Exhibit 10.25

SUN BANCORP, INC.

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is hereby entered into effective as
of November 20, 2014 (the “Effective Date”), by and between Sun Bancorp, Inc.
(the “Company”), a New Jersey corporation and the holding company for Sun
National Bank, with its principal executive offices at 350 Fellowship Road,
Suite 101, Mt. Laurel, New Jersey 08054 (the “Executive Offices”), and Mr. Nicos
Katsoulis (“Executive”). Any reference to the “Bank” in this Agreement shall
mean Sun National Bank, or any successor to Sun National Bank.

WHEREAS, Executive and the Board of Directors of the Company desire to enter
into an employment agreement setting forth the terms and conditions of the
employment of Executive and the related rights and obligations of each of the
parties.

NOW, THEREFORE, in consideration of the promises and mutual covenants herein
contained, it is hereby agreed as follows:

 

1. Position and Responsibilities.

(a) During the period of Executive’s employment under this Agreement, Executive
agrees to serve as Executive Vice President and Chief Lending Officer of the
Company and of the Bank. Executive shall have responsibility for the general
management and control of the business and affairs of the Company and its
affiliates and shall perform all duties and shall have all powers which are
commonly incident to the offices of Executive Vice President and Chief Lending
Officer or which, consistent with those offices, are delegated to him by the
President and Chief Executive Officer or the Board of Directors of the Company
(the “Board of Directors”), and Executive shall report directly to the President
and Chief Executive Officer.

(b) During the period of Executive’s employment under this Agreement, except for
periods of absence occasioned by illness, vacation, and reasonable leaves of
absence, Executive shall devote substantially all of his business time,
attention, skill and efforts to the faithful performance of his duties under
this Agreement, including activities and services related to the organization,
operation and management of the Company and its affiliates, as well as
participation in community, professional and civic organizations, which may
promote the business affairs of the Company.

(c) The Company will furnish Executive with the working facilities and staff
customary for executive officers with the titles and duties set forth in this
Agreement and as are necessary for him to perform his duties. The location of
such facilities and staff shall be at the Executive Offices, or such other
location as is mutually agreed to between the Company and Executive.

 

2. Period of Employment.

Executive’s employment under this Agreement shall commence within thirty
calendar days following the date of receipt by both the Company and the Bank of
the final applicable regulatory approvals or non-objections from the FRB and
OCC, respectively, as described in Section 20(b) below. The Company and
Executive acknowledge and agree that Executive’s employment is “at-will,”
meaning that Executive’s employment is for no definite period of time, and
Executive or the Company may terminate such employment relationship at any time
for any reason or no reason. The employment at-will relationship remains in full
force and effect regardless of any statements to the contrary made by company
personnel or set forth in any documents other than those explicitly made to the
contrary and signed by an authorized representative of the Board of Directors of
the Company.

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3. Compensation and Benefits.

(a) Base Salary. The Company agrees to pay Executive during the period of
Executive’s employment under this Agreement a base salary at the rate of
$420,000 per annum, payable in accordance with the customary payroll practices
of the Company, or those of the Bank in accordance with Section 8(b) below. The
Board of Directors or the Compensation Committee of the Board of Directors shall
review annually the rate of Executive’s base salary based upon factors they deem
relevant, and may maintain or increase his base salary, provided that, no such
action shall reduce the rate of base salary below the rate then in effect
without Executive’s express written consent. In the absence of action by the
Board of Directors, Executive shall continue to receive a base salary at the per
annum rate specified above or, if another rate has been established under the
provisions of this Section 3, the rate last properly established by action of
the Board of Directors.

(b) Incentive Compensation. Executive shall be entitled to participate in annual
bonuses and other incentive compensation programs in accordance with the
following terms:

(i) Annual Cash Bonus Opportunity. During each fiscal year of the Company ending
during the period of Executive’s employment, Executive will be eligible to
receive an annual incentive award, payable in cash not later than March 15
immediately following the completion of the fiscal year that is the applicable
performance period, with a target award opportunity of not less than 50% of
Executive’s annual base salary as in effect at the time that the applicable
performance goals are established, with any applicable performance goals to be
mutually developed and agreed upon by Executive and the Compensation Committee
of the Board of Directors within the first 90 days of the performance period;
provided that, for the 2014 fiscal year, Executive’s annual bonus shall be
guaranteed at $125,000, provided that the Executive shall commence employment
not later than November 20, 2014, and such 2014 annual bonus amount shall be
paid to Executive not later than March 15, 2015.

