Document:

EXHIBIT 4.02

 

GERDAU S.A.

CNPJ/MF no 33.611.500/0001-19

NIRE no 33300032266

Public Held Company

 

STOCK OPTION PLAN TO BE DENOMINATED AS THE ‘LONG-TERM INCENTIVE PROGRAM’.

 

1 — OBJECTIVES OF THE PROGRAM

 

1.1. THE LONG-TERM INCENTIVE PROGRAM (hereafter the “PROGRAM”), which grants stock options for the purchase of shares of GERDAU S.A. (hereafter, “GERDAU”), has the objectives of:

 

a — Attracting and retaining strategic executives;

 

b — Offering a long-term system of remuneration aligned with shareholders interest;

 

c — Sharing the growth and success of GERDAU and its directly and indirectly controlled subsidiaries; and

 

d — Strengthening the feeling of participation and collaboration in the company’s business.

 

2 — ADMINISTRATION

 

2.1. The administration of the PROGRAM shall be the responsibility of the Compensation and Succession Committee (the “COMMITTEE”).

 

2.2. The COMMITTEE shall have full authority regarding the organization, execution and administration of the PROGRAM, in accordance with the terms and basic conditions of this plan, the directives of the Board of Directors of GERDAU and legislation.

 

2.3. The COMMITTEE’s powers shall include the right to establish the rules relating to the granting of stock options on a year-to-year basis.

 

2.4. The COMMITTEE shall be responsible for the indication of individuals who fulfill the requirements and are in the position to be selected as participants of the PROGRAM, who will be granted stock options, tied or not to business results as well as the number of shares object of the stock options within the time limits established herein.

 

2.5. In exercising its attributions and its authority with regards to the PROGRAM, the COMMITTEE shall be subject only to the limits established in item 2.2 above, not being obliged by analogy or rule of isonomy to extend to other directors, officers or employees in similar situations and conditions it understands are applicable only to one or more specific beneficiaries.

 

3 — ELIGIBILITY

 

3.1. Individuals eligible for the PROGRAM shall include directors, executive officers and high-level employees of GERDAU and it’s directly or indirectly controlled subsidiaries (which are included in the concept of the Company for the purposes of this plan). The selection of directors, executive officers and employees (hereafter, “EXECUTIVE” or “EXECUTIVES”) that may be entitled to stock options shall be made exclusively by the COMMITTEE.

 

4 — STOCK OPTIONS GRANT

 

4.1. The stock options will be granted to the eligible EXECUTIVES, as established in the item 3 above, always in the last working da of December of each year.

 

 

5 — SHARES INCLUDED IN THE PROGRAM

 

5. 1— The granting of the stock options of GERDAU preferred shares can be in an amount equivalent from 5% (five per cent) to 20% (twenty per cent) per annum of the basic annual salary or compensation of each of the EXECUTIVES selected to be part in the PROGRAM as determined by the COMMITTEE. The granting of the stock options to the Board Members can be of up to 120% (one hundred and twenty per cent) per annum of the basic annual salary or compensation and the granting of stock options to the Chief Executive Officer (CEO) and Chief Operating Officer (COO) can be of up to 50% (fifty per cent) of the basic annual salary or compensation. For this program, the basic annual salary or compensation of the Board Members shall be 12 (twelve) times their monthly salary or compensation paid by the company in the month of December and for the Chief Executive Officer (CEO); Chief Operating Officer (COO); and other EXECUTIVES it shall be defined as equal to 13 (thirteen) times the monthly salary or compensation paid by the company in the month of December.

 

Additionally, each year it shall be reserved the equivalent to 20% (twenty per cent) of the total amount of shares included in the PROGRAM, except for those granted to the Board Members, to be distributed by the Gerdau Executive Committee to the strategic executives, individually, as a retention tool. The options granted under this purpose will be calculated based on the average price of the grant date.

