**EXHIBIT 10.17**

 

**A****BINGTON****B****ANCORP****, I****NC****.**

 

**F****ORMER****D****IRECTOR****A****DVISORY****B****OARD****S****ERVICE****P****LAN**

 

It is the purpose of thisPlan to encourage Directors who have made significant contributions to AbingtonBancorp, Inc. (the “Holding Company”) and to Abington Savings Bank (the “Bank”)to consider voluntarily transitioning off the Boards of Directors in order toprovide opportunities for increased diversity on the Boards and generally topermit others to serve on the Boards, while at the same time preserving for thebenefit of the Holding Company and the Bank the benefit of the knowledge,business judgment and business contacts that the former Directors can continueto provide to each of the Bank and the Holding Company.

 

**Part 1.    DEFINITIONS**

 

The following terms are usedin this Plan with the meanings set forth below:

 

1.1. **Advisory Board Service Period** shall meanthe period of time during which the Director remains an active member of theFormer Director Advisory Board (as provided in Section 3.2) and shall terminateon the earliest to occur of (a) the date on which the Director shall havereceived Plan Compensation under this Plan for an aggregate of eight (8) years,if the Director is receiving Plan Compensation pursuant to Section 2.2 (or four(4) years, if the Director is receiving Plan Compensation pursuant to Section2.3); (b) the date on which the Director ceases to serve as an active member ofthe Former Director Advisory Board (as provided in Section 3.2); (c) any dateon which the Director ceases to be in compliance with the provisions of Section3.3 or Section 3.4; and (d) as provided in Section 2.6.

 

1.2. **Annual Plan Compensation**shall becalculated as follows:

 

(a) Except as provided inSection 1.2(b), if the Director terminates his or her service as a Director afterattaining the age of seventy (70), the Annual Plan Compensation shall be anamount equal to the Director’s Fee Income for the calendar year prior to theDirector’s attaining the age of seventy (70);

 

(b) If (x) the Directorterminates service as a Director prior to age seventy (70) or (y) if aGrandfathered Director terminates service as a Director before December 30,2003, the Annual Plan Compensation shall be an amount equal to the Director’sFee Income for the calendar year prior to the calendar year in which theDirector’s Termination of Service as a Director occurred.

 

1.3. **Bank** shall mean Abington Savings Bank, asavings bank in stock form organized and existing under the laws of TheCommonwealth of Massachusetts.

 

1.4. **Change in Control**.  A “Change in Control” shall be deemed tohave occurred in any of the following events:

 

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(a) if there has occurred achange in control which the Holding Company would be required to report inresponse to Item 1 of Form 8-K promulgated under the Securities Exchange Act of1934, as amended (the “1934 Act”), or, if such Form 8-K is no longer in effectin its present form, any form or regulation promulgated by the Securities andExchange Commission pursuant to the 1934 Act which is intended to serve similarpurposes; or

 

(b) when any “person” (assuch 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 the1934 Act), directly or indirectly, of securities of the Holding Company or theBank representing twenty-five percent (25%) or more of the total number ofvotes that may be cast for the election of Directors of the Holding Company orthe Bank; or

 

(c) if during any period oftwo consecutive years (not including any period prior to the adoption of thisPlan), individuals who are Continuing Directors (as herein defined) cease forany reason to constitute at least a majority of the Board of Directors of theHolding Company.  For this purpose, a“Continuing Director” shall mean (i) an individual who was a Director of theHolding Company at the beginning of such period or (ii) any new Director (otherthan a director designated by a person who has entered into any agreement withthe Holding Company to effect a transaction described in Section 1.4(a) orSection 1.4(b) whose election by the Board or nomination for election by theHolding 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 beginningof such period or whose election or nomination for election was previously soapproved; or

 

(d) the stockholders of theHolding Company approve a merger or consolidation of the Holding Company withany other bank or corporation, other than (i) a merger or consolidation whichwould result in the voting securities of the Holding Company outstandingimmediately prior thereto continuing to represent (either by remainingoutstanding or by being converted into voting securities of the survivingentity) more than fifty-five percent (55%) of the combined voting power of thevoting securities of the Holding Company or such surviving entity outstandingimmediately after such merger or consolidation, or (ii) a merger orconsolidation effected to implement a recapitalization of the Holding Company(or similar transaction) in which no “person” (as defined above in Section1.4(b)) acquires more than thirty percent (30%) of the combined voting power ofthe Holding Company’s then outstanding securities; or

 

(e) the stockholders of theHolding Company approve a plan of complete liquidation of the Holding Companyor an agreement for the sale or disposition by the Holding Company of all orsubstantially all of its assets.