(ii) Annual Equity Award. During each fiscal year of the Company during the
period of Executive’s employment, commencing with the 2015 fiscal year,
Executive will be granted an annual equity award (in the form of restricted
stock or stock options, or a combination thereof, as mutually agreed to by the
Company and Executive, and with such awards based on mutually agreed upon
performance goals) with a grant date value (in the case of stock options based
on the assumptions and methodology used by the Company for financial accounting
purposes) of not less than 50% of Executive’s annual base salary as in effect at
the time that such performance goals are established. Such equity awards will be
granted not later than March 15 immediately following the completion of the
fiscal year that is the applicable performance period upon a determination by
the Company that the applicable performance goals have been attained, and such
awards will vest at the rate of 25% beginning two years from the date of grant
and 25% each year thereafter, subject to Executive’s continued employment with
the Company; provided that, notwithstanding the foregoing, upon Executive’s
termination of employment due to his death or Disability (as defined in
Section 4(c) below), no less than 50% of such Stock Award shall be deemed
vested, earned and non-forfeitable. If more than 50% of the full vesting period
has elapsed, 100% of such Stock Award shall be deemed vested, earned and
non-forfeitable.

For the 2014 fiscal year, Executive will receive an equity award with a grant
date value equal to 50% of Executive’s annual base salary, pro-rated based upon
the number of months employed by the Company during 2014, and such award shall
be granted not later than March 15, 2015. Upon termination of employment other
than termination for Cause (as defined in Section 4(a) below), options to
purchase Company stock that are, or that then become, exercisable shall remain
exercisable for 90 days following such termination, provided that the Executive
shall be in compliance with the post-termination, non-competition and
non-solicitation limitations set forth in Sections 6 and 7 below.

 

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(iii) Matching Equity Grant. To the extent that Executive purchases Company
stock directly from the Company with his own funds directly or through his
retirement accounts, up to a maximum aggregate purchase of $600,000, during the
period beginning immediately following the filing of a Current Report on Form
8-K with the Securities and Exchange Commission disclosing Executive’s
anticipated employment with the Company as its Executive Vice President and
Chief Lending Officer (which shall be filed on the same date as the Company’s
first public release of such information) and ending on the date that is sixty
(60) days following the date on which the Company and the Executive enter into
an Addendum to this Agreement, after first receiving approval of such Addendum
in accordance with 12 C.P.R. Part 359 in accordance with Section 21 herein (the
“Purchased Shares”), then within five (5) business days following each such
purchase (but in no event prior to the date of Executive’s commencement of
employment with the Company as its Executive Vice President and Chief Lending
Officer, Executive will be awarded matching shares of restricted stock by the
Company in an amount equal to 1.5 shares of Company stock for each one
(1) Purchased Share (“Matching Stock”). Executive may purchase shares from the
Company during this period at a price per share equal to the average of the
twenty-four (24) hour daily weighted average trading prices of the Company’s
common stock on the NASDAQ Global Select Market (as calculated by Bloomberg
Screen AQR) on each of the five (5) trading days ending one (1) business day
prior to the purchase. Matching Stock will vest at the rate of 25% after 24
months, 25% after 36 months, and 50% after 48 months from the date Executive
commences employment with the Company, subject to Executive’s continued
employment with the Company; provided that, notwithstanding the foregoing, upon
Executive’s termination of employment due to his death or Disability, awards
that would otherwise vest within 18 months of the date of termination of
employment without regard to such death or Disability shall nevertheless vest
upon such termination of employment. Any dividends paid on the Company common
stock shall be paid on the Purchased Shares and Matching Stock at the same time
and on the same terms and without regard to whether such shares are then vested,
provided that such shares of Matching Stock have not previously been forfeited.
Matching Stock which has previously become vested will nevertheless be subject
to restrictions on sale and transfer until the first to occur of (x) Executive’s
termination of employment for any reason and (y) a “Change in Control” of the
Company (as defined in the Company’s 2010 Stock- Based Incentive Plan; provided,
however, that a Change in Control shall not be deemed to occur solely by reason
of the event that any person, or persons acting in concert, that have previously
been a party to the Securities Purchase Agreement between the Company and WLR
SBI Acquisition Co, LLC dated July 7, 2010 or the Securities Purchase Agreement
among the Company and Bernard A. Brown, Sidney R. Brown, Jeffrey S. Brown, Anne
E. Koons, The Four B’s, Interactive Logistics, LLC, National Distribution
Centers, L.P. and National Freight, Inc. dated July 7, 2010, each as set forth
in the Company’s proxy statement dated September 28, 2010, shall become the
beneficial owner(s) of 25% or more of a class of the Company’s voting
securities), other than permissible transfers to satisfy tax withholding
requirements upon the vesting of such shares, and any stock certificates issued
with respect to shares of Matching Stock shall bear a legend setting forth such
restrictions and limitations. In the event of termination of employment prior to
such Matching Stock becoming vested as provided above, such unvested Matching
Stock shall be forfeited as of the date of such termination of employment and
the restrictions on sale and transfer of such unvested Matching Stock shall not
be removed. The Purchased Shares that entitle Executive to a Matching Stock
award shall be subject to a holding period of thirty-six (36) months from the
date of purchase, but in no event later than the first to occur of
(x) Executive’s termination of employment for any reason and (y) a Change in
Control of the Company.