 

6 — ACQUISITION OF THE RIGHT TO EXERCISE THE STOCK OPTIONS

 

6.1. The COMMITTEE will establish, in each case, vesting and expiration rules as well as conditions under which the stock options will become exercisable under the PROGRAM. As a general rule that may be altered by the COMMITTEE, in each case, the right to exercise the stock options shall take the following form and periods:

 

a) after 05 (five) years from the grant date;

 

b) the EXECUTIVE will have to exercise the stock options paying the exercise price which correspond to the average price of the shares on the grant date;

 

c) The exercise of the stock options must happen within a maximum period of 5 (five) years, after which the EXECUTIVE shall no longer be entitled to the right to this specific tranche of stock options ;

 

d) ) In the event that GERDAU issues stock bonus during the period in which the right to exercise the stock options have not yet taken place, the referred number of stock options shall be increased in proportion to the stock bonus issued, diluting the price of exercise of the stock option in the same proportion; and

 

e) the EXECUTIVES occupying positions of the Board Member; Chief Executive Officer (CEO), Chief Operating Officer (COO), Vice-President, Director and others that may be indicated by the COMMITTEE, beyond the criteria’s established on items a), b), c) and d) above, will have 50% of their stock options granted tied to a business performance metric as approved annually by the Executive Committee. In case such targets threshold are not met, the referred stock options will be cancelled, otherwise will continue to be valid proportionally to the results achieved capped at 100% of the grant.

 

7 — EXERCISE OF THE STOCK OPTION

 

7.1. The Stock Option may be exercised by the EXECUTIVE in total or in part, in accordance with the terms of Item 6.1, a), c) and e) above.

 

7.2. The terms and conditions of the awards under this PROGRAM shall be determined by the COMMITTE, and will comprehend:

 

a) the number of stock options to be granted, the exercise price or the conditions to determine the exercise price;;

 

b) the business performance metrics as referred on item 6.1, e) above; and

 

c) other terms and conditions that the COMMITTEE considers to be relevant that have not been specified herein.

 

 

7.3. The contracts to which this item refers shall be executed under the specification hereby determined and in accordance with the terms of Art. 118 of Law No. 6,404/76 and shall be recorded in the Company’s registers.

 

8 — CONDITIONS OF PAYMENT

 

8.1. The price of the acquired shares shall be immediately due, in Brazilian national currency, unless the COMMITTEE establishes provisions to the contrary.

 

9 —  TAXES

 

9.1. Operations to be effected as part of the PROGRAM shall be subject to taxation in the form established in the law. EXECUTIVES or their beneficiary will be directly and exclusively responsible to withhold any tax due.

 

10 — EXPIRATION OF THE STOCK OPTION

 

10.1. The stock option shall be considered to have expired for all intents and purposes in any of the situations bellow:

 

a) as a result of its exercise in full, as established in this PROGRAM;

 

b) as a result of the expiration of the exercise period;

 

c) in case the business performance metrics are not met as foreseen in item 6.1, e) above;

 

d) as a result of the EXECUTIVE’s termination from the Company and repurchase of such options by the Company;

 

e) In the event of the involuntary termination of the EXECUTIVE from the Company without cause, the EXECUTIVE that has already acquired the right to exercise as a result of the ending of the vesting period, shall retain this right of exercise for 06 (six) months from termination date to exercise the vested options, as foreseen in item 6.1, a) and c) above or to receive in cash the equivalent amount of the appreciation of the referred shares. The options not yet vested, as foreseen in item 6.1, a) above will be automatically cancelled; and

 

f) when the EXECUTIVE is dismissed with cause, the EXECUTIVE shall lose the right to receive any amount relating to the PROGRAM, regardless of whether the vesting period has ended or not.

 

11 — RETIREMENT OF THE EXECUTIVE

 

11.1. In the event of retirement of the EXECUTIVE through Gerdau or Governmental retiring Plan or both, followed by contract termination, the EXECUTIVE shall be granted the right to exercise all the vested and unvested stock options granted to him/her immediately which must be exercised within 2 (two) years from the termination date.

 

11.2. EXECUTIVES that holds the right to stock options tied to business performance metrics, which the vesting period have not yet been fully completed, shall have the right to exercise the options proportionally to the number of months of each period, considering for the purpose of measuring the achieved results, the average results achieved in such period. The right to exercise such options must be within 30 days after the termination date.

 

12 — MANDATE TERMINATION

 

12.1. In the case of termination of a Board Member mandate, the EXECUTIVE shall be granted the right to exercise all the vested and unvested stock options granted to him/her immediately which must be exercised within 2 (two) years from the termination date.

