U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
X Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934 for
the Quarterly Period Ended June 30, 1996,
or
Transition Report Under Section 13 or
15(d) of the Exchange Act for the
Transition Period from _________________
to _________________.
Commission file number 0-14555
FIRST LEESPORT BANCORP, INC.
(Exact name of Small Business Issuer as specified in its charter)
PENNSYLVANIA
(State or other jurisdiction of
incorporation or organization)
23-2354007
(I.R.S. Employer
Identification No.)
133 North Centre Avenue
Leesport, Pennsylvania 19533
(Address of principal executive offices) (Zip Code)
(610) 926-2161
(Registrant's telephone number, including area code)
Check whether the Issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the Registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Yes [X] No [ ]
State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date.
Class Outstanding at August 1, 1996
Common Stock ($5.00 par value) 1,191,171 Shares
<PAGE>
<TABLE>
Part I - FINANCIAL INFORMATION
FIRST LEESPORT BANCORP, INC. AND SUBSIDIARY
UNAUDITED, CONSOLIDATED, CONDENSED BALANCE SHEETS
(Amounts in thousands)
<CAPTION>
Jun.30 Dec. 31
ASSETS 1996 1995
<S> <C> <C>
Cash and Due from Banks $ 4,845 $ 4,828
Interest-bearing Balances 26 215
_____ _____
Total Cash and Balances Due from Banks 4,871 5,043
Federal Funds Sold 0 601
Securities Available for Sale 37,164 37,849
Loans, Net of Unearned Income 111,641 105,271
Less: Allowance for Loan Losses (1,255) (1,179)
_______ _______
Net Loans 110,386 104,092
Bank Premises and Equipment 3,333 3,314
Other Real Estate Owned 12 69
Other Assets 3,396 1,434
_______ _______
Total Assets 159,162 152,402
LIABILITIES
Demand Deposits, Non-interest Bearing $ 16,235 $ 15,791
Demand Deposits, Interest Bearing 27,801 27,140
NOW, Money Market, and Savings Deposits 25,428 23,263
Time Deposits, $100,000 and over 2,562 4,607
Time Deposits 62,267 62,637
_______ _______
Total Deposits 134,293 133,438
Federal Funds Purchased 2,221 0
Other Borrowed Funds 5,000 0
Long-term Debt 0 1,000
Accrued Interest Payable 747 762
Other Liabilities 680 925
_______ _______
Total Liabilities 142,941 136,125
STOCKHOLDERS' EQUITY
Common Stock, $5.00 Par Value per Share; Authorized 2,000,000
Shares, Issued 1,200,000 Shares. $ 6,000 $ 6,000
Surplus 3,000 3,000
Retained Earnings 7,403 6,896
Net Unrealized Depreciation on Securities
Available for Sale, Net of Taxes (61) 502
Treasury Stock, 8,829 Shares at Cost (121) (121)
______ ______
Total Stockholders' Equity 16,221 16,277
_______ _______
Total Liabilities and Stockholders' Equity 159,162 152,402
<FN>
The accompanying notes are an integral part of these condensed financial
statements.
</TABLE>
<PAGE>
<TABLE>
FIRST LEESPORT BANCORP, INC. AND SUBSIDIARY
UNAUDITED, CONSOLIDATED, CONDENSED STATEMENTS OF INCOME
(Amounts in thousands, except per share data)
<CAPTION>
(in thousands) (in thousands)
Three Months Six Months
Ended Jun 30 Ended Jun 30
1996 1995 1996 1995
<S> <C> <C> <C> <C>
INTEREST INCOME
Interest & Fees on Loans $ 2,440 $ 2,250 $ 4,893 $ 4,443
Interest on Federal Funds Sold 3 38 12 45
Interest on Securities:
Taxable Securities 420 343 812 660
State and Municipal Bonds 160 162 325 328
_____ _____ _____ _____
TOTAL INTEREST INCOME 3,023 2,793 6,042 5,476
INTEREST EXPENSE
Interest on Deposits 1,276 1,236 2,597 2,268
Interest on Borrowed Funds 58 61 76 218
_____ _____ _____ _____
TOTAL INTEREST EXPENSE 1,334 1,297 2,673 2,486
_____ _____ _____ _____
NET INTEREST INCOME 1,689 1,496 3,369 2,990
Provision for Loan Losses 58 65 140 175
Net Interest Income after _____ _____ _____ _____
Provision for Loan Losses 1,631 1,431 3,229 2,815
OTHER INCOME
Customer Service Fees 67 68 144 133
Other Income 83 64 147 112
___ ___ ___ ___
TOTAL OTHER INCOME 150 132 291 245
OTHER EXPENSES
Salaries and Benefits 581 547 1,165 1,128
Occupancy Expense 97 101 200 192
Furniture and Equipment Expense 73 53 148 125
Computer Services 74 63 147 132
Federal Deposit Insurance Premiums 0 65 1 131
Other Operating Expenses 476 348 810 665
_____ _____ _____ _____
TOTAL OTHER EXPENSES 1,301 1,177 2,471 2,373
_____ _____ _____ _____
Income Before Income Taxes 480 386 1,049 687
Federal Income Taxes 117 82 259 137
_____ _____ _____ _____
NET INCOME 363 304 790 550
PER SHARE DATA
Based on Average Shares Outstanding 1,191,171 1,191,171 1,191,171 1,191,171
Net Income 0.30 0.26 .66 .46
Dividends 0.12 0.11 .24 .22
<FN>
The accompanying notes are an integral part of these condensed financial
statements.
</TABLE>
<PAGE>
<TABLE>
FIRST LEESPORT BANCORP, INC. AND SUBSIDIARY
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
Amounts in thousands, except per share data)
<CAPTION>
Six Months Ended
June 30,
1996 1995
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income $ 790 $ 550
Provision for loan losses 140 175
Provision for depreciation and amortization 147 121
Net amortization of security premiums and discounts (8) (38)
Loans originated for sale (1,197) (5,067)
Proceeds from sales of loans 1,175 5,083
(Gain) Loss on sales of loans 22 (16)
(Increase) Decrease in accrued interest receivable
and other assets (1,962) 170
Increase (Decrease) in accrued interest payable
and other liabilities (260) 1,304
_______ _____
NET CASH PROVIDED BY OPERATING ACTIVITIES (1,131) 2,266
CASH FLOWS FROM INVESTING ACTIVITIES
Held-to-maturity securities:
Proceeds from maturities of securities 0 1,500
Purchase of securities 0 (1,429)
Available-for-sale securities:
Proceeds from maturities of securities 4,705 611
Proceeds from sales of securities 0 484
Purchase of securities (4,677) (1,990)
Net (Increase) decrease in federal funds sold 601 (5,423)
Loans made to customers, net of principal collected (6,294) (3,146)
Purchases of bank premises and equipment (166) (22)
_______ _____
NET CASH (USED IN) INVESTING ACTIVITIES (5,831) (9,415)
CASH FLOWS FROM FINANCING ACTIVITIES
Net increase (decrease) in deposits 855 12,271
Net increase (decrease) in federal funds purchased 2,221 (5,493)
Net increase (decrease) in other borrowed funds 5,000 0
Repayment of long-term debt (1,000) 0
Dividends paid (286) (262)
_______ _____
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 6,790 6,516
_____ _____
Increase (decrease) in cash and cash equivalents (172) (633)
_____ _____
Cash and cash equivalents: Beginning 5,043 5,337
_____ _____
Ending 4,871 4,704
_____ _____
SUPPLEMENTAL DISCLOSURES OF CASH FLOWS:
Interest paid $ 2,688 $ 2,336
Income taxes paid 280 190
<FN>
The accompanying notes are an integral part of these condensed financial
statements.
