Exhibit 10.1
SEPARATION AGREEMENT
This Separation Agreement
(the "Agreement") is made as of the 6th day of
April, 2009, between East Boston Savings Bank ("EBSB" or the
"Bank) and Leonard
V. Siuda ("Mr. Siuda").
In consideration of the mutual
covenants and agreements herein contained
and other good and valuable consideration, the receipt and
sufficiency of which
is hereby acknowledged, the parties agree as follows:
1.
Resignation/Retirement.
Effective April
29, 2009 (the
"Resignation/Retirement Date"), Mr. Siuda retires from
employment with the Bank
and resigns from his positions as Treasurer and Chief
Financial Officer, and
from any other positions that he holds with EBSB,
Meridian Interstate Bancorp,
Inc., Meridian Financial Services, Inc., Meridian Charitable
Foundation, Inc.,
Hampshire First Bank, Prospect, Inc., ESOP Funding Corp., or any
other affiliate
of EBSB. If so requested by the Bank,
Mr. Siuda shall sign any document
reasonably requested by the Bank to confirm any such actions.
2. Accrued Compensation. On
April 29, 2009, the Bank shall pay Mr. Siuda
(a) $5,603.48 for all
salary earned but not yet
paid through the
Resignation/Retirement Date, and (b) the amount of $8,685.39
in payment for his
12.4 accrued but unused vacation days.
3. Employment Agreement -
Salary Continuation. In consideration for Mr.
Siuda's release of claims set forth in
Section 10 below and the execution,
delivery and non-revocation by Mr. Siuda of a
second release of claims in the
form of Exhibit A hereto
(the "Second Release") no
sooner than the
Resignation/Retirement Date and
no later than 30
days after the
Resignation/Retirement Date, the Bank agrees to pay Mr. Siuda an
amount equal to
$364,226 in equal installments over 24 months
pursuant to Section 6(e) of the
December 29, 2003 Employment
Agreement between Mr. Siuda and
EBSB (the
"Employment Agreement"), subject to the provisions of Section
7 below, with the
first payment commencing on October 30, 2009. The first
payment made on October
30, 2009 shall include a catch-up payment
covering amounts that would have
otherwise been paid during April 30, 2009 through
October 29, 2009 but for the
six-month delay due to the application
of Section 409A of the Code,
as
referenced in Section 7 of this
Agreement. Mr. Siuda's post-termination
obligations under the Employment Agreement, including
but not limited to those
set forth in Section 7 thereof, shall remain in full force
and effect following
the Resignation/Retirement Date.
4. Supplemental Executive
Retirement Agreement. The Amended and Restated
Supplemental Executive Retirement Agreement between Mr. Siuda and
EBSB, dated as
of January 1, 2007 (the "SERP"), remains in full force and effect.
Mr. Siuda has
elected to have the Bank pay his SERP benefits in a lump sum
payment pursuant to
Section 2(d) of the SERP, in an amount equal
to $1,281,818 as adjusted for
interest calculated at the Prime Rate as reported in The Wall
Street Journal on
May 1, 2009 for the period beginning on May 1, 2009 and ending
October 29, 2009,
subject to the provisions of Section 6 below,
with the lump sum payment to be
made on October 30, 2009.
5. Split Dollar and Bank Owned Life
Insurance. The Split Dollar Agreement
between Mr. Siuda and EBSB, dated December
29, 2003 (the "SDA") and the Bank
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Owned Life Insurance covering Mr. Siuda, remain in full force and
effect, and it
is acknowledged that the SDA and Bank Owned Life Insurance
each provide a death
benefit equal to $455,283 and $364,226,
respectively, payable to Mr. Siuda's
beneficiary upon his death.
6. Death. In the event of Mr.
Siuda's death before all payments are made
pursuant to Sections 2, 3 and 4 of this Agreement, all
payments will be made to
Mr. Siuda's beneficiary, as identified in the SDA, at the same time
the payments
would have been made if Mr. Siuda had not died,
subject to Section 7 of this
Agreement.
