Document:

Exhibit 10.2

 

FIRST AMENDMENT TO EMPLOYMENT AGREEMENT

 

THIS FIRST AMENDMENT TO EMPLOYMENT
AGREEMENT (“First Amendment”) is made and entered into as of the 4th day of November 2021, by and between Partners Bancorp,
formerly named Delmar Bancorp (the “Company”), The Bank of Delmarva (the “Bank”), and John W. Breda (“Executive”),
and is effective as of this date.

 

WHEREAS, the Company, the Bank,
and Executive have entered into that certain Employment Agreement dated December 13, 2018 (the “Original Agreement”); and

 

WHEREAS, the Company, the
Bank, Virginia Partners Bank, and OceanFirst Financial Corp. (“OCFC”) are in discussions regarding and anticipate a corporate
combination involving the purchase by OCFC of the stock of the Company that is expected to close on or about March 31, 2022 (the “Transaction”);
and

 

WHEREAS, the Original Agreement
contemplates that on or before December 31, 2021, Executive will have a change in position, whereby he becomes the President and Chief
Executive Officer (“CEO”) of the Company in addition to his role as President and CEO of the Bank; and

 

WHEREAS, in light of the pending
Transaction, the parties agree that the above-referenced change in position should not occur as contemplated by the Original Agreement
and that it is in the best interests of all parties, including Executive, to postpone any such change in position unless and until there
is a determination by the Company Board of Directors, as described below, that the Transaction will not occur; and

 

WHEREAS, the Company, the
Bank, and Executive desire to amend the Original Agreement as set forth herein.

 

NOW, THEREFORE, for and in
consideration of the covenants and conditions hereinafter set forth, and the parties deeming that it is in their mutual best interests
to do so, the Company, the Bank, and Executive, pursuant to Section 17 of the Original Agreement, which permits the parties to modify
the Original Agreement in writing, hereby each consents and agrees to amend the Original Agreement as follows:

 

1.            Section
1.20 of the Original Agreement shall be amended by deleting the current provision, which, for the avoidance of doubt, states that “‘Management
Succession Date’ means December 31, 2021, or such earlier date as the Company Board [of Directors] may in its sole discretion determine,
upon which Executive shall assume the position of President and Chief Executive Officer of the Company in addition to Executive’s
role as President and Chief Executive Officer of the Bank[,]” and replacing current Section 1.20 with the following amended Section
1.20:

 

     

     

    

 

“‘Management Succession
Date’ means the first to occur of the following: (1) the thirtieth (30th) calendar day after the Company Board has determined,
by a majority vote that has taken place as part of a Company Board meeting, that the transaction whereby OceanFirst Financial Corp.
(“OCFC”) acquires Partners Bancorp (“Transaction”) shall not take place or occur, as previously was
contemplated by the non-binding proposal submitted by OCFC, pursuant to its letter of September 13, 2021, or (2) June 30, 2022,
unless the Company Board, prior to June 30, 2022, has determined, by a majority vote that has taken place as part of a Company Board
meeting, that the Transaction remains viable and the Company Board shall continue to pursue the Transaction beyond June 30, 2022, in
which event the Management Succession Date shall be determined as provided in sub-section (1). On the Management Succession Date,
Executive shall assume the position of President and Chief Executive Officer of the Company in addition to Executive’s role as
President and Chief Executive Officer of the Bank. Executive recognizes, acknowledges and agrees, that if the Transaction is indeed
consummated, there will be no Management Succession Date or Company Board vote as described in sub-section (1) herein.
Notwithstanding the foregoing, in the event that the Company Board vote described in sub-section (1) herein would result in a
Management Succession Date that is earlier than December 31, 2021, then the effective time of the Management Succession Date shall
be delayed until close of business on December 31, 2021, at which time it will be effective.”

 

2.            All
provisions of the Original Agreement that have not been amended by this First Amendment shall remain in full force and effect. Notwithstanding
the foregoing, to the extent there is any inconsistency between the provisions of the Original Agreement and the First Amendment, the
provisions of this First Amendment shall control.

 

3.            Each of the parties hereto will, from time to time, and at all times hereafter, upon every reasonable request to do so by any other
party, make, do, execute and deliver, or cause to be made done, executed and delivered, all such further acts, deeds, assurances and things
as may be reasonably required or necessary in order to further implement and carry out the terms and purpose of this First Amendment.