</TABLE>
<PAGE>
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
1. The financial information included herein is unaudited, however, such
information reflects all adjustments (consisting solely of normal recurring
adjustments) which are, in the opinion of management, necessary for a fair
statement of the results for the interim periods.
2. The results of operations for the six-month period ended June 30, 1996
are not necessarily indicative of the results to be expected for the full
year.
<PAGE>
MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Financial Condition
The Company's total assets increased by $6,760,000 or 4.4% to $159,162,000 as
of June 30, 1996 from $152,402,000 at December 31, 1995. Loans and Other
Assets increased while all other asset categories decreased between the two
dates.
Cash and balances due from banks decreased from $5,043,000 at December 31,
1995 to $4,871,000 at June 30, 1996, a decrease of $172,000 or 3.4%. Within
this change, interest-bearing balances at the Federal Home Loan Bank of
Pittsburgh were decreased to $26,000 from $215,000, a decrease of $189,000.
The decrease in cash and due from banks allowed the Company to more profitably
deploy its liquid funds.
Federal funds sold decreased from $601,000 at December 31, 1995 to $0 at June
30, 1996 as all available excess funds were utilized.
Investment securities available for sale declined by $685,000 or 1.8% from
$37,849,000 at December 31, 1995 to $37,164,000 at June 30, 1996 as certain
securities matured during the first six months.
Net loans increased by $6,294,000 or 6.0% from $104,092,000 at December 31,
1995 to $110,386,000 at June 30, 1996. Mortgages, net of sales to FNMA, grew
by $6,856,000 while all other loan types decreased by a combined $562,000
between the two dates. Loans sold to FNMA during the first half of 1996
totaled $1,197,000.
Bank premises and equipment remained relatively stable; the net change between
December 31, 1995 and June 30, 1996 was an increase of $19,000, less than
1.0%.
Other assets, including other real estate owned increased by $1,905,000 or
126.7% from $1,503,000 at December 31, 1995 to $3,408,000 at June 30, 1996.
The majority of this increase, $1,785,000 came from the purchase of life
insurance policies by the Bank. These policies were used to fund a deferred
compensation plan for selected board members, and a supplemental retirement
program for the Bank's senior officers.
Total deposits increased by $855,000, or 0.6% from $133,438,000 at December
31, 1995 to $134,293,000 at June 30, 1996. Funding for the Bank's growth came
from the increased usage of available funding from the Federal Home Loan Bank
of Pittsburgh.
Savings deposits increased by $2,165,000 to $25,428,000 between the two dates,
while jumbo certificates, those deposits issued for values exceeding $100,000,
decreased by $2,045,000 to $2,562,000 between the two dates. Each of the other
major categories of deposits increased or decreased by less than 3.0%. The
growth in savings deposits amounted to a 9.3% increase while the decline in
jumbo certificates amounted to a 44.4% decrease. As questions about the
direction interest rates will take increase, fewer consumers are willing to
commit their funds to longer term deposits. This unwillingness to commit is
reflected in the growth in savings deposits.
Other funding sources, both short term and long term, increased by $6,221,000
from $1,000,000 at December 31, 1995 to $7,221,000 at June 30, 1996, an
increase of 622.1%. Much of this increase ($5,000,000) was borrowed from
available funding sources at the Federal Home Loan Bank of Pittsburgh, and
reflects a growing willingness among community banks to borrow from that
institution when asset growth exceeds deposit growth.
Other liabilities remained relatively stable between the two dates.
Stockholders' Equity decreased by $56,000 or 0.3% from $16,277,000 at December
31, 1995 to $16,221,000 at June 30, 1996.
Results of Operations
Six Month Periods Ended June 30, 1996 and 1995
The Company's net interest income increased to $3,369,000 for the first six
months of 1996 compared to $2,990,000 for the same period in 1995, an increase
of $379,000 or 12.7%. Both interest income and interest expense increased
during the periods, with interest income increasing by $566,000 while interest
expense increased by only $187,000.
Interest and fees on loans increased to $4,893,000 for the six months ended
June 30, 1996. For the same period in 1995 only $4,443,000 was earned, an
increase of $450,000 or 10.1%. The majority of this increase, $278,000 or
61.8%, came from increased interest income on mortgages, which reflects the
increased mortgage loans outstanding as of June 30, 1996.
Interest on investment securities increased by $149,000, or 15.1% from the
first six months of 1996 compared to the first six months of 1995. The yield
on the investment portfolio improved by .25% between the two periods as the
adjustable rate pooled mortgage securities repriced upward over the period.
Other interest income, including interest on federal funds sold decreased by
$33,000 or 73.3% from $45,000 for the first six months of 1995 compared with
the first six months of 1996 when it totaled only $12,000. The utilization of
substantially all of the available federal funds sold during the first six
months of 1996 accounted for this decrease in income.
Interest on deposits increased by $329,000 while interest on other borrowed
funds decreased by $142,000 during the first half of 1996 compared with the
first half of 1995 accounting for the net increase of $187,000 highlighted
above. Net interest income after the provision for loan losses increased from
$2,815,000 for the first six months of 1995 to $3,229,000 for the first six
months of 1996, an increase of $414,000 or 14.7%.
The provision for loan losses decreased between the two periods, with $140,000
being set aside from 1996's earnings compared with $175,000 from 1995's
earnings, a decrease of $35,000 or 20.0%. The allocation of the allowance for
losses, completed on a quarterly basis, combined with the removal of specific
problem loans from the analysis because of the foreclosure process, allowed
the Bank to decrease its' contribution from current earnings.
Other income increased from $245,000 for the first six months of 1995 to
$291,000 for the first six months of 1996, an increase of $46,000 or 18.8%.
Within this total, mortgage banking services increased by $30,000 representing
65.2% of the increase, while customer service fees increased by $11,000 or
8.3%.
