Director Deferred Compensation Agreement with David H. Koppenhaver

Exhibit 10.20

THIRD AMENDMENT TO THE
THE GRATZ NATIONAL BANK
DIRECTOR DEFERRED COMPENSATION AGREEMENT FOR
DAVID H. KOPPENHAVER

THIS THIRD AMENDMENT (the “Amendment”) is adopted effective the first day of January, 2012, by and between The Gratz National Bank, located in Gratz, Pennsylvania (the “Bank”), and David H. Koppenhaver (the “Director”).

The Bank and the Director are parties to a certain Director Deferred Compensation Agreement dated January 8, 2002 and amended two times subsequently (collectively, the “Agreement”). The Bank and the Director now wish to change the manner of calculating the interest credited on the deferred amounts in the Agreement.

Now, therefore, the Bank and the Director agree as follows.

Paragraph V. of the Agreement entitled “Interest on the Deferred Compensation Account” shall be deleted and replaced with the following:

On December 31 of each year for as long as there is a balance in the Directors Deferred Compensation Account, the Directors Deferred Compensation Account shall be credited with an amount in addition to the fees credited under Paragraph IV. Such annual amount shall be determined by multiplying the balance of the Directors Deferred Compensation Account by a rate of interest equal to one hundred fifty percent (150%) of the average of the interest rate on the ten year Treasury instrument for the plan year as quoted in the Wall Street Journal. Notwithstanding the foregoing, at no time shall the Crediting Rate be less than two percent (2.0%) or greater than six percent (6.0%).

IN WITNESS WHEREOF, the Director and a representative of the Bank have executed this Amendment as indicated below:

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409A Amendment
to the

Gratz National Bank

Director Deferred Compensation Agreement for
David H. Koppenhaver

The Gratz National Bank (“Bank”) and David H. Koppenhaver (“Director”) originally entered into the Gratz National Bank Director Deferred Compensation Agreement (“Agreement”) on January 8, 2002, which was subsequently amended on December 29, 2006. Pursuant to Section XXII of the Agreement, the Bank and the Director hereby adopt this 409A Amendment, effective January 1, 2005.

RECITALS

This Amendment is intended to bring the Agreement into compliance with the requirements of Internal Revenue Code Section 409A. Accordingly, the intent of the parties hereto is that the Agreement shall be operated and interpreted consistent with the requirements of Section 409A. Therefore, the following changes shall be made:

ELECTION OF DEFERRED COMPENSATION

The Director shall, at the same time as entering into this Agreement, file a written statement with the Bank notifying the Bank as to the percent (%) or dollar amount of fees as defined in Section II that is to be deferred.

Deferral Elections – In General:

In any Plan Year during which Director defers compensation (as defined herein), Director shall file a Deferral Election Form for any compensation deferred. Such form shall be filed with the Plan Administrator no later than the close of the Director’s taxable year next preceding the service year, and such election and is effective only to defer compensation that has not yet been earned by the Director at the time of the election.

A deferral election submitted for a particular year may continue to be valid for succeeding years until changed or modified. Deferral elections, once made, however, are irrevocable as of the last permissible date on which such deferral elections may be made.

Initial Deferral Election(s):

Upon notification of eligibility in this Agreement during the initial Plan Year, and if Director elects to defer compensation, Director shall deliver to the Plan Administrator:

Director shall deliver such forms to the Plan Administrator within thirty (30) days of notification of eligibility, and shall set forth on the forms the amount of compensation to be deferred.

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Subsequent Changes to Time and Form of Payment:

The Bank may permit a subsequent change to form and timing of payments (a “subsequent deferral election”). Any such change shall be considered made only when it becomes irrevocable under the terms of the Agreement. Any subsequent deferral election will be considered irrevocable not later than thirty (30) days following acceptance of the change by the Plan Administrator, subject to the following rules:

PAYMENT OF MONTHLY INSTALLMENTS

Installment payments of deferred amounts shall commence on the first day of the calendar month following the Director’s Separation from Service due to resignation, removal, failure to be re-elected, or the Director’s sixty-fifth (65th) birthday.

Separation from Service:

Notwithstanding anything to the contrary in this Agreement, to the extent that any benefit under this Agreement is payable upon a “Termination of Employment,” “Termination of Service,” or other event involving the Director’s cessation of services, such payment(s) shall not be made unless such event constitutes a “Separation from Service” as defined in Treasury Regulations Section 1.409A-l(h).

