SUSSEX BANCORP
EXHIBIT 10.A
<DOCUMENT>
<TYPE>EX-10.A
<SEQUENCE>2
<FILENAME>ex10a.htm
<DESCRIPTION>EXHIBIT 10.A
<TEXT>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">EMPLOYMENT
      AGREEMENT</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Employment
      Agreement (the "Employment Agreement") made as of this 20th day of February,
      2008 and effective as of January 23, 2008 (the "Effective Date) is by and
      between <font style="DISPLAY: inline; FONT-WEIGHT: bold">TERRY THOMPSON</font>,
      an individual residing at 36 Beacon Hill, Sparta, New Jersey 07871 (the
      "Employee"), <font style="DISPLAY: inline; FONT-WEIGHT: bold">SUSSEX
      BANK</font>, a state chartered bank with its principal place of business located
      at 399 State Highway 23, Franklin, New Jersey 07416 (the &#8220;Employer&#8221;), and <font style="DISPLAY: inline; FONT-WEIGHT: bold">SUSSEX BANCORP</font>, a New Jersey
      corporation with its principal place of business located at 399 State Highway
      23, Franklin, New Jersey 07416 (the "Company").</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">WHEREAS</font>,
      the Board of
      Directors of the Employer and the Board of Directors of the Company have each
      determined that it is in the best interests of each of the Employer and the
      Company to enter into this Agreement with Employee, and each respective Board
      has authorized the Employer and the Company to enter into this
      Agreement;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">WHEREAS</font>,
      the Employee agrees
      to be employed pursuant to the terms and conditions of this
      Agreement;</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">NOW,
      THEREFORE</font>, in
      consideration of the premises and covenants contained herein, and with the
      intent to be legally bound hereby, the parties hereto hereby agree as
      follows:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">1.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic">Employment</font>.&#160;&#160;The
      Employer agrees to employ the Employee, and the Employee hereby accepts such
      employment, upon the terms and conditions set forth herein.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic">Position
      and
      Duties</font>.&#160;&#160;The Employee shall be employed as President and the
      Chief Operating Officer of the Employer, to perform such services in that
      capacity as are usual and customary for comparable institutions and as shall
      from time-to-time be established by the Chief Executive Officer and the Board
      of
      Directors of the Employer.&#160;&#160;Employee agrees that he will devote his
      full business time and efforts to his duties hereunder.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic">Cash
      Compensation</font>.&#160;&#160;Employer shall pay to the Employee compensation
      for his services as follows:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; TEXT-DECORATION: underline">Base
      Salary</font>.&#160;&#160;The Employee shall be entitled to receive, commencing
      upon the date of this Agreement, an annual base salary (the "Base Salary")
      of
      $140,343, which shall be payable in installments in accordance with Employer's
      usual payroll method.&#160;&#160;Annually thereafter, on or prior to the
      anniversary date of this Agreement, the Chief Executive Officer
      and</font></div><br>
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    </div><br>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Board
      of
      Directors shall review the Employee's performance, the status of Employer and
      such other factors as the Board of Directors or a committee thereof shall deem
      appropriate and shall adjust the Base Salary accordingly. Employee acknowledges
      that his Base Salary hereunder may be adjusted upward or downward; provided,
      however, that in no event will his Base Salary be adjusted downward below the
      minimum base salary established by the Employer as part of its regular annual
      employee review process for employees having the same grade as
      Employee.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; TEXT-DECORATION: underline">Discretionary
      Bonus</font>.&#160;&#160;Employee may be entitled to receive annually at the
      discretion of the Board of Directors or a committee thereof a cash
      bonus.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic">Other
      Benefits; Fringe
      Benefits</font>.&#160;&#160;The Employee shall be entitled to the exclusive and
      unlimited use of an automobile or a cash allowance to be used for the purpose
      of
      maintaining an automobile of a type and style commensurate with the Employee's
      status as President of the Employer.&#160;&#160;In addition, the Employee shall
      be entitled to receive hospital, health, medical, and life insurance of a type
      currently provided to and enjoyed by other senior officers of Employer, and
      shall be entitled to participate in any other employee benefit or retirement
      plans offered by Employer to its employees generally or to its senior
      management.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">5.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic">Term</font>.&#160;&#160;&#160;The
      term of this Agreement shall be three (3) years, commencing on the date hereof
      and continuing until the third anniversary of the date hereof; provided,
      however, that the term of this Agreement shall automatically renew for one
      (1)
      additional year on the third anniversary&#160;&#160;hereof unless, at least
      three (3) months prior to such anniversary date, either Employer or Employee
      shall have provided the other with written notice of their intention not to
      extend the term of this Agreement; further provided, however, that in the event
      the term of this Agreement is so extended, it shall also automatically renew
      for
      one (1) additional year on the fourth anniversary&#160;&#160;hereof unless, at
      least three (3) months prior to such anniversary date, either Employer or
