SUN BANCORP INC
EXHIBIT 10.1
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<DESCRIPTION>EXHIBIT 10.1
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<P ALIGN="CENTER"><FONT SIZE=2><A
NAME="ek1085_exhibit_10.1"> </A>
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<BR></FONT><FONT SIZE=2><B>Exhibit&nbsp;10.1    <BR>  </B></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>Employment
Agreement<BR>
between Robert J. McCormack,<BR>
the Registrant and Sun Bank,<BR>
dated October&nbsp;31, 2002 </FONT></P>

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<BR></FONT><FONT SIZE=2><B>EMPLOYMENT AGREEMENT    <BR>  </B></FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;THIS AGREEMENT is made as of the 31st day of October, 2002, between SUN BANCORP,&nbsp;INC. ("Corporation"), a Pennsylvania business corporation having a place
of business at 2-16 South Market Street, Selinsgrove, Pennsylvania 17870, SUN BANK ("Bank"), a Pennsylvania chartered banking institution having a place of business at 2-16
South Market Street, Selinsgrove, Pennsylvania 17870, and ROBERT J. McCORMACK ("Executive"), an individual residing at RR #6, Box 266-K, Lewisburg, Pennsylvania, 17837 (collectively, the
"Parties" and, individually, sometimes a "Party"). </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
the Corporation is a registered bank holding company; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
the Bank is a subsidiary of the Corporation; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
any reference solely to Corporation in this Agreement shall mean Corporation or Bank; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
Corporation and Bank desire to employ Executive to serve in the capacity of President and CEO of the Bank and Corporation under the terms and conditions set forth in this
Agreement; and </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,
Executive desires to accept employment with Corporation and Bank under the terms and conditions set forth in this Agreement. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;NOW,
THEREFORE, the parties hereto, intending to be legally bound, agree as follows: </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Employment.</I></FONT><FONT SIZE=2> Corporation and Bank hereby employ Executive and Executive hereby accepts employment with Corporation and
Bank, on the terms and conditions set forth in this Agreement. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Duties and Position of Executive.</I></FONT><FONT SIZE=2> Executive shall perform and discharge well and faithfully such duties as an executive
officer of Corporation as may be assigned to Executive from time to time by the Board of Directors of Corporation. Executive shall be employed as President and Chief Executive Officer of the Bank and
Corporation, and shall hold such other titles as may be given to him from time to time by the Board of Directors of Corporation. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Engagement in Other Employment.</I></FONT><FONT SIZE=2> Executive shall devote his full time, attention and energies to the business of
Corporation and Bank during the Employment Period (as defined in Section&nbsp;4(a) of this Agreement); provided, however, that this Section&nbsp;3 shall not be construed as preventing Executive
from (a)&nbsp;investing Executive's personal assets in enterprises that do not compete with Corporation, Bank or any of their subsidiaries or affiliates or (b)&nbsp;being involved in any other
activity with the prior approval of the Boards of Directors of Corporation and Bank. The Executive shall not engage in any business or commercial activities, duties or pursuits which compete with the
business or commercial activities of Corporation, Bank or any of their subsidiaries or affiliates, nor may the Executive serve as a director or officer or in any other capacity in a company which
competes with Corporation, Bank or any of their subsidiaries or affiliates. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Term of Agreement.</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;Employment
Period. This Agreement shall be for a three (3)&nbsp;year period (the "Employment Period") beginning on the date first mentioned above, and if not
previously terminated pursuant to the terms of this Agreement, the Employment Period shall end three (3)&nbsp;years later; provided however, that the Employment Period shall be automatically renewed
one year later on the first anniversary date of the commencement of the Employment Period (the "Renewal Date") for a period ending three
(3)&nbsp;years from the Renewal Date unless either party shall give written notice of non-renewal to the other party at least sixty (60)&nbsp;days prior to the Renewal Date, in which
event this Agreement shall terminate at the end of the Employment Period. If this Agreement is renewed on the Renewal Date, it will be automatically renewed on the first anniversary date of the
Renewal Date and each subsequent year (the "Annual Renewal Date") for a period ending three (3)&nbsp;years from each Annual Renewal Date, unless either party gives written notice of
non-renewal to the other party at least sixty (60)&nbsp;days prior to the Annual </FONT></P>

