UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549


FORM 8-K
CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  December 21, 2022

ECB BANCORP, INC.
(Exact Name of Registrant as Specified in Its Charter)

Maryland
  
001-41456
  
88-1502079
(State or Other Jurisdiction of Incorporation)
  
(Commission File No.)
  
(I.R.S. Employer Identification No.)

419 Broadway, Everett, Massachusetts 02149
(Address of principal executive offices) (Zip Code)

(617) 387-1110
(Registrant’s telephone number, including area code)

Not Applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class
Trading symbol(s)
Name of each exchange on which registered
Common Stock, Par Value $0.01 Per Share
ECBK
The Nasdaq Stock Market LLC


Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

Emerging growth company  ☒
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐


Item 5.02
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On December 21, 2022, ECB Bancorp, Inc. (the “Company”), the holding company for Everett Co-operative Bank (the “Bank”) and the Bank, entered into an employment agreement with Richard J. O’Neil, Jr., the President and Chief Executive Officer of the Company the Bank. On December 21, 2022, the Bank also entered into change in control agreements with John Citrano, Executive Vice President, Chief Operating Officer and Chief Financial Officer of the Company and the Bank, and John A. Migliozzi, Executive Vice President and Chief Lending Officer of the Bank. The Company is also a party to the change in control agreements solely for purposes of guaranteeing the performance of the Bank thereunder.

On January 3, 2022, the Bank entered into a confidentiality and non-solicitation agreement with Mr. Migliozzi in connection with his offer of employment with the Bank.

A.
Employment Agreement

The Company, the Bank and Mr. O’Neil entered into an employment agreement on December 21, 2022. The employment agreement has an initial term of three years. Commencing on December 21, 2023 and continuing each December 21st thereafter, the term of the employment agreement extends for an additional year, so that the term again becomes three years. Prior to the renewal of the term of the employment agreement, the disinterested members of the Boards of Directors of the Company and the Bank (collectively the “Board”) must conduct a comprehensive performance evaluation of Mr. O’Neil and affirmatively approve any extension of the agreement for an additional year or determine not to extend the term of the agreement. If the Board determines not to extend the term, it must notify Mr. O’Neil at least 30 days, but not more than 60 days, prior to the applicable renewal date. If a change in control occurs during the term of the employment agreement, the term of the employment agreement will automatically renew for two years from the effective date of the change in control.

The employment agreement provides Mr. O’Neil with an annual base salary of $425,000. The Board will review Mr. O’Neil’s base salary at least annually and the base salary may be increased, but not decreased during the term of the employment agreement. In addition to receiving a base salary, Mr. O’Neil is eligible to participate in any bonus programs and benefit plans that are made available to other Bank and Company senior executives. The employment agreement also provides that Mr. O’Neil will receive a monthly automobile allowance of $1,000 and is eligible for the reimbursement of all reasonable business expenses incurred in performing his duties as President and Chief Executive Officer of the Bank and the Company.

Under the terms of the employment agreement, in the event Mr. O’Neil voluntarily terminates employment with the Company and the Bank without “good reason,” Mr. O’Neil will be entitled to receive the sum of: (i) his earned and unpaid salary as of his termination date and (ii) his earned and unpaid annual bonus and long-term incentive compensation as of his termination date (his “Accrued Obligations”).


In the event Mr. O’Neil’s employment involuntary terminates for reasons other than cause, disability, or death, or in the event of his resignation for “good reason,” in either event other than in connection with a change in control, Mr. O’Neil is entitled to his Accrued Obligations and his base salary for the remaining term of the employment agreement. In addition, Mr. O’Neil is entitled to continued coverage under the Bank’s health insurance plans (to the extent permitted by the plans and law) until the earlier of 18 months following his termination date or his procurement of health insurance coverage under another plan.

In the event Mr. O’Neil’s employment involuntary terminates for reasons other than cause, disability, or death, or in the event of Mr. O’Neil’s resignation for “good reason,” in either case within 24 months following a change in control, Mr. O’Neil will receive his Accrued Obligations, along with a single lump sum payment equal to three (3) times the sum of his base salary and average cash bonus earned during the three years preceding the change in control.   In addition, Mr. O’Neil will be provided with continued coverage under the Bank’s health insurance plans (to the extent permitted by the plans and law) until the earlier of 18 months following his termination date or the procurement of health insurance coverage under another plan. In the event continued coverage is not permitted under plans or by law, Mr. O’Neil will receive a lump sum cash payment equal to the total cost of Consolidated Omnibus Budget Reconciliation Act (COBRA) coverage for 18 months following his termination date.

The employment agreement includes a “best net benefits” provision if the change in control severance benefits under the employment agreement or otherwise result in “excess parachute payments” under Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”). The best net benefits approach would reduce Mr. O’Neil’s payments and benefits, if necessary, to avoid triggering an excise tax if the reduction would result in a greater after-tax amount paid to him than compared to the payments and benefits he would receive net of the excise tax if no reduction were made to the payment and benefits.

For purposes of the employment agreement, “good reason” includes (i) a change in the nature, scope or status of Mr. O’Neil’s positions, authority or duties, (ii) a material reduction in his compensation or benefits (other than one that is part of an overall adjustment in benefits for all employees), (iii) a relocation of his principal place of employment by more than 25 miles from the Bank’s main office location; (iv) the failure of an acquiror to assume the employment agreement at the time of a change in control or (v) a material breach of the employment agreement by the  Company or the Bank.

Should Mr. O’Neil become disabled during the term of the employment agreement, he will be entitled to his Accrued Obligations plus disability benefits, if any, provided under a long-term disability plan sponsored by the Bank. In the event Mr. O’Neil dies while employed by the Bank, his beneficiaries will receive his Accrued Obligations plus any benefit payable under the group-term life insurance program sponsored by the Bank.

Upon any separation from service that would entitle Mr. O’Neil to a severance payment under the terms of the employment agreement, Mr. O’Neil will be required to adhere to one-year non-competition and non-solicitation covenants.


The foregoing description of the employment agreement does not purport to be complete and is qualified in its entirety by reference to the employment agreement attached hereto as Exhibit 10.1.

B.
Change in Control Agreements

The Bank entered into a change in control agreement with Mr. Citrano and Mr. Migliozzi on December 21, 2022. The Company is also a party to the change in control agreements solely for purposes of guaranteeing the performance of the Bank.  The change in control agreement with Mr. Citrano has an initial term of three years and the change in control agreement with Mr. Migliozzi has an initial term of two years.  Commencing on December 21, 2023 and continuing each December 21st thereafter, the term of the change in control agreements with Messrs. Citrano and Migliozzi will extend for an additional year, so that the term again becomes three years for Mr. Citrano and two years for Mr. Migliozzi. Prior to the renewal of the term of the change in control agreements, the Chief Executive Officer of the Bank must conduct a comprehensive performance evaluation of the executives and the Board of Directors must approve any extension of the term of the change in control agreements or determine not to extend the term of the agreements.

In the event either executive’s employment involuntary terminates for reasons other than cause, or in the event of the executive’s resignation for “good reason,” (which is defined in the same manner as the term is defined in Mr. O’Neil’s employment agreement), in either event within 24 months following a change in control, the executive will receive his Accrued Obligations and a single lump sum cash payment, equal to two and one-half times the sum of his base salary and average bonus earned during the three years preceding the change in control for Mr. Citrano, and two times the sum of his base salary and average bonus earned during the three years preceding the change in control for Mr. Migliozzi.  In addition, the executives will be provided with continued coverage under the Bank’s health insurance plans (to the extent permitted by the plans and law) in which they were participating as of their termination date, until the earlier of 18 months following the termination date or the procurement of health insurance coverage under another plan. In the event continued coverage is not permitted under plans or by law, the executives will receive a lump sum cash payment equal to the total cost of COBRA coverage for 18 months following the termination date.

The change in control agreements include a “best net benefits” provision if the change in control severance benefits under the change in control agreement or otherwise result in “excess parachute payments” under Section 280G of the Code. The best net benefits approach would reduce the executive’s payments and benefits, if necessary, to avoid triggering an excise tax if the reduction would result in a greater after-tax amount paid compared to the payments and benefits an executive would receive net of the excise tax if no reduction were made to the payment and benefits.

The foregoing description of the change in control agreements does not purport to be complete and is qualified in its entirety by reference to the change in control agreements attached hereto as Exhibits 10.2 and 10.3.

C.
Confidentiality and Non-Solicitation Agreement

The Bank entered into a confidentiality and non-solicitation agreement with Mr. Migliozzi on January 3, 2022. Pursuant to the confidentiality and non-solicitation agreement, Mr. Migliozzi is prohibited, with limited exceptions, from disclosing to third-parties information deemed confidential under the agreement which is provided to him by the Bank or derived by him from his employment at the Bank. Under the agreement, generally, during his employment with the Bank and for a period of twelve months following his termination of employment with the Bank, regardless of the reason for such termination, Mr. Migliozzi is prohibited from directly or indirectly soliciting or inducing the hiring by a third-party of an employee, consultant or independent contractor of the Bank. The agreement also prohibits, with limited exceptions, for a period of twelve months from the date of his termination from employment with the Bank, Mr. Migliozzi from soliciting, interfering with, or trying to entice away from the Bank, any relationship between the Bank and a current or prospective customer of the Bank.

The foregoing description of the confidentiality and non-solicitation agreement does not purport to be complete and is qualified in its entirety by reference to the confidentiality and non-solicitation agreement attached hereto as Exhibits 10.4.

Item 9.01 Financial Statements and Other Exhibits.
 
(d)
Exhibits
  
     
 
Number
Description
     
 
Employment Agreement for Richard J. O’Neil, Jr.
 
Change in Control Agreement for John Citrano
 
Change in Control Agreement for John Migliozzi
 
Confidentiality and Non-Solicitation Agreement for John Migliozzi
 
104
Cover Page Interactive Data File (embedded within the Inline XBRL document)






SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

   
ECB BANCORP, INC.
     
     
Date: December 22, 2022
By:   
/s/ Richard J. O’Neil, Jr.
   
Richard J. O’Neil, Jr.
   
President and Chief Executive Officer



Exhibit 10.1

EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (“Agreement”) is made and entered into on December 21, 2022 (“Effective Date”), by and between ECB Bancorp, Inc. (the “Company”), a Maryland corporation, Everett Co-operative Bank (the “Bank”) and Richard J. O’Neil, Jr. (the “Executive”) (collectively the “Parties”).
Background
A. The Company and the Bank wish to employ the Executive on the terms and conditions provided herein, and the Executive wishes to continue in such capacity on the terms and conditions provided herein.
B. The Company and the Bank wish to encourage the Executive to devote his full time and attention to the faithful performance of his responsibilities and pursuing the best interests of the Company and the Bank.
C. The Company and the Bank employ the Executive in a position of trust and confidence, and the Executive has become acquainted with the Company’s Business, its officers and employees, its strategic and operating plans, its business practices, processes, and relationships, the needs and expectations of its Customers and Prospective Customers, and its trade secrets and other property, including Confidential Information (“Company’s Business,” “Customers” and “Confidential Information” are defined in Section 11 herein).
NOW, THEREFORE, in consideration of the premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties to this Agreement agree as follows:
1.
Term.
(a) The term of this Agreement shall commence as of the Effective Date and shall continue thereafter for a period of three (3) years.
(b) Commencing on the first anniversary of the Effective Date and continuing on each December 21st thereafter, the term of this Agreement shall renew for an additional year such that the remaining term of this Agreement is always three (3) years; provided, however, that in order for this Agreement to renew, the Joint Compensation Committee of the Board of Directors of the Bank and the Company (the “Committee”) must take the following actions prior to each  renewal date: (i)  conduct a comprehensive performance evaluation and review of Executive and present his evaluation to the full Company Board of Directors and Bank Board of Directors  (collectively the “Board”); and (ii) affirmatively approve the renewal or non-renewal of this Agreement, which decision shall be reported to the full Board  and included in the Board minutes. If the decision is not to renew this Agreement, then the Company and the Bank shall provide Executive with a written notice of non-renewal (“Non-Renewal Notice”) at least thirty (30) days and not more than sixty (60) days prior to any  renewal date, such that this Agreement shall terminate at the end of twenty four (24) months following such renewal date.

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Notwithstanding the foregoing, in the event that the Company or the Bank has entered into an agreement to effect a transaction which would be considered a Change in Control as defined herein, then the term of this Agreement shall be extended and shall terminate twenty four (24) months following the date on which the Change in Control occurs. The initial term and all renewals thereafter shall be referred to as the “Term” under this Agreement.
2. Position and Duties. At all times during the Term, the Executive shall (i) serve as President and Chief Executive Officer of the Company and the Bank and, in such capacity, shall perform such duties and have such responsibilities as is typical for such positions, as well as any other reasonable duties as may be assigned to him by the Board from time to time, and (ii) diligently and conscientiously devote substantially all of his business time, energy, and ability to his duties and the business of the Company and the Bank and will not engage in any other business, profession, or occupation for compensation or otherwise which would conflict or materially interfere with the performance of such services either directly or indirectly without the prior written consent of the  Board, and (iii) comply with all directions from the Board (other than directions that would require an illegal or unethical act or omission) and all applicable policies and regulations of the Company and the Bank. Executive shall report directly to the Board. Notwithstanding the foregoing, the Executive will be permitted to (a) with the prior written consent of the  Board (not to be unreasonably withheld), act or serve as a director, trustee, committee member, or principal of any type of business, civic or charitable organization as long as such activities are disclosed in writing to the Board, and (b) purchase or own less than two percent (2%) of the publicly traded securities of any entity which has the potential to be a competitor of the Company or the Bank or an unlimited ownership interest in any entity which is not similar to and does not have the potential to compete with the Company or the Bank; provided that, such ownership represents a passive investment and that the Executive is not a controlling person of, or a member of a group that controls, such entity; and provided further that, the activities described in clauses (a) and (b), in each case and in the aggregate, do not materially interfere with the performance of the Executive’s material duties and responsibilities as provided hereunder. The Executive has disclosed all such business, civic, and charitable organizations for which he serves as of the Effective Date, and it is hereby acknowledged that, as of the Effective Date, the same do not currently conflict with, and are not expected to interfere with, the Executive’s duties hereunder. The Executive is the most senior executive officer of the Company and the Bank. The Executive’s duties for the Company and the Bank include responsibility for managing the business, operations, and affairs of the Company and the Bank, including the implementation of strategic goals and objectives, subject to supervision and oversight by the Board or a committee of such Board authorized to act on such Board’s behalf. For purposes of this Agreement, all references to either the Company Board or the Bank Board shall be deemed to include references to all such committees. The Executive shall be responsible overall for the conduct of the business of the Company and the Bank. During the Term, the Executive shall serve as a member of the Company Board and the Bank Board and shall not receive any additional compensation for services as a member of such boards. Executive shall, if requested, also serve as an officer or director of any affiliate of the Company for no additional compensation.
3. Compensation, Benefits and Expenses. During the Term, the Bank shall compensate the Executive for his services as provided in this Section 3. Unless otherwise determined by the  Board, all payments and benefits provided in this Agreement shall be paid or provided solely by the Bank. Notwithstanding anything in this Agreement to the contrary, no provision of this Agreement shall be construed so as to result in the duplication of any payment or benefit. Unless otherwise determined by the  Board, the Company’s sole obligation under this Agreement shall be to unconditionally guarantee the payment and provision of all amounts and benefits due hereunder to Executive, and the affirmative obligations of the Company as set forth at Section 3(g), herein, with respect to Indemnification, and, if such amounts and benefits due from the Bank are not timely paid or provided by the Bank, such amounts and benefits shall be paid or provided by the Company.

