EMPLOYMENT AGREEMENT
AGREEMENT made this _______ day of __________________, 199_ between
CARNEGIE BANCORP, a New Jersey corporation having its principal place of
business at 000 Xxxxxxxxx Xxxx, Xxxxxxxxx, Xxx Xxxxxx 00000 ("Carnegie") and
Xxxxxx Xxxxxx, an individual residing at 00000 Xxxx Xxxxxxxxx Xxxxx, Xxxxxxx,
Xxxxxxx 00000 (the "Executive").
W I T N E S S E T H:
WHEREAS, Carnegie deems it to be in its best interests to secure and
retain the services of the Executive and the Executive desires to work for
Carnegie upon the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual promises and
undertakings herein contained, the parties hereto, intending to be legally bound
hereby, agree as follows:
1. Employment and Term.
(a) Carnegie hereby employs the Executive as Vice Chairman of
Carnegie and as President and Chief Executive Officer of the Regent Division
("Regent") of Carnegie Regent Bank, N.A. (collectively, the "Position") and the
Executive agrees to serve in the employ of Carnegie in the Position, for a term
of three years (the "Initial Term"), which shall commence on the date hereof
(the "Effective Date"), and which, subject to paragraphs 1(b) and 1(c) hereof,
shall terminate on the third anniversary of the Effective Date.
(b) Unless written notice terminating the term of employment
is given by either Carnegie or the Executive not less than 90 days prior to the
end of the Initial Term or any renewal term, this Agreement shall be
automatically extended, on all of the terms and conditions hereof, for
successive periods of one year.
(c) Carnegie shall have the right to terminate the Executive's
employment hereunder prior to the third anniversary of the Effective Date, but
only for cause. For purposes of this Agreement, "cause" means (i) the
Executive's willful and continued failure substantially to perform the duties of
his Position with Carnegie or Regent, (ii) fraud, misappropriation or other
intentional material damage to the property or business of Carnegie or Regent,
(iii) the Executive's admission or conviction of, or plea of nolo contendere to,
any felony that, in the judgment of the Board of Directors of Carnegie (the
"Board"), adversely affects Carnegie's reputation or the Executive's ability to
perform his duties hereunder; or (iv) the Executive's willful violation of any
law, rule or regulation (other than traffic violations or similar offenses) or
final cease-and-desist order issued by or regulatory consent agreement with any
banking regulatory agency having jurisdiction over Carnegie or its subsidiaries.
(d) The Executive shall have the right to terminate his employment
hereunder at any time prior to the third anniversary of the Effective Date, upon
giving sixty (60) days' prior written notification to Carnegie.
2. Duties.
(a) Subject to the ultimate control and discretion of the
Board, the Executive shall serve in the Position and perform all duties and
services of an executive nature commensurate to the Position which the Board may
from time to time reasonably assign to the Executive. Except for travel normally
incidental and reasonably necessary to the business of Carnegie, the duties of
the Executive shall be performed in the Philadelphia, Pennsylvania office of
Regent and the West Windsor, New Jersey office of Carnegie or in Jupiter,
Florida. Carnegie acknowledges that the Executive resides in Jupiter, Florida,
and Carnegie agrees that the Executive shall be present at Regent's
Philadelphia, Pennsylvania offices or Carnegie's West Windsor, New Jersey
offices no more frequently than every other week except during vacation periods.
While in Florida, the Executive shall be available for consultation by fax and
telephone.
(b) The Executive shall, consistent with his position as
President and Chief Executive Officer of Regent and Vice Chairman of Carnegie,
be responsible for the management of Regent, its organizational structure and
its personnel, subject to the authority of the Board and the Chief Executive
Officer of Carnegie.
(c) The Executive shall devote all of the Executive's time and
attention during regular business hours to the performance of the Executive's
duties hereunder and, during the term of the Executive's employment hereunder,
shall not engage in any other business enterprise which requires more than five
hours per week of the Executive's personal time or attention, unless granted the
prior permission of the Board. The foregoing shall not prevent the Executive's
purchase, ownership or sale of investment securities or of any interest in, any
business which competes with the business of Carnegie or the Executive's
involvement in charitable or community activities, provided that the time and
attention which the Executive devotes to such business and activities does not
materially interfere with the performance of the Executive's duties hereunder.
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3. Compensation.
(a) For all services to be rendered by the Executive under
this Agreement, Carnegie agrees to pay the Executive a salary of not less than
$125,000 per annum during the term of this Agreement ("Base Compensation"),
payable in accordance with Carnegie's normal payroll practices as in effect
from time to time, plus an annual bonus (the "Bonus") equal to not less than
1.2% of the net after tax income of Carnegie calculated before the Executive's
and other executive additional compensation is deducted and before any dividends
or other bonuses are deducted,
plus such other additional compensation as may be awarded from time to time
to the Executive by the Board.
(b) The Executive, in his capacity as a Director of Carnegie,
shall receive a fee of $750 for each Directors meeting and an additional fee of
$300 for each Committee meeting attended. Said amount shall be increased in the
event the Board increases the per meeting compensation of members of the Board.
