Exhibit 10.1
SEPARATION AND GENERAL RELEASE
AGREEMENT
This Separation and General Release
Agreement must be executed and returned to the Company in
care
of Robert Vandenbergh, Senior Executive Vice
President on or before September 26, 2008.
THIS SEPARATION AND GENERAL RELEASE
AGREEMENT (this “ Separation Agreement ”) is
entered into between STEVEN SCHACHTEL (the “ Employee
”), an individual residing at 35 West Church Road, Saddle
River, New Jersey 07458, LAKELAND BANCORP, INC. (the “
Holding Company ”), a New Jersey corporation with
headquarters at 250 Oak Ridge Road, Oak Ridge, New Jersey, and
LAKELAND BANK (the “ Bank ”), a New Jersey
chartered commercial bank, with headquarters at 250 Oak Ridge Road,
Oak Ridge, New Jersey 07438. The Holding Company and the Bank are
collectively referred to herein as the “ Company
.” The Holding Company and the Bank, together with their
respective past, present and future direct and indirect
subsidiaries, affiliated entities, related companies and divisions
and each of their respective past, present and future officers,
directors, employees, shareholders, trustees, members, partners,
plan administrators, attorneys, and agents (individually and in
their official capacities), as well as any predecessors, future
successors or assigns or estates of any of the foregoing, are
collectively referred to in this Separation Agreement as the
“ Released Parties .”
WITNESSETH THAT:
WHEREAS, Employee is currently
employed as President of the Lakeland Bank Equipment Leasing
Division;
WHEREAS, the Holding Company, the
Bank and Employee entered into a Change in Control, Severance and
Employment Agreement as of August 2, 2006 (the “
Employment Agreement ”);
WHEREAS, the Company and Employee
have mutually agreed to terminate their employment relationship
effective as of the earlier to occur of :
(a) December 31, 2008, or (b) the effective date of
Employee’s earlier resignation, and the parties hereto desire
to enter into an agreement to set forth the terms of their
respective rights and obligations relating to the termination of
the employment relationship.
NOW, THEREFORE, in consideration of
the foregoing premises, the mutual covenants and agreements
contained herein, and other good and valuable consideration the
receipt and sufficiency of which is hereby acknowledged, the
parties hereto, intending to be legally bound, hereby agree as
follows:
1. Termination of Employment
Agreement; Separation of Employment . Effective as of the close
of business on September 12, 2008, the Employment Agreement
shall be deemed terminated by mutual agreement between the Company
and Employee and shall thereafter be of no further force and effect
(except with respect to Sections 11 and 12 thereof, which shall
remain in full force and effect; provided, however, in accordance
with Section 5(A) below and subject to the terms and
conditions of this Separation Agreement, effective as of the
Separation Date (as defined below), the Company shall be deemed to
have waived Employee’s obligations under clause (ii) of
Section 12(a) of the Employment Agreement). Notwithstanding
the termination of the Employment
Agreement, Employee shall, in accordance with
Section 2 below, remain employed by the Company until
earlier to occur of : (a) December 31, 2008, or
(b) the effective date of Employee’s earlier resignation
(the “ Separation Date ”). Accordingly, Employee
understands and acknowledges that his last day of employment with
the Company will be the Separation Date. Employee understands and
agrees that, if he elects to resign prior to December 31,
2008, he shall be required to provide the Bank with at least ten
(10) days advance written notice (addressed to Robert
Vandenbergh, Senior Executive Vice President) of such resignation.
Employee further acknowledges and agrees that Employee has received
all compensation and benefits to which Employee is entitled under
the Employment Agreement or otherwise as a result of
Employee’s employment, except as otherwise specifically
provided in this Separation Agreement. Employee understands that,
except as otherwise provided in this Separation Agreement, Employee
is entitled to nothing further from the Released Parties under the
Employment Agreement or otherwise, including reinstatement by the
Company.