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(a) Base Salary. The Bank shall pay the Executive an annual base salary at the rate of $425,000 payable in substantially equal installments in accordance with the Bank’s customary payroll practices regarding the payment of base salary to executives, but no less frequently than monthly (except to the extent the Executive has properly deferred such base salary pursuant to a Bank deferred compensation plan or arrangement, if any). The Executive’s base salary shall be reviewed at least annually by the Committee. The Committee may recommend that the Board increase, but not decrease the Executive’s base salary during the Term. In the absence of action by the Committee or the Board, the Executive shall continue to receive an annual base salary at the rate specified above on the Effective Date or, if another rate has been established under this Section 3(a), the rate last properly established by action of the Committee or the Board under this Section 3(a). The Executive’s annual base salary, as in effect from time to time, is hereinafter referred to as “Base Salary.”
(b) Annual Bonuses. For each completed fiscal year of the Bank (“Fiscal Year”) during the Term, the Executive shall have the opportunity to earn an annual cash bonus pursuant to the Everett Co-operative Bank Annual Incentive Plan or any successor plan thereto (the “AIP”), as the terms of the AIP may be revised from time to time, based on achievement of annual performance goals established by the Bank Board of Directors (“Bank Board”) in its discretion (an “Annual Bonus”) with a target amount determined annually by the Committee based on review of market data for similarly situated executives.
(c) Long-Term Equity Incentive Awards. If the Company or the Bank adopts an equity plan, the Executive shall be eligible for a long-term equity incentive award (“Equity Awards”). The  Committee shall determine the composition and size of the Executive’s Equity Awards granted during the Term, in its discretion. The Executive agrees and acknowledges that the actual value of any performance-based Equity Award will be based upon performance in relation to the performance goals used for the award. The terms and conditions of each Equity Award granted to the Executive shall be governed by the terms and conditions of the equity plan, as it may be amended or replaced from time to time, and the applicable award agreement evidencing the Equity Award.
(d) Employee Benefits. During the Term, the Executive will be eligible to participate in or receive benefits under all employee benefit plans, programs, arrangements and practices in which Executive was participating or otherwise deriving benefit immediately prior to the Effective Date, including but not limited to the Bank’s tax-qualified pension plan, tax-qualified 401(k) plan, supplemental executive retirement plan, medical plan, dental plan, vision plan, life insurance plan, short-term and long-term disability plans, fringe benefit arrangements, and executive perquisite arrangements (collectively, the “Benefit Plans”). During the Term, and to the extent consistent with applicable law, the Bank will not, without the Executive’s prior written consent, make any changes to any material Benefit Plan that would be materially adversely affect the Executive’s rights or benefits under such Benefit Plan, unless an equitable arrangement (embodied in an ongoing or substitute arrangement) is made with respect to such change. During the Term, the Executive also will be entitled to participate in or receive benefits under any employee benefit plan, program, arrangement or practice made available by the Company or the Bank in the future, subject to and on a basis consistent with the terms, conditions and overall administration of such plans and arrangements.

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(e) Paid Time Off. During the Term, the Executive shall be eligible for five (5) weeks of paid time off per calendar year in accordance with the Bank’s paid time off policies, as in effect from time to time.
(f) Business Expenses. The Executive shall be eligible for reimbursement of all reasonable and necessary out-of-pocket business, entertainment and travel expenses incurred by the Executive in connection with the performance of the Executive’s duties hereunder in accordance with the Bank’s expense reimbursement policies and procedures.
(g) Indemnification. The Bank and the Company shall provide the Executive (including his heirs, executors and administrators) with coverage under a standard directors’ and officers’ liability insurance policy at their expense and each such party shall indemnify the Executive (and his heirs, executors and administrators) to the fullest extent permitted under applicable law against all expenses and liabilities reasonably incurred by him in connection with or arising out of any action, suit or proceeding in which he may be involved by reason of his having been a director or officer of the Company or the Bank (whether or not he continues to be a director or officer at the time of incurring such expenses or liabilities), such expenses and liabilities to include, but not be limited to, judgments, court costs and attorneys’ fees and the costs of reasonable settlements.
(h) Automobile Allowance. Executive shall be entitled to receive a monthly automobile allowance (the “Auto Allowance”) in the amount of $1,000. The Auto Allowance is intended to offset Executive’s costs and expenses incurred in obtaining an automobile to be used for business purposes. Executive shall be liable for all costs and expenses incurred with respect to such automobile; provided, however, Executive shall be eligible for expense reimbursement in accordance with any policy respecting business use of personal automobiles maintained by the Employer from time to time.
4. Termination of Employment.
(a) Subject to its payment obligations under this Section and Sections 5 or 6, if applicable, the Company and the Bank may terminate the Executive’s employment with the Company and the Bank and this Agreement at any time, with or without Cause (as defined in subsection (b) below), by providing at least thirty (30) days prior written notice (with the exception of a termination for Cause, for which no prior written notice is required) setting forth the provision of the Agreement under which the Company and the Bank intend to terminate the Executive’s employment and that satisfies any additional specific notice provisions under such provision. The Executive may voluntarily terminate his employment with the Company and the Bank and this Agreement at any time, with or without Good Reason (as defined in subsection (c) below), by providing at least thirty (30) days prior written notice to the Company and the Bank setting forth the provision of the Agreement under which the Executive intends to terminate the Executive’s employment and that satisfies any additional specific notice provisions under such provision. Upon termination of the Executive’s employment and this Agreement during the Term, the Executive shall be entitled to the following in addition to any benefits payable under Sections 5 or 6, as applicable, and shall have no further rights to any compensation or any other benefits from the Company or the Bank or any other affiliate of the Company:

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(i) 
Any earned but unpaid Base Salary through the effective date of the Executive’s termination of employment with the Company and the Bank (the “Termination Date”), paid in accordance with Section 3(a).
(ii) 
Provided that the Executive applies for reimbursement in accordance with the Bank’s established reimbursement policies (within the period required by such policies but under no circumstances later than thirty (30) days after his Termination Date), the Bank shall pay the Executive any reimbursements to which he is entitled under such policies.
(iii) 
Any benefits (other than severance) payable to the Executive under any of the Bank’s incentive compensation or employee benefit plans or programs shall be payable in accordance with the provisions of those plans or programs.
Paragraphs 4(a)(i)-(iii) are herein referred to as the Executive’s “Accrued Obligations”.
In addition, Executive is entitled to all rights to indemnification and directors and officers liability insurance provided under Section 3(g).
Upon termination of the Executive’s employment hereunder for any reason, the Executive shall be deemed to have resigned from all positions that the Executive holds as an officer or member of the Board or of any other affiliate of the Company.
(b) For purposes of this Agreement, “Cause” means the occurrence of any of the following during the Term:
(i) 
material act of dishonesty or fraud in performing Executive’s duties on behalf of the Bank or the Company;
(ii) 
willful misconduct that in the judgment of the  Board will likely cause economic damage to the Bank or the Company or injury to the business reputation of the Bank or the Company;
(iii) 
incompetence (in determining incompetence, the acts or omissions shall be measured against standards generally prevailing in the savings institutions industry);
(iv) 
breach of fiduciary duty involving personal profit;
(v) 
intentional failure to perform stated duties under this Agreement after written notice thereof from the Board;

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(vi) 
willful violation of any law, rule or regulation (other than traffic violations or similar offenses which results only in a fine or other non-custodial penalty) that reflect adversely on the reputation of the Bank or the Company, any felony conviction, any violation of law involving moral turpitude, or any violation of a final cease-and-desist order; any material violation of the code of ethics or business conduct of the Bank or the Company, or
(vii) 
material breach by Executive of any provision of this Agreement.
Notwithstanding the foregoing, Executive shall not be deemed to have been terminated for Cause unless and until there shall have been delivered to Executive a notice of termination.
(c) For purposes of this Agreement, “Good Reason” means a termination by Executive, without Executive’s express written consent, if any of the following occurs:
(i) 
a material reduction in Executive’s base compensation, except for across-the-board reductions similarly affecting all or substantially all of the Bank’s executive officers;
(ii) 
a material reduction in Executive’s authority, duties or responsibilities;
(iii) 
a relocation of Executive’s principal place of employment by more than twenty (25) miles from the Bank’s main office location as of the date of this Agreement; or
(iv) 
any other action or inaction that constitutes a material breach of this Agreement by the Bank.
5. Non-Change of Control Severance Benefit.
(a) Subject to (i) the Executive’s timely execution and filing of a Release in accordance with Section 18, (ii) the expiration of any applicable waiting periods contained herein, and (iii) the following provisions of this Section 5, the Bank shall provide the Executive with the payments and benefits set forth in this Section 5 if, during the Term and before the occurrence of a Change of Control, either (1) the Company and the Bank terminate the Executive’s employment with the Company and the Bank and this Agreement other than pursuant to Section 8, or (2) the Executive terminates his employment with the Company and the Bank and this Agreement for Good Reason pursuant to Section 9. Notwithstanding the preceding provisions of this subsection (a), the Executive shall not be entitled to severance benefits pursuant to this Section 5 if he is entitled to severance benefits pursuant to Section 6. Any amount payable to the Executive pursuant to this Section 5 is in addition to his Accrued Obligations and is in consideration of the covenants set forth in this Agreement and/or the Release.
(b) The Bank shall pay to the Executive his Base Salary for the remaining Term. Base Salary will be paid in accordance with the Bank’s regular payroll practices, except that the first payment shall be made within 60 days following the Termination Date and shall include all installments that would have been paid earlier had the installment stream commenced immediately following the Termination Date.

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(c) The Bank will provide the Executive with continued coverage under the Bank’s health insurance plans (to the extent permitted by the plans and law) in which the Executive was participating as his Termination Date, until the earlier of 18 months following the Termination Date or the procurement by the Executive of health insurance coverage pursuant to another plan. In the event continued participation in the Bank’s health insurance plans is not permitted under plans or by law, the Executive will receive a lump sum cash payment equal to the total cost of Consolidated Omnibus Budget Reconciliation Act (COBRA) coverage for 18 months following the Termination Date.
(d) The treatment of any outstanding Equity Awards shall be determined in accordance with the terms of the applicable equity plan and the applicable award agreements evidencing such awards.
6. Change of Control Severance Benefit.
(a) Subject to (i) the expiration of any applicable waiting periods contained herein, and (ii) the following provisions of this Section 6, the Bank shall provide the Executive with the payments and benefits set forth in this Section 6, in lieu of severance payments or benefits under Section 5, if, during the Term and concurrent with or within twenty-four (24) months after a Change of Control (as defined in subsection (g) below), either (A) the Company and the Bank terminate the Executive’s employment with the Company and the Bank and this Agreement other than pursuant to Section 8, or (B) the Executive terminates his employment with the Company and the Bank and this Agreement for Good Reason pursuant to Section 9. Executive is also entitled to his Accrued Obligations as of his Termination Date.
(b) Within 60 days following the Termination Date, the Bank shall pay to the Executive a single lump sum payment in an amount equal to three (3) times the sum of: (i) the Executive’s annual Base Salary in effect as of his Termination Date and (ii) the average of the Executive’s cash bonus earned over the three (3) years immediately preceding the Change in Control. Years in which no bonus was earned shall not be included for purposes of calculating the average in this paragraph (b).
(c) The Bank shall continue the Executive’s participation in the Bank’s health insurance plans (to the extent permitted by the plans and law) in which the Executive was participating as of the Termination Date, until the earlier of 18 months following the Termination Date or the procurement by the Executive of health insurance coverage pursuant to another plan. In the event continued participation in the Bank’s health insurance plans is not permitted under plans or by law, the Executive will receive a lump sum cash payment equal to the total cost of Consolidated Omnibus Budget Reconciliation Act (COBRA) coverage for 18 months following the Termination Date.
(d) The Bank shall pay to the Executive any prior year Annual Bonus in a lump sum on the date on which the Annual Bonus would have been paid to the Executive but for Executive’s termination of employment; and

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(e) The treatment of any outstanding Equity Awards shall be determined in accordance with the terms of the applicable equity plan and the applicable award agreements evidencing such awards.
(f) If payments to the Executive pursuant to this Agreement would result in total parachute payments, whether or not made pursuant to this Agreement, the provisions of Section 7 shall apply as if set out in this Section 6.
(g) For purposes of this Agreement, “Change in Control” means a change in control of the Bank or Company, as defined in Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and the regulations promulgated thereunder, including the following:
(i) 
Change in ownership: A change in ownership of the Bank or the Company occurs on the date any one person or group of persons accumulates ownership of more than 50% of the total fair market value or total voting power of the Bank or the Company; or
(ii) 
Change in effective control: A change in effective control occurs when either (i) any one person or more than one person acting as a group acquires within a twelve (12)-month period ownership of stock of the Bank or Company possessing 35% or more of the total voting power of the Bank or Company; or (ii) a majority of the Bank’s or Company’s Board of Directors is replaced during any 12-month period by Directors whose appointment or election is not endorsed in advance by a majority of the Bank’s or Company’s Board of Directors (as applicable), or
(iii) 
Change in ownership of a substantial portion of assets: A change in the ownership of a substantial portion of the Bank’s or Company’s assets occurs if, in a twelve (12)-month period, any one person or more than one person acting as a group acquires assets from the Bank or Company having a total gross fair market value equal to or exceeding 40% of the total gross fair market value of the Bank’s or Company’s entire assets immediately before the acquisition or acquisitions. For this purpose, “gross fair market value” means the value of the Bank’s or Company’s assets, or the value of the assets being disposed of, determined without regard to any liabilities associated with the assets.
7. Excise Tax Limitation. In the event any payment or distribution of any type to or for the benefit of Executive made by the Bank or the Company, any person who acquires ownership or effective control of the Company or ownership of a substantial portion of the Company’s assets in connection with a “change in control” (within the meaning of Code Section 280G and the regulations thereunder) or any affiliate of such person, whether paid or payable or distributed or distributable pursuant to the terms of the Agreement or otherwise (the “Total Payments”), would otherwise exceed the amount that could be received by Executive without the imposition of an excise tax under Code Section 4999 (the “Safe Harbor Amount”), then the Total Payments shall be reduced to the extent, and only to the extent, necessary to assure that their aggregate present value, as determined in accordance with the applicable provisions of Code Section 280G and the regulations thereunder, does not exceed the greater of: (i) the Safe Harbor Amount, or (ii) the greatest after-tax amount payable to Executive after taking into account any excise tax imposed under Code Section 4999 on the Total Payments.