(v) As of the grant date (or as soon as practicable thereafter) of any equity
awards, including the Purchased Shares and the Matching Stock, the Company shall
cause the shares underlying such awards to be registered under the Securities
Act of 1933, pursuant to a registration statement on Form S-8 (or other
appropriate form) and registered or qualified under applicable state law, and
the Company shall take all actions required to maintain the effectiveness of
such registration statement until all common stock that may be issued, sold or
delivered to Executive has been so issued, sold and/or

 

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delivered or the Company’s obligations have lapsed. The Board of Directors of
the Company shall take all necessary action to ensure that the grants and
purchases contemplated by this Agreement are approved for purposes of Rule 16b-3
of the Securities Exchange Act of 1934.

(c) Other Employee Benefits. In addition to any other compensation or benefits
provided for under this Agreement, Executive shall be entitled to participate in
any employee benefits, fringe benefits, perquisites and business expense
reimbursements that the Company or the Bank offers to full-time employees or
executive management now or in the future on a basis no less favorable than
those provided to similarly situated executives. Without limiting the generality
of the foregoing provisions of this paragraph, Executive shall be entitled to
participate in or receive benefits under all plans relating to stock purchases,
pension, profit sharing, employee stock ownership, supplemental retirement,
group life insurance, medical and other health and welfare coverage that are
made available by the Company or the Bank as of the date Executive commences
employment or at any time in the future during the period of Executive’s
employment under this Agreement, subject to and on a basis consistent with the
terms, conditions and overall administration of such plans and arrangements.
Notwithstanding the foregoing, it is agreed that Executive’s participation in
the Annual Cash Bonus Opportunity set forth at Section 3(b)(i) herein shall be a
substitute for participation in the annual cash bonus under the Management
Committee and Shared Services Incentive Compensation Plan, participation in the
Annual Equity Award set forth at Section 3(b)(ii) herein shall be a substitute
for participation in the annual equity awards under the Management Committee and
Shared Services Incentive Compensation Plan, and the opportunity to receive
Matching Stock as set forth at Section 3(b)(iv) herein shall be a substitute for
participation in the proposed 2014 Performance Equity Plan.

 

