CNBKA Century BanCorp Inc

PROPOSAL 1—APPROVAL OF THE MERGER AGREEMENT

The information in this proxy statement concerning the terms of the merger agreement is qualified in its entirety by reference to the full text of the merger agreement, which is attached as Appendix A, which is incorporated by reference herein. We encourage all shareholders to read the merger agreement. All information contained in this proxy statement with respect to Eastern and its subsidiaries has been supplied by Eastern for inclusion herein and has not been independently verified by Century.

Terms of the Merger

Each of Eastern’s and Century’s respective boards of directors has unanimously approved the merger agreement. Pursuant to the merger agreement, Century will merge with and into Merger Sub. The surviving company in the merger will be Century, and each outstanding share of Class A Common Stock and Class B Common Stock of Century will be converted into the right to receive $115.28 in cash at closing. Immediately thereafter, Century will merge with and into Eastern. The surviving company in the merger will be Eastern. Immediately thereafter, Century Bank will merge with and into Eastern Bank. The surviving bank in the merger will be Eastern Bank.

Holders of Century’s Class A Common Stock and Class B Common Stock are being asked to approve the merger agreement. See “The Merger Agreement” beginning on page 36 of this proxy statement for additional and more detailed information regarding the legal documents that govern the merger, including the conditions to completion of the merger and the provisions for terminating or amending the merger agreement.

Background of the Merger

From time to time throughout 2020 and 2021, Century’s Chairman, President and Chief Executive Officer, Barry R. Sloane, received calls from several financial institutions in the New England region expressing an interest in potentially pursuing a strategic combination with Century.

As part of these discussions, on October 20, 2020, Mr. Sloane received a telephone call from Robert Rivers, Eastern’s Chief Executive Officer. During that call, Mr. Rivers asked Mr. Sloane if Century would be interested in initiating discussions regarding a cash acquisition of Century at a price in the range of 150% of Century’s tangible book value. While Mr. Rivers did not frame the indication of interest in terms of a price per share, based on Century’s tangible book value at September 30, 2020 of $64.79, a price equal to 150% of that tangible book value would have been approximately $97.19 per share. Mr. Sloane indicated that Eastern would need to propose a higher multiple to tangible book value to warrant further discussions regarding a combination transaction. On October 20, 2020, the closing price of Century’s Class A common stock was $72.88.

On or about November 30, 2020, Mr. Rivers called Mr. Sloane and indicated that Eastern would be interested in pursuing a transaction at a price equal to 170% of Century’s tangible book value. While Mr. Rivers again did not frame the indication of interest in terms of a price per share, based on Century’s tangible book value at September 30, 2020 of $64.79, the implied price would have been approximately $110.14 per share. On November 30, 2020, the closing price of Century’s Class A common stock was $73.90.

On or about December 7, 2020, Mr. Sloane reached out by telephone to the Chief Executive Officer of Company A, an active buyer in the New England market asking if he would be interested in submitting an indication of interest on behalf of Company A. On December 15, 2020, the Chief Executive Officer of Company A called Mr. Sloane and indicated that Company A would be willing to pursue an acquisition of Century for a price of $110 per share.

On or about December 15, 2020, Mr. Sloane reached out by telephone to the Chief Executive Officer of Company B, another active buyer in the New England market. On December 24, 2020, the Chief Executive Officer of Company B returned Mr. Sloane’s telephone call, and Mr. Sloane invited the Chief Executive Officer

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to submit an indication of interest on behalf of Company B. There were no further communications between the Chief Executive Officer of Company B and Mr. Sloane, and Company B did not submit an indication of interest in connection with Century’s outreach regarding a potential transaction.

On January 19, 2021, at a regularly scheduled meeting of the Century board of directors, Century’s management provided an update to the board of directors regarding strategic options for the bank in light of competitive forces changing the industry. Mr. Sloane also briefed the board of directors on the indications of interest from Eastern and Company A, and the board of directors authorized Mr. Sloane to continue to engage in discussions regarding a potential transaction. The board of directors also discussed retaining Piper Sandler as strategic and financial advisor in connection with merger and acquisition negotiations given their experience in the industry with respect to such matters. On January 22, 2021, a formal engagement letter was executed by Century and Piper Sandler.

In early February, a representative from Piper Sandler reached out by telephone to the Chief Executive Officer of Company C and invited the Chief Executive Officer to submit an indication of interest on behalf of Company C. There were no further communications between the Chief Executive Officer of Company C, Mr. Sloane, and the representative of Piper Sandler.

Also in early February, an investment banker representing Company A indicated verbally to a representative of Piper Sandler that Company A would be willing to pursue an acquisition of Century for a price of $112 per share.

On February 9, 2021, at a regularly scheduled meeting of the Century board of directors, representatives of Piper Sandler updated the board of directors on the merger and acquisitions market in the banking industry. Piper Sandler then presented preliminary financial models reflecting a transaction between Century and each of Company A and Eastern, and compared the implied metrics of each potential transaction, highlighting various pricing metrics and the capital levels of the resulting institution. Piper Sandler also outlined the typical timeline for a merger transaction and engaged in a discussion with the board regarding the possibility of other potential acquirors of Century emerging, noting that Company A and Eastern remained the most likely acquirers given their respective financial position and geographic alignment. Goodwin Procter LLP, Century’s outside legal counsel (“Goodwin”), was also present at the meeting and summarized the board of directors’ fiduciary duties in the context of pursuing a potential sale of Century.

On February 22 and 23, 2021, Century and Goodwin negotiated the terms of non-disclosure agreements with each of Eastern and Company A, each of which included a one-year standstill provision and customary obligations to preserve the confidentiality of information provided by Century. The non-disclosure agreements were executed on February 23, 2021. Eastern and Company A were then granted access to an electronic data room, which included a confidential information memorandum requesting a non-binding expression of interest no later than March 9, 2021.

Between February 23, 2021 and March 3, 2021, members of Century’s management team met with the respective management teams of each of Eastern and Company A. On March 3, 2021, Company A indicated that it would decline to submit an expression of interest citing a lack of strategic alignment between the two companies.

On March 8, 2021, Eastern submitted a non-binding expression of interest to Piper Sandler in which Eastern proposed to acquire 100% of Century’s Class A common stock and Class B common stock (together, the “common stock”) for $112.25 per share in cash. On March 9, 2021, at a regularly scheduled meeting of the Century board of directors, the board discussed the non-binding expression of interest. Following intensive negotiation between the parties regarding deal pricing, on March 12, 2021, Eastern revised its non-binding expression of interest to reflect a proposal to acquire Century’s outstanding common stock for $115.28 per share in cash. Mr. Sloane continued to regularly update members of the Century board of directors on the progress of due diligence and negotiations relating to the proposed transaction with Eastern and the board members authorized Mr. Sloane to continue to engage in negotiations with respect to a potential transaction.

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On March 16, 2021, Century executed the non-binding expression of interest with Eastern, and entered into an exclusivity agreement with Eastern. The exclusivity agreement provided that for a period of 30 days, Century agreed to negotiate exclusively with Eastern and not to solicit or take any other action designed to facilitate, or that could reasonably be expected to result in, a business combination or sale of substantially all of Century’s assets.

On March 18, 2021, Nutter McClennen & Fish LLP, Eastern’s legal counsel (“Nutter”), provided a draft merger agreement to Goodwin.

On March 23, 2021, at a special meeting of the Century board of directors, representatives from Piper Sandler reviewed Eastern’s proposal, including the pricing metrics of the proposal as compared to recent regional bank and thrift transactions. Piper Sandler noted that the transaction would be valued at approximately 175% of price-to-tangible book value based on Century’s tangible book value per share of $66.04 on December 31, 2020, which exceeded the means and medians of recent comparable regional bank and thrift transactions. The board of directors engaged in a discussion with Piper Sandler regarding the presentation as well as whether there were any other potential acquirors in the market. The board of directors concluded that Eastern was likely the only bank with the financial capacity to pursue an acquisition of Century and authorized Mr. Sloane, Piper Sandler, and Goodwin to continue negotiations and diligence with respect to a potential transaction with Eastern. A representative of Goodwin then reviewed the terms of the non-binding expression of interest and exclusivity agreement. The board of directors discussed the fact that under the expression of interest, neither Mr. Sloane nor Ms. Kay will continue in Eastern’s employ after the closing of the transaction. The board of directors unanimously adopted a resolution approving the entry into the non-binding expression of interest and exclusivity agreement.

