exv10w43






Exhibit 10.43









February 11,
2009




Kirk Walters

c/o Sovereign Bancorp, Inc.




          Re:  Agreement
and General Release




Dear Kirk:




          This Agreement and General Release (“Agreement and Release”) confirms our discussions
regarding your employment with Sovereign Bancorp, Inc. (and/or its related entities, defined as
“Sovereign”).



          In consideration for your signing and returning (and not revoking) this Agreement and
Release, Sovereign will provide you with the following benefits to which you are not otherwise
entitled:




	 	(i)	 	$8,137,695 which represents an amount approximately equal to
the change in control or termination benefits set forth in your prior
employment agreement and/or change in control agreement with Sovereign (less
applicable deductions and withholdings). Sovereign will provide this payment
to you notwithstanding that you have chosen not to resign for Good Reason.
Sovereign shall make such payment no later than five (5) business days after
the expiration of the revocation period described below (provided that you
have signed and returned this Agreement and Release and have returned the
attached letter confirming that you have not revoked this Agreement and
Release); and
	 
	 	(ii)	 	an employment agreement as attached hereto as Exhibit A.





          The amount set forth above includes the “Gross-Up Payment” under Section 8(a) of your prior
employment agreement with Sovereign. If you are required to pay any additional excise tax under
Section 4999 of the Internal Revenue Code of 1986, as amended (“Excise Tax”), in respect of (i) the
above amount paid by Sovereign and/or (ii) any other amounts paid,



 









 







distributed, or treated as paid or distributed, by Sovereign or compensation earned by you in
connection with Sovereign’s recent acquisition by Banco Santander, S.A. which amounts or
compensation are treated as excess parachute payments under Section 280G of the Internal Revenue
Code of 1986, as amended, then Sovereign will promptly pay to you, or on your behalf, the amount
of the Gross-Up Payment that was not, but should have been, paid by Sovereign to you, as
determined by a nationally-recognized accounting firm chosen by Sovereign in its sole discretion.
Sovereign’s obligation to pay such amount is conditioned on your agreement to notify Sovereign
promptly in writing of any claim by the Internal Revenue Service that, if successful, would
require the payment by Sovereign of an additional Gross-Up Payment. If Sovereign notifies you in
writing that it desires to contest such claim, you agree to cooperate with Sovereign in contesting
the claim; provided, however, that Sovereign will pay directly all reasonable costs and expenses
(including additional interest and penalties) incurred in connection with such contest and will
indemnify and hold you harmless, on an after-tax basis, from any Excise Tax or income tax
(including interest and penalties with respect thereto) imposed as a result of such representation
and payment of costs and expenses. Any Gross-Up Payment or other payment pursuant to this
paragraph will be paid no later than the date the related taxes are due.



          In order to be eligible to receive the payment and other benefits described above to which
you are not otherwise entitled, you are required to agree to the terms contained in this Agreement
and Release, including the General Release provisions set forth below, indicate your agreement by
signing and returning this Agreement and Release, and not revoke this Agreement and Release as
provided below.