 

12.2. Board Members that holds the right to options tied to business performance metrics, which the vesting period have not yet been fully completed, shall have the right to exercise the options proportionally to the number of months of each period, considering for the purpose of measuring the achieved results, the average results achieved in such period. The right to exercise such options must be within 30 days after the mandate termination date.

 

 

13 — DECEASE OF THE EXECUTIVE

 

13.1. In the event of the decease of the EXECUTIVE, his/her, heirs/heiresses shall immediately be granted the right to exercise the vested and unvested stock options assigned to the deceased individual, which must be exercised the lesser between the expiration date or within 2 (two) years from the date of passing away.

 

13.2. his/her, heirs/heiresses will also have the right to exercise the options tied to business performance metrics, which the vesting period have not yet been fully completed, proportionally to the number of months of each period, considering for the purpose of measuring the achieved results, the average results achieved in such period. The right to exercise such options must be within 30 days after the termination date.

 

14 — PERIOD OF VALIDITY

 

14.1. The PROGRAM shall take effect after it is approved by Gerdau’s General Shareholder’s Meeting.

 

15 — ALTERATIONS OR TERMINATION OF THE PROGRAM

 

15.1. By decision of the Board of Directors, alterations may be made to the PROGRAM, in the event that the gains proposed under the Compensation Policy diverge significantly from the objective established for Direct Remuneration.

 

15.2. In the event that it is necessary to implement changes or to terminate the PROGRAM, such events shall be announced to the EXECUTIVES in writing with at least 30 (thirty) days’ prior notice, as of the date of modification or termination.

 

15.3. The modifications to or termination of the PROGRAM shall not affect rights that have already been signed to EXECUTIVES, except in the following circumstances:

 

a) GERDAU shall not be under any obligation to reestablish the PROGRAM or compensate the EXECUTIVES for expected future gains or losses; and

 

b) in the event that the PROGRAM is modified, any subsequent profit opportunity may be implemented in accordance with terms that differ from those previously established.

 

16 — MANDATE

 

16.1. To the perfect execution of all terms and conditions herein foreseen, the EXECUTIVE, when become participant in this PROGRAM, will grant the company powers of attorney, irrevocably and irreversibly, with powers to sign all necessary actions relating to the PROGRAM, including with power to delegate

 

17 — GENERAL CONDITIONS

 

17.1. In the event of a change in control of GERDAU, options attributed to EXECUTIVES more than 12 months prior to the event shall be considered as free for exercise, regardless of the 05 (five) years vesting period have not been met. The stock options tied to results attributed to EXECUTIVES more than 12 months prior to the event also shall be considered as free for exercise, regardless of the 05 (five) years vesting period have not been met, however, proportional to the results achieved, considering for such purpose the average result achieved in the period.

 

17.2. Whenever the EXECUTIVE decides to sell shares of his/her property, the Company shall have priority in buying these shares at the market price of the day of the operation.

 

17.3. EXECUTIVES who are beneficiaries of the PROGRAM shall be subject to restrictive rules on the use of privileged information applying to publicly listed companies in general, as well as to rules for the trading of securities of publicly listed companies within the special segment of the São Paulo Stock Exchange (“BOVESPA”) that apply to GERDAU.

 

 

17.4. The exercise of the Stock Options referred in this Program, at the Company discretion, may be done through shares purchased in the market for that purpose or by new shares issued specifically for this purpose, in accordance with the terms of Art. 168 §  3o of Law 6.404/76.

 

17.5. In the event of the granting and subsequent exercise of the call options object of this PROGRAM, shareholders shall not enjoy preference rights in accordance with the terms of Art. 171, §3 of Law 6,404/76.Exhibit 10.10

 

BROOKLINE BANK
 CHANGE IN CONTROL AGREEMENT

 

This Agreement is made effective as of the 1st day of January 2008, by and between Paul R. Bechet (“Executive”) and Brookline Bank, a federally chartered stock savings bank (the “Bank”).

 

WHEREAS, Executive is serving in the position of Executive Vice President and Chief Financial Officer for the Bank, a position of substantial responsibility.

