EXHIBIT 10.1

 

August 20, 2012

 

SEPARATION AGREEMENT AND RELEASE

 

This SEPARATION AGREEMENT AND RELEASE (“Agreement”) is made on August 20, 2012,
by and between Edward J. Lipkus, III, (“You”), residing at 119 Greenbrier Drive,
Clarks Green, PA  18411 and First National Community Bank and all of its
affiliates (“Company”), with its principal offices at 200 South Blakely Street,
Dunmore, Pennsylvania, 18512. For purposes of this Agreement, all references to
You shall also include, at all times and without limitation, Your heirs,
executors, administrators, and assigns.  This Agreement was first provided to
You by Company on August 20, 2012, for Your review and consideration and, if You
choose, Your acceptance, in accordance with the terms set forth below.

 

WHEREAS, Your employment relationship with Company shall permanently and
irrevocably end and terminate effective August 31, 2012, in accordance with the
terms set forth herein; and

 

WHEREAS, the Company has provided You with notice and (and hereby confirms by
this Agreement) its intention to separate you from employment; and

 

WHEREAS, Company has, in accordance with the terms set forth herein, agreed to
provide You with a comprehensive severance package/special consideration, as set
forth below, which package/consideration is well in excess of that to which You
otherwise would be eligible or are entitled; and

 

WHEREAS, in exchange for the package/consideration and other benefits afforded
to You by Company under this Agreement, You shall fully, finally and irrevocably
release and discharge Company from any and all claims, causes of action,
disputes or differences which You have or could or may have against Company,
including, but not limited to, those which, in any way arise out of or relate to
Your employment relationship with Company, and covering the entire breadth,
range and period of that employment relationship, including its termination;

 

NOW, THEREFORE, with the intent to be legally bound, and in consideration of
their mutual PROMISES, AGREEMENTS AND COVENANTS exchanged herein, You and
Company hereby agree as follows:

 

1.                                      Your last day of employment with Company
is Friday, August 31, 2012.  As of that date: (i) Your employment with Company
shall permanently and irrevocably end and terminate, and (ii) neither party
shall have further liability or responsibility to the other excepting only as
specifically provided by the express terms of this Agreement, below.

 

2.                                      Upon and in consideration of (i) Your
permanent separation from employment, (ii) Your voluntary and irrevocable
acceptance of the terms of this Agreement, and (iii) Your voluntary and
irrevocable release in favor of Company, all of which will be confirmed and
accomplished by Your signing and returning this Agreement to Company in the
required time period set forth in Paragraph 13(a), herein, You will receive
Special Consideration from Company, as follows:

 

(a)                                 Special Severance in the form of salary
continuation for the period commencing with the date of Your separation from
employment with Company through and ending March 1, 2013 at Your last applicable
rate of pay, less all applicable deductions and withholdings, payable in
bi-weekly installments and in accordance with Company’s regular payroll
practices with the first of such installment payments to be issued by Company on
its first regular payday immediately following the date on which this Agreement
is fully effective;

 

(b)                                 Continuation of Your group health insurance
in the same Company-sponsored plan in which You and/or your eligible dependents
are presently enrolled, through March 31, 2013 with contributions for same made
by Company and by You proportionately and to the same extent as they have been
made through the date of Your separation from employment;

 

(c)                                  Company confirms that it will not challenge
Your eligibility for unemployment compensation (UC) benefits as a result of Your
separation from employment with Company, but You acknowledge Your understanding
that any ultimate determination regarding Your eligibility for UC benefits will
be made by the applicable Commonwealth administrative agency or department.  You
understand that You must provide all information required by such Commonwealth
agency or department in connection with Your application, if any, for UC
benefits, and that Company, likewise, will provide truthful and accurate factual
information in response to a request for same by such agency or department.  You
also confirm Your understanding that Company’s decision not to contest any
application for UC benefits that You may file relating to Your separation from
employment with Company

 

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does not guarantee that You will be determined eligible for UC benefits by the
applicable Commonwealth administrative agency or department.

