CHANGE IN CONTROL AGREEMENT
Exhibit
10
CHANGE IN CONTROL AGREEMENT
(this "Agreement") made as of this 22nd day of April, 2009, by and among SUSSEX BANK, a state chartered
bank with its principal place of business located at 000 Xxxxx Xxxxxxx 00,
Xxxxxxxx, Xxx Xxxxxx 00000 (the "Bank"), SUSSEX BANCORP, a New Jersey
corporation with its principal place of business located at 000 Xxxxxxxxxxx
Xxxx, Xxxxxxxx, Xxx Xxxxxx 00000 (the "Company"; the Bank and the Company
sometimes collectively are referred to herein as "Employer"), and XXXXXXX XXXXXXX, an individual
residing at 00 Xxxxxxxx Xxxx, Xxxxxxx, Xxx Xxxxxx 00000 (the
"Executive").
W I T N E S S E T H:
WHEREAS, Executive is
presently employed by the Employer as an Executive Vice President and Chief
Financial Officer of the Bank and the Company; and
WHEREAS, Employer wishes to
ensure that it will continue to retain Executive in its employ and to receive
Executive's undivided effort and attention.
NOW, THEREFORE, in
consideration of the mutual promises and undertakings herein contained, the
parties hereto, intending to be legally bound, agree as follows:
1. 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
below, or, as provided below the voluntary termination of the Executive within
twelve (12) months of such Change in Control for “Good reason”, Executive shall
become entitled to receive the payments provided for under paragraph (c)
below. Upon the occurrence of a Change in Control, the Executive
shall have the right to elect to voluntarily terminate her employment within
twelve (12) months of such Change in Control following any demotion, loss of
title, office of significantly authority, reduction in her annual compensation
or benefits, or relocation of her principal place of employment by more than
thirty miles from its location immediately prior to the Change in Control, all
of which shall be deemed “Good Reason” for such voluntary termination by
Executive.
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(b)
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A
"Change in Control" shall mean:
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(i)
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a
reorganization, merger, consolidation or sale of all or substantially all
of the assets of the Company, or a similar transaction in which the
shareholders of the Company prior to such transaction hold less than a
majority of the voting power of the resulting entity;
or
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(ii)
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individuals
who constitute the Incumbent Board (as herein defined) of the Company
cease for any reason to constitute a majority thereof;
or
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(iii)
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an
event of a nature that would be required to be reported in response to
Item 5.01 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
0000 (xxx "Xxxxxxxx Xxx"); or
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(iv)
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any
"person" (as the term is used in Section 13(d) and 14(d) of the Exchange
Act) other than the Company or the trustees or any administrator of any
employee stock ownership plan and trust, or any other employee benefit
plans established by Employer from time-to-time, is or becomes a
"beneficial owner" (as defined in Rule 13-d under the Exchange Act),
directly or indirectly, of securities of the Company representing 25% or
more of the Company's outstanding securities ordinarily having the right
to vote at the election of directors;
or
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(v)
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a
proxy statement soliciting proxies from stockholders of the Company is
disseminated by someone other than the current management of the Company
seeking stockholder approval of a plan of reorganization, merger or
consolidation of the Company 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 the Company;
or
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(vi)
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a
tender offer is made for 25% or more of the voting securities of the
Company and shareholders owning beneficially or of record 25% or more of
the outstanding securities of the Company have tendered or offered to sell
their shares pursuant to such tender and such tendered shares have been
accepted by the tender offeror.
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For these
purposes, "Incumbent Board" means the Board of Directors on the date hereof,
provided that any person becoming a director subsequent to the date hereof whose
election was approved by a voting 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 Section 1(a) above are satisfied, Executive shall be
entitled to receive a lump sum payment equal to two (2) times Executive’s then
current base salary; provided, however, that in no event shall any payments
provided for hereunder constitute an “excess parachute payment" under Section
280G of the Internal Revenue Code of 1986, as amended or any successor thereto,
and in order to avoid such a result the benefits provided for hereunder will be
reduced, if necessary, to an amount which is One Dollar ($1.00) less than an
amount equal to three (3) times Executive's "base amount" as determined in
accordance with such Section 280G. In addition to the foregoing,
Executive shall be entitled to receive from Employer, or its successor,
hospital, health, medical and life insurance on the terms and at
the
cost to
Executive as Executive was receiving such benefits upon the date of her
termination. Employer's obligation to continue such insurance
benefits will be for a period of two (2) years.
