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brooklineexhibit41

                                                                                                                         DESCRIPTION OF EQUITY SECURITIES REGISTERED                           UNDER SECTION 12 OF THE EXCHANGE ACT    Brookline Bancorp, Inc. (the “Company”) has one class of securities registered under Section 12 of the Securities   Exchange Act of 1934, as amended: common stock, par value $1.00 per share (the “Common Stock”).  The   Company’s Common Stock is traded on the Nasdaq Global Select Marketsm under the symbol “BRKL.”   The following is a description of the material terms and provisions of the Company’s Common Stock. It may not  contain all information that is important to you. You can access complete information by referring to the Company’s  certificate of incorporation and bylaws and the Delaware General Corporation Law. The certificate of incorporation  and bylaws are attached as exhibits to the Annual Report on Form 10-K to which this description is an exhibit.     General     Under the certificate of incorporation, the Company has authority, without further shareholder action, to issue up to   200,000,000 shares of Common Stock. The Company may amend its certificate of incorporation from time to time   to increase the number of authorized shares of Common Stock with shareholder approval.     The Company may issue Common Stock from time to time. The Company’s Board of Directors must approve the  amount of capital stock the Company sells and the price for which it is sold. Holders of Common Stock do not have   any preferential rights or preemptive rights to buy or subscribe for capital stock or other securities that the Company   may issue. The Company’s Common Stock does not have any redemption rights, sinking fund provisions or any   conversion rights.     Dividends     The Company may pay dividends on its Common Stock if, after giving effect to the distribution, it would be able to   pay its indebtedness as the indebtedness comes due in the usual course of business and its total assets exceed the   sum of its liabilities and the amount needed, if the Company were to be dissolved at the time of the distribution, to   satisfy the preferential rights upon dissolution of any holders of capital stock who have preference in the event of   dissolution. The holders of Common Stock are entitled to receive and share equally in dividends as may be declared   by the Company’s Board of Directors out of funds legally available therefor. If the Company issues shares of  preferred stock, the holders thereof may have a priority over the holders of the Common Stock with respect to  dividends.   Liquidation    In the event of any liquidation, dissolution or winding up of the Company, and subject to the preferential rights of   any other class or series of stock, holders of shares of the Common Stock are entitled to receive all assets of the   Company available for distribution, after payment or provision for payment of all debts and liabilities of the   Company, including deposit accounts and accrued interest thereon, and after distribution of the balance in the   liquidation account to eligible account holders.     Voting Rights     Subject to the provisions of the certificate of incorporation, each holder of Common Stock is entitled to one vote per   share and has no right to cumulate votes in the election of directors. Holders of the Company’s Common Stock elect   the Company’s Board of Directors and act on all other matters as are required to be presented to them under   Delaware law or as are otherwise presented to them by the Company’s Board of Directors.     Under the certificate of incorporation, any person who beneficially owns more than 10% of the then-outstanding   shares of the Company’s Common Stock will not be entitled or permitted to vote any shares of Common Stock held   in excess of the 10% limit.  

 

                                                                                                      All matters to be voted on by stockholders, other than a contested election of directors, must be approved by a   majority of the votes cast at a meeting of stockholders duly called and at which a quorum is present, subject to any   voting rights granted to holders of any then outstanding preferred stock. In contested elections of directors, which   generally will include any situation in which the Company receives a notice that a stockholder has nominated a   person for election to the Company’s Board of Directors at a meeting of the stockholders of the Company that is not  withdrawn on or before the tenth day before the Company first mails its notice for such meeting to its stockholders,  a plurality voting standard will apply.a2011rsaplan

                                                                                      BROOKLINE BANCORP, INC.                                                                                      2011 RESTRICTED STOCK PLAN                                                                                           ARTICLE 1 – GENERAL                                                                Section 1.1    Purpose, Effective Date and Term.  The purpose of the Brookline Bancorp, Inc. 2011   Restricted Stock Plan (the “Plan”) is to promote the long-term financial success of Brookline Bancorp, Inc. (the  “Company”), and its Subsidiaries, including Brookline Bank (the “Bank”), by providing a means to attract, retain  and reward individuals who contribute to such success and to further align their interests with those of the  Company’s stockholders.  The “Effective Date” of the Plan shall be the date the Plan is implemented by the Board  subsequent to the satisfaction of the applicable shareholder approval requirements.  The Plan shall remain in effect  as long as any Awards are outstanding; provided, however, that no Awards may be granted under the Plan after the  ten-year anniversary of the Effective Date.           Section 1.2    Administration.  The Plan shall be administered by the Compensation Committee of the   Company’s Board of Directors (the “Committee”), in accordance with Section 5.1.           Section 1.3    Participation.  Each Employee or Director of the Company or any Subsidiary of the   Company who is granted an Award in accordance with the terms of the Plan shall be a “Participant” in the Plan.    Awards shall be limited to Employees and Directors of the Company or any Subsidiary.           Section 1.4    Definitions.  Capitalized terms used in this Plan are defined in Article 8 and elsewhere in   this Plan.                                         ARTICLE 2 - AWARDS           Section 2.1    General.  Each Award under the Plan shall be subject to the terms and conditions of the   Plan and such additional terms, conditions, limitations and restrictions as the Committee shall provide with respect   to such Award and as evidenced in the Award Agreement.  Subject to the provisions of Section 2.6, an Award may   be granted as an alternative to or replacement of an existing Award under the Plan or any other plan of the Company   or any Subsidiary or as the form of payment for grants or rights earned or due under any other compensation plan or   arrangement of the Company or its Subsidiaries, including without limitation the plan of any entity acquired by the   Company or any Subsidiary.             Section 2.2    Restricted Stock.               (a)    Grant of Restricted Stock.  Restricted Stock means a grant of shares of Stock under this Section or  under Section 2.3 with respect to shares intended to be performance-based compensation, for no consideration or  such minimum consideration as may be required by applicable law, either alone or in addition to other Awards  granted under the Plan, subject to a vesting schedule or the satisfaction of market conditions or performance  conditions.  Each Restricted Stock Award shall be evidenced by an Award Agreement that shall: (i) specify the   number of shares of Stock covered by the Restricted Stock Award; and (ii) specify the date of grant of the   Restricted Stock Award; (iii) specify the vesting period; and (iv) contain such other terms and conditions not   inconsistent with the Plan, including the effect of termination of a Participant’s employment or Service with the   Company, as the Committee may, in its discretion, prescribe. All Restricted Stock Awards (other than those   subject to performance-based vesting conditions under Section 2.3 hereof) shall be in the form of issued and   outstanding shares of Stock that shall be either: (x) registered in the name of the Participant and held by the   Company, together with a stock power executed by the Participant in favor of the Company, pending the vesting  or forfeiture of the Restricted Stock; or (y) registered in the name of, and delivered to, the Participant. In any  event, the certificates evidencing the Restricted Stock Award shall at all times prior to the applicable vesting date  bear the following legend:                                                      A-1 

 