 

3.                                      Recoupment of Special Severance.  You
agree to repay or return to Company the entire amount of the Special Severance
paid to You pursuant to paragraph 2(a), above, in the event that either Company
or a federal or state regulatory or law enforcement authority determines that
You:

 

(a)                                 Have committed any fraudulent act or
omission, breach of trust or fiduciary duty, or insider abuse with regard to
Company that has had or is likely to have a material adverse effect on Company;

 

(b)                                 Were substantially responsible for the
insolvency of, the appointment of a conservator or receiver for, or the troubled
condition, as defined by applicable regulations of the appropriate federal
banking agency, of Company or any insured depository institution subsidiary of
Company;

 

(c)                                  Have materially violated any applicable
federal or state banking law or regulation that has had or is likely to have a
material effect on Company; or

 

(d)                                 Have violated or conspired to violate one or
all of Sections 215, 656, 657, 1005, 1006, 1007, 1014, 1032, or 1344 of Title 18
of the United States Code, or Sections 1341 or 1343 of such Title affecting a
federally insured financial institution as defined in Title 18 of the United
States Code.

 

4.                                      You acknowledge and agree that the
payments and benefits to be provided to You as Special Consideration under
paragraph 2 (a) through (c) above, are in excess of any contractual and/or
regularly-provided Company severance benefits to which You are otherwise
entitled, and that such additional payments and benefits provide good, valuable
and sufficient consideration to You for Your execution of this Agreement, and,
in particular, for Your Release and Discharge as set forth in Paragraph 7 below.

 

5.                                      Regardless of whether You accept the
terms of this Agreement, You will be paid, at Your last applicable salary rate,
for any accrued and unused paid time attributable to You through Your date of
separation from employment.

 

6.                                      As required by the Consolidated Omnibus
Budget Reconciliation Act (“COBRA”), after Your Company-sponsored group health
insurance continuation coverage expires, pursuant to the terms of this
Agreement, You will be afforded any right You may have by law to continue
medical insurance coverage(s) for You and/or your eligible dependents, at Your
own and sole expense, under the group insurance plan(s) in which You
participate, which plan is maintained by Company, for a period of up to eighteen
(18) calendar months, or any greater amount of time required by law, which
further requirements, if any, shall be fully complied with by Company. 
Information regarding COBRA coverage, including enrollment forms and premium
quotations, will be sent to You separately at the appropriate time.

 

7.                                      (a)                                 You
hereby waive, Release and forever Discharge ‘Company et. al.’ from all claims,
causes of action, lawsuits and demands, attorney’s fees, expenses or other
compensation (all of which are, hereinafter, collectively referred to as
“Claims”), which in any way relate to Your employment with Company and/or the
termination of Your employment, which You do, may or could now or hereafter
have, based upon facts existing as of this date, under any common law, federal,
state or local law, regulation or order, including without limitation,

 

(i)  any and all Claims under:

 

(1)                 Title VII of the Civil Rights Act of 1964 (Title VII), as
amended;

(2)                 The Age Discrimination in Employment Act (ADEA), as amended,
including without limitation by the Older Workers’ Benefit Protection Act;

(3)                 The U. S. Civil Rights Act of 1991, as amended;

(4)                 Sections 1981 through 1988 of Title 42 of the U.S. Code, as
amended;

(5)                 The Americans with Disabilities Act of 1990, as amended;

(6)                 The Genetic Information Nondiscrimination Act;

(7)                 The Worker Adjustment and Retraining Notification Act, as
amended;

(8)                 The Fair Labor Standards Act, as amended;

(9)                 The Equal Pay Act, as amended;

(10)          The National Labor Relations Act, as amended;

(11)          The Employee Retirement Income Security Act of 1974, as amended;

(12)          The Occupational Safety and Health Act, as amended;

(13)          The Family and Medical Leave Act, as amended;

 

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(14)          The Thirteenth and Fourteenth Amendments to the United States
Constitution;

(15)          The Pennsylvania Human Relations Act, as amended;

(16)          The Pennsylvania Minimum Wage Act, as amended;

(17)          The Pennsylvania Wage Payment and Collection Law, as amended;

(18)          The Pennsylvania Whistleblowers’ Act, as amended;

(19)          Qui Tam actions under Chapter 37 of Title 31 of The U.S. Code;

(20)          Any other federal, state or local civil or human rights law,
regulation or ordinance;

(21)          Any public policy, contract, tort or common law; and/or

(22)          Any statutory, common law or other basis for seeking or claiming
costs, fees or other expenses, including attorneys’ fees.

 

(ii)      any and all claims for liability for any acts or omissions by Company
that violate or may have violated Your rights under any contract; or any fair
employment practices law; or any employee relations statute, executive law or
ordinance; or under any other duty or obligation of any kind that the Company
did have, may have had or should have had to You;

 

(iii)     any and all Claims relating to or arising out of any alleged tortious
act, including but not limited to wrongful termination, intentional infliction
of emotional distress and/or defamation;

 

(iv)               any and all Claims which may be alleged against or imputed to
Company by You or by anyone acting on Your behalf; and

 

(v)                  all Claims for wages (including, but not limited to, all
Claims for vacation, sick, holiday or personal days’ pay or severance pay),
monetary and/or equitable relief, and/or employment or re-employment with
Company in any position.