7. Section 409A.
EBSB has determined that Mr. Siuda is
a "specified
employee" within the meaning of Section 409A(a)(2)(B)(i) of the
Internal Revenue
Code (the "Code"). Because the salary
continuation payments referenced in
Section 3 above and the lump sum distribution that Mr.
Siuda has elected under
his SERP referenced in Section 4 above will be considered
deferred compensation
subject to Section 409A of the Code, such
payments shall not be payable until
the date that is the earlier of (i) six months and one day after
his separation
from service, or (ii) Mr. Siuda's death. The first
salary continuation shall
include a catch-up payment covering amounts that would
otherwise have been paid
during the six-month period but for the application of this
provision, and the
balance of the installments shall be payable in
accordance with their original
schedule.
8. Taxation of
Payments and Benefits. EBSB 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. Except to the extent
otherwise specified, nothing in this
Agreement shall be construed to require EBSB to make any
payments to compensate
Mr. Siuda for any adverse tax effect associated with any payments
or benefits or
for any deduction or withholding from any payment or benefit.
9. Health Insurance and Other
Benefits. EBSB shall provide Mr. Siuda with
the right to continue group medical and dental
insurance coverage after the
Resignation/Retirement Date, at his own expense, under the law
known as "COBRA."
The terms for that opportunity will be set forth in a
separate written notice.
The Bank agrees to maintain or cause to be maintained in
effect, and to pay or
cause to be paid the applicable premiums
under, the long term care policies
currently in effect for Mr. Siuda and his spouse (UNUM Policy Nos.
LAC716035 and
LAC716037) respectively, until their respective deaths. Mr.
Siuda's eligibility
to participate in any other employee benefit plans and
programs of the Company
ceases on or after the Resignation/Retirement Date in accordance
with applicable
benefit plan or program terms.
10. Release of Claims. Mr. Siuda
acknowledges that, pursuant to 6(e) of the
Employment Agreement, he is required to execute a
release of any and all legal
claims in a form satisfactory to the Bank as a condition of
his eligibility for
salary continuation payments under said Section 7(e). Accordingly,
Mr. Siuda, in
consideration for said salary continuation
payments (which are referenced in
Section 3 above), to which he acknowledges he otherwise
would not be entitled,
voluntarily releases and forever discharges the Bank, its
affiliated and related
entities (including Meridian Interstate
Bancorp, Inc., Meridian Financial
Services, Inc., Meridian Charitable
Foundation, Inc., Hampshire First Bank,
Prospect, Inc. and ESOP Funding Corp.), its and their
respective predecessors,
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successors and assigns, its and their
respective employee benefit plans and
fiduciaries of such plans, and the current
and former officers, directors,
shareholders, employees, attorneys,
accountants and agents of each of the
foregoing in their official and personal capacities (collectively
referred to as
the "Releasees") generally from all
claims, demands, debts, damages and
liabilities of every name and nature, known or unknown
("Claims") that, as of
the date when he signs this Agreement, Mr. Siuda
has, ever had, now claims to
have or ever claimed to have had against
any or all of the Releasees. This
release includes, without limitation, all Claims:
o relating to Mr. Siuda's employment by
and termination of employment with
the Bank and any of its affiliated and
related entities;
o of wrongful discharge;
o of breach of contract;
o of discrimination or
retaliation under federal, state or
local law
(including, without limitation, Claims of
age discrimination or retaliation
under the Age Discrimination in Employment
Act);
o under any other federal or state statute;
o of defamation or other torts;
o of violation of public policy;
o for wages, bonuses, incentive
compensation, stock, stock options, vacation
pay or any other compensation or benefits;
and
o for damages or other remedies of any
sort, including, without limitation,
compensatory damages, punitive
damages, injunctive relief and attorney's
fees;
provided, however, that this release shall not affect Mr.
Siuda's vested rights
under the Bank's Section 401(k) plan, his
righ