 

4.            This First Amendment may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together
shall constitute the same agreement, document, or instrument. Any signature page of any such counterpart, or any electronic signature,
PDF or facsimile thereof, may be attached or appended to any other counterpart to complete a fully executed counterpart of such agreement,
document or instrument, and any electronic or facsimile transmission of any signature shall be deemed an original and shall bind such
party.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]

 

    2

     

    

 

IN WITNESS WHEREOF, each of
the parties hereto has caused this First Amendment to be duly executed on its behalf, all as of the day and year first written above.

 

	PARTNERS
    BANCORP (formerly named Delmar Bancorp)	 
	 	 
	By:	 /s/ Jeffrey F. Turner	 
	Name:	 Jeffrey F. Turner	 
	Title:	 Chairman of the Company Board of Directors	 
	 	 
	BANK
    OF DELMARVA	 
	 	 
	By: 	/s/ Jeffrey F. Turner	 
	Name:	 Jeffrey F. Turner	 
	Title:	 Chairman of the Board of Directors	 
	 	 
	EXECUTIVE:	 
	 	 
	By:	 /s/ John W. Breda	 
	Name: 	John W. Breda	 

 

    3Document

Exhibit 4.2
DESCRIPTION OF CAPITAL STOCK 

General

Our authorized capital stock consists of 130,000,000 shares of common stock, par value $0.0001 per share, and 20,000,000 shares of preferred stock, par value $0.0001 per share.

The following description of our common stock summarizes its material terms and provisions, but it is not complete. For the complete terms of our common stock, please refer to our certificate of incorporation and our bylaws that are incorporated by reference into the Annual Report on Form 10-K of which this exhibit is a part.

Common Stock

As of December 31, 2020, there were 21,168,240 shares of common stock outstanding. The holders of our common stock are entitled to one vote for each share held of record on all matters submitted to a vote of the stockholders. The holders of common stock are not entitled to cumulative voting rights with respect to the election of directors, and as a consequence, minority stockholders will not be able to elect directors on the basis of their votes alone.

Subject to preferences that may be applicable to any then outstanding shares of preferred stock, holders of common stock are entitled to receive ratably such dividends as may be declared by the board of directors out of funds legally available therefor. In the event of a liquidation, dissolution or winding up of us, holders of the common stock are entitled to share ratably in all assets remaining after payment of liabilities and the liquidation preferences of any then outstanding shares of preferred stock. Holders of common stock have no preemptive rights and no right to convert their common stock into any other securities. There are no redemption or sinking fund provisions applicable to our common stock. All outstanding shares of common stock are fully paid and non-assessable. The rights, preferences and privileges of holders of our common stock are subject to, and may be adversely affected by, the rights of the holders of shares of any of our outstanding preferred stock.

Listing

Our common stock is listed on the Nasdaq Global Select Market under the symbol “IMUX.”

Transfer Agent and Registrar

The transfer agent and registrar for our common stock is American Stock Transfer & Trust Company, LLC (“AST”). The transfer agent and registrar’s address is 6201 15th Avenue, Brooklyn, New York 11219.

Dividends

We have not declared any cash dividends on our common stock since inception and we do not anticipate paying any cash dividends on our common stock in the foreseeable future.

Possible Anti-Takeover Effects of Delaware Law and our Charter Documents

Some provisions of Delaware law, our amended and restated certificate of incorporation and our amended and restated bylaws could make the following transactions more difficult: an acquisition of us by means of a tender offer, an acquisition of us by means of a proxy contest or otherwise, or the removal of our incumbent officers and directors. It is possible that these provisions could make it more difficult to accomplish or could deter transactions that stockholders may otherwise consider to be in their best interest or in our best interest, including transactions which provide for payment of a premium over the market price for our shares.

These provisions, summarized below, are intended to discourage coercive takeover practices and inadequate takeover bids. These provisions are also designed to encourage persons seeking to acquire control of us to first negotiate with our board of directors. We believe that the benefits of the increased protection of our potential ability to negotiate with the proponent of an unfriendly or unsolicited proposal to acquire or restructure us outweigh the disadvantages of discouraging these proposals because negotiation of these proposals could result in an improvement of their terms.

