ex10_28.htm


  
    Exhibit
10.28

     

    [1st
Constitution Bancorp Letterhead]

     

     

    November
5, 2009

     

     

    Mr.
Joseph M. Reardon

    
      1st Constitution
Bancorp

    

    
      2650
Route 130 North

    

    
      Cranbury,
New Jersey  08512

    

     

    Dear Mr.
Reardon:

     

    As you
know, 1st Constitution
Bancorp (the “Company,” as further defined below) has entered into a Letter
Agreement, dated December 23, 2008, including the Securities Purchase Agreement
- Standard Terms incorporated therein (the “Participation Agreement”), with the
United States Department of the Treasury (“Treasury”) that provides for the
Company’s participation in the Treasury’s TARP Capital Purchase Program
(“CPP”).

     

    Pursuant
to EESA as implemented by an interim final rule of the Treasury applicable to
the Company and its subsidiaries as a result of its participation in the CPP,
the Company is required to make changes to its compensation agreements for
highly compensated employees of the Company and its subsidiaries.  To
comply with these requirements, and in consideration of the benefits that you
will receive as a result of the Company’s participation in the CPP, you agree as
follows:

     

    
      
        	
                 
      

              	
                (1)

              	
                No Golden Parachute
      Payments.  The Company is prohibited from making any
      golden parachute payments to you during any “CPP Covered
      Period.”  A “CPP Covered Period” is any period during which (a)
      you are a senior executive officer or a highly compensated employee of the
      Company or its subsidiaries, and (b) the Treasury holds the Series B
      Preferred Stock acquired from the Company in the
  CPP.

              


      

       

      
        	
                 
      

              	
                (2)

              	
                Recovery of Bonus and
      Incentive Compensation.  Any bonus and/or incentive
      compensation paid to you during a CPP Covered Period is subject to
      recovery or “clawback” by the Company if the payments were based on
      statements of earnings, revenues, gains or other criteria that are later
      found to be materially inaccurate.

              


      

       

      
        	
                 
      

              	
                (3)

              	
                Tax Gross-up
      Payments.  During the CPP Covered Period, the Company is
      prohibited from providing tax gross-ups or reimbursement for the payment
      of your taxes to you.  For this purpose, providing for such a
      gross-up at a future date after the CPP Covered Period is also
      prohibited.

              


      

       

      
        	
                 
      

              	
                (4)

              	
                Compensation Program
      Amendments.  Each of the Company’s compensation, bonus,
      incentive and other benefit plans, arrangements and agreements (including
      but not limited to, golden parachute, severance and employment agreements)
      (collectively, “Benefit Plans”) with respect to you is hereby amended
      (notwithstanding any contrary language within such Benefit Plans) to the
      extent necessary to give effect to provisions (1), (2) and
      (3).

              


      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      In
addition, the Company is required to review its Benefit Plans to ensure that
they do not encourage senior executive officers to take unnecessary and
excessive risks that threaten the value of the Company.  To the extent
any such review requires revisions to any Benefit Plan with respect to you, you
and the Company hereby agree to execute such additional documents as the Company
deems necessary to effect such revisions.

       

      
        	
                 
      

              	
                (5)

              	
                Definitions and
      Interpretation. This letter shall be interpreted as
      follows:

              


      

       

      “Senior
executive officer” means the Company’s “senior executive officers” as defined in
EESA as implemented by regulations and rules of the Treasury (i.e., the
principal executive officer, the principal financial officer and the next three
most highly compensated employees whose compensation exceeds
$100,000).

       

      “Golden
parachute payment” has the same meaning set forth in EESA as implemented by
regulations and rules of the Treasury from time to time.

       

      “EESA”
means the Emergency Economic Stabilization Act of 2008 as amended by the
American Recovery and Reinvestment Act of 2009 and as the same may be amended
hereafter.

       

      The
“Company” includes 1st
Constitution Bancorp, 1st  Constitution
Bank and any other entity required to be treated as a “TARP recipient” pursuant
to rules or regulations of the Treasury from time to time.

       

    

    Provisions
(1), (2), (3) and (4) of this letter are intended to, and will be interpreted,
administered and construed to comply with EESA as implemented by regulations or
rules of the Treasury and, to the maximum extent consistent with the proceeding,
to permit operation of the Benefit Plans in accordance with their terms before
giving effect to this letter.

     

    This
letter will be governed by the laws of the State of New Jersey, except to the
extent that federal law controls.

     

    The
Company’s Board of Directors appreciates the concessions you are making and
looks forward to your continued leadership.

     

    
      	
               
      

            	
              Very
      truly yours,

            


    

     

    
      	
               
      

            	
              1st
      Constitution Bancorp

            


    

     

    By:              ­/s/ ROBERT F. MANGANO   

    Name: Robert F.
Mangano

    Title:   President

     

    
      	
               
      

            	
              Intending
      to be legally bound, I hereby

            


    

    
      	
               
      

            	
              agree
      with, acknowledge the sufficiency

            


    

    
      	
               
      

            	
              of
      consideration for, and accept the

            


    

    
      	
               
      

            	
              foregoing
      terms.

            


    

     

     

    
      	
               
      

            	
              ­    /s/ JOSEPH M. REARDON   

            


    

    
      	
               
      

            	
              Joseph
      M. Reardon

              
                Date:      November
      7, 2009

              

            


    

     

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