Document:

ex10-19.htm

 

 Exhibit 10.19

           

Field Point Capital Management Company

One Landmark Square, Suite 1900

Stamford, CT 06901

January 17, 2013

PASSUR Aerospace, Inc.

One Landmark Square, Suite 1900

Stamford, CT 06901

As Chairman of the Board, as well as the principal shareholder of PASSUR Aerospace, Inc. (“PASSUR Aerospace” or the “Company”), I make the following commitment to the Company with respect to the period from the date of this commitment through January 17, 2014.

Liquidity

I commit that if the Company at any time is unable to meet its obligations through January 17, 2014, that I will provide the necessary continuing financial support to the Company to ensure the Company’s ability to operate as a going concern through the period ending January 17, 2014. Such continuing support may take the form of additional loans or advances to PASSUR Aerospace, in addition to the deferral of principal and/or interest payments due on outstanding loans to PASSUR Aerospace as referred to above.

These commitments are not conditional and are irrevocable through the period ending January 17, 2014.

I, G.S. Beckwith Gilbert, having the financial wherewithal to enter into this irrevocable commitment, make the above commitments to the Company and its shareholders.

/s/ G.S. Beckwith Gilbert

G.S. Beckwith Gilbert

PresidentExhibit 10.1 

EMPLOYMENT AGREEMENT

          This
Employment Agreement (“Agreement”), dated as of January 28, 2013, is by
and between Lakeland Bancorp, Inc., a New Jersey corporation (“Lakeland
Bancorp”), Lakeland Bank, a New Jersey state chartered bank (“Lakeland Bank”
and, collectively with Lakeland Bancorp, the “Employer”) and Stewart E.
McClure, Jr., an individual residing at 90 Spring Hill Road, Mendham, New
Jersey 07945 (the “Executive”). 

RECITALS

          WHEREAS, Lakeland Bancorp and Somerset
Hills Bancorp, a New Jersey corporation (“Somerset”) have entered into that
certain Agreement and Plan of Merger dated as of January 28, 2013 (the “Merger
Agreement”) pursuant to which Somerset shall merge with and into Lakeland
Bancorp effective at the “Effective Time” as defined in such Merger Agreement
(the “Merger”); and 

          WHEREAS, following the Merger, the
Executive, who serves as, among other things, the President and Chief Executive
Officer of Somerset, desires to be employed by the Employer, and the Employer
desires to employ Executive, as Co-President of Lakeland Bank; and 

          WHEREAS, the parties desire to set forth
the terms pursuant to which the Executive will be employed by the Employer as
Co-President of Lakeland Bank; 

          NOW, THEREFORE, the Employer and the
Executive hereby agree as follows: 

          Section 1. Employment.
The Employer shall employ the Executive, and the Executive agrees to be
employed by the Employer, upon the terms and conditions hereinafter provided,
for a term commencing upon the closing of the Merger (the “Effective Date”)
and expiring on the second (2nd) anniversary of the Effective Date
(the “Initial Term”). Unless earlier terminated in accordance with
Section 5, this Agreement shall automatically be renewed for successive one (1)
year terms on each anniversary of the Effective Date (each a “Renewal Term”),
unless either party provides written notice to the other party not less than
ninety (90) days before each such anniversary of intent not to renew the
Agreement. The period during which Executive is employed under this Agreement
(including any Renewal Term) will be referred to as the “Term.” The
Executive hereby represents and warrants that the Executive has the legal
capacity to execute and perform this Agreement, that this Agreement is a valid
and binding agreement enforceable against the Executive according to its terms,
and that the execution and performance of this Agreement by the Executive does
not violate the terms of any existing agreement or understanding to which the
Executive is a party. Notwithstanding anything contained herein to the
contrary, this Agreement shall be without any force or effect on any party
unless and until the Merger is effective. In the event that the Merger
Agreement is terminated in accordance with its terms, this Agreement shall
terminate concurrently therewith and shall be without any force or effect on
any party as of any date. 

          Section 2. Duties.
The Executive shall report to the Chief Executive Officer and President of
Lakeland Bancorp and Chief Executive Officer and current President of Lakeland
Bank (the “CEO”), currently Thomas J. Shara, and shall have the title of
Co-President of Lakeland Bank (with the other Co-President being the Chief
Operating Officer of the Employer, Robert A. Vandenbergh) and shall be
responsible for the consumer lending and residential mortgage lending functions
of Lakeland Bank, the cash and wealth management functional areas, as well as
such other functional responsibility as assigned by the CEO. During the Term,
except for vacation in accordance with the provisions of this Agreement 

and the Employer’s policies or due to illness or incapacity, the
Executive shall devote all of the Executive’s business time, attention, skill
and efforts exclusively to the business and affairs of the Employer and its
affiliates. Notwithstanding the foregoing, to the extent that the following
does not impair the Executive’s ability to perform the Executive’s duties
pursuant to this Agreement, nor violate the terms of the provisions set forth
in Section 6 hereof, the Executive may (1) make personal investments in such
form or manner as will neither require the Executive’s services in the
operation or affairs of the business in which such investments are made, (2)
serve on the board of directors of one or more charitable organizations and (3)
serve on the board of directors of other companies with the advance written
consent of the Boards of the Employer in accordance with its Corporate
Governance Guidelines and Code of Ethics. 