On March 27, 2021, Goodwin sent Century’s proposed revisions to the merger agreement to Nutter. Between March 27, 2021 and April 7, 2021, multiple drafts of the merger agreement were exchanged, and representatives of Goodwin and representatives of Nutter participated in calls to discuss open issues, which included deal protections, including Century’s proposal for it to have a fiduciary right of termination, the timing of closing, the conduct of Century’s business prior to closing, and employee matters.

On April 6, 2021, representatives of Piper Sandler, Goodwin and Century conducted due diligence interviews of Eastern management to determine, among other things, if there were any issues concerning Eastern that would affect Eastern’s ability to consummate the transaction.

On April 7, 2021, Century convened a special meeting of its board of directors to review and approve the merger agreement and the proposed merger with Eastern. Representatives of Piper Sandler and Goodwin also attended the meeting.

A representative of Piper Sandler summarized the historical financial performance of Eastern and provided a financial overview of the proposed merger. The Piper Sandler representative also highlighted pricing measures for the proposed transaction and compared them to merger transactions involving comparably sized financial institutions in the Northeast region. Piper Sandler noted that the pricing terms generally exceeded the averages and medians for price-to-tangible book value and the core deposit premiums as compared to the lists of comparable transactions. The Piper Sandler representative also discussed merger-related costs and answered questions from the board of directors.

The Piper Sandler representative then delivered Piper Sandler’s oral opinion that, as of April 7, 2021, and subject to the assumptions made, procedures followed, matters considered and limitations on the review undertaken, as set forth in the opinion, the merger consideration to be paid to Century common shareholders was fair from a financial point of view. The Piper Sandler representative confirmed that Piper Sandler’s written opinion, dated April 7, 2021, would be delivered to the board of directors following the meeting.

A representative of Goodwin reviewed the board of directors’ fiduciary duties in connection with the potential sale of Century. A representative of Goodwin then reviewed in detail the terms of each section of the

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merger agreement and the voting agreement and answered questions relating to the merger agreement and related documents and disclosure schedules.

The directors then unanimously voted to adopt the merger agreement and recommend that Century shareholders vote to approve the merger agreement and the transactions contemplated thereby.

The Eastern board of directors also met on April 7, 2021 and unanimously voted to adopt and approve the merger agreement and the transactions contemplated thereby.

On April 7, 2021, following the completion of the Century and Eastern boards of directors meetings and the close of the market, Century and Eastern executed and delivered the merger agreement and issued a joint press release announcing the execution of the merger agreement.

Recommendation of the Century Board of Directors

Our board of directors unanimously adopted the merger agreement and directed that the merger agreement be submitted to Century’s shareholders. Our board of directors unanimously recommends that you vote “FOR” the approval of the merger agreement proposal, “FOR” the merger-related named executive officer compensation proposal and “FOR” the adjournment proposal, if necessary.

Century’s Reasons for the Merger

In arriving at its determination to unanimously adopt and approve the merger agreement, our board of directors evaluated the merger and the merger agreement in consultation with Century’s executive management, financial advisor, and legal counsel, drew on its knowledge of Century’s business, operations, properties, assets, financial condition, operating results, historical market prices and prospects, and also considered the following factors in favor of its decision to enter into the merger agreement:

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Our board of directors also considered the following factors as generally weighing against a decision to enter into the merger agreement:

Our board of directors also considered the interests of certain executive officers and directors of Century, which are different from, or in addition to, the interests of Century shareholders generally. See “Interests of Century Directors and Executive Officers in the Merger,” beginning on page 33 of this proxy statement.

The foregoing discussion of the factors considered by our board of directors is not intended to be exhaustive, but does set forth the principal factors considered by our board of directors. Our board of directors collectively reached the unanimous conclusion to adopt the merger agreement and approve the transactions contemplated under the merger agreement in light of the various factors described above and other factors that each member of our board of directors felt was appropriate. In view of the wide variety of factors considered by our board of directors in connection with its evaluation of the transactions contemplated under the merger agreement and the complexity of these matters, our board of directors did not consider it practical and did not attempt to quantify, rank or otherwise assign relative weights to the specific factors it considered in reaching its decision. Rather, our board of directors made its recommendation based on the totality of information presented to and the investigation conducted by it. In considering the factors discussed above, individual directors may have given different weights to different factors.

Opinion of Century’s Financial Advisor

Century retained Piper Sandler to act as financial advisor to Century’s board of directors in connection with Century’s consideration of a possible business combination with Eastern. Century selected Piper Sandler to act as

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its financial advisor because Piper Sandler is a nationally recognized investment banking firm whose principal business specialty is financial institutions. In the ordinary course of its investment banking business, Piper Sandler is regularly engaged in the valuation of financial institutions and their securities in connection with mergers and acquisitions and other corporate transactions.

Piper Sandler acted as financial advisor to Century’s board of directors in connection with the proposed merger and participated in certain of the negotiations leading to the execution of the agreement. At the April 7, 2021 meeting at which Century’s board of directors considered the merger and the merger agreement, Piper Sandler delivered to the Century’s board of directors its oral opinion, which was subsequently confirmed in writing on April 7, 2021, to the effect that, as of such date, the merger consideration was fair to the holders of Century’s Class A Common Stock and Class B Common Stock (together, the “common stock”) from a financial point of view. The full text of Piper Sandler’s opinion is attached as Appendix B to this proxy statement. The opinion outlines the procedures followed, assumptions made, matters considered and qualifications and limitations on the review undertaken by Piper Sandler in rendering its opinion. The description of the opinion set forth below is qualified in its entirety by reference to the full text of the opinion. Holders of Century’s common stock are urged to read the entire opinion carefully in connection with their consideration of the proposed merger.

Piper Sandler’s opinion was directed to Century’s board of directors in connection with its consideration of the agreement and does not constitute a recommendation to any shareholder of Century as to how any such shareholder should vote at any meeting of shareholders called to consider and vote upon the approval of the agreement and the merger. Piper Sandler’s opinion was directed only to the fairness, from a financial point of view, of the merger consideration to the holders of Century’s common stock and did not address the underlying business decision of Century to engage in the merger, the form or structure of the merger or any other transactions contemplated in the agreement, the relative merits of the merger as compared to any other alternative transactions or business strategies that might exist for Century or the effect of any other transaction in which Century might engage. Piper Sandler did not express any opinion as to the amount or nature of the compensation to be received in the merger by any Century officer, director or employee, or any class of such persons, if any, relative to the amount of compensation to be received by any other shareholder. Piper Sandler’s opinion was approved by Piper Sandler’s fairness opinion committee.

In connection with its opinion, Piper Sandler reviewed and considered, among other things:

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Piper Sandler also discussed with certain members of the senior management of Century the business, financial condition, results of operations and prospects of Century and held similar discussions with certain members of the senior management of Eastern and its representatives regarding the business, financial condition, results of operations and prospects of Eastern.

