EMPLOYMENT AGREEMENT
This AGREEMENT (the "Agreement") is entered into as of the 8th day of
January, 2009 (the "Effective Date"), by and between EAST BOSTON SAVINGS BANK, a
bank organized under the laws of the Commonwealth of Massachusetts with its
headquarters located in East Boston, Massachusetts (the "Bank"), and Xxxxxxx X.
Xxxxxxxxx (the "Executive"). In consideration of the mutual covenants contained
in this Agreement, the Bank and the Executive agree as follows:
1 . Employment. The Bank agrees to employ the Executive and the Executive
agrees to be employed by the Bank on the terms and conditions set forth in this
Agreement.
2. Capacity. The Executive shall serve the Bank as Chief Executive Officer,
and as Chairman of the Board of Directors. The Executive shall also serve the
Bank in such other or additional offices as the Executive may be requested to
serve by the Board of Directors of the Bank (the "Board of Directors"). In such
capacity or capacities, the Executive shall perform such services and duties in
connection with the business, affairs and operations of the Bank as may be
assigned or delegated to the Executive from time to time by or under the
authority of the Board of Directors, and the Executive shall adhere to all
policies established by the Board of Directors or Committees thereof at all
times. If as a result of the Board of Directors directing the Executive to serve
in such "other" office(s) the Executive would have a right to terminate his
employment for Good Reason pursuant to Section 6(b)(i) below, then he will be
entitled to the benefits as are provided to him under Section 7(e) below.
3. Term.
(a) The term of this Agreement shall be (i) the initial term,
consisting of the period commencing on the Effective Date and ending on the
second anniversary of the Effective Date, plus (ii) any and all extensions
of the initial term made pursuant to this Section 3, unless terminated at
an earlier date pursuant to Section 6 below.
(b) The term of this Agreement shall be extended for one day each day
so that a constant twenty-four (24) calendar month term shall remain in
effect, until such time as the Board of Directors or the Executive elects
not to extend the term of the Agreement by giving written notice to the
other party in accordance with the terms of this Agreement, in which case
the term of this Agreement shall be fixed and shall end on the second
anniversary of the date of such written notice.
4. Compensation and Benefits. The regular compensation and benefits payable
to the Executive under this Agreement shall be as follows:
(a) Salary. For all services rendered by the Executive under this
Agreement, the Bank shall pay the Executive a salary (the "Salary") at the
annual rate of $350,000, subject to increase from time to time in the
discretion of the Board of Directors. The Salary shall be payable in
periodic installments in accordance with the Bank's usual practice for its
senior executives.
(b) Bonus. The Executive shall be entitled to participate in an annual
incentive program established by the Board of Directors with such terms as
may be established in the sole discretion of the Board of Directors.
(c) Regular Benefits. The Executive shall also be entitled to
participate in any employee benefit plans, medical insurance plans, life
insurance plans, disability income plans, retirement plans, vacation plans,
expense reimbursement plans and other benefit plans which the Bank may from
time to time have in effect for all or most of its senior executives, and
for which the Executive is eligible. Such participation shall be subject to
the terms of the applicable plan documents, generally applicable policies
of the Bank, and applicable law. Nothing contained in this Agreement shall
be construed to create any obligation on the part of the Bank to establish
any such plan or to maintain the effectiveness of any such plan which may
be in effect from time to time.
(d) Taxation of Payments and Benefits. The Bank shall undertake to
make deductions, withholdings and tax reports with respect to payments and
benefits under this Agreement to the extent that it reasonably and in good
faith believes that it is required to make such deductions, withholdings
and tax reports. Payments under this Agreement shall be in amounts net of
any such deductions or withholdings. Nothing in this Agreement shall be
construed to require the Bank to make any payments to compensate the
Executive for any adverse tax effect associated with any payments or
benefits or for any deduction or withholding from any payment or benefit.
(e) Exclusivity of Salary and Benefits. The Executive shall not be
entitled to any payments or benefits other than those provided under this
Agreement.
