Document:

amba-ex41_146.htm

Exhibit 4.1 

 

DESCRIPTION OF SHARE CAPITAL

 

General

 

The following is a summary of certain important terms of the share capital of Ambarella, Inc. (the “company,” “we,” “us” and “our”). Because it is only a summary, it does not contain all the information that may be important to you. For a complete description you should refer to our amended and restated memorandum and articles of association and the applicable provisions of the Companies Law (2020 Revision) of the Cayman Islands (the “Companies Law”) and the common law of the Cayman Islands.

 

Our authorized share capital consists of 200,000,000 ordinary shares, $0.00045 par value per share, and 20,000,000 preference shares, $0.00045 par value per share.

 

Ordinary Shares

 

Voting Rights

 

Each holder of our ordinary shares is entitled to one vote for each ordinary share held on all matters submitted to a vote of the shareholders, including the election of directors. Our amended and restated memorandum and articles of association do not provide for cumulative voting rights, including in respect of the election of directors. Accordingly, holders of a majority of the ordinary shares eligible to vote in any election of directors can elect all of the directors standing for election, if they should so choose.

 

Dividend Rights

 

Subject to preferences that may be applicable to any then outstanding preference shares, holders of our ordinary shares are entitled to receive dividends, if any, as may be declared from time to time by our board of directors out of legally available funds.

 

Variation of Rights of Shares

 

All or any of the special rights attached to any class of our shares may, unless otherwise provided by the terms of issue of the shares of that class, from time to time be varied with the sanction of an ordinary resolution passed at a separate general meeting of the holders of the shares of that class.

 

Liquidation

 

In the event of our liquidation, dissolution or winding up, holders of our ordinary shares will be entitled to share ratably in the net assets legally available for distribution to shareholders after the payment of all of our debts and other liabilities and the satisfaction of any liquidation preference granted to the holders of any then outstanding shares of preference shares.

 

Other Rights and Preferences

 

Holders of our ordinary shares have no preemptive, conversion, subscription or other rights, and there are no redemption or sinking fund provisions applicable to our ordinary shares. The rights, preferences and privileges of the holders of our ordinary shares are subject to and may be adversely affected by, the rights of the holders of any series of our preference shares that we may designate and issue in the future.

 

Preference Shares

 

Under our amended and restated memorandum and articles of association, our board of directors has the authority, without further action by the shareholders, to issue up to 20,000,000 preference shares in one or more series, to establish from time to time the number of shares to be included in each such series, to fix the rights, preferences and privileges of the shares of each wholly unissued series and any qualifications, limitations or restrictions thereon, and to increase or decrease the number of shares of any such series, but not below the number of shares of such series then outstanding.

 

Our board of directors may authorize the issuance of preference shares with voting or conversion rights that could adversely affect the voting power or other rights of the holders of the ordinary shares. The issuance of preference shares, while providing flexibility in connection with possible acquisitions and other corporate purposes, could, among other things, have the effect of delaying, deferring or preventing a change in our control and may adversely affect the market price of the ordinary shares and the voting and other rights of the holders of ordinary shares. 

 

Anti-Takeover Effects of Cayman Islands Law and Our Amended and Restated Memorandum and Articles of Association

 

Provisions of our memorandum and articles of association and Cayman Islands law may have the effect of delaying or preventing a change of control or changes in our management. These provisions include the following:

 

	
 
	
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the division of our board of directors into three classes;

	
 
	
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the right of our board of directors to elect a director to fill a vacancy created by the expansion of our board of directors or due to the resignation or departure of an existing board member;

	
 
	
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prohibition of cumulative voting in the election of directors which would otherwise allow less than a majority of shareholders to elect director candidates;

	
 
	
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the requirement for the advance notice of nominations for election to our board of directors or for proposing matters that can be acted upon at a general meeting;

	
 
	
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the ability of our board of directors to issue, without shareholder approval, such amounts of preference shares as the board of directors deems necessary and appropriate with terms set by our board of directors, which rights could be senior to those of our ordinary shares;

	
 
	
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the elimination of the rights of shareholders to call an extraordinary general meeting and to take action by written consent in lieu of a meeting; and

	
 
	
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the required approval of a special resolution of the shareholders, being a two-thirds vote of shares held by shareholders present and voting at a general meeting, to alter or amend the provisions of our memorandum and articles of association.

 

Differences in Corporate Law

 

The Companies Law is modeled after similar laws in the United Kingdom and differs from laws applicable to U.S. corporations and their shareholders. Set forth below is a summary of the significant differences between the provisions of the Companies Law applicable to us and the laws applicable to companies incorporated in the United States and their shareholders.