In performing its review, Piper Sandler relied upon the accuracy and completeness of all of the financial and other information that was available to and reviewed by Piper Sandler from public sources, that was provided to Piper Sandler by Century or Eastern or their respective representatives, or that was otherwise reviewed by Piper Sandler, and Piper Sandler assumed such accuracy and completeness for purposes of rendering its opinion without any independent verification or investigation. Piper Sandler relied on the assurances of the respective managements of Century and Eastern that they were not aware of any facts or circumstances that would have made any of such information inaccurate or misleading. Piper Sandler was not asked to and did not undertake an independent verification of any of such information and Piper Sandler did not assume any responsibility or liability for the accuracy or completeness thereof. Piper Sandler did not make an independent evaluation or perform an appraisal of the specific assets, the collateral securing assets or the liabilities (contingent or otherwise) of Century or Eastern, nor was Piper Sandler furnished with any such evaluations or appraisals. Piper Sandler rendered no opinion or evaluation on the collectability of any assets or the future performance of any loans of Century or Eastern. Piper Sandler did not make an independent evaluation of the adequacy of the allowance for loan losses of Century or Eastern, or the combined entity after the merger, and Piper Sandler did not review any individual credit files relating to Century or Eastern. Piper Sandler assumed, with Century’s consent, that the respective allowances for loan losses for Century and Eastern were adequate to cover such losses and would be adequate on a pro forma basis for the combined entity.

In preparing its analyses, Piper Sandler used certain internal financial projections for Century for the year ending December 31, 2021, as well as annual long-term earnings per share and balance sheet growth rates for the years ending December 31, 2022 through December 31, 2025 and estimated dividends per share for Class A Common Stock and Class B Common Stock for the years ending December 31, 2021 through December 31, 2025, as provided by the senior management of Century. Piper Sandler also received and used in its pro forma analyses certain assumptions relating to purchase accounting adjustments and estimated transaction costs, as provided by the senior management of Eastern and its representatives. With respect to the foregoing information, the respective senior managements of Century and Eastern confirmed to Piper Sandler that such information reflected the best currently available projections and estimates of those respective managements of the future financial performance of Century and Eastern, respectively, and Piper Sandler assumed that such performance would be achieved. Piper Sandler expressed no opinion as to such projections or estimates, or the assumptions on which they were based. Piper Sandler also assumed that there had been no material change in Century’s or Eastern’s assets, financial condition, results of operations, business or prospects since the date of the most recent financial statements made available to Piper Sandler. Piper Sandler assumed in all respects material to its analysis that Century and Eastern would remain as going concerns for all periods relevant to its analyses.

Piper Sandler also assumed, with Century’s consent, that (i) each of the parties to the agreement would comply in all material respects with all material terms and conditions of the agreement and all related agreements, that all of the representations and warranties contained in such agreements were true and correct in

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all material respects, that each of the parties to such agreements would perform in all material respects all of the covenants and other obligations required to be performed by such party under such agreements and that the conditions precedent in such agreements were not and would not be waived, (ii) in the course of obtaining the necessary regulatory or third party approvals, consents and releases with respect to the merger, no delay, limitation, restriction or condition would be imposed that would have an adverse effect on Century, Eastern, the merger or any related transactions, and (iii) the merger and any related transactions would be consummated in accordance with the terms of the agreement without any waiver, modification or amendment of any material term, condition or agreement thereof and in compliance with all applicable laws and other requirements. Finally, with Century’s consent, Piper Sandler relied upon the advice that Century received from its legal, accounting and tax advisors as to all legal, accounting and tax matters relating to the merger and the other transactions contemplated by the agreement. Piper Sandler expressed no opinion as to any such matters.

Piper Sandler’s opinion was necessarily based on financial, economic, regulatory, market and other conditions as in effect on, and the information made available to Piper Sandler as of, the date thereof. Events occurring after the date thereof could materially affect Piper Sandler’s opinion. Piper Sandler has not undertaken to update, revise, reaffirm or withdraw its opinion or otherwise comment upon events occurring after the date thereof. Piper Sandler expressed no opinion as to the trading value of Century’s common stock at any time.

In rendering its opinion, Piper Sandler performed a variety of financial analyses. The summary below is not a complete description of all the analyses underlying Piper Sandler’s opinion or the presentation made by Piper Sandler to Century’s board of directors, but is a summary of the material analyses performed and presented by Piper Sandler. The summary includes information presented in tabular format. In order to fully understand the financial analyses, these tables must be read together with the accompanying text. The tables alone do not constitute a complete description of the financial analyses. The preparation of a fairness opinion is a complex process involving subjective judgments as to the most appropriate and relevant methods of financial analysis and the application of those methods to the particular circumstances. The process, therefore, is not necessarily susceptible to a partial analysis or summary description. Piper Sandler believes that its analyses must be considered as a whole and that selecting portions of the factors and analyses to be considered without considering all factors and analyses, or attempting to ascribe relative weights to some or all such factors and analyses, could create an incomplete view of the evaluation process underlying its opinion. Also, no company included in Piper Sandler’s comparative analyses described below is identical to Century or Eastern and no transaction is identical to the merger. Accordingly, an analysis of comparable companies or transactions involves complex considerations and judgments concerning differences in financial and operating characteristics of the companies and other factors that could affect the public trading values or transaction values, as the case may be, of Century and Eastern and the companies to which they were compared. In arriving at its opinion, Piper Sandler did not attribute any particular weight to any analysis or factor that it considered. Rather, Piper Sandler made qualitative judgments as to the significance and relevance of each analysis and factor. Piper Sandler did not form an opinion as to whether any individual analysis or factor (positive or negative) considered in isolation supported or failed to support its opinion, rather, Piper Sandler made its determination as to the fairness of the merger consideration to the holders of Century common stock on the basis of its experience and professional judgment after considering the results of all its analyses taken as a whole.

In performing its analyses, Piper Sandler also made numerous assumptions with respect to industry performance, business and economic conditions and various other matters, many of which cannot be predicted and are beyond the control of Century, Eastern, and Piper Sandler. The analyses performed by Piper Sandler are not necessarily indicative of actual values or future results, both of which may be significantly more or less favorable than suggested by such analyses. Piper Sandler prepared its analyses solely for purposes of rendering its opinion and provided such analyses to Century’s board of directors at its April 7, 2021 meeting. Estimates on the values of companies do not purport to be appraisals or necessarily reflect the prices at which companies or their securities may actually be sold. Such estimates are inherently subject to uncertainty and actual values may be materially different. Accordingly, Piper Sandler’s analyses do not necessarily reflect the value of Century’s common stock or Eastern common stock or the prices at which Century common stock or Eastern common stock

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may be sold at any time. The analyses of Piper Sandler and its opinion were among a number of factors taken into consideration by Century’s board of directors in making its determination to approve the merger agreement and the analyses described below should not be viewed as determinative of the decision of Century’s board of directors with respect to the fairness of the merger consideration.

Summary of Proposed Merger Consideration and Implied Transaction Metrics

Piper Sandler reviewed the financial terms of the proposed merger. Pursuant to the terms of the agreement, at the closing of the merger, each share of the Class A Common Stock, par value $1.00 per share, of Century issued and outstanding immediately prior to the closing of the merger and each share of the Class B Common Stock, par value $1.00 per share, of Century, except for certain shares as set forth in the agreement, shall be converted, in accordance with the procedures set forth in the agreement, into the right to receive $115.28, without interest, in cash. Piper Sandler calculated an aggregate implied transaction value of $641.9 million with $421.4 million of the consideration paid to Class A shareholders and $220.5 million of the consideration paid to Class B shareholders. Based upon financial information for Century as of or for the last twelve months (“LTM”) ended December 31, 2020 and the closing price of Century’s common stock on April 5, 2021, Piper Sandler calculated the following implied transaction metrics:

Stock Trading History

Piper Sandler reviewed the publicly available historical reported trading price of Century common stock for the one-year and three-year period ended April 5, 2021. Piper Sandler then compared the relationship between the movements in the price of Century common stock to movements in their respective peer groups (as described below) as well as certain stock indices.