 

(b)                                 You explicitly agree that for purposes of
Your Release and Discharge as set forth in paragraph 7 (a), above, the term
‘Company et. al.’ includes, at all times and without limitation, (i) all owners,
partners, managers, supervisors, directors and agents of First National
Community Bancorp or First National Community Bank, and (ii) any and all
individuals and corporate, business, organizational and/or operational entities
which, in whole or in part, are affiliated with First National Community Bancorp
or First National Community Bank.

 

(c)                                  You hereby acknowledge and agree that the
termination of Your employment relationship with Company is not currently and
will not in the future be subject of any dispute, litigation, action or
challenge of any kind whatsoever.

 

8.                                      (a)                                 You
covenant and promise that You will not interfere in any way with Company’s
business affairs, nor will You make any negative statements, references,
disparaging remarks or the like, either orally or in writing, to any persons or
organizations, or to any other third parties, concerning Company, or concerning
the conduct, affairs, reputation, capabilities or integrity of Company.

 

(b)                                 You also shall keep secret all confidential
information of and/or relating to Company, and shall not disclose them to
anyone, other than Company’s CEO, except with Company’s written consent.  For
the purpose of this provision, confidential information shall mean “any
information in any form or format, (including verbal, documented, and/or
electronically stored information) which (a) is not generally known to the
public or within the business community; (b) was acquired or learned by You as a
result of or in connection with Your employment with Company; and (c) relates to
the business and/or affairs of Company.”  In addition, You shall deliver
promptly to Company, specifically to its Human Resources Officer, Donald Ryan,
and You shall no longer retain, personally or with or through any agent or
representative, any documents or property that belong to Company or relate in
any way to the business of Company that are, directly or indirectly, within Your
possession or under Your control, including, without limitation, confidential
memoranda, notes, records, reports and other documents (and all copies thereof).

 

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(c)                                  You acknowledge and agree that provisions
(a) and (b) above are essential elements of this Agreement, and, therefore, if
You commit a material violation of either provision, Company shall be entitled
to liquidated damages from You in the amount of Five Thousand ($5,000) Dollars
for any such violation, in addition to any and all other damages and relief
available at law or in equity.

 

(d)                                 You will inform Company about every instance
of improper activity of which You are or become aware and will make a full
report of such activity.  You will inform Company immediately if you are or
become aware of any person’s intention to file an action against the Company,
including a qui tam action.

 

9.                                      (a)                                 You
hereby covenant and promise that You shall keep the terms of this Agreement
completely confidential and shall not disclose them, directly or indirectly,
personally or by agency, to any third party (excepting only the Company’s CEO),
specifically including but not limited to any current or future Company employee
or any current or future co-worker or colleague of Yours in any other employment
or engagement You may have, any prospective future employer, any media person or
entity, and the public in general.  You agree not to disclose that you have
separated or are separating until Company makes an announcement of Your
separation or to the extent that the Board or its authorized committee
specifically permits such disclosure.  Unless specifically permitted by the
Board or its authorized committee, You will not make any such disclosure to any
Company employee, representative, customer, supplier or present or prospective
Company business partner prior to the date Company makes such announcement.

 

(b)                                 Notwithstanding the foregoing, You may
disclose the terms and existence of this Separation Agreement and General
Release to Your immediate household family members, tax consultant (for the sole
and exclusive purpose of obtaining financial advice and/or advice concerning the
payment of taxes), and attorney (for the sole and exclusive purpose of obtaining
legal advice), so long as (a) You inform the individual to whom such disclosure
is made about the confidential nature of the information disclosed and (b) the
individual to whom such disclosure is made agrees to keep the disclosed
information strictly confidential in accordance with the terms of this
paragraph; and

 

(c)                                  You acknowledge and agree that the
confidentiality provision set forth in (a) and (b) above is an essential element
of this Agreement, and, therefore, if You violate such provision, Company shall
be entitled to liquidated monetary damages from You in the amount of Five
Thousand ($5000) Dollars for each such violation, in addition to any and all
other damages and relief available at law or in equity.

 

10.                               (a) In light of Your former position and role
with Company, You agree, at no cost or charge to Company other than as set forth
in this Agreement, to cooperate fully with Company and Company’s representatives
(in person, by telephone, or in writing, as reasonably determined necessary by
Company at the time) for a period of twelve (12) months following the effective
date of this Agreement concerning matters or issues regarding the operations and
affairs of Company in which You were involved and/or about which You have
knowledge.

