Document:

ex10-1.htm

     

     

    
 

    Exhibit
10.1

    

    AMENDED
AND RESTATED

    CHANGE-IN-CONTROL
AGREEMENT

    “JEFFREY
CARFORA”

     

    

    

    THIS AMENDED AND RESTATED EMPLOYMENT
AGREEMENT (the “Agreement”), is made as of this April 7,
2010”, among PEAPACK-GLADSTONE BANK (“Bank”), a New Jersey state banking
association with its principal office at 190 Main Street, Gladstone, New Jersey
07934, PEAPACK-GLADSTONE FINANCIAL CORPORATION (“Peapack”), a New Jersey
Corporation which maintains its principal office at 158 Route 206 North,
Gladstone, New Jersey 07934 (Peapack and the Bank collectively are the
“Company”) and JEFFREY CARFORA (the “Executive”).

    BACKGROUND

    WHEREAS, the Executive has been
continuously employed by the Bank for many years;

    WHEREAS, the Executive throughout his
tenure has worked diligently in his position in the business of the Bank and
Peapack;

    WHEREAS, the Board of Directors of the
Bank and Peapack believe that the future services of the Executive are of great
value to the Bank and Peapack and that it is important for the growth and
development of the Bank that the Executive continue in his
position;

    WHEREAS, if the Company receives any
proposal from a third person concerning a possible business combination with, or
acquisition of equities securities of, the Company, the Board of Directors of
the Company (the “Board”) believes it is imperative that the Company and the
Board be able to rely upon the Executive to continue in his position, and that
they be able to receive and rely upon his advice, if they request it, as to the
best interests of the Company and its shareholders, without concern that the
Executive might be distracted by the personal uncertainties and risks created by
such a proposal;

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    WHEREAS, to achieve that goal, and to
retain the Executive's services prior to any such activity, the Board of
Directors and the Executive have agreed to enter into this Agreement to govern
the Executive's termination benefits in the event of a Change in Control of the
Company, as hereinafter defined.

    NOW, THEREFORE, to assure the Company
that it will have the continued dedication of the Executive and the availability
of his advice and counsel notwithstanding the possibility, threat or occurrence
of a bid to take over control of the Company, and to induce the Executive to
remain in the employ of the Company, and for other good and valuable
consideration, the Company and the Executive, each intending to be legally bound
hereby agree as follows:

    Definitions

    a.               Cause.  For
purposes of this Agreement “Cause” with respect to the termination by the
Company of Executive's employment shall mean (i) willful and continued failure
by the Executive to perform his duties for the Company under this Agreement
after at least one warning in writing from the Company's Board of Directors
identifying specifically any such failure; (ii) the willful engaging by the
Executive in misconduct which causes material injury to the Company as specified
in a written notice to the Executive from the Board of Directors; or (iii)
conviction of a crime, other than a traffic violation, habitual drunkenness,
drug abuse, or excessive absenteeism other than for illness, after a warning
(with respect to drunkenness or absenteeism only) in writing from the Board of
Directors to refrain from such behavior.  No act or failure to act on
the part of the Executive shall be considered willful unless done, or omitted to
be done, by the Executive not in good faith and without reasonable belief that
the action or omission was in the best interest of the Company.

    b.                Change in
Control.  “Change in Control” means any of the following
events: (i) when Peapack or a Subsidiary acquires actual knowledge that any
person (as such term is used in Sections 13(d) and 14(d)(2) of the Exchange
Act), other than an affiliate of Peapack or a Subsidiary or an employee benefit
plan established or maintained by Peapack, a Subsidiary or any of their
respective affiliates, is or becomes the

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    beneficial
owner (as defined in Rule 13d-3 of the Exchange Act) directly or indirectly, of
securities of Peapack representing more than twenty-five percent (25%) of the
combined voting power of Peapack's then outstanding securities (a “Control
Person”), (ii) upon the first purchase of Peapack's common stock pursuant to a
tender or exchange offer (other than a tender or exchange offer made by Peapack,
a Subsidiary or an employee benefit plan established or maintained by Peapack, a
Subsidiary or any of their respective affiliates), (iii) upon the approval by
Peapack's stockholders of (A) a merger or consolidation of Peapack with or into
another corporation (other than a merger or consolidation which is approved by
at least two-thirds of the Continuing Directors (as hereinafter defined) and the
definitive agreement for which provides that at least two-thirds of the
directors of the surviving or resulting corporation immediately after the
transaction are Continuing Directors (a “Non-Control Transaction”)), (B) a sale
or disposition of all or substantially all of Peapack's assets or (C) a plan of
liquidation or dissolution of Peapack, (iv) if during any period of two (2)
consecutive years, individuals who at the beginning of such period constitute
the Board (the “Continuing Directors”) cease for any reason to constitute at
least two-thirds thereof or, following a Non-Control Transaction, two-thirds of
the board of directors of the surviving or resulting corporation; provided that any
individual whose election or nomination for election as a member of the Board
(or, following a Non-Control Transaction, the board of directors of the
surviving or resulting corporation) was approved by a vote of at least
two-thirds of the Continuing Directors then in office shall be considered a
Continuing Director, or (v) upon a sale of (A) common stock of the Bank if after
such sale any person (as such term is used in Section 13(d) and 14(d)(2) of the
Exchange Act) other than Peapack, an employee benefit plan established or
maintained by Peapack or a Subsidiary, or an affiliate of Peapack or a
Subsidiary, owns a majority of the Bank's common stock or (B) all or
substantially all of the Bank's assets (other than in the ordinary course of
business).  No person shall be considered a Control Person for
purposes of clause (i) above if (A) such person is or becomes the beneficial
owner, directly or indirectly, of more than ten percent (10%) but less than
twenty-five percent (25%) of the combined voting power of Peapack's then
outstanding securities if the acquisition of all voting securities in excess of
ten percent (10%) was approved in