</UL>
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<P><FONT SIZE=2>
Renewal Date, in which case this Agreement will continue in effect for a term ending two (2)&nbsp;years from the Annual Renewal Date immediately following such notice. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;Cause.
Notwithstanding the provisions of Section&nbsp;4(a) of this Agreement, this Agreement shall terminate automatically for Cause (as defined herein) upon written
notice from the Board of Directors of Corporation to Executive. As used in this Agreement, the term "Cause" shall mean any of the following: </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;Executive's
conviction of or plea of guilty or nolo contendere to a felony, a crime of falsehood or a crime involving moral turpitude, or the actual incarceration of
Executive; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;Executive's
failure to follow the good faith lawful instructions of the Board of Directors of Corporation with respect to its operations, after notice from Corporation,
and a failure to cure such violation within twenty (20)&nbsp;days of said notice; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;the
willful failure by the Executive to substantially perform his duties hereunder, other than a failure resulting from Executive's incapacity because of physical or
mental illness, as provided in Section&nbsp;4(e) of this Agreement, after notice from the Corporation and a failure to cure such violation within twenty (20)&nbsp;days of said notice; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;Executive's
intentional violation of the provisions of this Agreement, after notice from Corporation, and a failure to cure such violation within twenty
(20)&nbsp;days of said notice; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;&nbsp;dishonesty
or gross negligence of the Executive in the performance of his duties; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)&nbsp;&nbsp;conduct
on the part of the Executive which brings public discredit to Corporation as determined by a vote of two-thirds (<SUP>2</SUP>/<SMALL>3</SMALL>) of the Board of
Directors of Corporation; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii)&nbsp;Executive's
breach of fiduciary duty involving personal profit; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii)Executive's
violation of any law, rule or regulation governing banks or bank officers or any final cease and desist order issued by a bank regulatory authority; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix)&nbsp;&nbsp;Executive's
unlawful discrimination, including harassment, against Corporation's employees, customers, business associates, contractors or visitors; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x)&nbsp;&nbsp;Executive's
theft or abuse of Corporation's property or the property of Corporation's customers, employees, contractors, vendors or business associates; </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xi)&nbsp;&nbsp;any
final removal or prohibition order to which the Executive is subject, by a federal banking agency pursuant to Section&nbsp;8(e) of the Federal Deposit Insurance
Act; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xii)&nbsp;any
act of fraud or misappropriation by Executive; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xiii)intentional
misrepresentation of a material fact, or intentional omission of information necessary to make the information supplied not materially misleading, in an
application or other information provided by the Executive to Corporation or any representative of Corporation in connection with the Executive's employment with Corporation and Bank; </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xiv)&nbsp;direction
or recommendation of a state or federal bank regulatory authority to remove the Executive from his position with Corporation and/or Bank, as identified
herein; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xv)&nbsp;the
willful engaging by the Executive in misconduct injurious to Corporation, after notice from Corporation, and a failure to cure such conduct within twenty
(20)&nbsp;days of said notice; or </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xvi)&nbsp;willful
and serious violation(s) by Executive of the Bank's "Core Values", and a failure to cure such violation(s) within twenty (20)&nbsp;days after notice by the
Corporation; if the violation is so serious that an attempt to cure would be fruitless, no notice need be given by the Bank. </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>2</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xvii)
the existence of any material conflict between the interests of Corporation and the Executive that is not disclosed in writing by the Executive to Corporation and
Bank and approved in writing by the Boards of Directors of Corporation and Bank and, after notice from Corporation, a failure to cure such conflict within twenty (20)&nbsp;days of said notice. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
this Agreement is terminated for Cause, all of Executive's rights under this Agreement shall cease as of the effective date of such termination and all of Corporation and Bank's
compensation and employment obligations under this Agreement shall terminate. </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;Notwithstanding
the provisions of Section&nbsp;4(a) of this Agreement, all of Corporation and Bank's obligations under this Agreement shall terminate automatically
upon Executive's voluntary termination of employment. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;Good
Reason. Notwithstanding the provisions of Section&nbsp;4(a) of this Agreement, the Executive may terminate his employment under this Agreement for Good Reason. As
used in this Agreement, "Good Reason" shall mean any of the following: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;any
reduction in the Executive's Annual Base Salary, as in effect on the date this Agreement is executed or as the same may be increased from time to time, except such
reductions that are the result of a national financial depression or national or bank emergency, or when such reduction has been implemented by the Board of Directors for the Corporation's senior
management; or </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;a
requirement that Executive move his principal residence more than seventy-five (75)&nbsp;miles from the location of Corporation's principal executive
office immediately prior to this Agreement; or </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;any
removal of the Executive from any of the positions indicated in Section&nbsp;2 of this Agreement, other than for a promotion, except as a result of his
regulatory removal and/or in connection with termination of the Executive's employment for Cause. </FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If
Executive terminates his employment for Good Reason, then he may give notice of intention to collect benefits under this Agreement by delivering a notice in writing (the "Notice of
Termination") and Corporation shall pay Executive an amount equal to one (1)&nbsp;times the Executive's Annual Base Salary as defined in Section&nbsp;5(a) of this Agreement, which amount shall be
payable in twelve (12)&nbsp;equal
monthly installments and shall be subject to federal, state and local tax withholdings. In addition, Executive shall receive a continuation, for a period of twelve (12)&nbsp;months from the date of
termination of employment, or until Executive secures substantially similar benefits through other employment, whichever shall first occur, of all health, accident, life and disability insurance
benefits in effect with respect to Executive on the date of termination of employment and that were in effect during the two (2)&nbsp;years prior to Executive's termination of employment, or, if
Corporation cannot provide such benefits because Executive is no longer an employee, a dollar amount equal to the cost to Executive of obtaining such benefits or substantially similar benefits.
Executive only becomes entitled to receive these payments and continuation of benefits if he executes a General Release in favor of Corporation, Bank and their subsidiaries and affiliates. However, in
the event the payments described herein, when added to all other amounts or benefits provided to or on behalf of the Executive in connection with his termination of employment, would result in the
imposition of an excise tax under Code Section&nbsp;4999, such payments shall be retroactively (if necessary) reduced to the extent necessary to avoid such excise tax imposition. Upon written notice
to Executive, together with calculations of Corporation's independent auditors, Executive shall remit to Corporation the amount of the reduction, plus such interest as may be necessary to avoid the
imposition of such excise tax. Notwithstanding the foregoing or any other provision of this contract to the contrary, if any portion of the amount herein payable to the Executive is determined to be
non-deductible pursuant to the regulations promulgated under Section&nbsp;280G of the Internal Revenue Code of 1986, as amended (the "Code"), then </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>3</FONT></P>