5. Extent of Service. During the Executive's employment under this
Agreement, the Executive shall, subject to the direction and supervision of the
Board of Directors, devote the Executive's full business time, best efforts and
business judgment, skill and knowledge to the advancement of the Bank's
interests and to the discharge of the Executive's duties and responsibilities
under this Agreement. The Executive shall not engage in any other business
activity, except as may be approved by the Board of Directors; provided that
nothing in this Agreement shall be construed as preventing the Executive from:
(a) investing the Executive's assets in any company or other entity in
a manner not prohibited by Section 9(d) and in such form or manner as shall
not require any material activities on the Executive's part in connection
with the operations or affairs of the companies or other entities in which
such investments are made; or
(b) engaging in religious, charitable or other community or non-profit
activities that do not impair the Executive's ability to fulfill the
Executive's duties and responsibilities under this Agreement.
6. Termination. The Executive's employment under this Agreement shall
terminate under the following circumstances set forth in this Section 6.
2
(a) Termination by the Bank for Cause. The Executive's employment
under this Agreement may be terminated for Cause without further liability
on the part of the Bank effective immediately upon a vote of the Board of
Directors and written notice to the Executive. Only the following shall
constitute "Cause" for such termination:
(i) the conviction of, the Executive for any felony involving
deceit, dishonesty or fraud;
(ii) a material act or acts of dishonesty in connection with the
performance of the Executive's duties, including without limitation,
material misappropriation of funds or property;
(iii) an act or acts of gross misconduct by the Executive; or
(iv) continued, willful and deliberate non-performance by the
Executive of duties (other than by reason of illness or disability)
which has continued for more than 30 days following written notice of
non-performance from the Board of Directors (or Executive Committee)
which specifically describes the alleged non-performance.
A determination of whether the Executive's employment shall be terminated for
Cause shall be made at a meeting of the Board of Directors called and held for
such purpose, at which the Board of Directors makes a finding that in the good
faith opinion of the Board of Directors an event set forth in subclauses (i),
(ii), (iii) or (iv) has occurred and specifying the particulars thereof in
detail. The Executive shall be permitted to appear before the Board of Directors
prior to any such determination, without legal counsel, to explain his position
on whether there is Cause for his termination. If the Executive disputes the
Board's determination of Cause, he may request arbitration pursuant to Section
10 below. The fact that the Board may have acted in good faith in making the
determination of Cause is not determinative of whether in fact the Board had
Cause to terminate the Executive.
(b) Termination by the Executive. The Executive's employment under
this Agreement may be terminated by the Executive by written notice to the
Board of Directors within sixty (60) days following an event constituting
"Good Reason." The Executive's termination of employment shall become
effective on the thirty-first (31st) day following such notice, provided
the Bank has not remedied the condition giving rise to the event of "Good
Reason." For purposes of this Agreement, "Good Reason" shall mean:
(i) a material diminution or other substantial adverse change,
not consented to by Executive, in the nature or scope of the
Executive's responsibilities and authorities;
(ii) any demotion of the Executive from his current title of
Chief Executive Officer or removal from his seat on the Board of
Directors;
3
(iii) a material reduction in the Executive's base salary except
for across-the-board reductions similarly affecting all or
substantially all officers;
(iv) involuntary relocation of the Bank's offices in which the
Executive is principally employed by more than 50 miles (10 miles in
the event of a Change in Control); or
(v) failure of the Bank to comply with material terms of this
Agreement or the Executive's executive supplemental retirement
agreement.
(c) Termination by the Bank Without Cause. The Executive's employment
under this Agreement may be terminated by the Bank without Cause (which,
for purposes of clarification, shall not include a termination of
Executive's employment under this Agreement due to Executive's death or
Disability) upon written notice to the Executive. A determination of
whether the Executive's employment shall be terminated without Cause will
be made solely by the Executive Committee of the Board of Directors.
(d) Termination by the Executive Other Than For Good Reason. The
Executive may terminate his employment other than for Good Reason by giving
30 days advance notice to the Bank.