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8. Termination of Employment by the Company and the Bank for Cause,  Death or Disability.
(a) The Company and the Bank may initiate the termination of the Executive’s employment with the Company and the Bank and this Agreement for Cause at any time. Notwithstanding the foregoing, the Executive shall not be deemed to have been terminated for Cause unless and until there shall have been delivered to him a notice of termination which shall include a copy of a resolution duly adopted by the affirmative vote of not less than a simple majority of all of the members of the Company Board and Bank Board at a meeting of each such board called and held for that purpose, finding that in the good faith opinion of such board, Executive was guilty of conduct justifying termination for Cause and specifying the particulars thereof in detail. Executive shall not have the right to receive compensation or other benefits for any period after termination for Cause, except as provided in Section 4 of this Agreement.
(b) If the Executive dies before the termination of his employment with the Company and the Bank, his employment and this Agreement shall terminate automatically on the date of his death. In the case of a termination of the Executive’s employment with the Company and the Bank on account of death: (i) the Executive shall remain entitled to life insurance benefits pursuant to the Bank’s plans, programs, arrangements and practices in this regard, (ii) the Bank shall pay the Executive’s beneficiary his Accrued Obligations (if any), and (iii) the Executive shall not be entitled to severance benefits or payments pursuant to Sections 5 or 6.
(c) The Company and the Bank may initiate the termination of the Executive’s employment with the Company and the Bank and this Agreement for Disability at any time. In the case of a termination of the Executive’s employment with the Company and the Bank on account of Disability the Executive shall: (i) remain entitled to long-term disability benefits pursuant to terms and conditions of the Bank’s plans, programs, arrangements and practices in this regard, (ii) his Accrued Obligations (if any) and (iii) the Executive shall not be entitled to severance benefits or payments pursuant to Sections 5 or 6.
(d) For purposes of this Agreement, “Disability” will occur on the date on which the insurer or administrator of the Bank’s program of long-term disability insurance determines that the Executive is eligible to commence benefits under such insurance.
9. Resignation by Executive for Good Reason. If an event of Good Reason occurs during the Term, the Executive may, at any time within the ninety (90) day period following the initial occurrence of such event, provide the Bank Board with a written notice of termination specifying the event of Good Reason and notifying the Company and the Bank of his intention to terminate his employment with the Company and the Bank upon the Company’s and the Bank’s failure to correct the event of Good Reason within thirty (30) days following receipt of the Executive’s notice of termination. If the Company and the Bank fails to correct the event of Good Reason and provide the Executive with notice of such correction within such thirty (30) day period, the Executive’s employment with the Company and the Bank and this Agreement shall terminate as of the end of such period and the Executive shall be entitled to benefits as provided in Section 4 and Sections 5 or 6, as applicable.

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10. Withholding and Taxes. The Company and the Bank may withhold from any payment made hereunder (i) any taxes that the Company or the Bank reasonably determines are required to be withheld under federal, state, or local tax laws or regulations, and (ii) any other amounts that the Company or the Bank is authorized to withhold. Except for employment taxes that are the obligation of the Company or the Bank, the Executive shall pay all federal, state, local, and other taxes (including, without limitation, interest, fines, and penalties) imposed on him under applicable law by virtue of or relating to the payments and/or benefits contemplated by this Agreement, subject to any reimbursement provisions of this Agreement.
11. Use and Disclosure of Confidential Information.
(a) The Executive acknowledges and agrees that (i) by virtue of his employment with the Company and the Bank, he will be given access to, and will help analyze, formulate or otherwise use, Confidential Information, (ii) the Company and the Bank have devoted (and will devote) substantial time, money, and effort to develop Confidential Information and maintain the proprietary and confidential nature thereof, and (iii) Confidential Information is proprietary and confidential and, if any Confidential Information were disclosed or became known by persons engaging in a business in any way competitive with the Company’s Business, such disclosure would result in hardship, loss, irreparable injury, and damage to the Company or the Bank, the measurement of which would be difficult, if not impossible, to determine. Accordingly, the Executive agrees that (i) the preservation and protection of Confidential Information is an essential part of his duties of employment and that, as a result of his employment with the Company and the Bank, he has a duty of fidelity, loyalty, and trust to the Company and the Bank in safeguarding Confidential Information. The Executive further agrees that he will use his best efforts, exercise utmost diligence, and take all reasonable steps to protect and safeguard Confidential Information, whether such information derives from the Executive, other employees of the Company or the Bank, Customers, Prospective Customers, or vendors or suppliers of the Company of the Bank, and that he will not, directly or indirectly, use, disclose, distribute, or disseminate to any other person or entity or otherwise employ Confidential Information, either for his own benefit or for the benefit of another, except as required in the ordinary course of his employment by the Company and the Bank. The Executive shall follow all Company and Bank policies and procedures to protect all Confidential Information and shall take all reasonable precautions necessary under the circumstances to preserve and protect against the prohibited use or disclosure of any Confidential Information.
(b) For purposes of this Agreement, “Confidential Information” means the following:
(i) 
materials, records, documents, data, statistics, studies, plans, writings, and information (whether in handwritten, printed, digital, or electronic form) relating to the Company’s Business that are not generally known or available to the Company’s business, trade, or industry or to individuals who work therein other than through a breach of this Agreement, or
(ii) 
trade secrets of the Company or the Bank.

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Confidential Information also includes, but is not limited to: (1) information about Company or Bank employees; (2) information about the Company’s or the Bank’s compensation policies, structure, and implementation; (3) hardware, software, and computer programs and technology used by the Company or the Bank; (4) Customer and Prospective Customer identities, lists, and databases, including private information related to customer history, loan activity, account balances, and financial information; (5) strategic, operating, and marketing plans; (6) lists and databases and other information related to the Company’s or the Bank’s vendors; (7) policies, procedures, practices, and plans related to pricing of products and services; and (8) information related to the Company’s or the Bank’s acquisition and divestiture strategy. Information or documents that are generally available or accessible to the public shall be deemed Confidential Information, if the information is retrieved, gathered, assembled, or maintained by the Company or the Bank in a manner not available to the public or for a purpose beneficial to the Company or the Bank.
(c) For purposes of this Agreement, “Company’s Business” means, collectively, the products and services provided by the Company or the Bank or any other affiliate of the Company, including, but not limited to, lending activities (including individual loans consisting primarily of home equity lines of credit, residential real estate loans, and/or consumer loans, and commercial loans, including lines of credit, real estate loans, letters of credit, and lease financing) and depository activities (including noninterest-bearing demand, NOW, savings and money market, and time deposits), debit and ATM cards, merchant cash management, internet banking, treasury services, (including investment management, wholesale funding, interest rate risk, liquidity and leverage management and capital markets products) and other general banking services.
(d) For purposes of this Agreement, “Customer” means a person or entity who is a customer of the Company or the Bank at the time of the Executive’s termination of employment or with whom the Executive had direct contact on behalf of the Company or the Bank within the one year period preceding the termination of the Executive’s employment with the Company and the Bank
(e) For purposes of this Agreement, “Prospective Customer” means a person or entity who was the direct target of sales or marketing activity by the Executive or whom the Executive knew was a target of the Company’s or the Bank’s sales or marketing activities during the one year period preceding the termination of the Executive’s employment with the Company and the Bank.
(f) The confidentiality obligations contained in this Agreement shall continue as long as Confidential Information remains confidential (except that the obligations shall continue, if Confidential Information loses its confidential nature through improper use or disclosure, including but not limited to any breach of this Agreement and such use or disclosure is known to the Executive) and shall survive the termination of this Agreement and/or termination of the Executive’s employment with the Company and the Bank.
12. Nondisparagement. The Executive agrees not to make any oral or written statement or take any other action that disparages or criticizes the Company or the Bank or their management or practices, that damages the Company’s or the Bank’s good reputation, or that impairs the normal operations of the Company or the Bank. The Executive understands that this nondisparagement provision does not apply on occasions when the Executive is subpoenaed or ordered by a court or other governmental authority to testify or give evidence and must, of course, respond truthfully, to conduct otherwise protected by the Sarbanes-Oxley Act, or to conduct or testimony in the context of enforcing the terms of this Agreement or other rights, powers, privileges, or claims not released by this Agreement. The Executive also understands that the foregoing nondisparagement provision does not apply on occasions when the Executive provides truthful information in good faith to any federal, state, or local governmental body, agency, or official investigating an alleged violation of any antidiscrimination or other employment-related law or otherwise gathering information or evidence pursuant to any official investigation, hearing, trial, or proceeding. Nothing in this nondisparagement provision is intended in any way to intimidate, coerce, deter, persuade, or compensate the Executive with respect to providing, withholding, or restricting any communication whatsoever to the extent prohibited under 18 U.S.C. §§ 201, 1503, or 1512 or under any similar or related provision of state or federal law. In addition, nothing in this provision is intended to require the Executive to provide notice to the Company or the Bank or their attorneys before reporting any possible violations of federal law or regulation to any governmental agency or entity (“Whistleblower Disclosures”), and the Executive is not required to notify the Company or the Bank or their attorneys that the Executive has made any such Whistleblower Disclosures.

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13. Ownership of Documents and Return of Materials At Termination of Employment.
(a) Any and all documents, records, and copies thereof, including but not limited to hard copies or copies stored digitally or electronically, pertaining to or including Confidential Information (collectively, “Company Documents”) that are made or received by the Executive during his employment with the Company and the Bank shall be deemed to be property of the Company and the Bank. The Executive shall use Company Documents and information contained therein only in the course of his employment with the Company and the Bank and for no other purpose. The Executive shall not use or disclose any Company Documents to anyone except as authorized in the course of his employment and in furtherance of the Company’s Business.
(b) Upon termination of employment, the Executive shall deliver to the Company and the Bank, as soon as practicably possible (with or without request) all Company Documents and all other Company and Bank property in the Executive’s possession or under his custody or control.
14. Non-Solicitation of Customers and Employees. The Executive agrees that during the Term and for a period of one (1) year following the termination of the Executive’s employment with the Company and the Bank, the Executive shall not, directly or indirectly, individually or jointly, (i) solicit in any manner, seek to obtain or service, or accept the business of any Customer or any product or service of the type offered by the Company or the Bank or competitive with the Company’s Business, (ii) solicit in any manner, seek to obtain or service, or accept the business of any Prospective Customer for any product or service of the type offered by the Company or the Bank or otherwise competitive with the Company’s Business, (iii) request or advise any Customer, Prospective Customer, or supplier of the Company or the Bank to terminate, reduce, limit, or change its business or relationship with the Company or the Bank, or (iv) induce, request, or attempt to influence any employee of the Company or the Bank to terminate his employment with the Company or the Bank.
15. Covenant Not to Compete. The Executive hereby understands and acknowledges that, by virtue of his position with the Company and the Bank, he has obtained advantageous familiarity and personal contacts with Customers and Prospective Customers, wherever located, and the business, operations, and affairs of the Company and the Bank. Accordingly, except as set forth in subparagraph (b) of this Section 15, during the term of this

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Agreement and for a period of one (1) year following the termination of his employment with the Company and the Bank for any reason (“Restriction Period”), the Executive shall not, directly or indirectly:
(a) become an officer, employee, consultant, director, independent contractor, agent, joint venturer, partner or trustee of any savings bank, savings and loan association, savings and loan holding company, credit union, bank or bank holding company, insurance company or agency, any mortgage or loan broker or any other business that operates an insured depository institution that competes with the Bank or any affiliate of the Bank, that is: (i) headquartered within the twenty five (25) miles of the Bank’s headquarters, determined on the earlier of the date of occurrence of the event or Termination Date; or (ii) has one or more banking offices, but is not headquartered within twenty-five (25) miles of the Bank’s headquarters, but in the latter case, only if Executive would be employed to directly solicit business or have other direct solicitation responsibilities or solicitation duties within the area defined in subparagraphs (i) and (ii) and in either case, this Section 15(a) shall apply following Executive’s termination of employment only if Executive is entitled to receive the severance benefits described in Sections 5 and 6 of this Agreement.
16. Remedies. The Executive agrees that the Company and the Bank will suffer irreparable damage and injury and will not have an adequate remedy at law if the Executive breaches any provision of the restrictions contained in Sections 11, 12, 13, 14 and 15 (the “Restrictive Covenants”). Accordingly, if the Executive breaches or threatens or attempts to breach the Restrictive Covenants, in addition to all other available remedies, the Company and the Bank shall be entitled to seek injunctive relief, and no or minimal bond or other security shall be required in connection therewith. The Executive acknowledges and agrees that in the event of termination of this Agreement for any reason whatsoever, the Executive can obtain employment not competitive with the Company’s Business (or, if competitive, outside of the geographic and customer-specific scope described herein) and that the issuance of an injunction to enforce the provisions of the Restrictive Covenants shall not prevent the Executive from earning a livelihood. The Restrictive Covenants are essential terms and conditions to the Company entering into this Agreement, and they shall be construed as independent of any other provision in this Agreement or of any other agreement between the Executive and the Company or the Bank. The existence of any claim or cause of action that the Executive has against the Company or the Bank, whether predicated on this Agreement or otherwise, shall not constitute a defense to the enforcement by the Company or the Bank of the Restrictive Covenants.
17. Periods of Noncompliance and Reasonableness of Periods. The Company, the Bank and the Executive acknowledge and agree that the restrictions and covenants contained in Sections 14 and 15 are reasonable in view of the nature of the Company’s Business and the Executive’s advantageous knowledge of and familiarity with the Company’s Business, operations, affairs, and Customers. Notwithstanding anything contained herein to the contrary, if the scope of any restriction or covenant contained in Sections 14 and 15 is found by a court of competent jurisdiction to be too broad to permit enforcement of such restriction or covenant to its full extent, then such restriction or covenant shall be enforced to the maximum extent permitted by law. The parties hereby acknowledge and agree that a court of competent jurisdiction may reform or blue pencil the Agreement to the fullest extent permitted by law to enforce this Agreement.