 

Mergers and Similar Arrangements

 

Mergers and Similar Arrangements. In certain circumstances the Companies Law allows for mergers or consolidations between two Cayman Islands companies, or between a Cayman Islands company and a company incorporated in another jurisdiction (provided that is facilitated by the laws of that other jurisdiction).

 

Where the merger or consolidation is between two Cayman Islands companies, the directors of each company must approve a written plan of merger or consolidation containing certain prescribed information. That plan of merger or consolidation must then be authorized by either (i) a special resolution of the shareholders of each company and (ii) such other authorization, if any, as may be specified in such constituent company’s articles of association. No shareholder resolution is required for a merger between a parent company (i.e., a company that owns issued shares that together represent at least 90% of the votes at a general meeting of a subsidiary company) and its subsidiary company, if a copy of the plan of merger is given to every member of the subsidiary company, unless the member agrees otherwise. The consent of each holder of a fixed or floating security interest of a constituent company must be obtained, unless the court waives such requirement. If the Cayman Islands Registrar of Companies is satisfied that the requirements of the Companies Law (which includes certain other formalities) have been complied with, the Registrar of Companies will register the plan of merger or consolidation.

 

Where the merger or consolidation involves an overseas company, the procedure is similar, except that with respect to the overseas company, the director of the Cayman Islands company is required to make a declaration to the effect that, having made due inquiry, such director is of the opinion that the requirements set out below have been met: (i) that the merger or consolidation is permitted or not prohibited by the constitutional documents of the overseas company and by the laws of the jurisdiction in which the overseas company is existing, and that those laws and any requirements of those constitutional documents have been or will be complied with; (ii) that no petition or other similar proceeding has been filed and remains outstanding or order made or resolution adopted to wind up or liquidate the overseas company in the jurisdiction in which the overseas company is existing; (iii) that no receiver, trustee, administrator or other similar person has been appointed in any jurisdiction and is acting in respect of the overseas company, its affairs or its property or any part thereof; (iv) that no scheme, order, compromise or other similar arrangement has been entered into or made in any jurisdiction whereby the rights of creditors of the overseas company are and continue to be suspended or restricted; and (v) that there are no other reasons why it would be against the public interest to allow the merger or consolidation.

 

Where the surviving company is the Cayman Islands company, the director of the Cayman Islands company is further required to make a declaration to the effect that, having made due inquiry, such director is of the opinion that the requirements set out below have been met: (i) that the overseas company is able to pay its debts as they fall due and that the merger or consolidated is bona fide and not intended to defraud unsecured creditors of the overseas company; (ii) that in respect of the transfer of any security interest granted by the overseas company to the surviving or consolidated company (a) consent or approval to the transfer has been obtained, released or waived, (b) the transfer is permitted by and has been approved in accordance with the constitutional documents of the overseas company, and (c) the laws of the jurisdiction of the overseas company with respect to the transfer have been or will be complied with; (iii) that the overseas company will, upon the merger or consolidation becoming effective, cease to be incorporated, registered or exist under the laws of the relevant foreign jurisdiction; and (iv) that there is no other reason why it would be against the public interest to permit the merger or consolidation.

 

Where the above procedures are adopted, the Companies Law provides for a right of dissenting shareholders to be paid a payment of the fair value of their shares upon their dissenting to the merger or consolidation if they follow a prescribed procedure. In essence, that procedure is as follows: (i) the shareholder must give written objection to the merger or consolidation to the constituent company before the vote on the merger or consolidation, including a statement that the shareholder proposes to demand payment for their shares if the merger or consolidation is authorized by the vote; (ii) within 20 days following the date on which the merger or consolidation is approved by the shareholders, the constituent company must give written notice to each shareholder who made a written objection; (iii) a shareholder must within 20 days following receipt of such notice from the constituent company, give the constituent company a written notice of their intention to dissent including, among other details, a demand for payment of the fair value of their shares; (iv) within seven days following the date of the expiration of the period set out in clause (ii) above or seven days following the date on which the plan of merger or consolidation is filed, whichever is later, the constituent company, the surviving company or the consolidated company must make 

a written offer to each dissenting shareholder to purchase their shares at a price that the company determines is the fair value and if the company and the shareholder agree the price within 30 days following the date on which the offer was made, the company must pay the shareholder such amount; and (v) if the company and the shareholder fail to agree a price within such 30-day period, within 20 days following the date on which such 30-day period expires, the company (and any dissenting shareholder) must file a petition with the Cayman Islands Grand Court to determine the fair value and such petition must be accompanied by a list of the names and addresses of the dissenting shareholders with whom agreements as to the fair value of their shares have not been reached by the company. At the hearing of that petition, the court has the power to determine the fair value of the shares together with a fair rate of interest, if any, to be paid by the company upon the amount determined to be the fair value. Any dissenting shareholder whose name appears on the list filed by the company may participate fully in all proceedings until the determination of fair value is reached. These rights of a dissenting shareholder are not be available in certain circumstances, for example, to dissenters holding shares of any class in respect of which an open market exists on a recognized stock exchange or recognized interdealer quotation system at the relevant date or where the consideration for such shares to be contributed are shares of any company listed on a national securities exchange or shares of the surviving or consolidated company.