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Corporation shall be required only to pay to Executive the amount determined to be deductible under Section&nbsp;280G. </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;Disability.
Notwithstanding the provisions of Section&nbsp;4(a) of this Agreement, if, as a result of physical or mental injury or impairment, Executive is unable to
perform all of the essential job functions of his position on a full time basis, taking into account any reasonable accommodation required by law, and without posing a direct threat to himself and
others, for a period up to one hundred eighty (180)&nbsp;days, all obligations of Corporation and Bank to pay Executive an Annual Base Salary as set forth in Paragraph&nbsp;5(a) of this Agreement
are suspended. Any paid time off, sick leave, or short term disability pay Executive may be entitled to receive, pursuant to an established disability plan or program of the Bank and/or Corporation,
if any exists, shall be considered part of the compensation Executive shall receive while disabled, and shall not be in addition to the compensation received by Executive under this provision of the
Agreement. Executive further agrees that should he remain unable to perform all of the essential functions of his position on a full time basis, taking into account any reasonable accommodation
required by law, and without posing a direct threat to himself or others, after one hundred eighty (180)&nbsp;days, the Bank and Corporation will suffer an undue hardship by continuing Executive in
his position. Upon this event, all compensation and employment obligations of the Bank and Corporation under this Agreement shall cease (except Executive's rights under the Corporation's then existing
short term and/or long term disability plans, if any), and this Agreement shall terminate. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)&nbsp;&nbsp;&nbsp;&nbsp;Death.
Notwithstanding the provisions of Section&nbsp;4(a) of this Agreement, this Agreement shall terminate automatically upon Executive's death and Executive's
rights under this Agreement shall cease as of the date of such termination. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Employment Period Compensation.</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;Annual
Base Salary. For services performed by Executive under this Agreement, Corporation shall pay Executive an Annual Base Salary in the aggregate during the
Employment Period at the rate of One Hundred Eighty Thousand Three Dollars and Twenty Cents ($180,003.20) per year, payable at the same times as salaries are payable to other executive employees of
Corporation. Corporation may, from time to time, increase Executive's Annual Base Salary, and any and all such increases shall be deemed to constitute amendments to this Section&nbsp;5(a) to reflect
the increased amounts, effective as of the date established for such increases by the Board of Directors of Corporation or any committee of such Board in the resolutions authorizing such increases. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;Bonus.
Executive may be eligible for incentive compensation under the terms and conditions of any incentive compensation plan that Corporation may have in effect from
time to time. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;Vacations.
During the term of this Agreement, Executive shall be entitled to paid annual vacation in accordance with the policies as established from time to time by the
Board of Directors of Corporation and Bank. However, Executive shall not be entitled to receive any additional compensation from Corporation for failure to take a vacation, nor shall Executive be able
to accumulate unused vacation time from one year to the next, except to the extent authorized by the Board of Directors of Corporation. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;Employee
Benefit Plans. During the term of this Agreement, Executive shall be entitled to participate in and receive the benefits of any Employee Benefit Plan currently
in effect at Corporation, until such time that the Board of Directors of Corporation authorizes a change in such benefits. Executive shall also be entitled to participate in any stock option and
profit sharing plans that Corporation may have in effect, subject to the terms and conditions of those plans. Nothing paid to Executive under any plan or arrangement presently in effect or made
available in </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>4</FONT></P>