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    advance
by a majority of the Continuing Directors then in office or (B) such person
acquires in excess of ten percent (10%) of the combined voting power of
Peapack's then outstanding voting securities in violation of law and by order of
a court of competent jurisdiction, settlement or otherwise, disposes or is
required to dispose of all securities acquired in violation of law.

    c.              Contract
Period.  “Contract Period” shall mean the period commencing the
day immediately preceding a Change in Control and ending on the earlier of (i)
the third anniversary of the Change in Control or (ii) the death of the
Executive.  For the purpose of this Agreement, a Change in Control
shall be deemed to have occurred at the date specified in the definition of
Change-in-Control.

    d.              Exchange
Act.  “Exchange Act” means the Securities Exchange Act of 1934,
as amended.

    e.               Good
Reason.  When used with reference to a voluntary termination by
Executive of his employment with the Company, “Good Reason” shall mean any of
the following, if taken without Executive's express written
consent:

    (1)               The
assignment to Executive of any duties inconsistent with, or the reduction of
powers or functions associated with, Executive's position, title, duties,
responsibilities and status with the Company immediately prior to a Change in
Control; any removal of Executive from, or any failure to re-elect Executive to,
any position(s) or office(s) Executive held immediately prior to such Change in
Control.  A change in title or positions resulting merely from a
merger of the Company into or with another bank or company which does not
downgrade in any way the Executive's powers, duties and responsibilities shall
not meet the requirements of this paragraph;

    (2)               A
reduction by the Company in Executive's annual base compensation as in effect
immediately prior to a Change in Control or the failure to award Executive
annual increases in accordance herewith;

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (3)                A
failure by the Company to continue any bonus plan in which Executive
participated immediately prior to the Change in control or a failure by the
Company to continue Executive as a participant in such plan on at least the same
basis as Executive participated in such plan prior to the Change in
Control;

    (4)                The
Company's transfer of Executive to another geographic location outside of New
Jersey or more than 25 miles from his present office location, except for
required travel on the Company's business to an extent substantially consistent
with Executive's business travel obligations immediately prior to such Change in
Control;

    (5)                The
failure by the Company to continue in effect any employee benefit plan, program
or arrangement (including, without limitation the Company's retirement plan,
benefit equalization plan, life insurance plan, health and accident plan,
disability plan, deferred compensation plan or long term stock incentive plan)
in which Executive is participating immediately prior to a Change in Control
(except that the Company may institute or continue plans, programs or
arrangements providing Executive with substantially similar benefits); the
taking of any action by the Company which would adversely affect Executive's
participation in or materially reduce Executive's benefits under, any of such
plans, programs or arrangements; the failure to continue, or the taking of any
action which would deprive Executive, of any material fringe benefit enjoyed by
Executive immediately prior to such Change in Control; or the failure by the
Company to provide Executive with the number of paid vacation days to which
Executive was entitled immediately prior to such Change in Control;

    (6)                The
failure by the Company to obtain an assumption in writing of the obligations of
the Company to perform this Agreement by any successor to the Company and to
provide such assumption to the Executive prior to any Change in Control;
or

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (7)                Any
purported termination of Executive's employment by the Company during the term
of this Agreement which is not effected pursuant to all of the requirements of
this Agreement; and, for purposes of this Agreement, no such purported
termination shall be effective.

    f.               Subsidiary.  “Subsidiary”
means any corporation in an unbroken chain of corporations, beginning with
Peapack, if each of the corporations other than the last corporation in the
unbroken chain owns stock possessing 50% or more of the total combined voting
power of all classes of stock in one of the other corporations in such
chain.

    2.             Employment.  The
Company hereby agrees to employ the Executive, and the Executive hereby accepts
employment, during the Contract Period upon the terms and conditions set forth
herein.

    3.             Position.  During
the Contract Period the Executive shall be employed as Senior Vice President
of  Peapack-Gladstone Bank, or such other corporate or divisional
profit center as shall then be the principal successor to the business, assets
and properties of the Company, with substantially the same title and the same
duties and responsibilities as before the Change in Control.  The
Executive shall devote his full time and attention to the business of the
Company, and shall not during the Contract Period be engaged in any other
business activity.  This paragraph shall not be construed as
preventing the Executive from managing any investments of his which do not
require any service on his part in the operation of such
investments.

    4.             Cash
Compensation.  The Company shall pay to the Executive
compensation for his services during the Contract Period as
follows:

    a.              Base
Salary.  A base annual salary equal to the annual salary in
effect as of the Change in Control.  The annual salary shall be
payable in installments in accordance with the Company's usual payroll
method.

    b.              Annual
Bonus.  An annual cash bonus equal to at least the average of
the bonuses paid to the Executive in the three years prior to the Change in
Control.  The bonus shall be payable at the time and in the manner
which the Company paid such bonuses prior to the Change in
Control.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    c.               Annual
Review.  The Board of Directors of the Company during the
Contract Period shall review annually, or at more frequent intervals which the
Board determines is appropriate, the Executive's compensation and shall award
him additional compensation to reflect the Executive's performance, the
performance of the Company and competitive compensation levels, if appropriate,
all as determined in the discretion of the Board of Directors.

    5.             Expenses and Fringe
Benefits.

    a.          
    Expenses.  During
the Contract Period, the Executive shall be entitled to reimbursement for all
business expenses incurred by him with respect to the business of the Company in
the same manner and to the same extent as such expenses were previously
reimbursed to him immediately prior to the Change in Control.

    b.               Supplemental Retirement
Plan.  During the Contract Period, if the Executive was
entitled to benefits under any supplemental retirement plan prior to the Change
in Control, the Executive shall be entitled to continued benefits under such
plan after the Change in Control and such plan may not be modified to reduce or
eliminate such benefits during the Contract Period.

    c.               Club Membership and
Automobile.  If prior to the Change in Control, the Executive
was entitled to membership in a country club and/or the use of an automobile, he
shall be entitled to the same membership and/or use of an automobile at least
comparable to the automobile provided to him prior to the Change in
Control.

    d.        
      Other
Benefits.  The Executive also shall be entitled to vacations
and sick days, in accordance with the practices and procedures of the Company,
as such existed immediately prior to the Change in Control.  During
the Contract Period, the Executive also shall be entitled to hospital, health,
medical and life insurance, and any other benefits enjoyed, from time to time,
by senior officers of the Company, all upon terms as favorable as those enjoyed
by other senior officers of the Company.  Notwithstanding anything in
this paragraph 5(d) to the contrary, if the Company adopts any change in the
benefits provided for senior officers of

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    the
Company, and such policy is uniformly applied to all officers of the Company
(and any successor or Acquiror of the Company, if any), including the chief
executive officer of such entities, then no such change shall be deemed to be
contrary to this paragraph.