          Section 3. Compensation.
For all services rendered by the Executive in any capacity required hereunder
during the Term, including, without limitation, services as an officer,
director, or member of any committee of the Employer or any parent, subsidiary,
affiliate or division thereof, the Executive shall be compensated as follows: 

          (a) The
Employer shall pay the Executive an initial fixed salary (“Base Salary”)
at a rate of $320,000 per annum from the Effective Date. Such Base Salary shall
be subject to periodic review and may be increased by the Employer in its
discretion. The term “Base Salary” as used in this Agreement shall refer
to the Base Salary as it may be increased from time to time. The Base Salary
shall be payable in accordance with the customary payroll practices of the
Employer. 

          (b) The
Executive shall participate in the executive bonus program as approved annually
by the Lakeland Bancorp Board. 

          (c) Except
as expressly modified by this Agreement, the Executive shall be entitled to
participate in all employee benefit plans or programs, including without
limitation the Employer’s 401(k) Plan and Profit Sharing Plan, and to receive
all benefits and perquisites, including without limitation an automobile, which
are approved by the CEO and are generally made available by the Employer to
executive officers of the Employer, to the extent permissible under the general
terms and provisions of such plans or programs and in accordance with the provisions
thereof. Notwithstanding the foregoing, nothing in this Agreement shall require
any particular plan or program to be continued nor preclude the amendment or
termination of any such plan or program, provided that such amendment or
termination is applicable generally to the executive officers of the Employer. 

          (d) The
Executive shall be entitled to five (5) weeks vacation for each 12-month period
during the Term. 

          (e) The
Employer shall pay or reimburse Executive for Executive’s reasonable annual
membership dues and business related expenses during the Term at the
Executive’s golf club and the Park Avenue Club. 

          Section 4. Business
Expenses. The Employer shall pay or reimburse the Executive for all
necessary expenses reasonably incurred by the Executive in connection with the
performance of the Executive’s duties and obligations under this Agreement,
subject to the Executive’s presentation of appropriate vouchers in accordance
with such expense account policies and approval procedures as the Employer may
from time to time reasonably establish for employees (including but not limited
to prior approval of extraordinary expenses); provided, however, that in no
event shall a reimbursement be made later than December 31 of the year following
the year in which the expense was incurred. 

          Section 5. Effect
of Termination of Employment. 

          (a) Termination
Generally. Notwithstanding anything herein to the contrary, this Agreement
may be terminated by either the Employer or the Executive, at any time, without
“Cause” or “Good Reason” (each as defined below); provided, however,
that the party desirous of terminating this Agreement shall give the other party at least ninety (90) days’ prior
written notice of such termination. The Employer may, in lieu of the notice
period, pay the Executive’s Base Salary for the notice period, provided,
however, that the Employer shall continue the Executive’s e-mail, voice mail
and secretarial support during such ninety (90) day period. The date specified
in any notice of termination as the Executive’s final day of employment shall
be referred to herein as the “Termination Date.” 

          (b) Accrued
Obligations. Except as set forth in this Section 5, in the event that
Executive’s employment hereunder is terminated for any reason, then Executive
shall be entitled to no compensation or other benefits of any kind whatsoever,
other than (i) payment of Executive’s earned but unpaid Base Salary under
Section 3(a), if any, and earned but unpaid bonus under Section 3(b), if any,
for the preceding year, each in accordance with Employer’s standard payroll
practices, (ii) payment for any unused accrued vacation or unpaid business
expenses, (iii) payment of any other unpaid amounts due and owing under any
benefit, fringe or equity plans, and (iv) the opportunity to continue health
coverage under the Employer’s group health plan in accordance with “COBRA” (“COBRA
Coverage”) (the foregoing payments and benefits are collectively referred
to herein as “Accrued Obligations”). 

          (c) Termination
Without Cause, Resignation for Good Reason, Termination Following a Change in
Control, Each During the Initial Term. 

	
  

 	
  

 
	
  

 	
           (1) In
 the event that the Employer terminates Executive’s employment hereunder
 during the Initial Term without “Cause” (defined below) or the Executive
 resigns during the Initial Term for “Good Reason” (defined below), then the
 Executive shall be entitled to no compensation or other benefits of any kind
 whatsoever, other than: (i) the Accrued Obligations, (ii) the No Change in
 Control Severance Amount (defined below) payable in substantially equal
 installments over a period of twelve (12) months in accordance with the
 Employer’s normal payroll practices, and (iii) all of the Executive’s
 Restricted Shares and stock options (to the extent not already vested) shall
 become fully vested, and the Executive shall be permitted to exercise any
 such option for the period specified in the Plan as in effect at such time. 

 
	
  

 	
  

 
	
  

 	
           (2) Notwithstanding
 the foregoing, if, during the Term and within ninety (90) days following a
 “Change in Control Event” (defined below), the Executive’s employment is
 terminated by the Employer without Cause or the Executive resigns for Good
 Reason, then, in lieu of the payments and benefits set forth in Section
 5(c)(1) above, the Executive shall receive (i) the Accrued Obligations, (ii)
 the “Change in Control Severance Amount” (defined below) payable within
 thirty (30) days following the Executive’s Termination Date, subject to
 Section 5(f) and Section 20 hereof, and (iii) all of the Executive’s
 Restricted Shares and stock options (to the extent not already vested) shall
 become fully vested, and the Executive shall be permitted to exercise any
 such option for the period specified in the Plan as in effect at such time. 