          In consideration for receiving the change in control or termination benefits amount described
above without your having to resign for Good Reason and for the offer of the employment agreement,
you hereby agree to release Sovereign and any and all of Sovereign’s predecessors, successors,
assigns, subsidiaries, parents, branches, divisions, affiliates, related entities and present and
former officers, directors, employees and agents (of either Sovereign or any and all of Sovereign’s
predecessors, successors, assigns, subsidiaries, parents, branches, divisions, affiliates and
related entities) (including, but not limited to, Banco Santander, S.A. and its parents,
subsidiaries, affiliates or related entities) (collectively “Sovereign Entities & Officials”),
individually and in their official capacities, of and from all causes of action, claims, damages,
judgments or agreements of any kind arising up to and including the date of your execution of this
Agreement and Release, including, but not limited to, all matters arising out of your employment
with Sovereign (or its parents, subsidiaries, affiliates or related entities), and of and from any
change in control or termination provisions. This release includes, but is not limited to, any and
all alleged claims based on Title VII of the Civil Rights Act of 1964, the Civil Rights Act of
1866, the Age Discrimination in Employment Act (including the Older Workers Benefit Protection
Act), the Americans with Disabilities Act, the New York State and New York City Human Rights Laws,
the New York Labor Law, the Pennsylvania Human Relations Act, the Pennsylvania Wage Payment and
Collection Law, the Massachusetts Fair Employment Practices Act, the Massachusetts Age
Discrimination Law, the Massachusetts Equal Rights Act, the Employee Retirement Income Security Act
of 1974, the Family and Medical Leave Act of 1993, the Worker Adjustment and Retraining
Notification Act, or any common law, public policy, contract (whether oral or written, express or
implied) or tort law, or any other local, state, federal or foreign law, regulation, ordinance or
rule having any bearing whatsoever on the terms and conditions of your employment and the cessation
thereof. By signing this Agreement and



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Release, you are providing a complete waiver of all claims that may have arisen, whether known
or unknown, up until the time that this Agreement and Release is executed by you. Notwithstanding
the foregoing, this release is not intended to release any rights: (i) to indemnification, if any,
pursuant to Sovereign policy or applicable law; and/or (ii) to any vested or unvested restricted
stock and/or restricted stock units of Sovereign, if any (your rights, if any, to indemnification
or to the stock and/or restricted stock units will be governed by the applicable policy, plan or
law).



          You acknowledge and agree that any employment agreement, offer letter and/or any agreement
regarding change in control or termination benefits, previously entered into between you and
Sovereign are immediately null and void.



          In addition, you will keep in confidence and will not, except as specifically authorized in
writing by Sovereign or as otherwise required by law, disclose to any third party or use for the
benefit of yourself or any third party any confidential or proprietary information about Sovereign
(or its parents, subsidiaries, affiliates or related entities) which you acquired, developed or
created by reason of your employment, except for information that is or becomes public other than
through your breach of this paragraph.



          You agree that you will cooperate with Sovereign (or its parents, subsidiaries, affiliates or
related entities) and its legal counsel in connection with any current or future investigation or
litigation relating to any matter with which you were involved or of which you have knowledge or
which occurred during your employment. Such assistance will include, but not be limited to,
depositions and testimony and will continue until such matters are resolved. Sovereign will
provide you with reasonable notice whenever possible of the need for your cooperation. To the
extent practicable, Sovereign will limit your cooperation to regular business hours (and, to the
extent practicable, will take into account your other personal and Business commitments). In any
event, following your employment with Sovereign, in complying with this paragraph, you will not be
required to act against the reasonable best interests of any new employer or new business venture
in which you are an employee, partner or active participant. Furthermore, Sovereign will reimburse
you for all reasonable expenses and costs you may incur as a result of providing such assistance,
including travel costs and pre-approved legal fees (which approval will not be unreasonably
withheld), provided Sovereign receives proper documentation with respect to all such expenses and
costs. Following your employment with Sovereign, you will be entitled to a reasonable hourly fee
(which fee will be mutually determined by Sovereign and you after consideration of your
compensation history) for time spent by you furnishing such cooperation (other than for time spent
by you actually providing testimony in any legal matter), including, without limitation, for time
spent travelling in connection with such cooperation. Such fee will be paid promptly following
your submission of a statement setting forth the number of hours spent by you on such cooperation.



          If you breach this Agreement and Release, in addition to any other remedies available,
Sovereign will seek restitution and/or offset of any payments or benefits provided to the extent
permitted by law.



          This Agreement and Release does not affect your entitlement to previously accrued or vested
benefits to which you may be entitled under any Sovereign savings and/or pension plans. Your rights
to benefits under any Sovereign savings and/or pension plan will be determined by law and in
accordance with the terms of the specific plan.