4. Termination for Cause; Death; Disability; Good Reason.

(a) Termination for Cause. With respect to termination of Executive’s
employment, “Cause” shall be considered to exist if Executive: (i) has willfully
failed or refused to perform his assigned duties under this Agreement in any
material respect (including, for these purposes, Executive’s inability to
perform such duties as a result of drug or alcohol dependency); (ii) has
committed gross negligence in the performance of, or is guilty of continual
neglect of, his assigned duties; (iii) has been convicted or entered a plea of
guilty or nolo contendere to, the commission of a felony or any other crime
involving dishonesty, personal profit or other circumstance likely, in the
reasonable judgment of the Board of Directors of the Company, to have a material
adverse effect on the Bank and the Company or their business, operations or
reputation taken as a whole; (iv) has violated, in any material respect, any
law, rule, regulation, written agreement or final cease-and-desist order
applicable to the Bank or the Company in his performance of services for the
Bank or the Company or the Company’s or the Bank’s code of conduct; or (v) has
willfully and intentionally breached the material terms of this Agreement in any
material respect. For purposes of this definition, no act or failure to act on
the part of Executive shall be considered “willful” unless it is done, or
omitted to be done, by Executive in bad faith or without reasonable belief that
Executive’s action or omission was in the best interests of the Bank and the
Company. Any act, or failure to act, based upon authority given pursuant to a
resolution duly adopted by the Board of Directors of the Company, the board of
directors of the Bank or the Executive Committee of either board or based upon
the written advice of counsel for the Company shall be conclusively presumed to
be done, or omitted to be done, by Executive in good faith and in the best
interests of the Bank and the Company. Any such determination must be made by a
majority vote of the entire membership of the Board of Directors of the Company
at a meeting of the Board of Directors called and held for that purpose, finding
that, in the good faith opinion of the Board of Directors, Executive’s conduct
satisfies the requirements for termination for Cause. Termination for Cause
shall be effected by written Notice of Termination (as described below) to
Executive setting forth with particularity the grounds for termination.
Notwithstanding any other provision to the contrary, and for the avoidance of
doubt, other than with respect to earned but unpaid salary and such other vested
benefits as are set forth in this Agreement and in

 

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any other agreement or plan, Executive shall not have the right to receive
compensation or other benefits for any period after termination for Cause.
Notwithstanding anything herein to the contrary, Executive acknowledges and
agrees that commencement of employment is further conditioned upon the Company’s
prior receipt of satisfactory results regarding customary drug testing.

(b) Death. Notwithstanding any other provision of this Agreement to the
contrary, in the event of Executive’s death during the period of his employment
under this Agreement, the Company shall make payment to his estate in the amount
of Executive’s base salary through the end of the month in which the death
occurred, and such other vested benefits as are set forth in this Agreement and
in any other agreement or plan. This provision shall not negate any rights
Executive or his beneficiaries may have to death benefits under any employee
benefit plan of the Company or the Bank.

(c) Disability. The Company may terminate Executive’s employment upon a
determination, by vote of a majority of the members of the Board of Directors of
the Company, acting in reliance on the written advice of a medical professional
acceptable to them and reasonably acceptable to Executive or his guardian, that
Executive is suffering from a “Disability,” which shall mean a physical or
mental impairment which, at the date of the determination, has prevented
Executive from performing his assigned duties on a substantially full-time basis
for a period of at least sixty (60) days during the period of six (6) months
ending with the date of the determination or is likely to result in death or
prevent Executive from performing his assigned duties on a substantially
full-time basis for a period of at least sixty (60) days during the period of
six (6) months beginning with the date of the determination. As a condition to
any benefits, the Board of Directors may require Executive to submit to such
physical or mental evaluations and tests as it deems reasonably appropriate. In
the event of Executive’s Disability, Executive will be entitled to payment from
the Company in the amount of all earned but unpaid salary as of the date of
termination of employment and such other vested benefits as are set forth in
this Agreement and in any other agreement or plan. This provision shall not
negate any rights Executive may have to disability benefits under any other plan
of the Company or the Bank. A termination of employment due to Disability under
this Section 4(c) shall be effected by Notice of Termination given to Executive
by the Company and shall take effect on the later of the effective date of
termination specified in such notice or sixty (60) days after the date on which
the Notice of Termination is given to Executive, provided that Executive has not
resumed, on a substantially full-time basis, his employment with the Company as
President and Chief Executive Officer.

(d) Termination for Good Reason. With respect to termination of Executive’s
employment, “Good Reason” shall be considered to exist upon the occurrence of
any of the following events without Executive’s consent:

(i) the assignment to duties materially inconsistent with Executive’s position
(including status, offices, titles and reporting requirements), authority,
duties or responsibilities as contemplated by this Agreement;

(ii) a material diminution in the authorities, duties or responsibilities of the
person to whom Executive is required to report, including a requirement that
Executive report to an officer or employee instead of reporting directly to the
Board;

(iii) a material reduction in Executive’s annual base salary, target annual
bonus or target annual equity award;