2. Transition Period . During
the period beginning on September 13, 2008 and ending on the
Separation Date (the “ Transition Period ”),
Employee shall not be required or permitted to perform his
customary services for the Company (except as otherwise
specifically directed by Robert Vandenbergh, Senior Executive Vice
President (or his nominee)). However, during the Transition Period,
Employee will be required to (a) be available via telephone
and/or e-mail, during regular business hours, to respond to
inquiries from Robert Vandenbergh, Senior Executive Vice President
(or his nominee), (b) advise Robert Vandenbergh, Senior
Executive Vice President (or his nominee) of any outstanding
projects and/or matters relating to Employee’s duties to the
Company and the status of the same, (c) perform such other
duties as are reasonably requested by Robert Vandenbergh, Senior
Executive Vice President (or his nominee) to transition
Employee’s services, (d) comply with the Company’s
policies and procedures, as well as his obligations under
Section 11 and 12 of the Employment Agreement and
(e) maintain a professional and positive attitude toward the
Holding Company, the Bank, their respective affiliates and each of
their respective personnel, vendors, and customers (the “
Transition Services ”). The Transition Services shall,
unless otherwise requested by Robert Vandenbergh, Senior Executive
Vice President (or his nominee), be performed by Employee remotely
(to the extent that the Company, in its discretion, provides
Employee with remote access; provided, however, that Employee shall
be permitted to remotely access his e-mails during the Transition
Period) and shall be performed during normal business hours. Unless
otherwise requested by Robert Vandenbergh, Senior Executive Vice
President (or his nominee), Employee will not be expected or
permitted to enter the Company’s premises other than to
transact business as a customer of the Bank. Without limitation of
the foregoing, it is understood and agreed that, effective as of
September 13, 2008, Employee will no longer be expected or
permitted to participate in senior management or other senior level
committees. During the Transition Period (subject to
Employee’s satisfactory performance of the Transition
Services and compliance with Sections 11 and 12 of the Employment
Agreement and the Company’s policies and practices), Employee
shall (a) continue to be paid by the Bank his base salary (at
his base salary rate of $200,000.00 on an annualized basis) in
accordance with the Bank’s customary payroll practices,
(b) be entitled to participate in the Bank’s
then-current benefit plans and programs (excluding commission,
bonus, equity compensation, and severance plans, if any) to the
extent and on the same basis that Employee participated in such
plans and programs prior to the Transition Period, and (c) be
provided with continued use of the Company-owned vehicle that was
provided to Employee for his use prior to the Transition Period
(the “ Vehicle ”), together with insurance
coverage thereon;
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provided, however, the Company shall have no
responsibility to pay or reimburse Employee for the cost of
gasoline for the Vehicle. The Company will pay or reimburse
Employee for the costs of normal and necessary maintenance on the
Vehicle that are incurred prior to the Separation Date; provided,
however, with respect to any maintenance expenses that are incurred
during the Transition Period or that were incurred prior to the
Transition Period but not submitted to the Company for
reimbursement prior to the Transition Period, the Company shall
have no obligation to pay or reimburse Employee for any such
maintenance expenses that exceed $2,000 in the aggregate. Employee
shall continue to be responsible for all personal tax obligations
associated with his personal use of the Vehicle. Nothing in this
Separation Agreement shall limit the Company’s right to
terminate Employee’s employment prior to the Separation Date
if Employee fails to satisfactorily perform the Transition Services
or otherwise fails to comply with his obligations during the
Transition Period.
3. General Releases
.
(A) Employee General Release of
the Released Parties . In consideration of the release by the
Company set forth in Section 3(B) below, the Covenant Waiver
(as defined in Section 5(A) below), the payments set forth in
Section 5(B) below and the Option Amendment (as defined in
Section 5(C) below), Employee hereby unconditionally and
irrevocably releases, waives, discharges and gives up, to the full
extent permitted by law, any and all Claims (as defined below) that
Employee may have against any of the Released Parties, arising on
or prior to the date of Employee’s execution and delivery of
this Separation Agreement to the Company. “ Claims
” means any and all actions, charges, controversies, demands,
causes of action, suits, rights, and/or claims whatsoever for
debts, sums of money, wages, salary, severance pay, commissions,
fees, bonuses, unvested stock options, vacation pay, sick pay, fees
and costs, attorneys’ fees, losses, penalties, damages,
including damages for pain and suffering and emotional harm,
arising, directly or indirectly, out of any promise, agreement
(including, without limitation, the Employment Agreement), offer
letter, contract, understanding, common law, tort, the laws,
statutes, and/or regulations of the State of New Jersey or any
other state and the United States, including, but not limited to,
federal and state whistleblower laws, Title VII of the Civil Rights
Act of 1964, the Civil Rights Act of 1991, the Equal Pay Act, the
Americans with Disabilities Act, the Family and Medical Leave Act,
the Employee Retirement Income Security Act (excluding COBRA), the
Vietnam Era Veterans Readjustment Assistance Act, the Fair Credit
Reporting Act, the Occupational Safety and Health Act, the Age
Discrimination in Employment Act (“ ADEA ”), the
Older Workers’ Benefit Protection Act, the Sarbanes-Oxley Act
of 2002, the New Jersey Law Against Discrimination, the New Jersey
Family Leave Act, the New Jersey Civil Rights Act, and the New
Jersey Conscientious Employee Protection Act, as each may be
amended from time to time, whether arising directly or indirectly
from any act or omission, whether intentional or unintentional.
This Section 3(A) releases all Claims including those of which
Employee is not aware and those not mentioned in this Separation
Agreement. Employee specifically releases any and all Claims
arising out of the Employment Agreement or the termination thereof
and Employee’s employment with the Company or separation
therefrom. Employee expressly acknowledges and agrees that, by
entering into this Separation Agreement, Employee is releasing and
waiving any and all Claims, including, without limitation, Claims
that Employee may have arising under ADEA, which have arisen on or
before the date of Employee’s execution and delivery of this
Separation Agreement to the Company. Notwithstanding the foregoing,
nothing in this Section 3(A) shall be deemed to release the
Company from its obligations arising under this Separation
Agreement.