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Comparable Company Analyses

Piper Sandler used publicly available information to compare selected financial information for Century with a group of financial institutions selected by Piper Sandler based on its experience and professional judgment. The Century peer group included major exchange-traded (NYSE, NYSEAM, and NASDAQ) banks and thrifts headquartered in the New England region with total assets between $1B and $10B, but excluded targets of announced merger transactions and New England banks with differentiated business models (the “Century Peer Group”). The Century Peer Group consisted of the following companies:

The analysis compared publicly available financial information for Century with corresponding data for the Century Peer Group as of or for the year ended December 31, 2020 (unless otherwise noted) with pricing data as of April 5, 2021. The table below sets forth the data for Century and the median, mean, low and high data for the Century Peer Group.

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Analysis of Precedent Transactions

Piper Sandler reviewed two groups of selected merger and acquisition transactions, including a regional and nationwide group, based on its experience and professional judgment. The regional group consisted of bank and thrift transactions announced between January 1, 2018 and April 5, 2021 where the target was headquartered in New England and had total assets between $500 million and $10 billion at announcement, but excluded Merger of Equals transactions (the “Regional Precedent Transactions”). The nationwide group consisted of nationwide bank and thrift transactions announced between January 1, 2019 and April 5, 2021 where the target’s total assets were between $2 billion and $10 billion at announcement, but excluded Merger of Equals transactions and transactions with acquirers or targets not headquartered in the continental United States (the “Nationwide Precedent Transactions”).

The Regional Precedent Transactions group was composed of the following transactions:

The Nationwide Precedent Transactions group was composed of the following transactions:

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Using the latest publicly available information prior to the announcement of the relevant transactions, Piper Sandler reviewed the following transaction metrics: deal value, transaction price to last-twelve-months earnings per share, transaction price to estimated earnings per share, transaction price to tangible book value per share, core deposit premium, and one-day market premium. Piper Sandler compared the indicated transaction metrics for the transaction to the median, mean, low and high metrics of the Regional Precedent Transactions group as well as to the median, mean, low and high metrics of the Nationwide Precedent Transactions group.

Net Present Value Analyses

Piper Sandler performed an analysis that estimated the net present value of Century common stock assuming Century performed in accordance with certain internal financial projections for the year ending December 31, 2021, as well as annual long-term earnings per share and balance sheet growth rates for the years ending December 31, 2022 through December 31, 2025 and estimated dividends per share for Class A Common Stock and Class B Common Stock for the years ending December 31, 2021 through December 31, 2025, as provided by the senior management of Century. To approximate the terminal value of a share of Century common stock at December 31, 2025, Piper Sandler applied price to 2025 earnings multiples ranging from 10.0x to 17.5x and multiples of 2025 tangible book value ranging from 110% to 185%. The terminal values were then discounted to present values using different discount rates ranging from 10.0% to 13.0%, which were chosen to reflect different assumptions regarding required rates of return of holders or prospective buyers of Century common stock. As illustrated in the following tables, the analysis indicated an imputed range of values per share of Century common stock of $56.16 to $110.50 when applying multiples of earnings and $66.30 to $125.78 when applying multiples of tangible book value.

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Piper Sandler also considered and discussed with the Century’s board of directors how this analysis would be affected by changes in the underlying assumptions, including variations with respect to earnings. To illustrate this impact, Piper Sandler performed a similar analysis, assuming Century’s earnings varied from 15.0% above projections to 15.0% below projections. This analysis resulted in the following range of per share values for Century’s common stock, applying the price to 2025 earnings multiples range of 10.0x to 17.5x referred to above and a discount rate of 11.56%.

Piper Sandler noted that the net present value analysis is a widely used valuation methodology, but the results of such methodology are highly dependent upon the numerous assumptions that must be made, and the results thereof are not necessarily indicative of actual values or future results.

Pro Forma Results and Capital Ratios

Piper Sandler analyzed certain potential pro forma effects of the merger on Eastern’s capital ratios given certain assumptions relating to estimated transaction expenses and purchase accounting adjustments, as provided by the senior management of Eastern. The analysis indicated that projected at closing, the transaction would maintain Eastern’s regulatory capital ratios in excess of the regulatory guidelines for “well-capitalized” status. In

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connection with its pro forma analysis, Piper Sandler considered and discussed with Century’s board of directors how the results thereof are not necessarily indicative of actual values or future results. The actual results achieved by the combined company may vary from projected results and the variations may be material.

Piper Sandler’s Relationships

Piper Sandler is acting as Century’s financial advisor in connection with the transaction and will receive a fee for such services in an amount equal to 1.00% of the aggregate transaction value, which fee is contingent upon the closing of the merger. Piper Sandler’s transaction fee is $6.419 million. Piper Sandler also received a $150,000 fee from Century upon rendering its opinion, which opinion fee will be credited in full towards the transaction fee which will become payable to Piper Sandler upon closing of the transaction. Century has also agreed to indemnify Piper Sandler against certain claims and liabilities arising out of Piper Sandler’s engagement and to reimburse Piper Sandler for certain of its out-of-pocket expenses incurred in connection with Piper Sandler’s engagement.

Piper Sandler has not provided any other investment banking services to Century in the two years preceding the date of its opinion. Piper Sandler has not provided any investment banking services to Eastern in the two years preceding the date of its opinion. In the ordinary course of Piper Sandler’s business as a broker-dealer, Piper Sandler may purchase securities from and sell securities to Century and Eastern. Piper Sandler may also actively trade the equity and debt securities of Century and Eastern for Piper Sandler’s own account and for the accounts of Piper Sandler’s customers.

in general business or economic conditions, or any other transaction or event that has occurred or that may occur and that was not anticipated when the Projections were prepared. In addition, the Projections do not take into account any circumstances, transactions or events occurring after the dates on which the Projections were prepared. Accordingly, actual results will differ, and may differ materially, from those contained in the Projections. There can be no assurance that the financial results in the Projections will be realized, or that future actual financial results will not materially vary from those in the Projections.

The inclusion of a summary of the Projections should not be regarded as an indication that Century or Eastern or any of their respective affiliates, officers, directors, advisors or other representatives consider the Projections to be predictive of actual future events, and the Projections should not be relied upon as such. None of Century or Eastern or any of their respective affiliates, officers, directors, advisors or other representatives gives any shareholder of Century or any other person any assurance that actual results will not differ materially from the Projections, and, except as otherwise required by law, Century, Eastern and their respective affiliates undertake no obligation to update or otherwise revise or reconcile the Projections to reflect circumstances existing after the dates on which the Projections were prepared or to reflect the occurrence of future events, even in the event that any or all of the assumptions and estimates underlying the Projections are shown to be in error.

In light of the foregoing factors and the uncertainties inherent in the Projections, Century’s shareholders are cautioned not to place undue, if any, reliance on such Projections.

Summary of Management Projections

The following table presents a summary of the Projections, which has been included solely to give Century’s shareholders access to certain prospective financial information that was made available to the Century’s board and used by Piper Sandler, and is not included in this proxy statement to influence any decision of Century’s shareholders as to whether to vote to adopt the merger agreement or for any other purpose. The Projections include certain internal financial projections for Century for the year ending December 31, 2021, as well as annual long-term earnings per share for the years ending December 31, 2022 through December 31, 2025 and estimated dividends per share for each of Class A common stock and Class B common stock for the years ending December 31, 2021 through December 31, 2025, as provided by the senior management of Century. The Projections are based on Century management estimates for the year ending December 31, 2021, with an annual earnings per share growth rate of 4% for 2021 and 6% for the remaining years, and a long-term annual balance sheet growth rate of 4% for the remaining years. The projected financial data provided in this table has not been updated to reflect Century’s current views of its future financial performance, and should not be treated as guidance with respect to projected results for 2021 or any other period.

The Projections were used to derive projected net income based on assumptions provided by management, including (1) asset and net income from Century management in 2021 with a 4.0% annual asset growth thereafter and (2) 6% annual earnings per share growth thereafter. Based on these assumptions, the projected net income was: $43.9 million in 2021; $46.6 million in 2022; $49.4 million in 2023; $52.3 million in 2024; and $55.5 million in 2025. This information was not prepared with a view toward public disclosure, and actual results may differ materially from these projected amounts.