(iv) the Company’s requiring Executive to be based at any office or location
resulting in a material increase in Executive’s commute to and from Executive’s
primary residence (for this purpose an increase in the Executive’s commute by 50
miles or more shall be deemed material); or

 

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(v) any other action or inaction that constitutes a material breach by the
Company of this Agreement;

provided that, within ninety (90) days after the initial existence of such
event, the Company shall be given notice and an opportunity, of not less than
thirty (30) days, to remedy in good faith the condition constituting such “Good
Reason” as asserted by Executive. Executive’s employment shall continue in
effect during such time so long as the Company makes diligent efforts during
such time to cure the asserted Good Reason event or condition. In the event that
the Company shall remedy in good faith the event or condition constituting Good
Reason, then Executive’s notice of termination for Good Reason shall be null and
void, and, as a result of such event, the Executive shall not be entitled to
resign with Good Reason. The Company’s remedy of any Good Reason event or
condition with or without notice from Executive shall not relieve the Company
from any obligations to Executive under this Agreement or otherwise and shall
not affect Executive’s rights upon the reoccurrence of the same, or the
occurrence of any other, Good Reason event or condition. Executive’s resignation
hereunder for Good Reason shall not occur later than one hundred fifty
(150) days following the initial date on which the event Executive claims
constitutes Good Reason occurred. In the event of Executive’s termination of
employment for Good Reason, Executive will be entitled to payment from the
Company in the amount of all earned but unpaid salary as of the date of
termination of employment and such other vested benefits as are set forth in
this Agreement and in any other agreement or plan.

 

5. Notice.

(a) Any notice or communication permitted or required by this Agreement shall be
in writing and shall become effective two days after mailing by certified mail,
return receipt requested, postage prepaid, addressed as follows:

 

If to the Company, to: Sun Bancorp, Inc. Attn: Corporate Secretary 350
Fellowship Road Suite 101 Mt. Laurel, NJ 08054

If to Executive, to his address most recently on file with the Company.

(b) Any purported termination of employment by the Company or by Executive shall
be communicated by Notice of Termination to the other party hereto. For purposes
of this Agreement, a “Notice of Termination” shall mean a written notice which
shall indicate the specific termination provision in this Agreement relied upon
to provide a basis for termination of Executive’s employment.

 

6. Post-Termination Obligations.

All payments and benefits to Executive under this Agreement shall be subject to
Executive’s compliance with Section 7 of this Agreement. Executive shall, upon
reasonable notice, furnish such information and assistance to the Company as may
reasonably be required by the Company in connection with any litigation to which
it or any of its affiliates is, or may become, a party, other than any
litigation between Executive and the Company or its affiliates. The Company
shall reimburse Executive for reasonable costs incurred by Executive in
providing such information and assistance.

 

7. Non-Competition, Non-Solicitation and Non-Disclosure.

(a) For a period of one (1) year following Executive’s termination of employment
for any reason other than death, Executive agrees to the application of, and to
abide by, the non-competition and

 

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non-solicitation restrictions and covenants set forth in this Section 7(a).
Notwithstanding the foregoing, no such non-competition and non-solicitation
restrictions shall apply in the event of a termination of employment upon or
following a “Change in Control” (as defined above in Section 3(b)(iv)) that
occurs after the initial term of the change in control and severance agreement
contemplated by Section 21.

(i) Executive will not contact (with a view toward selling any product or
service competitive with any product or service sold or proposed to be sold by
the Company, the Bank, or any subsidiary of such entities) any person, firm,
association or corporation (1) to which the Company, the Bank, or any subsidiary
of such entities sold any product or service during the thirty-six (36) month
period immediately prior to Executive’s termination of employment, or (2) which
Executive was otherwise aware was a client of the Company, the Bank, or any
subsidiary of such entities at the time of termination of employment. Executive
will not directly or indirectly make any such contact, either for his own
benefit or for the benefit of any other person, firm, association, or
corporation.