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          Since your execution of this Agreement and Release releases Sovereign and any Sovereign Entities &
Officials from all claims you may have (except as otherwise set forth above), you should review
this carefully before signing it. You can take at least twenty-one (21) days from your receipt of
this Agreement and Release to consider its meaning and effect and to determine whether you wish to
enter into it. During that time, you are advised to consult with anyone of your choosing,
including an attorney, prior to executing this Agreement and Release. Any modifications to this
Agreement and Release (and the attached Exhibit A), whether material or immaterial, will not
restart the twenty-one (21) day period.



          Once you have signed this Agreement and Release, you may choose to revoke your execution
within seven (7) days. Any revocation of this Agreement and Release must be in writing and
personally delivered to Thomas J. McAuliffe, Sovereign Bancorp, Inc., 75 State Street, Boston,
Massachusetts 02109, or if mailed, postmarked within seven (7) days of the date upon which it was
signed by you.



          TO RECEIVE THE PAYMENT AND OTHER BENEFITS DESCRIBED ABOVE, YOU MUST SIGN (AND HAVE NOTARIZED)
AND RETURN THE AGREEMENT AND RELEASE NO LATER THAN MARCH 10, 2009, AND DELIVER THE ATTACHED LETTER
INDICATING THAT YOU HAVE NOT REVOKED YOUR AGREEMENT NO EARLIER THAN SEVEN (7) DAYS AFTER THE DATE
YOU SIGN THIS AGREEMENT AND RELEASE. YOU MUST ALSO SIGN AND RETURN THE EMPLOYMENT AGREEMENT
ATTACHED HERETO AS EXHIBIT A NO LATER THAN MARCH 10, 2009. This Agreement and Release should be
returned to Thomas J. McAuliffe, Sovereign Bancorp, Inc., 75 State Street, Boston, Massachusetts
02109. Sovereign will not make any payments or provide any other benefits pursuant to this
Agreement and Release until after the seven (7) day period expires and Sovereign receives the
attached letter indicating that you have not revoked your agreement.



          If any portion of this Agreement and Release is found to be unenforceable but such portion
would be enforceable if some part thereof were deleted or modified, then such portion will apply
with such deletion or modification as is necessary to make it enforceable to the fullest extent
permitted by law. If any such portion cannot be modified to be enforceable, such portion will be
deemed severed from this Agreement and Release and will not affect the validity or enforceability
of the remainder of this Agreement and Release.



          This Agreement and Release will be null and void if you do not sign and return the employment
agreement attached hereto as Exhibit A within the applicable time period.



[THIS SPACE INTENTIONALLY LEFT BLANK]






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          This Agreement and Release (including Exhibit A) contains the entire understanding of the
parties relating to the subject matter hereof. You acknowledge that no representations, oral or
written, have been made other than those expressly set forth herein, and that you have not relied
on any other representations in executing this Agreement and Release. This Agreement and Release
may be modified only in a document signed by the parties and referring specifically hereto.



          If you have any questions, please contact Tom Stypulkoski at (610) 526-6340.



Sincerely yours,




Sovereign Bancorp, Inc.









Thomas J. McAuliffe

Executive Vice President and

Managing Director of Human Resources




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ACKNOWLEDGEMENT




          I AGREE TO THE TERMS AND CONDITIONS SPECIFIED IN THIS AGREEMENT AND RELEASE AND I INTEND TO
WAIVE AND RELEASE ALL CLAIMS THAT I MAY HAVE AGAINST SOVEREIGN AND ANY SOVEREIGN ENTITIES &
OFFICIALS. I UNDERSTAND THAT THIS WAIVER AND RELEASE CREATES A TOTAL AND UNLIMITED RELEASE OF ALL
CLAIMS, WHETHER KNOWN OR UNKNOWN, EXISTING AS OF THIS DATE THAT I MAY HAVE AGAINST SOVEREIGN AND
ANY SOVEREIGN ENTITIES & OFFICIALS, EXCEPT AS OTHERWISE SET FORTH ABOVE.