 

Moreover, Cayman Islands law also has separate statutory provisions that facilitate the reconstruction or amalgamation of companies in certain circumstances. These provisions are commonly referred to in the Cayman Islands as “schemes of arrangement” and will generally be more suited for complex mergers or other transactions involving widely held companies, which may be tantamount to a merger. In the event that a merger was sought pursuant to a scheme of arrangement (the procedures of which are more rigorous and take longer to complete than the procedures typically required to consummate a merger in the United States), the arrangement in question must be approved by a majority in number of each class of shareholders and creditors with whom the arrangement is to be made and who must in addition represent three-fourths in value of each such class of shareholders or creditors, as the case may be, that are present and voting either in person or by proxy at a meeting, or meeting summoned for that purpose. The convening of the meetings and subsequently the terms of the arrangement must be sanctioned by the Grand Court of the Cayman Islands. While a dissenting shareholder would have the right to express to the court the view that the transaction should not be approved, the court can be expected to approve the arrangement if it satisfies itself that:

 

	
 
	
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we are not proposing to act illegally or beyond the scope of our corporate authority and the statutory provisions as to majority vote have been complied with;

	
 
	
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the shareholders have been fairly represented at the meeting in question;

	
 
	
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the arrangement is such as a businessperson would reasonably approve; and

	
 
	
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the arrangement is not one that would more properly be sanctioned under some other provision of the Companies Law or that would amount to a “fraud on the minority.”

  

If a scheme of arrangement or takeover offer (as described below) is approved, any dissenting shareholder would have no rights comparable to appraisal rights, which would otherwise ordinarily be available to dissenting shareholders of United States corporations, providing rights to receive payment in cash for the judicially determined value of the shares.

 

Squeeze-out Provisions. When a takeover offer is made and, within four months, accepted by holders of 90% of the shares to which the offer relates, the offeror may, within a two-month period, require the holders of the remaining shares to transfer such shares on the terms of the offer. An objection can be made to the Grand Court of the Cayman Islands but this is unlikely to succeed unless there is evidence of fraud, bad faith, collusion or inequitable treatment of the shareholders.

 

Further, transactions similar to a merger, reconstruction and/or an amalgamation may in some circumstances be achieved through other means to these statutory provisions, such as a share capital exchange, asset acquisition or control, through contractual arrangements, of an operating business.

 

Shareholders’ Suits

 

Shareholders’ Suits. Our Cayman Islands counsel is not aware of any reported class action having been brought in a Cayman Islands court. Derivative actions have been brought in the Cayman Islands courts, and the Cayman Islands courts have confirmed their availability. In principle, we will normally be the proper plaintiff and a claim against, for example, our officers or directors usually may not be brought by a shareholder. However, based on English authorities, which would in all likelihood be of persuasive authority and be applied by a court in the Cayman Islands, exceptions to the foregoing principle apply in circumstances in which:

 

	
 
	
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a company is acting or proposing to act illegally or beyond the scope of its authority;

	
 
	
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the act complained of, although not beyond the scope of the authority, could be effected if duly authorized by more than the number of votes which have actually been obtained; or

	
 
	
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those who control the company are perpetrating a “fraud on the minority.”

 

A shareholder may have a direct right of action against us where the individual rights of that shareholder have been infringed or are about to be infringed.

 

Indemnification. The Companies Law does not limit the extent to which a company’s memorandum and articles of association may provide for indemnification of officers and directors, except to the extent any such provision may be held by the Cayman Islands courts to be contrary to public policy, such as to provide indemnification against civil fraud or the consequences of committing a crime. Our amended and restated memorandum and articles of association provides for indemnification of officers and directors for losses, damages, costs and expenses incurred in their capacities as such, except through their own actual fraud or willful default.

  

Cayman Islands law does not restrict transactions with directors, requiring only that directors exercise a duty of care and owe a fiduciary duty to the companies for which they serve. Under our amended and restated memorandum and articles of association, subject to any separate requirement for audit committee approval under the applicable rules of Nasdaq or unless disqualified by the chairman of the relevant board meeting, so long as a director discloses the nature of such director’s interest in any contract or arrangement which such director is interested in, such a director may vote in respect of any contract or proposed contract or arrangement in which such director is interested and may be counted in the quorum at such meeting.