Restriction on Timing of Distribution:

Notwithstanding any provision of this Agreement to the contrary, distributions under this Agreement may not commence earlier than six (6) months after the date of a Separation from Service (as described under the “Separation from Service” provision herein) if, pursuant to Internal Revenue Code Section 409A, the participant hereto is considered a “specified employee” (under Internal Revenue Code Section 416(i)) of the Bank if any stock of the Bank is publicly traded on an established securities market or otherwise. In the event a distribution is delayed pursuant to this Section, the originally scheduled distribution shall be delayed for six (6) months, and shall commence instead on the first day of the seventh month following Separation from Service. If payments are scheduled to be made in installments, the first six (6) months of installment payments shall be delayed, aggregated, and paid instead on the first day

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of the seventh month, after which all installment payments shall be made on their regular schedule. If payment is scheduled to be made in a lump sum, the lump sum payment shall be delayed for six (6) months and instead be made on the first day of the seventh month.

Certain Accelerated Payments:

The Bank may make any accelerated distribution permissible under Treasury Regulation l.409A-3(j)(4) to the Director of deferred amounts, provided that such distribution(s) meets the requirements of Section l.409A-3(j)(4).

Therefore, the foregoing changes are agreed to.

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FIRST AMENDMENT

TO THE DIRECTOR DEFERRED COMPENSATION AGREEMENT

DATED JANUARY 8, 2002

THIS AMENDMENT, made and entered into this 29th day of December, 2006, by and between The Gratz National Bank, a bank organized and existing under the laws of the United States of America, (hereinafter referred to as the “Bank”), and David H. Koppenhaver, a Director of the Bank, (hereinafter referred to as the “Director”), shall effectively amend the Director Deferred Compensation Agreement dated January 8, 2002 as follows:

1.) Paragraph IX, Death of Director Prior to Termination of Service or Commencement of Payments, shall be deleted in its entirety and replaced with the following:

In the event of the death of the Director prior to termination of service or commencement of payments, the Director’s account balance(1) shall be paid in a lump sum to such individual or individuals as the Director may have designated in writing and filed with the Bank. Said amount shall be paid on the first day of the second month following the death of the Director. In the event no designation is made, the Director’s account balance(1) shall be paid, in a lump sum, as set forth herein to the duly qualified executor or administrator of the Director’s estate. The amount of the payments to be made under this Paragraph shall be calculated as if the Director had survived to the later of five (5) years from October 28, 2001 or age sixty-five (65) and continued the dollar amount of deferrals made in the calendar year prior to the Director’s date of death until that time with an annual interest crediting rate equal to the rate applicable to the Plan Year prior to the Director’s date of death. The Bank shall annually calculate the amount payable pursuant to this Paragraph and advise the Director no later than June 30th the amount that would be payable to the Director's beneficiary in the event of the Director’s death.

2.) Paragraph X, Director’s Death, shall be deleted in its entirely and replaced with the following:

In the event of the death of the Director after commencement of payments but prior to the Director receiving all payments due the Director under this Agreement, the remaining account balance(1) shall be paid in a lump sum, on the first day of the second month following the death of the Director, to such individual or individuals as the Director may have designated in writing and filed with the Bank, In the event no designation is made, the Director’s account balance(1) shall be paid, in a lump sum, as set forth herein to the duly qualified executor or administrator of the Director’s estate.

This Amendment shall be effective the 31st day of December, 2006. To the extent that any term, provision, or paragraph of said Agreement is not specifically amended herein, or in any other amendment thereto, said term, provision, or paragraph shall remain in full force and effect as set forth in said January 8, 2006 Agreement.

(1) (deferrals plus credited interest)

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IN WITNESS WHEREOF, the parties hereto acknowledge that each has carefully read this Amendment and executed the original thereof on the first day set forth hereinabove, and that, upon execution, each has received a conforming copy.

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DIRECTOR DEFERRED COMPENSATION AGREEMENT

THIS AGREEMENT, made and entered into this day of , 2001, by and between The Gratz National Bank, a banking corporation incorporated under the laws of Pennsylvania (hereinafter referred to as the “Bank”), and David H. Koppenhaver (hereinafter referred to as the “Director”);

WHEREAS, the Bank and the Director wish to enter into an agreement relating to the Director’s services to the Bank upon the terms and conditions herein set forth;

NOW, THEREFORE, in consideration of the payments herein provided and of mutual agreements contained herein, the parties hereto agree as follows:

So long as the Director shall continue to be a director of the Bank, the Director shall devote the Director’s best efforts to the performance of the Director’s duties as a member of the Board of Directors and any of the Bank’s committees to which the Director is appointed.

The fees covered under this Agreement shall be any and all amounts paid to the Director for the Director’s services as a director, including, but not limited to, annual fees, meeting fees, and committee fees. In addition, the fees shall include any salary or bonus that is paid to the Director by the Bank. The fees covered under this Agreement shall be credited to the Director in the manner and on the terms and conditions specified in Paragraph IV, subject to the election requirement of Paragraph III.