 
	
  

 	
  

 
	
  

 	
           (3) In
 addition to any amounts payable pursuant to Section 5(c)(1) or Section
 5(c)(2) above, if the Employer terminates Executive’s employment hereunder
 during the Initial Term without Cause or the Executive resigns during the
 Initial Term for Good Reason, then the Executive shall be entitled to a lump
 sum amount equal to the “Pre-Merger Change in Control Payment Amount”
 (defined below). Such lump sum amount shall be paid within thirty (30) days
 following the Executive’s Termination Date, subject to Section 5(f) and
 Section 20 hereof. 

 

          (d) Death
or Disability. The Executive’s employment with the Employer shall terminate
upon Executive’s death or “Disability” (defined below), in which case
the Executive (or his estate and 

heirs) shall be entitled to no compensation or other benefits of any
kind whatsoever under this Agreement for any period after the Executive’s date
of termination other than the Accrued Obligations. In addition, the Executive
(or his estate and heirs) shall be permitted to exercise any stock options (to
the extent vested as of the date of Executive’s termination of employment) for
up to twelve (12) months following such date of termination.

          (e) Options.
Except as otherwise set forth herein, any options held by the Executive as of
the Termination Date (to the extent vested as of the Termination Date) shall be
exercisable for the period specified in the Plan as in effect at such time. All
unvested Restricted Shares held by the Executive as of the Termination Date
shall be forfeited. 

          (f) Release.
All payments and benefits under this Section 5 (other than the Accrued
Obligations) shall be contingent upon Executive executing a general release of
claims in favor of the Employer, its subsidiaries and affiliates, and their
respective officers, directors, shareholders, partners, members, managers,
agents or employees, which release shall be provided to the Executive within
five (5) business days following the Termination Date, and which must be
executed by the Executive and become effective within thirty (30) days
thereafter. Severance payments under this Section 5 that are contingent upon
such release shall, subject to Section 20, commence within ten (10) days after
such release becomes effective; provided, however, that if Executive’s
Termination Date occurs on or after November 15 of a calendar year, then
severance payments shall, subject to the effectiveness of such release and
Section 20, commence on the first business day of the following calendar year. 

          (g) Termination
With Cause. The Employer may terminate this Agreement immediately for
“Cause” by giving written notice to the Executive. In the event that this
Agreement is terminated pursuant to this Section 5(g), the Executive shall be
entitled to no compensation or other benefits of any kind whatsoever for any
period after the Termination Date set forth in the notice given by the Employer
to the Executive, except for the Accrued Obligations. All unexercised stock
options and unvested Restricted Shares held by the Executive as of the
Termination Date shall be forfeited. 

          (h) Definitions.

                    (i)
“Cause” shall mean: (1) the Executive’s gross negligence in the performance of
the material responsibilities of his office or position; (2) the Executive’s
gross or willful misconduct in the performance of the material responsibilities
of his office or position; (3) material failure or refusal by the Executive to
perform his duties, as such may be reasonably assigned to him from time to
time, other than by reason of his disability, or other acts or omissions
constituting material neglect or dereliction of his duties; (4) any conviction
by a court of law of, or entry of a pleading of guilty or nolo contendre by
Executive with respect to a felony; (5) the Executive’s embezzlement or
intentional misappropriation of any property of the Employer (other than good
faith expense account disputes); (6) the Executive’s breach of Section 6 of
this Agreement; (7) fraud, dishonesty or other acts or omissions by the
Executive that constitute a willful breach of his fiduciary duty to the
Employer; (8) the Executive’s use of alcohol or drugs which materially
interferes with the performance of his duties hereunder; or (9) the Executive’s
use of alcohol or drugs which materially compromises the integrity and
reputation of the Employer, or that of its employees, services or products. For
purposes of this definition, an act or failure to act shall be considered
“willful” only if done or omitted to be done without a good faith reasonable
belief that such act or failure to act was in the best interests of the
Employer. The Executive shall be given notice of the termination of his
employment for Cause. If the Executive shall be terminated pursuant to clause
(1), (2), (3), (6) or (8) above, the Executive shall be given thirty (30) days
to cure the matter (if curable). In all other cases, termination shall be
effective as of the date notice is given. 