Other expenses increased by a combined $98,000 or 4.1% between the first six
months of 1995 and the first six months of 1996, growing from $2,373,000 to
$2,471,000, respectively. Salaries and wages increased from $1,128,000 for the
first half of 1995 to $1,165,000 for the first half of 1996, an increase of
$37,000 or 3.3%. Total occupancy and equipment expenses increased from
$317,000 for the first half of 1995 to $348,000 for the first half of 1996, an
increase of $31,000 or 9.8%.
Insurance on deposits decreased by $130,000, almost 100% as the Bank paid the
regulatory minimum $500 per quarter for each of the first two quarters of
1996. Computer processing expenses increased by $15,000 for the first half of
1996 increasing from $132,000 for the period in 1995 to $147,000 for the
period in 1996, an increase of 11.4%.
Other operating expenses increased by $145,000 or 21.8% between the first half
of 1995 and the first half of 1996, growing from $665,000 to $810,000,
respectively. Included within this increase is an amount paid to maintain and
subsequently dispose of certain real estate, upon which the Bank had
foreclosed. The total expense associated with this real estate for the first
half of 1996 was $105,000 compared with $14,000 for the same period in 1995,
an increase of $91,000 or 650.0%. These types of expenses are not considered
to be recurring in nature, and account for 62.8% of the total increase in
other operating expenses.
Income before income taxes improved by $362,000 or 52.7% from $687,000 to
$1,049,000. After taxes of $137,000 for the first six months of 1995 and
$259,000 for the first six months of 1996, net income improved by 43.6%
between the two periods and amounted to $550,000 and $790,000 respectively, an
increase of $240,000.
Net income per share for the 1,191,171 shares outstanding amounted to $.46 per
share for the first six months of 1995 compared with $.66 per share for the
same period in 1996. Stockholders were paid $.22 per share in dividends during
the first six months of 1995 compared with $.24 per share during the first six
months of 1996.
Three Month Periods Ended June 30, 1996 and 1995
Net interest income for the quarter ended June 30, 1996 increased by 12.9% or
$193,000 from the same period in 1995. Net interest income totaled $1,689,000
during that period in 1996 compared with $1,496,000 in 1995.
Total interest income improved to $3,023,000 for the three months ended June
30, 1996 compared with $2,793,000 during the same period in 1995, an
improvement of $230,000 or 8.2%. Of that total improvement, $190,000 came from
increased interest and fees on loans, while $77,000 came from increased
taxable interest on investment securities. Other interest income, consisting
mainly of interest on federal funds sold, decreased by $35,000.
Interest on deposits increased by $40,000 or 3.2% from the second quarter of
1995 to the second quarter of 1996 and totalled $1,276,000 at that time.
The provision for loan losses amounted to $58,000 for the quarter, while
$65,000 was taken during the same period in 1995. This represents a decrease
of 10.8% or $7,000 between the two periods. Management believes the allowance
is adequate at June 30, 1996 based on its quarterly analysis of the loan
portfolio.
Customer service fees remained stable between the second quarter of 1995 and
the second quarter of 1996 decreasing by only $1,000 from $68,000 to $67,000
between the two periods. Other income improved by $19,000 or 29.7% growing
from $64,000 to $83,000. Increased income from mortgage banking activities
helped to contribute to this increase.
Total other expenses increased by 10.5% or $124,000 from $1,177,000 for the
three months ended June 30, 1995 to $1,301,000 for the three months ended June
30, 1996. Increases in other operating expenses, specifically, other real
estate owned related expenses more than offset the reduction in federal
insurance on deposits.
Income before taxes increased by 24.4% between the two quarters, growing by
$94,000 from $386,000 for the second quarter of 1995 to $480,000 for the
second quarter in 1996. The associated increase in income taxes amounted to
$35,000 and resulted in net income of $363,000 for the period in 1996 compared
with only $304,000 in 1995. This improvement in net income resulted in
earnings per share increasing from $.26 per share for the second quarter of
1995 to $.30 per share for the same period in 1996. Dividends paid to
stockholders amounted to $.11 per share and $.12 per share respectively.
Liquidity and Interest Rate Sensitivity
The banking industry has been required to adapt to an environment in which
interest rates have been volatile and deposit deregulation has provided
customers with the opportunity to invest in liquid, interest rate-sensitive
deposits. The banking industry has adapted to this environment by utilizing a
process known as asset/liability management.
Adequate liquidity means the ability to obtain sufficient cash to meet all
current and projected needs promptly and at a reasonable cost. These needs
include deposit withdrawal, liability runoff and increased loan demand. The
principal sources of liquidity are cash and due from banks, money market
investments, and all unpledged investment securities maturing within one
year. Maturing loans and loan payments are another source of liquidity. The
Bank can also package and sell residential mortgage loans in the secondary
market. Other sources of liquidity are the federal funds market, term
borrowings from the Federal Home Loan Banking System, and the discount window
of the Federal Reserve Banking System. In view of all factors involved, the
Banks's management believes that liquidity is being maintained at an adequate
level.
Asset/liability management is intended to provide for adequate liquidity and
interest rate sensitivity by matching interest rate-sensitive assets and
liabilities and coordinating maturities on assets and liabilities.
Approximately 25% of the commercial loan portfolio is sensitive to interest
rate changes. Other loans are written for relatively short terms and, except
for the majority of residential mortgage loans, provide for a readjustment of
the interest rate at specified times during the term of the loan. In
addition, interest rates offered for all types of deposit instruments are
reviewed weekly and are established on a basis consistent with funding needs
and maintaining a desirable spread between cost and return. The Bank does not
utilize repurchase agreements, reverse repurchase agreements, interest rate
swaps, or other derivative products in its asset/liability management
practices at this time.