 

WHEREAS, the Bank recognizes the significant contribution Executive has made to the Bank and desires to protect Executive’s position in the event of a “Change in Control,” as defined in this Agreement.

 

NOW, THEREFORE, in consideration of the services of Executive agreeing to serve in the position set forth above, and upon the other terms and conditions hereinafter provided, the parties hereto agree as follows:

 

1.                                      TERM OF AGREEMENT

 

The initial term of this Agreement shall be for a period of twelve (12) months from the date set forth above (the “Effective Date”).  Commencing on the anniversary date of this Agreement and continuing on each anniversary date thereafter, this Agreement will extend for an additional twelve (12) months unless the Bank provides written notice of non-renewal to Executive at least thirty (30) days and not more than sixty (60) days prior to such anniversary date, in which case this Agreement will become fixed and will terminate at the end of the then current term.  Notwithstanding any other provision of this Section 1, this Agreement shall remain in effect upon the public announcement of an event that, if consummated, would result in a “Change in Control,” as defined in Section 2(b) hereof, and for a period of twelve (12) months after the closing or completion of the Change in Control.

 

2.                                      PAYMENTS TO EXECUTIVE UPON CHANGE IN CONTROL

 

(a)                                  Upon the occurrence of a “Change in Control” (as herein defined) of the Bank or Brookline Bancorp, Inc. (the “Company”) followed at any time during the term of this Agreement by (i) the involuntary termination of Executive’s employment, other than for “Cause,” as defined in Section 2(c) hereof, or (ii) the voluntary termination of Executive’s employment during the term of this Agreement following any demotion, loss of office or significant authority, reduction in annual compensation or benefits, or relocation of Executive’s principal place of employment by more than 30 miles from its location immediately prior to the Change in Control, then the provisions of Section 3 shall apply.  Upon the occurrence of any events mentioned in clause (ii) of this Section 2(a), Executive shall have the right to elect to terminate his employment under this Agreement by resignation within thirty (30) days prior written notice given with a reasonable time not to exceed ninety (90) days after the initial event giving rise to the right to elect to voluntary terminate employment.  The Bank shall have at least thirty (30) days to remedy any condition set forth in clause (ii) of this Section 2(a), provided, however, that the Bank shall be entitled to waive such period and make an immediate payment hereunder.

 

(b)                                 A “Change in Control” of the Bank or the Company shall mean a change in control of a nature that: (i) would be required to be reported in response to Item 5.01 of the current report on Form 8-K, as in effect on the date hereof, pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 (the “Exchange Act”); or (ii) results in a Change in Control of the Bank or the Company within the meaning of the Home Owners’ Loan Act, as amended, and applicable rules and regulations promulgated thereunder (collectively the “HOLA”), as in effect at the time of the Change in Control; or (iii) without 

 

 

limitation such a Change in Control shall be deemed to have occurred at such time as (a) any “person” (as the term is used in Sections 13(d) and 14(d) of the Exchange Act) is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 25% or more of the combined voting power of Company’s outstanding securities except for any securities purchased by the Bank’s employee stock ownership plan or trust; or (b) individuals who constitute the Board on the date hereof (the “Incumbent Board”) cease for any reason to constitute at least a majority thereof, provided that any person becoming a director subsequent to the date hereof whose election was approved by a vote of at least three-quarters of the directors comprising the Incumbent Board, or whose nomination for election by the Company’s stockholders was approved by the same Nominating Committee serving under an Incumbent Board, shall be, for purposes of this clause (b), considered as though he were a member of the Incumbent Board; or (c) a plan of reorganization, merger, consolidation, sale of all or substantially all the assets of the Bank or the Company or similar transaction in which the Bank or Company is not the surviving institution occurs; or (d) a proxy statement soliciting proxies from stockholders of the Company, by someone other than the current management of the Company, seeking stockholder approval of a plan of reorganization, merger or consolidation of the Company or similar transaction with one or more corporations as a result of which the outstanding shares of the class of securities then subject to the plan are to be exchanged for or converted into cash or property or securities not issued by the Company; or (e) a tender offer is made for 25% or more of the voting securities of the Company and the shareholders owning beneficially or of record 25% or more of the outstanding securities of the Company have tendered or offered to sell their shares pursuant to such tender offer and such tendered shares have been accepted by the tender offeror.