(e) Disability. If the Executive shall be disabled so as to be unable
to perform the essential functions of the Executive's then existing
position or positions under this Agreement with or without reasonable
accommodation, for a total of more than 90 days in any calendar year, the
Board of Directors may terminate the Executive's employment upon written
notice to the Executive. If any question shall arise as to whether during
any period the Executive is disabled so as to be unable to perform the
essential functions of the Executive's then existing position or positions
with or without reasonable accommodation, the Executive may, and at the
request of the Bank shall, submit to the Bank a certification in reasonable
detail by a physician selected by the Bank to whom the Executive or the
Executive's guardian has no reasonable objection as to whether the
Executive is so disabled, and such certification shall for the purposes of
this Agreement be conclusive of the issue. The physician shall be
board-certified in the area of medicine applicable to the particular
disability involved. The Executive shall cooperate with any reasonable
request of the physician in connection with such certification. If such
question shall arise and the Executive shall fail to submit such
certification (unless the failure results from matters beyond the control
of the Executive), the Bank's determination will determine the issue of
whether the Executive is disabled. Nothing in this Section 6(d) shall be
construed to waive the Executive's rights, if any, under existing law
including, without limitation; the Family and Medical Leave Act of 1993, 29
U.S.C. ss.2601 et seq., the Americans with Disabilities Act, 42 U.S.C.
ss.12101 et seq, Massachusetts General Laws Chapter 151B, and Section 10
below..
(f) Death. The Executive's employment hereunder shall terminate upon
his death.
4
(g) Termination and Board Membership. To the extent Executive is a
member of the board of directors or trustees of the Bank or any of its
affiliates on the date of termination of employment with the Bank (other
than a termination due to normal retirement), Executive will resign from
all of the boards of directors and trustees immediately following such
termination of employment with the Bank. Executive will be obligated to
tender this resignation regardless of the method or manner of termination
(other than termination due to normal retirement), and such resignation
will not be conditioned upon any event or payment.
7. Certain Compensation Upon Termination.
(a) Compensation Upon Voluntary Termination. If the Executive shall
resign (including by retirement) and voluntarily terminate employment
without Good Reason, the Bank shall pay to the Executive the Executive's
accrued and unpaid salary, accrued and unpaid vacation pay and all rights
and benefits that the Executive is entitled to receive under the terms of
the Bank's benefit plans or arrangements, including the Executive's rights
under any Supplemental Executive Retirement Agreement in effect between the
Bank and the Executive (the "Accrued Obligations"), including the agreement
effective July 1, 2007.
(b) Compensation Upon Death. In the event the Executive's employment
shall terminate in the event of his death, his surviving spouse (or estate
if there is no surviving spouse) shall be entitled to receive the Accrued
Obligations, including a pro-rata bonus through the date of his death. His
surviving spouse (or estate if there is no surviving spouse) shall also be
entitled to any death benefit provided under the Bank's life insurance
plans and any Endorsement Split Dollar Agreement in effect between the Bank
and the Executive, including the agreement effective January 8, 2009.
(c) Compensation Upon Disability. In the event the Executive's
employment shall terminate by reason of disability as provided in Section
6(d) above, he shall be entitled to his Accrued Obligations, including a
pro-rata bonus through the date of his disability, and such disability
benefits as determined in accordance with any short or long-term disability
plans then in effect for executives of the Bank.
(d) Compensation Upon Termination by the Bank for Cause. In the event
the Executive's employment shall be terminated by the Bank for Cause as
provided by Section 6(a) above, he shall be entitled to receive his Accrued
Obligations only.
5
(e) Compensation Upon Termination of the Bank Without Cause or by the
Executive for Good Reason. In the event the Executive's employment shall be
terminated by the Bank without Cause as provided in Section 6(c) above, or
by the Executive for Good Reason as provided in Section 6(b) above, he
shall be entitled to receive the Accrued Obligations. In addition, subject
to the Executive's agreement to a release of any and all legal claims in a
form satisfactory to the Bank and the expiration of the applicable
revocation period and subject to compliance with the provisions of Section
9 hereof, the Bank shall pay the Executive an amount equivalent to the sum
of (i) two (2) times the Executive's Salary at the rate then in effect
pursuant to Section 4(a); and (ii) the value of 24 months of health
insurance premiums for health insurance coverage provided by the Bank,
based on the coverage provided to the Executive immediately prior to his
termination. The Bank shall make this in a single lump sum cash payment
within ten (10) days following the termination of employment, provided,
however, if Executive is a "specified employee" (as defined below) of a
publicly traded company, the payment may be delayed and paid to the
Executive on the first day of the seventh month following termination of
employment if required to avoid penalty under Section 409A of the Internal
Revenue Code ("Code"). For purposes of this Section 7(e), the Executive
shall not have a "termination of employment" until he has a "separation
from service" within the meaning of Code Section 409A and the regulations
promulgated thereunder. Also for purposes of this Section 7(e), Executive
is a specified employee if Executive is a "key employee" within the meaning
of Code Section 416(i) (without regard to paragraph (i) thereof). The form
of release referenced above is annexed hereto as Exhibit A.