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INTERESTS OF CENTURY DIRECTORS AND EXECUTIVE OFFICERS IN THE MERGER

Century shareholders should be aware that directors and executive officers of Century have financial interests in the merger that may be different from, or in addition to, those of Century shareholders generally. As described in more detail below, these interests include certain payments and benefits that may be provided to directors and executive officers of Century upon completion of the merger or upon termination of their employment under certain circumstances following the merger, including cash severance, continued health, dental, life and accident insurance benefits, and retention bonuses.

Share Ownership of Century Directors and Executive Officers

As of May 27, 2021, the record date for the special meeting, the directors and executive officers of Century may be deemed to be the beneficial owners of 90,581 shares of Class A Common Stock, representing approximately 2.48% of the outstanding shares of Class A Common Stock and 1,781,841 shares of Class B Common Stock, representing approximately 93.32% of the outstanding shares of Class B Common Stock. See the section of this proxy statement titled “The Voting Agreements” on page 50 for further information regarding the voting agreements between Eastern and the Century directors and executive officers.

Change in Control Agreements

Eastern has entered into a change in control with David B. Woonton, Executive Vice President, and will enter into change in control agreements with certain of Century’s executive officers, including William P. Hornby, Chief Financial Officer and Treasurer, and Paul A. Evangelista, Executive Vice President. The change in control agreements with Messrs. Woonton, Hornby and Evangelista will become effective upon the closing of the merger and provide that in the event that the executive is terminated without death, “disability,” or “cause,” or resigns for “good reason” (all as defined in the change in control agreements) within one year of the effective time of the merger, the executive will receive a lump sum cash severance payment equal to two times the executive’s annual pre-tax salary in effect immediately prior to the date of termination, plus two times the amount of the executive’s 2020 bonus. In addition, Eastern will pay the employer contribution for the monthly premium for 12 months or the executive’s COBRA health continuation period, whichever ends earlier. Mr. Woonton’s change in control agreement replaces his offer letter, which provided for two years’ severance pay upon a change of control, at Mr. Woonton’s option. Mr. Woonton’s change in control agreement also provides that he may resign within 10 days prior to the first anniversary of the effective time of the merger and receive the severance payment. The severance payment will be made upon execution of a separation and release agreement that includes customary non-disclosure, non-competition and non-solicitation provisions. The non-competition provisions restrict each executive’s ability to compete with Eastern for the one-year period, and the non-solicitation provisions restrict each executive’s ability to solicit Eastern employees and customers for the two-year period, following the closing of the merger.

Supplemental Executive Retirement and Insurance Plan

Century maintains a Supplemental Executive Retirement and Insurance Plan, or SERP, which provides participating employees a retirement benefit based on compensation and length of service. Upon the closing of the merger, the benefits accrued under the SERP will become fully vested. Eastern intends to assume the SERP. Each of the executive officers participate in the SERP. The accrued benefit for each of Ms. Kay and Mr. Hornby will vest upon consummation of the merger. The accrued benefit for each of Mr. Sloane, Mr. Woonton and Mr. Evangelista was fully vested prior to the date that Century entered into the merger agreement with Eastern.

Split Dollar Agreements

Mr. Sloane and Ms. Kay are each a party to a split dollar life insurance agreement with Century Bank. The split dollar life insurance agreements provide life insurance protection for the executive’s family in the event of

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the executive’s death. The death benefit is $20,000,000 for Mr. Sloane and $10,000,000 for Ms. Kay. The benefit will become fully vested upon the closing of the merger. In connection with the entry into the merger agreement, Mr. Sloane and Ms. Kay entered into amendments to the split dollar life insurance agreements, which will become effective upon the closing of the merger, adding restrictive covenants relating to non-competition and non-solicitation, in each case for a two-year period.

Indemnification and Insurance

Under the merger agreement, Eastern has agreed that all rights to indemnification and all limitations of liability existing in favor of any director or officer of Century, to the fully extent permitted by applicable law, will survive the merger. Eastern will maintain in effect Century’s existing directors’ and officers’ liability insurance coverage for six years following the effective time of the merger, so long as the aggregate cost is not more than 300% of the annual premium currently paid by Century for such insurance.

Short-Term Use of Executive Offices

Eastern has agreed that Mr. Sloane and Ms. Kay may continue to occupy at no cost to them Century’s current executive office suite located at 400 Mystic Avenue, Medford, Massachusetts, from the effective time of the merger through December  31, 2021.

Potential Payments and Benefits to Century’s Named Executive Officers in Connection with the Merger

This section sets forth the information required by Item 402(t) of the SEC’s Regulation S-K regarding compensation for each “named executive officer” of Century that is based on, or otherwise relates to, the merger. This compensation is referred to as “golden parachute” compensation by the applicable SEC disclosure rules, and in this section we use such term to describe the merger-related compensation payable to Century’s named executive officers. The “golden parachute” compensation payable to these individuals is subject to a non-binding, advisory vote of Century’s shareholders, as described below in this section.

The table below sets forth, for the purposes of this golden parachute disclosure, the amount of payments and benefits (on a pre-tax basis) that each of Century’s named executive officers would receive, assuming that (i) the effective time will occur on October 29, 2021 (which is the assumed date solely for purposes of this golden parachute compensation disclosure), (ii) each of Century’s named executive officers will experience a qualifying termination at such time, and (iii) the named executive officer’s base salary rate and the cost of health insurance premiums remain unchanged from those in effect as of the date of this proxy statement. The calculations in the table below do not include amounts Century’s named executive officers were already entitled to receive or vested in as of the date hereof. As a result of the foregoing assumptions, which may or may not actually occur or be accurate on the relevant date, including the assumptions described in the footnotes to the table, the actual amounts, if any, to be received by a named executive officer may materially differ from the amounts set forth below.

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THE MERGER AGREEMENT

The following is a brief summary of the significant provisions of the merger agreement. The summary is not complete and is qualified in its entirety by reference to the merger agreement, which is attached to this proxy statement as Appendix A and is incorporated into this proxy statement by reference. You should read the merger agreement carefully and in its entirety.

Structure of the Merger

The merger agreement provides for the merger of Century with and into Merger Sub. The surviving company in the merger will be Century. Immediately thereafter, Century will merge with and into Eastern. The surviving company in the merger will be Eastern. Immediately thereafter, Century Bank will merge with and into Eastern Bank. The surviving bank in the merger will be Eastern Bank.

Closing of the Merger

The closing of the merger will occur on a date that is no later than five business days after the satisfaction or waiver of all of the closing conditions described in the merger agreement, unless this date is extended by the mutual agreement of the parties. Eastern, in its sole discretion, may elect to extend the closing date by up to 60 days so that the effective time of the merger occurs on the business day immediately preceding the date on which Eastern commences the conversion of Century’s data processing and related electronic informational systems to those used by Eastern. The merger will become effective upon the filing of articles of merger with the Secretary of the Commonwealth of the Commonwealth of Massachusetts.

We currently expect to complete the merger during the fourth quarter of 2021; however, because the merger is subject to a number of conditions, we cannot predict the actual timing of the closing of the merger.

Boards of Directors of the Surviving Bank

Upon completion of the merger, the board of directors of the surviving bank will be the current board of directors of Eastern Bank.

Merger Consideration

Pursuant to the merger agreement, if the merger agreement and the merger are approved by the holders of a majority of the shares of Class A Common Stock outstanding and entitled to vote and Class B Common Stock outstanding and entitled to vote at the special meeting and the merger is subsequently completed, each outstanding share of Class A Common Stock and Class B Common Stock will be exchanged for $115.28, without interest, in cash, plus any dividends declared but unpaid.