(d) As
used in this Agreement, the term "Cause" shall mean the Executive's personal
dishonesty, willful misconduct, breach of fiduciary duty involving personal
profit, intentional failure to perform stated duties, willful violation of any
law, rule or regulation (other than traffic violations or similar offenses) or
final cease-and-desist order, or a material breach of any provision of this
Agreement. Notwithstanding the above, the Executive shall not be
deemed to have been terminated for cause unless and until there shall have been
delivered to her a copy of a resolution duly adopted by the affirmative vote of
not less than three-quarters of the members of the Board of Directors of the
Company at a meeting of its Board called and held for that purpose (after
reasonable notice to the Executive and an opportunity for her, together with
counsel, to be heard before such Board of Directors), finding that in the good
faith opinion of the Board of Directors, the Executive was guilty of conduct
justifying termination for cause and specifying the particulars thereof in
detail.
2. No Guaranty of
Employment. Nothing in this Agreement shall be construed as guarantying
the employment of the Executive. Executive shall remain an "employee at will" of
Employer at all times during the term of this Agreement.
3. Notices.
(a) Any and all notices, demands or requests required or permitted to
be given under this Agreement shall be given in writing and sent (i) by
registered or certified U.S. mail, return receipt requested, (ii) by hand, (iii)
by overnight courier or (iv) by telecopier addressed to the parties hereto at
their addresses set forth above or such other addresses as they may from
time-to-time designate by written notice, given in accordance with the terms of
this Section.
(b) Notice
given as provided in this Section shall be deemed effective: (i) on the date
hand delivered, (ii) on the first business day following the sending thereof by
overnight courier, (iii) on the seventh calendar day (or, if it is not a
business day, then the next succeeding business day thereafter) after the
depositing thereof into the exclusive custody of the U.S. Postal Service or (iv)
on the date telecopied.
4. Term. This Agreement
shall have a term of two (2) years from the date hereof; provided, however, that
in the event the term of this Agreement would terminate at any time after the
Employer has engaged in substantive negotiations regarding a transaction which
would lead to a Change in Control if consummated, this Agreement shall continue
to remain in full force in effect until the earlier to occur of (i) the
effectuation of such transaction leading to a Change in Control or (ii) the
termination of the negotiations for the proposed transaction which would have
resulted in the Change in Control.
5. Assignability.
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, Employer and its successors
and assigns. This Agreement shall inure to the benefit of the Executive's heirs,
executors, administrators and other legal representatives.
6.
Waiver. The waiver by
Employer 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.
7.
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.
8.
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.
9.
Counterparts.
This Agreement may be executed in two or more counterparts, each of which shall
be deemed an original but all of which taken together shall constitute one and
the same instrument.
10. Amendment. This
Agreement may be modified or amended only by an amendment in writing signed by
both parties.
11. Severability. If any
provision of this Agreement shall be held invalid or unenforceable, such
invalidity or unenforceability shall attach only to such provision, only to the
extent it is invalid or unenforceable, and shall not in any manner affect or
render invalid or unenforceable any other severable provision of this Agreement,
and this Agreement shall be carried out as if any such invalid or unenforceable
provision were not contained herein.
12. Section Headings. The
headings contained in this Agreement are solely for convenience of reference and
shall be given no effect in the construction or interpretation of this
Agreement.
13. Fees and Expenses. If
any party to this Agreement institutes any action or proceeding to enforce this
Agreement, the prevailing party in such action or proceeding shall be entitled
to recover from the non-prevailing party all legal costs and expenses incurred
by the prevailing party in such action, including, but not limited to,
reasonable attorney's fees and other reasonable legal costs and
expenses.
IN WITNESS WHEREOF, the
parties hereto have executed this Agreement under their respective hands as of
the day and year first above written.
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SUSSEX
BANK
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By:
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/s/
Xxxxxx X. Xxxxxx
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Xxxxxx
X. Xxxxxx
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Chairman
of the Board
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By:
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/s/
Xxxxxx X. Xxxxxx
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Xxxxxx
X. Xxxxxx,
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President
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EXECUTIVE
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/s/
Xxxxxxx Xxxxxxx
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Xxxxxxx
Xxxxxxx,
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Executive
Vice President and
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Chief
Financial Officer
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