 

Transfer Agent and Register

 

The transfer agent and registrar for our ordinary shares is Computershare Trust Company, N.A.

 

Stock Exchange Listing

 

Our ordinary shares have been approved for listing on The Nasdaq Global Market under the symbol “AMBA.”Exhibit 10.1

 

Portions of Appendix A to this Exhibit
10.1 have been excluded from this Exhibit because they are both not material and would likely cause competitive harm to the registrant
if publicly disclosed. Such information will be disclosed as, if and when required pursuant to Item 402 of Regulation S-K. 

 

FIRST UNITED CORPORATION

 

LONG TERM INCENTIVE PLAN

FORM OF RESTRICTED STOCK UNIT (RSU) AGREEMENT

(Performance-Vesting)

(Share-Settled)

 

	Grant Date:	_____________ (the “Grant Date”)
	Name of Grantee:	____________ (the “Grantee” or “you”)
	Performance Period:	___________________ (the “Performance Period”)
	Target number of RSUs subject to Award:	_________________
	Maximum number of RSUs subject to Award:	_________________

 

This Restricted Stock Unit (RSU) Agreement
(“Agreement”) is made and entered into as of the Grant Date by and between First United Corporation,
a Maryland corporation (the “Company”), and you.

 

WHEREAS, the Company has adopted
the First United Corporation Long-Term Incentive Plan (as amended from time to time, the “LTIP”) as a
subplan of the First United Corporation 2018 Equity Compensation Plan (the “Equity Plan” and, together
with the LTIP, the “Plan”), under which the Company is authorized to grant equity-based awards to certain
employees and service providers of the Company;

 

WHEREAS, the Company, to induce you
to continue to dedicate service to the Company and to materially contribute to the success of the Company, agrees to grant you
this award of Restricted Stock Units (“RSUs”);

 

WHEREAS, you acknowledge that a copy
of the Plan has been furnished to you (and is also publicly filed) and shall be deemed a part of this Agreement as if fully set
forth herein and the terms capitalized but not defined herein shall have the meanings set forth in the Plan;

 

WHEREAS, you acknowledge that a copy
of a prospectus that summarizes the terms and conditions of the Plan has also been furnished to you in accordance with applicable
law; and

 

WHEREAS, you desire to accept the
award of RSUs granted pursuant to this

Agreement.

 

NOW, THEREFORE, in consideration
of the mutual covenants set forth herein and for other valuable consideration hereinafter set forth, the parties agree as follows:

 

     

     

    

 

1.       The
Grant. Subject to the conditions set forth below, the Company hereby grants you, effective as of the Grant Date, as a matter
of separate inducement and not in lieu of any salary or other compensation for your services for the Company, an award of RSUs
(the “Award”) consisting of the number of RSUs set forth above in accordance with the terms and conditions
set forth herein and in the Plan.

 

2.       Settlement
of RSUs. Subject to Section 9 and Section 30, as soon as reasonably practicable after the RSUs vest as provided
in Section 5 or Section 6 (but in no event later than March 15 following the end of the calendar year in which the
RSUs vest), the Company shall settle the vested RSUs in shares of Stock (“Shares”) by delivering one
Share for each such RSU, rounded down in the event of a fraction. The Company, in its sole discretion, may elect to deliver the
Shares in either certificate form or in electronic, book-entry form, with such legends or restrictions thereon as the Committee
may determine to be necessary or advisable in order to comply with applicable securities laws. You shall complete and sign any
documents and take any additional action that the Company may request to enable it to deliver Shares on your behalf.

 

3.       No
Stockholder Rights. Unless and until the RSUs are settled, you shall not have any rights of ownership in or with respect
to the RSUs, including voting rights, Dividend Equivalent rights, or similar shareholder rights.

 

4.       Restrictions;
Forfeiture. The RSUs may not be sold, transferred or otherwise alienated or hypothecated until they have been settled as described
in Section 2. The RSUs may also be forfeited to the Company as provided in Section 5 and Section 6.

 

5.       Vesting
Requirements. Subject to the terms and conditions of this Agreement and the Plan, the RSUs shall vest subject to the satisfaction
of both time-based vesting conditions and performance-based vesting conditions. None of the RSUs shall be considered earned
until all vesting conditions applicable to such RSUs are fully satisfied. You shall be deemed to satisfy the time-based vesting
conditions upon your continuous provision of service to the Company or an Affiliate as an employee or as an independent contractor
in any managerial or governance capacity, or as a member of the Board or a board of an Affiliate (“Service”),
from the Grant Date through the end of the Performance Period reflected in the table at the beginning of this Agreement. The performance-based
vesting conditions shall be satisfied upon the achievement of the performance objectives set forth in Appendix A. Notwithstanding
any provision of this Agreement to the contrary, a maximum of 150% of the target number of RSUs reflected in the table at the beginning
of this Agreement shall be eligible to become vested. Except as otherwise provided in Section 6, any RSUs that do not vest
at the end of the Performance Period shall be forfeited.