<PAGE>
<TABLE>
The following table shows the repricing periods of interest earning assets and
interest bearing liabilities as of June 30, 1996:
INTEREST RATE SENSITIVITY
(Amounts in thousands)
<CAPTION>
Repricing Period
Within One Year to Over
One Year Five Years Five Years Total
<S> <C> <C> <C> <C>
Assets
Interest-bearing Balances $ 26 $ 0 $ 0 $ 26
Federal Funds Sold 0 0 0 0
Securities 11,293 22,055 3,816 37,164
Net Loans 37,316 20,943 52,127 110,386
______ ______ ______ _______
Total $ 48,635 $ 42,998 $ 55,943 $147,576
Liabilities
Total Interest-Bearing
Deposits $ 94,790 $ 23,268 $ 0 $118,058
Other Borrowed Funds 7,221 0 0 7,221
______ ______ ______ _______
Total $102,011 $ 23,268 $ 0 $125,279
______ ______ ______ ______
Rate Sensitivity Gap $(53,376) $ 19,730 $ 55,943 $ 22,297
______ ______ ______ ______
<FN>
</TABLE>
Capital Adequacy
The following table provides information about the capital of the Bank as it
relates to regulatory minimums as of selected Balance Sheet dates:
<TABLE>
<CAPTION>
Actual
Regulatory June 30, Dec. 31,
Minimum 1996 1995
<S> <C> <C> <C>
Tier I Capital to Risk-Adjusted Assets 4.00% 16.00% 16.26%
Total Capital to Risk-Adjusted Assets 8.00% 17.24% 17.48%
Leverage Ratio 3.00% 10.31% 10.34%
</TABLE>
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to Vote of Security Holders
The Annual Meeting of the Stockholders of the Company was held on
April 9, 1996. The following individuals continued as directors
after the meeting:
John T. Connelly Michael D. Mathias
Joseph M. Fabrizio Harry J. O'Neill, III
Richard L. Henry Karen A. Rightmire
William J. Keller Alfred J. Weber
Louis D. Bruno Daniel W. Weist
A second item approved by the stockholders was the appointment of
Beard & Company, Inc. of Reading, Pennsylvania as the Company's
external auditors for the year ending 1996. This appointment is for
a one year term.
861,013 shares were voted for ratification of the appointment of
Beard & Company, Inc.
1,168 shares were voted against, and
4,995 shares were not voted.
Item 5. Other Information
The Board of Directors of First Leesport Bancorp, Inc. at its June
4, 1996 meeting, declared a $.12 per share cash dividend to be paid
July 15, 1996 to holders of record on July 1, 1996.
The Board of Directors accepted the resignation of David L. Loose
who cited personal reasons for leaving the Board.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
10.1 Supplemental Executive Retirement Plan
(Attached)
10.2 Deferred Compensation Plan for Directors
(Attached)
(b) Reports on Form 8-K
None.
<PAGE>
THE FIRST NATIONAL BANK OF LEESPORT
SALARY CONTINUATION AGREEMENT
THIS AGREEMENT is made this _____ day of ____________, 199__ by and between
The First National Bank of Leesport, Pennsylvania (the "Company"), and
____________________ (the "Executive").
INTRODUCTION
To encourage the Executive to remain an employee of the Company, the Company
is willing to provide salary continuation benefits to the Executive. The
Company will act through it s Compensation Committee (as defined herein) and
will pay the benefits from its general assets.
AGREEMENT
The Executive and the Company agree as follows:
Article 1
Definitions
1.1 Definitions. Whenever used in this Agreement, the following words
and phrases shall have the meanings specified:
1.1.1 "Change of Control" means the transfer of 51% or more of the
Company's outstanding voting common stock in a transaction or series of
related transactions followed within thirty-six (36) months by the Executive's
Termination of Employment for reasons other than death, disability or
retirement. For purposes of this Section 1.1.1 only, the term Company shall
include First Leesport Bancorp, Inc..
1.1.2 "Code" means the Internal Revenue Code of 1986, as amended.
References to a Code section shall be deemed to be to that section as it now
exists and to any successor provision.
1.1.4 "Compensation Committee" means the Compensation Committee of the
Company's Board of Directors or, if no such committee exists, the Company s
Executive Committee of the Company's Board of Directors, either of which shall
hereinafter be referred to as the Compensation Committee.
1.1.5 "Disability" means the Executive suffering a sickness, accident or
injury which, in the judgment of a physician satisfactory to the Company,
prevents the Executive from performing substantially all of the Executive's
normal duties for the Company. As a condition to any benefits, the Company
may require the Executive to submit to such physical or mental evaluations and
tests as the Company's Compensation Committee deems appropriate.
1.1.6 "Early Retirement Date" means the Executive attaining age 60.
1.1.7 "Normal Retirement Date" means the Executive attaining age 65.
1.1.8 "Projected Normal Retirement Benefit" means the sum total of the
Normal Retirement Benefits specified in Section 2.1.1 payable over the payment
period specified in Section 2.1.2.
1.1.9 "Termination of Employment" means the Executive's ceasing to be
employed by the Company, other than by reason of an approved leave of
absence.
Article 2
Lifetime Benefits
2.1 Normal Retirement Benefit. If the Executive terminates employment on
or after the Normal Retirement Date for reasons other than death, the Company
shall pay to the Executive the benefit described in this Section 2.1.
2.1.1 Amount of Benefit. The benefit under this Section 2.1 is (an amount
that varies for each executive) per month.
2.1.2 Payment of Benefit. The Company shall pay the benefit to the
Executive on the first day of each month commencing with the month following
the Retirement Date and continuing for 179 additional months.
2.2 Involuntary Termination Without Cause Benefit. If the Executive's
employment is involuntarily terminated without cause (as defined in Section
5.3) before the Normal Retirement Date, and for reasons other than death,
Disability or a change in control, the Company shall pay to the Executive the
benefit described in this Section 2.2.
2.2.1 Amount of Benefit. The benefit under this Section 2.2 is the benefit
calculated under Section 2.1.1 as if the date of the executive's involuntary
termination without cause were the Executive's Normal Retirement Date.
2.2.2 Payment of Benefit. The Company shall pay the benefit to the
Executive on the first day of each month commencing with the month following
the Executive's Normal Retirement Date and continuing for 179 additional
months.
2.3 Disability Benefit. If the Executive terminates employment for
Disability prior to the Normal Retirement Date, the Company shall pay to the
Executive the benefit described in this Section 2.3.
2.3.1 Amount of Benefit. The benefit under this Section 2.3 is the benefit
determined under Schedule A based on the date of the Executive's Termination
of Employment by reason of disability. Schedule A is calculated using the
interest method of accounting, a 8.5% discount rate, and assuming monthly
compounding and monthly benefit payments.
2.3.2 Payment of Benefit. The Company shall pay the benefit to the
Executive in a lump sum within 60 days after the Executive's Termination of
Employment.
2.3.3 Death Benefit upon Disability. In addition to the benefit under
Section 2.3.1, and upon the Executive terminating employment for Disability
prior to the Normal Retirement Date, the Company shall endorse a portion of
the death proceeds of a life insurance policy to Executive s Beneficiary in an
amount equal to Sixty Six (66%) of the difference between the amount of the
benefit specified in Section 2.3.1 and the Projected Normal Retirement
Benefit. In the event no life insurance policy is owned by the Company, the
Company shall pay to the Executive s beneficiary, within 60 days of the
Executive's death, a lump sum amount equal to the Projected Normal Retirement
Benefit less the amount of the benefit specified in Section 2.3.1.
2.4 Change of Control Benefit. Upon a Change of Control while the
Executive is in the active service of the Company, the Company shall pay to
the Executive the benefit described in this Section 2.4 in lieu of any other
benefit under this Agreement.