The Director shall, at the same time as entering this Agreement, file a written statement with the Bank notifying the Bank as to the percent (%) or dollar amount of fees as defined in Paragraph II that is to be deferred. The election to defer fees may only be made for fees not yet earned as of the date of said election. Signed written statements filed under this section, unless modified or revoked, shall be valid for all succeeding years. Any modification or revocation of a signed written statement must be in writing and shall be effective for one (1) calendar year succeeding the year in which the modification or revocation is made.

The Bank shall establish a bookkeeping account for the Director (hereinafter called the “Director’s Deferred Compensation Account”) which shall be credited on the dates such fees, as defined in Paragraph II, would otherwise have been paid with the percentage or dollar amount that the Director has notified the Bank in writing, pursuant to Paragraph III, that the Director elected to have deferred.

The Director’s Deferred Compensation Account shall be credited with an amount that is in addition to the fees credited under Paragraph IV. Such amount shall be determined by multiplying the balance of the Director’s Deferred Compensation Account by a rate of interest equal to one hundred fifty percent (150%) of the average one year Treasury instrument for the plan year as quoted in the Wall Street Journal. Such rate shall be adjusted annually. Such amount shall be credited as long as

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there is a balance in the Director’s Deferred Compensation Account and shall be credited on December 31st of each year.

The Director’s Deferred Compensation Account shall be utilized solely as a device for the measurement and determination of the amount of deferred compensation to be paid to the Director at the times hereinafter specified and the Bank shall not segregate any of its assets in order to satisfy any obligations under this Agreement. The Director’s Deferred Compensation Account shall not constitute or be treated as a trust fund of any kind. On the contrary, it is understood that all amounts credited to the Director’s Deferred Compensation Account shall be for the sole purpose of bookkeeping and remain the sole property of the Bank, and that the Director shall have no ownership rights of any nature with respect thereto. The Director’s rights are limited to the rights to receive payments as hereinafter provided, and the Director’s position with respect thereto is that of a general unsecured creditor of the Bank.

The amounts in the Director’s Deferred Compensation Account shall be paid in equal monthly installments for one hundred and twenty (120) months. The amount payable shall be the balance of the Director’s Deferred Compensation Account as defined in Paragraph IV, including all interest credited pursuant to Paragraph V.

Installment payments of deferred amounts shall commence on the first day of the calendar month following the end of the Director’s term of office due to resignation, removal, failure to be re-elected, or the Director’s sixty-fifth (65th) birthday or five (5) years from October 26, 2001, whichever is later.

In the event of the death of the Director prior to termination of service or commencement of payments, payments shall commence under this Paragraph within thirty (30) days after the Director’s death and shall be made to a beneficiary or beneficiaries designated by the Director in writing and delivered to the Bank’s president. The Director shall have the right to change the designated beneficiary from time to time. In the event no designation is made, the Director’s account balance1 shall be paid, in a lump sum, to the Director’s estate. The amount of the payments to be made under this Paragraph shall be calculated as if the Director had survived to the later of five (5) years from October 26, 2001 or age sixty-five (65) and continued the dollar amount of deferrals made in the calendar year prior to the Director’s date of death until that time with an annual interest crediting rate equal to the rate applicable to the Plan Year prior to the Director’s date of death. The Bank shall annually calculate the amount payable pursuant to this Paragraph and advise the Director no later than June 30th the amount that would be payable to the Director's beneficiary in the event of the Director’s death.

1 Deferrals plus credited interest

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In the event of the death of the Director after commencement of payments but prior to the Director receiving all payments due the Director under this Agreement, the remaining payments shall be paid to a beneficiary or beneficiaries designed by the Director in writing and delivered to the Bank’s president. The Director shall have the right to change the Director’s designated beneficiary from time to time. In the event no designation is made, the Director’s account balance1 shall be paid, in a lump sum to the Director’s estate. The lump sum payment under this Paragraph shall be made within thirty (30) days after the Director’s death.

The Bank’s obligations under this Agreement shall be an unfunded and unsecured promise to pay. The Bank shall not be obligated under any circumstances to fund its obligations, the Bank may, however, at its sole and exclusive option, elect to fund this Agreement in whole or in part.

Should the Bank elect to fund this Agreement informally, in whole or in part, the manner of such informal funding, and the continuance or discontinuance of such informal funding shall be the sole and exclusive decision of the Bank.

Should the Bank determine to informally fund this Agreement, in whole or in part, through the medium of life insurance or annuities, or both, the Bank shall be the owner and beneficiary of the policy. The Bank reserves the absolute right to terminate such life insurance or annuities, as well as any other funding at any time, either in whole or in part.

