Exhibit
10.12
  February
20, 2009
 
 
 
 James
Bartholomew
 Executive
Vice President
 Embassy
Bank
 P. O. Box
20405
 Lehigh
Valley, PA 18002
 
 Dear
Jim:
 
 This will
set forth our understandings concerning your continued employment with the
Bank.  This agreement shall supersede and replace all prior agreements
and understandings concerning the terms of your employment.
 
 The term
of your employment by the Bank will be three (3) years from February 20, 2009.
On each February 20th of your employment, the term of your employment will
automatically extend for an additional year beyond the then-existing termination
date, so that upon each automatic extension, your employment contract will again
have a remaining term of three (3) years.
 
 However,
by written notice, the Bank can terminate this Agreement and the employment
relationship without “cause” effective three years from the date of the
notice.  Additionally, the Bank will have the right to immediately
terminate your employment upon thirty (30) days written notice for
“cause”.  For purposes of this Agreement, “cause” is defined as theft,
fraud or dishonesty in connection with your duties at the Bank, your willful
failure to follow the lawful directives of the Board or your willful and
persistent failure to perform your duties at the Bank.  Any
termination by the Bank cannot be contrary to law or public policy.
Additionally, if you become unable to perform your duties due to death or
permanent disability, the Bank’s
obligation to pay any further compensation to you shall terminate as of the date
of such death or disability; subject to the terms of any benefit plans and other
compensation due you under the Bank’s
standard personnel policies and plans. You will be considered permanently
disabled if you are considered as such under the Bank’s
disability plan in which you participate.
 
 The Bank
shall also have the right to immediately terminate your employment in the event
of your voluntary resignation.
 
 It
is intended that by this agreement, the Bank will commit to your employment for
not less than a three-year term and provide additional protections to you in the
event the Bank is sold or acquired.  In exchange, you will provide
certain “non compete” protection to the Bank in the event you voluntarily leave
the employ of the Bank.
 
 You will
continue to be employed by the Bank as an Executive Vice President and our
Senior Commercial Loan Officer.  You will continue to receive your
salary and bonuses, including increases thereto, as shall be agreed by you and
the Board of Directors from time to time. Your salary will not be less than
currently paid.
 
 You will
continue to participate in and receive all benefit plans, stock option plans,
paid vacations and other leave as are provided to other senior officers of the
Bank in accordance with the Bank’s standard personnel policies and the terms of
the Bank’s benefit plans.
 
 We have
agreed to a severance pay arrangement in the event the Bank (or a bank holding
company controlling the Bank) is acquired by or merges into or with another
banking institution, bank holding company or other entity.  In the
event such a transaction is consummated while you are employed by the Bank and
results in another entity obtaining control (through stock ownership, board
membership or otherwise) of the operation and management of the Bank (or a bank
holding company controlling the Bank), the following severance arrangement shall
apply:
  
  If you
are discharged or you resign because your duties, position or title are
materially changed, or if your are relocated 50 miles beyond 512 & 22 in
Bethlehem, PA, in either case within one year of the effective date of such
transaction, you will be paid in a lump sum 300% of the base salary you would
have earned had you not been discharged or resigned for such
reasons.  In addition, the health and fringe benefits package you are
receiving shall continue to be provided to you for a period of one (1) year from
the date of your discharge.  The 300% lump-sum payment would be in
lieu of any compensation due to you for the remainder of your then current term
of employment.
 
 In
consideration of our commitment to the above severance arrangement, you agree
that for a period of one (1) year from any voluntary resignation of your
employment by you, you will not become employed by, or associated with any other
bank if that bank’s
principal office or your place of employment is within fifty (50) miles of the
Bank’s offices at 100 Gateway Drive, Hanover Township, Northampton County,
Pennsylvania.  You recognize that violation of this clause would cause
substantial damages to the Bank.  The foregoing non-compete clause
will not apply in the event the Bank (or a bank holding company controlling the
Bank) is acquired by or merges into or with another banking institution, bank
holding company or other entity and such transaction results in another entity
obtaining control of the Bank through stock ownership or otherwise.
 
 If the
foregoing correctly sets forth our understandings, please sign and return one
copy of this letter to me.
 
 EMBASSY
      BANK FOR THE LEHIGH VALLEYBy
                            /s/
      David M. Lobach Jr.David M. Lobach, Jr.The
      foregoing is agreed.Dated:
      March 14, 2009
                            /s/
      James BartholomewJames Bartholomew