Conditions to the Merger

The obligations of the parties to the merger agreement to consummate the merger are subject to the fulfillment of the following conditions:

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In addition, the obligation of Eastern and Merger Sub to complete the merger is subject to the fulfillment or written waiver, where permissible, of the following conditions:

The obligations of Century to complete the merger are subject to the fulfillment or written waiver, where permissible, of the following additional conditions:

“Material adverse effect” when used in reference to Eastern, Century or Century Bank, means any effect, change, event circumstance, condition, occurrence or development, individually or in the aggregate, has had, or would reasonably be likely to have a material adverse effect on (i) the business, prospects, assets, liabilities, prospects, results of operations or financial condition of such party or its subsidiaries, taken as a whole, or (ii) the ability of such party to timely consummate the transactions contemplated by the merger agreement or consummating the transactions provided for in the merger agreement; however, material adverse effect does not include the impact of:

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Under the merger agreement, “pandemic” means any outbreaks, epidemics or pandemics relating to SARS-CoV-2 or COVID-19, or any evolutions or mutations thereof, or any other viruses (including influenza), and the governmental and other responses thereto. The term “pandemic measures” means any quarantine, “shelter in place,” “stay at home,” workforce reduction, social distancing, shut down, closure, sequester or other directives, guidelines or recommendations promulgated by any Governmental Entity, including the Centers for Disease Control and Prevention and the World Health Organization, in each case, in connection with or in response to the Pandemic.

Termination

The merger agreement may be terminated as follows:

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Under the merger agreement, an “acquisition proposal” means any offer, inquiry or proposal (other than an inquiry, offer or proposal from Eastern) relating to, or any third-party indication of interest in:

Termination Fee

Under the terms of the merger agreement, Century must pay Eastern a termination fee of $25,670,000 if:

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Limitations on Considering Other Acquisition Proposals

Century has agreed that neither it nor its subsidiaries nor any of its respective officers, directors, agents, advisers and representatives (which we refer to as Century’s “representatives”) will, directly or indirectly:

If Century receives a bona fide unsolicited written acquisition proposal, Century may furnish or cause to be furnished nonpublic information or data and participate in such negotiations or discussions if:

A “superior proposal” mean a bona fide written acquisition proposal to (i) acquire or purchase, directly or indirectly, 50% or more of Century’s and its subsidiaries’ consolidated assets or 50% or more of any class of

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equity or voting securities of Century or its subsidiaries whose assets, individually or in the aggregate, constitute 50% or more of Century’s consolidated assets, (ii) make a tender offer or exchange offer that, if consummated, would result in such third party beneficially owning 50% or more of any class of equity or voting securities of Century or its subsidiaries whose assets, individually or in the aggregate, constitute 50% or more of Century’s consolidated assets, or (iii) to merge, consolidate, exchange shares or other form of business combination, reorganization or similar transaction involving Century or its subsidiaries whose assets, individually or in the aggregate, constitute 50% or more of Century’s consolidated assets, that Century’s board of directors, after receiving the advice of its outside counsel and, with respect to financial matters, its financial advisors, determines in good faith:

Century has agreed to promptly, and in any event within one business day, advise Century following receipt of any acquisition proposal or any inquiry which could reasonably be expected to lead to an acquisition proposal, and the material terms and conditions of and the identity of the person making such inquiry or acquisition proposal and to keep Eastern reasonably apprised of any related developments, discussions and negotiations on a current basis, including any amendments to or revisions of the material terms of such inquiry or acquisition proposal.

In addition, under the merger agreement, Century agreed to use its reasonable best efforts, subject to applicable law and the fiduciary duties of Century’s board of directors, to enforce any existing confidentiality or standstill agreements to which Century or any of its subsidiaries is a party in accordance with the terms of such agreement. Additionally, Century will not, and shall cause its subsidiaries and its and their representatives to not on its behalf, enter into any letter of intent, memorandum of understanding, agreement in principle, acquisition agreement, merger agreement or other similar agreement (other than a confidentiality agreement referred to above) relating to any acquisition proposal.

However, prior to the date of the special meeting of shareholders, if Century receives an acquisition proposal which has not been withdrawn and Century’s board of directors, after receiving the advice of its outside counsel and, with respect to financial matters, its financial advisors, determines in good faith that it would reasonably be expected to be inconsistent with its fiduciary duties under applicable law to continue to recommend the merger agreement and the merger, then, prior to the receipt to the special meeting of shareholders, in submitting the merger agreement and the merger to its shareholders, Century’s board of directors may:

Century’s board of directors may communicate the basis for its change of recommendation to its shareholders in an appropriate amendment or supplement this proxy statement.

NASDAQ Delisting

Under the terms of the merger agreement, Century will use its reasonable best efforts to take, or cause to be taken, all actions, and do or cause to be done all things, reasonably necessary, proper and advisable to enable the delisting of the Class A Common Stock from the Nasdaq Global Market and the deregistration of the Class A Common Stock under the Exchange Act.

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Indemnification and Insurance

Under the merger agreement, Eastern has agreed to indemnify and hold harmless, to the fullest extent permitted by applicable law, each present and former director, officer or employee of Century or its subsidiaries with respect to matters occurring on or prior to the closing of the merger, including without limitation the right to advancement of expenses.

The merger agreement provides for Eastern to maintain an extended reporting period endorsement under Century’s existing directors’ and officers’ liability insurance coverage. This extended reporting period endorsement will provide Century’s directors and officers with coverage for six years following the closing of the merger of not less than the existing coverage under, and have other terms at least as favorable to the insured persons as, the directors’ and officers’ liability insurance coverage presently maintained by Century so long as the aggregate cost is no more than 300% of the annual premium currently paid by Century for such insurance. In the event that this premium limit is insufficient for such coverage, Century may enter into an agreement to spend up to that amount to purchase such lesser coverage as may be obtained with such amount.

Conduct of Business Pending the Merger

Under the merger agreement, Century has agreed that, until the closing of the merger or the termination of the merger agreement, and except as expressly permitted by the merger agreement, required by law (including the Pandemic Measures (as defined above) or with the prior written consent of Eastern, Century will not, and will cause each of its subsidiaries not to:

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Eastern and Eastern Bank have agreed that, except as permitted by the merger agreement or otherwise consented to by Century in writing, they will not:

The agreements relating to the conduct of Century’s and Eastern’s business contained in the merger agreement are complicated and not easily summarized. You are urged to carefully read Article V of the merger agreement attached to this proxy statement as Appendix A.

Employee Benefits

Under the terms of the merger agreement, for a period of one year after the closing of the merger, Eastern will provide the employees of Century and any of its subsidiaries who remain employed with Eastern annual base salary or base wages (as applicable) at least equal to the level that was provided to each such employee as of immediately prior to the closing of the merger. Eastern has agreed to honor certain agreements, discussed in “Interests of Century Directors and Executive Officers in the Merger,” and to assume Century’s obligations under Century’s defined benefit pension plan. In addition, Eastern will continue to provide retiree medical benefits to certain employees of Century and its subsidiaries on the same terms and conditions as are in effect immediately prior to the closing of the merger, including rights relating to the modification or termination of such retiree medical benefits.

With respect to Century and its subsidiaries employee benefit plans, Eastern had agreed to:

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In addition, Eastern has agreed to, in consultation with Century, designate certain continuing employees to receive retention bonuses to the extent such employee remains an Eastern employee through the closing date of the merger. Eastern and Century do not anticipate paying any retention bonuses to any continuing employee who is a party to an employment or other agreement that provides severance benefits in the event of a change in control of Century.

Employees who remain employed with Eastern after the merger and whose employment is subsequently terminated on or within twelve months after the effective date of the merger and who are not offered a comparable position within Eastern will receive severance pay in a lump sum on the 60^th day following the date of such employee’s termination. The severance pay will be equal to two weeks of the employee’s weekly salary or hourly pay, as applicable, for each of the employee’s years of service with Century, including service to Eastern after the effective time of the merger, with a maximum of 52 weeks. A Century employee with less than one year of service will receive two weeks of severance. Eastern also has agreed to pay, during the severance period, the portion of the cost of continuing health and dental coverage to each terminated employee that is now borne by Century Bank, until the earlier of the employee receiving health and dental insurance through a new employer or the end of the severance period. Eastern’s obligation to pay severance is expressly conditioned on the employee delivering a binding release of claims in favor of Eastern and its affiliates. A Century officer who enters into a change in control agreement will not be entitled to receive the severance payment or healthcare subsidy described in this paragraph.