Delaware Anti-Takeover Statute

We are subject to Section 203 of the Delaware General Corporation Law (the “DGCL”), an anti-takeover statute. In general, Section 203 of the DGCL prohibits a publicly held Delaware corporation from engaging in a “business combination” with an “interested stockholder” for a period of three years following the time the person became an interested stockholder, unless the business combination or the acquisition of shares that resulted in a stockholder becoming an interested stockholder is approved in a prescribed manner. Generally, a “business combination” includes a merger, asset or stock sale, or other transaction resulting in a financial benefit to the interested stockholder. Generally, an “interested stockholder” is a person who, together with affiliates and associates, owns (or within three years prior to the determination of interested stockholder status did own) 15% or more of a corporation’s voting stock. The existence of this provision would be expected to have an anti-takeover effect with respect to transactions not approved in advance by our board of directors, including discouraging attempts that might result in a premium over the market price for the shares of common stock held by our stockholders.

Undesignated Preferred Stock.

The ability of our board of directors, without action by the stockholders, to issue up to 20,000,000 shares of undesignated preferred stock with voting or other rights or preferences as designated by our board of directors could impede the success of any attempt to effect a change in control of us. These and other provisions may have the effect of deferring hostile takeovers or delaying changes in control or management of our company.

Requirements for Advance Notification of Stockholder Nominations and Proposals.

Our amended and restated bylaws establish advance notice procedures with respect to stockholder proposals to be brought before a stockholder meeting and the nomination of candidates for election as directors, other than nominations made by or at the direction of the board of directors or a committee of the board of directors.

Elimination of Stockholder Action by Written Consent.

Our amended and restated certificate of incorporation eliminates the right of stockholders to act by written consent without a meeting.

Staggered Board.

Our board of directors is divided into three classes. The directors in each class will serve for a three-year term, one class being elected each year by our stockholders. This system of electing and removing directors may tend to discourage a third party from making a tender offer or otherwise attempting to obtain control of us, because it generally makes it more difficult for stockholders to replace a majority of the directors.

Removal of Directors.

Our amended and restated certificate of incorporation provides that no member of our board of directors may be removed from office by our stockholders except for cause and, in addition to any other vote required by law, upon the approval of the holders of at least two-thirds in voting power of the outstanding shares of stock entitled to vote in the election of directors.

Stockholders Not Entitled to Cumulative Voting.

Our amended and restated certificate of incorporation does not permit stockholders to cumulate their votes in the election of directors. Accordingly, the holders of a majority of the outstanding shares of our common stock entitled to vote in any election of directors can elect all of the directors standing for election, if they choose, other than any directors that holders of our preferred stock may be entitled to elect.

Authorized but Unissued Shares

Our authorized but unissued shares of common stock and preferred stock will be available for future issuance without stockholder approval. We may use additional shares for a variety of purposes, including future public offerings to raise additional capital, to fund acquisitions and as employee compensation. The existence of authorized but unissued shares of undesignated preferred stock may enable our board of directors to render more difficult or to discourage an attempt to obtain control of us by means of a merger, tender offer, proxy contest or otherwise. For example, if in the due exercise of its fiduciary 

obligations, our board of directors were to determine that a takeover proposal is not in the best interests of us or our stockholders, our board of directors could cause shares of preferred stock to be issued without stockholder approval in one or more private offerings or other transactions that might dilute the voting or other rights of the proposed acquirer, stockholder or stockholder group. The rights of holders of our common stock described above will be subject to, and may be adversely affected by, the rights of any preferred stock that we may designate and issue in the future. The issuance of shares of undesignated preferred stock could decrease the amount of earnings and assets available for distribution to holders of shares of common stock. The issuance may also adversely affect the rights and powers, including voting rights, of these holders and may have the effect of delaying, deterring or preventing a change in control of us.

Director Liability

Our bylaws limit the extent to which our directors are personally liable to us and our stockholders, to the fullest extent permitted by the DGCL. The inclusion of this provision in our bylaws may reduce the likelihood of derivative litigation against directors and may discourage or deter stockholders or management from bringing a lawsuit against directors for breach of their duty of care.

The provisions of Delaware law, our amended and restated certificate of incorporation and our amended and restated bylaws could have the effect of discouraging others from attempting hostile takeovers and, as a consequence, they may also inhibit temporary fluctuations in the market price of our common stock that often result from actual or rumored hostile takeover attempts. These provisions may also have the effect of preventing changes in the composition of our board and management. It is possible that these provisions could make it more difficult to accomplish transactions that stockholders may otherwise deem to be in their best interest.

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