(f) No mitigation. To the extent that the Executive receives any
payments pursuant to this Section 7, he shall not be required to seek to
mitigate any such payments by seeking other employment, and the Bank shall
not be entitled to offset any income earned by the Executive following his
termination against any money owed to the Executive to the Bank pursuant to
this Section 7.
8. Termination in Connection with a Change in Control.
(a) For purposes of this Agreement, a "Change in Control" means a
change in control of the Bank or Meridian Interstate Bancorp, Inc. (the
"Company") as defined in Section 409A of the Internal Revenue Code of 1986
(the "Code"), as amended, and rules, regulations, and guidance of general
application thereunder, including the following:
(i) Change in ownership: A change in ownership of the Bank or the
Company occurs on the date any one person or group of persons
accumulates ownership of more than 50% of the total fair market value
or total voting power of the Bank or the Company; or
(ii) Change in effective control: A change in effective control
occurs when either (i) any one person or more than one person acting
as a group acquires within a 12-month period ownership of stock of the
Company possessing 30% or more of the total voting power of the
Company; or (ii) a majority of the Bank's or Company's Board of
Directors is replaced during any 12-month period by Directors whose
appointment or
6
election is not endorsed in advance by a majority of the Bank's or
Company's Board of Directors (as applicable), or
(iii) Change in ownership of a substantial portion of assets: A
change in the ownership of a substantial portion of the Company's
assets occurs if, in a 12 month period, any one person or more than
one person acting as a group acquires assets from the Company having a
total gross fair market value equal to or exceeding 40% of the total
gross fair market value of the Company's entire assets immediately
before the acquisition or acquisitions. For this purpose, "gross fair
market value" means the value of the Company's assets, or the value of
the assets being disposed of, determined without regard to any
liabilities associated with the assets.
Notwithstanding anything in this Agreement to the contrary, in no event
shall a reorganization of Meridian Financial Services, Incorporated, the Company
or Bank solely within its corporate structure constitute a "Change in Control"
for purposes of this Agreement.
(b) Termination. If within the period ending one year after a Change
in Control, (i) the Bank terminates the Executive's employment without
Cause, or (ii) the Executive voluntarily terminates his employment with
Good Reason, the Bank will, within ten (10) calendar days of the
termination of the Executive's employment, make a lump-sum cash payment to
him equal to 2.99 times his "base amount" (as defined for purposes of
Section 280G of the Code) less any other "parachute payments" (as also
defined for purposes of Section 280G of the Code) made to the Executive.
The cash payment made under this Section 8(b) shall be made in lieu of any
payment also required under Section 7 of this Agreement because of the
Executive's termination of employment. For purposes of this Section 8)(b),
the Executive shall not have a "termination of employment" until he has a
"separation from service" within the meaning of Section 409A of the
Internal Revenue Code ("Code") and the regulations promulgated thereunder.
(c) The provisions of Section 9 , including the defined terms used in
such sections, shall continue in effect until the later of the expiration
of this Agreement or one year following a Change in Control, except the
non-compete provisions in Section 9(d) shall not be applicable in the event
of a Change in Control.
(d) Limitation of Benefits Under Certain Circumstances. If the
payments and benefits pursuant to this Section 8 of this Agreement, either
alone or together with other payments and benefits the Executive has the
right to receive from the Bank, would constitute a "parachute payment"
under Section 280G of the Code, the payments and benefits shall be reduced
or revised, by the amount, if any, which is the minimum necessary to result
in no portion of the payments and benefits under this Agreement or
otherwise being non-deductible to the Bank pursuant to Section 280G of the
Code and subject to the excise tax imposed under Section 4999 of the Code.