2.4.1 Amount of Benefit. The benefit under this Section 2.4 is the Normal
Retirement Benefit described in Section 2.1, calculated as if the Executive's
date of Termination of Employment were the Executive's Normal Retirement Date.
2.4.2 Payment of Benefit. The Company shall pay the benefit to the
Executive on the first day of each month commencing with the month following
the Executive's Normal Retirement Date and continuing for 179 additional
months.
2.5 Early Retirement Benefit. If the Executive's employment terminates
after the Early Retirement Date but before the Normal Retirement Date, and for
reasons other than death, Disability, or involuntary termination without cause
(as defined in Section 5.3) the Company shall pay to the Executive the benefit
described in this Section 2.5.
2.5.1 Amount of Benefit. The benefit under this Section 2.5 is the
benefit determined under Schedule A based on the date of the Executive's
Termination of Employment. Schedule A is calculated using the interest method
of accounting, a 8.5% discount rate, and assuming monthly compounding and
monthly benefit payments.
2.5.2 Payment of Benefit. The Company shall pay the benefit to the
Executive in 180 equal monthly installments commencing on the first day of the
month following the Executive's Normal Retirement Date. The Company shall
continue to credit interest at the annual rate of 8.5% on the remaining
account balance during any applicable installment period.
Article 3
Death Benefits
3.1 Death During Active Service. If the Executive dies while in the
active service of the Company, the Company shall pay to the Executive's
beneficiary the benefit described in this Section 3.1.
3.1.1 Amount of Benefit. The benefit under Section 3.1 is the lifetime
benefit that would have been paid to the Executive under Section 2.1
calculated as if the date of the Executive's death were the Normal Retirement
Date.
3.1.2 Payment of Benefit. The Company shall pay the benefit to the
Beneficiary on the first day of each month commencing with the month following
the Executive's death and continuing for 179 additional months.
3.2 Death During Benefit Period. If the Executive dies after benefit
payments have commenced under this Agreement but before receiving all such
payments, the Company shall pay the remaining benefits to the Executive's
beneficiary at the same time and in the same amounts they would have been paid
to the Executive had the Executive survived.
3.3 Death After Involuntary Termination Without Cause or Early
Retirement. If the Executive dies after terminating employment for Involuntary
Termination Without Cause under Section 2.2 or Early Retirement under Section
2.3 but prior to commencement of benefit payments under this Agreement, the
Company shall pay to the Executive s beneficiary the benefit described in this
Section 3.3.
3.3.1 Amount of Benefit.The benefit under Section 3.3 is the lifetime
benefit that would have been paid to the Executive under Section 2.2 or
Section 2.5.
3.3.2 Payment of Benefit. The Company shall pay the benefit to the
Beneficiary on the first day of each month commencing with the month
following the Executive's death and continuing for 179 months.
Article 4
Beneficiaries
4.1 Beneficiary Designations. The Executive shall designate a
beneficiary by filing a written designation with the Compensation Committee.
The Executive may revoke or modify the designation at any time by filing a new
designation. However, designations will only be effective if signed by the
Executive and accepted by the Compensation Committee during the Executive's
lifetime. The Executive's beneficiary designation shall be deemed
automatically revoked if the beneficiary predeceases the Executive, or if the
Executive names a spouse as beneficiary and the marriage is subsequently
dissolved. If the Executive dies without a valid beneficiary designation, all
payments shall be made to the Executive's surviving spouse, if any, and if
none, to the Executive's surviving children and the descendants of any
deceased child by right of representation, and if no children or descendants
survive, to the Executive's estate.
4.2 Facility of Payment. If a benefit is payable to a minor, to a
person declared incompetent, or to a person incapable of handling the
disposition of his or her property, the Company may pay such benefit to the
guardian, legal representative or person having the care or custody of such
minor, incompetent person or incapable person. The Compensation Committee may
require proof of incompetency, minority or guardianship as it may deem
appropriate prior to distribution of the benefit. Such distribution shall
completely discharge the Company from all liability with respect to such
benefit.
Article 5
General Limitations
Notwithstanding any provision of this Agreement to the contrary, the Company
shall not pay any benefit under this Agreement:
5.1 Excess Parachute Payment. To the extent the benefit would be an
excess parachute payment under Section 280G of the Code.
5.2 Voluntary Termination. Except in the event of Normal Retirement,
Disability, Change of Control, or Early Retirement as specified in Sections
2.1, 2.3, 2.4, and 2.5 herein, if the Executive Terminates Employment
voluntarily.
5.3 Termination for Cause. If the Company terminates the Executive's
employment for:
5.3.1 Gross negligence or gross neglect of duties;
5.3.2 Commission of a felony or of a gross misdemeanor involving moral
turpitude; or
5.3.3 Fraud, disloyalty, dishonesty or willful violation of any law or
significant Company policy committed in connection with the Executive's
employment and resulting in an adverse effect on the Company.
5.4 Suicide. No benefits shall be payable if the Executive commits
suicide within two years after the date of this Agreement, or if the Executive
has made any material misstatement of fact on any application for life
insurance purchased by the Company.
5.5 Market Price Condition Subsequent. If the common stock of First
Leesport Bancorp, Inc. does not attain a market price of at least $21.00 per
share prior to July 31, 2000. In order to obtain a market price of $21.00 per
share at least 500 shares of common stock must be traded by a party not
affiliated with this Agreement at a price not less than $21.00. If the market
price reflects changes in the number of common shares outstanding resulting
from stock splits, stock dividends or similar subdivisions or reclassification
of such common stock, the Compensation Committee shall restate the market
price to nullify any affect of a stock split, stock dividend, subdivision or
reclassification. The market price threshold of $21.00 as stated herein, is
implemented to assure shareholder value to the Company. In the event the
threshold is not reached within the time period allotted, the parties agree to
negotiate in good faith, either a new threshold or some other methodology for
attaining shareholder value. The Compensation Committee shall negotiate on
the Company s behalf, whereby the negotiated result shall replace this Section
5.5 in its entirety.
5.6 Non-competition During and After Employment. If the Executive,
while in the Company's employ, or during any benefit period, actively engages
in, either directly or indirectly, any business or other activity which is or
may be deemed to be in any way competitive with or adverse to the best
interests of the business of the Company. The Executive shall be considered
competitive with or adverse to the best interests of the business of the
Company, where the Executive, without the prior written consent of the
Compensation Committee, engages in, becomes interested in, directly or
indirectly, as a sole proprietor, as a partner in a partnership, or as a
substantial shareholder in a corporation, or becomes associated with, in the
capacity of employee, director, officer, principal, agent, trustee or in any
other capacity whatsoever, any enterprise conducted in the trading area of the
business of the Company which enterprise is, or may deemed to be, competitive
with any business carried on by the Company.