      Employee shall have provided the other with written notice of their intention
      not to further extend the term of this Agreement.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">6.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic">Termination</font>.&#160;&#160;Employee
      may be terminated at any time, without prejudice to Employee's right to
      compensation or benefits as provided herein.&#160;&#160;Employee's rights upon a
      termination shall be as follows:</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; TEXT-DECORATION: underline">Cause</font>.&#160;&#160;As
      used in this Agreement, the term "Cause" shall mean the Employee's personal
      dishonesty, willful misconduct, breach of fiduciary duty involving
      personal</font></div><br>
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      </div>
    </div><br>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">profit,
      intentional failure to perform stated duties, willful violation of any law,
      rule
      or regulation (other than traffic violations or similar offenses) or final
      cease-and-desist order, or a material breach of any provision of this
      Agreement.&#160;&#160;Notwithstanding the above, the Employee shall not be
      deemed to have been terminated for cause unless and until there shall have
      been
      delivered to him a copy of a resolution duly adopted by the affirmative vote
      of
      not less than three-fourths of the members of the Board of Directors of the
      Employer at a meeting of its Board called and held for that purpose (after
      reasonable notice to the Employee and an opportunity for him, together with
      counsel, to be heard before such Board of Directors), finding that in the good
      faith opinion of the Board of Directors, the Employee was guilty of conduct
      justifying termination for cause and specifying the particulars thereof in
      detail; provided, however, that nothing contained herein shall prohibit Employee
      from being suspended from his duties hereunder by a duly authorized agent of
      the
      Board upon a good faith determination that "cause" exists.&#160;&#160;Such
      suspension shall last until such time as the Board meeting provided for above
      shall have occurred, provided that such Board meeting shall occur within a
      reasonable period of time.&#160;&#160;During such suspension Employee shall
      continue to be an employee, entitled to all salary and benefits provided for
      hereunder.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(b)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; TEXT-DECORATION: underline">Termination
      With
      Cause</font>.&#160;&#160;Employer shall have the right to terminate the Employee
      for "cause", upon written notice to him of such determination, specifying the
      alleged "cause".&#160;&#160;In the event of such termination, the Employee shall
      not be entitled to any further benefits under this Agreement.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; TEXT-DECORATION: underline">Termination
      Without
      Cause</font>.&#160;&#160;&#160;Upon a termination of Employee's employment
      hereunder without "cause", Employee shall be entitled to receive his then
      current base salary for the remaining term of this Agreement.&#160;&#160;Such
      payments may be made over the remaining term of this Agreement in periodic
      payments in the same manner in which the Employee's salary was paid through
      the
      time of such termination, or by a lump sum payment of the discounted present
      value of all base salary payments through the remaining term of this
      Agreement.&#160;&#160;The determination of the method of payment shall be made
      mutually by Employer and the Employee; provided, however, that in the event
      the
      parties cannot agree on the method of payment, Employer shall be entitled to
      choose.&#160;&#160;In addition, Employer shall continue to provide the Employee
      with hospital, health, medical and life insurance, and any other like benefits
      in</font></div><br>
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    </div><br>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">effect
      at
      the time of such termination through the end of the term of this
      Agreement.&#160;&#160;The Employee shall have no duty to mitigate damages in
      connection with his termination by Employer without "cause".&#160;&#160;However,
      if the Employee obtains new employment and such new employment provides for
      hospital, health, medical and life insurance, and other benefits, in a manner
      substantially similar to the benefits payable by Employer hereunder, Employer
      may permanently terminate the duplicative benefits it is obligated to provide
      hereunder.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(d)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Suspension
      and Special Regulatory Rules.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 108pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 108pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(i)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;If
      the Employee is suspended and/or temporarily prohibited from participating
      in
      the conduct of the affairs of the Employer by a notice served under Section
      8(e)(3) or Section 8(g)(1) of the Federal Deposit Insurance Act ("FDI Act"),
      Employer's obligations under this Agreement shall be suspended as of the date
      of
      service, unless stayed by appropriate proceedings.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 108pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 108pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(ii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;If
      the Employee is removed and/or permanently prohibited from participating in
      the
      conduct of the affairs of the Employer by an order issued under Section 8(e)
      or
      Section 8(g)(1) of the FDI Act, all obligations of Employer under this Agreement