    6.            Termination for
Cause.  The Company shall have the right to terminate the
Executive for Cause, upon written notice to him of the termination which notice
shall specify the reasons for the termination.  In the event of
termination for Cause the Executive shall not be entitled to any further
benefits under this Agreement.

    7.            Disability.  During
the Contract Period if the Executive becomes permanently disabled, or is unable
to perform his duties hereunder for 4 consecutive months in any 12 month period,
the Company may terminate the employment of the Executive.  In such
event, the Executive shall not be entitled to any further benefits under this
Agreement.

    8.            Death
Benefits.  Upon the Executive's death during the Contract
Period, his estate shall not be entitled to any further benefits under this
Agreement.

    9.            Termination Without Cause or
Resignation for Good Reason.  The Company may terminate the
Executive without Cause during the Contract Period by written notice to the
Executive providing four weeks notice.  The Executive may resign for
Good Reason during the Contract Period upon four weeks' written notice to the
Company specifying facts and circumstances claimed to support the Good
Reason.  The Executive shall be entitled to give a Notice of
Termination that his or her employment is being terminated for Good Reason at
any time during the Contract Period, not later than twelve months after any
occurrence of an event stated to constitute Good Reason.  If the
Company terminates the Executive's employment during the Contract Period without
Cause or if the Executive Resigns for Good Reason, the Company shall, subject to
Section 12 hereof:

    (a)           Within
20 business days of the termination of employment (as determined under Section
409A of the Internal Revenue Code) pay the Executive a lump sum severance
payment in an amount equal to

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    three
(3.0) times the highest annual cash compensation, consisting solely of salary
and bonus, as well as any 401(k) deferral, paid to the Executive during any
calendar year in each of the three calendar years immediately prior to the
Change in Control, along with any Gross-Up Payment due under Section 12 hereof
for the calendar year of the termination; and

    (b)           Continue
to provide the Executive during the remainder of the Contract Period with
health, hospitalization and medical insurance, as were provided at the time of
the termination of his employment with the Company, at the Company's cost
(subject to standard deductibles and co-pays, and the Executive’s continuing
payment of his part of the premium for family coverage, if
applicable).

    The Executive shall not have a duty to
mitigate the damages suffered by him in connection with the termination by the
Company of his employment without Cause or a resignation for Good Reason during
the Contract Period.  If the Company fails to pay the Executive the
lump sum amount due him hereunder or the Gross-Up Payment due under Section 12
hereof, or to provide him with the health, hospitalization and medical insurance
benefits due under this section, the Executive, after giving 10 days' written
notice to the Company identifying the Company's failure, shall be entitled to
recover from the Company all of his reasonable legal fees and expenses incurred
in connection with his enforcement against the Company of the terms of this
Agreement.  The Executive shall be denied payment of his legal fees
and expenses only if a court finds that the Executive sought payment of such
fees without reasonable cause and not in good faith.

    10.           Resignation Without Good
Reason.  The Executive shall be entitled to resign from the
employment of the Company at any time during the Contract Period without Good
Reason, but upon such resignation the Executive shall not be entitled to any
additional compensation for the time after which he ceases to be employed by the
Company, and shall not be entitled to any of the other benefits provided
hereunder.  No such resignation shall be effective unless in writing
with four weeks' notice thereof.

    11.         
 Non-Disclosure
of Confidential Information.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    a.               Non-Disclosure of
Confidential Information.  Except in the course of his
employment with the Company and in the pursuit of the business of the Company or
any of its subsidiaries or affiliates, the Executive shall not, at any time
during or following the Contract Period, disclose or use, any confidential
information or proprietary data of the Company or any of its subsidiaries or
affiliates.  The Executive agrees that, among other things, all
information concerning the identity of and the Company's relations with its
customers is confidential information.

    b.               Specific
Performance.  Executive agrees that the Company does not have
an adequate remedy at law for the breach of this section and agrees that he
shall be subject to injunctive relief and equitable remedies as a result of the
breach of this section.  The invalidity or unenforceability of any
provision of this Agreement shall not affect the force and effect of the
remaining valid portions.

    c.               Survival.  This
section shall survive the termination of the Executive's employment hereunder
and the expiration of this Agreement.

    12.           Gross-Up for
Taxes.

    a.     
        Additional
Payments.  If, for any taxable year, Executive shall be liable
for the payment of an excise tax under Section 4999 or other substitute or
similar tax assessment (the "Excise Tax") of the Internal Revenue Code of 1986,
as amended (the "Code"), including the corresponding provisions of any
succeeding law, with respect to any payments under this Section 12 or any
payments and/or benefits under this Agreement or under any benefit plan of the
Company applicable to Executive individually or generally to executives or
employees of the Company, then, the Company shall pay to the Executive, subject
to Section 15 hereof by paying the withholding for the Executive, an additional
amount (the "Gross-Up Payment") such that the net amount retained by the
Executive, after deduction of any Excise Tax on such payments and benefits and
any federal, state and local income tax and Excise Tax upon payments provided
for in this Section 12, shall be equal to the payments due to the Executive
hereunder and the payments and/or benefits due to the Executive under any
benefit plan of the Company.  Each Gross-Up Payment shall be made in
good funds upon the later of