 

1.5. **Effective Date** of the Plan shall mean November1, 2002.

 

1.6. **Fee Income** shall mean the averageper-person compensation paid to (or deferred for) all Directors in a calendaryear for fulfilling their duties as a Director.  Fee Income does not include amounts paid in reimbursement of expensesor the value of any benefits provided to Directors.

 

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1.7. **Grandfathered Director** shall mean aDirector who was serving as a Director as of the Effective Date and who wasover seventy (70) years of age as of the Effective Date.

 

1.8. **Holding Company** shall mean AbingtonBancorp, Inc., a bank holding company organized and existing under the laws ofThe Commonwealth of Massachusetts.  TheHolding Company is the parent company of the Bank.

 

1.9. **Payment Commencement Date**shall mean theJanuary 1 next following a Director’s Plan Eligibility Date (except as may beotherwise determined pursuant to Section 2.4).

 

1.10. **Plan** shall mean the terms, conditions andbenefits provided by this document and any amendment or restatement of thisdocument.

 

1.11. **Plan Compensation** shall mean the benefit towhich a Director would be entitled under Section 2.2 or Section 2.3 of thisPlan.

 

1.12. **Plan Eligibility Date** shall mean the laterto occur of (a) the date on which the Director has accumulated fifteen (15)Years of Service as a Director and (b) the date on which the Director ceases toserve as a Director.

 

1.13. **Specially-Defined Cause** shall mean theDirector’s deliberate dishonesty with respect to the Bank, the Holding Companyor any subsidiary or affiliate thereof, or conviction of a crime related tobanking activity.

 

1.14. **Termination of Service as a Director** shallmean termination of services as a Director for any reason other than death,disability or Specially-Defined Cause.

 

1.15. **Years of Service** shall mean the number ofyears a Director has served as a Director of the Bank or the Holding Company(or of both), whether before or after the Effective Date of the Plan.  A person who is serving as a Director shallnot receive additional service credit by reason of his or her servingsimultaneously as a Director of both the Bank and the Holding Company.  No credit shall be awarded for service as adirector of an entity acquired by the Bank or the Holding Company.

 

**Part 2.****                         ****ELIGIBILITY AND BENEFITS**

 

2.1. **Eligibility.**  Any person who is a Director as of the Effective Date of the Planshall be eligible to participate in the Plan immediately.  Any person elected as a Director subsequentto the Effective Date of the Plan shall be eligible to participate in the Planas of the first day of the calendar month next following the date of his or herelection as a Director.  No Directorshall be eligible to receive any benefits under this Plan until the Directorshall have signed a form of Acceptance of Plan Terms as provided in Section4.4.  A person who is compensated as anemployee of the Bank or the Holding Company shall not, for such period of timeas he or she receives such compensation, be considered to be a “Director”hereunder and shall not earn or receive any benefits under this Plan.

 

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2.2. **Full Plan Compensation.**  Upon Termination of Service as a Director, aDirector who has completed twenty (20) Years of Service as of the date of Terminationof Service as a Director (and has not been terminated for Specially-DefinedCause) shall be entitled to receive an amount equal to the Annual PlanCompensation, payable annually during the Advisory Board Service Period.  As provided in each of Sections 1.1 and 3.2,payment of the Annual Plan Compensation is explicitly conditioned uponcontinued active participation by the Director in the Former Director AdvisoryBoard.  Subject to the provisions ofSection 2.4, payment of this benefit shall commence on the then-applicablePayment Commencement Date.

