SEPARATION AGREEMENT AND GENERAL RELEASE
EXHIBIT 10.1
SEPARATION AGREEMENT AND GENERAL RELEASE
This Separation Agreement and General Release (“Agreement”) is between Beneficial Mutual
Bancorp, Inc., a federally chartered corporation (the “Company”), and Beneficial Mutual Savings
Bank, a Pennsylvania chartered savings bank (the “Bank”) (the Bank and the Company are hereinafter
referred to collectively as “Employer”), and Xxxxxx X. Xxxxxx (“Employee”).
WHEREAS, Employee has been informed that, regardless of whether he executes this Agreement,
Employee’s employment with and service to Employer shall end effective May 6, 2011 (“Separation
Date”); and
WHEREAS, Employer and Employee desire to resolve any and all matters, claims, controversies,
disputes, or grievances relating to Employee’s employment or separation from employment with
Employer;
NOW, THEREFORE, in consideration of the mutual promises and commitments made herein, and
intending to be legally bound hereby, Employer and Employee agree as follows:
1. Employee acknowledges and agrees he has received all compensation and other benefits to
which he is entitled through the Separation Date, including without limitation, payment for any
earned but unused vacation. Employee further agrees that his most recent bonus was paid on March
26, 2010, in the amount of $66,690.
2. Pursuant to and in accordance with Section 11.f(ii) of the Amended and Restated Xxxxxx X.
Xxxxxx Employment Agreement, amended and restated as of March 17, 2009 (“the Employment Agreement”)
and Employer’s obligations thereunder:
| (a) | following the Separation Date Employee will receive payments,
payable ratably over a two-year period in accordance with Employer’s regular
payroll schedule, in the total gross amount of $694,980, less normal payroll
tax withholdings, which total amount represents the non-insurance severance
benefit to Employee under Section 11f.(ii) of the Employment Agreement; and |
| (b) | for a twenty-four month period following the Separation Date,
Employer will continue to provide medical, dental and life insurance coverage
to Employee in accordance with Section 11f.(ii) of the Employment Agreement. |
Payments under this Section 2 will begin with the first payroll following the Separation Date, and
are subject and pursuant to the provisions of Sections 16 and 17 of this Agreement.
3. In consideration of Employee’s agreements herein,
| (a) | Employer will pay to Employee a Separation Payment (the
“Separation Payment”) in the total amount of $186,000.00, less normal
withholdings, as a lump sum. |
| (b) | Employer will make available to Employee outplacement
assistance appropriate for an executive level employee, for a period of up to
twelve (12) months, beginning on a date to be determined at Employee’s option,
but no later than 90 days after the Effective Date, through a provider to be
determined by Employer in Employer’s sole discretion. |
The Separation Payment and other benefits under this Section 3 will be paid and/or begin no later
than thirty (30) days following the Separation Date, provided Employee returns this signed
Agreement and the seven day revocation period set forth in Section 14 below expires without
Employee revoking this Agreement. This consideration is not compensation for past services
rendered.
4. Employee agrees to keep this Agreement and its terms and conditions confidential, and
agrees not to disclose or discuss the fact of or the contents, terms, or conditions of this
Agreement except to his respective attorneys, accountants, advisers and members of his immediate
family.
5. Employee agrees to cooperate with and to respond promptly to Employer’s reasonable requests
for information relating to Employer’s job duties with Employee.
