Severance Plan

Amendment Number One to Hudson United Bancorp Severance Plan

Exhibit 10.2

 

AMENDMENT NUMBER ONE TO
HUDSON UNITED BANCORP
SEVERANCE PLAN

            BY THIS AMENDMENT NUMBER ONE, the Hudson United Bancorp (the“Company”) Severance Plan is hereby amended as follows, effective July 11, 2005:

WITNESSETH:

         WHEREAS, TD Banknorth Inc. (“TD Banknorth”) has agreed that the Company amend its Severance Plan as set forth below prior to the execution of an Agreement and Plan of Merger in order to provide for enhanced severance to officers and employees and to make certain other changes; and

         WHEREAS, the Company believes that the Amendment is in the best interests of the Company.

         NOW, THEREFORE, BE IT RESOLVED, that the Board of Directors of the Company has duly adopted the amendments to the Severance Plan as set forth below.

         1.     Section 2 of the Severance Plan is amended to add new Sections 2c and 2d to read in their entirety as follows, with existing Sections 2c through 2l to be re-numbered as appropriate:

  “c.    “Change of Control” shall mean a change in the ownership of the 
      Company, a change in the effective control of the Company or a change in 
      the ownership of a substantial portion of the assets of the Company as 
      provided under Section 409A of the Code, as amended from time to time, 
      and any Internal Revenue Service guidance, including Notice 2005-1, and 
      regulations issued in connection with Section 409A of the Code. 

  d.    “Code” shall mean the Internal Revenue Code of 1986, as amended from 
      time to time.” 

         2.     Existing Section 2l of the Severance Plan, which has been re-numbered as new Section 2n pursuant to Section 1 of this Amendment, is amended to read in its entirety as follows:

  “n.    “Years of Service” shall mean the period of service with the Company 
      commencing on the Participant’s most recent date of hire and ending on 
      the Participant’s date of Termination. If the Participant was previously 
      employed by the Employer and was subsequently re-hired after a break in 
      service, only service from the most recent date of hire shall be taken into 
      account. Years of Service with a predecessor employer shall be taken into 
      account only if so specified in the acquisition agreement with such 
        predecessor employer. A completed Year of Service shall mean a 365 day 
        period, ending on the anniversary of the most recent date of hire.” 


        3.      Section 3b of the Severance Plan is amended to read in its entirety as follows: 

    “b.    Terminations Which Give Rise to Severance Pay 
 
        A Participant is entitled to receive Severance Pay if the Company 
        permanently terminates the Participant’s employment either before a 
        Change of Control or within 12 months following a Change of Control due 
        to (i) conversion of a full-time position to a part-time position (and the 
        Participant refuses to accept said position); (ii) a reduction in force; or 
        (iii) an involuntary termination for reasons other than those set forth in 
        Section 3c below.” 
 

        4.      Section 3d of the Severance Plan is amended to read in its entirety as follows:

       
    “d.  Receipt of Severance Pay 

  Severance Pay shall be payable in a lump sum on the first regularly 
  scheduled payroll date that occurs at least ten (10) business days after the 
  later of (i) the date the Plan Administrator receives from the Participant a 
  signed Separation Agreement and General Release (the “Release”), (ii) the 
  expiration of the revocation period set forth in the Release, and (iii) the 
  date of Termination, provided that such payment shall be delayed for key 
  employees for six months to the extent required by Section 409A of the 
  Code. The receipt of any Severance Pay hereunder is conditioned on a 
  written release of all claims against the Company in the form provided by 
  the Plan Administrator. In addition, the receipt of Severance Pay 
  hereunder is conditioned for the Chairman, President, Chief Executive 
  Officer and any Executive Vice President on the receipt of an executed 
  non-compete as further described below.” 
 

