WAIVER AGREEMENT
Exhibit
10.1
WAIVER AGREEMENT (this "Waiver"), made
as of March 25, 2009, by and between Somerset Hills Bancorp, a New Jersey
corporation with an address at 000 Xxxxxxxxxx Xxxx Xxxxxxxxxxxxx, Xxx Xxxxxx
00000 (the “Company”), and Xxxxxxx X. XxXxxxx, Xx., an individual residing at 00
Xxxxxx Xxxx Xxxx, Xxxxxxx, Xxx Xxxxxx 00000 (the "Executive").
WITNESSETH
:
WHEREAS, the Company and the Executive
have entered into that certain Employment Agreement, made as of March 8, 2001
and amended thereafter (and as may hereafter be further amended, modified,
supplemented, extended, renewed, restated or replaced, the "Employment
Agreement"), which governs the terms and conditions of the Executive’s
employment with the Company;
WHEREAS, as part of the Emergency
Economic Stabilization Act of 0000 (“XXXX”), xxx Xxxxxx Xxxxxx Treasury (the
“Treasury”) adopted a program known as the Capital Purchase Program (“CPP”)
pursuant to which the Treasury has invested in United States insured depository
institutions;
WHEREAS, the Company received an
investment of $7,414,000 from the Treasury pursuant to the CPP on January 16,
2009.
WHEREAS, the terms of the CPP were
revised by the American Recovery and Reinvestment Act of 2009 (the “ARRA”),
which, among other things, imposed certain limitations upon the compensation of
executive officers of companies which participated in the CPP;
WHEREAS, the Employment Agreement does
not comply with the requirements of ARRA, in that it provides for certain
severance payments and a cash bonus to the Executive; and
WHEREAS,
the Executive is willing to waive such portions of the Employment Agreement
which do not comply with the ARRA subject to the terms and conditions contained
herein
NOW THEREFORE, in
consideration of the foregoing, and the respective agreements and covenants
contained herein, the parties hereto agree as follows:
1. Waiver
Subject to the terms and conditions
hereof, the Executive hereby agrees to waive all provisions of the Employment
Agreement which would render the Company in violation of the Section 111 of the
EESA, as amended by the ARRA, and the regulations that may be promulgated
thereunder from time to time, including, but not limited to:
a. Article
3.1 of the Employment Agreement with respect to the right of the Executive to
receive an annual cash bonus in an amount to be determined at the discretion of
the Company’s Board of Directors, not less than twenty five thousand ($25,000)
dollars;
b. Article
4.4(a) of the Employment Agreement with respect to the Executive’s estate’s
right to receive payments upon Executive’s death;
c. Any
right to post-employment compensation under Article 7 of the Employment
Agreement, regardless of whether such right arises as a result of a termination
by the Employer, a termination for Good reason by the Employee or a termination
subsequent to a Change in Control by either Employer or Employee;
provided, however, that
the foregoing waiver will be of no
further force or effect, and the Executive will be
entitled to exercise all of his
rights
and remedies under the Employment
Agreement, and applicable law, automatically upon such time as the
Company is no longer prohibited from making the payments described above under
the EESA and regulations thereunder, whether because the Company’s obligation to
the Treasury arising from the Company’s participation in the CPP shall be
satisfied or excused, the EESA shall be further amended to eliminate the
prohibition on severance or otherwise.
2. Further Limitations of
Waiver
This Waiver by the Executive of the
benefits conferred to him pursuant to the Employment Agreement shall be
construed only to the minimum extent necessary so that the Company shall be in
compliance with the Section 111 of the EESA, the ARRA and the regulations as may
be promulgated from time to time thereunder (collectively, the “Acts”), and
shall not be construed to grant to the Company additional benefits beyond what
is minimally required to comply with the Acts.
3 Entire
Agreement; Binding Affect; Employment Agreement to Remain in
Effect. This Waiver constitutes the entire and final agreement
among the parties with respect to the subject matter hereof and there are no
agreements, understandings, warranties or representations among the parties as
to such subject matter except as set forth herein. This Waiver will
inure to the benefit and bind the parties hereto and the respective heirs,
administrators, executors, representatives, successors and permitted assigns of
the parties hereto. Except as specifically provided for hereunder, the
Employment Agreement shall remain in full force and effect, shall not be
modified or otherwise revised by this Waiver Agreement.
4. Defined
Terms. Capitalized terms used herein and not otherwise defined
shall have the meanings ascribed to them in the Employment
Agreement.
5. Governing
Law. This Waiver is executed and delivered in the State of New
Jersey and it is the desire and intention of the parties that it be in all
respects interpreted according to the laws of the State of New Jersey, without
giving effect to choice of law provisions thereof.
6. Counterparts. This
Waiver may be executed in counterparts, each of which will be deemed an original
document, but all of which will constitute a single document.
IN WITNESS WHEREOF, the
Company, the Bank and the Executive legally bound, have executed this Waiver
Agreement as of the date first noted above.
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By:
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/s/ Xxxxxx
X. Deutsch
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Name: Xxxxxx
Deutsch
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Title: Chairman
of the Board
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Somerset
Hills Bank
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By:
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/s/ Xxxxxx
X. Deutsch
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Name: Xxxxxx
Deutsch
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Title: Chairman
of the Board
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/s/
Xxxxxxx X. XxXxxxx, Xx.
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Xxxxxxx
X. XxXxxxx, Xx.
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