Document:

EX-10.22

 

Exhibit 10.22

AGREEMENT AND RELEASE

The Federal Home Loan Bank of Pittsburgh (“Bank”) and William G. Batz (“Employee”) have entered
into this AGREEMENT AND RELEASE (“Agreement”) in consideration of the payments to Employee as
specified in this Agreement, and in consideration of the promises and representations below,
intending to be legally bound, as follows:

	1.	 	Due to the elimination of Employee’s current position as Chief Operating Officer, Employee’s
employment with the Bank will terminate on May 31, 2008.
	 
	2.	 	In return for Employee’s agreeing to the terms of this Agreement, the Bank agrees to pay
Employee the amounts, make the medical insurance contributions and provide outplacement as set
forth below:

	 	a.	 	The Bank shall pay Employee the amount equivalent to twelve (12) months of
Employee’s current base salary. This amount shall be paid in 24 semi-monthly
installments with the first payment due on June 13, 2008 and the final installment
payment due on May 29, 2009. The gross amount of each single installment payment shall
be seventeen thousand eight hundred sixty-three dollars and forty-two cents
($17,863.42). The total salary continuation payments shall equal and not exceed four
hundred twenty-eight thousand seven hundred twenty-two dollars and eight cents
($428,722.08).
	 
	 	b.	 	Payment Under the Long-Term Incentive (“LTI”) Plan. The gross amount of
$34,751.66 representing the previously retained portion (20%) of the 2007 LTI award
plus interest at the applicable annual notional interest rate of 4.6% from March 1,
2008 to June 13, 2008. This amount shall be paid to Employee on June 13, 2008.
	 
	 	c.	 	Any 2008 accrued and unused vacation days as of May 31, 2008 (net of repayment
of the $1,000 outstanding travel advance), shall be paid to Employee by June 13, 2008.
	 
	 	d.	 	The gross amount of $237,000. This amount shall be paid to Employee in a lump
sum on June 30, 2008.
	 
	 	e.	 	During the period from March 31, 2008 through May 31, 2008, Employee shall work
on such projects and assignments as shall be provided for him by the Bank President and
perform such other duties as shall be required.
	 
	 	f.	 	Bank Contributions to Medical Insurance Benefits Continuation Coverage. During
the period from June 1, 2008 through May 31, 2009, the Bank will pay the employer’s
portion of the premiums for Employee’s continued participation in the applicable Bank
group medical insurance program consistent with his elections, to the same extent that
the Bank pays the employer’s portion for its active employees. The Employee shall
contribute the employee’s portion of the premiums for participation in the Bank’s
applicable medical insurance program and such amounts shall be deducted from the
semi-monthly salary continuation payments referenced above.
	 
	 	g.	 	During the period from May 31, 2008 through May 31, 2009, the Bank will provide
Employee outplacement assistance services with a firm identified by the Employee and
agreed to by the Bank in an amount not to exceed Twenty

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	 	 	 	Thousand Dollars ($20,000), if Employee desires to avail himself of such services.
No outplacement assistance services will be provided after May 31, 2009.

Employee acknowledges and agrees that the payment amounts set forth above are gross amounts subject
to all tax withholdings required by federal, state and/or local laws (to the extent applicable).
Pursuant to the final Treasury regulations issued on April 10, 2007, it is intended that the
payments set forth in this Agreement to Employee either: (i) are exempt from Section 409A of the
Internal Revenue Code of 1986, as amended (“Code”) under either the separation pay exemption
pursuant to Treasury regulation §1.409A-1(b)(9)(iii) or as a short-term deferral pursuant to
Treasury regulation §1.409A-1(b)(4), and for purposes of each such exemption, each installment paid
to the Employee shall be considered a separate payment or (ii) comply with Section 409A of the
Code. The Bank agrees not to report the payments to Employee which are exempt from or comply with
Section 409A of the Code on the Employee’s Form W-2 as being subject to the imposition of penalties
under Section 409A of the Code (“409A Penalties”). In the event the terms of this Agreement would
subject the Employee to the 409A Penalties, the party making the determination shall immediately
notify the other party in writing (referred to as “Written Notice”) that one or more payments
provided by the Agreement do not satisfy Section 409A of the Code. The Bank and Employee shall
cooperate diligently to, within 10 days of such Written Notice, amend the payment date(s) set forth
in the Agreement which would subject Employee to the 409A penalties to the first payment date which
would not subject the payment(s) to the 409A Penalties; provided that, there shall be no amendment
of the payment dates or agreement to amend the payment date(s) unless and until both parties: (i)
determine that such amendment of the payment date(s) is permissible under Section 409A of the Code,
the applicable Treasury regulations and Treasury guidance and (ii) execute a written amendment to
the Agreement which amends the payment date(s).