(ii) Executive hereby agrees that he shall not engage in providing professional
services or enter into employment as an employee, director, consultant,
representative, or similar relationship to any financial services enterprise
(including but not limited to a savings and loan association, bank, credit
union, or insurance company) engaged in the business of offering retail customer
and commercial deposit and/or loan products whereby Executive will have a work
location within the “Geographic Territory”. For purposes of this Agreement, the
term “Geographic Territory” means any location within twenty-five (25) miles of
any retail branch offices of the Bank and any loan production offices or
commercial lending offices of the Company, the Bank, or any subsidiary of such
entities transacting business from such office directly with retail or
commercial deposit and/or loan customers existing as of the date of such
termination of employment, provided that the Geographic Territory shall not
extend outside the State of New Jersey, unless or until, following the date
hereof, the Company or the Bank has opened and is operating outside of the State
of New Jersey any retail branch offices of the Bank and any loan production
offices or commercial lending offices of the Company, the Bank, or any
subsidiary of such entities transacting business from such office directly with
retail or commercial deposit and/or loan customers, in which event the
Geographic Territory shall include any location within twenty-five (25) miles of
each such additional branch or office existing as of the date of such
termination of employment.

(iii) Executive hereby agrees that he shall not, on his own behalf or on behalf
of others, employ, solicit, or induce, or attempt to employ, solicit or induce,
any employee of the Company, the Bank, or any subsidiary of such entities, for
employment with any enterprise, nor will the Executive directly or indirectly,
on his behalf or for others, seek to influence any employee of the Company, the
Bank, or any subsidiary of such entities to leave the employ of the Company, the
Bank, or any subsidiary of such entities.

The provisions of this Section 7(a) shall survive the expiration of this
Agreement.

(b) Non-Disparagement. Executive shall not make any statements that disparage
the Company, the Bank, or any subsidiary of such entities or the business
practices of the Company, the Bank, or any subsidiary of such entities, except
to the extent required by law or by a court or other governmental agency of
competent jurisdiction. The Company and the Bank shall not knowingly or
intentionally make any statements that disparage Executive, and the Company and
the Bank shall each instruct its directors and officers not to make any
statements that disparage Executive. The provisions of this Section 7(b) shall
survive the expiration of this Agreement.

(c) Non-Disclosure. Executive acknowledges that during his employment he will
learn and have access to confidential information regarding the Company and the
Bank and its customers and

 

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businesses (“Confidential Information”). Executive agrees and covenants not to
disclose or use for his own benefit, or the benefit of any other person or
entity, any such Confidential Information, unless or until the Company or the
Bank consents to such disclosure or use, or such information becomes common
knowledge in the industry or is otherwise legally in the public domain.
Executive shall not knowingly disclose or reveal to any unauthorized person any
Confidential Information relating to the Company, the Bank, or any subsidiaries
or affiliates, or to any of the businesses operated by them, and Executive
confirms that such information constitutes the exclusive property of the Company
and the Bank. Executive shall not otherwise knowingly act or conduct himself
(1) to the material detriment of the Company or the Bank, or its subsidiaries,
or affiliates, or (2) in a manner which is inimical or contrary to the interests
of the Company or the Bank. Notwithstanding the foregoing, it shall not be a
breach of this Section 7(c) for Executive to disclose Confidential Information
to the extent that disclosure is (A) requested by the Company or its affiliates
or (B) required by a court or other governmental agency of competent
jurisdiction. The provisions of this Section 7(c) shall survive the expiration
of this Agreement.

(d) Subject to the final sentence of this Section 7(d), the parties hereto,
recognizing that irreparable injury will result to the Company or its
affiliates, its business and property in the event of Executive’s breach of any
provision of this Section 7, agree that in the event of any such breach by
Executive, the Company or its affiliates will be entitled, in addition to any
other remedies and damages available, to an injunction issued by any court of
competent jurisdiction to restrain the violation or attempted violation hereof
by Executive, Executive’s partners, agents, servants, employees and all persons
acting for or under the direction of Executive. Executive further agrees that
the period of restriction set forth in this Section 7 shall be tolled during any
period of violation thereof by Executive. Executive represents and admits that
in the event of his termination of employment with the Company, Executive’s
experience and capabilities are such that Executive can obtain employment in a
business engaged in other lines and/or of a different nature than the Company or
its affiliates, and that the enforcement of a remedy by way of injunction will
not prevent Executive from earning a livelihood. Nothing herein will be
construed as prohibiting the Company or its affiliates from pursuing any other
remedies available to the Company or its affiliates for such breach or
threatened breach, including the recovery of damages from Executive.
Notwithstanding the foregoing, in the event that Executive’s employment is
terminated by the Company or its affiliates without Cause or by Executive for
Good Reason, the parties hereto agree that the only remedy available to the
Company or its affiliates upon a breach of this Section 7 is termination of the
post-termination option exercise period contemplated by Sections 3(b)(ii) and
(iii) of any then outstanding options as of the date of such breach.