Article 6
Claims and Review Procedures
6.1 Claims Procedure. The Compensation Committee shall notify the
Executive's beneficiary in writing, within ninety (90) days of his or her
written application for benefits, of his or her eligibility or noneligibility
for benefits under the Agreement. If the Compensation Committee determines
that the beneficiary is not eligible for benefits or full benefits, the notice
shall set forth (1) the specific reasons for such denial, (2) a specific
reference to the provisions of the Agreement on which the denial is based, (3)
a description of any additional information or material necessary for the
claimant to perfect his or her claim, and a description of why it is needed,
and (4) an explanation of the Agreement's claims review procedure and other
appropriate information as to the steps to be taken if the beneficiary wishes
to have the claim reviewed. If the Compensation Committee determines that
there are special circumstances requiring additional time to make a decision,
the Compensation Committee shall notify the beneficiary of the special
circumstances and the date by which a decision is expected to be made, and may
extend the time for up to an additional ninety-day period.
6.2 Review Procedure. If the beneficiary is determined by the
Compensation Committee not to be eligible for benefits, or if the beneficiary
believes that he or she is entitled to greater or different benefits, the
beneficiary shall have the opportunity to have such claim reviewed by the
Compensation Committee by filing a petition for review with the Compensation
Committee within sixty (60) days after receipt of the notice issued by the
Compensation Committee. Said petition shall state the specific reasons which
the beneficiary believes entitle him or her to benefits or to greater or
different benefits. Within sixty (60) days after receipt by the Compensation
Committee of the petition, the Compensation Committee shall afford the
beneficiary (and counsel, if any) an opportunity to present his or her
position to the Compensation Committee orally or in writing, and the
beneficiary (or counsel) shall have the right to review the pertinent
documents. The Compensation Committee shall notify the beneficiary of its
decision in writing within the sixty-day period, stating specifically the
basis of its decision, written in a manner calculated to be understood by the
beneficiary and the specific provisions of the Agreement on which the decision
is based. If, because of the need for a hearing, the sixty-day period is not
sufficient, the decision may be deferred for up to another sixty-day period at
the election of the Compensation Committee, but notice of this deferral shall
be given to the beneficiary.
Article 7
Amendments and Termination
Except for changes required by law or regulation, this Agreement may be
amended or terminated only by a written agreement signed by the Company and
the Executive.
Article 8
Miscellaneous
8.1 Binding Effect. This Agreement shall bind the Executive and the
Company, and their beneficiaries, survivors, executors, administrators and
transferees.
8.2 No Guaranty of Employment. This Agreement is not an employment
policy or contract. It does not give the Executive the right to remain an
employee of the Company, nor does it interfere with the Company's right to
discharge the Executive. It also does not require the Executive to remain an
employee nor interfere with the Executive's right to terminate employment at
any time.
8.3 Non-Transferability. Benefits under this Agreement cannot be sold,
transferred, assigned, pledged, attached or encumbered in any manner.
8.4 Tax Withholding. The Company shall withhold any taxes that are
required to be withheld from the benefits provided under this Agreement.
8.5 Applicable Law. The Agreement and all rights hereunder shall be
governed by the laws of Pennsylvania, except to the extent preempted by the
laws of the United States of America.
8.6 Unfunded Arrangement. The Executive and beneficiary are general
unsecured creditors of the Company for the payment of benefits under this
Agreement. The benefits represent the mere promise by the Company to pay such
benefits. The rights to benefits are not subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
attachment, or garnishment by creditors. Any insurance on the Executive's
life is a general asset of the Company to which the Executive and beneficiary
have no preferred or secured claim.
8.7 Five Year Review. The Compensation Committee shall reassess the
major provisions of this agreement every fifth plan year that this Agreement
is in force. The Compensation Committee is not required to amend this
Agreement in any fashion, however a good-faith review of the benefits and
conditions provided herein and whether or not they continue to be applicable
shall be performed. This five year review shall specifically include a review
of the benefits provided herein and whether or not they should be adjusted for
inflation.
IN WITNESS WHEREOF, the Executive and a duly authorized Company officer have
signed this Agreement.
EXECUTIVE: COMPANY:
The First National Bank of Leesport
_______________________ By __________________________
(Executive)
Title _______________________
<PAGE>
THE FIRST NATIONAL BANK OF LEESPORT
DEFERRED FEE AGREEMENT
THIS AGREEMENT is made this ____ day of ____________, 199__ by and between
The First National Bank of Leesport, Pennsylvania (the "Company"), and
___________________ (the "Director").
INTRODUCTION
To encourage the Director to remain a member of the Company's Board of
Directors, the Company is willing to provide to the Director a deferred fee
opportunity. The Company will pay the benefits from its general assets.
AGREEMENT
The Director and the Company agree as follows:
Article 1
Definitions
1.1 Definitions. Whenever used in this Agreement, the following words
and phrases shall have the meanings specified:
1.1.1 "Change of Control" means the transfer of 51% or more of the
Company's outstanding voting common stock followed within thirty-six (36)
months by termination of the Director's status as a member of the Company's
Board of Directors. For purposes of this Section 1.1.1 only, the term
Company shall include First Leesport Bancorp, Inc..
1.1.2 "Code" means the Internal Revenue Code of 1986, as amended.
References to a Code section shall be deemed to be to that section as it now
exists and to any successor provision.
1.1.3 "Disability" means the Director's inability to perform substantially
all normal duties of a director, as determined by the Company's Board of
Directors in its sole discretion. As a condition to any benefits, the Company
may require the Director to submit to such physical or mental evaluations and
tests as the Board of Directors deems appropriate.
1.1.4 "Election Form" means the Form attached as Exhibit 1.
1.1.5 "Fees" means the total directors fees payable to the Director.
1.1.6 "Normal Termination Date" means the Director attaining age 70.
1.1.8 "Termination of Service" means the Director's ceasing to be a member
of the Company's Board of Directors for any reason whatsoever.
Article 2
Deferral Election
2.1 Initial Election. The Director shall make an initial deferral
election under this Agreement by filing with the Company a signed Election
Form within 30 days after the date of this Agreement. The Election Form shall
set forth the amount of Fees to be deferred. The Election Form shall be
effective to defer only Fees earned after the date the Election Form is
received by the Company.
2.2 Election Changes
2.2.1 Generally. The Director may modify the amount of Fees to be deferred
by filing a subsequent signed Election Form with the Company. The modified
deferral shall not be effective until the calendar year following the year in
which the subsequent Election Form is received by the Company. The Director
may not change the form of benefit payment initially elected under Section
2.1.