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<P><FONT SIZE=2>
the future shall be deemed to be in lieu of the salary payable to Executive pursuant to Section&nbsp;5(a) hereof. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)&nbsp;&nbsp;Business
Expenses. During the term of this Agreement, Executive shall be entitled to receive prompt reimbursement for all reasonable expenses incurred by him, which are
properly accounted for, in accordance with the policies and procedures established by the Board of Directors of Corporation for its executive officers. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Termination of Employment Following Change in Control.</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;If
a Change in Control (as defined in Section&nbsp;6(b) of this Agreement) shall occur then, at the option of Executive, exercisable by Executive within one hundred
eighty (180)&nbsp;days of the Change of Control,
Executive may resign from employment with Corporation and Bank (or, if involuntarily terminated, give notice of intention to collect benefits under this Agreement) by delivering a notice in writing
(the "Notice of Termination") to Corporation and Bank and the provisions of Section&nbsp;7 of this Agreement shall apply. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;As
used in this Agreement, "Change in Control" shall mean a change in control (other than one occurring by reason of an acquisition of the Bank and/or Corporation by
Executive) of a nature that would be required to be reported in response to Item 6(e) of Schedule&nbsp;14A of Regulation&nbsp;14A or any successor rule or regulation promulgated under the
Securities Exchange Act of 1934, as amended (the "1934 Act"); provided that, without limiting the foregoing, a Change in Control shall be deemed to have occurred if: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;(A)
the Corporation and/or Bank shall be merged or consolidated, or (B)&nbsp;substantially all of the assets of Corporation and/or Bank shall be sold, exchanged,
transferred or otherwise disposed of, and, as a result of such merger, consolidation, sale, exchange or transfer, less than a majority of the outstanding voting stock of the surviving, resulting,
purchasing "person"is owned, immediately after the transaction, by the holders of voting stock of the Corporation before the transaction, unless (y)&nbsp;such merger, consolidation, sale, exchange,
purchase or transfer is approved in advance by seventy percent (70%) or more of the members of the Board of Directors of Corporation who are not interested in the transaction and (z)&nbsp;a majority
of the members of the Board of Directors of the legal entity resulting from, or existing after, any such transaction, and of the Board of Directors of such entity's parent corporation, if any, are
former members of the Board of Directors of Corporation, or </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;any
"person" or group of "persons"(as such term is used in Sections 13(d) and 14(d) of the 1934 Act), other than Corporation, Bank or any "person" who on the date
hereof is a director or officer of Corporation and/or Bank is or becomes the "beneficial owner" (as defined in Rule&nbsp;13d-3 under the 1934 Act or any successor rule or regulation
promulgated under the 1934 Act), directly or indirectly, of securities of Corporation representing (30%) percent more of the combined voting power of Corporation's then outstanding securities, or </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;during
any period of two (2)&nbsp;consecutive years during the term of Executive's employment under this Agreement, individuals who at the beginning of such period
constitute the Board of Directors of Corporation cease for any reason to constitute at least a majority thereof, unless the election of each director who was not a director at the beginning of such
period has been approved in advance by directors representing at least two-thirds of the directors then in office who were directors at the beginning of the period. </FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Rights in Event of Termination of Employment Following Change in Control.</I></FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>5</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;In
the event that a Change in Control occurs and Executive delivers a Notice of Termination (as defined in Section&nbsp;6(a) of this Agreement) to Corporation and
Bank, Executive shall be entitled to receive the compensation and benefits set forth below: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;a
lump sum equal to three (3)&nbsp;times the Executive's Annual Base Salary as defined in Section&nbsp;5(a), which amount shall be subject to federal, state and
local tax withholdings; and </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;for
a period of three (3)&nbsp;years from the date of termination of employment, or until Executive secures substantially similar benefits through other employment,
whichever shall first occur, Executive shall receive a continuation of all health, accident, life and disability insurance benefits in effect with respect to Executive during the two (2)&nbsp;years
prior to his termination of employment, or, if Corporation cannot provide such benefits because Executive is no longer an employee, a dollar amount equal to the cost to Executive of obtaining such
benefits or substantially similar benefits. </FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;However,
in the event the payment described herein, when added to all other amounts or benefits provided to or on behalf of the Executive in connection with his termination of
employment, would result in the imposition of an excise tax under Code Section&nbsp;4999, such payments shall be retroactively (if necessary) reduced to the extent necessary to avoid such excise tax
imposition. Upon written notice to Executive, together with calculations of Corporation's independent auditors, Executive shall remit to Corporation the amount of the reduction plus such interest as
may be necessary to avoid the imposition of such excise tax. Notwithstanding the foregoing or any other provision of this contract to the contrary, if any portion of the amount herein payable to the
Executive is determined to be non-deductible pursuant to the regulations promulgated under Section&nbsp;280G of the Internal Revenue Code of 1986, as amended (the "Code"), the
Corporation shall be required only to pay to Executive the amount determined to be deductible under Section&nbsp;280G. </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;Executive
shall not be required to mitigate the amount of any payment provided for in this Section&nbsp;7 by seeking other employment or otherwise. The amount of
payment provided for in this Section&nbsp;7(a)(i)&nbsp;shall not be reduced by any compensation earned by Executive as the result of employment by another employer or by reason of Executive's
receipt of or right to receive any retirement or other benefits after the date of termination of employment or otherwise. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Rights in Event of Termination of Employment Absent Change in Control.</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;In
the event that Executive's employment is involuntarily terminated by Corporation without Cause and no Change in Control shall have occurred at the date of such
termination, Corporation shall pay Executive an amount equal to and no greater than three (3)&nbsp;times the Executive's Annual Base Salary as defined in Section&nbsp;5(a) of this Agreement, which
amount shall be payable in thirty-six (36)&nbsp;equal monthly installments. In addition, Executive shall be entitled to a continuation of health, accident, life and disability insurance
benefits for thirty-six (36)&nbsp;months or until Executive secures substantially similar benefits through other employment, whichever shall first occur. However, if the payment
described
herein, when added to all other amounts or benefits provided to or on behalf of the Executive in connection with his termination of employment, would result in the imposition of an excise tax under
Code Section&nbsp;4999, such payments shall be retroactively (if necessary) reduced to the extent necessary to avoid such imposition. Upon written notice to Executive, together with calculations of
Corporation's independent auditors, Executive shall remit to Corporation the amount of the reduction plus such interest as may be necessary to avoid the imposition of such excise tax. Notwithstanding
the foregoing or any other provision of this contract to the contrary, if any portion of the amount herein payable to the Executive is determined to be non-deductible pursuant to the
regulations promulgated under Section&nbsp;280G of the Code, then Corporation shall be required only to pay to Executive the amount determined to be deductible under Section&nbsp;280G. </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>6</FONT></P>