	3.	 	As set forth in the Variable Incentive Plan (“VIP”), Employee shall be eligible to receive
payment of a pro-rated 2008 VIP award under the plan (for the period from January 1, 2008
through May 31, 2008 (the employment termination date) in the event that the Board determines
to declare 2008 VIP awards following the completion of the 2008 VIP performance period on
December 31, 2008. Under the VIP, such pro-rated award amount shall not be subject to the 20%
retention. Any pro-rated VIP award paid out under the VIP shall be paid to Employee when the
Bank makes payment of the 2008 VIP awards to active employees which is expected to be on or
before March 15, 2009. If the Board declares 2008 VIP awards for any VIP participant, then,
Employee shall receive a pro-rated 2008 VIP award based on the actual achievement level
attained for the Bank performance goals and a pro-rated target award level for Employee’s
individual shared goal. In the event that the Board does not declare 2008 VIP awards for any
VIP participant, then, Employee shall not receive a pro-rated 2008 VIP award. Any pro-rated
VIP award amount shall not be included in the calculation of Employee’s retirement benefit
under the Supplemental Executive Retirement Plan (“SERP”).
	 
	4.	 	The parties recognize that the payments and benefits under this Agreement exceed any payments
to which Employee might otherwise be entitled under existing Bank policies in the absence of
execution of this Agreement. This Agreement shall not affect Employee’s rights to any
qualified or non-qualified retirement or thrift plan benefits vested through the date of
employment termination, May 31, 2008. The terms of such qualified and non-qualified
retirement and thrift plans and the elections made thereunder shall govern payments under
those plans. Except as set forth herein, no other payments or benefits
shall be provided by the Bank to Employee following Employee’s termination of employment.

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	5.	 	Employee hereby confirms that as of his last day of employment he has returned to the Bank
all credit cards, keys, computers, computer software, files, manuals and any other property of
the Bank.
	 
	6.	 	In return for the payments described above, Employee, on behalf of Employee, Employee’s
heirs, representatives, estates, successors and assigns, does hereby irrevocably and
unconditionally remise, release and forever discharge the Bank, its predecessors, benefits
plans, and any successors thereto, and their past, present and future officers, directors,
trustees, administrators, agents, attorneys, insurance carriers, consultants or employees, as
well as the heirs, successors and assigns of any such persons or such entities (severally and
collectively called “Releasees”), jointly and individually, from any and all claims, known and
unknown, that Employee has or may have against any of the Releasees for any acts, practices or
events up to and including the effective date of this Agreement and the continuing effects
thereof, it being the intention of Employee to effect a general release of all such claims.
This release includes any and all claims under any possible legal, equitable, tort, contract,
common law or statutory theory, including, but not limited to, any claims under Title VII of
the Civil Rights Act of 1964, as amended, the Pennsylvania Human Relations Act, the federal
Age Discrimination in Employment Act of 1967, as amended, the Older Workers Benefit Protection
Act, the federal Civil Rights Act of 1991, the Rehabilitation Act of 1973, the Americans With
Disabilities Act, the City of Pittsburgh Human Relations Ordinance, and other applicable
federal, state, and local statutes, ordinances, executive orders, regulations and other laws
prohibiting discrimination in employment or benefits, the Employee Retirement Income Security
Act of 1974, as amended, and state or local law claims of any kind whatsoever arising out of
or in any way related to Employee’s employment with the Bank or separation from employment
with the Bank.
	 
	7.	 	Employee also specifically releases all Releasees from any and all claims for the fees, costs
and expenses of any and all attorneys who have at any time or are now representing Employee in
connection with this Agreement or in connection with any matter released in this Agreement.
	 