        The Stock evidenced hereby is subject to the terms of an Award Agreement with Brookline          Bancorp, Inc. dated [Date], made pursuant to the terms of the Brookline Bancorp, Inc. 2011          Restricted Stock Plan, copies of which are on file at the executive offices of Brookline Bancorp,          Inc., and may not be sold, encumbered, hypothecated or otherwise transferred except in          accordance with the terms of such Plan and Award Agreement,            or such other restrictive legend as the Committee, in its discretion, may specify.  Performance-based Restricted  Stock Awards may or may not be issued and outstanding, in the discretion of the Committee.  Notwithstanding the  foregoing, the Company may in its sole discretion issue Restricted Stock in any other approved format (e.g.,   electronically) in order to facilitate the paperless transfer of such Awards.  In the event Restricted Stock is not issued   in certificate form, the Company and the transfer agent shall maintain appropriate bookkeeping entries that evidence   Participants’ ownership of such Awards.  Restricted Stock that is not issued in certificate form shall be subject to the   same terms and conditions of the Plan as certificated shares, including the restrictions on transferability and the   provision of a stock power executed by the Participant in favor of the Company, until the satisfaction of the   conditions to which the Restricted Stock Award is subject.             (b)     Terms and Conditions. Each Restricted Stock Award shall be subject to the following terms   and conditions:                     (i)    Dividends.   Unless the Committee determines otherwise with respect to any Restricted          Stock Award and specifies such determination in the relevant Award Agreement, any cash dividends or          distributions declared with respect to shares of Stock subject to the Restricted Stock Award shall be          retained by the Committee and shall be held until the Stock subject to the Restricted Stock Award vests          in the Participant.  Upon the vesting of the Restricted Stock Award, the Committee shall cause the          dividend (and any earnings thereon) attributable to such Restricted Stock Award to be distributed to the          Participant no later than two and one-half months following the date on which the Restricted Stock          Award vests.  Alternatively, but only if determined by the Committee at the time of Award and set forth          in the Award Agreement, cash dividends or distributions declared on the Restricted Stock shall be          distributed to the Participant who has been granted the Restricted Stock at the same time as such          dividends or distributions are distributed to other stockholders without regard to whether the Stock is          vested.  Any stock dividends declared on shares of Stock subject to a Restricted Stock Award, shall be          subject to the same restrictions and shall vest at the same time as the shares of Restricted Stock from          which said dividends were derived.                    (ii)    Voting Rights. Unless the Committee determines otherwise with respect to any          Restricted Stock Award and specifies such determination in the relevant Award Agreement, voting rights          appurtenant to the shares of Restricted Stock shall be exercised by the Participant in his or her discretion.                     (iii)  Tender Offers and Merger Elections.  Each Participant to whom a Restricted Stock          Award is granted shall have the right to respond, or to direct the response, with respect to the related shares          of Restricted Stock, to any  tender offer, exchange offer, cash/stock merger consideration election or other          offer made to, or elections made by, the holders of shares of Stock. Such a direction for any such shares of          Restricted Stock shall be given by proxy or ballot (if the Participant is the beneficial owner of the shares of          Restricted Stock for voting purposes) or by completing and filing, with the inspector of elections, the          trustee or such other person who shall be independent of the Company as the Committee shall designate in          the direction (if the Participant is not such a beneficial owner), a written direction in the form and manner          prescribed by the Committee.  If no such direction is given, then the shares of Restricted Stock shall not be          tendered.             Section 2.3    Performance-Based Compensation. The vesting of any Restricted Stock Award under   the Plan that is intended to be “performance-based compensation” within the meaning of Code Section 162(m) shall  be conditioned on the achievement of one or more objective performance measures, to the extent required by Code  Section 162(m), as may be determined by the Committee.  The grant of any Award and the establishment of  performance measures that are intended to be performance-based compensation shall be made during the period  required under Code Section 162(m) and shall comply with all applicable requirements of Code Section 162(m).                                                    A-2 

 

        (a)    Performance Measures.  Such performance measures may be based on any one or more of the  following:                   (i)     basic earnings per share;                   (ii)   basic cash earnings per share;                   (iii)  diluted earnings per share;                   (iv)   core earnings per share;                   (v)    diluted cash earnings per share;                   (vi)   net income or net income before taxes;                   (vii)  cash earnings;                   (viii) net interest income;                   (ix)   non-interest income;                   (x)    general and administrative expense to average assets ratio;                   (xi)   cash general and administrative expense to average assets ratio;                   (xii)  efficiency ratio;                   (xiii) cash efficiency ratio;                   (xiv)  return on average assets;                   (xv)   core return on average assets;                   (xvi)  cash return on average assets;                   (xvii) core return on equity;                   (xviii) return on average stockholders' equity;                   (xix)  cash return on average stockholders' equity;                   (xx)   return on average tangible stockholders' equity;                   (xxi)  cash return on average tangible stockholders' equity;                   (xxii) core earnings;                   (xxiii) operating income;                   (xxiv) operating efficiency ratio;                   (xxv)  net interest margin;                   (xxvi) net interest rate margin or net interest rate spread;                                                    A-3 

 

              (xxvii) growth in assets, loans, or deposits;                  (xxviii) loan production volume;                 (xxix)  net charge-offs;                  (xxx)   non-performing loans;                 (xxxi)  classified loans;                  (xxxii) cash flow;                  (xxxiii) capital preservation (core or risk-based);                  (xxxiv) interest rate risk exposure-net portfolio value;                  (xxxv) interest rate risk-sensitivity;                  (xxxvi) strategic business objectives, consisting of one or more objectives based upon meeting         specified financial targets, business expansion goals, and goals relating to acquisitions or divestitures, or         goals relating to capital raising and capital management;                   (xxxvii) stock price (including, but not limited to, growth measures and total stockholder return);                  (xxxviii) operating expense as a percentage of average assets;                  (xxxix) core deposits as a percentage of total deposits;                   (xl)   net charge-off percentage;                  (xli)  average percentage past due;                  (xlii) classified assets to total assets; or                  (xliii) any combination of the foregoing.          Performance measures may be based on the performance of the Company as a whole or on any one or more  Subsidiaries or business units of the Company or a Subsidiary and may be measured relative to a peer group, an  index or a business plan and may be considered as absolute measures or changes in measures.  In establishing any  performance measures, the Committee may provide for the exclusion of the effects of the following items, to the  extent identified in the audited financial statements of the Company, including footnotes, or in the Management’s  Discussion and Analysis section of the Company’s annual report or in the Compensation Discussion and Analysis  Section, if any, of the Company’s annual proxy statement:  (i) extraordinary, unusual, and/or nonrecurring items of  gain or loss; (ii) gains or losses on the disposition of a business; (iii) changes in tax or accounting principles,  regulations or laws; or (iv) mergers or acquisitions.  To the extent not specifically excluded, such effects shall be  included in any applicable performance measure.          (b)     Adjustments.  Pursuant to this Section 2.3, in certain circumstances the Committee may adjust  performance measures; provided, however, no adjustment may be made with respect to an Award that is intended to  be performance-based compensation within the meaning of Code Section 162(m), except to the extent the  Committee exercises such negative discretion as is permitted under applicable law for purposes of an exception  under Code Section 162(m).  If the Committee determines that a change in the business, operations, corporate  structure or capital structure of the Company or the manner in which the Company or its Subsidiaries conducts its  business or other events or circumstances render current performance measures to be unsuitable, the Committee may  modify such performance measures, in whole or in part, as the Committee deems appropriate.  If a Participant is                                                   A-4 