          I HAVE HAD AMPLE TIME TO REVIEW THIS AGREEMENT AND TO CONSIDER MY GENERAL RELEASE OF ALL
CLAIMS AS SET FORTH IN THIS AGREEMENT AND RELEASE. I AM SIGNING THIS AGREEMENT AND RELEASE
KNOWINGLY, VOLUNTARILY AND WITH FULL UNDERSTANDING OF ITS TERMS AND EFFECTS. I UNDERSTAND THAT I
CAN TAKE AT LEAST TWENTY-ONE (21) DAYS FROM RECEIPT OF THIS AGREEMENT AND RELEASE TO DETERMINE
WHETHER I WISH TO SIGN IT, THAT I HAVE BEEN ADVISED TO CONSULT WITH AN ATTORNEY PRIOR TO SIGNING
IT, AND THAT I HAVE SEVEN (7) DAYS FROM THE DATE I SIGN THIS AGREEMENT AND RELEASE TO REVOKE IT.



          I ACKNOWLEDGE THAT I HAVE NOT RELIED ON ANY REPRESENTATIONS OR STATEMENTS NOT SET FORTH
HEREIN. I WILL NOT DISCLOSE THIS AGREEMENT AND RELEASE TO ANYONE EXCEPT TO MY IMMEDIATE FAMILY AND
ANY TAX, LEGAL OR OTHER COUNSEL THAT I HAVE CONSULTED REGARDING THE MEANING OR EFFECT OF THIS
AGREEMENT, EXCEPT AS OTHERWISE REQUIRED BY LAW OR LEGAL PROCESS, OR UNLESS THE AGREEMENT AND
RELEASE HAS ENTERED THE PUBLIC DOMAIN DUE TO A DISCLOSURE BY ANY SOVEREIGN ENTITIES OR OFFICIALS.



          In witness hereof, I have executed this Agreement and General Release this
12th  day of February, 2009.



	 	 	 	 	 
	/s/ Kirk Walters
 


	 	 
	 	 
	Kirk Walters
	 	 	 	 
	 
	 	 	 	 
	STATE OF MASSACHUSETTS     )
	 	 	 	 
	:

	 	ss.:	 	 
	COUNTY OF SUFFOLK                 )
	 	 	 	 






          On
this 13th  day of February, 2009, before me, a Notary Public
of the State of Massachusetts, personally appeared KIRK WALTERS, to me known and known to
me to be the person described and who executed the foregoing Agreement and General Release and did
then and there acknowledge to me that s/he voluntarily executed the same.



	 	 	 	 	 
	 

	 	/s/ Brenda L . Page	 	 
	 

	 	 

Notary Public
	 	 











YOU MUST RETURN THE ENTIRE AGREEMENT AND GENERAL RELEASE

(INCLUDING THE ACKNOWLEDGMENT PAGE).





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EXHIBIT A




February 11,
2009               




Kirk Walters

c/o Sovereign Bancorp, Inc.




Dear Kirk:




     It is with great pleasure that we extend an offer setting forth the following terms for your
continued employment with Sovereign Bancorp, Inc. (and/or its related entities, defined as
“Sovereign”):



	 	 	 
	Title/Function:

	 	Chief Financial Officer & Non Core Assets, reporting directly to
the Chief Executive Officer. Notwithstanding the foregoing, during
your employment with Sovereign, Sovereign reserves the right, in its
sole discretion, to modify your title, function, responsibilities
and reporting relationships. You agree to use your best efforts,
skill and ability to perform your duties and responsibilities, and
to devote all of your business time and energy to the performance of
your duties and responsibilities hereunder.
	 
	 	 
	Work Location:

	 	Your initial work location will be at the offices of Sovereign
located in Boston, Massachusetts. You will be required, however, to
travel to other locations based on business necessity.
	 