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<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;Executive
shall not be required to mitigate the amount of any payment provided for in this Section&nbsp;8 by seeking other employment or otherwise. The amount of
payment provided for in this Section&nbsp;8 (not continuation of benefits) shall not be reduced by any compensation earned by Executive as the result of employment by another employer or by reason
of Executive's receipt of or right to receive any retirement or other benefits after the date of termination of employment or otherwise. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;The
amounts payable pursuant to this Section&nbsp;8 shall constitute Executive's sole and exclusive remedy in the event of involuntary termination without cause of
Executive's employment by Corporation in the absence of a Change in Control. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Restrictive Covenant.</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;Executive
hereby acknowledges and recognizes the highly competitive nature of the business of Corporation and Bank and, accordingly, agrees that, during and for the
applicable period set forth in Section&nbsp;9(c) hereof, Executive shall not: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;be
engaged, directly or indirectly, either for his own account or as agent, consultant, employee, partner, officer, director, proprietor, investor (except as an investor
owning less than 5% of the stock of a publicly owned company) or otherwise of any person, firm, corporation or enterprise engaged in (1)&nbsp;the banking or financial services industry (including
bank holding company), or (2)&nbsp;any other activity in which Corporation, Bank or any of their subsidiaries or affiliates are engaged during the Employment Period, in any county in which, at any
time during the Employment Period or on the date of termination of the Executive's employment, a branch, office or other facility of Corporation, Bank or any of their subsidiaries or affiliates is
located, or in any county contiguous to such a county, including contiguous counties located outside of the Commonwealth of Pennsylvania (the "Non-Competition Area"); or </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;provide
financial or other assistance to any person, firm, corporation, or enterprise engaged in (1)&nbsp;the banking or financial services industry (including bank
holding company), or (2)&nbsp;any other activity in which Corporation, Bank or any of their subsidiaries or affiliates are engaged during the Employment Period in the Non-Competition
Area; or </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;directly
or indirectly contact, solicit or induce any person, corporation or other entity who or which is a customer or referral source of Corporation, Bank or any of
their subsidiaries or affiliates, during the term of Executive's employment or on the date of termination of Executive's employment; or </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;directly
or indirectly solicit, induce or encourage any employee of Corporation, Bank or any of their subsidiaries or affiliates, who is employed during the term of
Executive's employment or on the date of termination of Executive's employment, to leave the employ of Corporation, Bank or any of their subsidiaries or affiliates, or to seek, obtain or accept
employment with any person or entity other than Corporation, Bank or any of their subsidiaries or affiliates. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;It
is expressly understood and agreed that, although Executive, Corporation and Bank consider the restrictions contained in Section&nbsp;9(a) reasonable for the
purpose of preserving for Corporation, Bank and any of their subsidiaries or affiliates, their good will and other proprietary rights, if a final judicial determination is made, by a court or
arbitration panel having jurisdiction, that the time or territory or any other restriction contained in Section&nbsp;9(a) is an unreasonable or otherwise unenforceable restriction against Executive,
the provisions of Section&nbsp;9(a) shall not be rendered void, but shall be deemed amended to apply as to such maximum time and territory and to such other extent as such court may judicially
determine or indicate to be reasonable. </FONT></P>