	8.	 	Notwithstanding any other language in this Agreement, the parties understand that this
Agreement does not prohibit Employee from filing an administrative charge of alleged
employment discrimination under Title VII of the Civil Rights Act of 1964, the Age
Discrimination in Employment Act of 1967, the Americans With Disabilities Act of 1990 or the
Equal Pay Act of 1963. Employee, however, waives his right to monetary or other recovery
should any federal, state or local administrative agency pursue any claims on his behalf
arising out of or relating to his employment with and/or separation from employment with the
Bank or any of the other Releasees. This means that by signing this Agreement, Employee will
have waived any right he had to obtain a recovery if an administrative agency pursues a claim
against the Bank or any of the Releasees based on any actions taken by any of the Releasees up
to the date of the signing of this Agreement, and that Employee will have released the
Releasees of any and all claims of any nature arising up to the date of the signing of this
Agreement.
	 
	9.	 	It is expressly understood and agreed that by entering into this Agreement, the Bank in no
way admits that it has treated Employee unlawfully or wrongfully in any way. To the contrary,
the Bank expressly denies that it has violated any of Employee’s rights or that it

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	 	 	harmed Employee in any way. Neither this Agreement nor the implementation thereof shall be
construed to be, or shall be admissible in any proceeding as, evidence of an admission by
the Bank of any violation of or failure to comply with any applicable federal, state, or
local law, ordinance, agreement, rule, regulation or order; except that this sentence does
not preclude introduction of this Agreement to establish that Employee’s claims were
released and discharged according to the terms of this Agreement.
	 
	10.	 	Employee agrees that, except as required by law, the terms and conditions of this Agreement
have been and will be kept completely confidential and have not been and will not be
discussed, disclosed, or revealed, directly or indirectly, to any person, corporation, or
other entity, other than to Employee’s spouse, attorney, financial advisor, accountant for use
on tax matters or to government taxing agencies or taxing officials. Each party agrees not to
make any comment or take any action (including, without limitation, comments to Bank
customers, the media or professional colleagues) which disparages, defames, or places in a
negative public light the other party.
	 
	11.	 	Employee acknowledges that Employee has been given the opportunity to consider this Agreement
for at least 45 calendar days, which is a reasonable period of time, and that Employee has
been advised to consult with an attorney about this Agreement prior to executing it. Employee
further acknowledges that Employee has had a full and fair opportunity to consult with an
attorney if Employee desired to do so, that Employee has carefully read and fully understands
all of the provisions of this Agreement, and that Employee is voluntarily executing and
entering into it, intending to be legally bound hereby. If Employee executes this Agreement
in less than 45 days, he acknowledges that he has thereby waived his right to the full 45-day
period.
	 
	12.	 	For a period of seven calendar days following the execution of this Agreement, Employee may
revoke it by delivery of a written notice of revocation to the office of the Bank’s General
Counsel, Dana A. Yealy, 601 Grant Street, 16th Floor, Pittsburgh, PA 15219 no later
than 4:30 p.m. on the seventh day following the date Employee signs this Agreement. This
Agreement shall not become effective or enforceable before the seven-day revocation period has
expired. A revocation would automatically terminate this Agreement.
	 
	13.	 	The parties hereto further understand and agree that the terms and conditions of this
Agreement constitute the full and complete understandings and arrangements of the parties and
that there are no agreements, covenants, promises or arrangements other than those set forth
herein. The Bank agrees not to contest Employee’s filing for unemployment compensation.
	 
	14.	 	This Agreement and Release shall be governed by and construed in accordance with the laws of
the Commonwealth of Pennsylvania.
	 
	15.	 	If any of the provisions of this Agreement are declared or determined by any court to be
invalid or unenforceable for any reason, the remaining provisions and portions of this
Agreement — at the Bank’s sole option — shall be unaffected thereby and shall remain in full
force to the fullest extent permitted by law.

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	16.	 	This Agreement is a legal document in which Employee releases all claims against the Bank and
the other Releasees described in the Agreement, as of the date Employee signs
it. By law, the Bank is required to notify Employee of the information contained on Exhibit
A attached hereto.
	 
	17.	 	This Agreement is presented for consideration on March 31, 2008.

IN WITNESS WHEREOF, the aforesaid parties, having read this Agreement And Release and intending to
be legally bound hereby, have read, signed, sealed and delivered it, voluntarily, without coercion
and with knowledge of the nature and consequences thereof.