 

promoted, demoted or transferred to a different business unit during a performance period, the Committee may  determine that the selected performance measures or applicable performance period are no longer appropriate, in  which case, the Committee, in its sole discretion, may: (i) adjust, change or eliminate the performance measures or  change the applicable performance period; or (ii) cause to be made a cash payment to the Participant in an amount  determined by the Committee.           (c)    Treatment on Retirement.  Notwithstanding anything herein to the contrary, no Restricted Stock  Award that is intended to be considered performance-based compensation under Code Section 162(m) shall be  granted under terms that will permit its accelerated vesting upon Retirement or other termination of Service (other  than death or Disability).  Notwithstanding anything to the contrary herein, in the sole discretion of the Committee  exercised at the time of grant of an Award under this Section 2.3, in the event of Retirement of a Participant during  the performance period, the Award Agreement may provide for the vesting of all or a portion of such Award, so  long as the vesting is not accelerated but shall occur at the end of the performance period, and will be prorated,  based on the period of the Participant’s active employment and the level of achievement of the performance  measures during the period of the Participant’s active employment.           Section 2.4    Vesting of Awards.  (a) The Committee shall specify the vesting schedule or   conditions of each Award.  If the right to become vested in an Award under the Plan is conditioned on the   completion of a specified period of Service with the Company or its Subsidiaries, without achievement of   performance measures or other performance objectives being required as a condition of vesting, and without it being   granted in lieu of, or in exchange for, other compensation, then the required period of Service for full vesting shall   be determined by the Committee and evidenced in the Award Agreement (subject to acceleration of vesting, to the   extent permitted by the Committee, including in the event of the Participant’s death, Disability, Retirement or   Involuntary Termination of Employment following a Change in Control).  Unless otherwise provided by the   Committee, Service as a director emeritus or advisory director shall constitute Service for purposes of vesting.             (b)     Notwithstanding Section 2.6 and Article 4 hereof, other than with respect to Restricted Stock   subject to performance-based vesting conditions of Section 2.3, the Committee may determine that all Restricted   Stock Awards described in Section 2.2(a) shall be fully earned and vested immediately.            Section 2.5    Deferred Compensation.  If any Award would be considered “deferred compensation”   as defined under Code Section 409A (“Deferred Compensation”), the Committee reserves the absolute right   (including the right to delegate such right) to unilaterally amend the Plan or the Award Agreement, without the   consent of the Participant, to maintain exemption from, or to comply with, Code Section 409A.  Any amendment by   the Committee to the Plan or an Award Agreement pursuant to this Section 2.5 shall maintain, to the extent   practicable, the original intent of the applicable provision without violating Code Section 409A.  A Participant’s   acceptance of any Award under the Plan constitutes acknowledgement and consent to such rights of the Committee,   without further consideration or action.  Any discretionary authority retained by the Committee pursuant to the terms   of this Plan or pursuant to an Award Agreement shall not be applicable to an Award which is determined to   constitute Deferred Compensation, if such discretionary authority would contravene Code Section 409A.           Section 2.6    Effect of Termination of Service on Awards.  The Committee shall establish the effect   of a Termination of Service on the continuation of rights and benefits available under an Award or the Plan and, in   so doing, may make distinctions based upon, among other things, the cause of Termination of Service and type of   Award.   Unless otherwise specified by the Committee and set forth in an Award Agreement between the Company   and the Participant or as set forth in an employment agreement entered into by and between the Company and/or the   Bank and an Employee, the following provisions shall apply to each Award granted under this Plan:           (a)    Upon a Participant’s Termination of Service for any reason other than Disability or death, any  Restricted Stock that has not vested as of the date of Termination of Service shall expire and be forfeited.           (b)    In the event of a Termination of Service for Cause, all Restricted Stock granted to a Participant  that has not vested shall expire and be forfeited.             (c)    Upon Termination of Service because of Disability or death, and if specifically provided by the  Committee, upon Retirement (except in the case of Restricted Stock Awards subject to Section 2.3 hereof), all                                                   A-5 

 

Restricted Stock shall vest as to all shares subject to an outstanding Award, whether or not otherwise immediately  vested, at the date of Termination of Service.           (d)     Notwithstanding the provisions of this Section 2.6, the effect of a Change in Control on the   vesting of Restricted Stock is as set forth in Article 4.                                ARTICLE 3 - SHARES SUBJECT TO PLAN           Section 3.1    Available Shares.  The shares of Stock with respect to which Awards may be made   under the Plan shall be shares currently authorized but unissued, currently held or, to the extent permitted by   applicable law, subsequently acquired by the Company as treasury shares, including shares purchased in the open   market or in private transactions.           Section 3.2    Share Limitations.             (a)    Share Reserve.  Subject to the following provisions of this Section 3.2, the maximum number of  shares of Stock that may be delivered to Participants and their beneficiaries under the Plan shall be equal to five  hundred thousand (500,000) shares of Stock.               (b)    Computation of Shares Available.  For purposes of this Section 3.2 and in connection with the  granting of Restricted Stock, the number of shares of Stock available for the granting of additional Restricted  Stock shall be reduced by the number of shares of Stock in respect of which the Restricted Stock is granted or  denominated.  To the extent any shares of Stock covered by an Award under the Plan are not delivered to a  Participant or beneficiary for any reason, including because the Award is forfeited or canceled, then such shares  shall not be deemed to have been delivered for purposes of determining the maximum number of shares of Stock  available for delivery under the Plan.  To the extent shares of Stock are withheld to satisfy withholding taxes upon  exercise or vesting of an Award granted hereunder, the number of shares of Stock available shall be reduced by  the gross number of, rather than by the net number of, shares of Stock issued.           Section 3.3    Corporate Transactions.  In the event any recapitalization, forward or reverse stock   split, reorganization, merger, consolidation, spin-off, combination, repurchase, or exchange of shares of Stock or   other securities, stock dividend or other special and nonrecurring dividend or distribution (whether in the form of   cash, securities or other property), liquidation, dissolution, or other similar corporate transaction or event, affects the  shares of Stock such that an adjustment is appropriate in order to prevent dilution or enlargement of the rights of  Participants under the Plan and/or under any Award granted under the Plan, then the Committee shall, in an  equitable manner, adjust any or all of (i) the number and kind of securities deemed to be available thereafter for  grants of Restricted Stock in the aggregate to all Participants and individually to any one Participant and (ii) the  number and kind of securities that may be delivered or deliverable in respect of outstanding Restricted Stock.  In  addition, the Committee is authorized to make adjustments in the terms and conditions of, and the criteria included  in, Restricted Stock (including, without limitation, cancellation of Restricted Stock in exchange for the Fair Market  Value, if any, or substitution or exchange of Restricted Stock using stock of a successor or other entity) in  recognition of unusual or nonrecurring events (including, without limitation, events described in the preceding  sentence) affecting the Company or any parent or Subsidiary or the financial statements of the Company or any  parent or Subsidiary, or in response to changes in applicable laws, regulations, or accounting principles. Unless  otherwise determined by the Committee, any such adjustment to an Award intended to qualify as “performance- based compensation” shall conform to the requirements of Code Section 162(m) and the regulations thereunder then  in effect.           Section 3.4    Delivery of Shares.  Delivery of shares of Stock or other amounts under the Plan shall be   subject to the following:           (a)    Compliance with Applicable Laws.  Notwithstanding any other provision of the Plan, the  Company shall have no obligation to deliver any shares of Stock or make any other distribution of benefits under the  Plan unless such delivery or distribution complies with all applicable laws (including, the requirements of the  Securities Act), and the applicable requirements of any securities exchange or similar entity.                                                    A-6 

 