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    (i) five
(5) days after the date the Executive notifies the Company or the Company
receives notice from the certified public accounting firm of its need to make
such Gross-Up Payment, or (ii) the date of any payment causing the liability for
such Excise Tax.  The amount of any Gross-Up Payment under this
section shall be computed by a nationally recognized certified public accounting
firm designated jointly by the Company and the Executive.  The cost of
such services by the accounting firm shall be paid by the Company.  If
the Company and the Executive are unable to designate jointly the accounting
firm, then the firm shall be the accounting firm used by the Company immediately
prior to the Change in Control.

    b.       
     IRS Disputed
Claims.  The Executive shall notify the company in writing of
any claim by the Internal Revenue Service ("IRS") that, if successful, would
require the payment by the Company of a Gross-Up Payment in addition to that
payment previously paid by the Company pursuant to this section.  Such
notification shall be given an soon as practicable but no later than fifteen
(15) business days after the Executive is informed in writing of such claim and
shall apprise the Company of the nature of such claim, the date on which such
claim is requested to be paid, and attach a copy of the IRS
notice.  The Executive shall not pay such claim prior to the
expiration of the thirty (30) day period following the date on which the
Executive gives such notice to the Company (or such shorter period ending on the
date that any payment of taxes with respect to such claim is due).  If
the Company notifies the Executive in writing prior to the expiration of such
period that it desires to contest such claim, the Executive shall:

    (i)  Give the Company any
information reasonably requested by the Company relating to such
claim;

    (ii)  Take such action in
connection with contesting such claim as the Company shall reasonably request in
writing from time to time, including, without limitation, accepting legal
representation with respect to such claim by an attorney reasonably selected by
the Company;

    (iii)  Cooperate with the
Company in good faith in order effectively to contest such claim;
and

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    (iv)  Permit the Company to
participate in any proceedings relating to such claim; provided, however that
the Company shall pay directly all costs and expenses (including legal and
accounting fees, as well as other expenses and any additional interest and
penalties) incurred by the Executive and the Company in connection with an IRS
levy, contest or claim and provided further that the Company shall not take any
action or fail to make any Gross-Up Payment so as to cause the assessment of any
IRS levy and the Company shall cause any levy so assessed to be immediately
released by payment of the Gross-Up Amount, together with all costs, interest
and penalties.

    13.           Term and Effect Prior to
Change in Control.

    a.           
   Term.  Except
as otherwise provided for hereunder, this Agreement shall commence on the date
hereof and shall remain in effect for a period of 3 years from the date hereof
(the “Initial Term”) or until the end of the Contract Period, whichever is
later.  The Initial Term shall be automatically extended for an
additional one year period on the anniversary date hereof (so that the Initial
Term is always 3 years) unless, prior to a Change in Control, the Chairman of
the Board of Directors of Peapack notifies the Executive in writing at any time
that the Contract is not so extended, in which case the Initial Term shall end
upon the later of (i) 3 years after the date hereof, or (ii) 2 years after the
date of such written notice.

    b.               No Effect Prior to Change in
Control.  This Agreement shall not affect any rights of the
Company to terminate the Executive prior to a Change in Control or any rights of
the Executive granted in any other agreement or contract or plan with the
Company.  The rights, duties and benefits provided hereunder shall
only become effective upon and after a Change in Control.  If the
full-time employment of the Executive by the Company is ended for any reason
prior to a Change in Control, this Agreement shall thereafter be of no further
force and effect.

    14.          Severance Compensation and
Benefits Not in Derogation of Other Benefits.  Anything to the
contrary herein contained notwithstanding, the payment or obligation to pay any
monies, or granting of any benefits, rights or privileges to Executive as
provided in this Agreement shall not be in lieu or derogation of
the

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    rights
and privileges that the Executive now has or will have under any plans or
programs of or agreements with the Company, except that if the Executive
received any payment hereunder, he shall not be entitled to any payment under
the Company’s severance policies for officers and employees.

    15.          Payroll and Withholding
Taxes.  All payments to be made or benefits to be provided
hereunder by the Company shall be subject to applicable federal and state
payroll or withholding taxes.  Any Gross-Up Payment shall be made in
the form of withholding taxes and shall not be paid to the Executive, but shall
be sent to the IRS in the ordinary course of the Company’s payroll
withholding.

    16.          Delay in
Payment.   Notwithstanding anything else to the contrary
in this Agreement, or any other plan, contract, program or otherwise, the
Company (and its affiliates) are expressly authorized to delay any scheduled
payments under this Agreement and any other plan, contract, program or
otherwise, as such payments relate to the Executive, if the Company (or its
affiliates) determines that such delay is necessary in order to comply with the
requirements of Section 409A of the Internal Revenue Code.  No such
payment may be delayed beyond the date that is six (6) months following the
Executive’s separation from service (as defined in Section 409A).  At
the end of such period of delay, the Executive will be paid the delayed payment
amounts, plus interest for the period of such delay.  For purposes of
the preceding sentence, interest shall be calculated using the six (6) month
Treasury Bill rate in effect on the date on which the payment is delayed, and
shall be compounded daily.  Notwithstanding the foregoing, in the
event that the conditions of the severance exception under Treasury Regulation
Section 1.409A-1(b)(9)(iii) are satisfied, payment of the benefit will not be
delayed for six (6) months following termination from employment to the extent
permitted under the severance exception.  This Agreement is intended
to be compliant with the terms and conditions of Section 409A of the Internal
Revenue Code, and shall be administered accordingly.