 

6.       Termination
of Services.

 

(a)       Termination
due to Death, Disability or Retirement. Notwithstanding Section 5, if your Service is terminated (i) due to your death,
(ii) because you suffer a “Disability” as that term is defined in the First United Bank & Trust Long Term Disability
Plan (as amended or superseded from time to time) as in effect at the time a determination of Disability is to be made, (iii) due
to your separation from Service for any reason other than death, Disability, Cause (as defined in Section 6(f)), or Detrimental
Activity (as defined in Section 6(g)) after you have both (A) completed 10 years of Service with the Company or an Affiliate
and (B) attained 60 years of age, then a pro rata portion, determined in accordance with the following sentence, of the target
number of RSUs reflected in the table at the beginning of this Agreement shall become vested and earned upon the date your Service
is terminated, based on the assumption that the performance-based vesting conditions have been achieved at “Target”,
as set forth in Appendix A. Such pro rata portion shall be determined based on a fraction, the numerator of which shall
be the number of days that you were providing Service during the Performance Period and the denominator of which shall be the total
number of days in the Performance Period. Any RSUs not vesting shall be forfeited.

 

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(b)       Change
in Control. Notwithstanding Section 5 and subject to the Committee’s authority set forth in Section 15 of the
Equity Plan, upon the occurrence of a Change in Control, (i) for any portion of the RSUs for which the Performance Period has ended
prior to the date of the Change in Control, such RSUs shall vest based on the level of achievement of the performance goals set
forth in Appendix A for the applicable Performance Period, and (ii) for any portion of the RSUs for which the Performance
Period has not ended prior to the date of the Change in Control, the Company shall deem the Performance Period to end immediately
prior to the Change in Control, and such RSUs shall vest upon the Change in Control at the greater of (A) assumed achievement of
the performance goals set forth in Appendix A at “Target” or (B) the actual level of achievement of the performance
goals set forth in Appendix A as of the Change in Control; and any RSUs not vesting shall be forfeited .

 

(d)       Employment
Agreement; Severance Plan. Notwithstanding anything in this Agreement, in the event of any conflict between this Section
6 and the provisions of (i) any written employment agreement between you and the Company or (ii) any Company severance plan
under which you are a participant with respect to the vesting, acceleration or termination of equity awards upon a termination
of your Service, the provisions most favorable to you under either this Agreement or under such employment agreement or severance
plan, as applicable, shall control.

 

(e)       Other
Terminations. If your Service is terminated under circumstances other than as described above in this Section 6, then
those RSUs that have not vested as of the date of termination shall be forfeited to the Company.

 

(f)       Definition
of Cause. As used in this Agreement, “Cause” means one of the following reasons for which your Service
is terminated by the Company or an Affiliate: (i) willful or grossly negligent misconduct on your part that is materially injurious
to the Company or an Affiliate; (ii) your embezzlement or misappropriation of funds or property of the Company or an Affiliate;
(iii) your conviction of a felony or the entrance of a plea of guilty or nolo contendere to a felony; (iv) your conviction of any
crime involving fraud, dishonesty, moral turpitude or breach of trust or the entrance of a plea of guilty or nolo contendere to
such a crime; (v) your failure or refusal to devote full business time and attention to the performance of your duties and responsibilities
if such breach has not been cured within 15 days after notice is given to you; or (vi) issuance of a final non-appealable order
or other direction by a federal or state regulatory agency prohibiting your employment or other service in the business of banking.

 

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(g)       Definition
of Detrimental Activity . As used in this Agreement, “Detrimental Activity” means any conduct
or act by you that is determined by the Committee to be injurious, detrimental or prejudicial to any significant interest of the
Company or an Affiliate, including, without limitation, any one or more of the following types of activity:

 

(i)       Conduct
resulting in an accounting restatement due to material noncompliance with any financial reporting requirement under the U.S. federal
securities laws.

 

(ii)       Engaging
in any activity, as an employee, principal, agent or consultant for another entity that competes with the Company or an Affiliate
in any actual, researched or prospective product, service, system or business activity for which you have had any direct responsibility
during the last two years of your Service, in any territory in which the Company or an Affiliate sells, provides or markets such
product, service or system, or engages in such business activity.

 

(iii)       Soliciting
any employee of the Company or an Affiliate to terminate his or her employment with the Company or an Affiliate.