 

2.3. **Plan Compensation — Less Than Twenty (20) Years ofService.**  Upon Termination ofService as a Director, a Director who has completed at least fifteen (15) butless than twenty (20) Years of Service as of the date of Termination of Serviceas a Director (and has not been terminated for Specially-Defined Cause) shallreceive an amount equal to the Annual Plan Compensation, payable annuallyduring the Advisory Board Service Period. As provided in each of Sections 1.1 and 3.2, payment of the Annual PlanCompensation is explicitly conditioned upon continued active participation bythe Director in the Former Director Advisory Board.  Subject to the provisions of Section 2.4, payment of this benefitshall commence on the then-applicable Payment Commencement Date.

 

2.4. **Limitation on Number of Persons Commencing to ReceivePlan Compensation in any Calendar Year.**  This Plan is not intended to permit more than two Directors tocommence receiving Plan Compensation in any calendar year.  In the event that more than two Directorsbecome eligible to receive Plan Compensation on any Payment Commencement Date,payment shall be made to the two Directors with the greatest number of Years ofService.  A Director whose PlanCompensation is deferred pursuant to the provisions of this Section 2.4 shallbecome eligible to commence receiving his or her Plan Compensation on theJanuary 1 next following the original Payment Commencement Date, subject to thesame rules of priority based upon Years of Service in the event that on suchsubsequent Payment Commencement Date more than two Directors would be eligibleto commence receiving Plan Compensation.

 

2.5. **No Plan Compensation with Less than 15 Years ofService.**  Notwithstanding anyother provision hereof, a Director who has not completed fifteen (15) Years ofService as of the date of Termination of Service as a Director shall notreceive any Plan Compensation under this Plan.

 

2.6. **Termination of Plan and Benefits**.

 

(a) **Termination of Plan Compensation at Age 78. **Notwithstanding any otherprovision hereof, all payments of the Plan Compensation shall terminateimmediately when the Director attains the age of seventy-eight (78).  However, Grandfathered Directors who retirenot later than December 30, 2003 shall be exempt from this Section (a).

 

(b) **Termination of Plan Compensation Upon Death. **Notwithstanding any otherprovision hereof, all payments of the Plan Compensation shall terminateimmediately upon the death of the Director.

 

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(c) **Termination of Plan Compensation Upon Failure toContinue to Serve as Active Participant in Former Director Advisory Board. **Notwithstanding any otherprovision hereof, all payments of the Plan Compensation shall terminateimmediately upon the failure of the Director to be an active participant in theFormer Director Advisory Board, as provided in each of Sections 1.1 and 3.2.

 

(d) **Termination for Specially-Defined Cause.**  Notwithstanding any other provision hereof,in the event a Director’s service as a Director is terminated forSpecially-Defined Cause, the Director shall not be entitled to become a memberof the Former Director Advisory board or earn any Plan Compensation under thisPlan.

 

(e) **Termination of Plan and Plan Compensation Upon Changein Control.**  Notwithstandingany other provision hereof, from and after the occurrence of a Change inControl, this Plan and all payments of the Plan Compensation shall terminateimmediately.

 

2.7. **Non-Transferability of Plan Compensation. **The payment or right to paymentof any Plan Compensation (and any interest therein) is a personal benefit tothe Director and cannot be sold, assigned, pledged or otherwise transferred toa third party at any time or under any circumstances.  Notwithstanding any other provision hereof, in the event aDirector attempts to sell, assign, pledge or otherwise transfer his or her PlanCompensation under the Plan (and any interest therein), such Plan Compensationshall terminate immediately.

 

2.8. **Increase in Number of Plan Compensation to Commence inany Calendar Year.**  If at anytime more than two Directors would be scheduled to receive Plan Compensation onany Payment Commencement Date, a Director whose Plan Compensation was scheduledto be deferred pursuant to the provisions of Section 2.4 may request that theBoard of Directors of the Holding Company increase the number of Directorspermitted to commence receiving Plan Compensation in any calendar year topermit commencement of payment of his or her Plan Compensation on the PaymentCommencement Date.  If the Board ofDirectors of the Holding Company, acting by the unanimous affirmative vote ofall Continuing Directors then in office, approves such a request, the paymentof the Plan Compensation shall commence on the Payment Commencement Date.  The Board of Directors shall have noobligation to approve any such request.