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18. Release. For and in consideration of the foregoing covenants and promises made by the Company and the Bank, and the performance of such covenants and promises, the sufficiency of which is hereby acknowledged, the Executive understands that, as a condition of the payment of amounts under Section 5 of this Agreement, Executive will be required to execute a general release of all then existing claims against the Company, the Bank, their affiliates, shareholders, directors, officers, employees and agents in relation to claims relating to or arising out of the Executive’s employment with the Company and the Bank in a form substantially consistent with the Bank’s standard form of general release used for officers and not inconsistent with the terms of this Agreement (the “Release”), and the Executive shall not receive any payments or benefits to which he may be entitled hereunder that are subject to the execution of a Release unless the Executive satisfies this release requirement. THE EXECUTIVE’S RIGHT TO BENEFITS UNDER SECTION 5 OF THIS AGREEMENT SHALL BE CONTINGENT ON HIS SIGNING AND FILING THE RELEASE WITHIN THE PERIOD SPECIFIED IN THE RELEASE, WHICH PERIOD WILL NOT EXCEED 45 DAYS FROM THE DATE THE BANK PROVIDES THE RELEASE TO THE EXECUTIVE, AND NOT REVOKING THE RELEASE WITHIN THE PERIOD SPECIFIED IN THE RELEASE, WHICH PERIOD WILL NOT EXCEED 7 DAYS FROM THE DATE THE EXECUTIVE SIGNS THE RELEASE.
19. Cooperation. The parties agree that certain matters in which the Executive will be involved during the Term may necessitate the Executive’s cooperation in the future. Accordingly, following the termination of the Executive’s employment with the Company and the Bank for any reason, to the extent reasonably requested by the Company or the Bank and subject to the Executive’s professional commitments, the Executive shall cooperate with the Company and the Bank in connection with matters arising out of the Executive’s service to the Company and the Bank, such cooperation to include without limitation the providing of truthful testimony in any hearing or trial as requested by the Company or the Bank or any other affiliate of the Company; provided, however, that the Company and the Bank shall make reasonable efforts to minimize disruption of the Executive’s other activities. The Bank shall reimburse the Executive for reasonable expenses incurred or compensation not received by the Executive due to such cooperation.
20. Publicity. During the Term, the Executive hereby consents to any and all reasonable and customary uses and displays, by the Company, the Bank and their agents, representatives and licensees, of the Executive’s name, voice, likeness, image, appearance and biographical information in, on or in connection with any pictures, photographs, audio and video recordings, digital images, websites, television programs and advertising, other advertising and publicity, sales and marketing brochures, books, magazines, other publications, CDs, DVDs, tapes and all other printed and electronic forms and media throughout the world, at any time during the period of the Executive’s employment with the Company and the Bank, for all legitimate commercial and business purposes of the Company and the Bank, without royalty, payment or other compensation to Executive.
21. Reimbursement of Certain Costs.
(a) If the Company or the Bank brings a cause of action to enforce the Restrictive Covenants or to recover damages caused by the Executive’s breach of the Restrictive Covenants, the substantially prevailing party in such action shall be entitled to reasonable costs and expenses (including, without limitation, reasonable attorneys’ fees, expert witness fees, and disbursements) in connection with such action.

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(b) If a dispute arises regarding the Executive’s rights hereunder, and the Executive obtains a final judgment in his favor from a court of competent jurisdiction with respect to such dispute, all reasonable costs and expenses (including, without limitation, reasonable attorneys’ fees, expert witness fees, and disbursements) incurred by the Executive in connection with such dispute or in otherwise pursuing a claim based on a breach of this Agreement, shall be paid by the Bank.
22. No Reliance. The Executive represents and acknowledges that in executing this Agreement, the Executive does not rely and has not relied upon any representation or statement by the Company or the Bank or their agents, other than statements contained in this Agreement.
23. Required Provisions. Any payments made to the Executive pursuant to this Agreement, or otherwise, are subject to and conditioned upon their compliance with 12 U.S.C. §1828(k) and FDIC regulation 12 C.F.R. Part 359, Golden Parachute and Indemnification Payments.
24. Section 409A. To the extent necessary to ensure compliance with Code Section 409A (“Section 409A”), the provisions of this Section 24 shall govern in all cases over any contrary or conflicting provision in this Agreement.
(a) It is intended that this Agreement comply with the requirements of Section 409A and all guidance issued thereunder by the U.S. Internal Revenue Service with respect to any nonqualified deferred compensation subject to Section 409A. This Agreement shall be interpreted and administered to maximize the exemptions from Section 409A and, to the extent this Agreement provides for deferred compensation subject to Section 409A, to comply with Section 409A and to avoid the imposition of tax, interest and/or penalties upon Executive under Section 409A. The Company and the Bank do not, however, assume any economic burdens associated with Section 409A. Although the Company and the Bank intend to administer this Agreement to prevent taxation under Section 409A, they do not represent or warrant that this Agreement complies with any provision of federal, state, local, or non-United States law. The Company, the Bank, other affiliates of the Bank, and their respective directors, officers, employees and advisers will not be liable to the Executive (or any other individual claiming a benefit through the Executive) for any tax, interest, or penalties the Executive may owe as a result of this Agreement. Neither the Company, the Bank nor any other affiliate of the Company has any obligation to indemnify or otherwise protect the Executive from any obligation to pay taxes under Section 409A.
(b) The right to a series of payments under this Agreement will be treated as a right to a series of separate payments. Each payment under this Agreement that is made within 2-1⁄2 months following the end of the year that contains the Termination Date is intended to be exempt from

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Section 409A as a short-term deferral within the meaning of the final regulations under Section 409A. Each payment under this Agreement that is made later than 2-1⁄2 months following the end of the year that contains the Termination Date is intended to be exempt from Section 409A under the two-times exception of Treasury Reg. § 1.409A-1(b)(9)(iii), up to the limitation on the availability of that exception specified in the regulation. Then, each payment that is made after the two-times exception ceases to be available shall be subject to delay, as necessary, as specified below.
(c) To the extent necessary to comply with Section 409A, in no event may the Executive, directly or indirectly, designate the taxable year of payment. In particular, to the extent necessary to comply with Section 409A, if any payment to the Executive under this Agreement is conditioned upon the Executive executing and not revoking a release of claims and if the designated payment period for such payment begins in one taxable year and ends in the next taxable year, the payment will be made in the later taxable year.
(d) To the extent necessary to comply with Section 409A, references in this Agreement to “termination of employment” or “terminates employment” (and similar references) shall have the same meaning as “separation from service” under Section 409A(a)(2)(A)(i) and any governing Internal Revenue Service guidance and Treasury regulations (“Separation from Service”), and no payment subject to Section 409A that is payable upon a termination of employment shall be paid unless and until (and not later than applicable in compliance with Section 409A) the Executive incurs a Separation from Service. In addition, if the Executive is a “specified employee” within the meaning of Section 409A(a)(2)(B)(i) at the time of the Executive’s Separation from Service, any nonqualified deferred compensation subject to Section 409A that would otherwise have been payable on account of, and within the first six months following, the Executive’s Separation from Service, and not by reason of another event under
Section 409A(a)(2)(A), will become payable on the first business day after six months following the date of the Executive’s Separation from Service or, if earlier, the date of the Executive’s death.
(e) To the extent that any payment of or reimbursement by the Bank to the Executive of eligible expenses under this Agreement constitutes a “deferral of compensation” within the meaning of Section 409A (a “Reimbursement”) (i) the Executive must request the Reimbursement (with substantiation of the expense incurred) no later than 90 days following the date on which the Executive incurs the corresponding eligible expense; (ii) subject to any shorter time period provided in any Bank expense reimbursement policy or specifically provided otherwise in this Agreement, the Bank shall make the Reimbursement to the Executive on or before the last day of the calendar year following the calendar year in which the Executive incurred the eligible expense; (iii) the Executive’s right to Reimbursement shall not be subject to liquidation or exchange for another benefit; (iv) the amount eligible for Reimbursement in one calendar year shall not affect the amount eligible for Reimbursement in any other calendar year; and (v) except as specifically provided otherwise in this Agreement, the period during which the Executive may incur expenses that are eligible for Reimbursement is limited to five calendar years following the calendar year in which the Termination Date occurs.
25. Miscellaneous Provisions.
(a) Further Assurances. Each of the parties hereto shall do, execute, acknowledge, and deliver or cause to be done, executed, acknowledged, and delivered at any time and from time to time upon the request of any other party hereto, all such further acts, documents, and instruments as may be reasonably required to effect any of the transactions contemplated by this Agreement.

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(b) Binding Effect; Assignment. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns; provided, however, that neither party hereto may assign this Agreement without the prior written consent of the other party. Notwithstanding the foregoing, (i) the Company or the Bank, as applicable, shall require any successor or assign (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business or assets of the Company or the Bank, as applicable, to expressly assume, in writing, all of the Company’s or the Bank’s, as applicable, obligations to the Executive hereunder and the Executive hereby consents to the assignment of the Restrictive Covenants under this Agreement to any successor or assign of the Company or the Bank, as applicable, and (ii) upon the Executive’s death, this Agreement shall inure to the benefit of and be enforceable by the Executive’s executors, administrators, representatives, heirs, distributees, devisees, and legatees and all amounts payable hereunder shall be paid to such persons or the estate of the Executive.
(c) Waiver; Amendment. No provision or obligation of this Agreement may be waived or discharged unless such waiver or discharge is agreed to in writing and signed by a duly authorized officer of the Company and the Bank and the Executive. The waiver by any party hereto of a breach of or noncompliance with any provision of this Agreement shall not operate or be construed as a continuing waiver or a waiver of any other or later breach or noncompliance. Except as expressly provided otherwise herein, this Agreement may be amended or supplemented only by a written agreement executed by a duly authorized officer of the Company, a duly authorized officer of the Bank and the Executive.
(d) Headings. The headings in this Agreement have been inserted solely for ease of reference and shall not be considered in the interpretation or enforcement of this Agreement.
(e) Severability. Should any provision of this Agreement be held by a court of competent jurisdiction to be enforceable only if modified, or if any portion of this Agreement shall be held as unenforceable and thus stricken, such holding shall not affect the validity of the remainder of this Agreement, the balance of which shall continue to be binding upon the parties with any such modification to become a part hereof and treated as though originally set forth in this Agreement. The parties further agree that any such court is expressly authorized to modify any such unenforceable provision of this Agreement in lieu of severing such unenforceable provision from this Agreement in its entirety, whether by rewriting the offending provision, deleting any or all of the offending provision, adding additional language to this Agreement or by making such other modifications as it deems warranted to carry out the intent and agreement of the parties as embodied herein to the maximum extent permitted by law. The parties expressly agree that this Agreement as so modified by the court shall be binding upon and enforceable against each of them. In any event, should one or more of the provisions of this Agreement be held to be invalid, illegal, or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provisions hereof, and if such provision or provisions are not modified as provided above, this Agreement shall be construed as if such invalid, illegal, or unenforceable provisions had not been set forth herein.

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(f) Notice. Any notice, request, instruction, or other document to be given hereunder to any party shall be in writing and delivered by hand, registered or certified United States mail, return receipt requested, or other form of receipted delivery, with all expenses of delivery prepaid, at the address specified for such party below (or such other address as specified by such party by like notice):

 If to the Executive:
At the address maintained in the personnel records of the Bank.


If to the Executive:
Attn: Board of Directors of ECB Bancorp, Inc.
419 Broadway
Everett, MA 02149


If to the Bank:
Attn: Board of Directors of Everett Bank (same address as Company)
(g) Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which taken together shall constitute one and the same instrument.
(h) Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Massachusetts. Except as otherwise provided in Section 17 of this Agreement to the contrary, disputes or controversy arising under or in connection with this Agreement (unless prohibited by law) shall be settled exclusively by arbitration, conducted before a single arbitrator, mutually acceptable to Executive and the Bank, sitting in a location selected by the Bank within twenty-five (25) miles of the main office of the Bank in Everett, Massachusetts, in accordance with the rules of the American Arbitration Association’s National Rules for the Resolution of Employment Disputes then in effect. Judgment may be entered on the arbitrator’s award in any court having jurisdiction.
(i) Entire Agreement. This Agreement constitutes the entire and sole agreement between the Company and the Bank and the Executive with respect to the Executive’s employment with the Company and the Bank or the termination thereof, and there are no other agreements or understandings either written or oral with respect thereto. The parties agree that any and all prior severance and/or change of control agreements between the parties have been terminated and are of no further force or effect.
26. Review and Consultation. THE EXECUTIVE HEREBY ACKNOWLEDGES AND AGREES THAT HE (I) HAS READ THIS AGREEMENT IN ITS ENTIRETY PRIOR TO EXECUTING IT, (II) UNDERSTANDS THE PROVISIONS AND EFFECTS OF THIS AGREEMENT, (III) HAS CONSULTED WITH SUCH ADVISORS AS HE HAS DEEMED APPROPRIATE IN CONNECTION WITH HIS EXECUTION OF THIS AGREEMENT, AND (IV) HAS EXECUTED THIS AGREEMENT VOLUNTARILY. THE EXECUTIVE HEREBY UNDERSTANDS, ACKNOWLEDGES, AND AGREES THAT THIS AGREEMENT HAS BEEN PREPARED BY COUNSEL FOR THE COMPANY AND THE BANK AND THAT THE EXECUTIVE HAS NOT RECEIVED ANY ADVICE, COUNSEL, OR RECOMMENDATION WITH RESPECT TO THIS AGREEMENT FROM THE COMPANY OR THE BANK OR THEIR COUNSEL.

