CHANGE IN
CONTROL AGREEMENT
THIS
CHANGE IN CONTROL AGREEMENT (“Agreement”) is entered
into as of the 15 TH
day of
April, 2008, by and among CITIZENS & NORTHERN
CORPORATION , a Pennsylvania corporation (the
“Corporation”), CITIZENS & NORTHERN BANK, a
Pennsylvania bank (the “Bank”), and GEORGE M.
RAUP , an employee of the Corporation and/or the Bank and/or of
a subsidiary of either (the “Employee”). The
Corporation and the Bank are collectively referred to herein as the
“Employer.”
WHEREAS,
the Employer wishes to assure itself of the continuity of the
Employee’s services in the event of any actual change in
control of the Corporation; and
WHEREAS,
the Employer and the Employee accordingly desire to enter into this
Agreement on the terms and conditions set forth below;
NOW,
THEREFORE, in consideration of the premises and mutual covenants
set forth herein, it is hereby agreed by and between the parties as
follows:
1.
Term of
Agreement . The “Term” of this Agreement
shall commence on the date hereof and shall continue through
December 31, 2008; provided, however , that on such
date and on each December 31 thereafter, the Term of this
Agreement shall automatically be extended for one additional year
unless, not later than the preceding January 1 either party shall
have given written notice to the other that such party does not
wish to extend the Term; and provided, however, that if a Change in
Control (as defined in Section 3 below) shall have occurred
during the original or any extended Term of this Agreement, the
Term of this Agreement shall continue for a period of twenty-four
(24) calendar months commencing with the calendar month in
which such Change in Control occurs and shall end upon the
expiration of such 24 month period.
2. Employment
After a Change in Control . If the Employee is in
the employ of the Bank on the date of a Change in Control, the Bank
hereby agrees to continue the Employee in its employ for the period
commencing on the date of the Change in Control and ending on the
last day of the Term of this Agreement (the “Employment
Period”). During the Employment Period, the Employee shall
hold such position with the Bank and exercise such authority and
perform such employment duties as are commensurate with the
Employee’s position, authority and duties immediately prior
to the Change in Control. The Employee agrees that during the
Employment Period the Employee shall devote full business time
exclusively to the Employee’s duties and perform such duties
faithfully and efficiently; provided, however , that nothing
in this Agreement shall prevent either (i) the Employee
from voluntarily resigning from employment upon at least sixty
(60) days’ written notice to the Bank under
circumstances which do not constitute a Termination (as defined
below in Section 5), or (ii) the Bank terminating
the Employee for “Cause” as defined in Section 5
hereof or for any other reason or no reason.
3.
Change in
Control . For purposes of this Agreement, a
“Change in Control” means the happening of any of the
following: the merger of the Corporation into, or the consolidation
of the Corporation with, another entity; the sale or other
disposition of all or substantially all of the Corporation’s
assets; or the liquidation of the Corporation; provided,
however , that a Change in Control shall not be deemed
to have occurred by reason of a transaction, or a substantially
concurrent or otherwise related series of transactions, upon the
completion of which 50 percent or more of the beneficial
ownership of the voting power of the Corporation (or of the
surviving corporation or corporation directly or indirectly
controlling the Corporation) is held by (i) employee benefit
plans of the Corporation ; or (ii) an “Affiliate”
of the Corporation (as defined in the Securities Exchange Act of
1934, as amended).
4.
Compensation During
the Employment Period . During the Employment Period,
the Employee shall be compensated as follows:
a. The
Employee shall receive compensation which is not less than
compensation paid by the Employer to the Employee immediately prior
to the Employment Period; and
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b. The
Employee shall be eligible to participate in the Employer employee
benefit plans which are not materially less favorable to the
Employee than the Employer employee benefit plans in which the
Employee participated in immediately prior to the Employment
Period.
5.
Termination . For
purposes of this Agreement, the term “Termination”
shall mean termination of the employment of the Employee during the
Employment Period either (i) by the Employer, for any
reason other than death, Disability (as defined below), or
Cause (as described below), or (ii) by resignation of
the Employee upon the occurrence of one or more of the following
events:
a. A
significant change in the nature or scope of the Employee’s
authorities or duties from those described in Section 2 above,
a breach of any of the provisions of Section 4 above, or the
breach by the Employer of any other provision of this
Agreement;
b. The
relocation of the Employee’s office to a location more than
35 miles from the location of the Employee’s office
immediately prior to the Employment Period;
c. A
reasonable determination by the Employee that, as a result of a
Change in Control and a change in circumstances thereafter
significantly affecting the nature and scope of Employee’s
authorities and duties from those described in Section 2
above, the Employee is unable to exercise the authorities, powers,
functions or duties associated with the Employee’s position
as contemplated by Section 2 above; or
d. The
failure of the Corporation to obtain a satisfactory agreement from
any successor to assume and agree to perform this Agreement as
contemplated in Section 15 below.
The
date of the Employee’s Termination under this Section 5
shall be the date specified by the Employee or the Employer,
as the case may be, in a written notice to the other party
complying with the requirements of Section 11 below. For
purposes of this Agreement, the Employee shall be considered to
have a “Disability” during the period in which the
Employee is unable, by reason of a medically determinable physical
or mental impairment, to engage in the material and substantial
duties of the
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