      shall terminate as of the effective date of the order and the Employee shall
      not
      be entitled to received the payments provided for under Paragraph (c)
      above.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 108pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 108pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(iii)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;If
      the Employer is in default, as defined in Section 3(x)(1) of the FDI Act, all
      obligations of Employer under this Agreement shall terminate as of the date
      of
      default.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">7.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic">Resignation
      for
      Cause</font>.&#160;&#160;During the term of this Agreement, the Employee shall
      be entitled to resign from his employment with Employer, and receive the
      payments provided for below, in the event that the Employee is not in breach
      of
      this Agreement and Employer (i) reassigns the Employee to a position of lesser
      rank or status than President, or (ii) reduces the Employee's compensation
      or
      other benefits below the amounts provided for under Sections 3 and 4
      hereof.&#160;&#160;Upon the occurrence of any of these events, the Employee
      shall have thirty days to provide Employer notice of his intention to terminate
      this Agreement.&#160;&#160;In the event the Employee elects to so terminate this
      Agreement, such termination shall be treated as a termination without "cause"
      by
      Employer under Section 6(c) hereof, and the Employee shall be entitled to
      receive all payments and other benefits called for under such Section
      6(c).</font></div><br>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">8.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic">Change
      in
      Control</font>.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Upon
      the occurrence of a Change in Control (as herein defined) followed at any time
      during the term of this Agreement by the involuntary termination of the
      Employee's employment other than for "cause", as defined in Section 6(a) hereof,
      or, as provided below the voluntary termination of the Employee within eighteen
      (18) months of such Change in Control, Employee shall become entitled to receive
      the payments provided for under paragraph (c) below.&#160;&#160;Upon the
      occurrence of a Change in Control, the Employee shall have the right to elect
      to
      voluntarily terminate his employment within eighteen (18) months of such Change
      in Control following any demotion, loss of title, office of significantly
      authority, reduction in his annual compensation or benefits, or relocation
      of
      his principal place of employment by more than thirty (30) miles from its
      location immediately prior to the Change in Control.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
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      "Change in Control" shall mean:</font></div>
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          <tr valign="top">
            <td style="WIDTH: 108pt">
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            <td>
              <div align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">a
                reorganization, merger, consolidation or sale of all or substantially
                all
                of the assets of the Company, or a similar transaction, in which
                the
                shareholders of the Company prior to such transaction hold less than
                a
                majority of the voting power of the resulting
                entity;</font></div>
            </td>
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    <div>
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          <tr valign="top">
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            <td>
              <div align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">individuals
                who constitute the Incumbent Board (as herein defined) of the Company
                cease for any reason to constitute a majority
                thereof;</font></div>
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    <div>
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          <tr valign="top">
            <td style="WIDTH: 108pt">
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            </td>
            <td>
              <div align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">an
                event of a nature that would be required to be reported in response
                to
                Item I of the current report on Form 8-K, as in effect on the date
                hereof,
                pursuant to Section 13 or 15(d) of the Securities Exchange Act of
                1934
                (the "Exchange Act") if Employer were a reporting company subject
                to the
                Exchange Act; or</font></div>
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              <div align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Without
                limitation, a change in control shall be deemed to have occurred
                at such
                time as any "person" (as the term is used in Section 13(d) and 14(d)
                of
                the Exchange Act) other than the Company or the Employer or the trustees
                or any administration of any employee stock ownership plan and trust,
                or
                any other employee benefit plans, established by the Company or the
                Employer from time-to-time in is or becomes a "beneficial owner"
                (as
                defined in Rule 13-d under the Exchange Act) directly or indirectly,
                of
                securities of the Employer representing 25% or more of the Company&#8217;s
                outstanding securities ordinarily having the right to vote at the
                election
                of directors (the &#8220;Trigger