    17.          Prohibition on Any Payment
that Becomes Due While TARP Restrictions Apply.    At
the time of execution of this Agreement, the Company is subject to certain
limitations arising as a result of the Company’s participation in the Capital
Purchase Program (“CPP”) of the Troubled Asset Relief Program

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    (“TARP”),
through the United States Treasury’s purchase of preferred stock of the Company
under the CPP.  At the time of execution of this Agreement, the United
States Treasury’s interim final rules issued under the Emergency Economic
Stabilization Act of 2008, as amended by the American Recovery and Reinvestment
Act of 2009, specifically 31 C.F.R. § 30.9, prohibit the Company, as a TARP
recipient, from making any golden parachute payment to a senior executive
officer and any of the next five most highly compensated employees during the
TARP period (as such terms are defined under the interim final
rule).  Accordingly, the Executive and the Company hereby specifically
agree that, notwithstanding any other provision of this Agreement, no payments
or benefits shall be payable to the Executive hereunder or due to the Executive
in the future hereunder if the employment of the Executibve is terminated at a
time when the Company is prohibited from making a golden parachute payment to
the Executive (and that any payments made hereunder that do violate the TARP
standards are subject to immediate repayment by the Executive and immediate
clawback by the Company).

    18.          Miscellaneous.  This
Agreement is the joint and several obligation of the Bank and
Peapack.  The terms of this Agreement shall be governed by, and
interpreted and construed in accordance with the provisions of, the laws of New
Jersey.  This Agreement supersedes all prior agreements and
understandings with respect to the matters covered hereby, including expressly
any prior agreement with the Company concerning change-in-control
benefits.  The amendment or termination of this Agreement may be made
only in a writing executed by the Company and the Executive, and no amendment or
termination of this Agreement shall be effective unless and until made in such a
writing.  This Agreement shall be binding upon any successor (whether
direct or indirect, by purchase, merger, consolidation, liquidation or
otherwise) to all or substantially all of the assets of the
Company.  This Agreement is personal to the Executive and the
Executive may not assign any of his rights or duties hereunder but this
Agreement shall be enforceable by the Executive's legal representatives,
executors or administrators.  This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, and it shall not
be necessary in making proof of this Agreement to produce or account for more
than one such counterpart.

    
       

       

       
(signature
page to follow)

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    IN WITNESS WHEREOF, Peapack-Gladstone
Bank and Peapack-Gladstone Financial Corporation each have caused this Agreement
to be signed by their duly authorized representatives pursuant to the authority
of their Boards of Directors, and the Executive has personally executed this
Agreement, all as of the day and year first written above.

    

    

    
      	
              ATTEST:

            	 
      	 
      	
              PEAPACK-GLADSTONE

            
	 
      	 
      	 
      	
              FINANCIAL
      CORPORATION

            
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      /s/ Antoinette Rosell	 
      	 
      	
              By:

            	 
      /s/ Frank A. Kissel	 
      
	Antoinette
      Rosell	
              ,
      Secretary

            	 
      	 
      	Frank
      A. Kissel	
              ,Chairman

            
	 
      	 
      	 
      	 
      	 
      	 
      
	
              ATTEST:

               

               

            	 
      	 
      	
              PEAPACK-GLADSTONE
      BANK

            
	 
      /s/ Antoinette Rosell	 
      	 
      	
              By:

            	 
      /s/ Frank A. Kissel	 
      
	Antoinette
      Rosell  	
              ,
      Secretary

            	 
      	 
      	Frank
      A. Kissel	
              ,Chairman

            
	 
      	 
      	 
      	 
      	 
      	 
      
	
              WITNESS:

            	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      
	 
      /s/ Bridget J. Walsh	 
      	 
      	 
      /s/ Jeffrey J. Carfora	 
      
	Bridget
      J. Walsh  	 
      	 
      	Jeffrey
      J. Carfora	
              ,
      Executiveex10-2.htm

     

     

    
 

    Exhibit
10.2

    

    PEAPACK-GLADSTONE
EMPLOYMENT AGREEMENT

    OF
JEFFREY
CARFORA

     

    This
EMPLOYMENT AGREEMENT is
as of APRIL 7, 2010, by and between Peapack-Gladstone Financial Corporation
(“PGFC”) and
Peapack-Gladstone Bank (the “Bank”) (PGFC and the
Bank are collectively referred to herein as the “Company”), and EXECUTIVE JEFFREY
CARFORA (“Executive”), whose
home address is 24 Karla Drive,
Whippany, NJ 07981.

     

    WITNESSETH:

     

    WHEREAS, the Company desires
to employ Executive pursuant to an agreement embodying the terms of such
employment (this “Agreement”) and
Executive desires to enter into this Agreement and to accept such employment,
subject to the terms and provisions of this Agreement; and

     

    NOW, THEREFORE, in
consideration of the mutual covenants contained herein, the parties agree as
follows:

     

    Section 1.  Term of
Employment.

    

    (a)           The
term of Executive’s employment under this Agreement shall commence on April 7,
2010, (the “Effective
Date”) and end on June 2, 2010 (the “Original Term of
Employment”), unless terminated earlier in accordance
herewith.

    

    (b)           The
Original Term of Employment shall be automatically renewed for successive
one-year terms (the “Renewal Terms”) so
long as the Company does not, prior to 60 days before such expiration date,
deliver a notification of non-renewal to Executive stating that the Company is
electing to terminate this Agreement at the expiration of the then current Term
of Employment.  “Term of Employment”
shall mean the Original Term of Employment and all Renewal Terms.  In
the event that this Agreement is not renewed because the Company has given the
60-day notice prescribed in the preceding paragraph on or before the expiration
of the Original Term of Employment or any Renewal Term, such non-renewal shall
be treated as a “Termination Without Cause” pursuant to Section 5.

     

    Section
2.  Position and Duties.  During the Term of
Employment, the Executive shall serve as the “EXECUTIVE VICE
PRESIDENT/CHIEF FINANCIAL OFFICER” of the Company.  The
Executive shall have such powers and duties as are commensurate with such
position and as may be conferred upon him by the Board of Directors of the
Company (the “Board”).  During
the Term of Employment, the Executive shall devote all of his/her business time,
attention, skill and efforts exclusively to the business and affairs of the
Company and its subsidiaries.  Notwithstanding the foregoing, the
Executive may engage in charitable, educational, religious, civic and similar
types of activities, speaking engagements, membership on the board of directors
of other organizations, and similar activities to the extent that such
activities do not inhibit the performance of his/her duties hereunder or
conflict in any material way with the business of the Company and its
subsidiaries.