	 	 
	Compensation:

	 	For calendar year 2009 (“2009”), your salary will be paid at the
rate of $600,000 per annum (less applicable deductions and
withholdings), payable in accordance with Sovereign’s regular
payroll practices.
	 
	 	 
	 

	 	In addition, for 2009, you will be eligible to receive a
discretionary bonus, payable in accordance with Sovereign policy with
respect to the payment of bonuses (as amended from time to time). The
amount of the discretionary bonus, if any, will be determined by
Sovereign in its sole discretion based on, among other things, your
performance and the performance of Sovereign. Your discretionary
bonus for 2009 will be in a target amount of $650,000






 









 






	 	 	 
	 

	 	(“Discretionary Target Bonus”). Notwithstanding the foregoing, all
bonus payments for 2009, if any, will be made no later than March
15, 2010. In order to receive the Discretionary Target Bonus, if
any, you must be in an “active working status” at the time of bonus
payment (except as otherwise set forth below in the “Termination
Other Than for Cause” paragraph).
	 
	 	 
	 

	 	Subsequent to 2009, if you are still employed by Sovereign and in
“active working status” at the time of bonus payments for 2010 or
subsequent years, Sovereign, in its sole discretion, may (but is not
obligated to) pay a discretionary bonus to you for 2010 or
subsequent years. The amount of any discretionary bonus, if any, may
vary from year to year. Discretionary bonuses payable after 2009, if
any, and will be payable in accordance with Sovereign policy with
respect to the payment of bonuses, as amended from time to time.
	 
	 	 
	 

	 	If Sovereign’s parent company establishes or maintains a long-term
incentive plan to which executives of Sovereign are eligible to
participate, you will be recommended for approval to participate in
such plan, if any, in accordance with the terms and conditions of
any such plan.
	 
	 	 
	 

	 	For purposes of this letter, “active working status” means that you
have not resigned (or given notice of your intention to resign) and
have not been terminated (or been given notice of your termination).
	 
	 	 
	Expenses:

	 	Sovereign will reimburse you for all reasonable business expenses
actually incurred by you in connection with the performance of your
duties hereunder, in accordance with policies established by
Sovereign from time to time and subject to receipt by Sovereign of
appropriate documentation.
	 
	 	 
	Compliance With

Policies And Procedures:

	 	

You agree to continue to be bound by and to comply fully with all
policies and procedures for employees, including but not limited to,
all terms and conditions set forth in any employee handbook,
compliance manual and any other memoranda and communications
pertaining to policies, procedures, rules and regulations, as
currently in effect and as may be amended or established from time
to time. These policies and procedures include, among other things
and without limitation, your obligations to comply with Sovereign’s
rules regarding confidential and proprietary information, trade
secrets and intellectual property. Failure to comply with all such
policies and






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	 	procedures shall be grounds for disciplinary action by Sovereign,
up to and including termination.
	 
	 	 
	Termination Other Than

for Cause:

	 	

If your employment is terminated by Sovereign other than for
cause prior to the date that Sovereign makes its regular payment of
2009 bonuses to its employees, you will receive (less applicable
deductions and withholdings): (i) any salary that has been earned
but unpaid up to the date of your termination; and (ii) a pro-rated
portion of the Discretionary Target Bonus amount of $650,000, based
on the number of full months that you worked for Sovereign in 2009,
which will be payable in accordance with Sovereign policy with
respect to the payment of bonuses. You will not receive any
additional payments other than those set forth above in this
paragraph (whether a discretionary or guaranteed bonus, any
additional salary, severance, or otherwise) whatsoever.
	 
	 	 
	 

	 	Notwithstanding the foregoing, if your employment is terminated by
Sovereign other than for cause at any time, you will receive
continued coverage under Sovereign’s group health insurance plan
(without charging you premium co-payments) for three (3) years
following the last day of your employment. Notwithstanding the
foregoing, nothing in this paragraph is intended to alter the at
will status of your employment or extend the term of this agreement.
	 
