) the date payment otherwise would have been made pursuant to the regular payment terms of the Award in the absence of any provisions in the Plan to the contrary (provided such date is permissible under Section 409A) or (iii) the Participant’s death.
(h)    Payments to Specified Employees.  Payments due to a Participant who is a “specified employee” within the meaning of Section 409A on account of the Participant’s “separation from service” with the Company (determined in accordance with Section 409A) shall be made on the date that is six months after the date of the Participant’s separation from service or, if earlier, the Participant’s date of death.
22.4    Deferrals to Preserve Deductibility under Section 162(m).  The Administrator may postpone the exercising of Awards, the issuance or delivery of Shares under any Award or any action permitted under the Plan to prevent the Company or any Subsidiary from being denied a Federal income tax deduction with respect to any Award other than an ISO as a result of Section 162(m) in accordance with IRS regulations.  In such case, payment of such deferred amounts must be made as soon as reasonably practicable following the first date on which the Company, Subsidiary or both anticipates or reasonably should anticipate that, if the payment were made on such date, the Company’s and/or Subsidiary’s deduction with respect to such payment would no longer be restricted due to the application of Section 162(m).
22.5    Determining “Controlled Group”.  In order to determine for purposes of Section 409A whether a Participant or eligible individual is employed by a member of the Company’s controlled group of corporations under Section 414(b) of the Code (or by a member of a group of trades or businesses under common control with the Company under Section 414(c) of the Code) and, therefore, whether the Shares that are or have been purchased by or awarded under the Plan to the Participant are shares of “service recipient” stock within the meaning of Section 409A, a Participant or eligible employee of a Subsidiary shall be considered employed by the Company’s controlled group (or by a member of a group of trades or businesses under common control with the Company, as applicable).  Notwithstanding the above, to the extent that the Company finds that legitimate business criteria exist within the meaning of Treas. Reg. Section 

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1.409A-1(b)(5)(iii)(E)(1), then, solely for purposes of this Section 22.5, “at least 50 percent” in the definition of “Subsidiary” shall instead be “at least 20 percent”.
23.    Transferability.
23.1    Transfer Restrictions.  Except as provided in Sections 23.2 and 23.4, no Award granted under the Plan shall be transferable by a Participant other than upon death by will or the laws of descent and distribution, and Options and Stock Appreciation Rights shall be exercisable during a Participant’s lifetime only by the Participant or, in the event of the Participant’s legal incapacity, by his guardian or legal representative acting in a fiduciary capacity on behalf of the Participant under state law.  Any attempt to transfer an Award in violation of the Plan shall render such Award null and void.
23.2    Limited Transfer Rights.  The Administrator may expressly provide in an Award Agreement that a Participant may transfer such Award (other than an Incentive Stock Option), in whole or in part, to a Family Member, a trust for the exclusive benefit of Family Members, a partnership or other entity in which all the beneficial owners are Family Members, or any other entity affiliated with the Participant that may be approved by the Administrator.  Subsequent transfers of Awards shall be prohibited except in accordance with this Section 23.2.  All terms and conditions of the Award, including provisions relating to the termination of the Participant’s employment or service with the Company or a Subsidiary, shall continue to apply following a transfer made in accordance with this Section 23.2.
23.3    Additional Restrictions on Transfer.  Any Award made under the Plan may provide that all or any part of the Shares that are to be issued or transferred by the Company upon exercise, vesting or settlement shall be subject to further restrictions upon transfer.
23.4    Domestic Relations Orders.  Notwithstanding the foregoing provisions of this Section 23, any Award made under the Plan may be transferred as necessary to fulfill any domestic relations order as defined in Section 414(p)(1)(B) of the Code.
24.    Forfeiture and Clawback.  Without limiting in any way the generality of the Administrator’s power to specify any terms and conditions of an Award consistent with law, and for greater clarity, the Administrator may specify in an Award Agreement that the Participant’s rights, payments and benefits with respect to an Award, including any payment of Shares received upon exercise or in satisfaction of an Award under the Plan shall be subject to reduction, cancellation, forfeiture or clawback upon the occurrence of certain specified events, in addition to any otherwise applicable vesting or performance conditions, without limit as to time.  Such events shall include, but not be limited to, failure to accept the terms of the Award Agreement, termination of service under certain or all circumstances, violation of material Company policies, misstatement of financial or other material information about the Company, fraud, misconduct, breach of noncompetition, confidentiality, nonsolicitation, noninterference, corporate property protection, or other agreements that may apply to the Participant, or other conduct by the Participant that the Administrator determines is detrimental to the business or reputation of the Company and its Subsidiaries, including facts and circumstances discovered after termination of service.  Awards granted under the Plan shall be subject to any compensation recovery policy or minimum stock holding period requirement as may be adopted or amended by the Company from time to time.
25.    No Constraint on Corporate Action.  Nothing in the Plan shall be construed to: (i) limit, impair, or otherwise affect the Company’s or Subsidiary’s right or power to make adjustments, reclassifications, reorganizations, or changes of its capital or business structure, or to merge or consolidate, or dissolve, liquidate, sell, or transfer all or any part of its business or assets; or, (ii) limit the right or power of the Company or a Subsidiary to take any action which such entity deems to be necessary or appropriate.
26.    Effect of Disposition of Facility or Operating Unit.  If the Company or any of its Subsidiaries closes or disposes of the facility at which a Participant is located or the Company or any of its Subsidiaries diminish or eliminate ownership interests in any operating unit of the Company or any of its Subsidiaries so that such operating unit ceases to be majority owned by the Company or any of its Subsidiaries then, with respect to Awards held by Participants who subsequent to such event will not be Employees, the Administrator may, to the extent consistent with Section 409A (if 