     

    Section
3.  Compensation.  For all services rendered by the
Executive in any capacity required hereunder during the Term of Employment,
including, without limitation, services as an executive officer,

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    director,
or member of any committee of the Company or any of its subsidiaries, the
Executive shall be compensated as follows:

     

    (a)           The
Company shall pay the Executive a fixed salary at a rate per annum equal to
$206,000(“Base
Salary”).  Base Salary shall be payable bi-weekly.

     

    (b)           The
Executive shall be eligible to receive a bonus with respect to the Term of
Employment.  The amount, terms and conditions of such bonus shall be
determined in due course by the Board.

     

    (c)           The
Executive shall be entitled to a prorated vacation of three weeks in 2008 and
five weeks of vacation in each calendar year following during the Term of
Employment.  The Executive shall not be entitled to carryover vacation
from one year to another or to any payment in respect of any unused
vacation.

     

    (d)           The
Executive shall be entitled to participate in all compensation and employee
benefit plans for which any salaried employees of the Company are eligible.
Notwithstanding the foregoing, nothing in this Agreement shall preclude the
amendment or termination of any such plan or program.  Executive will
not be entitled to severance under any severance plan of the Company other than
pursuant to this Agreement.

     

    Section
4.  Business Expenses.  The Company shall pay or
reimburse the Executive for all reasonable entertainment, travel or other
expenses incurred by the Executive in connection with the performance of his/her
duties under this Agreement, subject to the Executive’s presentation of
appropriate documentation in accordance with such procedures as the Company may
from time to time establish.

     

    Section
5.  Termination of Employment.

     

    (a)           The
Company shall have the right, upon delivery of written notice to the Executive,
to terminate the Executive’s employment hereunder prior to the expiration of the
Term of Employment:

     

    (i)  pursuant
to a Termination for Cause, or

     

    (ii)
 upon the Executive’s Permanent Disability, or

     

    (iii)  pursuant
to a Termination Without Cause.

     

    (b)           The
Executive shall have the right, upon delivery of written notice to the Company
30 days in advance of the proposed termination date, to terminate the
Executive’s employment hereunder prior to the expiration of the Term of
Employment in the Executive’s sole discretion.

     

    (c)           The
Executive’s employment hereunder shall terminate automatically without action by
any party hereto upon the Executive’s death.

     

    (d)           For
purposes of this Agreement, the following terms have the following
meanings:

     

    “Termination for
Cause” means a termination of the Executive’s employment by the Company
because the Executive has (a) materially failed to perform the duties
assigned to him hereunder or imposed upon him by applicable law, and such
failure to perform constitutes self-dealing, willful misconduct or recklessness,
(b) committed an act of dishonesty in the performance of his/her duties
hereunder or engaged in conduct materially detrimental to the business of the
Company, (c) been convicted of a felony or a misdemeanor involving moral
turpitude, (d) materially failed to perform his/her duties hereunder, which
breach or failure the Executive shall fail to remedy within 30 days
after

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    written
demand from the Company, (e) knowingly failed to follow lawful, written
directives of the Board, or (f) engaged in any material employment act or
practice, including but not limited to sexual harassment, forbidden by the
Company in its employment manual as revised from time to time.

     

    “Termination Without
Cause” means a termination of the Executive’s employment by the Company
other than due to Permanent Disability, retirement or expiration of the Term of
Employment and other than a Termination for Cause.

     

    “Permanent Disability”
means permanently disabled so as to qualify for full benefits under the
Company’s then-existing disability insurance policy.  If the Company
does not maintain any such policy on the date of termination, “Permanent Disability”
shall mean the inability of the Executive to work for a period of four full
calendar months during any eight consecutive calendar months due to illness or
injury of a physical or mental nature, supported by the completion by the
Executive’s attending physician of a medical certification form outlining the
disability and treatment.

     

    Section
6.  Benefits Upon Termination.

     

    (a)           In
lieu of any severance that may otherwise be payable to the Executive pursuant to
any policies of the Company, whether existing on the date hereof or in effect
from time to time hereafter, in the event that the Company terminates the
Executive’s employment pursuant to a Termination Without Cause, the Company
shall continue to pay the Executive’s Base Salary for a period (the “Severance Period”)
equal two years from the effective date of such termination.  The
Executive also shall be entitled to any earned but unpaid Base Salary as of the
effective date of termination of employment.  No other payments shall
be made, or benefits provided, by the Company under this Agreement except as
otherwise required by law or the Company’s benefit plans.

     

    (b)           In
the event that the Company terminates the Executive’s employment pursuant to a
Permanent Disability, the Company shall pay the Executive any earned but unpaid
Base Salary as of the date of termination of employment.  No other
payments shall be made, or benefits provided, by the Company under this
Agreement except as otherwise required by law or the Company’s benefit
plans.

     

    (c)           In
the event that the Company terminates the Executive’s employment pursuant to a
Termination for Cause or the Executive terminates his/her employment with the
Company for any reason (including, without limitation, pursuant to any
retirement), the Company shall pay the Executive any earned but unpaid Base
Salary as of the date of termination of employment.  No other payments
shall be made, or benefits provided, by the Company under this Agreement or
otherwise except to the extent required by law or the Company’s benefit
plans.

     

    (d)           In
the event that the Executive’s employment hereunder is terminated due to the
Executive’s death, the Company shall pay the Executive’s executor or other legal
representative (the “Representative”) any
earned but unpaid Base Salary as of the date of termination of
employment.  No other payments shall be made, or benefits provided, by
the Company whether under this Agreement or otherwise except to the extent
required by law or the Company’s benefit plans.