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27. Survival. Upon any expiration or other termination of this Agreement: (i) each of Sections 3(h) (Indemnification), 11 - 17 (Restrictive Covenants), 18 (Release), 19 (Cooperation), 23 (Required Provisions), 24 (Section 409A) and 26 (Review and Consultation) shall survive such expiration or other termination; and (ii) all of the other respective rights and obligations of the parties hereto shall survive such expiration or other termination to the extent necessary to carry out the intentions of the parties under this Agreement.
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IN WITNESS WHEREOF, each of the Company and the Bank has caused this Agreement to be executed by its duly authorized representative, and the Executive has signed this Agreement.

/s/Richard J. O’Neil, Jr.
Richard J. O’Neil, Jr.
Date: December 21, 2022

ECB BANCORP, INC.
By:  /s/ Dennis J. Leonard
Name:  Dennis J. Leonard
Title:  Chairman of the Board of Directors
Date:  December 21, 2022

EVERETT CO-OPERATIVE BANK:
By:  /s/ Dennis J. Leonard
Name:  Dennis J. Leonard
Title:  Chairman of the Board of Directors
Date:  December 21, 2022
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Exhibit 10.2
 

CHANGE IN CONTROL AGREEMENT

This AGREEMENT is made effective as of December 21, 2022 (“Effective Date”), by and between EVERETT CO-OPERATIVE BANK, a Massachusetts chartered stock savings bank (the “Bank”) and  JOHN CITRANO (“Executive”).  Any reference to the “Company” herein shall mean ECB BANCORP, INC. or any successor thereto.  The Company has executed this Agreement solely for purposes of guaranteeing the performance of the Bank hereunder.

BACKGROUND

A. To encourage the Executive’s dedication to his assigned duties in the face of potential distractions arising from the prospect of a “Change in Control” the Bank wishes to provide a payment to the Executive in the event the Executive’s employment is terminated involuntarily without “Cause” or voluntarily for “Good Reason” concurrent with or within twenty four (24) months after a Change in Control.

B. The Bank employs the Executive in a position of trust and confidence, and the Executive has or will become acquainted with the Bank’s business, its officers and employees, its strategic and operating plans, its business practices, processes, and relationships, the needs and expectations of its customers and prospective customers, and its trade secrets and other property, including Confidential Information as defined in herein.

NOW THEREFORE, in consideration of the mutual agreements herein contained, and upon the other terms and conditions hereinafter provided, the parties hereby agree as follows:

1. TERM OF AGREEMENT

(a)
The term of this Agreement shall commence as of the Effective Date and shall continue thereafter for a period of three (3)  years.

(b)
Commencing on December 21, 2023 and continuing on each December 21st  thereafter, the term of this Agreement shall renew for an additional year such that the remaining term of this Agreement is always three  (3) years provided, however, that in order for this Agreement to renew, the Compensation Committee of the Board of Directors of the Bank (the “Committee”) must take the following actions prior to each renewal date: (i) have the Chief Executive Officer of the Bank conduct a comprehensive performance evaluation and review of Executive and present his evaluation to the Committee for purposes of determining whether to extend this Agreement; and (ii) affirmatively approve the renewal or non-renewal of this Agreement, which decision shall be included in the Committee minutes. If the decision is not to renew this Agreement, then the Bank shall provide Executive with a written notice of non-renewal (“Non-Renewal Notice”) at least thirty (30) days and not more than sixty (60) days prior to any renewal date, such that this Agreement shall terminate at the end of twenty four (24) months following such renewal date.

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(c)
Notwithstanding the foregoing, in the event that the Company or the Bank has entered into an agreement to effect a transaction which would be considered a Change in Control as defined herein, then the term of this Agreement shall be extended and shall terminate twenty four (24) months following the date on which the Change in Control occurs. The initial term and all renewals thereafter shall be referred to as the “Term” under this Agreement.

2. DEFINITIONS The following words and terms shall have the meanings set forth below for purposes of this Agreement.

(a)
 Change in Control means a change in control of the Bank or Company, as defined in Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and the regulations promulgated thereunder, including the following:


(i)
Change in ownership: A change in ownership of the Bank or the Company occurs on the date any one person or group of persons accumulates ownership of more than 50% of the total fair market value or total voting power of the Bank or the Company;  or


(ii)
Change in effective control: A change in effective control occurs when either (i) any one person or more than one person acting as a group acquires within a twelve (12)-month period ownership of stock of the Bank or Company possessing 35% or more of the total voting power of the Bank or Company; or (ii) a majority of the Bank’s or Company’s Board of Directors is replaced during any 12-month period by Directors whose appointment or election is not endorsed in advance by a majority of the Bank’s or Company’s Board of Directors (as applicable), or


(iii)
Change in ownership of a substantial portion of assets: A change in the ownership of a substantial portion of the Bank’s or Company's assets occurs if, in a twelve (12)-month period, any one person or more than one person acting as a group acquires assets from the Bank or Company having a total gross fair market value equal to or exceeding 40% of the total gross fair market value of the Bank’s or Company’s entire assets immediately before the acquisition or acquisitions. For this purpose, “gross fair market value” means the value of the Bank’s or Company’s assets, or the value of the assets being disposed of, determined without regard to any liabilities associated with the assets.


(b)
Good Reason means a termination by Executive, without Executive’s express written consent, if any of the following occurs:


(i)
a material reduction in Executive’s base compensation, except for across-the-board reductions similarly affecting all or substantially all of the Bank’s executive officers;

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 (ii)
a material reduction in Executive’s authority, duties or responsibilities;


(iii)
a relocation of Executive’s principal place of employment by more than twenty (25) miles from the Bank’s main office location as of the date of this Agreement; or


(iv)
any other action or inaction that constitutes a material breach of this Agreement by the Bank.

Notwithstanding the foregoing, prior to any termination of employment for Good Reason, Executive must first provide written notice to the Board of Directors of the Bank (“Board”) within ninety (90) days following the initial existence of the condition, describing the existence of such condition, and the Bank shall thereafter have the right to remedy the condition within thirty (30) days of the date the Board received the written notice from Executive, but the Bank may waive its right to cure. If the Bank remedies the condition within such thirty (30) day cure period, then no Good Reason shall be deemed to exist with respect to such condition. If the Bank does not remedy the condition within such thirty (30) day cure period, then Executive may deliver a notice of termination for Good Reason at any time within sixty (60) days following the expiration of such cure period.


 (c)
Termination for Cause means termination because of, in the good faith determination of the Board, Executive’s:


(i)
material act of dishonesty or fraud in performing Executive’s duties on behalf of the Bank;


(ii)
willful misconduct that in the judgment of the Board will likely cause economic damage to the Bank or injury to the business reputation of the Bank;


(iii)
incompetence (in determining incompetence, the acts or omissions shall be measured against standards generally prevailing in the savings institutions industry);


(iv)
breach of fiduciary duty involving personal profit;


(v)
intentional failure to perform stated duties under this Agreement after written notice thereof from the Board;


(vi)
willful violation of any law, rule or regulation (other than traffic violations or similar offenses which results only in a fine or other non-custodial penalty) that reflect adversely on the reputation of the Bank, any felony conviction, any violation of law involving moral turpitude, or any violation of a final cease-and-desist order; any material violation of the code of ethics or business conduct of the Bank or the Company, or

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 (vii)
material breach by Executive of any provision of this Agreement.

Notwithstanding the foregoing, Executive shall not be deemed to have been terminated for Cause unless and until there shall have been delivered to Executive a Notice of Termination as described in Section 4 of this Agreement.


 (d)
Disability means any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months that renders the Executive unable to engage in any substantial gainful activity.


(e)
Separation from Service means the Executive’s termination of employment with the Bank within the meaning of Section 409A of the Internal Revenue Service and the Regulations promulgated thereunder.

3. BENEFITS UPON TERMINATION

(a)
If during the term of this Agreement, a Change of Control occurs and within twenty four (24) months following the Change of Control either the Executive’s employment is terminated for any reason other than for death, Disability, or Cause, or the Executive resigns for Good Reason within  twenty four (24) months following the Change of Control, the Executive shall be entitled to:

(i)
receive a lump sum cash severance payment equal to two and one-half (2.5) times the sum of: (A) Executive’s then current base salary and (B) the average of his cash bonus earned over the three (3) years immediately preceding the Change in Control. Years in which no bonus was earned shall not be included for purposes of calculating the average in this paragraph (a)(i);

(ii)
continue participation in the Bank's health insurance plans (to the extent permitted by the plan and law) in which the Executive was participating as his Date of Termination, until the earlier of 18 months following the Date of Termination or the procurement by the Executive of health insurance coverage pursuant to another plan. In the event continued participation in the Bank’s health insurance plans is not permitted under plans or by law, the Executive will receive a lump sum cash payment equal to the cost of  Consolidated Omnibus Budget Reconciliation Act (COBRA) coverage for 18 months following the Date of Termination; and

(iii)
his Accrued Obligations (as defined below).

Any payments to Executive under Section 3(a)(i) shall be made in a lump sum within ten (10) days following Executive’s termination of employment and reduced for applicable withholding taxes.  Executive shall not have the right to receive termination benefits pursuant to Section 3 hereof in the event of Executive’s termination for Cause or termination of employment due to Executive’s death or Disability.

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For purposes of this Agreement, “Accrued Obligations” are defined as: Executive’s earned but unpaid base salary and Executive’s earned but unpaid annual bonus and/or long term incentive compensation (cash and stock) as of his date of termination of employment.

(b)
In the event any payment or distribution of any type to or for the benefit of Executive made by the Bank, any person who acquires ownership or effective control of the Company or ownership of a substantial portion of the Company’s assets in connection with a “change in control” (within the meaning of Code Section 280G and the regulations thereunder) or any affiliate of such person, whether paid or payable or distributed or distributable pursuant to the terms of the Agreement or otherwise (the “Total Payments”), would otherwise exceed the amount that could be received by Executive without the imposition of an excise tax under Code Section 4999 (the “Safe Harbor Amount”), then the Total Payments shall be reduced to the extent, and only to the extent, necessary to assure that their aggregate present value, as determined in accordance with the applicable provisions of Code Section 280G and the regulations thereunder, does not exceed the greater of: (i) the Safe Harbor Amount, or (ii) the greatest after-tax amount payable to Executive after taking into account any excise tax imposed under Code Section 4999 on the Total Payments.

4.
NOTICE OF TERMINATION


(a)
Following a Change in Control, any termination of employment shall be communicated by Notice of Termination.  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.

(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 30 days from the date Notice of Termination is given.

5.
RESTRICTIVE COVENANTS


(a)
While Executive is employed by the Bank and for a period of 12 months after Executive’s employment with the Bank ends (regardless of the reason therefor) (the “Restricted Period”), Executive will not, without the express prior written consent of the Bank:
 
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(i) solicit, induce, or assist any third Person in soliciting or inducing any Person that is (or was at any time within the 12 months prior to the solicitation or inducement) an employee, consultant, independent contractor or agent of the Bank and/or any Affiliate to leave the employment of the Bank and/or any Affiliate or cease performing services as an independent contractor, consultant or agent of the Bank and/or any Affiliate; provided however that the placement of a general advertisement that is not directly targeted at any such Person or Persons shall not violate this clause (i);
 
(ii) hire, engage, or assist any third party in hiring or engaging, any individual that is or was (at any time within 12 months prior to the attempted hiring) an employee of the Bank and/or any Affiliate; or
 
(iii) other than for the benefit of the Bank and/or any Affiliate, solicit or interfere with the relationships of the Bank and/or any Affiliate with, or endeavor to entice away from the Bank and/or any Affiliate for a Competing Business, any Person that is or was (at any time within the 12-month period preceding the date that Executive’s employment with the Bank ends), a customer or “Prospective Customer” (as defined below) of the Bank; provided however that the placement of a general advertisement that is not directly targeted at any such Person or Persons shall not violate this clause (iii).  For purposes of this Agreement, the term “Customer” includes any person or entity who, during the 12-month period prior to the Executive’s termination with the Bank, is or was a customer of the Bank or an Affiliate. Notwithstanding the foregoing, the term “Customer” does not include any person who is a member of Executive’s immediate family, defined to include Executive’s spouse; his parents and his spouse's parents; his grandparents and his spouse's grandparents; Executive’s siblings and his spouse's siblings; Executive’s aunts and uncles and his spouse's aunts and uncles; Executive’s children and his spouse's children, including adoptive children; and the spouses and children, including adoptive children, of any of the above family members. A “Prospective Customer” is any Person with respect to whom or which the Bank and/or any Affiliate was engaged in solicitation at any time during the 12-month period preceding the date that Executive’s employment with the Bank ends and in which solicitation Executive was in any way involved or of which Executive otherwise had any knowledge or reasonably should have had any knowledge.

(b)
Unauthorized Disclosure and Confidential Information.  While employed by the Bank, and continuing after the date  the Executive’s employment is terminated for any reason, Executive shall not, directly or indirectly, use any Confidential Information (as hereinafter defined) other than pursuant to Executive’s employment by and for the benefit of the Bank, or disclose to anyone outside of the Bank any such Confidential Information.