	 	 
	Resignation/Termination

for Cause:

	 	

In the event that you resign or your employment is terminated by
Sovereign for cause, you will not be entitled to any bonus
(discretionary, guaranteed or otherwise), any severance or any
termination payments referred to in the above paragraph (other than
any Discretionary Target Bonus already paid to you as of the date of
your resignation or termination), except that you will be entitled
to salary earned prior to your resignation or termination.
	 
	 	 
	 

	 	Notwithstanding the foregoing, in the event that you resign,
Sovereign will provide you with continued coverage under Sovereign’s
group health insurance plan (without charging you premium
co-payments) for three (3) years following the last day of your
employment. If you are terminated for cause, however, you will not
receive such continued coverage. Notwithstanding the foregoing,
nothing in this paragraph is intended to alter the at will status of
your employment or extend the term of this agreement.
	 
	 	 
	 

	 	For purposes hereof, “cause” shall mean that: (i) you committed an
act constituting a misdemeanor involving moral turpitude, fraud or
misrepresentation or a felony under the laws of the United States or
any state or political subdivision thereof; (ii) you violated laws,






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	 	rules or regulations applicable to banks, investment banks,
broker-dealers, investment advisors or the banking, commodities,
futures or securities industries generally; (iii) you committed an
act constituting a breach of fiduciary duty, gross negligence or
willful misconduct; (iv) you engaged in conduct that violated
Sovereign’s internal policies or procedures and which is detrimental
to the business, reputation, character or standing of Sovereign or
any of its related entities; (v) you committed an act of fraud,
dishonesty or misrepresentation that is detrimental to the business,
reputation, character or standing of Sovereign or any of its related
entities; (vi) you engaged in a conflict of interest or
self-dealing; or (vii) after notice by Sovereign and a reasonable
opportunity to cure, you materially breached your obligations as set
forth in this agreement or you failed to perform your duties as an
employee of Sovereign.
	 
	 	 
	Confidential Information:

	 	In addition to any other applicable policies regarding Sovereign’s
confidential or proprietary information, you agree that during and
at any time after your employment with Sovereign, you will keep in
confidence and will not, except as specifically authorized in
writing by Sovereign or as otherwise required by law, disclose to
any third party or use for the benefit of any third party or
yourself any confidential or proprietary information about Sovereign
(or its related entities) which you acquired, developed or created
by reason of your employment, except for information that is or
becomes public other than through your breach of this paragraph.
	 
	 	 
	 

	 	You agree not to disclose the terms of this agreement to anyone
except your immediate family and your tax advisors or legal counsel,
except as otherwise required by law. You further agree to instruct
your immediate family and any tax advisors or legal counsel not to
disclose this agreement, except as otherwise required by law.
	 
	 	 
	 

	 	You further agree to deliver promptly to Sovereign upon the
termination of your employment for any reason or at any other time
upon the request of Sovereign all documents, materials and computer
media in any form (and all copies thereof) and all other property of
Sovereign (or its related entities).
	 
	 	 
	Notice Period:

	 	In the event that you resign from Sovereign, you agree to provide
Sovereign with 30 days notice of your resignation. Sovereign reserves
the right, in its sole discretion, to designate this period as either
a paid working or non-working notice period, or to reduce or waive
the notice period, in whole or in part.






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	Restrictive Covenants:

	 	In consideration of your continued employment, you agree that
beginning on the date that you execute this agreement and continuing
through 12 months after the last date of your employment, you will
not directly or indirectly solicit or induce, or cause others to
solicit or induce, any person who is employed or engaged by
Sovereign (or its related entities) (or any person who was employed
or engaged by Sovereign or its related entities within the last 12
months of your employment) to terminate his or her employment or
engagement with Sovereign (or its related entities) or to accept
employment with anyone or any entity other than Sovereign (or its
related entities). This restrictive covenant will apply in full
force and effect even in the event that you resign from or are
terminated, with or without cause as defined above, by Sovereign.
	 