If requested in writing by Eastern no later than 20 days prior to the closing, Century has agreed to terminate any 401(k) plan sponsored or maintained by Century. In the event that Eastern requests that Century terminate any 401(k) plan, the continuing employees will be eligible to participate, after the closing, in a 401(k) plan sponsored or maintained by Eastern or one of its subsidiaries.

Other Covenants

The merger agreement also contains covenants relating to the preparation and distribution of this proxy statement and all requisite regulatory filings.

Representations and Warranties

The merger agreement contains representations and warranties that Eastern, Merger Sub, Century and Century Bank made solely to each other as of specific dates. Those representations and warranties were made only for purposes of the merger agreement and may be subject to important qualifications and limitations agreed to by the parties, including the schedules referenced in the merger agreement that each party delivered to the other in connection with the execution of the merger agreement. Moreover, some of those representations and warranties may not be accurate or complete as of any specific date, may be subject to a standard of materiality provided for in the merger agreement, or may have been used for the purpose of allocating risk among Eastern, Merger Sub, Century and Century Bank rather than establishing matters as facts. Accordingly, the representations and warranties in the merger agreement should not be relied upon as statements of factual information. Third parties are not entitled to the benefits of the representations and warranties in the merger agreement. The representations and warranties and other provisions of the merger agreement should not be read alone, but instead should be read only in conjunction with the information provided elsewhere in this proxy statement.

The merger agreement contains reciprocal representations and warranties of Eastern, Merger Sub, Century and Century Bank relating to:

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The merger agreement contains additional representations and warranties by Century relating to:

The merger agreement also contains additional representations and warranties by Eastern and its subsidiaries relating to the sufficiency of funds to complete the merger.

None of the representations and warranties by either party survives the closing of the merger. The representations and warranties in the merger agreement are complicated and not easily summarized. You are urged to carefully read Articles III and IV of the merger agreement attached to this proxy statement as Appendix A.

Expenses

Each party will pay all fees and expenses it incurs in connection with the merger agreement and the related transactions.

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Amendments

Eastern, Merger Sub, Century and Century Bank may amend the merger agreement by executing a written amendment. However, after approval of the merger agreement and the merger by the shareholders of Century, no amendment of the merger agreement may be made which by law requires further approval of Century’s shareholders without obtaining that approval.

Regulatory Approvals Required for the Merger

The closing of the merger and the bank merger is subject to the receipt of all approvals and consents required to complete the transactions contemplated by the merger agreement, in each case without the imposition of a materially burdensome regulatory condition, and the expiration of any applicable statutory waiting periods. Eastern has filed all applications and notices and has taken or will take all other appropriate action with respect to any requisite approvals or other action of any governmental authority.

Board of Governors of the Federal Reserve System. Completion of the merger would ordinarily be subject, among other things, to approval by the Federal Reserve Board pursuant to Section 3 of the BHC Act. Under Section 225.12(d)(2) of the Federal Reserve Board’s regulations (12 C.F.R. 225.12(d)(2)), the prior approval of the Federal Reserve Board under the BHC Act is not required in connection with the acquisition by a bank holding company of another bank holding company if the transaction is part of the merger of the bank to be acquired with a subsidiary bank of the acquiring bank holding company, and if the transaction satisfies certain other requirements including that the bank to be acquired not be operated by the bank holding company as a separate entity, and that the transaction requires the prior approval of a federal supervisory agency under the Bank Merger Act.

On May 10, 2021, Eastern requested a determination from the Federal Reserve Board for a waiver contemplated by Section 225.12(d)(2) from an application under Section 3 of the BHC Act. Eastern is unable to predict when or if the Federal Reserve Board will grant the waiver. It is possible that the Federal Reserve Board may determine that an application under Section 3 of the BHC Act is required for the transactions contemplated by the merger agreement upon any material change in the facts presented to the Federal Reserve Board.

FDIC. The bank merger is subject to the approval of the FDIC under the Bank Merger Act. In granting its approval, the FDIC must consider the financial and managerial resources and future prospects of the existing and resulting institutions, the convenience and needs of the communities to be served, competitive factors, any risk to the stability of the United States banking or financial system and the effectiveness of the institutions involved in combating money laundering activities. In addition, a period of 15 to 30 days must expire following approval by the FDIC before completion of the bank merger is allowed, within which period the U.S. Department of Justice may file objections to the merger under the federal antitrust laws. While the parties believe that the likelihood of objection by the Department of Justice is remote in this case, there can be no assurance that the Department of Justice will not initiate proceedings to block the bank merger

Massachusetts Commissioner of Banks. The bank merger is subject to approval by the Commissioner of Banks of the Commonwealth of Massachusetts pursuant to Massachusetts General Laws Chapter 167I, § 3. The Massachusetts Commissioner’s findings with respect to the foregoing are based on a determination as to whether or not competition among banking institutions will be unreasonably affected, and whether or not public convenience and advantage will be promoted. In making such a determination, the Massachusetts Commissioner must consider, but is not limited to considering, a showing of net new benefits. The term “net new benefits,” as defined in MGL Chapter 167I, § 3, means “initial capital investments, job creation plans, consumer and business services, commitments to maintain and open branch offices within the continuing institution’s Community Reinvestment Act assessment area and such other matters as the commissioner may deem necessary or advisable.” Eastern’s applications to the Massachusetts Commissioner will also be subject to requirements for the publication of notice and the opportunity for public comment.

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Under Massachusetts law, the merger of Century Bank with and into Eastern Bank may not be completed until Eastern Bank has made “arrangements satisfactory” to the Massachusetts Housing Partnership Fund to make 0.9% of its assets located in Massachusetts available for call by said fund for a period of ten years for the purpose of financing affordable housing loans. Eastern Bank has requested a letter from the Massachusetts Housing Partnership Fund confirming that Eastern Bank has made such arrangements.

Department of Justice. In addition to the Federal Reserve Board and the FDIC, the Department of Justice (which we refer to as the “DOJ”) conducts a concurrent competitive review of the merger to analyze the merger’s competitive effects and determine whether the merger would result in a violation of the antitrust laws. Transactions approved under the Bank Merger Act generally may not be completed until 30 days after the approval of the applicable federal banking agency is received, during which time the DOJ may challenge the transaction on antitrust grounds. With the approval of the applicable federal banking agency and the concurrence of the DOJ, the waiting period may be reduced to no less than 15 days. The commencement of an antitrust action would stay the effectiveness of such an approval unless a court specifically ordered otherwise. In reviewing the merger, the DOJ could analyze the merger’s effect on competition differently than the FDIC, and thus it is possible that the DOJ could reach a different conclusion than the FDIC regarding the merger’s effects on competition. A determination by the DOJ not to object to the merger may not prevent the filing of antitrust actions by private persons or state attorneys general.

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THE VOTING AGREEMENTS

In connection with the merger agreement, Eastern and Merger Sub entered into voting agreements with certain directors and executive officers of Century, consisting of George R. Baldwin, Stephen R. Delinsky, Paul A. Evangelista, Louis J. Grossman, Russell B. Higley, William P. Hornby; Linda Sloane Kay, Fraser Lemley, Barry R. Sloane and David B. Woonton, and Sloane Family Enterprises, Limited Partnership. As of the record date, there are 90,581 shares of Class A Common Stock subject to the voting agreements, which represents approximately 2.48% of the outstanding shares of Class A Common Stock and 1,781,841 shares of Class B Common Stock subject to voting agreements, which represents approximately 93.32% of the outstanding shares of Class B Common Stock, as of the record date.