6. Employee agrees to refrain from disclosing to anyone any proprietary or confidential
information of Employer, including without limitation that confidential information defined in any
policy or agreement signed by him about or relating to Employer, its past and present parents,
subsidiaries, divisions and related and affiliated organizations, and their respective past and
present employees, clients, visitors, and business operations. Employee agrees that his
post-employment-termination obligations and restrictions arising under the Employment Agreement,
are and will remain in full force and effect after the Separation Date. For the avoidance of
doubt, Employer and Employee specifically agree that, in consideration of Employer’s undertakings
herein, and for other good and valuable consideration, the sufficiency of which Employee
acknowledges, Employee agrees that (i) his obligations under Section 10c. of the Employment
Agreement continue in effect; and (ii) during the period ending one year after the Separation Date,
Employee shall not serve as an officer, director or employee of any bank holding company, bank,
savings bank, savings and loan holding company, or mortgage company (any of which, a “Financial
Institution”) which Financial Institution
offers products or services competing with those offered by Employer from any office within
thirty (30) miles from the main office or any branch of the bank and shall not interfere with the
relationship of Employer and any of its employees, agents, or representatives. If there is a
breach or threatened breach of Employee’s agreements in this paragraph, the parties agree that
there is no adequate remedy at law for such breach, and that Employer shall be entitled to
injunctive relief restraining Employee from such breach or threatened breach, but such relief shall
not be the exclusive remedy hereunder for such breach.
7. Employee shall return to Employer any and all property of Employer, including but not
limited to any of Employer’s electronic equipment, letters, memoranda, records, reports, notes,
notebooks, books of account, data, drawings, prints, plans, specifications, formulae and
correspondence or copies of the same (including any electronically stored copies), information or
property in his possession or control about or relating to Employer, its past and present parents,
subsidiaries, divisions and related and affiliated organizations, and their respective past and
present employees, clients, visitors, and business operations.
8. Employee hereby releases and forever discharges Employer and its past and present parents,
subsidiaries, divisions and related and affiliated organizations, and their respective officers,
shareholders, directors, attorneys, agents, servants and employees and their successors, heirs and
assigns from all causes of action, claims, debts, accounts, controversies, sums of money,
contracts, promises, agreements, judgments, demands, and liabilities of any kind or nature
whatsoever in law, in equity, or otherwise, whether known or unknown, whether asserted or
unasserted, including without limitation any and all claims for employment discrimination, wrongful
discharge, compensation, benefits, bonuses, incentives, expenses, options, wages, severance pay,
vacation pay, fringe benefits, or other monies or accountings, including punitive damages,
liquidated damages, exemplary damages, or compensatory damages, physical, mental, or emotional
distress, pain and suffering, back pay, front pay, costs, and attorneys’ fees, and any other legal
or equitable relief, and further including without limitation any and all rights and claims arising
under the Age Discrimination in Employment Act, 29 U.S.C. § 621 et seq., as amended, the
Pennsylvania Human Relations Act, or claims relating to Employee’s employment or separation from
employment with Employer, or any other cause, reason, matter, or thing whatsoever, arising up until
the date of Employee’s execution of this Agreement, except that this release does not extend to
claims for worker’s compensation benefits, amounts owed under this Agreement, claims for vested
employee benefits under the Employee Retirement Income Security Act, claims relating to the
validity or enforcement of this Agreement, or other non-waivable claims. By entering into this
Agreement, Employer does not admit that it is liable to Employee for anything on account of any
reason whatsoever, except as set forth in this Agreement.
9. Employer and Employee agree that, to the full extent permissible by law, the terms of this
Agreement shall be interpreted under and consistently with the laws of the Commonwealth of
Pennsylvania and federal law and that to the full extent provided by law the federal and/or state
courts within the Commonwealth of Pennsylvania shall have jurisdiction over any claims arising out
of this Agreement.
10. Employee agrees, subject to any obligations he may have under applicable law, that he will
not make or cause to be made any statements that disparage, are inimical to, or damage the
reputation of the Employer or any of its affiliates, subsidiaries, agents, officers, directors or
employees.
11. If any court of competent jurisdiction shall hold invalid any part of this Agreement, then
the court making such determination shall have the right to modify this Agreement and in its
reduced form this Agreement shall be enforceable to the fullest extent permitted by law. If any
provision or part of a provision of this Agreement is held to be invalid or unenforceable, such
provision shall be severed from this Agreement and the remaining provisions shall remain in full
force and effect. This paragraph shall be interpreted to give the fullest possible effect to
Employee’s release of claims.