     

    (e)           Any
payments to be made or benefits to be provided by the Company pursuant to this
Section 6 (other than in the event of the Executive’s death or Permanent
Disability) are subject to the receipt by the Company of an effective general
release and agreement not to sue, in form and substance reasonably satisfactory
to the Company (the “Release”) pursuant to
which the Executive agrees (i) to release all claims

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    against
the Company and certain related parties (excluding claims for (x)
indemnification under the Company’s Certificate of Incorporation or by-laws or
(y) any severance benefits arising out of this Agreement or otherwise), (ii) not
to maintain any action, suit, claim or proceeding against the Company, its
subsidiaries and affiliates and certain related parties, and (iii) to be bound
by certain confidentiality and mutual non-disparagement covenants specified
therein.  Notwithstanding the due date of any post-employment payment,
the Company shall not be obligated to make any payments under this Section 6
until after the expiration of any revocation period applicable to the
Release.

     

    (f)           The
Executive shall not be required to mitigate the severance payments to be made to
him hereunder and if the Executive obtains other employment while receiving
severance payments hereunder he shall continue to be entitled to the benefits of
this Agreement.

     

    (g)           Notwithstanding
anything else herein to the contrary in this Section 5 or otherwise,
distributions to be made to Executive may be delayed for up to 6 months in order
to avoid adverse tax implications to Executive, the Company or other similarly
situated employees under Section 409A of the Internal Revenue Code of 1986 (the
“Code”).  At
the end of such period of delay, you will be paid the delayed payment amounts,
plus interest for the period of any such delay.  For purposes of the
preceding sentence, interest shall be calculated using the six (6) month
Treasury Bill rate in effect on the date on which the payment is delayed, and
shall be compounded daily.

     

    Section
7.  Confidential Information. The Executive and the Company
agree that all information pertaining to the affairs, business, clients, or
customers of the Company or any of its subsidiaries, other than information that
the Company has previously made publicly available, is confidential information
belonging to the Company and is a unique and valuable asset of the
Company.  Both during the Term of Employment hereof and thereafter,
the Executive shall not, except to the extent reasonably necessary in the
performance of his/her duties for the Company during the Term of Employment,
disclose any information concerning the affairs, businesses, clients, or
customers of the Company or its subsidiaries, or make use of any such
information for his/her own purposes or for the benefit of any other person,
firm, or corporation.  All records, memoranda, letters, books, papers,
reports, or other data, and other records and documents relating to the Company
or its subsidiaries, whether made by the Executive or otherwise coming into
his/her possession, shall remain the property of the Company, no copies thereof
shall be made which are not retained by the Company, and the Executive agrees,
on termination of his/her employment not to retain any copies and deliver all
such confidential information in his/her possession to the Company.

     

    Section
8.  Non-Compete; Non-Solicitation.

     

    (a)           During
the period (the “Restricted Period”)
commencing on the termination of his/her employment for any reason whatsoever,
except in the event of Change in Control, during the Term of Employment and
ending one year thereafter, the Executive shall not, without express prior
written consent of the Company, directly or indirectly, own or hold any
proprietary interest in, or be employed by or receive remuneration from, any
corporation, partnership, sole proprietorship or other entity (collectively, an
“entity”)
“engaged in competition” (as defined below) with the Company or any of its
subsidiaries (a “Competitor”). For
purposes of the preceding sentence, (i) the term “proprietary interest” means
direct or indirect ownership of an equity interest in an entity other than
ownership of less than 2 percent of any class stock in a publicly-held entity,
and (ii) an entity shall be considered to be “engaged in competition” if such
entity is, or is a holding company for or a subsidiary of an entity which is
engaged in the business of (A) providing banking, trust services, asset
management advice, or similar financial services to consumers, businesses
individuals or other

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    entities,
and (B) the entity, holding company or subsidiary maintains any physical offices
for the transaction of such business located within 50 miles of the main office
of the Company.

     

    (b)           During
the Restricted Period, and for a period of one year thereafter, the Executive
shall not, either directly or indirectly, for himself or on behalf of or in
conjunction with any other person, company, partnership, corporation or business
of whatever nature, (i) call upon any person or entity which is or has been
within 24 months prior to the termination or other cessation of Executive’s
employment for any reason, a customer of the Company or any subsidiary (each a
“Customer”) for
the direct or indirect purpose of soliciting or selling deposit, loan or trust
products or services or (ii) induce any Customer to curtail, cancel, not renew,
or not continue their business with the Company or any subsidiary.

     

    (c)           During
the Restricted Period, and for a period of one year thereafter, the Executive
shall not, without the express prior written consent of the Company, directly or
indirectly, (i) solicit or assist any third party in soliciting for employment
any person employed by the Company or any of its subsidiaries at the time of the
termination of the Executive’s employment (collectively, “Employees”), (ii)
employ, attempt to employ or materially assist any third party in employing or
attempting to employ any Employee, or (iii) otherwise act on behalf of any
Competitor to interfere with the relationship between the Company or any of its
subsidiaries and their respective Employees.

     

    (d)           The
Executive acknowledges that the restrictions contained in this Section 8
are reasonable and necessary to protect the legitimate interests of the Company
and that any breach by the Executive of any provision contained in this Section
8 will result in irreparable injury to the Company for which a remedy at law
would be inadequate.  Accordingly, the Executive acknowledges that the
Company shall be entitled to temporary, preliminary and permanent injunctive
relief against the Executive in the event of any breach or threatened breach by
the Executive of the provisions of this Section 8, in addition to any other
remedy that may be available to the Company whether at law or in
equity.  With respect to any provision of this Section 8 finally
determined by a court of competent jurisdiction to be unenforceable, such court
shall be authorized to reform this Agreement or any provision hereof so that it
is enforceable to the maximum extent permitted by law. If the covenants of
Section 8 are determined to be wholly or partially unenforceable in any
jurisdiction, such determination shall not be a bar to or in any way diminish
the Company’s right to enforce such covenants in any other jurisdiction and
shall not bar or limit the enforceability of any other provisions.