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The term “Confidential Information” as used throughout this Agreement shall mean all trade secrets, proprietary information and other data or information (and any tangible evidence, record or representation thereof), whether prepared, conceived or developed by an employee of the Bank (including Employee) or received by The Bank from an outside source, which is in the possession of the Bank (whether or not the property of the Bank), which in any way relates to the business conducted or, to Executive’s knowledge, contemplated, by the Bank during the period of Executive’s  employment, which is maintained in confidence by the Bank or which might permit the Bank or its Customers to obtain a competitive advantage over competitors who do not have access to such trade secrets, proprietary information, or other data or information.  Without limiting the generality of the foregoing, Confidential Information shall include:
(i)
any idea, improvement, index, trading program, database, invention, innovation, development, technical data, design, formula, device, pattern, concept, computer program, software, firmware, source code, object code, algorithm, subroutine, object module, schematic, model, diagram, flow chart, manual, compilation of information, or work in process, or parts thereof, and any and all revisions and improvements relating to any of the foregoing (in each case whether or not reduced to tangible form); and
(ii)
the name of any Customer, Executive or consultant, marketing or sales material, plan or survey, business plan or opportunity, investment plan or strategy, business proposal, financial record, Customer record or business record or other record or information relating to the business conducted or, to Executive’s knowledge, contemplated, by the Bank during the period of Executive’s employment.
Notwithstanding the foregoing, the term Confidential Information shall not apply to information which the Bank has voluntarily disclosed to the public without restriction or which has otherwise lawfully entered the public domain, or which Executive can demonstrate was known to him prior to the start of his employment with the Bank through a source other than the Bank or any of its employees or affiliates.
Executive understands that the Bank from time to time has in its possession information (including computer programs and databases) which represent information which is claimed by others to be proprietary and which the Bank has agreed to keep confidential.  Executive agrees that all such information shall be Confidential Information for purposes of this Agreement.

(c)
Equitable Relief. Executive agrees that any breach of Executive’s obligations set forth in this Section 5 will cause irreparable damage to the Bank and in the event of such breach the Bank or its successor shall have, in addition to any and all remedies of law, the right to an injunction, specific performance or other equitable relief to prevent the violations of Executive’s obligations hereunder.

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(d)
Periods of Noncompliance and Reasonableness of Periods.  The Company, the Bank and the Executive acknowledge and agree that the restrictions and covenants contained in this Section 5 are reasonable in view of Executive’s advantageous knowledge of and familiarity with the business of the Bank and its Customers. Notwithstanding anything contained herein to the contrary, if the scope of any restriction or covenant contained in Section 5 is found by a court of competent jurisdiction to be too broad to permit enforcement of such restriction or covenant to its full extent, then such restriction or covenant shall be enforced to the maximum extent permitted by law. The parties hereby acknowledge and agree that a court of competent jurisdiction may reform or blue pencil the Agreement to the fullest extent permitted by law to enforce this Agreement.

(e)
 Definitions.   For purposes of this Section 5:
 
“Affiliate” means, with respect to any specified Person, any other Person that directly or indirectly, through one or more intermediaries, Controls, is Controlled by, or is under common Control with, such specified Person, provided that, in any event, any business in which the Bank has any direct ownership interest shall be treated as an Affiliate of the Bank.  For the avoidance of doubt, any holding company of the Bank shall be an Affiliate of the Bank.
 
“Control” (including, with correlative meanings, the terms “Controlled by” and “under common Control with”), as used with respect to any Person, means the direct or indirect possession of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by contract or otherwise.
 
“Person” means any individual, firm, corporation, partnership, limited liability company, trust, joint venture, association, governmental entity, unincorporated entity or other entity. 

6.
SOURCE OF PAYMENTS

It is intended by the parties hereto that all payments provided in this Agreement shall be paid in cash or check from the general funds of the Bank.  The Company, however, guarantees payment and provision of all amounts and benefits due hereunder to Executive and, if such amounts and benefits due from the Bank are not timely paid or provided by the Bank, such amounts and benefits shall be paid or provided by the Company.

7.
EFFECT ON PRIOR AGREEMENTS AND EXISTING BENEFIT PLANS

This Agreement contains the entire understanding between the parties hereto and supersedes any prior agreement (written or oral) between the Bank, Company and Executive.

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8.
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.

9.
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 or as to any act other than that specifically waived.

10.
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 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.

11.
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.

12.
GOVERNING LAW/DISPUTES

The validity, interpretation, performance, and enforcement of this Agreement shall be governed by the laws of the Commonwealth of Massachusetts, unless superseded or preempted by Federal law as now or hereafter in effect.

Except as set forth in Section 5 of this Agreement to the contrary, any dispute or controversy arising under or in connection with this Agreement (unless prohibited by law) shall be settled exclusively by arbitration, conducted before a single arbitrator, mutually acceptable to Executive and the Bank, sitting in a location selected by the Bank within twenty-five (25) miles of the main office of the Bank in Everett, Massachusetts, in accordance with the rules of the American Arbitration Association’s National Rules for the Resolution of Employment Disputes then in effect.  Judgment may be entered on the arbitrator’s award in any court having jurisdiction.

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13. REQUIRED PROVISION

In the event this Section 13 is in conflict with the other terms of this Agreement, this Section 13 shall prevail. Any payments made to the Executive pursuant to this Agreement, or otherwise, are subject to and conditioned upon their compliance with 12 U.S.C. §1828(k) and FDIC regulation 12 C.F.R. Part 359, Golden Parachute and Indemnification Payments.

14. SECTION 409A

To the extent necessary to ensure compliance with Code Section 409A (“Section 409A”), the provisions of this Section 14 shall govern in all cases over any contrary or conflicting provision in this Agreement.

(a)
It is intended that this Agreement comply with the requirements of Section 409A and all guidance issued thereunder by the U.S. Internal Revenue Service with respect to any nonqualified deferred compensation subject to Section 409A. This Agreement shall be interpreted and administered to maximize the exemptions from Section 409A and, to the extent this Agreement provides for deferred compensation subject to Section 409A, to comply with Section 409A and to avoid the imposition of tax, interest and/or penalties upon Executive under Section 409A. The Bank does not, however, assume any economic burdens associated with Section 409A. Although the Bank intends to administer this Agreement to prevent taxation under Section 409A, it does not represent or warrant that this Agreement complies with any provision of federal, state, local, or non-United States law. The Bank, any affiliates of the Bank, and their respective directors, officers, employees and advisers will not be liable to the Executive (or any other individual claiming a benefit through the Executive) for any tax, interest, or penalties the Executive may owe as a result of this Agreement. Neither the Bank nor any affiliate of the Bank has any obligation to indemnify or otherwise protect the Executive from any obligation to pay taxes under Section 409A.

(b)
The payment described in Section 3 above is intended to be exempt from Section 409A as either a short-term deferral within the meaning of the final regulations under Section 409A or under the two-times exception of Treasury Reg. §1.409A-1(b)(9)(iii).

(c)
To the extent necessary to comply with Section 409A, in no event may the Executive, directly or indirectly, designate the taxable year of payment.

(d)
To the extent necessary to comply with Section 409A, references in this Agreement to “termination of employment” or “terminates employment” (and similar references) shall have the same meaning as “separation from service” under Section 409A(a)(2)(A)(i) and any governing Internal Revenue Service guidance and Treasury regulations (“Separation from Service”), and no payment subject to Section 409A that is payable upon a termination of employment shall be paid unless and until (and not later than applicable in compliance with Section 409A) the Executive incurs a Separation from Service. In addition, if the Executive is a “specified employee” within the meaning of Section 409A(a)(2)(B)(i) at the time of the Executive’s Separation from Service, any nonqualified deferred compensation subject to Section 409A that would otherwise have been payable on account of, and within the first six months following, the Executive’s Separation from Service, and not by reason of another event under Section 409A(a)(2)(A), will become payable on the first business day after six months following the date of the Executive’s Separation from Service or, if earlier, the date of the Executive’s death.

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15.
SUCCESSOR TO THE BANK

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, 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.

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IN WITNESS WHEREOF, the Bank and the Company (as guarantor) have caused this Agreement to be executed by their duly authorized officers, and Executive has signed this Agreement, on this 21st day of December, 2022.

 
EVERETT CO-OPERATIVE BANK
   
   
By: 
/s/ Richard J. O’Neil, Jr.
 
Richard J. O’Neil, Jr.
President and Chief Executive Officer
   
   
 
ECB BANCORP, as guarantor
   
   
By: 
/s/ Richard J. O’Neil, Jr.
 
Richard J. O’Neil, Jr.
President and Chief Executive Officer
   
   
 
EXECUTIVE
   
   
By: 
/s/ John Citrano
 
John Citrano


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Exhibit 10.3
 
CHANGE IN CONTROL AGREEMENT

This AGREEMENT is made effective as of December 21, 2022 (“Effective Date”), by and between EVERETT CO-OPERATIVE BANK, a Massachusetts chartered stock savings bank (the “Bank”) and JOHN MIGLIOZZI (“Executive”).  Any reference to the “Company” herein shall mean ECB BANCORP, INC. or any successor thereto.  The Company has executed this Agreement solely for purposes of guaranteeing the performance of the Bank hereunder.

BACKGROUND

A. To encourage the Executive’s dedication to his assigned duties in the face of potential distractions arising from the prospect of a “Change in Control” the Bank wishes to provide a payment to the Executive in the event the Executive’s employment is terminated involuntarily without “Cause” or voluntarily for “Good Reason” concurrent with or within twenty four (24) months after a Change in Control.

B. The Bank employs the Executive in a position of trust and confidence, and the Executive has or will become acquainted with the Bank’s business, its officers and employees, its strategic and operating plans, its business practices, processes, and relationships, the needs and expectations of its customers and prospective customers, and its trade secrets and other property, including Confidential Information as defined in herein.

NOW THEREFORE, in consideration of the mutual agreements herein contained, and upon the other terms and conditions hereinafter provided, the parties hereby agree as follows:

1. TERM OF AGREEMENT

(a)
The term of this Agreement shall commence as of the Effective Date and shall continue thereafter for a period of two (2) years.

(b)
Commencing on December 21, 2023 and continuing on each December 21st  thereafter, the term of this Agreement shall renew for an additional year such that the remaining term of this Agreement is always two (2) years provided, however, that in order for this Agreement to renew, the Compensation Committee of the Board of Directors of the Bank (the “Committee”) must take the following actions prior to each renewal date: (i) have the Chief Executive Officer of the Bank conduct a comprehensive performance evaluation and review of Executive and present his evaluation to the Committee for purposes of determining whether to extend this Agreement; and (ii) affirmatively approve the renewal or non-renewal of this Agreement, which decision shall be included in the Committee minutes. If the decision is not to renew this Agreement, then the Bank shall provide Executive with a written notice of non-renewal (“Non-Renewal Notice”) at least thirty (30) days and not more than sixty (60) days prior to any renewal date, such that this Agreement shall terminate at the end of twenty four (24) months following such renewal date.

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(c)
Notwithstanding the foregoing, in the event that the Company or the Bank has entered into an agreement to effect a transaction which would be considered a Change in Control as defined herein, then the term of this Agreement shall be extended and shall terminate twenty four (24) months following the date on which the Change in Control occurs. The initial term and all renewals thereafter shall be referred to as the “Term” under this Agreement.

2. DEFINITIONS The following words and terms shall have the meanings set forth below for purposes of this Agreement.

(a)
Change in Control means a change in control of the Bank or Company, as defined in Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and the regulations promulgated thereunder, including the following:


(i)
Change in ownership: A change in ownership of the Bank or the Company occurs on the date any one person or group of persons accumulates ownership of more than 50% of the total fair market value or total voting power of the Bank or the Company;  or


(ii)
Change in effective control: A change in effective control occurs when either (i) any one person or more than one person acting as a group acquires within a twelve (12)-month period ownership of stock of the Bank or Company possessing 35% or more of the total voting power of the Bank or Company; or (ii) a majority of the Bank’s or Company’s Board of Directors is replaced during any 12-month period by Directors whose appointment or election is not endorsed in advance by a majority of the Bank’s or Company’s Board of Directors (as applicable), or


(iii)
Change in ownership of a substantial portion of assets: A change in the ownership of a substantial portion of the Bank’s or Company's assets occurs if, in a twelve (12)-month period, any one person or more than one person acting as a group acquires assets from the Bank or Company having a total gross fair market value equal to or exceeding 40% of the total gross fair market value of the Bank’s or Company’s entire assets immediately before the acquisition or acquisitions. For this purpose, “gross fair market value” means the value of the Bank’s or Company’s assets, or the value of the assets being disposed of, determined without regard to any liabilities associated with the assets.


(b)
Good Reason means a termination by Executive, without Executive’s express written consent, if any of the following occurs:


(i)
a material reduction in Executive’s base compensation, except for across-the-board reductions similarly affecting all or substantially all of the Bank’s executive officers;

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 (ii)
a material reduction in Executive’s authority, duties or responsibilities;


(iii)
a relocation of Executive’s principal place of employment by more than twenty (25) miles from the Bank’s main office location as of the date of this Agreement; or


(iv)
any other action or inaction that constitutes a material breach of this Agreement by the Bank.

Notwithstanding the foregoing, prior to any termination of employment for Good Reason, Executive must first provide written notice to the Board of Directors of the Bank (“Board”) within ninety (90) days following the initial existence of the condition, describing the existence of such condition, and the Bank shall thereafter have the right to remedy the condition within thirty (30) days of the date the Board received the written notice from Executive, but the Bank may waive its right to cure. If the Bank remedies the condition within such thirty (30) day cure period, then no Good Reason shall be deemed to exist with respect to such condition. If the Bank does not remedy the condition within such thirty (30) day cure period, then Executive may deliver a notice of termination for Good Reason at any time within sixty (60) days following the expiration of such cure period.


 (c)
Termination for Cause means termination because of, in the good faith determination of the Board, Executive’s:


(i)
material act of dishonesty or fraud in performing Executive’s duties on behalf of the Bank;


(ii)
willful misconduct that in the judgment of the Board will likely cause economic damage to the Bank or injury to the business reputation of the Bank;


(iii)
incompetence (in determining incompetence, the acts or omissions shall be measured against standards generally prevailing in the savings institutions industry);


(iv)
breach of fiduciary duty involving personal profit;


(v)
intentional failure to perform stated duties under this Agreement after written notice thereof from the Board;


(vi)
willful violation of any law, rule or regulation (other than traffic violations or similar offenses which results only in a fine or other non-custodial penalty) that reflect adversely on the reputation of the Bank, any felony conviction, any violation of law involving moral turpitude, or any violation of a final cease-and-desist order; any material violation of the code of ethics or business conduct of the Bank or the Company, or

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 (vii)
material breach by Executive of any provision of this Agreement.

Notwithstanding the foregoing, Executive shall not be deemed to have been terminated for Cause unless and until there shall have been delivered to Executive a Notice of Termination as described in Section 4 of this Agreement.