PLEASE READ CAREFULLY, THIS AGREEMENT CONTAINS A RELEASE OF CLAIMS.

	 	 	 	 	 	 	 
	WILLIAM G. BATZ	 	 	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	/s/ William G. Batz	 	Witness:	 	/s/ Julie F. Spiker
	 	 	 	 	 
	[Signature]	 	 	 	 
	 
	 	 	 	 	 	 
	Date:

	 	May 1, 2008
	 	Date:
	 	May 1, 2008
	 

	 	 
	 	 	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	FEDERAL HOME LOAN BANK OF PITTSBURGH	 	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	By:

	 	/s/ John R. Price	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	Title:

	 	President and CEO	 	 	 	 
	 

	 	 	 	 	 
	 
	 	 	 	 	 	 
	Date:

	 	May 1, 2008	 	 	 	 
	 

	 	 
	 	 	 

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Exhibit A

	I.	 	The following employees, by age and job title, are in the limited group of full-time
employees of the Bank’s Management Committee whose employment will be involuntarily terminated
on May 31, 2008 due to job elimination based on ongoing business needs of the Bank and skills
and abilities of the employees:

	 	 	 	 	 	 	 
	Age as of

March 31, 2008

	 	Job Title
	 	No.

	 

	 	 
	 	 	 	 
	60

	 	Chief Operating Officer
	 	 	1	 

	II.	 	The following is the distribution by age and job title of the
full-time employees of the Bank’s Management Committee who are not
included in the limited group of involuntary terminations on May
31, 2008 due to job elimination based on ongoing business needs of
the Bank and skills and abilities of the employees:

	 	 	 	 	 	 	 
	Age as of

March 31, 2008

	 	Job Title
	 	No.

	 

	 	 
	 	 	 	 
	69

	 	President & CEO
	 	 	1	 
	59

	 	Managing Dir. Cap. Markets
	 	 	1	 
	44

	 	Chief Information Officer
	 	 	1	 
	50

	 	Chief Risk Officer
	 	 	1	 
	45

	 	Group Director MMA
	 	 	1	 
	43

	 	Chief Financial Officer
	 	 	1	 
	49

	 	General Counsel & Corp. Secretary
	 	 	1	 

6EX-10.1

 

EXHIBIT 10.1

Form of 409A Amendment to the

Director Fee Continuation Agreements Between

First Federal Savings Bank and

Joseph U. Frye, John J. LaCarte and Jack M. McGinley

     On April 28, 2008, First Federal Savings Bank and Joseph U. Frye, John J. LaCarte and Jack M.
McGinley (the “executives”) entered into 409A Amendments, effective January 1, 2005, to the
Director Fee Continuation Agreements, dated June 30, 1999, between First Federal Savings Bank and
each of the executives. The amendment to each executive’s Director Fee Continuation Agreement is
identical to the attached Form of 409A Amendment, except for the addition of the executive’s name.

 

 

409A Amendment

to the

First Federal Savings Bank

Director Fee Continuation Agreement for

 

     First Federal Savings Bank (“Bank”) and                      (“Director”) originally entered into
the First Federal Savings Bank Director Fee Continuation Agreement (“Agreement”) on June 30, 1999.
Pursuant to Subparagraph XI (C) of the Agreement, the Bank and the Director hereby adopt this 409A
Amendment, effective January 1, 2005.

RECITALS

     This Amendment is intended to bring the Agreement into compliance with the requirements of
Internal Revenue Code Section 409A. Accordingly, the intent of the parties hereto is that the
Agreement shall be operated and interpreted consistent with the requirements of Section 409A.
Therefore, the following changes shall be made:

	1.	 	The following provision regarding “Separation from Service” distributions shall be added as a
new subparagraph (C) under Section III, as follows:

Separation from Service:

Notwithstanding anything to the contrary in this Agreement, to the extent that any benefit
under this Agreement is payable upon a “Termination of Employment,” “Termination of
Service,” or other event involving the Director’s cessation of services, such payment(s)
shall not be made unless such event constitutes a “Separation from Service” as defined in
Treasury Regulations Section 1.409A-1(h).