12. This document states the whole agreement between the parties as to its terms and
supersedes all prior or contemporaneous agreements, offers, representations, negotiations or
discussions with respect to such subject matters. Any changes to this Agreement must be in writing
and initialed or signed by both parties. Employee understands and acknowledges that in deciding
whether to sign this Agreement, he is not relying on any promises, statements or representations,
oral or written, other than those that are set forth expressly in this Agreement.
13. Employee agrees that he will not file, or permit to be filed in his name or on his behalf,
any lawsuit in court against any of the persons or entities released in this Agreement, based upon
any act or event which occurred on or before his execution of this Agreement. Employee further
agrees that, although he has the right to file a charge with the Equal Employment Opportunity
Commission, should he file such a charge, or should any charge, lawsuit, complaint or other claim
be filed in his name or on his behalf with the Equal Employment Opportunity Commission or with any
other administrative agency or organization, or in any other forum, against any of the persons or
entities released herein, based upon any act or event which occurred on or before the effective
date of this Agreement, he will not seek or accept any personal relief based upon such charge,
lawsuit, complaint or other claim, including but not limited to an award of monetary damages or
reinstatement to his employment with Employer.
14. Employee hereby represents and acknowledges to Employer that (a) Employer has advised
Employee in writing to consult with an attorney of his choosing and he has had the opportunity to
do so before signing this Agreement; (b) Employee has the right to consider whether to sign this
Agreement for up to 21 days after his receipt of it, although he need not take the entire 21-day
period to consider whether to sign it, and Employee hereby waives any right he may have to the
extension of this 21-day period by reason of any revisions which may have been made to this
Agreement after discussion between Employee and/or Employee’s legal counsel and Employer and/or
Employer’s legal counsel, regardless of the materiality of those revisions; (c) Employee has seven
(7) days after signing this Agreement in which to revoke it by delivering a written notice of such
revocation to Beneficial Mutual Savings Bank, addressed to: Xxxxxx Xxxxxxx, Human Resources
Department Manager, Beneficial Mutual Savings Bank, 000 Xxxxxx Xxxxxx,
Xxxxxxxxxxxx, XX 00000;
phone — 000-000-0000; fax 000-000-0000; e-mail — xxxxxxxx@xxxxxxxxxxxxx.xxx; and (d) the consideration provided Employee under this Agreement
is sufficient to support the releases provided by him under this Agreement and is greater than
Employee would be entitled to receive if he did not sign this Agreement. Employee understands that
Employer regards the representations made by him as material and that Employer is relying on these
representations in entering into this Agreement. Employee acknowledges and agrees that the
Employer’s obligation to make payments or provide the benefits under this Agreement will not
commence until the period for revocation has passed and this Agreement becomes irrevocable by
Employee.
15. Employee specifically acknowledges and agrees that he is not a participant in, and is not
entitled to any benefits under, the Severance Pay Plan for Eligible Employees of Beneficial Mutual
Bancorp, Inc., amended and restated effective March 9, 2009. Employee is entitled to receive
payments and distributions from all benefit plans (each referred to as a “Plan”) in which he
participated in accordance with the terms of each Plan. Provided, however, to the extent that
Employee is a “Specified Employee”, as defined in Section 16 below, no payments or distributions
shall be made to Employee from the following Plans prior to the 1st day of the
7th month following the Separation Date: Beneficial Transition Credit Retirement Plan
for Designated Employees, Salary Continuation Plan, Cash-Based Deferral Plan (EDCP) and Stock-Based
Deferral Plan. Employer agrees to indemnify and hold harmless Employee for any tax, penalty or
costs resulting from Employer’s failure to make such payments and distributions to Employee in
accordance with the terms of this Agreement.