                    (ii)
“Change in Control Event” shall be deemed to have occurred if any of the 

following events occur: 

                         (a)
the consummation of any consolidation or merger of Lakeland Bancorp in which
Lakeland Bancorp is not the continuing or surviving corporation or pursuant to
which shares of Common Stock would be converted into cash, securities or other
property, other than a merger of Lakeland Bancorp in which the holders of the
shares of Lakeland Bancorp’s Common Stock immediately prior to the merger have
the same proportionate ownership of common stock of the surviving corporation
immediately after the merger; or

                         (b)
the consummation of any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all, or substantially all,
of the assets of Lakeland Bancorp, other than to a subsidiary or affiliate; or 

                         (c)
any action pursuant to which any person (as such term is defined in Section 13(d)
of the Securities Exchange Act of 1934 (the “Exchange Act”)), corporation or
other entity (other than any person who owns more than ten percent (10%) of the
outstanding Common Stock on the date on which this Agreement is first entered
into) shall become the “beneficial owner” (as such term is defined in Rule
13d-3 under the Exchange Act), directly or indirectly, of shares of capital
stock entitled to vote generally for the election of directors of Lakeland
Bancorp (“Voting Securities”) representing fifty-one (51%) percent or more of
the combined voting power of Lakeland Bancorp’s then outstanding Voting
Securities (calculated as provided in Rule 13d-3(d) in the case of rights to
acquire any such securities), unless, prior to such person so becoming such
beneficial owner, the Board shall determine that such person so becoming such
beneficial owner shall not constitute a Change in Control; or 

                         (d)
the individuals (A) who, as of the date on which this Agreement is first
entered into, constitute the Board (the “Original Directors”) and (B) who
thereafter are elected to the Board and whose election, or nomination for
election, to the Board was approved by a vote of at least two thirds of the
Original Directors then still in office (such Directors being called
“Additional Original Directors”) and (C) who thereafter are elected to the
Board and whose election or nomination for election to the Board was approved
by a vote of at least two thirds of the Original Directors and Additional Original
Directors then still in office, cease for any reason to constitute a majority
of the members of the Board. 

          Notwithstanding
the foregoing, none of the events described in (a) through (d) above shall
constitute a Change in Control Event unless such event is considered either a
“change in the ownership” of Lakeland Bancorp, a “change in the effective
control” of Lakeland Bancorp or a “change in the ownership of a substantial
portion of the assets” of Lakeland Bancorp within the meaning of Treasury
Regulation Sections 1.409A-3(i)(5)(v), (vi) or (vii), respectively. 

                    (iii)
“Disability” shall mean that Executive is incapable of performing his principal
duties due to physical or mental incapacity or impairment for 180 consecutive
days, or for 240 non-consecutive days, during any 12 month period. 

                    (iv)
“Good Reason” shall mean (a) a material adverse reduction in the Executive’s
duties and responsibilities without his consent, or a reduction in the
Executive’s title or positions (other than during any period of illness or
disability); (b) a material breach by the Employer of a material term of this
Agreement, (c) the relocation of the Executive’s principal office location,
without the Executive’s consent, to a location that is anywhere outside of a 30
mile radius of Employer’s offices, or (d) any reduction, without the
Executive’s consent, of the Executive’s Base Salary. No event described in
clauses (a) through (d) above shall constitute “Good Reason” unless the Executive
provides the Board with written notice of the Executive’s objection to such
event within thirty (30) days after such event first 

occurs, and the Employer is afforded an opportunity to cure within
thirty (30) days after the Board’s receipt of such notice. 

                    (v)
“Change in Control Severance Amount” shall mean an amount equal to the
excess of (i) two (2) times the sum of (a) an amount equal to the Executive’s
annual Base Salary at the rate in effect as of the Executive’s Termination
Date, plus (b) an amount equal to the average cash bonuses paid to the
Executive by the Employer during the two (2) years prior to the Executive’s
Terminate Date, over (ii) the Pre-Merger Change in Control Payment Amount. 

                    (vi)
“No Change in Control Severance Amount” shall mean an amount equal to
the excess of (i) 150% of the annual Base Salary in effect immediately prior to
the Executive’s Termination Date, over (ii) the Pre-Merger Change in Control Payment Amount. 

                    (vii)
“Pre-Merger Change in Control Payment Amount” shall mean the excess of
(i) the maximum amount payable under Section 7.7(b) of the “Prior Employment
Agreement” (defined below), over (ii) $837,000, which is the amount payable to
Executive under Section 7.7(b) of the Prior Employment Agreement in connection
with the Merger. For clarity, the maximum amount payable under Section 7.7(b)
of the Prior Employment Agreement is equal to the sum of three times
Executive’s base salary with Somerset in effect immediately before the Merger
and three times the bonus Executive received from Somerset in the year
preceding the Merger, subject to the limitations set forth in the Third
Amendment Agreement, dated January 16, 2009, to the Prior Employment Agreement. 

                    (viii)
“Prior Employment Agreement” means the Employment Agreement between Somerset
Hills Bancorp and Executive dated March 8, 2001, as amended May 15, 2003,
September 26, 2007 and January 16, 2009 (referenced as Exhibit 10.5 to the
Annual Report on Form 10-K of Somerset for the 2011 fiscal year). 

          (i) No
Mitigation. In no event shall the Executive be obligated to seek other
employment or take any other action by way of mitigation of the amounts payable
to the Executive under any of the provisions of this Agreement. 

          Section 6. Confidentiality
and Covenants Against Competition, Solicitation, Disparagement.