2.2.2 Hardship. If an unforeseeable financial emergency arising from the
death of a family member, divorce, sickness, injury, catastrophe or similar
event outside the control of the Director occurs, the Director, by written
instructions to the Company may cease deferrals under this Agreement.
Article 3
Deferral Account
3.1 Establishing and Crediting. The Company shall establish a Deferral
Account on its books for the Director, and shall credit to the Deferral
Account the following amounts:
3.1.1 Deferrals. The Fees deferred by the Director as of the time the Fees
would have otherwise been paid to the Director.
3.1.2 Interest. On each anniversary of the date of this Agreement and
immediately prior to the payment of any benefits, interest on the account
balance since the preceding credit under this Section 3.1.2, if any, at an
annual rate, compounded monthly, equal to 8%.
3.2 Statement of Accounts. The Company shall provide to the Director,
within one hundred twenty (120) days after each anniversary of this Agreement,
a statement setting forth the Deferral Account balance.
3.3 Accounting Device Only. The Deferral Account is solely a device for
measuring amounts to be paid under this Agreement. The Deferral Account is
not a trust fund of any kind. The Director is a general unsecured creditor of
the Company for the payment of benefits. The benefits represent the mere
Company promise to pay such benefits. The Director's rights are not subject
in any manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance, attachment, or garnishment by the Director's creditors.
Article 4
Lifetime Benefits
4.1 Normal Termination Benefit. If the Director terminates sevice as a
Director on or after Normal Termination Date, and for reasons other than death
or Disability, the Company shall pay to the Director the benefit described in
this Section 4.1.
4.1.1 Amount of Benefit. The benefit under this Section 4.1 is the
Deferral Account balance at the Director's Termination of Service.
4.1.2 Payment of Benefit. The Company shall pay the benefit to the
Director in 120 equal monthly installments commencing on the first day of the
month following the Director's Termination of Service. The Company shall
continue to credit interest at the annual rate of 8% on the remaining account
balance during any applicable installment period.
4.2 Early Termination Benefit. If the Director terminates service as a
director before the Normal Termination Date, and for reasons other than death
or Disability, the Company shall pay to the Director the benefit described in
this Section 4.2.
4.2.1 Amount of Benefit. The benefit under this Section 4.2 is the
Deferral Account balance at the Director's Termination of Service.
<PAGE>
4.2.2 Payment of Benefit. The Company shall pay the benefit to the
Director in a lump sum within 60 days after the Director's Termination of
Service.
4.3 Disability Benefit. If the Director terminates service as a director
for Disability prior to the Normal Retirement Date, the Company shall pay to
the Director the benefit described in this Section 4.3.
4.3.1 Amount of Benefit. The benefit under this Section 4.3 is the
Deferral Account balance at the Director's Termination of Service.
4.3.2 Payment of Benefit. The Company shall pay the benefit to the
Director in 120 equal monthly installments commencing on the first day of the
month following the Director's Termination of Service. The Company shall
continue to credit interest at the annual rate of 8% on the remaining account
balance during any applicable installment period.
4.3.3 Death Benefit upon Disability. In addition to the benefit under
Section 4.3.1, the Company shall endorse a portion of the death proceeds of a
life insurance policy to Director's Beneficiary in an amount equal to Sixty
Seven (67%) of the difference between the Deferral Account Balance specified
in Section 4.3.1 and (an amount that varies for each director). In the event
no life insurance policy is owned by the Company, the Company shall pay to
the Director's beneficiary, within 60 days of the Director s death, a lump
sum amount equal to (an amount that varies for each director) less the
Deferral Account Balance specified in Section 4.3.1.
4.4 Change of Control Benefit. Upon a Change of Control while the
Director is in the active service of the Company, the Company shall pay to the
Director the benefit described in this Section 4.4 in lieu of any other
benefit under this Agreement.
4.4.1 Amount of Benefit. The benefit under this Section 4.4 is the
Deferral Account balance at the date of the Director's Termination of Service.
4.4.2 Payment of Benefit. The Company shall pay the benefit to the
Director in 120 equal monthly installments commencing on the first day of the
month following the Director's Termination of Service. The Company shall
continue to credit interest at the annual rate of 8% on the remaining account
balance during any applicable installment period.
4.5 Hardship Distribution. Upon the Company's determination (following
petition by the Director) that the Director has suffered an unforeseeable
financial emergency as described in Section 2.2.2, the Company shall
distribute to the Director all or a portion of the Deferral Account balance as
determined by the Company, but in no event shall the distribution be greater
than is necessary to relieve the financial hardship.
Article 5
Death Benefits
5.1 Death During Active Service. If the Director dies while in the
active service of the Company, the Company shall pay to the Director's
beneficiary the benefit described in this Section 5.1.
5.1.1 Amount of Benefit. The benefit under Section 5.1 is the greater of:
(1) the Director's Deferral Account balance on the day before the Director's
death or (2) (an amount that varies for each director).
5.1.2 Payment of Benefit. The Company shall pay the benefit to the
beneficiary in 120 equal monthly installments commencing on the first day of
the month following the Director's Death. The Company shall continue to
credit interest at the annual rate of 8% on the remaining account balance
during any applicable installment period.
5.2 Death During Benefit Period. If the Director dies after benefit
payments have commenced under this Agreement but before receiving all such
payments, the Company shall pay the remaining benefits to the Director's
beneficiary at the same time and in the same amounts they would have been paid
to the Director had the Director survived.
Article 6
Beneficiaries
6.1 Beneficiary Designations. The Director shall designate a beneficiary
by filing a written designation with the Company. The Director may revoke or
modify the designation at any time by filing a new designation. However,
designations will only be effective if signed by the Director and accepted by
the Company during the Director's lifetime. The Director's beneficiary
designation shall be deemed automatically revoked if the beneficiary
predeceases the Director, or if the Director names a spouse as beneficiary and
the marriage is subsequently dissolved. If the Director dies without a valid
beneficiary designation, all payments shall be made to the Director's
surviving spouse, if any, and if none, to the Director's surviving children
and the descendants of any deceased child by right of representation, and if
no children or descendants survive, to the Director's estate.
6.2 Facility of Payment. If a benefit is payable to a minor, to a person
declared incompetent, or to a person incapable of handling the disposition of
his or her property, the Company may pay such benefit to the guardian, legal
representative or person having the care or custody of such minor, incompetent
person or incapable person. The Company may require proof of incompetency,
minority or guardianship as it may deem appropriate prior to distribution of
the benefit. Such distribution shall completely discharge the Company from
all liability with respect to such benefit.
Article 7
General Limitations
Notwithstanding any provision of this Agreement to the contrary, the Company
shall not pay any benefit under this Agreement that is attributable to the
interest earned on such contributions:
7.1 Excess Parachute Payment. To the extent the benefit would be an
excess parachute payment under Section 280G of the Code.