</UL>
<P ALIGN="CENTER"><FONT SIZE=2>7</FONT></P>

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<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;The
provisions of this Section&nbsp;9 shall be applicable, commencing on the date of this Agreement and ending on one of the following dates, as applicable: </FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;&nbsp;&nbsp;&nbsp;if
Executive voluntarily terminates his employment without Good Reason, the first anniversary date of the effective date of termination of employment; </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;&nbsp;if
Executive's employment terminates in accordance with the provisions of Section&nbsp;4(b) of this Agreement (relating to termination for Cause) or the Executive
voluntarily terminates his employment in accordance with the provisions of Section&nbsp;4(c) of this Agreement (relating to termination by Executive for Good Reason), the second anniversary date of
the effective date of termination of employment; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;&nbsp;if
the Executive's employment is involuntarily terminated in accordance with the provisions of Section&nbsp;6 of this Agreement (relating to involuntary termination
without Cause following a Change in Control), the third anniversary date of the effective date of termination of employment;. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;&nbsp;if
the Executive's employment is involuntarily terminated in accordance with the provisions of Section&nbsp;8 of this Agreement (relating to involuntary termination
without Cause absent a Change in Control), the third anniversary date of the effective date of termination of employment; </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;&nbsp;if
Executive's employment terminates in accordance with the provisions of Section&nbsp;4(a) relating to non-renewal of contract, the effective date of
termination of employment. </FONT></P>

</UL>
</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Unauthorized Disclosure.</I></FONT><FONT SIZE=2> During the term of his employment hereunder, or at any later time, the Executive shall not,
without the written consent of the Board of Directors of Corporation or a person authorized thereby, knowingly disclose to any person, other than an employee of the Corporation or a person to whom
disclosure is reasonably necessary or appropriate in connection with the performance by the Executive of his duties as an executive of Corporation, any material confidential information obtained by
him while in the employ of Corporation with respect to any of the services, products, improvements, formulas, designs or styles, processes, customers, customer lists, methods of business or any
business practices of Corporation, Bank or any of their subsidiaries or affiliates, the disclosure of which could be or will be damaging to Corporation, Bank or any of their subsidiaries or
affiliates; provided, however, that confidential information shall not include any information known generally to the public (other than as a result of unauthorized disclosure by the Executive or any
person with the assistance, consent or direction of the Executive) or any information of a type not otherwise considered confidential by persons engaged in the same business or a business similar to
that conducted by Corporation, Bank or any of their subsidiaries or affiliates or any information that must be disclosed as required by law. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Work Made for Hire.</I></FONT><FONT SIZE=2> Any work performed by the Executive under this Agreement should be considered a "Work Made for Hire"
as that phrase is defined by the U.S. patent laws and shall be owned by and for the express benefit of Corporation, Bank and their subsidiaries and affiliates. In the event it should be established
that such work does not qualify as a Work Made for Hire, the Executive agrees to and does hereby assign to Corporation, Bank and their affiliates and subsidiaries, all of his rights, title, and/or
interest in such work product, including, but not limited to, all copyrights, patents, trademarks, and proprietary rights. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Return of Company Property and Documents.</I></FONT><FONT SIZE=2> The Executive agrees that, at the time of termination of his employment,
regardless of the reason for termination, he will deliver to Corporation, Bank and their subsidiaries and affiliates, any and all company property, including, but not limited to, automobiles, keys,
security codes or passes, mobile telephones, pagers, computers, devices, confidential information, records, data, notes, reports, proposals, lists, correspondence, specifications, drawings, </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>8</FONT></P>