(c) The compensation provided for in paragraph 3(a) hereby
shall be in addition to such rights as the Executive may have, during the
Executive's service hereunder or thereafter, to participate in and receive
benefits from or under any bonus, stock option, pension, profit-sharing,
insurance or other employee benefit plan or plans of Carnegie which may exist
now or hereafter (collectively, the "Plans").
(d) During the term of the Executive's employment hereunder
and for a period of two years after the termination of such employment (unless
such termination is by Executive pursuant to paragraph 1(d) hereof or by
Carnegie pursuant to paragraph 1(c)(ii), (iii) and (iv) hereof), Carnegie agrees
to provide the Executive and his spouse, or reimburse the Executive and his
spouse for the cost of, (i) the medical and dental insurance benefits in which
the Executive and his spouse participated immediately prior to the Effective
Date or (ii) equivalent or better benefits.
(e) If Carnegie terminates the Executive's employment
hereunder, other than in accordance with paragraph 1(c) hereof, prior to the
expiration of the Initial Term, Carnegie shall continue to pay the Executive the
Base Compensation and Bonus provided in paragraph 3(a) hereof, in accordance
with Carnegie's normal payroll practices in effect from time to time, and
maintain or pay for the medical and dental insurance benefits provided in
paragraph 3(d) hereof, for the remainder of the Initial Term.
(f) Carnegie agrees to provide medical and dental insurance
benefits for the Executive's daughter, Xxxxx Xxxxxx, in which she participated
immediately prior to the Effective Time. The Executive agrees to reimburse
Carnegie for all costs associated with providing the benefits set forth in this
paragraph 3(f).
4. Vacations. The Executive shall be entitled each year to
such vacation time as he shall reasonably determine may be taken without
detriment to Carnegie, but in no event less than four weeks, during which
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vacation the Executive shall continue to receive compensation as provided in
paragraph 3 hereof. Each vacation shall be taken by Executive at such time or
times as the Executive reasonably determines, taking into account the
Executive's duties as set forth in Section 2 hereof and Carnegie's business
needs at any particular time.
5. Expenses. Carnegie shall promptly reimburse the Executive for all
reasonable expenses paid or incurred by the Executive in connection with his
employment hereunder upon presentation of expense vouchers or appropriate
documentation therefor reasonably requested by Carnegie, including, but not
limited to, all of the Executive's dues and expenses, assessments and charges
with respect to The Locust Club and the Xxxxxx Square Club.
6. Death. If the Executive dies during the Initial Term of this
Agreement, this Agreement shall terminate and Carnegie's sole obligation
hereunder shall be to pay to the Executive's spouse, if such spouse survives the
Executive, or if not, to the Executive's issue in equal amounts, or if none
survive, to his Estate, (a) any accrued but unpaid compensation due the
Executive pursuant to paragraph 3 hereof to the date of the Executive's death
and (b) the Base Compensation and Bonus which would otherwise be payable to
Executive through the end of the 12-month period following the date of the
Executive's death. Such Base Compensation and Bonus shall be paid in accordance
with Carnegie's normal payroll practices as in effect from time to time.
7. Indemnification. Carnegie shall indemnify the Executive, to the
fullest extent permitted by law, for any and all liabilities to which the
Executive may be subject as a result of, in connection with or arising out of
his employment by Carnegie hereunder, as well as the costs and expenses
(including attorneys' fees) of any legal action brought or threatened to be
brought against the Executive or Carnegie as a result of, in connection with or
arising out of such employment. The Executive shall be entitled to the full
protection of any insurance polices which Carnegie may elect to maintain
generally for the benefit of its directors and officers.
8. Change in Control.
(a) Upon the occurrence of a Change in Control (as herein
defined) followed at any time during the term of this Agreement by the
involuntary termination of the Executive's employment other than for "cause", as
defined in paragraph 1(c) hereof, or, as provided below, the voluntary
termination of his employment by Executive within 18 months of such Change in
Control, the Executive shall be entitled to the benefits provided under
paragraph 8(c). Upon the occurrence of a Change in Control, the Executive shall
have the right to elect to voluntarily terminate his employment within 18 months
of such Change in Control following any demotion, loss of title, office or
significant authority, reduction in his annual compensation or
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benefits, or relocation of his principal place of employment by more than thirty
miles from its location immediately prior to the Change in Control.
(b) A "Change in Control" shall mean:
(i) a reorganization, merger, consolidation
or sale of all or substantially all of the assets
of Carnegie, or a similar transaction in which
Carnegie is not the resulting entity and which is
not approved by a majority of the Incumbent Board
(as herein defined);
(ii) individuals who constitute the
Incumbent Board of Carnegie cease for
any reason to constitute a majority thereof;
(iii) the acquisition by any party or group
acting in concert of control of Carnegie, within
the meaning of 12 C.F.R. ss. 225.2(d)(2), as
determined by the Incumbent Board; provided,
however, that a change in control shall not be
deemed to occur if the transaction(s) constituting
a change in control is approved by a majority of
the Incumbent Board;
(iv) an event of a nature that would be
required to be reported in response to Item I of
the current report on Form 8-K, as in effect on the
date hereof, pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 (the "Exchange
Act").