In the voting agreements, each of these shareholders has agreed to vote all of his, her or its shares of Class A Common Stock and/or Class B Common Stock (including any shares acquired after the date of the voting agreement, whether by the purchase in the open market, privately or otherwise):

Under the voting agreements, each of the shareholders also agreed not to, and not to permit any of his, her or its affiliates, to:

In addition, except under limited circumstances, these shareholders also agreed not to sell, assign, transfer or otherwise dispose of or encumber their shares of Century Class A Common Stock and/or Class B Common Stock while the voting agreement are in effect. The voting agreements terminate immediately upon the earlier of the closing of the merger, the termination of the merger agreement in accordance with its terms, an amendment to the merger agreement that decreases the merger consideration, or mutual written agreement of Eastern, Merger Sub and the shareholder.

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MATERIAL FEDERAL INCOME TAX CONSEQUENCES

The following is a general summary of material United States federal income tax consequences of the merger of Eastern and Century to U.S. holders of Class A Common Stock and/or Class B Common Stock. The federal income tax laws are complex and the tax consequences of the merger may vary depending upon each shareholder’s individual circumstances or tax status. The following discussion is based upon current provisions of the Internal Revenue Code of 1986, as amended, or the “Code,” existing temporary and final regulations under the Code and current administrative rulings and court decisions, all of which are subject to change, possibly on a retroactive basis. Any such change could affect the validity of this discussion. No attempt has been made to comment on all United States federal income tax consequences of the merger that may be relevant to Century’s shareholders. The tax discussion set forth below is included for general information only. It is not intended to be, nor should it be construed to be, legal or tax advice to a particular Century shareholder.

The following discussion may not apply to particular categories of holders of shares of Class A Common Stock and/or Class B Common Stock in light of their individual circumstances or to holders that are subject to special treatment under the Code, such as:

This discussion assumes that holders of shares of Class A Common Stock and/or Class B Common Stock hold their shares as capital assets within the meaning of section 1221 of the Code. The following discussion does not address state, local or foreign tax consequences of the merger. You are urged to consult your tax advisors to determine the specific tax consequences of the merger, including any state, local or foreign tax consequences of the merger.

For purposes of this discussion, the term “U.S. holder” means a beneficial owner of Class A Common Stock and/or Class B Common Stock that is:

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ALL HOLDERS OF CLASS A COMMON STOCK AND/OR CLASS B COMMON STOCK SHOULD CONSULT THEIR TAX ADVISORS AS TO THE SPECIFIC TAX CONSEQUENCES TO THEM OF THE MERGER, INCLUDING THE APPLICABILITY AND EFFECT OF THE ALTERNATIVE MINIMUM TAX AND ANY STATE, LOCAL, FOREIGN, AND OTHER TAX LAWS.

Tax Consequences of the Merger

The merger is expected to be treated for U.S. federal income tax purposes as a purchase by Eastern of all of the outstanding shares of Class A Common Stock and Class B Common Stock. Neither Eastern nor Century are expected to recognize any taxable income, gain or loss as a result of the merger.

Receipt of Cash

Century shareholders will receive cash in exchange for shares of Class A Common Stock and Class B Stock pursuant to the merger and generally will recognize capital gain or loss in an amount equal to the difference between the amount of cash received and the shareholder’s aggregate tax basis for such shares of Class A Common Stock and/or Class B Common Stock, which gain or loss generally will be long-term capital gain or loss if such shares of Class A Common Stock and/or Class B Common Stock were held for more than one year. U.S. holders that are individuals or estates or trusts that do not fall into a special class of trusts that is exempt from such tax may be subject to an additional 3.8% tax, generally referred to as the “Medicare tax” or “NIIT.” If you are a U.S. holder that is an individual, estate, or trust, please consult your tax advisors regarding the applicability of the Medicare tax with respect to your disposition of shares of Class A Common Stock and/or Class B Common Stock pursuant to the merger.

Information Reporting and Backup Withholding

Cash payments received in the merger by a U.S. holder may, under certain circumstances, be subject to information reporting and backup withholding, unless the holder provides proof of an applicable exemption or furnishes its taxpayer identification number, and otherwise complies with all applicable requirements of the backup withholding rules.

If withholding results in an overpayment of taxes, a refund or credit against a Century shareholder’s United States federal income tax liability may be obtained from the IRS, provided the shareholder furnishes the required information to the IRS. A holder that does not furnish a correct taxpayer identification number may be subject to penalties imposed by the IRS.

Other Tax Consequences

The state and local tax treatment of the merger may not conform to the federal income tax consequences discussed above. Consequently, you should consult your own tax advisors regarding the treatment of the merger under state and local tax laws.

The preceding discussion is intended only as a general discussion of material U.S. federal income tax consequences of the merger. It is not a complete analysis or discussion of all potential tax effects that may be important to you. Thus, you are strongly encouraged to consult your tax advisor as to the specific tax consequences resulting from the merger, including tax return reporting requirements, the applicability and effect of federal, state, local, and other tax laws, and the effect of any proposed changes in tax laws.

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SECURITY OWNERSHIP OF CENTURY BENEFICIAL OWNERS AND MANAGEMENT AND RELATED SHAREHOLDER MATTERS

The following table sets forth certain information as to the number and percentage of shares of Class A and Class B Common Stock beneficially owned as of May 27, 2021, (i) by each person known by Century to own beneficially more than 5% of Century’s outstanding shares of Class A or Class B Common Stock, (ii) by each of Century’s directors and executive officers; and (iii) by all directors and executive officers as a group. As of May 27, 2021, there were 3,658,569 shares of Class A Common Stock and 1,909,340 shares of Class B Common Stock outstanding.

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WHERE YOU CAN FIND MORE INFORMATION

Century is subject to the informational requirements of the Securities Exchange Act of 1934, as amended and files reports, proxy statements and other information with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended. The SEC maintains an internet website that contains reports, proxy and information statements and other information about issuers, like Century, that file electronically with the SEC. The address of the site is www.sec.gov. The reports and other information filed by Century with the SEC are also available at Century’s internet worldwide web site: www.centurybank.com.

The SEC allows us to “incorporate by reference” information into this proxy statement, which means that we can disclose important information to you by referring to other documents filed separately with the SEC. The information incorporated by reference is deemed to be part of this proxy statement, except for any information superseded by information in this proxy statement or incorporated by reference subsequent to the date of this proxy statement. This proxy statement incorporates by reference the documents set forth below that we have previously filed with the SEC. We also incorporate by reference into this proxy statement additional documents that Century may file with the SEC under Section 13(a), 13(c), 14 or 15(d) of the Exchange Act, from the date of this proxy statement until the date of the special meeting; provided, however, that we are not incorporating by reference any additional documents or information furnished and not filed with the SEC. These documents contain important information about us and our financial condition and are incorporated by reference into this proxy statement.

The following Century filings with the SEC are incorporated by reference (in each case excluding any information furnished and not filed):

Statements contained in this proxy statement regarding the contents of any contract or other document, are not necessarily complete and each such statement is qualified in its entirety by reference to that contract or other document filed as an exhibit with the SEC.

The information contained in this proxy statement speaks only as of the date indicated on the cover of this proxy statement unless the information specifically indicates that another date applies.

No persons have been authorized to give any information or to make any representations other than those contained in this proxy statement and, if given or made, the information or representations must not be relied upon as having been authorized by Century or any other person. This proxy statement is dated June 3, 2021. You should not assume that the information contained in this proxy statement is accurate as of any date other than that date, and the mailing of this proxy statement to shareholders will not create any implication to the contrary.

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Appendix A

AGREEMENT AND PLAN OF MERGER

by and among

EASTERN BANKSHARES, INC.,

CLARION ACQUISITION CORP.,

CENTURY BANCORP, INC.

and

CENTURY BANK AND TRUST COMPANY

Dated as of April 7, 2021

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