Exhibit 10.1
EMPLOYMENT AGREEMENT
Employment Agreement (the
"Employment Agreement") made as of this 15th day
of July, 2009, by and between DONALD L. KOVACH ,
an individual residing at Branchville, New Jersey (the "Employee"),
SUSSEX BANK , a state chartered bank with its principal
place of business located at 200 Munsonhurst Road, Route 517,
Franklin, New Jersey 07416 (the "Bank"), and SUSSEX BANCORP
, a New Jersey corporation with its principal place of business
located at Route 517, Franklin, New Jersey 07416 (the "Company";
the Bank and the company sometimes collectively are referred to
herein as "Employer").
WHEREAS , the Board of Directors of the Bank and the
Board of Directors of the Company have each determined that it is
in the best interests of each of the Bank and the Company to enter
into this Agreement with Employee, and each respective Board has
authorized the Bank and the Company to enter into this
Agreement;
WHEREAS , the Employee agrees to be employed pursuant to
the terms and conditions of this Agreement;
NOW, THEREFORE
, in consideration of the premises
and covenants contained herein, and with the intent to be legally
bound hereby, the parties hereto hereby agree as
follows:
1.
Employment . The Company and the Bank hereby
jointly agree to employ the Employee, and the Employee hereby
accepts such employment, upon the terms and conditions set forth
herein.
2.
Position and Duties .
(a) Subject to the terms of
paragraph (b) below, the Employee shall be employed as Chairman,
President and Chief Executive Officer of the Company and Chairman
and Chief Executive Officer of the Bank, to perform such services
in that capacity as are usual and customary for comparable
institutions and as shall from time-to-time be established by the
Board of Directors of the Company and the Bank. Employee
agrees that he will devote his full business time and efforts to
his duties hereunder.
(b) Notwithstanding the provisions
of paragraph (a) hereof, either the Employer or the Employee may
elect, in the discretion of either and without cause, to have
Employee relinquish
the titles and positions granted under paragraph
(a) hereof other than those of Chairman of the Board of the Company
and the Bank, by providing thirty (30) days written notice to the
other party. Any such decision shall not be deemed a breach or
termination of this Agreement, which shall remain in full force and
effect, or as a termination of Employee under Section 6
hereof.
3.
Cash Compensation . Employer shall pay to the
Employee compensation for his services as follows:
(a)
Base Salary . The Employee shall be entitled to
receive, commencing upon the date of this Agreement, an annual base
salary (the "Base Salary") of Two Hundred Sixty Six and Two Hundred
Ninety Two Dollars ($266,292), which shall be payable in
installments in accordance with Employer's usual payroll
method. Annually thereafter, on or prior to the
anniversary date of this Agreement, the Board of Directors shall
review the Employee's performance, the status of Employer and such
other factors as the Board of Directors or a committee thereof
shall deem appropriate and shall adjust the Base Salary
accordingly. Notwithstanding the forgoing, in the event Employer or
Employee exercises the right provided under Section 2(b) hereof for
the Employee to cease serving in all positions other than Chairman
of the Board of the Company and the Bank, the Base Salary shall,
effective as of the effective date of the change in
Employee’s positions, be reduced to fifty percent (50%) of
the Base Salary on the date the written notice required by Section
2(b) is given.
(b)
Discretionary Bonus . Employee shall be entitled
to receive annually at the discretion of the Board of Directors or
a committee thereof a cash bonus.
4.
Other Benefits.
(a)
Fringe Benefits . The Employee shall be entitled
to the exclusive and unlimited use of an automobile or a cash
allowance to be used for the purpose of maintaining an automobile
of a type and style commensurate with the Employee's status with
Employer. In addition, the Employee shall be entitled to
receive hospital, health, medical, and life insurance of a type
currently provided to and enjoyed by other senior officers of
Employer, and shall be entitled to participate in any other
employee benefit or retirement plans offered by Employer to its
employees generally or to its senior management.
5.
Term . The term of this Agreement shall be three
years, commencing on the date hereof and continuing
until August 31, 2012.
6.
Termination . Employee may be terminated at any
time, without prejudice to Employee's right to compensation or
benefits as provided herein. Employee's rights
upon a termination shall be as follows:
(a)
Cause . As used in this Agreement, the term
"Cause" shall mean the Employee'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 Employee shall
not be deemed to have been terminated for cause unless and until
there shall have been delivered to him a copy of a resolution duly
adopted by the affirmative vote of not less than three-fourths of
the members of the Board of Directors of each of the Company and
the Bank at meetings of their respective Boards called and held for
that purpose (after reasonable notice to the Employee and an
opportunity for him, together with counsel, to be heard before each
such Board of Directors), finding that in the good faith opinion of
the Board of Directors, the Employee was guilty of conduct
justifying termination for cause and specifying the particulars
thereof in detail; provided, however, that nothing contained herein
shall prohibit Employee from being suspended from his duties
hereunder by a duly authorized agent of the Board upon a good faith
determination that "cause" exists. Such suspension shall
last until such time as the Board meeting provided for above shall
have occurred, provided that such Board meeting shall occur within
a reasonable period of time. During such suspension
Employee shall continue to be an employee, entitled to all salary
and benefits provided for hereunder.
(b)
Termination With Cause . Employer shall have the
right to terminate the Employee for "cause", upon written notice to
him of such determination, specifying the alleged
"cause". In the event of such termination, the Employee
shall not be entitled to any further benefits under this
Agreement.
(c)
Termination Without Cause . Upon a
termination of Employee's employment hereunder without "cause", in
recognition of such termination and Employee