	2.	 	Section IV, “Retirement Benefit and Post-Retirement Death Benefit”, shall be amended to
delete the first sentence in its entirety and to replace it with the following sentence:

Upon the Director’s retirement, the Bank, commencing with the first day of the month
following the Benefit Payment Date [Subparagraph III (A)], shall pay the Director an annual
benefit equal to one hundred dollars ($100.00) for each full year the Director served the
Bank from the date of first service to the date of retirement (including any partial year
that the Director has served in the year of retirement), payable in equal annual
installments for a period of ten (10) years, provided that if less than ten (10) such annual
payments have been made prior to the death of the Director, the Bank shall make the total
amount of said payment due in a lump sum to such individual or individuals as the Director
may have designated in writing and filed with the Bank.

	3.	 	Section V, “Death Benefit Prior to Retirement”, shall be amended to delete the words “either,
at the discretion of the Bank” and “or equal annual installments for a period of ten (10)
years” from the first sentence; and to delete the word “monthly” from the third sentence.

	4.	 	Section VIII, “Other Termination of Service”, shall be amended to insert the words
“commencing thirty (30) days following said termination” at the end of the second sentence in
the first paragraph; to delete the words “the remaining installments, or” and “at the
discretion of the Bank” from the first sentence of the second paragraph; and to delete the
word “monthly” from the third sentence of the second paragraph.

	5.	 	Section IX, “Change of Control”, shall be deleted in its entirety and replaced with the
following Section IX:

 

 

CHANGE IN CONTROL

“Change in Control” shall mean a change in ownership or control of the Bank as defined in
Treasury Regulation §1.409A-3(i)(5) or any subsequently applicable Treasury Regulation.
Upon a Change in Control, the Director shall receive the accrued balance of the Director’s
accrued liability reserve account in a lump sum upon attaining Normal Retirement Age
[Subparagraph III (B)]. Provided, however, that anything hereinabove to the contrary
notwithstanding, no death benefit shall be payable hereunder if the Director dies on or
before the 30th day of June, 2001.

	6.	 	A new Subparagraph XI (K) shall be added as follows:

Restriction on Timing of Distribution:

Notwithstanding any provision of this Agreement to the contrary, distributions under this
Agreement may not commence earlier than six (6) months after the date of a Separation from
Service (as described under the “Separation from Service” provision herein) if, pursuant to
Internal Revenue Code Section 409A, the participant hereto is considered a “specified
employee” (under Internal Revenue Code Section 416(i)) of the Bank if any stock of the Bank
is publicly traded on an established securities market or otherwise. In the event a
distribution is delayed pursuant to this Section, the originally scheduled distribution
shall be delayed for six (6) months, and shall commence instead on the first day of the
seventh month following Separation from Service. If payments are scheduled to be made in
installments, the first six (6) months of installment payments shall be delayed, aggregated,
and paid instead on the first day of the seventh month, after which all installment payments
shall be made on their regular schedule. If payment is scheduled to be made in a lump sum,
the lump sum payment shall be delayed for six (6) months and instead be made on the first
day of the seventh month.

	7.	 	A new Subparagraph XI (L) shall be added as follows:

Certain Accelerated Payments:

The Bank may make any accelerated distribution permissible under Treasury Regulation
1.409A-3(j)(4) to the Director of deferred amounts, provided that such distribution(s) meets
the requirements of Section 1.409A-3(j)(4).

	8.	 	A new Subparagraph XI (M) shall be added as follows:

Subsequent Changes to Time and Form of Payment:

The Bank may permit a subsequent change to the time and form of benefit distributions. Any
such change shall be considered made only when it becomes irrevocable under the terms of the
Agreement. Any change will be considered irrevocable not later than thirty (30) days
following acceptance of the change by the Plan Administrator, subject to the following
rules:

	 	(1)	 	the subsequent deferral election may not take effect until at least
twelve (12) months after the date on which the election is made;
	 
	 	(2)	 	the payment (except in the case of death, disability, or
unforeseeable emergency) upon which the subsequent deferral election is made is
deferred for a period of not less than five (5) years from the date such payment
would otherwise have been paid; and
	 
	 	(3)	 	in the case of a payment made at a specified time, the election must
be made not less than twelve (12) months before the date the payment is scheduled
to be paid.

 

 

Therefore, the foregoing changes are agreed to.

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	For the Bank	 	 	 	[Director]	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Date

	 	 
	 	 
	 	Date

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