 

8. Source of Payments.

(a) All payments provided for in this Agreement shall be timely paid in cash or
check from the general funds of the Company, subject to Section 8(b).

(b) Any compensation or benefits provided to Executive by any direct or indirect
subsidiary of the Company or the Bank shall be applied to offset the obligations
of the Company hereunder in such manner as the Company and the Bank may mutually
agree, it being intended that this Agreement set forth the aggregate
compensation and benefits payable to Executive for all services to the Company,
the Bank and all of their respective direct or indirect subsidiaries and
affiliates.

 

9. Entire Agreement.

This Agreement, together with any subsequent understanding or modifications
thereof as agreed to in writing by the parties, contain all of the terms agreed
upon by the parties with respect to the subject matter of this Agreement and
supersede all prior agreements, arrangements and communications between the
parties concerning such subject matter, whether oral or written. Notwithstanding
anything herein to the contrary, any period that Executive shall have served the
Company, the Bank or any related entity as a

 

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consultant and not as an employee prior to the commencement of Executive’s
employment under this Agreement shall not be deemed service to the Company as an
employee, and shall not be considered or included in any calculation or
determination of time employed by the Company for purposes of this Agreement.

 

10. No Attachment.

Except as required by law, no right to receive payments under this Agreement
shall be subject to anticipation, commutation, alienation, sale, assignment,
encumbrance, charge, pledge or hypothecation, or to execution, attachment, levy
or similar process or assignment by operation of law, and any attempt, voluntary
or involuntary, to affect any such action shall be null, void and of no effect.

 

11. Modification and Waiver.

(a) This Agreement may not be modified or amended except by an instrument in
writing signed by the parties hereto.

(b) No term or condition of this Agreement shall be deemed to have been waived,
nor shall there be any estoppel against the enforcement of any provision of this
Agreement, except by written instrument of the party charged with such waiver or
estoppel. No such written waiver shall be deemed a continuing waiver unless
specifically stated therein, and each such waiver shall operate only as to the
specific term or condition waived and shall not constitute a waiver of such term
or condition for the future as to any act other than that specifically waived.

 

12. Severability.

If, for any reason, any provision of this Agreement, or any part of any
provision, is held invalid, such invalidity shall not affect any other provision
of this Agreement or any remaining part of such provision not held so invalid,
and each such other provision and part thereof shall to the full extent
consistent with law continue in full force and effect.

 

13. Headings for Reference Only.

The headings of sections and paragraphs herein are included solely for
convenience of reference and shall not control the meaning or interpretation of
any of the provisions of this Agreement.

 

14. Governing Law.

Except to the extent preempted by federal law, the validity, interpretation,
performance, and enforcement of this Agreement shall be governed by the laws of
the State of New Jersey, without regard to principles of conflicts of law of New
Jersey.

 

15. Arbitration.

Except as provided in Section 7(d) above, any controversy or claim arising out
of or relating to this Agreement, or the breach thereof, shall be settled
exclusively by arbitration in accordance with the rules then in effect of the
district office of the American Arbitration Association (“AAA”) nearest to the
Executive Offices of the Company, and judgment upon the award rendered may be
entered in any court having jurisdiction thereof, except to the extent that the
parties may otherwise reach a mutual settlement of such issue. The provisions of
this Section 15 shall survive the expiration of this Agreement.

 

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16. No Duty of Mitigation.

Executive shall not be required to mitigate the amount of any payment of
severance benefits if he accepts other compensation for employment with another
entity.

 

17. Indemnification.

Except as prohibited by applicable law, the Company shall provide Executive
(including his heirs, executors and administrators) with coverage under a
directors’ and officers’ liability insurance policy at its expense on terms and
conditions at least as favorable as the most favorable coverage in effect for
other directors and officers of the Company (or any successor) and shall
indemnify Executive (and his heirs, executors and administrators) to the fullest
extent permitted under New Jersey law against all expenses and liabilities
reasonably incurred by him in connection with or arising out of any action, suit
or proceeding in which he may be involved by reason of his having been a
director or officer of the Company or its affiliates (whether or not he
continues to be a director or officer at the time of incurring such expenses or
liabilities), such expenses and liabilities to include, but not be limited to,
judgments, court costs and attorneys’ fees and the costs of reasonable
settlements. The provisions of this Section 17 shall survive the expiration of
this Agreement.