Any such life insurance or annuity policy purchased by the Bank shall not in any way by considered to be security for the performance of the obligations for this Agreement. It shall be, and remain, a general, unpledged, unrestricted asset of the Bank and the Director shall have no interest in such policy whatsoever.

The Director hereby agrees to submit to medical examination, supply such information, and execute such documents as may be required by the insurance company or companies to whom the Bank may have applied for such insurance.

Nothing contained in this Agreement shall affect the right of the Director to participate in or be covered by any qualified or non-qualified pension, profit-sharing, group, bonus or other supplemental compensation or fringe benefit plans constituting a part of the Bank’s existing or future compensation structure.

The Director’s Deferred Compensation Account and any payment payable at any time to this Agreement shall not be assignable or subject to pledge or hypothecation nor shall said payments be subject to seizure for the payment of any debts, judgments, alimony or separate maintenance, or be transferable by operation of law in the event of bankruptcy, insolvency or otherwise except to the extent as provided by law.

1 Deferrals plus credited interest

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Neither this Agreement nor the payments of any benefits there under shall be construed as giving to the Director any right to be retained as a member of the Board of Directors of the Bank.

The Named Fiduciary of this Agreement for purposes of claim procedures under this Agreement is the President of the Bank. The business address and telephone number of the Named Fiduciary under this Agreement is as follows:

Theodore R. Bonwit, Jr.

The Gratz National Bank

Market Street

Gratz, Pennsylvania 17030

(717) 365-3181

The Bank shall have the right to change the Named Fiduciary under this Agreement at any time. The Bank shall give the Director written notice of any change of the Named Fiduciary, address or telephone number.

In the event that benefits under this Agreement are not paid to the Director (or to the Director’s beneficiary(ies) in the case of the Director’s death) and such claimants feel they are entitled to receive such benefits, then a written claim must be made to the Named Fiduciary named above within sixty (60) days from the date payments are refused. The Named Fiduciary and the Bank shall review the written claim and if the claim is denied, in whole or in part, they shall provide in writing within ninety (90) days of receipt of such claim provisions of this Agreement upon which the denial is based and any additional material or information necessary to perfect the claim. Such written notice shall further indicate the additional steps to be taken by claimants if a further review of the claim denial is desired. A claim shall be deemed denied if the Named Fiduciary fails to take any action within the aforesaid ninety (90) day period.

If claimants desire a second review, they shall notify the Named Fiduciary in writing within sixty (60) days of the first claim denial. Claimants may review this Agreement or any other documents relating thereto and submit any written issues and comments they may feel appropriate. In its sole discretion, the Named Fiduciary shall then review the second claim and provide a written decision within sixty (60) days of receipt of such claim. This decision shall likewise state the specific reasons for the decision and shall include reference to specific provisions of this Agreement upon which the decision is based.

If claimants continue to dispute the benefit denial based upon completed performance of this Agreement or the meaning and effect of the terms and conditions thereof, then claimants may submit the dispute to a Board of Arbitration for final arbitration. Said Board shall consist of one member selected by the claimant, one member selected by the Bank, and one member selected by the first two members. The Board shall operate under any generally recognized set of arbitration rules. The parties hereto agree that they and their heirs, personal representatives, successors and assigns shall be bound by the decision of such Board with respect to any controversy properly submitted to it for determination.

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Any provisions of this Agreement found to be invalid shall be severable and the remainder of this Agreement shall remain effective.

This Agreement shall be construed and interpreted in accordance with the laws of the State of Pennsylvania.

The rights of either party under this Agreement may not be transferred or assigned in any fashion or manner whatsoever.

The bank is entering into this Agreement upon the assumption that certain existing tax laws will continue in effect in their current form. If there are any changes in Federal law affecting the tax-free accumulation of earnings within a life insurance policy, the income tax-free payment of proceeds from life insurance policies or the deduction from income or interest payments on certificates of deposit issued by banking institutions, the Bank shall have the option to terminate and modify this Agreement. Provided, however, that the Director shall be entitled to receive at least the Director’s Deferred Compensation Account including interest earned.

This Agreement contains the entire understanding between the parties and supersedes all prior agreements and understanding between the parties with respect to matters set forth in this Agreement. Any additions or modifications to this Agreement must be in writing and signed by the parties.

Headings and subheadings in this Agreement are inserted for reference and convenience only and shall not be deemed a part of this Agreement.

This Agreement shall be binding upon the parties hereto, their legal representatives, successors and assigns.

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IN WITNESS WHEREOF, the parties hereto acknowledge that each has carefully read this Agreement and executed the original thereof on the first day set forth hereinabove and that, upon execution, each has received a conforming copy.

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