 

(c)                                  Executive shall not have the right to receive termination benefits pursuant to Section 3 hereof upon Termination for Cause.  The term termination for “Cause” shall mean termination because of Executive’s intentional failure to perform stated duties, personal dishonesty, incompetence, willful misconduct, any breach of fiduciary duty involving personal profit, willful violation of any law, rule, regulation (other than traffic violations or similar offenses) or final cease and desist order, or any material breach of any material provision of this Agreement.  A voluntary resignation pursuant to Section 2(a)(ii) shall not constitute, nor be grounds for termination for Cause.  In determining incompetence, the acts or omissions shall be measured against standards generally prevailing in the savings institution industry.

 

3.                                      TERMINATION

 

(a)                                  Upon the occurrence of a Change in Control, followed at any time during the term of this Agreement by the involuntary termination of Executive’s employment other than a termination for Cause, or the voluntary termination of Executive’s employment by Executive after the occurrence of an event set forth in Section 2(a) hereof, the Bank shall be obligated to pay Executive, or in the event of Executive’s subsequent death, Executive’s beneficiary or beneficiaries, or Executive’s estate, as the case may be, as severance pay, a sum equal to the Executive’s current annual base salary and the cash incentive paid to the Executive, attributable to the prior year.

 

(b)                                 Upon the occurrence of a Change in Control of the Bank followed at any time during the term of this Agreement by Executive’s involuntary termination of employment (other than for termination for Cause) or the voluntary termination of Executive’s employment as set forth in Section 2(a) hereof, the Bank shall cause to be continued, at the Bank’s expense (or the expense of its successors), life insurance and nontaxable medical and dental coverage substantially identical to the coverage maintained by the Bank for Executive prior to Executive’s severance.  Such coverage and payments shall cease upon expiration of twelve (12) months.

 

(c)                                  Notwithstanding paragraphs (a) and (b) of this Section 3, in no event shall the aggregate payments or benefits to be made or afforded to Executive under said paragraphs (the “Termination 

 

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Benefits”) constitute an “excess parachute payment” under Section 280G of the Code or any successor thereto, and in order to avoid such a result Termination Benefits will be reduced, if necessary, to an amount (the “Non-Triggering Amount”), the value of which is one dollar ($1.00) less than an amount equal to three (3) times Executive’s “base amount,” as determined in accordance with said Section 280G. The allocation of the reduction required hereby among Termination Benefits provided by the preceding paragraphs of this Section 3 shall be determined by Executive, provided however that if it is determined that such election by Executive shall be in violation of Code Section 409A, the allocation of the required reduction shall be pro-rata.

 

(d)                                 Any cash severance payments shall be made in a lump sum within thirty (30) days after Executive’s termination of employment.  Such payments shall not be reduced or eliminated in the event Executive obtains other employment following termination of employment with the Bank.  Not withstanding the foregoing, in the event Executive is a “Specified Employee” (within the meaning of Treasury Regulations §1.409A-1(i)), and if the following is required to avoid a violation of Code Section 409A, no payment shall be made to Executive under this Section prior to the first day of the seventh month following Executive’s termination of employment in excess of the “permitted amount” under Code Section 409A.  For these purposes, the “permitted amount” shall be an amount that does not exceed two times the lesser of: (i) the sum of Executive’s annualized compensation based upon the annual rate of pay for services provided to the Bank for the calendar year preceding the year in which Executive terminates employment pursuant to this Section, or (ii) the maximum amount that may be taken into account under a tax-qualified plan pursuant to Code Section 401(a)(17) for the calendar year in which occurs Executive’s termination of employment.  Payment of the “permitted amount” shall be made within thirty (30) days following Executive’s termination of employment, and any payment in excess of the permitted amount shall be paid to Executive on the first day of the seventh month following Executive’s termination of employment.

 

(e)                                  For purposes of this Section 3, “termination of employment” as used herein shall be construed to require a “Separation from Service” as defined in Code Section 409A and the Treasury Regulations promulgated thereunder, provided, however, that the Bank and Executive reasonably anticipate that the level of bona fide services Executive would perform after termination would permanently decrease to a level that is less than 50% of the average level of bona fide services performed (whether as an employee or an independent contractor) over the immediately preceding 36-month period.