        (b)    Certificates.  To the extent that the Plan provides for the issuance of shares of Stock, the issuance  may be effected on a non-certificated basis, to the extent not prohibited by applicable law or the applicable rules of  any stock exchange.                                  ARTICLE 4 - CHANGE IN CONTROL           Section 4.1    Consequence of a Change in Control.  Subject to the provisions of Section 2.4 (relating   to vesting and acceleration) and Section 3.3 (relating to the adjustment of shares), and except as otherwise provided   in the Plan or as determined by the Committee and set forth in the terms of any Award Agreement or as set forth in   an employment agreement entered into by and between the Company and/or the Bank and an Employee:           (a)    At the time of an Involuntary Termination of Employment (as defined in Section 8.1) (or, as to a  Director, Termination of Service as a Director) following a Change in Control, all Awards of Restricted Stock  described in Section 2.2 shall be fully earned and vested immediately.  Notwithstanding the above, any Awards the  vesting of which are based on satisfaction of performance-based conditions will be vested as specified in subsection  (b) hereof.           (b)    In the event of a Change in Control, any performance measure attached to an Award under the  Plan shall be deemed satisfied as of the date of the Change in Control.           Section 4.2    Definition of Change in Control.  For purposes of the Plan, unless otherwise provided   in an Award Agreement, a “Change in Control” shall be deemed to have occurred upon the earliest to occur of the   following:            (a)    Merger:  The Company or the Bank merges into or consolidates with another entity, or merges   another bank or corporation into the Company or the Bank, and as a result, less than a majority of the combined   voting power of the resulting corporation immediately after the merger or consolidation is held by persons who were   stockholders of the Company or the Bank immediately before the merger or consolidation;           (b)     Acquisition of Significant Share Ownership:  There is filed, or is required to be filed, a report on   Schedule 13D or another form or schedule (other than Schedule 13G) required under Sections 13(d) or 14(d) of the   Securities Exchange Act of 1934, as amended, if the schedule discloses that the filing person or persons acting in   concert has or have become the beneficial owner of 25% or more of a class of the Company’s or the Bank’s voting   securities; provided, however, this clause (b) shall not apply to beneficial ownership of the Company’s or the Bank’s   voting shares held in a fiduciary capacity by an entity of which the Company directly or indirectly beneficially owns   50% or more of its outstanding voting securities;           (c)    Change in Board Composition:  During any period of two consecutive years, individuals who   constitute the Company’s or the Bank’s Board of Directors at the beginning of the two-year period cease for any  reason to constitute at least a majority of the Company’s or the Bank’s Board of Directors; provided, however, that  for purposes of this clause (c), each director who is first elected by the board (or first nominated by the board for  election by the stockholders) by a vote of at least two-thirds (2/3) of the directors who were directors at the  beginning of the two-year period shall be deemed to have also been a director at the beginning of such period; or           (d)     Sale of Assets:  The Company or the Bank sells to a third party all or substantially all of its assets.           Notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because any  Person (the “Subject Person”) acquired beneficial ownership of more than the permitted amount of the then  outstanding common stock or Voting Securities as a result of a change in the number of shares of Stock or Voting  Securities then outstanding, which thereby increases the proportional number of shares beneficially owned by the  Subject Person; provided, however, that if a Change in Control would occur (but for the operation of this sentence)  as a result of the acquisition of Stock or Voting Securities by the Company, and after such share acquisition by the  Company, the Subject Person becomes the beneficial owner of any additional Stock or Voting Securities which  increases the percentage of the then outstanding Stock or Voting Securities beneficially owned by the Subject  Person, then a Change in Control shall occur.  In the event that an Award constitutes Deferred Compensation, and                                                    A-7 

 

the settlement of, or distribution of benefits under, such Award is to be triggered solely by a Change in Control, then  with respect to such Award, a Change in Control shall be defined as required under Code Section 409A, as in effect  at the time of such transaction.                                         ARTICLE 5 - COMMITTEE           Section 5.1    Administration. The Plan shall be administered by the members of the Compensation   Committee of the Company who are Disinterested Board Members.  If the Committee consists of fewer than three   Disinterested Board Members, then the Board shall appoint to the Committee such additional Disinterested Board   Members as shall be necessary to provide for a Committee consisting of at least three Disinterested Board Members.    Any members of the Committee who do not qualify as Disinterested Board Members shall abstain from participating   in any discussion to make or administer Awards that are made to Participants who at the time of consideration for   such Award: (i) are persons subject to the short-swing profit rules of Section 16 of the Exchange Act, or (ii) are  reasonably anticipated to be Covered Employees during the term of the Award.  The Board (or those members of the  Board who are “independent directors” under the corporate governance statutes or rules of any national securities  exchange on which the Company lists its securities) may, in its discretion, take any action and exercise any power,  privilege or discretion conferred on the Committee under the Plan with the same force and effect under the Plan as if  done or exercised by the Committee.             Section 5.2    Powers of Committee.  The administration of the Plan by the Committee shall be subject   to the following:           (a)    the Committee will have the authority and discretion to select from among the Company’s and its  Subsidiaries’ Employees and Directors those persons who shall receive Awards, to determine the time or times of  receipt, to determine the types of Awards and the number of shares covered by the Awards, to establish the terms,  conditions, performance criteria, restrictions (including without limitation, provisions relating to non-competition,  non-solicitation and confidentiality), and other provisions of such Awards (subject to the restrictions imposed by  Article 6) to cancel or suspend Awards and to reduce, eliminate or accelerate any restrictions or vesting  requirements applicable to an Award at any time after the grant of the Award.           (b)    The Committee will have the authority and discretion to interpret the Plan, to establish, amend and  rescind any rules and regulations relating to the Plan, and to make all other determinations that may be necessary or  advisable for the administration of the Plan.           (c)    The Committee will have the authority to define terms not otherwise defined herein.             (d)    Any interpretation of the Plan by the Committee and any decision made by it under the Plan is  final and binding on all persons.           (e)    In controlling and managing the operation and administration of the Plan, the Committee shall  take action in a manner that conforms to the charter and bylaws of the Company and applicable corporate law.           Section 5.3    Delegation by Committee.  Except to the extent prohibited by applicable law, the   applicable rules of a stock exchange or the Plan, or as necessary to comply with the exemptive provisions of Rule   16b-3 promulgated under the Exchange Act or Code Section 162(m), the Committee may allocate all or any portion   of its responsibilities and powers to any one or more of its members and may delegate all or any part of its   responsibilities and powers to any person or persons selected by it, including:  (a) delegating to a committee of one   or more members of the Board who are not “outside directors” within the meaning of Code Section 162(m), the   authority to grant Awards under the Plan to eligible persons who are not persons with respect to whom the Company   wishes to comply with Code Section 162(m); and/or (b) delegating to a committee of one or more members of the   Board who are not “non-employee directors,” within the meaning of Rule 16b-3, the authority to grant Awards   under the Plan to eligible persons who are not then subject to Section 16 of the Exchange Act.   The acts of such  delegates shall be treated hereunder as acts of the Committee and such delegates shall report regularly to the  Committee regarding the delegated duties and responsibilities and any Awards so granted.  Any such allocation or  delegation may be revoked by the Committee at any time.                                                    A-8 

 