          (a) The
Executive agrees that his services hereunder are of a special, unique,
extraordinary and intellectual character, and his position with the Employer
places him in a position of confidence and trust with employees, customers, and
suppliers of the Employer. The Executive further agrees and acknowledges that
in the course of the Executive’s employment with the Employer, the Executive
has been and will be privy to confidential information of the Employer. The
Executive consequently agrees that it is reasonable and necessary for the
protection of the trade secrets, goodwill and business of the Employer that the
Executive make the covenants contained herein. Accordingly, the Executive
agrees that while employed by the Employer and during the “Restrictive Period”
(defined below), the Executive shall not (without the express prior written
consent of the Employer), anywhere in the world, directly or indirectly, 

	
  

 	
  

 
	
  

 	
           (i)
 become Associated With any Competing Business in the Territory; or 

 
	
  

 	
  

 
	
  

 	
           (ii)
 solicit, sell, call upon or induce others to solicit, sell or call upon,
 directly or indirectly, any customer or prospective customer of the Employer
 for the purpose of inducing any such customer or prospective customer to
 purchase, license or lease a product or service of a Competing Business in
 the Territory; or 

 

	
  

 	
  

 
	
  

 	
           (iii)
 employ, solicit for employment, or advise or recommend to any other person
 that they employ or solicit for employment or retention as a consultant, any
 person who is, or was at any time within twelve (12) months prior to the last
 day of Executive’s employment with the Employer, an employee of, or exclusive
 consultant to, the Employer. 

 

          (b) For
purposes of this Section 6, the term:

	
  

 	
  

 
	
  

 	
           (i) “Employer”
 shall include the Employer, and any of its subsidiaries or affiliates. 

 
	
  

 	
  

 
	
  

 	
           (ii) “Competing
 Business” means that portion or segment of the business of any person,
 corporation or other entity which, directly or indirectly, engages in
 providing financial services or advice or takes deposits or makes loans. 

 

	
  

 	
  

 
	
  

 	
           (iii) “Associated
 With” means serving as an owner, officer, employee, independent
 contractor, agent or a holder of 5% or more of any class of equity securities
 of, director, trustee, member, consultant or partner of any person,
 corporation or other entity engaged in a Competing Business. 

 
	
  

 	
  

 
	
  

 	
           (iv) “Restrictive
 Period” means the twelve (12) month period commencing from the
 Executive’s date of termination with the Employer. 

 
	
  

 	
  

 
	
  

 	
           (v) “Territory”
 means a geographic area equal to 20 miles from any of the Employer’s branches
 at the time of Executive’s termination of employment. 

 

          (c) If the
Executive commits a breach or is about to commit a breach, of any of the
provisions of this Section 6, the Employer shall have the right to have the
provisions of this Agreement specifically enforced by any court having equity
jurisdiction without being required to post bond or other security and without
having to prove the inadequacy of the available remedies at law, it being
acknowledged and agreed that any such breach or threatened breach will cause
irreparable injury to the Employer and that money damages will not provide an
adequate remedy to the Employer. In addition, the Employer may take all such
other actions and remedies available to it under law or in equity and shall be
entitled to such damages as it can show it has sustained by reason of such
breach. 

          (d)
Executive shall not make any negative or disparaging comments regarding the
Employer or its subsidiaries or affiliates, or any of their respective officers,
directors, shareholders, partners, members, managers, agents or employees
(collectively, the “Representatives”), including regarding the performance of
the Employer or such subsidiaries or affiliates, or otherwise take any action
that could reasonably be expected to adversely affect the Employer or its
subsidiaries or affiliates or the personal or professional reputation of any of
their respective Representatives; and the Employer and its Representatives
shall not make any negative or disparaging comments regarding Executive, or
otherwise take any action that could reasonably be expected to adversely affect
the personal or professional reputation of Executive. Disclosure of information
required to be disclosed by either party pursuant to any applicable law, court
order, subpoena, compulsory process of law, or governmental decree shall not
constitute a violation or breach of this Section 6(d); provided, that the
disclosing party delivers written notice of such required disclosure to the
other parties promptly before making such disclosure if such notice is not
prohibited by applicable law, court order, subpoena, compulsory process of law,
or governmental decree.  

          (e) The
Executive further agrees that all documents, reports, plans, proposals, marketing
and sales plans, customer lists, or materials principally relating to the
businesses of the Employer or any of its subsidiaries or affiliates and made by
the Executive or that came or come into the Executive’s possession 

by reason of the Executive’s employment by the Employer are the
property of such entities and shall not be used by the Executive in any way
adverse to the interests of the Employer or any of its subsidiaries or
affiliates. The Executive will not, during the Term and thereafter, deliver,
reproduce or in any way allow such documents or things to be delivered or used
by any third party without specific direction or consent of a duly authorized
representative of the Employer. During or after termination of the Executive’s
employment with the Employer, the Executive will not publish, release or
otherwise make available to any third party any information describing any
trade secret or other confidential information of the Employer without prior
specific written authorization of the Employer. 

          (f) During
the Term and thereafter, the Executive will regard and preserve as confidential
all trade secrets and other confidential information pertaining to the business
of the Employer that have been or may be obtained by the Executive by reason of
the Executive’s employment by the Employer. The Executive will not, without
written authority from the Employer to do so, use for the Executive’s own
benefit or purposes, nor disclose to others, either during the Executive’s
employment by the Employer or thereafter any trade secret or other confidential
information relating to the business of the Employer, except as required in the course of the Executive’s employment with the
Employer, or as required by law, or as (and only to the extent) required
pursuant to legal process or by an order of a court having competent
jurisdiction or under subpoena from an appropriate government agency (and then
only after providing the Employer with the opportunity to prevent such
disclosure or to receive confidential treatment for the confidential
information required to be disclosed); and the Executive will not take or
retain or copy any of the information, customer lists, or other documents of
the Employer. This Section 6(f) shall not apply with respect to information
which has been voluntarily disclosed to the public by or with the consent of
the Employer, independently developed and disclosed by others, or otherwise
enters the public domain through lawful means. 

