BYLAWS
OF
SANDY SPRING BANCORP, INC.
ARTICLE I
Principal Office
The principal office of Sandy Spring Bancorp, Inc. (herein the “Corporation”) shall be at 17801 Georgia Avenue, Olney, Maryland, 20832.
ARTICLE II
Meetings of Shareholders
SECTION 1. Place of Meetings. All meetings of shareholders shall be held at such place within or without the State of Maryland or by means of remote communication as the Board of Directors may determine and as designated in the notice of such meeting.
SECTION 2. Annual Meeting. A meeting of the shareholders of the Corporation for the election of directors and for the transaction of any other business of the Corporation shall be held annually at such date and time as the Board of Directors may determine.
SECTION 3. Special Meetings. Special meetings of the shareholders for any purpose or purposes may be called at any time only (i) by the Chief Executive Officer, the Chair of the Board of Directors, or the Board of Directors in accordance with the provisions of the Corporation’s Articles of Incorporation, or (ii) by the Secretary of the Corporation upon the written request of the holders of not less than twenty-five percent (25%) of all votes entitled to be cast at the meeting. Such written request shall state the purpose or purposes of the meeting and the matters proposed to be acted on at the meeting and shall be delivered at the principal office of the Corporation addressed to the Chair of the Board of Directors, the Chief Executive Officer or the Secretary. The Secretary shall inform the shareholders who make the request of the reasonably estimated costs of preparing and mailing a notice of the meeting and, upon payment of these costs to the Corporation, the Secretary shall then notify each shareholder entitled to notice of the meeting.
SECTION 4. Conduct of Meetings. Annual and special meetings shall be conducted in accordance with the rules and procedures established by the Board of Directors. The Board of Directors shall designate, when present, either the Chair of the Board of Directors or the Chief Executive Officer to preside at such meetings.
SECTION 5. Notice of Meeting. Not less than ten (10) nor more than ninety (90) days before each shareholders’ meeting, the Secretary of the Corporation shall give, or cause to be given, notice in writing or by electronic transmission of the meeting to each shareholder entitled to vote at the meeting and each other shareholder entitled to notice of the meeting. The notice shall state (i) the time of the meeting, the place of the meeting, if any, and the means of remote communication, if any, by which shareholders and proxy holders may be deemed to be present in person and may vote at the meeting; and (ii) the purpose of the meeting, if the meeting is a special meeting or notice of the purpose is required by any other provision of the Maryland General Corporation Law.
Any notice given to a shareholder is effective if given by a single notice in writing or by electronic transmission to all shareholders who share an address unless the Corporation has received a request from a shareholder in writing or by electronic transmission that a single notice not be given. If a shareholder be present at a meeting, or in writing waives notice thereof before or after the meeting and such waiver is filed with the records of the meeting of shareholders, notice of the meeting to such shareholder shall be unnecessary.
A meeting of shareholders convened on the date for which it was called may be adjourned from time to time without further notice to a date not more than one hundred twenty (120) days after the original record date. It shall not be necessary to give any notice of the time and place of any meeting adjourned to a date not more than one hundred twenty (120) days after the original record date or of the business to be transacted at such adjourned meeting, other than an announcement at the meeting at which such adjournment is taken.
SECTION 6. Fixing of Record Date. For the purpose of determining the shareholders entitled to notice of or to vote at any meeting of shareholders, or any adjournment thereof, or shareholders entitled to receive payment of any dividend, or in order to make a determination of shareholders for any other proper purpose, the Board of Directors shall fix in advance a date as the record date for any such determination of shareholders. Such date in any case shall be not more than ninety (90) days and, in case of a meeting of shareholders, not less than ten (10) days prior to the date on which the particular action, requiring such determination of shareholders, is to be taken. When a determination of shareholders entitled to vote at any meeting of shareholders has been made as provided in this section, such determination shall apply to any adjournment thereof.