        Section 5.4    Information to be Furnished to Committee.  As may be permitted by applicable law,   the Company and its Subsidiaries shall furnish the Committee with such data and information as it determines may   be required for it to discharge its duties.  The records of the Company and its Subsidiaries as to a Participant’s  employment, termination of employment, leave of absence, reemployment and compensation shall be conclusive on  all persons unless determined by the Committee to be manifestly incorrect.  Subject to applicable law, Participants   and other persons entitled to benefits under the Plan must furnish the Committee such evidence, data or information   as the Committee considers desirable to carry out the terms of the Plan.           Section 5.5    Committee Action.   The Committee shall hold such meetings, and may make such   administrative rules and regulations, as it may deem proper. A majority of the members of the Committee shall   constitute a quorum, and the action of a majority of the members of the Committee present at a meeting at which a   quorum is present, as well as actions taken pursuant to the unanimous written consent of all of the members of the   Committee without holding a meeting, shall be deemed to be actions of the Committee. Subject to Section 5.1, all   actions of the Committee shall be final and conclusive and shall be binding upon the Company, Participants and   all other interested parties. Any person dealing with the Committee shall be fully protected in relying upon any   written notice, instruction, direction or other communication signed by a member of the Committee or by a   representative of the Committee authorized to sign the same in its behalf.                            ARTICLE 6 - AMENDMENT AND TERMINATION           Section 6.1    General.  The Board may, as permitted by law, at any time, amend or terminate the Plan,   and may amend any Award Agreement, provided that no amendment or termination (except as provided in   Section 2.5, Section 3.3 and Section 6.2) may cause the Award to violate Code Section 409A, or, in the absence of   written consent to the change by the affected Participant (or, if the Participant is not then living, the affected   beneficiary), adversely impair the rights of any Participant or beneficiary under any Award granted under the Plan   prior to the date such amendment is adopted by the Board; provided, however, that, no amendment may   (a) materially increase the benefits accruing to Participants under the Plan, (b) materially increase the aggregate   number of securities which may be issued under the Plan, other than pursuant to Section 3.4, or (c) materially   modify the requirements for participation in the Plan, unless the amendment under (a), (b) or (c) above is approved   by the Company’s stockholders.           Section 6.2    Amendment to Conform to Law and Accounting Changes.      Notwithstanding any   provision in this Plan or any Award Agreement to the contrary, the Committee may amend the Plan or any Award   Agreement, to take effect retroactively or otherwise, as deemed necessary or advisable for the purpose of (i)   conforming the Plan or the Award Agreement to any present or future law relating to plans of this or similar nature   (including, but not limited to, Code Section 409A), or (ii) avoiding an accounting treatment resulting from an   accounting pronouncement or interpretation thereof issued by the Securities and Exchange Commission or Financial   Accounting Standards Board subsequent to the adoption of the Plan or the making of the Award affected thereby,   which, in the sole discretion of the Committee, may materially and adversely affect the financial condition or results   of operations of the Company.  By accepting an Award under this Plan, each Participant agrees and consents to any   amendment made pursuant to this Section 6.2 or Section 2.5 to any Award granted under the Plan without further   consideration or action.                                     ARTICLE 7 - GENERAL TERMS           Section 7.1    No Implied Rights.           (a)    No Rights to Specific Assets.  Neither a Participant nor any other person shall by reason of  participation in the Plan acquire any right in or title to any assets, funds or property of the Company or any  Subsidiary whatsoever, including any specific funds, assets, or other property which the Company or any  Subsidiary, in its sole discretion, may set aside in anticipation of a liability under the Plan.  A Participant shall have  only a contractual right to the shares of Stock or amounts, if any, payable or distributable under the Plan, unsecured  by any assets of the Company or any Subsidiary, and nothing contained in the Plan shall constitute a guarantee that  the assets of the Company or any Subsidiary shall be sufficient to pay any benefits to any person.                                                    A-9 

 

        (b)    No Contractual Right to Employment or Future Awards.  The Plan does not constitute a contract  of employment, and selection as a Participant will not give any participating Employee the right to be retained in the  employ of the Company or any Subsidiary or any right or claim to any benefit under the Plan, unless such right or  claim has specifically accrued under the terms of the Plan.  No individual shall have the right to be selected to   receive an Award under the Plan, or, having been so selected, to receive a future Award under the Plan.           Section 7.2    Transferability.  Awards of Restricted Stock shall not be transferable prior to the time   that such Awards vest in the Participant.             Section 7.3    Designation of Beneficiaries.  A Participant hereunder may file with the Company a   written designation of a beneficiary or beneficiaries under this Plan and may from time to time revoke or amend any   such designation (“Beneficiary Designation”).  Any designation of beneficiary under this Plan shall be controlling   over any other disposition, testamentary or otherwise (unless such disposition is pursuant to a domestic relations   order); provided, however, that if the Committee is in doubt as to the entitlement of any such beneficiary to any  Award, the Committee may determine to recognize only the legal representative of the Participant, in which case the  Company, the Committee and the members thereof shall not be under any further liability to anyone.           Section 7.4    Non-Exclusivity.  Neither the adoption of this Plan by the Board nor the submission of   the Plan to the stockholders of the Company for approval shall be construed as creating any limitations on the power   of the Board or the Committee to adopt such other incentive arrangements as either may deem desirable, including,   without limitation, the granting of Restricted Stock otherwise than under the Plan or an arrangement that is or is not   intended to qualify under Code Section 162(m), and such arrangements may be either generally applicable or   applicable only in specific cases.           Section 7.5    Award Agreement.  Each Award granted under the Plan shall be evidenced by an Award   Agreement signed by the Participant.  A copy of the Award Agreement, in any medium chosen by the Committee,   shall be provided (or made available electronically) to the Participant.           Section 7.6    Form and Time of Elections/Notification Under Section 83(b).  Unless otherwise   specified herein, each election required or permitted to be made by any Participant or other person entitled to   benefits under the Plan, and any permitted modification or revocation thereof, shall be filed with the Company at   such times, in such form, and subject to such restrictions and limitations, not inconsistent with the terms of the Plan,   as the Committee shall require.  Notwithstanding anything herein to the contrary, the Committee may, on the date of   grant or at a later date, as applicable, prohibit an individual from making an election under Code Section 83(b).  If   the Committee has not prohibited an individual from making this election, an individual who makes this election   shall notify the Committee of the election within ten (10) days of filing notice of the election with the Internal   Revenue Service.  This requirement is in addition to any filing and notification required under the regulations issued   under the authority of Code Section 83(b).           Section 7.7    Evidence.  Evidence required of anyone under the Plan may be by certificate, affidavit,   document or other information upon which the person is acting considers pertinent and reliable, and signed, made or   presented by the proper party or parties.           Section 7.8    Tax Withholding.  Where a Participant is entitled to receive shares of Stock upon the   vesting or exercise of an Award, the Company shall have the right to require such Participant to pay to the   Company the amount of any tax that the Company is required to withhold with respect to such vesting or   exercise, or, in lieu thereof, to retain, or to sell without notice, a sufficient number of shares of Stock to cover the   minimum amount required to be withheld. To the extent determined by the Committee and specified in an Award   Agreement, a Participant shall have the right to direct the Company to satisfy the minimum required federal, state  and local tax withholding by withholding a number of shares (based on the Fair Market Value on the vesting  date) otherwise vesting that would satisfy the minimum amount of required tax withholding.  Provided there are   no adverse accounting consequences to the Company (a requirement to have liability classification of an award   under Financial Accounting Standards Board Accounting Standards Codification (ASC) Topic 718 (formerly,   FAS 123R) is an adverse consequence), a Participant who is not required to have taxes withheld may require the   Company to withhold in accordance with the preceding sentence as if the Award were subject to minimum tax   withholding requirements.                                                  A-10 

 