 

(iv)       The
disclosure to anyone outside the Company or an Affiliate, or the use in other than the Company’s or an Affiliate’s
business, without prior written authorization from the Company, of any confidential, proprietary or trade secret information or
material relating to the business of the Company and its Affiliates acquired by you during your Service.

 

(v)       Your
failure or refusal to disclose promptly and to assign to the Company or an Affiliate upon request all right, title and interest
in any invention or idea, patentable or not, made or conceived by you during your Service, relating in any manner to the actual
or anticipated business, research or development work of the Company or an Affiliate.

 

(vi)       Activity
that results in termination of your Service for Cause.

 

7.       Leave
of Absence. With respect to the Award, the Company may, in its sole discretion, determine that if you are on leave of absence
for any reason you shall be considered to still be in the Service; provided that rights to the RSUs during a leave of absence
shall be limited to the extent to which those rights were earned or vested when the leave of absence began.

 

8.       Payment
of Taxes. In connection with any disposition of Shares or cash acquired pursuant to settlement of the Award, you (or any person
permitted to receive such disposition or payment in the event of your death) shall be responsible for satisfying withholding taxes
and other tax obligations relating to the Award or payment. Such tax obligations shall be satisfied through net withholding (which
is a reduction of the amount of Shares or cash, as determined by the Committee, otherwise issuable or deliverable pursuant to the
Award or payment) and the maximum number of Shares that may be so withheld shall be the number of Shares that have an aggregate
Fair Market Value on the date of withholding or surrender equal to the aggregate amount of such tax liabilities determined based
on the greatest withholding rates for federal, state, local and/or foreign tax purposes, including payroll taxes, that may be utilized
without creating adverse accounting treatment for the Company with respect to the Award or payment, as determined by the Committee.
You acknowledge that there may be adverse tax consequences upon the transfer, vesting or settlement of the Award, the disposition
of the underlying Shares or cash and that you have been advised, and hereby are advised, to consult a tax advisor prior to such
transfer, vesting, settlement, disposition or payment. You represent that you are in no manner relying on the Board, the Committee,
the Company or any of its Affiliates or any of their respective managers, directors, officers, employees or authorized representatives
(including attorneys, accountants, consultants, bankers, lenders, prospective lenders and financial representatives) for tax advice
or an assessment of such tax consequences.

 

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9.       Compliance
with Securities Law and Plan Limits. Notwithstanding any provision of this Agreement to the contrary, to the extent RSUs are
otherwise settleable in Shares but there are not sufficient Shares available for issuance under the Plan, the Committee may elect
to settle the RSUs in cash. Notwithstanding any provision of this Agreement to the contrary, the issuance of Shares shall be subject
to compliance with all applicable requirements of federal, state, or foreign laws with respect to such securities and with the
requirements of any stock exchange or market system upon which the Stock may then be listed. No Shares shall be issued hereunder
if such issuance would constitute a violation of any applicable federal, state, or foreign securities laws or other law or regulations
or the requirements of any stock exchange or market system upon which the Stock may then be listed. In addition, Shares shall not
be issued hereunder unless (a) a registration statement under the Securities Act (the “Act”) is at the
time of issuance in effect with respect to the Shares issued or (b) in the opinion of legal counsel to the Company, the Shares
issued may be issued in accordance with the terms of an applicable exemption from the registration requirements of the Act. The
inability of the Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the Company’s
legal counsel to be necessary to the lawful issuance and sale of any Shares subject to the Award shall relieve the Company of any
liability in respect of the failure to issue such Shares as to which such requisite authority has not been obtained; provided,
however, that in such event, the Company shall settle the vested portion of this Award through payment of cash having a Fair
Market Value equal to the number of Shares otherwise issuable. As a condition to any issuance hereunder, the Company may require
you to satisfy any qualifications that may be necessary or appropriate to evidence compliance with any applicable law or regulation
and to make any representation or warranty with respect to such compliance as may be requested by the Company. From time to time,
the Board and appropriate officers of the Company are authorized to take the actions necessary and appropriate to file required
documents with governmental authorities, stock exchanges, and other appropriate Persons to make Shares available for issuance.

 

10.       Right
of the Company and Affiliates to Terminate Employment or Services. Nothing in this Agreement confers upon you the right to
continue in the employ of or performing services for the Company or any of its Affiliates, or interfere in any way with the rights
of the Company or any of its Affiliates to terminate your employment or service relationship at any time. For purposes of this
Agreement, you shall be considered to be in Service as long as you remain in Service or in the service of a corporation or a parent
or subsidiary of such corporation assuming or substituting a new award for this Award.