SECTION 7. Quorum. Unless otherwise provided in the Corporation’s Articles of Incorporation, a majority of all votes entitled to be cast at the meeting, represented in person or by proxy, shall constitute a quorum at a meeting of shareholders. If less than a majority of all votes entitled to be cast at the meeting are represented at the meeting, a majority of the shares so represented may adjourn the meeting from time to time without further notice. At such adjourned meeting at which a quorum shall be present or represented, any business may be transacted which might have been transacted at the meeting as originally notified. The shareholders present at a duly organized meeting may continue to transact business until adjournment, notwithstanding the withdrawal of enough shareholders to leave less than a quorum.
SECTION 8. Proxies. Each shareholder entitled to vote at a meeting of shareholders may authorize another person to act for such shareholder by proxy. A shareholder may authorize another person to act as proxy by transmitting, or authorizing the transmission of, an authorization for the person to act as proxy to the person who will be authorized to act as proxy or to any other person authorized to receive the proxy authorization on behalf of the person authorized to act as the proxy, including a proxy solicitation firm or proxy support service organization. A copy, facsimile transmission, or other reliable reproduction of the writing or transmission authorized by this section may be substituted for the original writing or transmission for any purpose for which the original writing or transmission could be used. Proxies solicited on behalf of the management shall be voted as directed by the shareholder or, in the absence of such direction, as determined by a majority of the Board of Directors. No proxy shall be valid after eleven (11) months from the date of its execution, unless otherwise provided in the proxy.
SECTION 9. Voting. Unless the Corporation’s Articles of Incorporation provides for a greater or lesser number of votes per share or limits or denies voting rights, each outstanding share of stock, regardless of class, is entitled to one vote on each matter submitted to a vote at a meeting of shareholders. Unless otherwise provided by the Corporation’s Articles of Incorporation, these Bylaws, or the Maryland General Corporation Law, a majority of all votes cast at a meeting at which a quorum is present shall be sufficient to approve any matter that properly comes before the meeting.
The vote required for election of a director by the shareholders shall, except in a contested election, be the affirmative vote of a majority of the votes cast with respect to the director. For purposes of this Section 9, a “majority of the votes cast” shall mean that the number of votes cast “for” a director's election exceeds the number of votes cast “against” that director's election, with “abstentions” and “broker nonvotes” not counted as votes cast either “for” or “against” that director's election. In a contested election, directors shall be elected by a plurality of the votes cast at a meeting of shareholders by the holders of shares present in person or by proxy at the meeting and entitled to vote in the election. An election shall be considered contested if (a) the Secretary of the Corporation receives a notice that a shareholder has nominated a person for election to the Board of Directors in compliance with the advance notice requirements for shareholder nominees for director set forth in Article II, Section 13 of these Bylaws and (b) such nomination has not been withdrawn by such shareholder on or before the tenth day before the Corporation first mails its notice of meeting for such meeting to the shareholders. If directors are to be elected by a plurality of the votes cast, shareholders shall not be permitted to vote against a nominee.
SECTION 10. Informal Action by Shareholders. Any action required or permitted to be taken at a meeting of shareholders may be taken without a meeting if a unanimous written consent which sets forth the action is provided in writing or by electronic transmission by each shareholder entitled to vote on the matter and filed in paper or electronic form with the records of shareholders’ meetings.
SECTION 11. Voting of Shares by Certain Holders. Shares registered in the name of a corporation, if entitled to be voted, may be voted by the president, a vice president or a proxy appointed by either of them, unless another person appointed to vote the shares under a bylaw or resolution of the board of directors presents a certified copy of the bylaw or resolution, in which case he or she may vote the shares. A fiduciary may vote, either in person or by proxy, shares registered in his or her name as fiduciary and shares registered in the name of another person on proof of the fact that legal title to the shares has devolved on him or her in a fiduciary capacity and that he or she is qualified to act in that capacity.
A shareholder whose shares are pledged shall be entitled to vote such shares until the shares have been transferred into the name of the pledgee and thereafter the pledgee shall be entitled to vote the shares so transferred.
Treasury shares of its own stock held by the Corporation shall not be voted at any meeting or counted in determining the total number of outstanding shares at any given time for purposes of any meeting.