        Section 7.9    Action by Company or Subsidiary.  Any action required or permitted to be taken by the   Company or any Subsidiary shall be by resolution of its board of directors, or by action of one or more members of   the Board (including a committee of the Board) who are duly authorized to act for the Board, or (except to the extent   prohibited by applicable law or applicable rules of any stock exchange) by a duly authorized officer of the Company   or such Subsidiary.           Section 7.10   Successors.  All obligations of the Company under the Plan shall be binding upon and   inure to the benefit of any successor to the Company, whether the existence of such successor is the result of a direct   or indirect purchase, merger, consolidation or otherwise, of all or substantially all of the business, stock, and/or   assets of the Company.           Section 7.11   Indemnification.  To the fullest extent permitted by law and the Company’s governing   documents, each person who is or shall have been a member of the Committee, or of the Board, or an officer of the   Company to whom authority was delegated in accordance with Section 5.3, or an Employee of the Company, shall   be indemnified and held harmless by the Company against and from any loss (including amounts paid in settlement),   cost, liability or expense (including reasonable attorneys’ fees) that may be imposed upon or reasonably incurred by   him or her in connection with or resulting from any claim, action, suit, or proceeding to which he or she may be a   party or in which he or she may be involved by reason of any action taken or failure to act under the Plan and   against and from any and all amounts paid by him or her in settlement thereof, with the Company’s approval, or paid   by him or her in satisfaction of any judgment in any such action, suit, or proceeding against him or her, provided he   or she shall give the Company an opportunity, at its own expense, to handle and defend the same before he or she   undertakes to handle and defend it on his or her own behalf, unless such loss, cost, liability, or expense is a result of   his or her own willful misconduct or except as expressly provided by statute or regulation.  The foregoing right of   indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled   under the Company’s charter or bylaws, as a matter of law, or otherwise, or any power that the Company may have   to indemnify them or hold them harmless.           Section 7.12   No Fractional Shares.  Unless otherwise permitted by the Committee, no fractional   shares of Stock shall be issued or delivered pursuant to the Plan or any Award.  The Committee shall determine   whether cash or other property shall be issued or paid in lieu of fractional shares or whether such fractional shares or   any rights thereto shall be forfeited or otherwise eliminated.           Section 7.13   Governing Law.   The Plan, all Awards granted hereunder, and all actions taken in   connection herewith shall be governed by and construed in accordance with the laws of the Commonwealth of   Massachusetts without reference to principles of conflict of laws, except as superseded by applicable federal law.    The federal and state courts located in the Commonwealth of Massachusetts, shall have exclusive jurisdiction   over any claim, action, complaint or lawsuit brought under the terms of the Plan.  By accepting any award under   this Plan, each Participant and any other person claiming any rights under the Plan agrees to submit himself and   any legal action that the Participant brings under the Plan, to the sole jurisdiction of such courts for the   adjudication and resolution of any such disputes.           Section 7.14   Benefits Under Other Plans.  Except as otherwise provided by the Committee or as set   forth in a Qualified Retirement Plan, Awards to a Participant (including the grant and the receipt of benefits) under   the Plan shall be disregarded for purposes of determining the Participant’s benefits under, or contributions to, any   Qualified Retirement Plan, non-qualified plan and any other benefit plans maintained by the Participant’s employer.   The term “Qualified Retirement Plan” means any plan of the Company or a Subsidiary that is intended to be  qualified under Code Section 401(a).           Section 7.15   Validity.  If any provision of this Plan is determined to be illegal or invalid for any   reason, said illegality or invalidity shall not affect the remaining parts hereof, but this Plan shall be construed and  enforced as if such illegal or invalid provision has never been included herein.           Section 7.16   Notice.  Unless otherwise provided in an Award Agreement, all written notices and all   other written communications to the Company provided for in the Plan or in any Award Agreement, shall be   delivered personally or sent by registered or certified mail, return receipt requested, postage prepaid (provided that  international mail shall be sent via overnight or two-day delivery), or sent by facsimile, email or prepaid overnight                                                  A-11 

 

courier to the Company at its principal executive office.  Such notices, demands, claims and other communications  shall be deemed given:           (a)    in the case of delivery by overnight service with guaranteed next day delivery, the next day or the  day designated for delivery;           (b)    in the case of certified or registered U.S. mail, five (5) days after deposit in the U.S. mail; or           (c)    in the case of facsimile or email, the date upon which the transmitting party received confirmation  of receipt; provided, however, that in no event shall any such communications be deemed to be given later than the  date they are actually received, provided they are actually received.     In the event a communication is not received, it shall only be deemed received upon the showing of an original of  the applicable receipt, registration or confirmation from the applicable delivery service.  Communications that are to  be delivered by U.S. mail or by overnight service to the Company shall be directed to the attention of the  Company’s Chief Operating Officer and to the Corporate Secretary.           Section 7.17   Forfeiture Events.             (a)    The Committee may specify in an Award Agreement that the Participant’s rights, payments, and  benefits with respect to an Award shall be subject to reduction, cancellation, forfeiture or recoupment upon the  occurrence of certain specified events, in addition to any otherwise applicable vesting or performance conditions of  an Award.  Such events include, but are not limited to, termination of employment for cause, termination of the  Participant’s provisions of Services to the Company or any Subsidiary, violation of material Company or Subsidiary  policies, breach of noncompetition, confidentiality, or other restrictive covenants that may apply to the Participant,  or other conduct of the Participant that is detrimental to the business or reputation of the Company or any  Subsidiary.           (b)    If the Company is required to prepare an accounting restatement due to the material  noncompliance of the Company, as a result of misconduct, with any financial reporting requirement under the  federal securities laws, any Participant who is subject to automatic forfeiture under Section 304 of the Sarbanes- Oxley Act of 2002 shall reimburse the Company the amount of any payment in settlement of an Award earned (or  the Company shall reverse the corresponding accrual) during the twelve (12) month period following the first public  issuance or filing with the United States Securities and Exchange Commission (whichever first occurred) of the  financial document embodying such financial reporting requirement.           In addition, in the event of an accounting restatement, the Committee, in its sole and exclusive discretion,  may require that any Participant reimburse the Company for all or any part of the amount of any payment in  settlement of any Award granted hereunder.                            ARTICLE 8 - DEFINED TERMS; CONSTRUCTION           Section 8.1    In addition to the other definitions contained herein, unless otherwise specifically  provided in an Award Agreement, the following definitions shall apply:           (a)    “10% Stockholder” means an individual who, at the time of grant, owns stock possessing more  than ten percent (10%) of the total combined voting power of all classes of stock of the Company.           (b)    “Award” means any Restricted Stock, including performance-based shares under Section 2.3,  granted to a Participant under the Plan.           (c)    “Award Agreement” means the document (in whatever medium prescribed by the Committee)  which evidences the terms and conditions of an Award under the Plan.  Such document is referred to as an  agreement, regardless of whether a Participant’s signature is required.                                                   A-12 

 