 

(b) You will, therefore, make Yourself available to Company and its
representatives, upon reasonable advance notice, to discuss, debrief and/or
consult with Company on such matters or issues in which You were involved and/or
about which You have knowledge, relating to the operations and/or affairs of
Company, including matters which were in a discussion or planning stage while
You were employed with Company, and such other issues or questions as Company
reasonably determines necessary through this period.

 

(c)  You shall make Yourself available at mutually convenient times and places,
upon reasonable notice to give investigative interviews, depositions and trial
testimony, and otherwise to assist the Company’s attorneys, in connection with
the prosecution or defense of any legal proceedings, including investigations,
involving the Company when You may have relevant knowledge or be a witness or
participant due to Your relationship with the Company.  The Company will make
reasonable efforts to accommodate any other obligations that You may have.  You
shall cooperate with the Company in providing information with respect to all
reports required to be filed by the Company with any government body, any other
information that may be requested by any other government body or in connection
with any government proceeding.  The Company shall pay Your reasonable
out-of-pocket expenses incurred in connection with the above activities.

 

11.                               The provisions of this Agreement, including
but not limited to the payments made by Company to You under and pursuant to
this Agreement, are not intended to be, nor do they in any way or manner
constitute, an express or implied admission by Company of any impropriety,
illegality, or wrongdoing of any kind by Company, or violation of any law,
statute or regulation with respect to any thing or matter whatsoever.

 

12.                               You hereby explicitly acknowledge that You
have carefully read this Agreement and that only after doing so have You
executed and delivered this Agreement, freely and voluntarily, with full
knowledge and understanding of all material facts, statements, promises and
agreements referenced and/or contained herein.

 

13.                               (a)                                 You
acknowledge that You have been advised to seek independent advice and counsel in
connection with this Agreement and have been advised to retain an attorney for
such purpose, and that You have been afforded the time and opportunity necessary
to seek such advice and counsel to the full extent You may so desired; and that
You have been afforded until

 

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September 11, 2012, which is at least twenty-one (21) days from the date on
which You were provided with this Agreement, during which time You may consider
this Agreement and decide whether You will voluntarily agree to and accept it.

 

(b)                                 You understand Your obligations and rights
under this Agreement and, with such knowledge, You have entered into and
executed this Agreement freely and voluntarily.

 

(c)                                  You have been further advised, and hereby
acknowledge, that You fully understand that You may revoke this Agreement within
seven (7) calendar days after the date of Your execution and delivery of it to
Company, by notifying Company in writing of Your desire to revoke this
Agreement, whereupon this Agreement shall be rendered null and void.  In
accordance with Your revocation rights stated in the preceding sentence, the
provisions of this Agreement, including any payment due to You hereunder, shall
not be binding upon Company and shall not be effective until eight (8) calendar
days after Your delivery to Company of this Agreement, with Your signature
affixed hereto, and Your not having exercised Your right to revoke during the
seven (7) calendar days immediately following said delivery.

 

14.                               This Agreement constitutes the comprehensive,
final, complete and only agreement between You and Company with respect to the
subject matters hereof, including both those issues which have been specifically
addressed above and any which have not been specifically addressed above.  This
Agreement supersedes any and all prior understandings and/or agreements between
You and Company, written or verbal, including, but not limited to, any written,
oral, actual or implied employment agreement between You and Company.  No
modification or waiver of the terms of this Agreement shall be valid unless in
writing and signed and dated by Company and by You.

 

15.                               This Agreement shall be governed by and
construed according to the laws of the United States and the Commonwealth of
Pennsylvania.

 

16.                               Should any provisions or terms of this
Agreement be declared or determined to be illegal or invalid by any court or
agency having appropriate authority, the validity of the remaining words,
phrases, sentences, clauses and provisions shall not be affected, and only the
illegal or invalid term of provision shall be stricken from this Agreement.

 

IN WITNESS WHEREOF, the undersigned, having full authority to enter into this
Agreement, acknowledge and execute this Agreement as of this date first set
forth above.

 

 

Employee:

 

First National Community Bank:

 

 

 

By:

/s/ Edward J. Lipkus, III

 

By:

/s/ Donald H. Ryan

By:

Edward J. Lipkus, III

 

By:

Donald H. Ryan

 

 

Human Resources Officer

 

 

 

DATE: August 24, 2012

 

DATE: August 20, 2012

 

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