The reduction will be made in the manner determined by the Executive,
unless it is determined that permitting the Executive to make the
determination would violate
7
Code Section 409A. In such case, the reduction will be made first from the
cash severance payment payable under this Section 8.. The Bank's
independent public accountants will determine any reduction in the payments
and benefits to be made pursuant to this Agreement or otherwise; the Bank
will pay for the accountant's opinion. If the Bank and/or the Executive do
not agree with the accountant's opinion, the Bank will pay to the Executive
the maximum amount of payments and benefits pursuant to this Section 8, as
selected by the Executive, that the opinion indicates have a high
probability of not causing any of the payments and benefits to be
non-deductible to the Bank and subject to the excise tax imposed under
Section 4999 of the Code. The Bank may also request, and the Executive has
the right to demand that the Bank request, a ruling from the Internal
Revenue Service ("IRS") as to whether the disputed payments and benefits
pursuant to this Section 8 have such tax consequences. The Bank will
promptly prepare and file the request for a ruling from the IRS, but in no
event will the Bank make this filing later than thirty (30) days from the
date of the accountant's opinion referred to above. The request will be
subject to the Executive's approval prior to filing; the Executive shall
not unreasonably withhold his approval. The Bank and the Executive agree to
be bound by any ruling received from the IRS and to make appropriate
payments to each other to reflect any IRS rulings, together with interest
at the applicable federal rate provided for in Section 7872(f)(2) of the
Code. Nothing contained in this Agreement shall result in a reduction of
any payments or benefits to which the Executive may be entitled upon
termination of employment other than pursuant to this Section 8, or a
reduction in the payments and benefits specified in this Section 8, below
zero.
9. Confidential Information, Noncompetition and Cooperation.
(a) Confidential Information. As used in this Agreement, "Confidential
Information" means information belonging to the Bank which is of value to
the Bank in the course of conducting its business and the disclosure of
which could result in a competitive or other disadvantage to the Bank.
Confidential Information includes, without limitation, financial
information, reports, and forecasts; inventions, improvements and other
intellectual property; trade secrets; know-how; designs, processes or
formulae; software; market or sales information or plans; customer lists;
and business plans, prospects and opportunities (such as possible
acquisitions or dispositions of businesses or facilities) which have been
discussed or considered by the management of the Bank. Confidential
Information includes information developed by the Executive in the course
of the Executive's employment by the Bank, as well as other information to
which the Executive may have access in connection with the Executive's
employment. Confidential Information also includes the confidential
information of others with which the Bank has a business relationship.
Notwithstanding the foregoing, Confidential Information does not include
information in the public domain, unless due to breach of the Executive's
duties under Section 9(b).
(b) Confidentiality. The Executive understands and agrees that the
Executive's employment creates a relationship of confidence and trust
between the Executive and the Bank with respect to all Confidential
Information. At all times, both during the Executive's employment with the
Bank and after its termination, the Executive will keep in confidence and
trust all such Confidential Information, and will not use or disclose any
such Confidential Information
8
without the written consent of the Bank, except as may be necessary in the
ordinary course of performing the Executive's duties to the Bank.
(c) Documents, Records, etc. All documents, records, data, apparatus,
equipment and other physical property, whether or not pertaining to
Confidential Information, which are furnished to the Executive by the Bank
or are produced by the Executive in connection with the Executive's
employment will be and remain the sole property of the Bank. The Executive
will return to the Bank all such materials and property as and when
requested by the Bank. In any event, the Executive will return all such
materials and property within ten business days of the termination of the
Executive's employment for any reason. The Executive will not retain with
the Executive any such material or property or any copies thereof after
such termination except for a copy of his personnel file and any documents
pertaining to his termination of employment..
(d) Noncompetition and Nonsolicitation. During the period in which the
Executive is employed by the Bank and for two (2) years thereafter, the
Executive (i) will not, directly or indirectly, whether as owner, partner,
shareholder, consultant, agent, employee, co-venturer or otherwise, engage,
participate, assist or invest in any Competing Business (as hereinafter
defined); (ii) will refrain from directly or indirectly employing,
attempting to employ, recruiting or otherwise soliciting, inducing or
influencing any person to leave employment with the Bank (other than
terminations of employment of subordinate employees undertaken in the
course of the Executive's employment with the Bank); and (iii) will refrain
from soliciting or encouraging any customer or supplier to terminate or
otherwise modify adversely its business relationship with the Bank.