        (d)    “Board” means the Board of Directors of the Company.           (e)    If the Participant is subject to a written employment agreement (or other similar written  agreement) with the Company or a Subsidiary that provides a definition of termination for “Cause,” then, for  purposes of this Plan, the term “Cause” shall have meaning set forth in such agreement.  In the absence of such a  definition, “Cause” means (i) the conviction of the Participant of a felony or of any lesser criminal offense involving  moral turpitude; (ii) the willful commission by the Participant of a criminal or other act that, in the judgment of the  Board, will likely cause substantial economic damage to the Company or any Subsidiary or substantial injury to the  business reputation of the Company or any Subsidiary; (iii) the commission by the Participant of an act of fraud in  the performance of his duties on behalf of the Company or any Subsidiary; (iv) the continuing willful failure of the  Participant to perform his duties to the Company or any Subsidiary (other than any such failure resulting from the  Participant’s incapacity due to physical or mental illness) after written notice thereof; or (v) an order of a federal or  state regulatory agency or a court of competent jurisdiction requiring the termination of the Participant’s Service  with the Company.           (f)    “Change in Control” has the meaning ascribed to it in Section 4.2.             (g)    “Code” means the Internal Revenue Code of 1986, as amended, and any rules, regulations and  guidance promulgated thereunder, as modified from time to time.           (h)    “Code Section 409A” means the provisions of Section 409A of the Code and any rules,  regulations and guidance promulgated thereunder, as modified from time to time.           (i)    “Committee” means the Committee acting under Article 5.           (j)    “Covered Employee” has the meaning given the term in Code Section 162(m), and shall also  include any other Employee who may become a Covered Employee before an Award vests, as the Committee may  determine in its sole discretion.           (k)    “Director” means a member of the Board of Directors of the Company or a Subsidiary.           (l)    If the Participant is subject to a written employment agreement (or other similar written  agreement) with the Company or a Subsidiary that provides a definition of “Disability” or “Disabled,” then, for  purposes of this Plan, the terms “Disability” or “Disabled” shall have meaning set forth in such agreement.  In the  absence of such a definition, “Disability” shall be defined in accordance with the Bank’s long-term disability plan.   To the extent that an Award hereunder is subject to Code Section 409A, “Disability” or “Disabled” shall mean that a  Participant:  (i) is unable to engage in any substantial gainful activity by reason of any medically determinable  physical or mental impairment which can be expected to result in death or can be expected to last for a continuous  period of not less than twelve (12) months; or (ii) is, by reason of any medically determinable physical or mental  impairment which can be expected to result in death or can be expected to last for a continuous period of not less  than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under  an accident and health plan covering the Company’s Employees.  Except to the extent prohibited under Code  Section 409A, if applicable, the Committee shall have discretion to determine if a termination due to Disability has  occurred.            (m)    “Disinterested Board Member” means a member of the Board who: (a) is not a current Employee  of the Company or a Subsidiary; (b) is not a former employee of the Company who receives compensation for prior  Services (other than benefits under a tax-qualified retirement plan) during the taxable year; (c) has not been an  officer of the Company; (d) does not receive remuneration from the Company or a Subsidiary, either directly or  indirectly, in any capacity other than as a Director except in an amount for which disclosure would not be required  pursuant to Item 404 of SEC Regulation S-K in accordance with the proxy solicitation rules of the SEC, as  amended or any successor provision thereto; and (e) does not possess an interest in any other transaction, and is  not engaged in a business relationship for which disclosure would be required pursuant to Item 404(a) of SEC  Regulation S-K under the proxy solicitation rules of the SEC, as amended or any successor provision thereto. The  term Disinterested Board Member shall be interpreted in such manner as shall be necessary to conform to the                                                   A-13 

 

requirements of section 162(m) of the Code, Rule 16b-3 promulgated under the Exchange Act and the corporate  governance standards imposed on compensation committees under the listing requirements imposed by any  national securities exchange on which the Company lists or seeks to list its securities.            (n)     “Employee” means any person employed by the Company or any Subsidiary. Directors who are   also employed by the Company or a Subsidiary shall be considered Employees under the Plan.           (o)     “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.           (p)     “Excluded Transaction” means a plan of reorganization, merger, consolidation or similar   transaction that would result in the Voting Securities of the Company outstanding immediately prior thereto   continuing to represent (either by remaining outstanding or by being converted into Voting Securities of the   surviving corporation or any parent thereof) at least 50% of the combined voting power of the Voting Securities of   the entity surviving the plan of reorganization, merger, consolidation or similar transaction (or the parent of such   surviving entity) immediately after such plan of reorganization, merger, consolidation or similar transaction.           (r)    “Fair Market Value” means, with respect to a share of Stock on a specified date:                  (i)     the final reported sales price on the date in question (or if there is no reported sale on          such date, on the last preceding date on which any reported sale occurred) as reported in the principal          consolidated reporting system with respect to securities listed or admitted to trading on the principal          United States securities exchange on which the shares of Stock are listed or admitted to trading, as of the          close of the market in New York City and without regard to after-hours trading activity; or                  (ii)    if the shares of Stock are not listed or admitted to trading on any such exchange, the          closing bid quotation with respect to a share of Stock on such date, as of the close of the market in New          York City and without regard to after-hours trading activity, or, if no such quotation is provided, on          another similar system, selected by the Committee, then in use.           (s)    A termination of employment by an Employee Participant shall be deemed a termination of  employment for “Good Reason” as a result of the Participant’s resignation from the employ of the Company or  any Subsidiary upon the occurrence of any of the following events following a Change in Control: (a) the failure  of the Company or Subsidiary to appoint or re-appoint or elect or re-elect the Employee Participant to the  position(s) with the Company or Subsidiary held immediately prior to the Change in Control; (b) a material  change in the functions, duties or responsibilities of the Employee Participant compared to those functions, duties  or responsibilities in effect immediately prior to the Change in Control; (c) any reduction of the rate of the  Employee Participant’s base salary in effect immediately prior to the Change in Control; (d) any failure (other  than due to reasonable administrative error that is cured promptly upon notice) to pay any portion of the  Employee  Participant’s compensation as and when due; (e) any change in the terms and conditions of any  compensation or benefit program in which the Employee Participant participated immediately prior to the Change  in Control which, either individually or together with other changes, has a material adverse effect on the  aggregate value of his total compensation package; or (f) a change in the Employee Participant’s principal place  of employment, without his consent, to a place that is at least thirty (30) miles further away from the Employee  Participant’s principal residence prior to the Change in Control.           (t)    “Immediate Family Member” means with respect to any Participant: (a) any of the Participant’s  children, stepchildren, grandchildren, parents, stepparents, grandparents, spouses, former spouses, siblings,  nieces, nephews, mothers-in-law, fathers-in-law, sons-in-law, daughters-in-law, brothers-in-law or sisters-in-law,  including relationships created by adoption; (b) any natural person sharing the Participant’s household (other than  as a tenant or employee, directly or indirectly, of the Participant); (c) a trust in which any combination of the  Participant and persons described in section (a) and (b) above own more than fifty percent (50%) of the beneficial  interests; (d) a foundation in which any combination of the Participant and persons described in sections (a) and  (b) above control management of the assets; or (e) any other corporation, partnership, limited liability company  or other entity in which any combination of the Participant and persons described in sections (a) and (b) above  control more than fifty percent (50%) of the voting interests.                                                   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        (u)    “Incumbent Directors” means:                  (i)     the individuals who, on the date hereof, constitute the Board; and                   (ii)    any new Director whose appointment or election by the Board or nomination for election          by the Company’s stockholders was approved or recommended: (a) by the vote of at least two-thirds (2/3)          of the Whole Board, with at least two-thirds of the Incumbent Directors then in office voting in favor of          such approval or recommendation; or (b) by a Nominating Committee of the Board whose members were          appointed by the vote of at least two-thirds (2/3) of the Whole Board, with at least two-thirds of the          Incumbent Directors then in office voting in favor of such appointments.           (v)    “Involuntary Termination of Employment” means the Termination of Service by the Company or  Subsidiary (other than a termination for Cause) or termination of employment by a Participant Employee for Good  Reason.           (w)     “Participant” means any individual who has received, and currently holds, an outstanding Award  under the Plan.           (x)    “Restricted Stock” has the meaning ascribed to it in Section 2.2.            (y)    “Retirement” means, unless otherwise specified in an Award Agreement, retirement from   employment as an Employee on or after the attainment of age 65, or Termination of Service as a Director on or after   the attainment of age 70, provided, however, that unless otherwise specified in an Award Agreement, an Employee   who is also a Director shall not be deemed to have terminated due to Retirement until both Service as an Employee   and Service as a Director has ceased.  A non-Employee Director will be deemed to have terminated due to   Retirement under the provisions of this Plan only if the non-Employee Director has terminated Service on the   Board(s) of Directors of the Company and any Subsidiary or affiliate in accordance with applicable Company   policy, following the provision of written notice to such Board(s) of Directors of the non-Employee Director’s  intention to retire.             (z)    “SEC” means the United States Securities and Exchange Commission.           (aa)   “Securities Act” means the Securities Act of 1933, as amended from time to time.           (bb)   “Service” means service as an Employee, service provider, or non-employee Director of the  Company or a Subsidiary, as the case may be, and shall include service as a director emeritus or advisory director.           (cc)   “Stock” means the common stock of the Company, $0.01 par value per share.           (dd)    “Subsidiary” means any corporation, affiliate, bank or other entity which would be a subsidiary  corporation with respect to the Company as defined in Code Section 424(f) and, other than with respect to an ISO,  shall also mean any partnership or joint venture in which the Company and/or other Subsidiary owns more than fifty  percent (50%) of the capital or profits interests.           (ee)   “Termination of Service” means the first day occurring on or after a grant date on which the  Participant ceases to be an Employee or Director of, or service provider to, the Company or any Subsidiary,  regardless of the reason for such cessation, subject to the following:                    (i)     The Participant’s cessation as an Employee or service provider shall not be deemed to          occur by reason of the transfer of the Participant between the Company and a Subsidiary or between two          Subsidiaries.                  (ii)    The Participant’s cessation as an Employee or service provider shall not be deemed to          occur by reason of the Participant’s being on a bona fide leave of absence from the Company or a          Subsidiary approved by the Company or Subsidiary otherwise receiving the Participant’s Services,                                                   A-15 