     

    (e)           The
provisions of this Section 8 shall survive the termination of the Executive’s
employment with the Company for any reason whatsoever so long as the termination
of employment occurs during the Term of Employment.  If there is no
termination of Executive’s employment during the Term of Employment, the
provisions of this Section 8 shall expire and be of no further force and effect
after the Term of Employment.  The Company shall not be required to
post any bond or other security in connection with any proceeding to enforce the
provisions of this Section 8.

     

    Section
9.  Withholdings.  The Company may directly or
indirectly withhold from any payments made under this Agreement all Federal,
State, City or other taxes and all other deductions as shall be required
pursuant to any law or regulation or pursuant to any contributory benefit plan
maintained by or on behalf of the Company.

     

    Section
10.  Notices.  All notices, requests, demands and
other communications required or permitted hereunder shall be given in writing
and shall be deemed to have been duly given if delivered or mailed, postage
prepaid, by same day or overnight mail (i) if to the Executive, at the address
set forth above, or (ii) if to the Company, as follows:

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

     

    The Board
Of Directors

    Peapack-Gladstone
Bank

    158 Route
206 North

    Gladstone,
NJ 07934

     

    or to
such other address as either party shall have previously specified in writing to
the other.

     

    Section
11.  Binding Agreement; Assignment.  This Agreement
shall be binding upon and shall inure to the benefit of, the Executive and the
Company and its successors and permitted assigns.  This Agreement is
personal to the Executive and may not be assigned by him.  The Company
may assign its rights and  obligations under this Agreement in
connection with a sale of all or substantially all of the business of PGFC or
the Bank.  Any successor to the Company by merger or consolidation
shall be entitled to the benefits of this Agreement.

     

    Section
12.  Governing Law.  This Agreement shall be governed
by, and construed in accordance with, the internal laws of the State of New
Jersey, without reference to the choice of law principles thereof.

     

    Section
13.  Dispute Resolution.  At the option of either the
Company or the Executive, any dispute, controversy or question arising under,
out of or relating to this Agreement, the Executive’s employment or termination
of employment, including but not limited to any and all statutory claims
involving workplace discrimination or wrongful discharge, but excluding claims
pursuant to Sections 7 or 8 hereof, shall be referred for decision by
arbitration in the State of New Jersey by a neutral arbitrator mutually selected
by the parties hereto.  Any arbitration proceeding shall be governed
by the Rules of the American Arbitration Association then in effect or such last
in effect (in the event such Association is no longer in
existence).  If the parties are unable to agree upon such a neutral
arbitrator within 21 days after either party has given the other written notice
of the desire to submit the dispute, controversy or question for decision as
aforesaid, then either party may apply to the American Arbitration Association
for a final and binding appointment of a neutral arbitrator; however, if such
Association is not then in existence or does not act in the matter within 45
days of any such application, either party may apply to a judge of the local
court where the Bank is headquartered for an appointment of a neutral arbitrator
to hear the parties and such judge is hereby authorized to make such
appointment.  In the event that either party exercises the right to
submit a dispute, controversy or question arising hereunder to arbitration, the
decision of the neutral arbitrator shall be final, conclusive and binding on all
interested persons and no action at law or in equity shall be instituted or, if
instituted, further prosecuted by either party other than to enforce the award
of the neutral arbitrator.  The award of the neutral arbitrator may be
entered in any court that has jurisdiction.  The Executive and the
Company shall each bear all their own costs (including the fees and
disbursements of counsel) incurred in connection with any such arbitration and
shall each pay one-half of the costs of any arbitrator.

     

    Section
14.  Entire Agreement.  This Agreement shall
constitute the entire agreement among the parties with respect to the matters
covered hereby and shall supersede all previous written, oral or implied
understandings among them with respect to such matters.

     

    Section
15.  Amendments.  This Agreement may only be amended
or otherwise modified, and compliance with any provision hereof may only be
waived, by a writing executed by all of the parties hereto.  The
provisions of this Section 15 may only be amended or otherwise modified by such
a writing.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

     

    Section
16.  Effect on Change-in-Control
Agreement.  Notwithstanding anything else to the contrary in
this Agreement, if the Change-in-Control Agreement between the Company and the
Executive, to be dated as of March 30, 2010, becomes effective due to a
Change-in-Control of the Company (as defined therein), while the Executive
remains employed by the Company, this Agreement, including, without limitation,
Sections 7 and 8 hereof, shall no longer be effective in any respect but
instead the relationship between the Executive and the Company shall be governed
by the Change-in-Control Agreement.  If the Executive is terminated
prior to a Change-in-Control of the Company, then Sections 7 and 8 hereof shall
survive any Change-in-Control.

     

     

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Section
17.  Counterparts.  This Agreement may be executed in
any number of counterparts, each of which shall be deemed to be an original, and
all of which shall together be deemed to constitute one and the same
instrument.

     

    IN WITNESS WHEREOF, PGFC and
the Bank have caused this Agreement to be duly executed by the undersigned,
thereunto duly authorized, and the Executive has signed this Agreement, all as
of the date first written above.

     

    
      
        	
                WITNESS

              	 
      	
                PEAPACK-GLADSTONE
      FINANCIAL CORPORATION

              
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      /s/ Antoinette Rosell	 
      	
                By:

              	 
      /s/ Frank A. Kissel
	
                Secretary   
      Antoinette Rosell

              	 
      	 
      	Frank
      A. Kissel  
	 
      	 
      	 
      	 
      
	 
      	 
      	
                PEAPACK-GLADSTONE
      BANK

              
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      /s/ Antoinette Rosell	 
      	
                By:

              	 
      /s/ Frank A. Kissel
	
                Secretary   
      Antoinette Rosell

              	 
      	 
      	Frank
      A. Kissel  
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      
	 
      /s/ Bridget J. Walsh	 
      	 /s/
      Jeffrey J. Carfora 
	Bridget
      J. Walsh  	 
      	
                EXECUTIVE    
      Jeffrey J. Carfora

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