 

4.                                      NOTICE OF TERMINATION

 

(a)                                  Any termination by the Bank or by Executive shall be communicated by Notice of Termination to the other party hereto.  For purposes of this Agreement, a “Notice of Termination” shall mean a written notice which shall indicate the specific termination provision in this Agreement relied upon and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Executive’s employment under the provision so indicated and shall be communicated to the other party no later than thirty (30) days after the occurrence of the event(s) or circumstance(s) that provides the basis for termination.

 

(b)                                 “Date of Termination” shall mean the date specified in the Notice of Termination (which, in the case of a termination for Cause, shall be immediate). In no event shall the Date of Termination exceed thirty (30) days from the date Notice of Termination is given.

 

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5.                                      POST-TERMINATION OBLIGATIONS

 

All payments and benefits to Executive under this Agreement shall be subject to Executive’s compliance with this Section 5 during the term of this Agreement and for one (1) full year after the expiration or termination hereof.

 

Executive shall, upon reasonable notice, furnish such information and assistance to the Bank as may reasonably be required by the Bank in connection with any litigation in which it or any of its subsidiaries or affiliates is, or may become, a party.

 

6.                                      SOURCE OF PAYMENTS

 

All payments provided in this Agreement shall be paid by check from the general funds of the Bank.

 

7.                                      EFFECT ON PRIOR AGREEMENTS AND EXISTING BENEFIT PLANS

 

This Agreement contains the entire understanding between the parties hereto and supersedes any prior agreement between the Bank and Executive, except that this Agreement shall not affect or operate to reduce any benefit or compensation inuring to Executive of a kind elsewhere provided.  No provision of this Agreement shall be interpreted to mean that Executive is subject to receiving fewer benefits than those available to Executive without reference to this Agreement.

 

8.                                      NO CONTRACT OF EMPLOYMENT

 

This Agreement shall not create a contract of employment between Executive and the Bank or the Company, and any payments to Executive under this Agreement shall occur only pursuant to Section 3(a) hereof following a Change in Control.

 

9.                                      NO ATTACHMENT

 

Except as required by law, no right to receive payments under this Agreement shall be subject to anticipation, commutation, alienation, sale, assignment, encumbrance, charge, pledge, or hypothecation, or to execution, attachment, levy, or similar process or assignment by operation of law, and any attempt, voluntary or involuntary, to affect any such action shall be null, void, and of no effect.

 

10.                               MODIFICATION AND WAIVER

 

(a)                                  This Agreement may not be modified or amended except by an instrument in writing signed by the parties hereto.

 

(b)                                 No term or condition of this Agreement shall be deemed to have been waived, nor shall there be any estoppel against the enforcement of any provision of this Agreement, except by written instrument of the party charged with such waiver or estoppel.  No such written waiver shall be deemed a continuing waiver unless specifically stated therein, and each such waiver shall operate only as to the specific term or condition waived and shall not constitute a waiver of such term or condition for the future as to any act other than that specifically waived.

 

11.                               SEVERABILITY

 

If, for any reason, any provision of this Agreement, or any part of any provision, is held invalid, such invalidity shall not affect any other provision of this Agreement or any part of such provision not 

 

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held so invalid, and each such other provision and part thereof shall to the full extent consistent with law continue in full force and effect.

 

12.                               HEADINGS FOR REFERENCE ONLY

 

The headings of sections and paragraphs herein are included solely for convenience of reference and shall not control the meaning or interpretation of any of the provisions of this Agreement.

 

13.                               GOVERNING LAW

 

This Agreement shall be governed by the laws of the Commonwealth of Massachusetts, but only to the extent not superseded by federal law.

 

14.                               ARBITRATION

 

Any dispute or controversy arising under or in connection with this Agreement shall be settled exclusively by arbitration, conducted by a single arbitrator (who shall be selected by mutual agreement of the Bank and Executive), sitting in a location selected by the Bank within fifty (50) miles from the main office of the Bank, in accordance with the rules of the American Arbitration Association then in effect.  Judgment may be entered on the arbitrator’s award in any court having jurisdiction.