                Amount&#8221;);</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 144pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">provided,
      however, that in the event any such person acquires the Trigger Amount in a
      transaction (i) which has been approved in advance by the Incumbent Board and
      (ii) which does not result in such person controlling a majority&#160;&#160;of
      the voting power of the full Board of Directors of the Company, then any such
      transaction shall not be deemed a Change in Control under this subsection (iv);
      or</font></div>
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    <div>
      <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">

          <tr valign="top">
            <td style="WIDTH: 108pt">
              <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;
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            <td>
              <div align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A
                tender offer is made for 25% or more of the voting securities of
                the
                Company and the shareholder owning beneficially or of record 25%
                or more
                of the outstanding securities of the Company have tendered or offered
                to
                sell their shares pursuant to such tender and such tendered shares
                have
                been accepted by the tender
                offeror.</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">For
      these
      purposes, "Incumbent Board" means the Board of Directors of the Company on
      the
      date hereof, provided that any person becoming a director subsequent to the
      date
      hereof whose election was approved by a voting of at least three-quarters of
      the
      directors comprising the Incumbent Board, or whose nomination for election
      by
      members or stockholders was approved by the same nominating committee serving
      under an Incumbent Board, shall be considered as though he were a member of
      the
      Incumbent Board.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;In
      the event the conditions of Section (a) above are satisfied, Employee shall
      be
      entitled to receive a lump sum payment equal to 2.99 times Employee's then
      current Base Salary;<font style="DISPLAY: inline; FONT-WEIGHT: bold">&#160;</font>provided, however,
      that
      in no event shall any payments provided for hereunder constitute an "excess
      parachute payment" under Section 280G of the Internal Revenue Code of 1986,
      as
      amended or any successor thereto, and in order to avoid such a result the
      benefits provided for hereunder will be reduced, if necessary, to an amount
      which is One Dollar ($1.00) less than an amount equal to three (3) times
      Employee's "base amount" as determined in accordance with such Section
      280G.&#160;&#160;In addition to the foregoing, Employee shall be entitled to
      receive from Employer, or its successor, hospital, health, medical and life
      insurance on the terms and at the cost to Employee as Employee was receiving
      such benefits upon the date of his termination.&#160;&#160;Employer's obligation
      to continue such insurance benefits will be for a period of three (3)
      years.</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">9.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic">Covenant
      Not to
      Compete.</font>&#160;&#160;Employee agrees that during the term of his
      employment hereunder and for a period of one (1) year after the termination
      of
      his employment, he will not in any way, directly or indirectly, manage, operate,
      control, accept employment or a consulting position with or otherwise advise
      or
      assist or be connected with or own or have any</font></div><br>
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      interest in or right with respect to (other than through ownership of not more
      than five percent (5%) of the outstanding shares of a corporation whose stock
      is
      listed on a national securities exchange or on the National Association of
      Securities Dealers Automated Quotation System) any enterprise which competes
      with the Company in the financial services business&#160;&#160;in the counties
      in which the Company conducts its business on the date of Employee's
      termination.&#160;&#160;In the event that this covenant not to compete shall be
      found by a court of competent jurisdiction to be invalid or unenforceable as
      against public policy, such court shall exercise discretion in reforming such
      covenant to the end that Employee shall be subject to a covenant not to compete
      that is reasonable under the circumstances and enforceable by the
      Company.&#160;&#160;Employee agrees to be bound by any such modified covenant
      not to compete.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10.&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; FONT-STYLE: italic">Miscellaneous</font>.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(a)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; TEXT-DECORATION: underline">Governing
      Law</font>.&#160;&#160;In the absence of controlling Federal law, this Agreement
      shall be governed by and interpreted under the substantive law of the State
      of
      New Jersey.</font></div>
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      any provision of this Agreement shall be held to be invalid, void, or
      unenforceable, the remaining provisions hereof shall in no way be affected
      or
      impaired, and such remaining provisions shall remain in full force and
      effect.</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;<font style="DISPLAY: inline; TEXT-DECORATION: underline">Entire
      Agreement;
      Amendment</font>.&#160;&#160;This Agreement sets for the entire understanding of
      the parties with regarding to the subject matter contained herein and supersedes
      any and all prior agreements, arrangements or understandings relating to the