Notwithstanding the foregoing, in the event that the Bank terminates the
Executive with Cause, or the Executive terminates his employment other than
for Good Reason, the restrictions in subsection (d)(i) will not apply to
the Executive. The intent of the parties is to avoid restricting the
ability of the Executive to obtain other employment if his employment with
the Bank terminates and he is not being paid during the period of the
noncompetition obligation. The Executive understands that the restrictions
set forth in this Section 9(d) are intended to protect the Bank's interest
in its Confidential Information and established employee, customer and
supplier relationships and goodwill, and agrees that such restrictions are
reasonable and appropriate for this purpose. For purposes of this
Agreement, the term "Competing Business" shall mean a business conducted
anywhere in Suffolk, Middlesex, Essex and Norfolk Counties, or within a
30-mile radius of the Bank's headquarters (other than the State of New
Hampshire), which is competitive with any business which the Bank or any of
its affiliates conducts or proposes to conduct at any time during the
employment of the Executive. Notwithstanding the foregoing, the Executive
may own up to one percent (1%) of the outstanding stock of a publicly held
corporation which constitutes or is affiliated with a Competing Business
and may serve on the Board of Directors of the entities listed on Appendix
B.
(e) Litigation and Regulatory Cooperation. During and after the
Executive's employment, the Executive shall cooperate fully with the Bank
in the defense or prosecution of any claims or actions now in existence or
which may be brought in the future against or on behalf of the Bank which
relate to events or occurrences that transpired while the Executive was
employed by the Bank. The Executive's full cooperation in connection with
such claims or
9
actions shall include, but not be limited to, being available to meet with
counsel to prepare for discovery or trial and to act as a witness on behalf
of the Bank at mutually convenient times. During and after the Executive's
employment, the Executive also shall cooperate fully with the Bank in
connection with any investigation or review of any federal, state or local
regulatory authority as any such investigation or review relates to events
or occurrences that transpired while the Executive was employed by the
Bank. The Bank shall reimburse the Executive for any reasonable
out-of-pocket expenses incurred in connection with the Executive's
performance of obligations pursuant to this Section 9(e).
(f) Injunction. The Executive agrees that it would be difficult to
measure any damages caused to the Bank which might result from any breach
by the Executive of the promises set forth in this Section 9, and that in
any event money damages would be an inadequate remedy for any such breach.
Accordingly, subject to Section 10 of this Agreement, the Executive agrees
that if the Executive breaches, or proposes to breach, any portion of this
Agreement, the Bank shall be entitled, in addition to all other remedies
that it may have, to seek an injunction or other appropriate equitable
relief to restrain any such breach without showing or proving any actual
damage to the Bank.
10. Arbitration of Disputes. Any controversy or claim arising out of or
relating to this Agreement or the breach thereof or otherwise arising out of the
Executive's employment or the termination of that employment (including, without
limitation, any claims of unlawful employment discrimination whether based on
age or otherwise) shall, to the fullest extent permitted by law, be settled by
binding arbitration under the auspices of JAMS (Judicial Arbitration and
Mediation Service), Xxx Xxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx in accordance with
the Employment Arbitration Rules and Procedures Judgment upon the award rendered
by the arbitrator may be entered in any court having jurisdiction thereof. This
Section 10 shall be specifically enforceable. Notwithstanding the foregoing,
this Section 10 shall not preclude either party from pursuing a court action for
the sole purpose of obtaining a temporary restraining order or a preliminary
injunction in circumstances in which such relief is appropriate; provided that
any other relief shall be pursued through an arbitration proceeding pursuant to
this Section 10, and the arbitrator shall have the power to revoke, revise, or
otherwise modify any preliminary ruling by a court. The cost of all arbitration
proceedings shall be paid equally by the parties. Each party shall initially
bear his or its own attorney's fees in connection with any arbitration, but the
arbitrator shall have the power to allocate the final payment of legal fees so
as to do substantial justice.
11. Consent to Jurisdiction. To the extent that any court action is
permitted consistent with or to enforce Section 10 of this Agreement, the
parties hereby consent to the jurisdiction of the Superior Court of the
Commonwealth of Massachusetts and the United States District Court for the
District of Massachusetts. Accordingly, with respect to any such court action,
the Executive (a) submits to the personal jurisdiction of such courts; (b)
consents to service of process; and (c) waives any other requirement (whether
imposed by statute, rule of court, or otherwise) with respect to personal
jurisdiction or service of process.