7.2 Termination for Cause. If the Company terminates the Director's
service as a director for:
7.2.1 Gross negligence or gross neglect of duties;
7.2.2 Commission of a felony or of a gross misdemeanor involving moral
turpitude; or
7.2.3 Fraud, disloyalty, dishonesty or willful violation of any law or
significant Company policy committed in connection with the Director's service
and resulting in an adverse financial effect on the Company.
7.3 Suicide. If the Director commits suicide within two years after the
date of this Agreement, or if the Director has made any material misstatement
of fact on any application for life insurance purchased by the Company.
Article 8
Claims and Review Procedures
8.1 Claims Procedure. The Company shall notify the Director's
beneficiary in writing, within ninety (90) days of his or her written
application for benefits, of his or her eligibility or noneligibility for
benefits under the Agreement. If the Company determines that the beneficiary
is not eligible for benefits or full benefits, the notice shall set forth (1)
the specific reasons for such denial, (2) a specific reference to the
provisions of the Agreement on which the denial is based, (3) a description of
any additional information or material necessary for the claimant to perfect
his or her claim, and a description of why it is needed, and (4) an
explanation of the Agreement's claims review procedure and other appropriate
information as to the steps to be taken if the beneficiary wishes to have the
claim reviewed. If the Company determines that there are special
circumstances requiring additional time to make a decision, the Company shall
notify the beneficiary of the special circumstances and the date by which a
decision is expected to be made, and may extend the time for up to an
additional ninety-day period.
8.2 Review Procedure. If the beneficiary is determined by the Company
not to be eligible for benefits, or if the beneficiary believes that he or she
is entitled to greater or different benefits, the beneficiary shall have the
opportunity to have such claim reviewed by the Company by filing a petition
for review with the Company within sixty (60) days after receipt of the notice
issued by the Company. Said petition shall state the specific reasons which
the beneficiary believes entitle him or her to benefits or to greater or
different benefits. Within sixty (60) days after receipt by the Company of
the petition, the Company shall afford the beneficiary (and counsel, if any)
an opportunity to present his or her position to the Company orally or in
writing, and the beneficiary (or counsel) shall have the right to review the
pertinent documents. The Company shall notify the beneficiary of its decision
in writing within the sixty-day period, stating specifically the basis of its
decision, written in a manner calculated to be understood by the beneficiary
and the specific provisions of the Agreement on which the decision is based.
If, because of the need for a hearing, the sixty-day period is not sufficient,
the decision may be deferred for up to another sixty-day period at the
election of the Company, but notice of this deferral shall be given to the
beneficiary.
Article 9
Amendments and Termination
This Agreement may be amended or terminated only by a written agreement signed
by the Company and the Director.
Article 10
Miscellaneous
10.1 Binding Effect. This Agreement shall bind the Director and the
Company, and their beneficiaries, survivors, executors, administrators and
transferees.
10.2 No Guaranty of Service. This Agreement is not a contract for
services. It does not give the Director the right to remain a director of the
Company, nor does it interfere with the shareholders' rights to replace the
Director. It also does not require the Director to remain a director nor
interfere with the Director's right to terminate services at any time.
10.3 Non-Transferability. Benefits under this Agreement cannot be sold,
transferred, assigned, pledged, attached or encumbered in any manner.
10.4 Tax Withholding. The Company shall withhold any taxes that are
required to be withheld from the benefits provided under this Agreement.
10.5 Applicable Law. The Agreement and all rights hereunder shall be
governed by the laws of Pennsylvania, except to the extent preempted by the
laws of the United States of America.
10.6 Unfunded Arrangement. The Director and beneficiary are general
unsecured creditors of the Company for the payment of benefits under this
Agreement. The benefits represent the mere promise by the Company to pay such
benefits. The rights to benefits are not subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
attachment, or garnishment by creditors. Any insurance on the Director's life
is a general asset of the Company to which the Director and beneficiary have
no preferred or secured claim.
IN WITNESS WHEREOF, the Director and a duly authorized Company officer have
signed this Agreement.
DIRECTOR: COMPANY:
The First National Bank of Leesport
_______________________ By __________________________
(Director) Title _______________________
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the Registrant
caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
FIRST LEESPORT BANCORP, INC.
(Registrant)
Dated: August 13, 1996 By John T. Connelly
John T. Connelly
President and
Chief Executive Officer
Dated: August 13, 1996 By Frederick P. Henrich
Frederick P. Henrich
Treasurer and
Chief Accounting Officer
<PAGE>
[ARTICLE] 9
<TABLE>
<S> <C>
[PERIOD-TYPE] QTR-2
[FISCAL-YEAR-END] DEC-31-1996
[PERIOD-END] JUN-30-1996
[CASH] 4845
[INT-BEARING-DEPOSITS] 26
[FED-FUNDS-SOLD] 0
[TRADING-ASSETS] 0
[INVESTMENTS-HELD-FOR-SALE] 0
[INVESTMENTS-CARRYING] 0
[INVESTMENTS-MARKET] 37164
[LOANS] 111641
[ALLOWANCE] 1255
[TOTAL-ASSETS] 159162
[DEPOSITS] 134293
[SHORT-TERM] 2221
[LIABILITIES-OTHER] 1427
[LONG-TERM] 5000
[COMMON] 6000
[PREFERRED-MANDATORY] 0
[PREFERRED] 0
[OTHER-SE] 10221
[TOTAL-LIABILITIES-AND-EQUITY] 159162
[INTEREST-LOAN] 4893
[INTEREST-INVEST] 1137
[INTEREST-OTHER] 12
[INTEREST-TOTAL] 6042
[INTEREST-DEPOSIT] 2597
[INTEREST-EXPENSE] 2673
[INTEREST-INCOME-NET] 3369
[LOAN-LOSSES] 140
[SECURITIES-GAINS] 0
[EXPENSE-OTHER] 2471
[INCOME-PRETAX] 1049
[INCOME-PRE-EXTRAORDINARY] 790
[EXTRAORDINARY] 0
[CHANGES] 0
[NET-INCOME] 790
[EPS-PRIMARY] .66
[EPS-DILUTED] .66
[YIELD-ACTUAL] 4.64
[LOANS-NON] 1025
[LOANS-PAST] 364
[LOANS-TROUBLED] 1252
[LOANS-PROBLEM] 0
[ALLOWANCE-OPEN] 1179
[CHARGE-OFFS] 98
[RECOVERIES] 34
[ALLOWANCE-CLOSE] 1255
[ALLOWANCE-DOMESTIC] 0
[ALLOWANCE-FOREIGN] 0
[ALLOWANCE-UNALLOCATED] 1255
</TABLE>