      subject matter hereof and may only be amended by written agreement signed by
      both parties hereto or their duly authorized representatives.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 72pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
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        </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(d)</font>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
        <font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">Successors
        and
        Assigns</font>.&#160;&#160;This Agreement shall be binding upon and </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">become
        the legal obligation of the successors and assigns of
        Employer.</font></div>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">[this
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      </div>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">IN
      WITNESS WHEREOF</font>, the
      parties hereto have executed this Agreement as of the date first above
      written.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div align="left">
      <table cellpadding="0" cellspacing="0" width="100%">

          <tr>
            <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td colspan="2" valign="top" width="50%">
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                BANK</font></div>
            </td>
          </tr>
          <tr>
            <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td valign="top" width="46%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
          </tr>
          <tr>
            <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td valign="top" width="46%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
          </tr>
          <tr>
            <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td valign="top" width="4%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">By:</font></div>
            </td>
            <td valign="top" width="46%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
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          <tr>
            <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td align="left" valign="top" width="46%">
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                L. Kovach</font></div>
            </td>
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              </font></td>
            <td valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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            </td>
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              </font></td>
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              </font></td>
            <td valign="top" width="46%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
          </tr>
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            <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td valign="top" width="46%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
          </tr>
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            <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
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            </td>
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          <tr>
            <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td valign="top" width="46%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
          </tr>
          <tr>
            <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td valign="top" width="4%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td valign="top" width="46%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
          </tr>
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            <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
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                Thompson</font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font>Sussex
      Bancorp guarantees the payments
      described in paragraphs 4(b), 6(c), 7 &amp; 8(c) of this Agreement and executes
      this Agreement solely for that purpose.</font></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div align="left">
      <table cellpadding="0" cellspacing="0" width="100%">

          <tr>
            <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td align="left" colspan="2" valign="top" width="50%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">SUSSEX
                BANCORP</font></div>
            </td>
          </tr>
          <tr>
            <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td valign="top" width="46%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
          </tr>
          <tr>
            <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td valign="top" width="46%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
          </tr>
          <tr>
            <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td align="left" valign="top" width="4%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">By:</font></div>
            </td>
            <td valign="top" width="46%" style="BORDER-BOTTOM: black 2px solid"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
          </tr>
          <tr>
            <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td align="left" valign="top" width="46%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Name:&#160;&#160;Donald
                L. Kovach</font></div>
            </td>
          </tr>
          <tr>
            <td valign="top" width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
              </font></td>
            <td align="left" valign="top" width="46%">
              <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Title:&#160;&#160;&#160;&#160;President
                and Chief Executive Officer</font></div>
            </td>
          </tr>

      </table>
    </div>
    <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
    <div>&#160;</div>
    <div style="TEXT-ALIGN: center"><font style="FONT-SIZE: 8pt; FONT-FAMILY: Times New Roman">8</font></div>
    <div>
      <div>
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