 

18. Successors and Assigns.

This Agreement shall be binding upon, and inure to the benefit of, Executive,
the Company and their respective successors and assigns. The Company shall
require any successor or assignee, whether direct or indirect, by purchase,
merger, consolidation or otherwise, to all or substantially all of the business
or assets of the Bank or the Company, expressly and unconditionally to assume
and agree to perform the Company’s obligations under this Agreement, in the same
manner and to the same extent that the Company would be required to perform if
no such succession or assignment had taken place. Executive shall not assign any
part of Executive’s rights under this Agreement without the written consent of
the Company.

 

19. Withholding; 409A.

(a) All payments required to be made by the Company hereunder to Executive shall
be subject to the withholding of such amounts, if any, relating to tax and other
payroll deductions as the Company may reasonably determine should be withheld
pursuant to any applicable law or regulation.

(b) To the extent that any reimbursements or in-kind payments are subject to
Section 409A of the Code, then such reimbursements or in-kind payments (other
than medical expenses) shall be made in accordance with the requirements of
Section 409A of the Code, including, where applicable, the requirement that
(i) any reimbursement is for expenses incurred during Executive’s lifetime (or
during a shorter period of time specified in this Agreement); (ii) the amount of
expenses eligible for reimbursement, or in-kind benefits provided, during a
calendar year may not affect the expenses eligible for reimbursement, or in-kind
benefits to be provided, in any other calendar year; (iii) the reimbursement of
an eligible expense will be made no later than the last day of the calendar year
following the year in which the expense is incurred; and (iv) the right to
reimbursement or in-kind benefits is not subject to liquidation or exchange for
another benefit.

 

20. Regulatory Matters.

(a) Nothing in this Agreement shall be deemed to constitute an obligation of the
Company or the Bank to make any payments or agree to make any payments to
Executive which require prior approval in accordance with the Federal Deposit
Insurance Corporation (“FDIC”) regulation 12 C.F.R. Part 359, Golden Parachute
and Indemnification Payments.

 

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(b) Notwithstanding anything herein to the contrary, Executive shall not
commence employment with the Company or the Bank prior to both the Company’s and
the Bank’s receipt of the required regulatory approvals or non-objections with
respect to Executive’s employment as contemplated in this Agreement, including
the approval or non-objection by both the Office of the Comptroller of the
Currency (“OCC”) and the Board of Governors of the Federal Reserve System
(“FRB”) to Interagency Notices of Change in Director or Senior Executive
Officer. Further, in the event that (i) either of the Notices of Change in
Director or Senior Executive Officer (the “Notices”) filed by the Bank and
Company under Section 32 of the Federal Deposit Insurance Act, 12 U.S.C. §
183li, to request approval to hire Executive as its Executive Vice President and
Chief Lending Officer of the Bank and the Company is denied by the OCC or the
FRB, respectively, or (ii) the OCC or the FRB indicates that such agency is
unlikely to approve the respective Notice, then the Company shall give notice of
such determination to Executive and thereafter this Agreement shall be deemed
null and void.

 

21. Related Matters.

Following the execution of this Agreement, Executive and the Company shall
cooperate to promptly negotiate in good faith the terms of a change in control
and severance agreement, whether in the form of an amendment to this Agreement
or a separate agreement, to be entered into between Executive and the Company
after first receiving approval in accordance with 12 C.F.R. Part 359.

[signature page follows]

 

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IN WITNESS WHEREOF, Sun Bancorp, Inc. has caused this Agreement to be executed
by its duly authorized officer, and Executive has signed this Agreement, on this
27 day of January 2015.

 

ATTEST:

    SUN BANCORP, INC. /s/ Rita Gannon     By:  

/s/ Thomas M. O’Brien

Rita Gannon       Thomas M. O’Brien    

Its:

  President and Chief Executive Officer

 

WITNESS:     EXECUTIVE /s/ Rita Gannon    

/s/ Nicos Katsoulis

Rita Gannon     Nicos Katsoulis

 

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