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applicable), take any of the actions described in Section 14.1 with respect to a Change in Control.  If the Administrator takes no special action with respect to any disposition of a facility or an operating unit, then the Participant shall be deemed to have terminated his or her employment with the Company and its Subsidiaries and the terms and conditions of the Award Agreement and the other terms and conditions of the Plan shall control.
27.    Indemnification.  Subject to requirements of applicable state law, each individual who is or shall have been a member of the Board, or a committee appointed by the Board, or an officer of the Company to whom authority was delegated in accordance with Section 3, shall be indemnified and held harmless by the Company against and from any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by him in connection with or resulting from any claim, action, suit, or proceeding to which he may be a party or in which he or she may be involved by reason of any action taken or failure to act under the Plan and against and from any and all amounts paid by him in settlement thereof, with the Company’s approval, or paid by him in satisfaction of any judgment in any such action, suit, or proceeding against him, provided he shall give the Company an opportunity, at its own expense, to handle and defend the same before he undertakes to handle and defend it on his own behalf, unless such loss, cost, liability, or expense is a result of his own willful misconduct or except as expressly provided by statute.  The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such individuals may be entitled under the Company’s Certificate of Incorporation or by-laws, as a matter of law, or otherwise, or any power that the Company may have to indemnify them or hold them harmless.
28.    Restrictions on Shares.  Each Award made hereunder shall be subject to the requirement that if at any time the Company determines that the listing, registration or qualification of the Shares subject to such Award upon any securities exchange or under any law, or the consent or approval of any governmental body, or the taking of any other action is necessary or desirable as a condition of, or in connection with, the delivery of Shares thereunder, such Shares shall not be delivered unless such listing, registration, qualification, consent, approval or other action shall have been effected or obtained, free of any conditions not acceptable to the Company. The Company may require that certificates evidencing Shares delivered pursuant to any Award made hereunder bear a legend indicating that the sale, transfer or other disposition thereof by the holder is prohibited except in compliance with the Securities Act of 1933, as amended, and the rules and regulations thereunder, or other applicable securities laws.
29.    Nonexclusivity of the Plan.  The adoption of the Plan shall not be construed as creating any limitations on the power of the Board or Administrator to adopt such other compensation arrangements as it may deem desirable for any Participant.
30.    Miscellaneous.
30.1    Gender and Number.  Except where otherwise indicated by the context, any masculine term used herein also shall include the feminine, the plural shall include the singular, and the singular shall include the plural.
30.2    Severability.  In the event any provision of the Plan shall be held illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining parts of the Plan, and this Plan shall be construed and enforced as if the illegal or invalid provision had not been included.
30.3    Requirements of Law.  The granting of Awards and the issuance of Shares under this Plan shall be subject to all applicable laws, rules, and regulations, and to such approvals by any governmental agencies or national securities exchanges as may be required.
30.4    Successors.  All obligations of the Company under the Plan with respect to Awards granted hereunder shall be binding on any successor to the Company, whether the existence of such successor is the result of a direct or indirect purchase, merger, consolidation, or otherwise, of all or substantially all of the business and/or assets of the Company.
30.5    Designation of Beneficiary.  The Administrator may permit the holder of an Award to file with the Company a written designation of one or more persons as such holder’s beneficiary or beneficiaries (both primary and contingent) in the event of the holder’s death or incapacity.  To the extent an outstanding Option granted hereunder is 

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exercisable, such beneficiary or beneficiaries shall be entitled to exercise such Option pursuant to procedures prescribed by the Company.  Each beneficiary designation shall become effective only when filed in writing with the Company during the holder’s lifetime on a form prescribed by the Company.  The spouse of a married holder domiciled in a community property jurisdiction shall join in any designation of a beneficiary other than such spouse.  The filing with the Company of a new beneficiary designation shall cancel all previously filed beneficiary designations.  If a holder fails to designate a beneficiary, or if all designated beneficiaries of a holder predecease the holder, then each outstanding Award held by such holder, to the extent vested or exercisable, shall be payable to or may be exercised by such holder’s executor, administrator, legal representative or similar person.
30.6    Rights as a Shareholder.  Except as otherwise provided herein, a Participant shall have none of the rights of a shareholder with respect to Shares covered by any Award until the Participant becomes the record holder of such Shares.
30.7    Status of Plan.  With respect to the portion of any Award that has not been exercised and any payments in cash, Shares or other consideration not received by a Participant, the Participant shall have no rights greater than those of a general creditor of the Company.  In its sole discretion, the Administrator may authorize the creation of trusts or other arrangements to meet the Company’s obligations to deliver the Shares or make payments with respect to Awards hereunder, provided that the existence of such trusts or other arrangements is consistent with the foregoing sentence.
30.8    Trading Policy Restrictions.  Option exercises and other Awards under the Plan shall be subject to the Company’s insider trading policy and procedures, as in effect from time to time.

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IN WITNESS WHEREOF, the Company has caused the Plan to be executed in its name and behalf this 21st day of September 2020, by its duly authorized officer, effective as of the Effective Date.
KINGSWAY FINANCIAL SERVICES INC.

By:    /s/ John T Fitzgerald                 
    John T. Fitzgerald, President and CEO

 

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