(v) Without limitation, a change in control
shall be deemed to have occurred at such time as
(i) any "person" (as the term is used in Section
13(d) and 14(d) of the Exchange Act) is or becomes
a "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act) directly or indirectly, of
securities of Carnegie representing 25 percent or
more of Carnegie's outstanding securities
ordinarily having the right to vote for the
election of directors, excluding any securities
purchased by any employee benefit plans established
by Carnegie from time to time in determining
whether such person is the beneficial owner of more
than 25 percent of Carnegie's securities; or
(vi) A proxy statement soliciting proxies
from stockholders of Carnegie is disseminated by
someone other than the current management of
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Carnegie, seeking stockholder approval of a plan of
reorganization, merger or consolidation of Carnegie
or similar transaction with one or more
corporations as a result of which the outstanding
shares of the class of securities then subject to
the plan or transaction are exchanged or converted
into cash or property or securities not issued by
Carnegie;
(vii) A tender offer is made for 25 percent
or more of the voting securities of Carnegie and
the stockholders owning beneficially or of record
25 percent or more of the outstanding securities of
Carnegie have tendered or offered to sell their
shares pursuant to such tender offer and such
tendered shares have been accepted by the tender
offeror.
For these purposes, "Incumbent Board" means the Board of
Directors of Carnegie on the Effective Date, provided that any person becoming a
director of Carnegie subsequent to the Effective Date whose election was
approved by a vote of at least three-quarters of the directors comprising the
Incumbent Board, or whose nomination for election by members or stockholders was
approved by the same nominating committee serving under an Incumbent Board,
shall be considered as though he were a member of the Incumbent Board.
(c) In the event the conditions of paragraph (a) above are
met, the Executive shall be entitled to receive the Base Compensation and Bonus
which would otherwise have been payable to the Executive through the end of the
30-month period after such termination. Such payments will be made in accordance
with Carnegie's normal payroll practices in effect at the time the Executive's
termination. In addition, Carnegie shall continue to provide the Executive with
hospital, health, medical and life insurance, and any other benefits in effect
at the time of such termination through the end of such period. The Executive
shall have no duty to mitigate damages in connection with his termination by
Carnegie or its successor without cause. However, in the event the Executive
obtains new employment and such new employment provides for hospital, health,
medical and life insurance, and other benefits, in a manner substantially
similar to the benefits payable by Carnegie to the Executive upon the date of
such termination, Carnegie may permanently terminate the duplicative benefits it
is obligated to provide hereunder.
9. Additional Covenants.
(a) Confidential Information. Except as required in
the performance of his duties hereunder, the Executive shall not
use or disclose any Confidential Information (as hereinafter
defined) or any know-how or experience related thereto without
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the express prior written authorization of Carnegie. Upon termination of his
employment, the Executive shall leave with Carnegie all documents and other
items in his possession which contain Confidential Information. For purposes of
this paragraph 9(a), the term "Confidential Information" shall mean all
information about Carnegie or relating to any of its services or any phase of
its operations not generally known to any of its competitors with which the
Executive becomes acquainted during the term of his employment.
(b) Specific Performance. Carnegie and the Executive agree
that irreparable damage would occur in the event that the provisions of
paragraph 9(a) hereof were not performed in accordance with their specific terms
or were otherwise breached. Carnegie and the Executive accordingly agree that
Carnegie shall be entitled to an injunction or injunctions to prevent a breach
of paragraph 9(a) hereof and to enforce specifically the terms and provisions of
paragraph 9(a) hereof in addition to any other remedy to which Carnegie is
entitled at law or in equity.
10. Notices. Any notice required or permitted to be given
under this Agreement shall be sufficient, if in writing and if
sent by registered or certified mail to either party hereto at
their respective addresses set forth above. All notices shall be
deemed given when mailed.
11. Assignability. The services of the Executive hereunder are personal
in nature, and neither this Agreement nor the rights or obligations of Executive
hereunder may be assigned, whether by operation of law or otherwise. This
Agreement shall be binding upon, and inure to the benefit of, Carnegie and its
permitted successors and assigns hereunder. This Agreement shall inure to the
benefit of the Executive's heirs, executors, administrators and other legal
representatives.
12. Waiver. The waiver by Carnegie or the Executive of a
breach of any provision of this Agreement by the other shall not
operate or be construed as a waiver of any subsequent or other
breach hereof.
13. Applicable Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of New
Jersey without giving effect to principles of conflict of laws.
14. Entire Agreement. This Agreement contains the entire
agreement of the parties hereto with respect to the subject
matter hereof and may not be amended, waived, changed, modified
or discharged, except by an agreement in writing signed by the
parties hereto.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement
under their respective hands and seals as of the day and year first above
written.
CARNEGIE BANCORP
Attest: By:
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Xxxxxx X. Xxxx, Xx.,
President and Chief
Executive Officer
Witness:
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Xxxxxx Xxxxxx