 

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11.       Corporate
Acts. The existence of the RSUs shall not affect in any way the right or power of the Board or the shareholders of the Company
to make or authorize any adjustment, recapitalization, reorganization, or other change in the Company’s capital structure
or its business, any merger or consolidation of the Company, any issue of debt or equity securities, the dissolution or liquidation
of the Company or any sale, lease, exchange, or other disposition of all or any part of its assets or business, or any other corporate
act or proceeding.

 

12.       Furnish
Information. You agree to furnish to the Company all information requested by the Company to enable it to comply with any reporting
or other requirements imposed upon the Company by or under any applicable statute or regulation.

 

13.       Remedies.
The parties to this Agreement shall be entitled to recover from each other reasonable attorneys’ fees incurred in connection
with the successful enforcement of the terms and provisions of this Agreement whether by an action to enforce specific performance
or for damages for its breach or otherwise.

 

14.       No
Liability for Good Faith Determinations. The members of the Board and of the Committee shall not be liable for any act, omission
or determination taken or made in good faith with respect to this Agreement or the RSUs granted hereunder.

 

15.       Execution
of Receipts and Releases. Any payment of cash or any issuance or transfer of Shares or other property to you, or to your legal
representative, heir, legatee or distributee, in accordance with the provisions hereof, shall, to the extent thereof, be in full
satisfaction of all claims of such persons hereunder. The Company may require you or your legal representative, heir, legatee or
distributee, as a condition precedent to such payment or issuance, to execute a release and receipt therefor in such form as it
shall determine.

 

16.       No
Guarantee of Interests. The Committee, the Board and the Company do not guarantee the Shares from loss or depreciation.

 

17.       Notice.
All notices required or permitted under this Agreement must be in writing and personally delivered or sent by mail and shall be
deemed to be delivered on the date on which it is actually received by the person to whom it is properly addressed or if earlier
the date it is sent via certified United States mail.

 

18.       Waiver
of Notice. Any person entitled to notice hereunder may waive such notice in writing.

 

19.       Information
Confidential. As partial consideration for the granting of the Award hereunder, you hereby agree to keep confidential all information
and knowledge, except that which has been disclosed in any public filings required by law, that you have relating to the terms
and conditions of this Agreement; provided, however, that such information may be disclosed as required by law and may be
given in confidence to your spouse and tax and financial advisors. In the event any breach of this promise comes to the attention
of the Company, it shall take into consideration that breach in determining whether to recommend the grant of any future similar
award to you, as a factor weighing against the advisability of granting any such future award to you.

 

    	 	- 6 -	 

     

    

 

20.       Successors.
This Agreement shall be binding upon you, your legal representatives, heirs, legatees and distributees, and upon the Company, its
successors and assigns.

 

21.       Severability.
If any provision of this Agreement is held to be illegal or invalid for any reason, the illegality or invalidity shall not affect
the remaining provisions hereof, but such provision shall be fully severable and this Agreement shall be construed and enforced
as if the illegal or invalid provision had never been included herein.

 

22.       Headings.
The titles and headings of Sections are included for convenience of reference only and are not to be considered in construction
of the provisions hereof.

 

23.       Governing
Law. All questions arising with respect to the provisions of this Agreement shall be determined by application of the laws
of Maryland without giving any effect to any conflict of law provisions thereof, except to the extent Maryland state law is preempted
by federal law. The obligation of the Company to sell and deliver Shares hereunder is subject to applicable laws and to the approval
of any governmental authority required in connection with the authorization, issuance, sale, or delivery of such Shares.

 

24.       Amendment.
This Agreement may be amended by the Board or by the Committee at any time; provided that any amendment that would materially
and adversely affect your rights hereunder shall not be effective without your consent.

 

25.       Clawback.
To the extent required by applicable law or any applicable securities exchange listing standards, or as otherwise determined by
the Board (or a committee thereof), all Shares granted and cash awarded under this Agreement shall be subject to the provisions
of any applicable clawback policies or procedures adopted by the Company, which clawback policies or procedures may provide for
forfeiture and/or recoupment of such Shares and cash. Notwithstanding any provision of this Agreement to the contrary, the Company
reserves the right, without your consent, to adopt any such clawback policies and procedures, including such policies and procedures
applicable to this Agreement with retroactive effect.

 

26.       The
Plan. This Agreement is subject to all the terms, conditions, limitations and restrictions contained in the Plan.

 

27.       Counterparts.
This Agreement may be executed in one or more counterparts, each of which shall constitute an original and all of which together
shall constitute one instrument. Delivery of an executed counterpart of this Agreement by facsimile or portable document format
(.pdf) attachment to electronic mail shall be effective as delivery of a manually executed counterpart of this Agreement.

