Seidman files for lawsuit dismissal after Eastern Bank makes offer for Massbank

By Lisa Kerner

Charlotte, N.C., March 24 - Seidman and Associates, LLC filed a stipulation order of dismissal without prejudice in its litigation against Massbank Corp. and its directors challenging the validity of a bylaws change, according to a schedule 13D/A filing with the Securities and Exchange Commission.

The filing also said Massbank postponed its 2008 annual meeting in order to schedule a special meeting of stockholders. At the special meeting, stockholders will vote on a proposed merger with Eastern Bank Corp.

On March 11, Eastern Bank announced it agreed to acquire Massbank for about $170 million in cash.

On Feb. 29, Massbank rejected Seidman's nominees - Lawrence B. Seidman, Thomas Goggins and Welles Hatch - for election to the company's board, saying they did not meet the minimum threshold qualifications for nomination, election or service under article II, section 2A of Massbank's bylaws.

Massbank, in rejecting the nominees, cited its bylaw that disqualifies a person or persons who fail to file certain beneficial stock ownership reports, fail to receive any necessary regulatory approvals relating to stock ownership or who have been found guilty of conduct involving personal dishonesty, a breach of fiduciary duty or violation of banking or securities laws.

In the past, Seidman, a 7.54% shareholder, recommended that the Reading, Mass., bank holding company accelerate share repurchases and consider a possible Dutch auction.

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