Exhibit 10.8
Director Recognition and Retirement Plan
This Director Recognition and Retirement Plan (the "Plan") is adopted by
Ipswich Savings Bank, (the "Bank") as of the 18th day of May, 1999.
WHEREAS, the Bank desires to recognize the valuable services its
Directors have performed and will continue to perform for the Bank;
WHEREAS, the Bank also desires to provide for future growth and
expansion of the Bank by being in a position to attract additional, qualified
individuals to serve as Directors of the Bank and by providing to its Directors
additional financial flexibility that will enable them, under appropriate
circumstances, to consider retiring from or rotating off the Board of Directors
so as to permit others to have the opportunity to serve as members of the Board;
NOW, THEREFORE, the Board hereby adopts the following Director
Recognition and Retirement Plan:
1 . Applicability. The Plan shall apply to all persons who serve as
Directors of the Bank during any period in which the Plan is in effect. It shall
not apply to persons who ceased to serve as Directors of the Bank before the
date of Plan adoption.
2 . Recognition and Retirement Benefit. Except to the extent otherwise
provided in Section , if a Director should at any time cease to serve as a
member of the Board of Directors of the Bank for any reason, the Bank will
immediately pay to the Director (or to the Director's estate, if applicable) in
one lump sum an amount equal to two times the highest annual aggregate
compensation paid to or for the benefit of the Director for his or her service
on the Board during the then most recently concluded three calendar years.
3 . Removal for Cause. No Director shall receive any payment under this
Plan if he or she is removed from the Board of Directors for cause in accordance
with the procedures set forth in the Bank's By-Laws.
4 . Employment Status. This Plan is not an agreement for the employment
of a Director and shall confer no rights on a Director except as herein
expressly provided.
5 . Withholding. All payments made by the Bank under this Plan shall be
net of any tax or other amounts required to be withheld by the Bank under
applicable Federal and state law.
6 . Governing Law. This Plan shall be construed in accordance with, and
governed for all purposes by the laws of The Commonwealth of Massachusetts,
without regard to its principles of conflicts of laws.
7 . Enforcement. In the event that any action is instituted by a former
Director under this Plan to enforce or interpret any of the terms hereof, such
former Director shall be entitled to be paid all costs and expenses, including
reasonable attorneys' fees, incurred by such former Director with respect to
such action, unless as a part of such action, a court of competent jurisdiction
determines that each of the material assertions made by the former Director as a
basis for such action was not made in good faith or was frivolous.
8 . Establishment of a Holding Company. The stockholders of the Bank
have approved the formation of a holding company (the "Holding Company") for the
Bank ("Holding Company Reorganization"). Once established, the Holding Company
will be the sole stockholder of the Bank. This Plan shall become a plan and
obligation of the Holding Company as of the time the Holding Company becomes the
sole stockholder of the Bank. At that time all references to the "Bank" (other
than references in Section ) in this Plan shall become references to the
"Holding Company." Ceasing to serve as a Director of the Bank while continuing
to serve as a Director of the Holding Company shall not be a basis for payment
under this Plan. Notwithstanding any other provision of this Plan, the Holding
Company Reorganization shall not constitute a Change in Control (as defined in
Section 10).
9 . Amendment; Termination. This Plan may be amended or terminated at
any time by a vote of the Board of Directors until such time as a Change in
Control (as defined in Section ) shall have occurred. During the two year period
following a Change in Control, this Plan may not be terminated or amended in any
way that might limit amounts payable to any Director or former Director.
10 . Change in Control. Except to the extent otherwise provided in
Section , for the purposes of this Plan "Change in Control" shall mean the
occurrence of any one or more of the following five events:
10.1 If there has occurred a change in control which the Bank or
Holding Company would be required to report in response to Item 1 of Form 8-K
promulgated under the Securities Exchange Act of 1934, as amended (the "1934
Act"), or, if such regulation is no longer in effect, any regulations
promulgated by the Securities and Exchange Commission pursuant to the 1934 Act
which are intended to serve similar purposes;
10.2 When any "person" (as such term is used in Sections 13(d) and
14(d)(2) of the 1934 Act) becomes a "beneficial owner" (as such term is defined
in Rule 13d-3 promulgated under the 1934 Act), directly or indirectly, of
securities of the Holding Company or the Bank representing twenty-five percent
(25%) or more of the total number of votes that may be cast for the election of
directors of the Holding Company or the Bank, as the case may be;
10.3 During any period of two consecutive years, individuals who at
the beginning of such period constitute the Board of Directors of the Holding
Company, and any new director (other than a director designated by a person who
has entered into an agreement with the Holding Company to effect a transaction
described in Section 10.2, 10.4, or 10.5 of this Plan) whose election by the
Board or nomination for election by the Holding Company's stockholders was
approved by a vote of at least two-thirds (2/3) of the directors then still in
office who either were directors at the beginning of the period or whose
election or nomination for election was previously so approved, cease for any
reason to constitute at least a majority of the Board of Directors of the
Holding Company;
10.4 The stockholders of the Holding Company approve a merger, share
exchange or consolidation ("merger or consolidation") of the Holding Company
with any other corporation, other than (a) a merger or consolidation which would
result in the voting securities of the Holding Company outstanding immediately
prior thereto continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity) more than 70% of
the combined voting power of the voting securities of the Holding Company or
such surviving entity outstanding immediately after such merger or consolidation
or (b) a merger or consolidation effected to implement a recapitalization of the
Holding Company (or similar transaction) in which no "person" (as hereinabove
defined) acquires more than 30% of the combined voting power of the Holding
Company's then outstanding securities; or
10.5 The stockholders of the Holding Company or the Bank approve a
plan of complete liquidation of the Holding Company or the Bank or an agreement
for the sale or disposition by the Holding Company or the Bank of all or
substantially all of the Holding Company's or the Bank's assets.
11 . Binding Effect. This Plan shall be binding on the successors and
assigns of the parties hereto.