 

    	 	- 7 -	 

     

    

 

28.       Consent
to Electronic Delivery; Electronic Signature. In lieu of receiving documents in paper format, you agree, to the fullest extent
permitted by law, to accept electronic delivery of any documents that the Company may be required to deliver (including prospectuses,
prospectus supplements, grant or award notifications and agreements, account statements, annual and quarterly reports and all other
forms of communications) in connection with this and any other award made or offered by the Company. Electronic delivery may be
via a Company electronic mail system or by reference to a location on a Company intranet to which you have access. You hereby consent
to any and all procedures the Company has established or may establish for an electronic signature system for delivery and acceptance
of any such documents that the Company may be required to deliver, and agree that your electronic signature is the same as, and
shall have the same force and effect as, your manual signature.

 

29.       Entire
Agreement. This Agreement constitutes the entire agreement of the parties with regard to the subject matter hereof,
and contains all the covenants, promises, representations, warranties and agreements between the parties with respect to the Award
granted hereby; provided, however, that the terms of this Agreement shall not modify and shall be subject to the terms and
conditions of any employment, consulting and/or severance agreement or severance plan between the Company (or an Affiliate or other
entity) and you in effect as of the date a determination is to be made under this Agreement. Without limiting the scope of the
preceding sentence, except as provided therein, all prior understandings and agreements, if any, among the parties hereto relating
to the subject matter hereof are hereby null and void and of no further force and effect. In this Agreement, unless otherwise stated,
the following uses apply: (a) “including” (and like terms) means “including, without limitation” (and like
terms); and (b) references to sections and exhibits are to sections and exhibits in and to this Agreement.

 

30.       Acknowledgements
Regarding Section 409A of the Code. This Agreement is intended to comply with section 409A of the Code and the guidance and
regulations promulgated thereunder (“Section 409A”) or an exemption thereunder and shall be construed
and interpreted in a manner that is consistent with the requirements for avoiding additional taxes or penalties under Section 409A.
Notwithstanding the foregoing, the Company makes no representations that the payments and benefits provided under this Agreement
comply with Section 409A, and in no event shall the Company be liable for all or any portion of any taxes, penalties, interest
or other expenses that may be incurred by you on account of non-compliance with Section 409A. Notwithstanding the foregoing, you
acknowledge that if you are deemed a “specified employee” within the meaning of Section 409A, as determined by the
Committee, at a time when you become eligible for settlement of the RSUs upon “separation from service” within the
meaning of Section 409A, then to the extent this Agreement provides for “nonqualified deferred compensation” and to
the extent necessary to prevent any accelerated or additional tax under Section 409A, such settlement shall be delayed until the
earlier of: (a) the date that is six months following your separation from service and (b) your death. All installment payments
under this Agreement shall be deemed separate payments for purposes of Section 409A.

 

[Signatures Appear on Next Page]

 

    	 	- 8 -	 

     

    

 

[Signature Page]

 

IN WITNESS WHEREOF, the Company has
caused this Agreement to be executed by its officer thereunto duly authorized, and the Grantee has set his or her hand as of the
Grant Date.

 

 

	 	FIRST UNITED CORPORATION
	 	 
	 	By:	 
	 	Name: 
	 	Title:
	 	 
	 	 
	 	GRANTEE
	 	 
	 	 

 

 

 

 

    	 	- 9 -	 

     

    

 

 

Appendix A

 

Performance Objectives

 

[For RSUs granted for the performance period ending December
31, 2021]

 

Performance Period: January 1, 2019 to December 31, 2021

 

Earnings Per Share for the Year Ended December 31, 2021

 

Threshold Level: $[ ]

 

Target Level: $[ ]

 

Maximum Level: $[ ]

 

Payout

 

If the threshold level is met, then 50% of the Performance Award
will vest. If the target level is met, then 100% of the Performance Award will vest. If the maximum level is met, then 150% of
the Performance Award will vest. Actual vesting amounts will be pro-rated between threshold and target level and target and maximum
levels.

 

[For RSUs granted for the performance period ending December
31, 2022]

 

Performance Period: January 1, 2020 to December 31, 2022

 

Earnings Per Share for the year ended December 31, 2022

 

Threshold Level: $[ ]

 

Target Level: $[ ]

 

Maximum Level: $[ ]

 

Growth in Tangible Book Value Per Share for the 3-Year Period
Ended December 31, 2022

 

Threshold Level: [ ]%

 

Target Level: [ ]%

 

Maximum Level: [ ]%

 

Payout

 

If either of the threshold levels is met, then 50% of the Performance
Award will vest. If either of the target levels is met, then 100% of the Performance Award will vest. If either of the maximum
levels is met, then 150% of the Performance Award will vest. Actual vesting amounts will be pro-rated between threshold and target
level and target and maximum levels.

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