 

        provided such leave of absence does not exceed six months, or if longer, so long as the Employee retains a          right to reemployment with the Company or Subsidiary under an applicable statute or by contract.  For          these purposes, a leave of absence constitutes a bona fide leave of absence only if there is a reasonable          expectation that the Employee will return to perform Services for the Company or Subsidiary.  If the period          of leave exceeds six months and the Employee does not retain a right to reemployment under an applicable          statute or by contract, the employment relationship is deemed to terminate on the first day immediately          following such six month period.  For purposes of this sub-section (ii), to the extent applicable, an          Employee’s leave of absence shall be interpreted by the Committee in a manner consistent with Treasury          Regulation Section 1.409A-1(h)(1).                  (iii)   If, as a result of a sale or other transaction, the Subsidiary for whom Participant is          employed (or to whom the Participant is providing Services) ceases to be a Subsidiary, and the Participant          is not, following the transaction, an Employee of the Company or an entity that is then a Subsidiary, then          the occurrence of such transaction shall be treated as the Participant’s Termination of Service caused by the          Participant being discharged by the entity for whom the Participant is employed or to whom the Participant          is providing Services.                  (iv)    A service provider whose Services to the Company or a Subsidiary are governed by a          written agreement with the service provider will cease to be a service provider at the time the term of such          written agreement ends (without renewal); and a service provider whose Services to the Company or a          Subsidiary are not governed by a written agreement with the service provider will cease to be a service          provider on the date that is ninety (90) days after the date the service provider last provides Services          requested by the Company or any Subsidiary (as determined by the Committee).                  (v)     Except to the extent Section 409A of the Code may be applicable to an Award, and          subject to the foregoing paragraphs of this sub-section (ee), the Committee shall have discretion to          determine if a Termination of Service has occurred and the date on which it occurred.  In the event that any          Award under the Plan constitutes Deferred Compensation (as defined in Section 2.5 hereof), the term          Termination of Service shall be interpreted by the Committee in a manner consistent with the definition of          “Separation from Service” as defined under Code Section 409A and under Treasury Regulation Section          1.409A-1(h)(ii).  For purposes of this Plan, a “Separation from Service” shall have occurred if the Bank and          Participant reasonably anticipate that no further Services will be performed by the Participant after the date          of the Termination of Service (whether as an employee or as an independent contractor) or the level of          further Services performed will be less than 50% of the average level of bona fide Services in the 36          months immediately preceding the Termination of Service.  If a Participant is a “Specified Employee,” as          defined in Code Section 409A and any payment to be made hereunder shall be determined to be subject to          Code Section 409A, then if required by Code Section 409A, such payment or a portion of such payment (to          the minimum extent possible) shall be delayed and shall be paid on the first day of the seventh month          following Participant’s Separation from Service.                  (vi)    With respect to a Participant who is a director, cessation as a Director will not be deemed          to have occurred if the Participant continues as a director emeritus or advisory director.  With respect to a          Participant who is both an Employee and a Director, termination of employment shall not constitute          Termination of Service so long as the Participant continued to serve as a Director.           (ff)   “Voting Securities” means any securities which ordinarily possess the power to vote in the  election of directors without the happening of any pre-condition or contingency.           (gg)   “Whole Board” means the total number of Directors that the Company would have if there were  no vacancies on the Board at the time the relevant action or matter is presented to the Board for approval.           Section 8.2    In this Plan, unless otherwise stated or the context otherwise requires, the following uses  apply:           (a)    actions permitted under this Plan may be taken at any time and from time to time in the actor’s  reasonable discretion;                                                  A-16 

 

        (b)    references to a statute shall refer to the statute and any successor statute, and to all regulations  promulgated under or implementing the statute or its successor, as in effect at the relevant time;           (c)    in computing periods from a specified date to a later specified date, the words “from” and  “commencing on” (and the like) mean “from and including,” and the words “to,” “until” and “ending on” (and the  like) mean “to, but excluding”;           (d)    references to a governmental or quasi-governmental agency, authority or instrumentality shall also  refer to a regulatory body that succeeds to the functions of the agency, authority or instrumentality;            (e)    indications of time of day mean Massachusetts time;           (f)    “including” means “including, but not limited to”;           (g)    all references to sections, schedules and exhibits are to sections, schedules and exhibits in or to  this Plan unless otherwise specified;           (h)    all words used in this Plan will be construed to be of such gender or number as the circumstances  and context require;           (i)    the captions and headings of articles, sections, schedules and exhibits appearing in or attached to  this Plan have been inserted solely for convenience of reference and shall not be considered a part of this Plan nor  shall any of them affect the meaning or interpretation of this Plan or any of its provisions;            (j)    any reference to a document or set of documents in this Plan, and the rights and obligations of the  parties under any such documents, shall mean such document or documents as amended from time to time, and any  and all modifications, extensions, renewals, substitutions or replacements thereof; and           (k)    all accounting terms not specifically defined herein shall be construed in accordance with GAAP.                                                           A-17

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