16. Notwithstanding anything in this Agreement to the contrary, to the extent payments do not
meet the short-term deferral exception of Section 409A of the Internal Revenue Code and, in the
event Employee is a “Specified Employee” (as defined herein), no payment shall be made to Employee
under this Agreement prior to the first day of the seventh month following the Separation Date in
excess of the “permitted amount” under Section 409A of the Code. For these purposes the “permitted
amount” shall be an amount that does not exceed two times the lesser of: (A) the sum of Employee’s
annualized compensation based upon the annual rate of pay for services provided to the Employer for
the calendar year preceding the year in which the Separation Date occurs, or (B) the maximum amount
that may be taken into account under a tax-qualified plan pursuant to Section 401(a)(17) of the
Internal Revenue Code for the calendar year in which the Separation Date occurs. Any payments up
to the permitted amount may be made beginning on the 30th day following the Separation
Date. Any payment in excess of the permitted amount shall be made to Employee beginning on the
first day of the seventh month following the Separation Date. “Specified Employee” shall be
interpreted to comply with Section 409A of the Internal Revenue Code and shall mean a key employee
within the meaning of Section 416(i) of the Internal Revenue Code (without regard to Section 5
thereof), but an individual shall be a “Specified Employee” only if the Employer is a
publicly-traded institution or a subsidiary of a publicly traded institution.
17. For purposes of section 409A of the Internal Revenue Code, all payments made under this
Agreement on or before March 15, 2012 are regarded as and shall be treated as short-term deferral
payments, all payments made after March 15, 2012 up to the permitted amount are being made upon a
“separation from service” (within the meaning of such term under section 409A of the Internal Revenue Code), each payment made under
this Agreement shall be treated as a separate payment, the right to a series of installment
payments under this Agreement is to be treated as a right to a series of separate payments, and if
a payment is not made by the designated payment date under this Agreement, the payment shall be
made by December 31 of the calendar year in which the designated date occurs. To the extent that
any payment provided for hereunder would be subject to additional tax under section 409A of the
Internal Revenue Code, or would cause the administration of this Agreement to fail to satisfy the
requirements of section 409A, such provision shall be deemed null and void to the extent permitted
by applicable law, and any such amount shall be payable on the 1st day of the
7th month following the Separation Date. In no event shall the Employee, directly or
indirectly, designate the calendar year of payment. The Company, Bank and Employee all agree to
report all amounts paid to Employee hereunder for federal and state tax purposes as having been
made in accordance with this Section 17.
18. Employee shall be indemnified by the Company and Bank as to any liability, cost or expense
for which the Employee would have been indemnified during employment or thereafter, in accordance
with Section 13 of the Employment Agreement, the Company’s or Bank’s certificate of incorporation,
by-laws, or charter or any insurance coverage in force for employees, executives or officers of the
Company or bank and for actions taken on behalf of the Company or Bank within the scope of the
Employee’s employment by the Company and Bank or within the scope of Employee’s duties as an
officer of the Company and Bank. It is expressly understood and agreed that Section 13 of the
Employment Agreement shall survive Employee’s separation of employment.
19. In the event of Employee’s death prior to Employee’s receipt of all payments and benefits
provided for in Sections 2 and 15 of this Agreement, such payments and benefits shall be paid
and/or distributed to Employee’s heirs and personal representative.
20. This Agreement shall inure to the benefit of and be binding upon any corporate or other
successor to the Company and the Bank which shall acquire, directly or indirectly, by merger,
consolidation, purchase or otherwise, all or substantially all of the assets or stock of the
Company and the Bank.
21. Employee acknowledges that, under federal securities law, Employer is obligated to
disclose the material terms of this Agreement and a copy of the Agreement in a filing on Form 8-K
or as otherwise advised by counsel.
Employee declares that he has completely read, fully understands and voluntarily accepts the
terms of this Agreement after complete consideration of all facts and legal claims.
IN WITNESS WHEREOF, and intending to be legally bound hereby, the parties have entered into
this Agreement as of the last date indicated below.
/s/ Xxxxxx X. Xxxxxx |
Dated: | 5/10/11 | ||||||||
| Xxxxxx X. Xxxxxx | ||||||||||
| Beneficial Mutual Bancorp., Inc. and | ||||||||||
| Beneficial Mutual Savings Bank | ||||||||||
By:
|
Xxxxxx Xxxxxxx | Dated: | 5/10/11 | |||||||
| Title: | Senior Vice President | |||||||||