 

**Part 3.****                         ****FORMER DIRECTOR ADVISORY BOARD**

 

3.1. **Creation of Former Director Advisory Board.**  The Bank and the Holding Company haveestablished a Former Director Advisory Board. The purpose of the Former Director Advisory Board shall be to provide aforum for former Directors and others to give feedback to the Bank and theHolding Company as to market conditions, marketing opportunities, communityinput and business judgment.

 

3.2. **Participation in Former Director Advisory BoardActivities.**  Former Directorswill be required to perform the following duties:

 

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•                  Assist the SVP/BusinessBanking in the development of new business by making joint calls with loanofficers at least one day per month and by providing customer referralsregularly;

 

•                  Assist the CEO and SeniorManagement by providing support and local community feedback  at least quarterly;

 

•                  Assist the CEO and SeniorManagement by participating in quarterly customer focus group meetings with keycustomers and prospects; and

 

•                  Assist the CEO as needed toprovide advice, counsel and support regarding governance matters, new Boardmember prospects and other issues as they arise.

 

3.3. **Non-Competition.**  During the Advisory Board Service Period, no Director shallcompete with the Bank or the Holding Company. The Director will not, directly or indirectly, (i) become a director,officer, employee, principal, agent, consultant or independent contractor ofany insured depository institution, trust company or parent holding company ofany such institution or company which has an office in Massachusetts (a “CompetingBusiness”), provided, however, that this provision shall not prohibit theDirector from (x) owning bonds, non-voting preferred stock or up to fivepercent (5%) of the outstanding common stock of any such entity if such commonstock is publicly traded and (y) being employed outside of Massachusetts aslong as he or she is in compliance with the provisions of clauses (ii) and(iii) below; (ii) solicit or induce, or cause others to solicit or induce, anyemployee of the Holding Company or any of its subsidiaries to leave theemployment of such entities; or (iii) solicit any customer of the HoldingCompany or any of its subsidiaries to transact business with any other entity,whether or not a Competing Business, or to reduce or refrain from doing anybusiness with the Holding Company or its subsidiaries.

 

3.4. **Confidentiality.**  Except as required by law or regulation, the Director shall keepsecret and confidential and shall not disclose to any third party (other thanthe Holding Company or its subsidiaries) in any fashion or for any purposewhatsoever any information regarding the Holding Company or any of itssubsidiaries which is not available to the general public to which he or shehas had or will have access at any time during the course of his or her relationshipwith the Holding Company or its subsidiaries. This restriction shall not apply to information made available to thepublic by the Holding Company and information which is already in the publicdomain through no breach of this Plan by the Director.

 

**Part 4.****                         ****ADDITIONAL PROVISIONS**

 

4.1. **Plan Amendment or Termination.**  This Plan may be amended or terminated by atwo-thirds (2/3) vote of all Directors of the Holding Company.

 

4.2. **Applicable Law.**  This Plan shall be governed and construed in accordance with thelaws of The Commonwealth of Massachusetts.

 

4.3. **Effect on Other Plans and Agreements.**  This Plan constitutes the entire agreementof the parties relating to the subject matter hereof, and shall supersede inits entirety any and all prior agreements or understandings, whether written ororal, between or among the parties relating to the subject matter hereof,including without limitation the Board of Directors Transition and RetirementPlan dated June 22, 2000.  No party hasrelied upon any representation or promise except those set forth herein.

 

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4.4. **Acceptance of Terms of Plan.**  To become eligible for the benefits to beprovided under this Plan, a Director must have signed a form of Acceptance ofPlan Terms in substantially the form set forth at the end hereof.

 

IN WITNESS THEREOF, theHolding Company has caused this Plan to be executed by its duly authorizedofficer effective as of the day and year first written (the Effective Date).

 
|   | **A****BINGTON****B****ANCORP****, I****NC****.** |
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|   | By:                                               |   |
|   |                                              | President and Chief Executive Officer |
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|   | Date:                                             |   |
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Acceptance of Plan Terms

 

The undersigned herebyaccepts and agrees to the terms and conditions of the foregoing Former DirectorAdvisory Board Service Plan.

 
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