Document:

ex10-3.htm

    

      Exhibit
10.3

      

       

      FORM
OF SENIOR EXECUTIVE OFFICER AGREEMENT

       

      [PEAPACK-GLADSTONE
FINANCIAL CORPORATION 
LETTERHEAD]

       

      January
___, 2009

       

      [Officer
Name]

      Peapack-Gladstone
Financial Corporation

      158 Route
206 North

      P.O. Box
178

      Gladstone,
NJ    07934

       

      Dear
[Officer Name],

       

      As you
know, Peapack-Gladstone Financial Corporation (the “Company,” as further defined
below) has entered into a Securities Purchase Agreement, dated January 9, 2009
(the “Participation Agreement”), with the United States Department of Treasury
(“Treasury”) that provides for the Company’s participation in the Treasury’s
TARP Capital Purchase Program (“CPP”).

       

      For the
Company to participate in the CPP, and as a condition to the closing of the
investment contemplated by the Participation Agreement, the Company is required
to establish specified standards for incentive compensation to its senior
executive officers and to make changes to its compensation
arrangements.  To comply with these requirements, and in consideration
of the benefits that you will receive as a result of the Company’s participation
in the CPP, you agree as follows:

       

      (1)                No Golden Parachute
Payments.  The Company is prohibiting any golden parachute
payments to you during any “CPP Covered Period”.  A “CPP Covered
Period” is any period during which (A) you are a senior executive officer of the
Company, and (B) Treasury holds an equity or debt position acquired from the
Company in the CPP.

       

      (2)                Recovery of Bonus and
Incentive Compensation.  Any bonus and/or incentive
compensation paid to you during a CPP Covered Period is subject to recovery or
“clawback” by the Company if the payments were based on materially inaccurate
financial statements or any other materially inaccurate performance metric
criteria.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

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

       

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

       

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

       

      “Senior
executive officer” means the Company’s “senior executive officers” as defined in
Subsection 111(b)(3) of EESA.

       

      “Golden
parachute payment” has the same meaning as in Subsection 111(b)(2)(C) of
EESA.

       

      “EESA”
means the Emergency Economic Stabilization Act of 2008 as implemented by
guidance or regulation that has been issued and is in effect as of the “Closing
Date,” as defined in the Participation Agreement.

       

      The term
“Company” includes any entities treated as a single employer with the Company
under 31 C.F.R. § 30.1(b) (as in effect on the Closing Date).  You are
also delivering a waiver pursuant to the Participation Agreement, and, as
between the Company and you, the term “employer” in that waiver will be deemed
to mean the Company as used in this letter.

       

      The term
“CPP Covered Period” shall be limited by, and interpreted in a manner consistent
with, 31 C.F.R. § 30.11 (as in effect on the Closing Date).

       

      Provisions
(1) and (2) of this letter are intended to, and will be interpreted,
administered and construed to comply with Section 111 of EESA and, to the
maximum extent consistent with the preceding, to permit operation

       

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

      of the
Benefit Plans in accordance with their terms before giving effect to this
letter.

       

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

       

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

       

      
        
          
            
              
                	
                        Very
      truly yours,

                         

                      
	
                        Peapack-Gladstone
      Financial Corporation

                      
	 
      	 
      
	 
      	 
      
	
                        By:

                      	 
      
	
                        Name:

                      	 
      
	
                        Title:

                      	 
      

              

            

             

          

        

      

      Intending
to be legally bound, I hereby

      agree
with, acknowledge the sufficiency

      of
consideration for, and accept the foregoing terms.

       

      _________________________________

      [Officer
Name]

      Dated:    January
___, 2009

      

       

      3Exhibit 4-1(a)

                             STATE OF SOUTH CAROLINA
                               SECRETARY OF STATE

                              ARTICLES OF AMENDMENT

TYPE OR PRINT CLEARLY IN BLACK INK

Pursuant Section  33-10-106 of the 1976 South Carolina Code of Laws, as amended,
the undersigned  corporation  adopts the following  Articles of Amendment to its
Articles of Incorporation:

1.   The name of the corporation is GrandSouth Bancorporation

2.   Date of Incorporation  June 7, 2000

3.   Agent's Name and Address Ronald K. Earnest, 381 Halton,  Road,  Greenville,
     SC 29607

4.   On January 5, 2009, the corporation  adopted the following  Amendment(s) of
     its Articles of  Incorporation:  (Type or attach the complete  text of each
     Amendment)

     See Text of Amendment to Articles of Incorporation attached hereto.