 (d)
Disability means any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months that renders the Executive unable to engage in any substantial gainful activity.


(e)
Separation from Service means the Executive’s termination of employment with the Bank within the meaning of Section 409A of the Internal Revenue Service and the Regulations promulgated thereunder.

3. BENEFITS UPON TERMINATION

(a)
If during the term of this Agreement, a Change of Control occurs and within twenty four (24) months following the Change of Control either the Executive’s employment is terminated for any reason other than for death, Disability, or Cause, or the Executive resigns for Good Reason within  twenty four (24) months following the Change of Control, the Executive shall be entitled to:

(i)
receive a lump sum cash severance payment equal to two (2) times the sum of: (A) Executive’s then current base salary and (B) the average of his cash bonus earned over the three (3) years immediately preceding the Change in Control. Years in which no bonus was earned shall not be included for purposes of calculating the average in this paragraph (a)(i);

(ii)
continue participation in the Bank's health insurance plans (to the extent permitted by the plan and law) in which the Executive was participating as his Date of Termination, until the earlier of 18 months following the Date of Termination or the procurement by the Executive of health insurance coverage pursuant to another plan. In the event continued participation in the Bank’s health insurance plans is not permitted under plans or by law, the Executive will receive a lump sum cash payment equal to the cost of  Consolidated Omnibus Budget Reconciliation Act (COBRA) coverage for 18 months following the Date of Termination; and

(iii)
his Accrued Obligations (as defined below).

Any payments to Executive under Section 3(a)(i) shall be made in a lump sum within ten (10) days following Executive’s termination of employment and reduced for applicable withholding taxes.  Executive shall not have the right to receive termination benefits pursuant to Section 3 hereof in the event of Executive’s termination for Cause or termination of employment due to Executive’s death or Disability.


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For purposes of this Agreement, “Accrued Obligations” are defined as: Executive’s earned but unpaid base salary and Executive’s earned but unpaid annual bonus and/or long term incentive compensation (cash and stock) as of his date of termination of employment.

(b)
In the event any payment or distribution of any type to or for the benefit of Executive made by the Bank, any person who acquires ownership or effective control of the Company or ownership of a substantial portion of the Company’s assets in connection with a “change in control” (within the meaning of Code Section 280G and the regulations thereunder) or any affiliate of such person, whether paid or payable or distributed or distributable pursuant to the terms of the Agreement or otherwise (the “Total Payments”), would otherwise exceed the amount that could be received by Executive without the imposition of an excise tax under Code Section 4999 (the “Safe Harbor Amount”), then the Total Payments shall be reduced to the extent, and only to the extent, necessary to assure that their aggregate present value, as determined in accordance with the applicable provisions of Code Section 280G and the regulations thereunder, does not exceed the greater of: (i) the Safe Harbor Amount, or (ii) the greatest after-tax amount payable to Executive after taking into account any excise tax imposed under Code Section 4999 on the Total Payments.

4.
NOTICE OF TERMINATION


(a)
Following a Change in Control, any termination of employment shall be communicated by Notice of Termination.  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.

(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 30 days from the date Notice of Termination is given.

5.
RESTRICTIVE COVENANTS


(a)
While Executive is employed by the Bank and for a period of 12 months after Executive’s employment with the Bank ends (regardless of the reason therefor) (the “Restricted Period”), Executive will not, without the express prior written consent of the Bank:

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 (i)
solicit, induce, or assist any third Person in soliciting or inducing any Person that is (or was at any time within the 12 months prior to the solicitation or inducement) an employee, consultant, independent contractor or agent of the Bank and/or any Affiliate to leave the employment of the Bank and/or any Affiliate or cease performing services as an independent contractor, consultant or agent of the Bank and/or any Affiliate; provided however that the placement of a general advertisement that is not directly targeted at any such Person or Persons shall not violate this clause (i);
 

 (ii)
hire, engage, or assist any third party in hiring or engaging, any individual that is or was (at any time within 12 months prior to the attempted hiring) an employee of the Bank and/or any Affiliate; or
 

 (iii)
other than for the benefit of the Bank and/or any Affiliate, solicit or interfere with the relationships of the Bank and/or any Affiliate with, or endeavor to entice away from the Bank and/or any Affiliate for a Competing Business, any Person that is or was (at any time within the 12-month period preceding the date that Executive’s employment with the Bank ends), a customer or “Prospective Customer” (as defined below) of the Bank; provided however that the placement of a general advertisement that is not directly targeted at any such Person or Persons shall not violate this clause (iii).  For purposes of this Agreement, the term “Customer” includes any person or entity who, during the 12-month period prior to the Executive’s termination with the Bank, is or was a customer of the Bank or an Affiliate. Notwithstanding the foregoing, the term “Customer” does not include any person who is a member of Executive’s immediate family, defined to include Executive’s spouse; his parents and his spouse's parents; his grandparents and his spouse's grandparents; Executive’s siblings and his spouse's siblings; Executive’s aunts and uncles and his spouse's aunts and uncles; Executive’s children and his spouse's children, including adoptive children; and the spouses and children, including adoptive children, of any of the above family members. A “Prospective Customer” is any Person with respect to whom or which the Bank and/or any Affiliate was engaged in solicitation at any time during the 12-month period preceding the date that Executive’s employment with the Bank ends and in which solicitation Executive was in any way involved or of which Executive otherwise had any knowledge or reasonably should have had any knowledge.

(b)
Unauthorized Disclosure and Confidential Information.  While employed by the Bank, and continuing after the date  the Executive’s employment is terminated for any reason, Executive shall not, directly or indirectly, use any Confidential Information (as hereinafter defined) other than pursuant to Executive’s employment by and for the benefit of the Bank, or disclose to anyone outside of the Bank any such Confidential Information.

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The term “Confidential Information” as used throughout this Agreement shall mean all trade secrets, proprietary information and other data or information (and any tangible evidence, record or representation thereof), whether prepared, conceived or developed by an employee of the Bank (including Employee) or received by The Bank from an outside source, which is in the possession of the Bank (whether or not the property of the Bank), which in any way relates to the business conducted or, to Executive’s knowledge, contemplated, by the Bank during the period of Executive’s  employment, which is maintained in confidence by the Bank or which might permit the Bank or its Customers to obtain a competitive advantage over competitors who do not have access to such trade secrets, proprietary information, or other data or information.  Without limiting the generality of the foregoing, Confidential Information shall include:
(i)
any idea, improvement, index, trading program, database, invention, innovation, development, technical data, design, formula, device, pattern, concept, computer program, software, firmware, source code, object code, algorithm, subroutine, object module, schematic, model, diagram, flow chart, manual, compilation of information, or work in process, or parts thereof, and any and all revisions and improvements relating to any of the foregoing (in each case whether or not reduced to tangible form); and
(ii)
the name of any Customer, Executive or consultant, marketing or sales material, plan or survey, business plan or opportunity, investment plan or strategy, business proposal, financial record, Customer record or business record or other record or information relating to the business conducted or, to Executive’s knowledge, contemplated, by the Bank during the period of Executive’s employment.
Notwithstanding the foregoing, the term Confidential Information shall not apply to information which the Bank has voluntarily disclosed to the public without restriction or which has otherwise lawfully entered the public domain, or which Executive can demonstrate was known to him prior to the start of his employment with the Bank through a source other than the Bank or any of its employees or affiliates.
Executive understands that the Bank from time to time has in its possession information (including computer programs and databases) which represent information which is claimed by others to be proprietary and which the Bank has agreed to keep confidential.  Executive agrees that all such information shall be Confidential Information for purposes of this Agreement.

(c)
Equitable Relief. Executive agrees that any breach of Executive’s obligations set forth in this Section 5 will cause irreparable damage to the Bank and in the event of such breach the Bank or its successor shall have, in addition to any and all remedies of law, the right to an injunction, specific performance or other equitable relief to prevent the violations of Executive’s obligations hereunder.

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(d)
Periods of Noncompliance and Reasonableness of Periods.  The Company, the Bank and the Executive acknowledge and agree that the restrictions and covenants contained in this Section 5 are reasonable in view of Executive’s advantageous knowledge of and familiarity with the business of the Bank and its Customers. Notwithstanding anything contained herein to the contrary, if the scope of any restriction or covenant contained in Section 5 is found by a court of competent jurisdiction to be too broad to permit enforcement of such restriction or covenant to its full extent, then such restriction or covenant shall be enforced to the maximum extent permitted by law. The parties hereby acknowledge and agree that a court of competent jurisdiction may reform or blue pencil the Agreement to the fullest extent permitted by law to enforce this Agreement.

(e)
 Definitions.   For purposes of this Section 5:
 
“Affiliate” means, with respect to any specified Person, any other Person that directly or indirectly, through one or more intermediaries, Controls, is Controlled by, or is under common Control with, such specified Person, provided that, in any event, any business in which the Bank has any direct ownership interest shall be treated as an Affiliate of the Bank.  For the avoidance of doubt, any holding company of the Bank shall be an Affiliate of the Bank.
 
“Control” (including, with correlative meanings, the terms “Controlled by” and “under common Control with”), as used with respect to any Person, means the direct or indirect possession of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by contract or otherwise.
 
“Person” means any individual, firm, corporation, partnership, limited liability company, trust, joint venture, association, governmental entity, unincorporated entity or other entity. 

(f)
In the event of any conflict between the provisions of this Section 5 and the Executive’s Confidentiality and Non-Solicitation Agreement by and between the Bank and the Executive dated as of January 2022 (“Restrictive Covenant Agreement”), the terms of the Restrictive Covenant Agreement shall control.
6.
SOURCE OF PAYMENTS

It is intended by the parties hereto that all payments provided in this Agreement shall be paid in cash or check from the general funds of the Bank.  The Company, however, guarantees payment and provision of all amounts and benefits due hereunder to Executive and, if such amounts and benefits due from the Bank are not timely paid or provided by the Bank, such amounts and benefits shall be paid or provided by the Company.

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7.
EFFECT ON PRIOR AGREEMENTS AND EXISTING BENEFIT PLANS

This Agreement contains the entire understanding between the parties hereto and supersedes any prior agreement (written or oral) between the Bank, Company and Executive.

8.
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.

9.
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 or as to any act other than that specifically waived.

10.
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 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.

11.
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.



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12.
GOVERNING LAW/DISPUTES

The validity, interpretation, performance, and enforcement of this Agreement shall be governed by the laws of the Commonwealth of Massachusetts, unless superseded or preempted by Federal law as now or hereafter in effect.

Except as set forth in Section 5 of this Agreement to the contrary, any dispute or controversy arising under or in connection with this Agreement (unless prohibited by law) shall be settled exclusively by arbitration, conducted before a single arbitrator, mutually acceptable to Executive and the Bank, sitting in a location selected by the Bank within twenty-five (25) miles of the main office of the Bank in Everett, Massachusetts, in accordance with the rules of the American Arbitration Association’s National Rules for the Resolution of Employment Disputes then in effect.  Judgment may be entered on the arbitrator’s award in any court having jurisdiction.

13. REQUIRED PROVISION

In the event this Section 13 is in conflict with the other terms of this Agreement, this Section 13 shall prevail. Any payments made to the Executive pursuant to this Agreement, or otherwise, are subject to and conditioned upon their compliance with 12 U.S.C. §1828(k) and FDIC regulation 12 C.F.R. Part 359, Golden Parachute and Indemnification Payments.

14. SECTION 409A

To the extent necessary to ensure compliance with Code Section 409A (“Section 409A”), the provisions of this Section 14 shall govern in all cases over any contrary or conflicting provision in this Agreement.

(a)
It is intended that this Agreement comply with the requirements of Section 409A and all guidance issued thereunder by the U.S. Internal Revenue Service with respect to any nonqualified deferred compensation subject to Section 409A. This Agreement shall be interpreted and administered to maximize the exemptions from Section 409A and, to the extent this Agreement provides for deferred compensation subject to Section 409A, to comply with Section 409A and to avoid the imposition of tax, interest and/or penalties upon Executive under Section 409A. The Bank does not, however, assume any economic burdens associated with Section 409A. Although the Bank intends to administer this Agreement to prevent taxation under Section 409A, it does not represent or warrant that this Agreement complies with any provision of federal, state, local, or non-United States law. The Bank, any affiliates of the Bank, and their respective directors, officers, employees and advisers will not be liable to the Executive (or any other individual claiming a benefit through the Executive) for any tax, interest, or penalties the Executive may owe as a result of this Agreement. Neither the Bank nor any affiliate of the Bank has any obligation to indemnify or otherwise protect the Executive from any obligation to pay taxes under Section 409A.

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(b)
The payment described in Section 3 above is intended to be exempt from Section 409A as either a short-term deferral within the meaning of the final regulations under Section 409A or under the two-times exception of Treasury Reg. §1.409A-1(b)(9)(iii).

(c)
To the extent necessary to comply with Section 409A, in no event may the Executive, directly or indirectly, designate the taxable year of payment.

(d)
To the extent necessary to comply with Section 409A, references in this Agreement to “termination of employment” or “terminates employment” (and similar references) shall have the same meaning as “separation from service” under Section 409A(a)(2)(A)(i) and any governing Internal Revenue Service guidance and Treasury regulations (“Separation from Service”), and no payment subject to Section 409A that is payable upon a termination of employment shall be paid unless and until (and not later than applicable in compliance with Section 409A) the Executive incurs a Separation from Service. In addition, if the Executive is a “specified employee” within the meaning of Section 409A(a)(2)(B)(i) at the time of the Executive’s Separation from Service, any nonqualified deferred compensation subject to Section 409A that would otherwise have been payable on account of, and within the first six months following, the Executive’s Separation from Service, and not by reason of another event under Section 409A(a)(2)(A), will become payable on the first business day after six months following the date of the Executive’s Separation from Service or, if earlier, the date of the Executive’s death.

15.
SUCCESSOR TO THE BANK

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, 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.

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IN WITNESS WHEREOF, the Bank and the Company (as guarantor) have caused this Agreement to be executed by their duly authorized officers, and Executive has signed this Agreement, on this 21st day of December, 2022.

 
EVERETT CO-OPERATIVE BANK
   
   
By: 
/s/ Richard J. O’Neil, Jr.
 
Richard J. O’Neil, Jr.
President and Chief Executive Officer
   
   
 
ECB BANCORP, as guarantor
   
   
By:  
/s/ Richard J. O’Neil, Jr.
 