          (g) For
purposes of this Agreement, the term “trade secret” shall include, but not be
limited to, information encompassed in all plans, proposals, marketing and
sales plans, customer lists, mailing lists, financial information, costs,
pricing information, and all concepts or ideas in or reasonably related to the
businesses of the Employer (whether or not divulged by the Executive or other
employees or agents of the Employer) that have not previously been publicly
released by duly authorized representatives of the Employer. 

          (h) Executive
acknowledges that the type and periods of restriction imposed in the provisions
of this Section 6 are fair and reasonable and are reasonably required for the
protection of the Employer and the goodwill associated with the business of the
Employer; and that the time, scope, geographic area and other provisions of
this Section 6 have been specifically negotiated by sophisticated parties and
are given as an integral part of this Agreement. The Executive specifically
acknowledges that the restrictions contemplated by this Agreement will not
prevent him from being employed or earning a livelihood. If any of the
covenants in this Section 6, or any part thereof, is hereafter construed to be
invalid or unenforceable, the same shall not affect the remainder of the
covenants, which shall be given full effect, without regard to the invalid
portions. If any of the covenants contained in this Section 6, or any part
thereof, is held to be unenforceable because of the duration of such provision
or the area covered thereby, the parties agree that the court making such
determination shall have the power to reduce the duration and/or areas of such
provision and, in its reduced form, such provision shall then be enforceable.
The parties hereto intend to and hereby confer jurisdiction to enforce the
covenants contained in this Section 6 upon the courts of any state or other
jurisdiction within the geographical scope of such covenants. In the event that
the courts of any one or more of such states or other jurisdictions shall hold
such covenants wholly unenforceable by reason of the breadth of such scope or
otherwise, it is the intention of the parties hereto that such determination
not bar or in any way affect the right of the Employer to the relief provided
above in the courts of any other states or other jurisdictions within the
geographical scope of such covenants, as to breaches of such covenants in such
other respective states or other jurisdictions, the 

above covenants as they relate to each state or other jurisdiction being,
for this purpose, severable into diverse and independent covenants. The
existence of any claim or cause of action by the Executive against the Employer
shall not constitute a defense to the enforcement by the Employer of the
foregoing restrictive covenants, but such claim or cause of action shall be
determined separately. 

          (i) The
Executive further agrees that a copy of a summons and complaint seeking the
entry of such order may be served upon the Executive by certified mail, return
receipt requested, at the address set forth above or at any other address which
the Executive shall designate in a writing addressed to the Employer in the
manner that notices are to be addressed pursuant to Section 9 of this
Agreement. 

          Section 7. Assignment
of Developments; Works for Hire. If at any time or times during Executive’s
employment with the Employer, the Executive shall (either alone or with others)
make, conceive, discover or reduce to practice any invention, modification,
discovery, design, development, improvement, process, software program,
work-of-authorship, documentation, formula, data, technique, know-how, secret
or intellectual property right whatsoever or any interest therein (whether or
not patentable or registrable under copyright or similar statutes or subject to
analogous protection) (herein called “Developments”) that (a) relates to the
business of the Employer (or any subsidiary or affiliate of the Employer) or any customer of or supplier to the Employer (or any of
its subsidiaries or affiliates) or any of the products or services being
developed, manufactured, sold or provided by the Employer or which may be used
in relation therewith or (b) results from tasks assigned to the Executive by
the Employer, such Developments and the benefits thereof shall immediately
become the sole and absolute property of the Employer and its assigns, and the
Executive shall promptly disclose to the Employer (or any persons designated by
it) each such Development and hereby assigns any rights the Executive may have
or acquire in the Developments and benefits and/or rights resulting therefrom
to the Employer and its assigns without further compensation and shall
communicate, without cost or delay, and without publishing the same, all
available information relating thereto (with all necessary documentation, plans
and models) to the Employer. Upon disclosure of each Development to the
Employer, the Executive will, during the Term and at any time thereafter, at
the request and cost of the Employer, sign, execute, make and do all such
deeds, documents, acts and things as the Employer and its duly authorized
agents may reasonably require:  

          (a) to
apply for, obtain and vest in the name of the Employer alone (unless the
Employer otherwise directs) letters patent, copyrights, trademarks, service
marks or other analogous protection in any country throughout the world and
when so obtained or vested to renew and restore the same; and 

          (b) to
defend any opposition proceedings in respect of such applications and any
opposition proceedings or petitions or applications for revocation of such
letters patent, copyrights, trademarks, service marks or other analogous
protection. 