 

15.                               PAYMENT OF LEGAL FEES

 

All reasonable legal fees paid or incurred by Executive pursuant to any dispute or question of interpretation relating to this Agreement shall be paid or reimbursed by the Bank provided that the dispute or interpretation has been settled by Executive and the Bank or resolved in Executive’s favor, and that such reimbursement shall occur no later than two and one-half months after the dispute is settled or resolved in Executive’s favor.

 

16.                               SUCCESSORS AND ASSIGNS

 

This Agreement shall be binding upon, and inure to the benefit of the Bank and its successors and assigns.  The Bank shall require any successor or assignee, whether direct or indirect, by purchase, merger, consolidation or otherwise, to all or substantially all the business or assets of the Bank or the Company, expressly and unconditionally to assume and agree to perform the Bank’s obligations under this Agreement, in the same manner and to the same extent that the Bank would be required to perform if no such succession or assignment had taken place.

 

17.                               REQUIRED PROVISIONS

 

(a)                                  The Bank may terminate Executive’s employment at any time.  Executive shall not have the right to receive compensation or other benefits for any period after termination for “Cause” as defined in Section 2(c) herein above.

 

(b)                                 If Executive is suspended from office and/or temporarily prohibited from participating in the conduct of the Bank’s affairs by a notice served under Section 8(e)(3) (12 U.S.C. §1818(e)(3)) or 8(g) (12 U.S.C. §1818(g)) of the Federal Deposit Insurance Act, as amended, the Bank’s obligations under this Agreement shall be suspended as of the date of service, unless stayed by appropriate proceedings.  If the charges in the notice are dismissed, the Bank may in its discretion (i) pay Executive all or part of the compensation withheld while its contract obligations were suspended, and (ii) reinstate (in whole or in part) any of the obligations which were suspended.

 

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(c)                                  If Executive is removed and/or permanently prohibited from participating in the conduct of the Bank’s affairs by an order issued under Section 8(e) (12 U.S.C. §1818(e)) or 8(g) (12 U.S.C. §1818(g)) of the Federal Deposit Insurance Act, as amended, all obligations of the Bank under this Agreement shall terminate as of the effective date of the order, but vested rights of the contracting parties shall not be affected.

 

(d)                                 If the Bank is in default as defined in Section 3(x) (12 U.S.C. §1813(x)(1)) of the Federal Deposit Insurance Act, as amended, all obligations of the Bank under this Agreement shall terminate as of the date of default, but this paragraph shall not affect any vested rights of the contracting parties.

 

(e)                                  All obligations of the Bank under this Agreement shall be terminated, except to the extent determined that continuation of this Agreement is necessary for the continued operation of the Bank, (i) by the Federal Deposit Insurance Corporation (“FDIC”), at the time the FDIC enters into an agreement to provide assistance to or on behalf of the Bank under the authority contained in Section 13(c) (12 U.S.C. §1823(c)) of the Federal Deposit Insurance Act, as amended, or (ii) when the Bank is determined by the FDIC to be in an unsafe or unsound condition.  Any rights of the parties that have already vested, however, shall not be affected by such action.

 

(f)                                    Notwithstanding anything herein contained to the contrary, any payments to Executive by the Bank, whether pursuant to this Agreement or otherwise, are subject to and conditioned upon their compliance with Section 18(k) of the Federal Deposit Insurance Act, 12 U.S.C. § 1828(k), and the regulations promulgated thereunder in 12 C.F.R. Part 359.

 

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IN WITNESS WHEREOF, the Bank has caused this Agreement to be executed and its seal to be affixed hereunto by its duly authorized officer, and Executive has signed this Agreement, effective as of the date first above written.

 

	
ATTEST:
    	
 
    	
BROOKLINE   BANK
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
/s/ Charles H. Peck
    	
 
    	
By:
    	
/s/ Richard P. Chapman,   Jr.
    
	
 
    	
 
    	
 
    	
    Richard   P. Chapman, Jr., Chairman
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
WITNESS:
    	
 
    	
EXECUTIVE:
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
/s/ Stephen M. Hansen
    	
 
    	
By:
    	
/s/ Paul R. Bechet
    
	
 
    	
 
    	
 
    	
    Paul   R. Bechet
    

 

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