Richard J. O’Neil, Jr.
President and Chief Executive Officer
   
   
 
EXECUTIVE
   
   
By: 
/s/ John Migliozzi
 
John Migliozzi

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Exhibit 10.4
 
CONFIDENTIALITY AND NON-SOLICITATION AGREEMENT

CONFIDENTIALITY AND NON-SOLICITATION AGREEMENT (the “Agreement”), dated as of January 3, 2022 by and between EVERETT CO-OPERATIVE BANK, a Massachusetts chartered savings bank (the “Bank”) and JOHN MIGLIOZZI (“Executive”).

WHEREAS, the Executive has accepted employment with the Bank as its Chief Lending Officer; and

WHEREAS, given the senior executive position Executive will hold with the Bank, a condition of the Bank’s offer of employment and the benefits provided thereunder, the Executive agreed to enter into this Agreement and abide by the restrictive covenants set forth herein; and

WHEREAS, Executive has reviewed this Agreement with his legal counsel and desires to enter into this Agreement;

NOW, THEREFORE, as a condition of employment with the Bank and in consideration of the benefits provided to the Executive in connection with his offer of employment with the Bank, the parties hereby agree as follows:

1. 
Confidentiality. For purposes of this Agreement, “Confidential Information” shall include, but shall not be limited to: financial information or plans; sales and marketing information or plans; business or strategic plans; salary, bonus, or other personnel information of any type; information concerning methods of operation; proprietary systems or software; legal or regulatory information; cost and pricing information or policies; information concerning new or potential products or markets; investment models, practices, procedures, strategies, or related information; research and/or analysis; and information concerning Customers or Prospective Customers. Confidential Information shall not include information falling within the description of Confidential Information that already is available to the public through no unauthorized act of Executive and salary, bonus, or other personnel information specific to Executive, nor should the paragraph be construed so as to interfere with Executive’s right to use his general knowledge, experience, memory, and skills, whenever or wherever acquired, in any future employment. For purposes of this Agreement, the terms “includes”, “including” and similar variations thereof are intended to be illustrative, and any illustrative items that follow any such terms shall not be limited to such illustrative items.

Executive agrees that:

(a) 
While working for the Bank or an Affiliate, Executive may develop, acquire, have access to and/or otherwise have knowledge of Confidential Information.

(b) 
Confidential Information is and will continue to be the sole and exclusive property of the Bank and/or its Affiliates.

(c) 
Executive will use Confidential Information only in the performance of Executive’s duties for the Bank an Affiliate. Executive will not use Confidential Information at any time (during or after Executive’s employment with the Bank) for Executive’s personal benefit, for the benefit of any Person (as defined below) other than the Bank and/or an Affiliate, or in any manner adverse to the interests of the Bank, an Affiliate or Bank customers.

(d) 
Executive will not disclose Confidential Information at any time (during or after Executive’s employment with the Bank) except (x) as such disclosure may be required or appropriate in connection with Executive’s service to the Bank, or (y) when required to do so by a court of law, by any governmental agency or by any administrative or legislative body (including a committee thereof) with apparent jurisdiction to order Executive to divulge, disclose or make accessible such information. Executive agrees to provide the Bank written notice ten (10) days prior to any disclosure pursuant to clause (y) of the preceding sentence and to cooperate with any efforts by the Bank to limit the extent of such disclosure. Notwithstanding the foregoing or anything else contained herein to the contrary, this Agreement shall not preclude Executive from disclosing Confidential Information to a governmental body or agency or to a court if and to the extent that a restriction on such disclosure would limit the Executive from exercising any protected right afforded the Executive under applicable law.

(e) 
Executive will safeguard Confidential Information by all reasonable steps and abide by all policies and procedures of the Bank in effect from time to time regarding storage, copying, destroying, publication or posting, or handling of such Confidential Information, in whatever medium or format that Confidential Information takes.

(f) 
Executive will execute and abide by all confidentiality agreements that the Bank reasonably requests Executive to sign or abide by, whether those agreements are for the benefit of the Bank its Affiliates or a customer thereof.

(g) 
When Executive’s employment relationship with the Bank ends, Executive will immediately return to the Bank all materials containing and/or relating to Confidential Information and, except as the Bank may, in its sole discretion, expressly permit in writing, all equipment provided to Executive by the Bank during Executive’s employment, including without limitation all computers, laptops, cellular telephones, printers, facsimile machines and scanners. Executive shall not retain any copies or reproductions of correspondence, memoranda, reports, notebooks, photographs, databases, diskettes, or other documents or electronically stored information of any kind relating in any way to the business, potential business or affairs of the Bank and/or its Affiliates.

Executive acknowledges receipt of the following notice under the Defend Trade Secrets Act: An individual will not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret if he/she (i) makes such disclosure in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney and such disclosure is made solely for the purpose of reporting or investigating a suspected violation of law; or (ii) such disclosure was made in a complaint or other document filed in a lawsuit or other proceeding if such filing is made under seal.


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2. 
Access Codes; Passwords. Executive shall provide all access codes, passcodes, and administrator rights to any account opened by the Executive on behalf of the Bank to the Chief Executive Officer of the Bank at any time during or after Executive’s employment on demand.

3. 
Non-Solicitation. While Executive is employed by the Bank and for a period of 12 months after Executive’s employment with the Bank ends (regardless of the reason therefor) (the “Restricted Period”), Executive will not, without the express prior written consent of the Bank:

(i) 
solicit, induce, or assist any third Person in soliciting or inducing any Person that is (or was at any time within the 12 months prior to the solicitation or inducement) an employee, consultant, independent contractor or agent of the Bank and/or any Affiliate to leave the employment of the Bank and/or any Affiliate or cease performing services as an independent contractor, consultant or agent of the Bank and/or any Affiliate; provided however that the placement of a general advertisement that is not directly targeted at any such Person or Persons shall not violate this clause (i);

(ii) 
hire, engage, or assist any third party in hiring or engaging, any individual that is or was (at any time within 12 months prior to the attempted hiring) an employee of the Bank and/or any Affiliate; or

(iii) 
other than for the benefit of the Bank and/or any Affiliate, solicit or interfere with the relationships of the Bank and/or any Affiliate with, or endeavor to entice away from the Bank and/or any Affiliate for a Competing Business, any Person that is or was (at any time within the 12-month period preceding the date that Executive’s employment with the Bank ends), a customer or "Prospective Customer" (as defined below) of the Bank; provided however that the placement of a general advertisement that is not directly targeted at any such Person or Persons shall not violate this clause (iii). For purposes of this Agreement, the term “Customer” includes any person or entity who, during the 12-month period prior to the Executive’s termination with the Bank, is or was a customer of the Bank or an Affiliate. Notwithstanding the foregoing, the term “Customer” does not include any person who is a member of Executive’s immediate family, defined to include Executive’s spouse; his parents and his spouse's parents; his grandparents and his spouse’s grandparents; Executive’s siblings and his spouse’s siblings; Executive’s aunts and uncles and his spouse’s aunts and uncles; Executive’s children and his spouse’s children, including adoptive children; and the spouses and children, including adoptive children, of any of the above family members. A “Prospective Customer” is any Person with respect to whom or which the Bank and/or any Affiliate was engaged in solicitation at any time during the 12-month period preceding the date that Executive’s employment with the Bank ends and in which solicitation Executive was in any way involved or of which Executive otherwise had any knowledge or reasonably should have had any knowledge.

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For purposes of this Agreement:

"Affiliate" means, with respect to any specified Person, any other Person that directly or indirectly, through one or more intermediaries, Controls, is Controlled by, or is under common Control with, such specified Person, provided that, in any event, any
business in which the Bank has any direct ownership interest shall be treated as an Affiliate of the Bank. For the avoidance of doubt, any holding company of the Bank shall be an Affiliate of the Bank.
"Control" (including, with correlative meanings, the terms "Controlled by" and "under common Control with"), as used with respect to any Person, means the direct or indirect possession of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by contract or otherwise.

"Person" means any individual, firm, corporation, partnership, limited liability company, trust, joint venture, association, governmental entity, unincorporated entity or other entity.

4.
Remedies Upon Breach.

(a) 
Executive agrees that the restrictions contained in Sections 1, 2, and 3 of this Agreement are necessary and appropriate to protect the business and goodwill of the Bank and its Affiliates, and Executive considers them reasonable for such purpose. Executive agrees that the restrictions contained in this Agreement will not prevent Executive from obtaining gainful employment should Executive’s employment with the Bank end. Executive agrees that in any action seeking specific performance or other equitable relief, Executive will not assert or contend that any of the provisions of this Agreement are unreasonable or otherwise unenforceable.

(b) 
Executive further agrees that in the event of Executive’s breach or threatened breach of any of the provisions of Sections 1, 2 and 3 of this Agreement, the Bank would suffer substantial irreparable harm and would not have an adequate remedy at law for such breach. In recognition of the foregoing, Executive agrees that in the event of a breach or threatened breach of any of those provisions, in addition to such other remedies that the Bank may have at law, without posting any bond or security, the Bank shall be entitled to seek and obtain equitable relief, in the form of specific performance, or temporary, preliminary or permanent injunctive relief, or any other equitable remedy which then may be available, as well as attorneys’ fees and costs and an equitable accounting of all earnings, profits and other benefits arising, directly or indirectly, from such breach. The seeking of such injunction or order shall not affect the right of the Bank to seek and obtain damages or other equitable relief on account of any such actual or threatened breach.

5. 
Post-Employment Cooperation. Executive agrees that, during Executive’s employment, and for a period of two (2) years after Executive’s employment with the Bank ends (regardless of the reason therefor), upon reasonable request from the Bank, and after Executive’s employment ends, subject to Executive’s other business commitments, Executive will cooperate with the Bank in the defense of any claims or actions that may be made by or against the Bank that relate to the period of Executive’s employment with the Bank. The Bank agrees, to the extent permitted by applicable law, regulation and/or court rules, to reimburse Executive for Executive’s reasonable travel and other direct expenses incurred by Executive in extending such cooperation, so long as Executive provides advance written notice of the request for reimbursement and provides satisfactory documentation of the expenses to comply with Executive’s obligations under this Section 5.

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6. 
Prior Agreements. Executive represents that except as Executive has fully disclosed previously in writing to the Bank, Executive is not bound by the terms of any agreement with any previous employer or other party to refrain from using or disclosing any trade secret or confidential or proprietary information in the course of Executive’s employment with the Bank or to refrain from competing, directly or indirectly, with the business of such previous employer or any other party. Executive further represents that Executive’s performance of all the terms of this Agreement as an employee of the Bank does not and will not breach any agreement to keep in confidence proprietary information, knowledge or data acquired by Executive in confidence or in trust prior to Executive’s employment with the Bank. Executive will not disclose to the Bank or induce the Bank to use any confidential or proprietary information or material belonging to any previous employer or others.
 
7. 
Survival and Assignment. Executive understands that Executive’s obligations under this Agreement will continue in accordance with its express terms regardless of any changes in Executive’s title, position, duties, salary, compensation or benefits or other terms and conditions of employment. Executive further understands that Executive’s obligations under this Agreement will continue following the termination of Executive’s employment regardless of the manner of such termination and will be binding upon Executive’s heirs, executors and administrators. Executive understands and agrees that the Bank has the right to assign this Agreement to its successors and assigns.

8. 
Disclosure to Future Employers. During the Restricted Period (as defined in Section 3), Executive will provide a copy of this Agreement to any prospective employer, partner or co- venturer prior to entering into an employment, partnership or other business relationship with such person or entity.

9. 
Governing Law. The Parties agree that this Agreement shall be governed in all respects by the law of the Commonwealth of Massachusetts, without regard to that state’s choice of law provisions.

10. 
Severability. In the event that any court of competent jurisdiction shall determine that any one or more of the provisions contained in this Agreement shall be unenforceable in any respect, then such provision shall be deemed limited and restricted to the extent that the court shall deem the provision to be enforceable. This Agreement is to be given the broadest interpretation permitted by law. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision hereof. The covenants and restrictions contained in this Agreement shall be deemed a series of separate covenants and restrictions. If, in any judicial proceeding, a court of competent jurisdiction should refuse to enforce all of the separate covenants and restrictions in this Agreement, then such unenforceable covenants and restrictions shall be deemed eliminated from the provisions of this Agreement for the purpose of such proceeding to the extent necessary to permit the remaining separate covenants and restrictions to be enforced in such proceeding.

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11. 
Entire Agreement. This Agreement shall constitute the entire agreement among the parties with respect to the matters covered hereby and shall supersede all previous written, oral or implied understandings among them with respect to such matters.

12. 
Amendment. No provisions of this Agreement may be amended, modified, or waived unless such amendment or modification is agreed to in writing signed by Executive and by a duly authorized officer of the Bank, and such waiver is set forth in writing and signed by the party to be charged. No waiver by either party hereto at any time of any breach by the other party hereto of any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time.

13. 
Notice. For the purposes of this Agreement, any notice required or permitted to be given under this Agreement shall be deemed properly given if in writing and if mailed by registered or certified U.S. mail, postage prepaid with return receipt requested, and by regular U.S. mail, postage prepaid, to Executive’s address, in the case of notices to Executive, and to the principal executive office of the Bank, in the case of notice to the Bank.

14. 
Section Headings. The section headings in this Agreement are for convenience of reference only, and they form no part of this Agreement and shall not affect its interpretation.

15. 
Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument.

16. 
Review. Executive represents and warrants that: (i) Executive has read this Agreement and understands all the terms and conditions hereof; (ii) Executive has entered into this Agreement of Executive’s own free will and volition; (iii) Executive has been advised by the Bank that this Agreement is a legally binding contract and that Executive should seek Executive’s own independent attorney to review it; (iv) Executive has been afforded ample opportunity to consult with Executive’s own attorney regarding this Agreement; and (v) the terms of this Agreement are fair, reasonable and are being agreed to voluntarily in exchange for Executive’s employment by the Bank.












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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

 
EVERETT CO-OPERATIVE BANK
   
   
By: 
/s/ Richard J. O’Neil, Jr.
 
Richard J. O’Neil, Jr.
President and Chief Executive Officer
   
   
 
EXECUTIVE
   
   
By:
/s/ John Migliozzi
 
John Migliozzi




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