5.   The  manner,  if not set forth in the  Amendment,  in which  any  exchange,
reclassification, or cancellation of issued shares provided for in the Amendment
shall be effected, is as follows: (if not applicable, insert "not applicable" or
"NA").

6.   Complete either "a" or "b," whichever is applicable.

     a.   [x]  Amendment(s) adopted by shareholder action.

               At the  date of  adoption  of the  Amendment(s),  the  number  of
               outstanding   shares  of  each  voting  group  entitled  to  vote
               separately on the Amendment(s), and vote of such shares was:

<TABLE>
<CAPTION>
                                Number of              Number of            Number of Votes         Number of Undisputed
         Voting                Outstanding           Votes Entitled         Represented at                 Shares
         Group                   Shares                to be Cast             the Meeting              For or Against
         -----                   ------                ----------             -----------              --------------
<S>     <C>                      <C>                   <C>                   <C>                     <C>        <C>

        Common                   3,565,964             3,565,964             2,497,249               2,483,073  13,777

</TABLE>

<PAGE>
                                               GrandSouth Bancorporation
                                               ---------------------------------
                                                  Name of Corporation

        Note:  Pursuant to Section  33-10-106(6)(i),  of the 1976 South Carolina
               Code of Laws, as amended, the corporation can alternatively state
               the total  number of disputed  shares cast for the  amendment  by
               each voting group  together with a statement that the number cast
               for the  amendment  by  each  voting  group  was  sufficient  for
               approval by that voting group.

b.       [ ]   The Amendment(s)  was duly adopted by the  incorporators or board
               of directors  without  shareholder  approval pursuant to Sections
               33-6-102(d),  33-10-102 and 33-10-105 of the 1976 South  Carolina
               Code  of  Laws,  as  amended,  and  shareholder  action  was  not
               required.

7.   Unless a delayed dated is specified,  the effective  date of these Articles
of  Amendment  shall be the date of  acceptance  for filing by the  Secretary of
State (See  Section  33-1-230(b)  of the 1976 South  Carolina  Code of Laws,  as
amended) _______________________________________________________________________

Date January 5, 2009
     ----------------------             GrandSouth Bancorporation
                                        ----------------------------------------
                                        Name of Corporation

                                        s/Ronald K. Earnest, President
                                        ----------------------------------------
                                        Signature

                                        Ronald K. Earnest, President
                                        ----------------------------------------
                                        Type or Print Name and Office

                               FILING INSTRUCTIONS

1. Two copies of this form, one of which can be either a duplicate original or a
conformed copy, must be filed.

2. If the space in this form is insufficient,  please attach  additional  sheets
containing a reference to the appropriate paragraph in this form.

3. Filing  fees and taxes  payable to the  Secretary  of State at time of filing
application.

         Filing Fee                                      $  10.00
         Filing Tax                                        100.00
                                                           ------
         Total                                           $ 110.00

         Return to:        Secretary of State
                           PO Box 11350
                           Columbia, SC 29211

DOM-ARTICLES OF AMENDMENT                       FORM REVISED BY SOUTH CAROLINA
                                                SECRETARY OF STATE, JANUARY 2000

<PAGE>

                            GRANDSOUTH BANCORPORATION

                  Text of Amendment to Articles of Incorporation

         Article 3 of the Articles of Incorporation of GrandSouth Bancorporation
is amended to read as follows:

         3. The  corporation  is authorized to issue shares of stock as follows.
Complete a or b whichever is applicable:

         a. /_/ The corporation is authorized to issue a single class of shares,
and the total number of shares authorized is _____________________.

         b. /X/ The  corporation  is  authorized to issue more than one class of
shares:

                  Class of Shares              Authorized No. of Each Class

                  Common Stock                          20,000,000

                  Preferred Stock                       20,000,000

         The relative rights, preferences, and limitations of the shares of each
class, and of each series within a class, are as follows:

          Common Stock:  The shares of common stock shall have unlimited  voting
          rights and are entitled,  together with any series of preferred  stock
          which also has such right specified,  to receive the net assets of the
          corporation upon dissolution.

          Preferred  Stock:  The board of directors may  determine,  in whole or
          part, the  preferences,  limitations,  and relative rights (within the
          limits set forth in Section  33-6-101 of the South  Carolina  Business
          Corporation  Act) of one or more series  within the class of preferred
          stock before the issuance of any shares of that series.

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