10
12. Integration. This Agreement constitutes the entire agreement between
the parties with respect to the subject matter hereof and supersedes all prior
agreements between the parties with respect to any related subject matter.
13. Assignment; Successors and Assigns, etc. Neither the Bank nor the
Executive may make any assignment of this Agreement or any interest herein, by
operation of law or otherwise, without the prior written consent of the other
party; provided that the Bank may assign its rights under this Agreement without
the consent of the Executive in the event that the Bank shall effect a
reorganization, consolidate with or merge into any other corporation,
partnership, organization or other entity, or transfer all or substantially all
of its properties or assets to any other corporation, partnership, organization
or other entity. In the event of such assignment, the Bank will require the
reorganized, consolidated, or merged entity to assume the Bank's obligations to
the Executive pursuant to this Agreement, and to recognize that the Executive is
a third-party beneficiary of any such action.This Agreement shall inure to the
benefit of and be binding upon the Bank and the Executive, their respective
successors (whether in the case of the Bank by merger or otherwise), executors,
administrators, heirs and permitted assigns.
14. Enforceability. If any portion or provision of this Agreement
(including, without limitation, any portion or provision of any section of this
Agreement) shall to any extent be declared illegal or unenforceable by a court
of competent jurisdiction, then the remainder of this Agreement, or the
application of such portion or provision in circumstances other than those as to
which it is so declared illegal or unenforceable, shall not be affected thereby,
and each portion and provision of this Agreement shall be valid and enforceable
to the fullest extent permitted by law.
15. Indemnification. In the event that the Executive is sued for any
actions arising out of or relating to his employment with the Bank, the Bank
will indemnify the Executive and hold him harmless against any money damages
which the Executive is ordered to pay as a result of the litigation, and will
indemnify the Executive for his reasonable attorney's fees incurred in
connection with the defense of any such action by paying the Executive's
reasonable attorney's fees on an ongoing basis until the claim or litigation is
resolved.
16. Waiver. No waiver of any provision hereof shall be effective unless
made in writing and signed by the waiving party. The failure of any party to
require the performance of any term or obligation of this Agreement, or the
waiver by any party of any breach of this Agreement, shall not prevent any
subsequent enforcement of such term or obligation or be deemed a waiver of any
subsequent breach.
17. Notices. Any notices, requests, demands and other communications
provided for by this Agreement shall be sufficient if in writing and delivered
in person or sent by a nationally recognized overnight courier service or by
registered or certified mail, postage prepaid, return receipt requested, to the
Executive at the last address the Executive has filed in writing with the Bank
or, in the case of the Bank, at its main offices, attention of the Board of
Directors, and shall be effective on the date of delivery in person or by
courier or three (3) days after the date mailed.
11
18. Amendment. This Agreement may be amended or modified only by a written
instrument signed by the Executive and by a duly authorized representative of
the Bank.
19. Governing Law. This is a Massachusetts contract and shall be construed
under and be governed in all respects by the laws of the Commonwealth of
Massachusetts, without giving effect to the conflict of laws principles of such
Commonwealth. With respect to any disputes concerning federal law, such disputes
shall be determined in accordance with the law as it would be interpreted and
applied by the United States Court of Appeals for the First Circuit.
20. Federal Deposit Insurance Act Compliance. All payments made by the Bank
to the Executive under any provision of this Agreement shall be subject to and
conditioned upon compliance with Section 18(k) of the Federal Deposit Insurance
Act, 12 U.S.C. ss. 1828(k) and any regulations promulgated hereunder.
21. Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be taken to be
an original; but such counterparts shall together constitute one and the same
document.
12
IN WITNESS WHEREOF, this Agreement has been executed as a sealed instrument
by the Bank, by its duly authorized officer, and by the Executive, as of the
Effective Date.
EAST BOSTON SAVINGS BANK
By: /s/ Xxxxxxx X. Xxxxxxxxxxx
-----------------------------------
Xxxxxxx X. Xxxxxxxxxxx
Duly Authorized for Board of Directors
EXECUTIVE
/s/ Xxxxxxx X. Xxxxxxxxx
---------------------------------------
Xxxxxxx X. Xxxxxxxxx