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(B) Company’s General
Release of Employee . Except as otherwise specifically set
forth in this Separation Agreement, in consideration of the release
by Employee set forth in Section 3(A) of this Separation
Agreement above, the Company hereby irrevocably releases, waives,
discharges and gives up, to the full extent permitted by law, any
and all Company Claims (as defined below) that the Company may have
against Employee arising on or prior to September 12, 2008.
“ Company Claims ” means any and all actions,
charges, controversies, demands, causes of action, suits, rights,
and/or claims whatsoever for debts, sums of money, fees and costs,
attorneys’ fees, losses, penalties, damages, including
damages arising, directly or indirectly, out of any promise,
agreement, contract, understanding, common law, tort, the laws,
statutes and/or regulations of the State of New Jersey or any other
state and the United States that the Company may have against
Employee arising out of: (i) the Employment Agreement and/or
the termination of the Employment Agreement or otherwise arising
out of Employee’s employment with the Company or separation
of Employee’s employment with the Company;
(ii) Employee’s position as an officer and/or member of
any committee of the Holding Company, the Bank or any of their
respective affiliates or Employee’s termination from such
positions; or (iii) by reason of any other matter, cause, or
thing whatsoever arising on or prior to September 12, 2008,
whether arising directly or indirectly from any act or omission,
whether intentional or unintentional. Except as otherwise
specifically set forth in this Section 3(B), this
Section 3(B) releases all Company Claims including those of
which the Company is not aware and those not mentioned in this
Separation Agreement up to and including September 12, 2008.
Notwithstanding the foregoing, nothing in this Section 3(B)
shall be deemed to release Employee from Company Claims that relate
to (i) the obligations of Employee under this Separation
Agreement, (ii) the obligations of Employee pursuant to
Sections 11 and 12 of the Employment Agreement, or (iii) any
act or omission by Employee with respect to which the Company would
not have the power to indemnify Employee pursuant to New Jersey
General Corporation Law or the New Jersey Banking Act of 1948. The
Company agrees that it shall, to the fullest extent permitted under
the Company’s bylaws and applicable law (including the New
Jersey General Corporation Law and the New Jersey Banking Act of
1948), indemnify Employee against all expenses and liabilities in
connection with any proceeding (other than a proceeding by or in
the right of the Company) involving Employee by reason of his
having been an officer or employee of the Company.
4. Representations; Covenant Not
to Sue .
(A) Employee hereby represents and
warrants that (i) Employee has not filed, caused or permitted
to be filed any pending proceeding (nor has Employee lodged a
complaint with any governmental or quasi-governmental authority)
against any of the Released Parties, nor has Employee agreed to do
any of the foregoing, (ii) Employee has not assigned,
transferred, sold, encumbered, pledged, hypothecated, mortgaged,
distributed, or otherwise disposed of or conveyed to any third
party any right or Claim against any of the Released Parties which
has been released in this Separation Agreement, and
(iii) Employee has not directly or indirectly assisted any
third party in filing, causing or assisting to be filed, any Claim
against any of the Released Parties. Except as set forth in
Section 14 below, Employee covenants and agrees that Employee
shall not encourage or solicit or voluntarily assist or participate
in any way in the filing, reporting or prosecution by himself or
any third party of a proceeding or Claim against any of the
Released Parties based upon or relating to any Claim released by
Employee in this Separation Agreement.
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(B) The Company hereby represents
and warrants that (i) the Company has not filed, caused or
permitted to be filed any pending proceeding (nor has the Company
lodged a complaint with any governmental or quasi-governmental
authority) against Employee, nor has the Company agreed to do any
of the foregoing, (ii) the Company has not assigned,
transferred, sold, encumbered, pledged, hypothecated, mortgaged,
distributed, or otherwise disposed of or conveyed to any third
party any right or Company Claim against Employee which has been
released in this Separation Agreement, and (iii) the Company
has not directly or indirectly assisted any third party in filing,
causing or assisting to be filed, any Company Claim against
Employee. Except as may otherwise be required by law, the Company
covenants and agrees that the Company shall not encourage or
solicit or voluntarily assist or participate in any way in the
filing, reporting or prosecution by itself or any third party of a
proceeding or Company Claim against Employee based upon or relating
to any Company Claim released by the Company in this Separation
Agreement.
5. Covenant Waiver; Payments;
Stock Options . As good consideration for Employee’s
execution, delivery and non-revocation of this Separation Agreement
and the Reaffirmation (as defined below):
(A) Effective as of the 8th day
following Employee’s execution and delivery of the
Reaffirmation, the Company shall be deemed to have waived
Employee’s obligations pursuant to clause (ii) of
Section 12(a) of the Employment Agreement (the “
Covenant Waiver ”). For purposes of clarification, it
is understood and agreed that clause (i) of Section 12(a)
of the Employment Agreement ( i.e ., covenant against
employment, solicitation or retention of employees or consultants)
shall remain in full force and effect and, for purposes of clause
(i)&nb