          In the
event the Employer is unable, after reasonable effort, to secure the
Executive’s signature on any letters patent, copyrights, trademarks, service
marks or other analogous protection relating to a Development, whether because
of the Executive’s physical or mental incapacity or for any other reason
whatsoever, the Executive hereby irrevocably designates and appoints the
Employer and its duly authorized officers and agents as the executive’s agent
and attorney-in-fact, to act for and on his behalf and stead to execute and
file any such application or applications and to do all other lawfully
permitted acts to further the prosecution and issuance of any such letters
patent, copyrights, trademarks, service marks and other analogous protection
thereon with the same legal force and effect as if executed by the Executive. 

          Section
8. Withholding Taxes. The Employer may directly or indirectly withhold
from any payments to be made under this Agreement all Federal, state, city or
other taxes and all other deductions

as shall be required pursuant to any law or governmental regulation or
ruling or pursuant to any contributory benefit plan maintained by the Employer.

          Section 9. Notices.
All notices, requests, demands and other communications required or permitted
hereunder shall be given in writing, and shall be deemed effective upon (a)
personal delivery, if delivered by hand, (b) three (3) days after the date of
deposit in the mails, postage prepaid, if mailed by certified or registered
United States mail, or (c) the next business day, if sent by a prepaid overnight
courier service, and in each case addressed as follows: 

	
  

 	
  

 
	
  

 	
 (a) To the Employer: 

 
	
  

 	
  

 
	
  

 	
 Lakeland Bancorp, Inc. 250 Oak Ridge Road Oak Ridge, New Jersey 07438
Attention: Chief Executive Officer 

 
	
  

 	
  

 
	
  

 	
 with a copy in the same manner simultaneously (which shall not be
 deemed notice) to:
Office of General Counsel, 250 Oak Ridge Road Oak Ridge,
 New Jersey 07438 

 
	
  

 	
  

 
	
  

 	
 (b) To the Executive: 

 

	
  

 	
  

 
	
  

 	
 to the Executive at the Executive’s address listed above.

 
	
  

 	
  

 
	
  

 	
 with a copy (which shall not be deemed notice) to: 

 
	
  

 	
  

 
	
  

 	
 Robert Schwartz, Esq. 

 
	
  

 	
 Windels Marx Lane & Mittendorf, LLP 

 
	
  

 	
 120 Albany Street Plaza, New Brunswick, NJ 08901 

 

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

          Section 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 effect any such action shall
be null, void and of no effect; provided, however, that nothing in this Section
10 shall preclude the assumption of such rights by executors, administrators or
other legal representatives of the Executive or the Executive’s estate and
their assigning any rights hereunder to the person or persons entitled thereto.

          Section 11.
Binding Agreement; No Assignment. This Agreement shall be binding upon,
and shall inure to the benefit of, the Executive, the Employer and their
respective permitted successors, assigns, heirs, beneficiaries and
representatives. This Agreement is personal to the Executive and may not be
assigned by the Executive without the prior written consent of the Board, as
evidenced by a resolution of the Board. Any attempted assignment in violation
of this Section 11 shall be null and void. 

          Section 12.
Governing Law; Consent to Jurisdiction; Arbitration. This Agreement, and
all matters arising directly or indirectly from this Agreement, shall be
governed by, and construed and interpreted in accordance with, the laws of the
State of New Jersey, without giving effect to the choice of law provisions
thereof. Any unresolved controversy or claim arising out of or relating to this
Agreement, except (i) as otherwise provided in this Agreement or (ii) with
respect to which a party seeks injunctive or other equitable relief, shall be
submitted to arbitration by one arbitrator pursuant to the Commercial
Arbitration Rules of the American Arbitration Association (the “AAA”). Judgment
upon any award rendered in such arbitration will be binding and may be entered
in any court having jurisdiction thereof.  

The parties agree that the arbitrator in any such matter shall be
directed to award reasonable attorneys’ fees to the prevailing party. The
arbitrator shall also be directed to award the arbitrator’s compensation
charges and the administrative fees of the AAA to the prevailing party. The
parties knowingly and voluntarily agree to this arbitration provision and
acknowledge that arbitration shall be instead of any civil litigation, meaning
that the parties each are waiving any rights to a jury trial. Each of the
parties to this Agreement consents to personal jurisdiction and venue for any
equitable action sought in the United States District Court for the District of
New Jersey and any state court of competent jurisdiction in the State of New
Jersey that is located in Passaic County (and in the appropriate appellate
courts from any of the foregoing). Notwithstanding the foregoing, the Executive
and the Employer agree that, prior to submitting a dispute under this Agreement
to arbitration, the parties shall submit, for a period of sixty (60) days, to
voluntary mediation before a jointly selected neutral third party mediator
under the auspices of JAMS, New York City, New York, Resolution Center (or any
successor location), pursuant to the procedures of JAMS International Mediation
Rules conducted in the State of New York (however, such mediation or obligation
to mediate shall not suspend or otherwise delay any termination or other action
of the Employer or affect any other right of the Employer).  

          Section 13.
Entire Agreement. This Agreement shall constitute the entire agreement
between the parties with respect to the matters covered hereby and supersedes
all previous written, oral or implied understandings between them with respect
to such matters, including without limitation the Prior Employment Agreement
(except to the extent that reference to the Prior Employment Agreement is
required for the purposes of Section 5(c) hereof).