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<BR>

<P><FONT SIZE=2>
blueprints, sketches, software programs, equipment, other documents or property, or reproductions of any of the aforementioned items developed or obtained by the Executive during the course of his
employment. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Resignation as Director.</I></FONT><FONT SIZE=2> Executive agrees that in the event that this Agreement or his employment under this Agreement is
terminated, Executive shall resign as a director of Corporation, Bank or any of their affiliates or subsidiaries, if he is then serving as a director of any such entities. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Liability Insurance.</I></FONT><FONT SIZE=2> Corporation shall use its best efforts to obtain insurance coverage for the Executive under an
insurance policy covering officers and directors of Corporation and Bank against lawsuits, arbitrations or other legal or regulatory proceedings; however, nothing herein shall be construed to require
Corporation to obtain such insurance, if the Board of Directors of the Corporation determines that such coverage cannot be obtained at a reasonable price. </FONT></P>


<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Indemnification.</I></FONT><FONT SIZE=2> Corporation will indemnify the Executive as required by Pennsylvania law and as provided by the Articles
and By-laws of Corporation, with respect to any threatened, pending or completed legal or regulatory action, suit or proceeding brought against him by reason of the fact that he is or was
a director, officer, employee or agent of Corporation or is or was serving at the request of Corporation as a director, officer, employee or agent of another person or entity. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;16.&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Notices.</I></FONT><FONT SIZE=2> For the purposes of this Agreement, notices and all other communications provided for in this Agreement shall be
in writing and shall be deemed to have been duly given when delivered or mailed by United States certified mail, return receipt requested, postage prepaid, addressed as follows (or to such other
addresses provided by a party to the other parties in writing): </FONT></P>

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<TD WIDTH="26%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="34%"><FONT SIZE=2>If to the Executive:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="34%"><FONT SIZE=2>Mr.&nbsp;Robert McCormack<BR>
RR #6 Box 266-K<BR>
Lewisburg, PA 17837</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="26%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="34%"><FONT SIZE=2><BR>
If to the Bank:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="34%"><FONT SIZE=2><BR>
Mr.&nbsp;Robert Hormell<BR>
Personnel Committee Chair<BR>
Sun Bank<BR>
2-16 South Market Street<BR>
Selinsgrove, Pennsylvania 17870</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="26%"><FONT SIZE=2><BR>
&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="34%"><FONT SIZE=2><BR>
If to the Corporation:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="34%"><FONT SIZE=2><BR>
Mr.&nbsp;Robert Hormell<BR>
Personnel Committee Chair<BR>
Sun Bancorp,&nbsp;Inc.<BR>
2-16 South Market Street<BR>
Selinsgrove, Pennsylvania 17870</FONT></TD>
</TR>
</TABLE>
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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Waiver.</I></FONT><FONT SIZE=2> No provision of this Agreement may be modified, waived or discharged unless such waiver, modification or
discharge is agreed to in writing and signed by Executive and an executive officer specifically designated by the Board of Directors of Corporation and Bank. No waiver by either party, at any time, of
any breach by the other party of, or compliance with, any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time. Notwithstanding this Section&nbsp;17, a promotion of Executive in accordance with Section&nbsp;2 of this Agreement shall not constitute a
breach of this Agreement or require an amendment in writing. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18.&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Assignment.</I></FONT><FONT SIZE=2> This Agreement shall not be assignable by any party, except by Corporation to any successor in interest to
its respective businesses. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Entire Agreement.</I></FONT><FONT SIZE=2> This Agreement contains the entire agreement of the parties relating to the employment of Executive and
supersedes any and all agreements, either oral or in writing, between the </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>9</FONT></P>

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<BR>

<P><FONT SIZE=2>
parties with regard to the employment of Executive by Corporation, including the Change of Control Agreement dated December&nbsp;7, 1998 and the Employment Agreement dated March&nbsp;1, 2002. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Successors; Binding Agreement.</I></FONT></P>

<UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;Corporation
and Bank will require any successor (whether direct or indirect, by purchase, merger, consolidation, or otherwise) to all or substantially all of the
businesses and/or assets of Corporation and Bank to expressly assume and agree to perform this Agreement in the same manner and to the same extent that Corporation and Bank would be required to
perform it if no such succession had taken place. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;This
Agreement shall inure to the benefit of and be enforceable by Executive's personal or legal representatives, executors, administrators, heirs, distributees,
devisees and legatees. If Executive should die after a Notice of Termination is delivered by Executive, or following termination of Executive's employment without Cause, and any amounts would be
payable to Executive under this Agreement if Executive had continued to live, all such amounts shall be paid in accordance with the terms of this Agreement to Executive's devisee, legatee, or other
designee, or, if there is no such designee, to Executive's estate. </FONT></P>

</UL>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21.&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Arbitration.</I></FONT><FONT SIZE=2> Corporation and Executive recognize that in the event a dispute should arise between them concerning the
interpretation or implementation of this Agreement (except for any enforcement sought with respect to Sections 9, 10, 11, or 12, which may be litigated in court), lengthy and expensive litigation will
not afford a practical resolution of the issues within a reasonable period of time. Consequently, each party agrees that all disputes, disagreements and questions of interpretation concerning this
Agreement are to be submitted for resolution, in Philadelphia, Pennsylvania, to the American Arbitration Association (the "Association") in accordance with the Association's National Rules for the
Resolution of Employment Disputes or other applicable rules then in effect ("Rules"). Corporation or Executive may initiate an arbitration proceeding at any time by giving notice to the other in
accordance with the Rules. Corporation and Executive may, as a matter or right, mutually agree on the appointment of a particular arbitrator from the Association's pool. The arbitrator shall not be
bound by the rules of evidence and procedure of the courts of the Commonwealth of Pennsylvania, but shall be bound by the substantive law applicable to this Agreement. The decision of the arbitrator,
absent fraud, duress, incompetence or gross and obvious error of fact, shall be final and binding upon the parties and shall be enforceable in courts of proper jurisdiction. Following written notice
of a request for arbitration, Corporation, Bank and Executive shall be entitled to an injunction restraining all further proceedings in any pending or subsequently filed litigation concerning this
Agreement, except as otherwise provided herein or any enforcement sought with respect to Sections 9, 10, 11, or 12. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;22.&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Attorney's Fees and Costs.</I></FONT><FONT SIZE=2> If any action at law or in equity is necessary to enforce or interpret the terms of this
Agreement, each party shall bear his or its own attorney's fees, costs, and expenses incurred in connection with the litigation, unless mandated by statute. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Validity.</I></FONT><FONT SIZE=2> The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement, which shall remain in full force and effect. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;24.&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Applicable Law.</I></FONT><FONT SIZE=2> This Agreement shall be governed by and construed in accordance with the domestic, internal laws of the
Commonwealth of Pennsylvania, without regard to its conflicts of laws principles. </FONT></P>

<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.&nbsp;&nbsp;</FONT><FONT
SIZE=2><I>Headings.</I></FONT><FONT SIZE=2> The section headings of this Agreement are for convenience only and shall not control or affect the meaning or
construction or limit the scope or intent of any of the provisions of this Agreement. </FONT></P>

<P ALIGN="CENTER"><FONT SIZE=2>10</FONT></P>

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<P><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written. </FONT></P>

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<TR VALIGN="TOP">
<TD WIDTH="49%"><FONT SIZE=2>ATTEST:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2>SUN BANCORP,&nbsp;INC.</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>SANDRA J. MILLLER</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>ROBERT HORMELL</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;<BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>ROBERT HORMELL</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;<BR>
Personnel Committee Chair</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%"><FONT SIZE=2><BR>
ATTEST:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2><BR>
SUN BANK</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>SANDRA J. MILLLER</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>ROBERT HORMELL</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;<BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>ROBERT HORMELL</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;<BR>
Personnel Committee Chair</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%"><FONT SIZE=2><BR>
WITNESS:</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2><BR>
EXECUTIVE:</FONT></TD>
</TR>
<TR VALIGN="TOP">
<TD WIDTH="49%"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>SANDRA J. MILLER</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
<TD WIDTH="3%"><FONT SIZE=2><BR>&nbsp;</FONT></TD>
<TD WIDTH="49%"><FONT SIZE=2><BR>
/s/&nbsp;&nbsp;</FONT><FONT SIZE=2>ROBERT J. MCCORMACK</FONT><FONT SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;<BR>
Robert J. McCormack</FONT></TD>
</TR>
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<P ALIGN="CENTER"><FONT SIZE=2>11</FONT></P>

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