	 	 
	Benefits:

	 	You will continue to be eligible to participate in Sovereign’s
benefits plans (e.g., health, dental, life and disability) and like
benefits (e.g., parking, car allowance, club dues) in which you are
currently participating and/or in which other senior management of
Sovereign generally are eligible to participate from time to time,
subject to their exclusions and limitations, as such plans and
benefits may be amended, terminated or replaced by Sovereign from
time to time in its sole discretion (provided that Sovereign will
provide prior notice where required by the applicable plan
documents).
	 
	 	 
	Temporary Housing:

	 	Sovereign will pay for the cost of temporary housing in the Greater
Boston Metropolitan Area for you in a two-bedroom furnished apartment
at Devonshire (or comparable arrangement) up to the later of (i)
December 31, 2010 or (ii) the date that you relocate your family to a
residence in Boston, provided that you remain an active employee of
Sovereign. If you choose to relocate your family permanently to
Boston, you will be eligible for relocation assistance in accordance
with Sovereign’s policies (except that any condition in such policies
that you must relocate within 12 months of hire will not apply).
Sovereign will provide you with “tax assistance” (within the meaning
of Sovereign’s Executive Relocation Policy) with respect to relocation
benefits that constitute taxable income and are eligible for such “tax
assistance” as provided for in its relocation policies for so long as
Sovereign is providing you such temporary housing. In addition,
regardless of whether you relocate, Sovereign will provide to you a
one-time “Miscellaneous Expense Allowance” in accordance with
Sovereign’s relocation policies (except that any condition in such
policies that you must relocate within 12 months of hire will not
apply), which will be payable prior to December 31, 2009.
Notwithstanding the foregoing, nothing in this paragraph is






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	 	intended to alter the at will status of your employment or extend
the term of this agreement.
	 
	 	 
	No Mitigation:

	 	You shall not be required to seek other employment or to reduce
any benefit payable to you hereunder, and no benefit shall be
reduced by any compensation received by you from other employment.
	 
	 	 
	Modification:

	 	This agreement contains the entire understanding of the parties
regarding the subject matter hereof and no terms may be modified
except by a document signed by the parties and referring explicitly
hereto. You acknowledge that you have not relied on any oral or
written representations or understandings not explicitly contained
herein in executing this agreement.
	 
	 	 
	Governing Law:

	 	This agreement will be governed by and construed in accordance
with the laws of the State of Massachusetts (without regard to its
conflicts of law principles). If any portion of this agreement is
found to be unenforceable but such portion would be enforceable if
some part thereof were deleted or modified, then such portion will
apply with such deletion or modification as is necessary to make it
enforceable to the fullest extent permitted by law. If any such
portion cannot be modified to be enforceable, such portion will be
deemed severed from this agreement and will not affect the validity
or enforceability of the remainder of this agreement.






     Nothing in this agreement is intended to create a fixed term of employment at Sovereign. Your
employment at Sovereign is on an at will basis, meaning that Sovereign will be free to terminate
your employment at any time, with or without cause, and that you will be free to resign from your
employment with Sovereign at any time.



     If you accept this offer, please sign and date this letter in the space provided below and,
by no later than March 10, 2009, return a copy to me at Sovereign Bancorp, Inc., 75 State Street,
Boston, Massachusetts 02109.



Sincerely yours,




Sovereign Bancorp, Inc.



Thomas J. McAuliffe

Executive Vice President and Managing Director of Human Resources




	 	 	 	 	 	 	 	 	 	 	 
	Accepted:

	 	   /s/ Kirk Walters
 

 Kirk Walters
	 	 
	 	Date:
	 	2/12/09
 

	 	 







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