          Section 14.
Amendments. This Agreement may only be amended or otherwise modified by
a writing executed by each of the parties hereto. 

          Section 15.
Survivorship. The provisions of Sections 5 through 13 hereof and this
Section 15 shall survive the termination of this Agreement. 

          Section 16.
Indemnification. The Employer shall indemnify, defend and hold the
Executive harmless for actions and omissions as an officer and/or director of
the Employer to the extent set forth in the Employer’s By-laws and/or
Certificate of Incorporation, as applicable. The Employer agrees that the Executive
shall be covered by directors and officers insurance coverage during the Term
on the same basis as the Employer maintains such coverage for other officers
and directors of the Employer. 

          Section 17.
Key Man Life Insurance. If requested by the Employer, the Executive
agrees to cooperate with the Employer in obtaining any key man life insurance
or such other coverage insuring the Executive’s life and to submit to such
physical examinations as may be needed to secure such coverage. 

          Section 18.
Counterparts. This Agreement may be executed in any number of
counterparts or facsimile copies, each of which when executed shall be deemed
to be an original and all of which together shall be deemed to be one and the
same instrument. 

          Section 19.
Legal Counsel. The Executive represents that he is knowledgeable and
sophisticated as to business matters, including the subject matter of this
Agreement, that he has read this Agreement and that he understands its terms.
The Executive acknowledges that, prior to assenting to the terms of this
Agreement, he has been given a reasonable period of time to review it, to
consult with counsel of his choice, and to negotiate at arm’s-length with the
Employer as to its contents. The Executive and the Employer agree that the
language used in this Agreement is the language chosen by the parties to
express their mutual intent, and that they have entered into this Agreement
freely and voluntarily and without pressure or coercion from anyone. 

          Section 20.
Section 409A. This Agreement shall be interpreted to avoid any penalty
sanctions under Section 409A of the Code (“Section 409A”) and regulations
promulgated thereunder. Notwithstanding anything contained herein to the
contrary, the Executive shall not be considered to have terminated employment
with the Employer for purposes of the payments and benefit of Section 5 hereof
unless he would be considered to have incurred a “termination of employment”
from the Employer within the meaning of Treasury Regulation
§1.409A-1(h)(1)(ii). For purposes of Section 409A, each payment made under this
Agreement shall be treated as a separate payment. In no event may the
Executive, directly or indirectly, designate the calendar year of payment.
Notwithstanding the foregoing, if necessary to comply with the restriction in
Section 409A(a)(2)(B) of the Code concerning payments to “specified employees”,
any payment as a result of the termination of the Executive’s employment that
would otherwise be due hereunder within six months after such termination of
employment shall nonetheless be delayed until the first business day of the
seventh month following the Executive’s date of termination and the first such
payment shall include the cumulative amount of any payments that would have
been paid prior to such date if not for such restriction. 

          Section 21.
Section 280G Limitation. If any payment(s) or benefit(s) Executive would
receive pursuant to this Agreement and/or pursuant to any other agreement or
arrangement would (i) constitute a “parachute payment” within the meaning of
Section 280G of the Code, and (ii) but for this section, be subject to the
excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then
such payment(s) or benefit(s) (collectively, “Payments”) shall be
reduced to the Reduced Amount. The “Reduced Amount” shall be the largest
portion of the Payments that can be paid or provided without causing any
portion of the Payments being subject to the Excise Tax. If a reduction in
payments or benefits constituting “parachute payments” is necessary so that the
Payments equal the Reduced Amount, reduction shall occur in the following
order: (a) first, severance payments under this Agreement, (b) second, any
other cash payments due under any other agreement between the Company and
Executive; (c) third, cancellation of the acceleration of vesting of any stock
options, (d) fourth, cancellation of the acceleration of vesting of any
restricted stock and restricted stock units; and (e) lastly, other non-cash
forms of benefits. Calculations of the foregoing will be performed at the
expense of the Company by an accounting firm selected by the Company. The
determinations of such accounting firm shall be final, binding and conclusive
upon the Company and Executive. 

[Signature Page Follows]

          IN WITNESS
WHEREOF, the Employer has caused this Agreement to be executed and delivered by
its duly authorized officer and the Executive has signed this Agreement, all as
of the first date written above. 

	
  

 	
  

 	
  

 	
  

 
	
  

 	
 LAKELAND
 BANCORP, INC.

 
	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
      /s/ Thomas J. Shara

 	
  

 
	
  

 	
  

 	 

 	
  

 
	
  

 	
  

 
	
  

 	
 Thomas J.
 Shara

 
	
  

 	
 President
 and Chief Executive Officer

 
	
  

 	
  

 	
  

 
	
  

 	
 LAKELAND
 BANK

 
	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
      /s/
 Thomas J. Shara

 	
  

 
	
  

 	
  

 	 

 	
  

 
	
  

 	
  

 
	
  

 	
 Thomas J.
 Shara

 
	
  

 	
 President
 and Chief Executive Officer

 
	
  

 	
  

 	
  

 
	
  

 	
 EXECUTIVE:

 
	
  

 	
  

 	
  

 
	
  

 	
 /s/ Stewart
 E. McClure, Jr.

 
	
  

 	 

 	
  

 
	
  

 	
 Stewart E.
 McClure, Jr.

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