        5.     Section 4 of the Severance Plan is amended to read in its entirety as follows: 

       “4  .  Amount of Severance Pay 
 
     a.   Subject to Sections 4b and 4c below, each Participant who becomes 
        entitled to receive Severance Pay shall receive an amount determined in 
        accordance with the following schedule: 

2


    Years of Service        Severance Pay(1) 

 
Non-Officers    Completed less than 7 Years    12    weeks of Base Salary 
    of Service         
    Completed 7 to 12 Years of    2 weeks of Base Salary 
    Service    per Year of Service 
    Completed 13 or more    26    weeks of Base Salary 
    Years of Service         
 
Officers up to and    Completed less than 5 Years    12    weeks of Base Salary 
including Vice    of Service         
Presidents             
    Completed 5 to 9 Years of    18    weeks of Base Salary 
    Service         
    Completed 10 to 14 Years of    26    weeks of Base Salary 
    Service         
 
 
    Completed 15 or more    32    weeks of Base Salary 
    Years of Service         
 
Senior Vice    Completed less than 5 Years    39    weeks of Base Salary 
Presidents    of Service         
    Completed 5 to 9 Years of    42    weeks of Base Salary 
    Service         
    Completed 10 to 14 Years of    45    weeks of Base Salary 
    Service         
    Completed 15 or more    52    weeks of Base Salary 
    Years of Service         
 
First Senior Vice    Any Years of Service    52    weeks of Base Salary 
Presidents             
 
Executive Vice    Any Years of Service    52    weeks of Base Salary 
Presidents and the        plus bonus(2) 
President, CEO and             
Chairman             

3


  (1 )   To also include continuation of medical insurance at employee rates for 
      the number of weeks shown. In addition, each Participant who becomes 
      entitled to Severance Pay shall be deemed 100% vested in the 
      Participant’s Matching Contribution Account under the Hudson United Bancorp and 
      Subsidiaries Savings and Investment Plan, with such plan to be amended 
      as appropriate. 
 
  (2 )    The amount of the bonus in the above table for Executive Vice Presidents 
      and for the President, Chief Executive Officer and Chairman shall be an 
      amount equal to the highest annual bonus received during or for the two 
      calendar years immediately preceding their date of Termination; provided, 
      however, that the aggregate Severance Pay shall in no event exceed two 
      times the Participant’s Base Salary. 

  b.    The receipt of any Severance Pay by an Executive Vice President or by 
      the President, Chief Executive Officer and Chairman shall be conditioned 
      upon such person entering into a binding agreement with the Company 
      providing that such person, for a period of two years following the date of 
      termination, shall not, for himself or on behalf of any other person or 
      entity, directly or indirectly, (i) be employed in any capacity or serve as a 
      director or consultant for a commercial bank, savings bank or savings 
      association insured by the FDIC in the states in which the Company (or 
      any affiliate of the Company) maintains a branch or office at the date of 
      Termination, or (ii) solicit, divert, take away or attempt to take away any 
      customers of the Company (or any affiliate of the Company) or the 
      business of any such customers or in any way interfere with, disrupt or 
      attempt to disrupt any then-existing relationships between the Company 
      (or any affiliate of the Company) and any of its customers. 
 
  c.   If the Severance Pay pursuant to Section 4a hereof, either alone or 
      together with other payments and benefits which the Participant has the 
      right to receive from the Company or any of its subsidiaries or affiliates, 
      or any of their successors, would constitute a “parachute payment” under 
      Section 280G of the Code, the Severance Pay payable by the Company 
      pursuant to Section 4a hereof shall be reduced by the amount, if any, 
      which is the minimum necessary to result in no portion of the payments 
      and benefits payable by the Company under Section 4a being non- 
      deductible to the Company or any of its subsidiaries or affiliates, or any of 
      their successors, pursuant to Section 280G of the Code and subject to the 
      excise tax imposed under Section 4999 of the Code. The determination of 
      any reduction in the payments and benefits to be made pursuant to Section 
      4a shall be based upon the opinion of independent counsel selected by the 
      Company and paid by the Company. Nothing contained herein shall result 
      in a reduction of any payments or benefits to which the Participant may be 
      entitled upon termination of employment under any circumstances other
       than as specified in this Section 4c, or a reduction in the payments and
      benefits specified in Section 4a below zero. This Section 4c shall not apply
       to the President, Chief Executive Officer and Chairman of the Company.

4


        6.     All other provisions of the Severance Plan shall continue in full force and effect.

        IN WITNESS WHEREOF, this Amendment has been executed this 11th day of July 2005.

ATTEST:    HUDSON UNITED BANCORP 
 
 
By: _____________________________    By: _______________________________ 
         Name: James W. Nall           Name: Kenneth T. Neilson 
         Title: Executive Vice President           Title:   Chairman, President and Chief 
                 and Chief Financial Officer                      Executive Officer 

5