SECTION 12. Inspectors of Election. In advance of any meeting of shareholders, the Board of Directors may appoint any persons, other than nominees for office, as inspectors of election to act at such meeting or any adjournment thereof. The number of inspectors shall be either one or three. If the Board of Directors so appoints either one or three inspectors, that appointment shall not be altered at the meeting. If inspectors of election are not so appointed, the Chair of the Board of Directors or the Chief Executive Officer may make such appointment at the meeting. In case any person appointed as inspector fails to appear or fails or refuses to act, the vacancy may be filled by appointment by the Board of Directors in advance of the meeting or at the meeting by the Chair of the Board of Directors or the Chief Executive Officer.
Unless otherwise prescribed by applicable law, the duties of such inspectors shall include: determining the number of shares of stock and the voting power of each share, the shares of stock represented at the meeting, the existence of a quorum, the authenticity, validity and effect of proxies; receiving votes, ballots or consents; hearing and determining all challenges and questions in any way arising in connection with the right to vote; counting and tabulating all votes or consents; determining the result; and such acts as may be proper to conduct the election or vote with fairness to all shareholders.
SECTION 13. Shareholder Nominations and Proposals. At any annual meeting of the shareholders, only such nominations of persons for election to the Board of Directors and such other business shall be conducted as shall have been properly brought before the meeting. To be properly brought before an annual meeting, nominations of persons for election to the Board of Directors of the Corporation and proposals for new business must be (a) specified in the notice of meeting (or any supplement thereto) given by or at the direction of the Board of Directors or any committee thereof, (b) otherwise properly brought before the meeting by or at the direction of the Board of Directors or any committee thereof, or (c) otherwise properly brought before the meeting by any shareholder of the Corporation who is entitled to vote with respect thereto and who complies with the notice procedures set forth in this section. For nominations or other business to be properly brought before an annual meeting by a shareholder, (i) the shareholder must have given timely notice thereof in writing to the Secretary of the Corporation and (ii) such other business must otherwise be a proper matter for shareholder action.
To be timely, a shareholder’s notice must be delivered to or mailed and received at the principal executive offices of the Corporation not later than the close of business on the ninetieth (90th) day nor earlier than the one hundred twentieth (120th) day prior to the first anniversary of the preceding year’s annual meeting; provided, however, that in the event that the date of the annual meeting is more than thirty (30) days before or more than sixty (60) days after such anniversary date, notice by the shareholder to be timely must be so delivered not earlier than the one hundred twentieth (120th) day prior to such annual meeting and not later than the close of business on the later of the ninetieth (90th) day prior to such annual meeting or the tenth (10th) day following the day on which public announcement of the date of such meeting is first made by the Corporation. In no event shall the public announcement of an adjournment or postponement of an annual meeting commence a new time period (or extend any time period) for the giving of a shareholder’s notice as described above.
Such shareholder’s notice shall set forth (i) as to each person whom such shareholder proposes to nominate for election or re-election as a director, (A) the full name, age and date of
birth of each nominee proposed in the notice, (B) the business and residence addresses and telephone numbers of each such nominee, (C) the educational background and business experience of each such nominee, including a list of positions held for at least the preceding five years, and (D) such other information concerning each such nominee that is required to be disclosed in solicitations of proxies for election of directors in an election contest, or is otherwise required to be disclosed, in each case pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder (including such person’s written consent to being named in the proxy statement as a nominee and to serving as a director if elected); (ii) as to any other business that the shareholder proposes to bring before the meeting; (A) a brief description of the business and the reasons for conducting such business at the meeting, (B) the text of the proposal or business (including the text of any resolutions proposed for consideration and, in the event that such business includes a proposal to amend the Bylaws of the Corporation, the language of the proposed amendment) and (C) any material interest of the shareholder in such business, and (iii) as to the shareholder giving the notice and the beneficial owner, if any, on whose behalf the nomination or proposal is made (A) the name and address of such shareholder, as they appear on the Corporation’s books, and of such beneficial owner, (B) the class and number of shares of capital stock of the Corporation which are owned beneficially and of record by such shareholder and such beneficial owner, (C) a description of any agreement, arrangement or understanding with respect to the nomination or proposal between or among such shareholder and such beneficial owner, any of their respective affiliates or associates, and any others acting in concert with any of the foregoing, (D) a description of any agreement, arrangement or understanding (including any derivative or short positions, profit interests, options, warrants, stock appreciation or similar rights, hedging transactions, and borrowed or loaned shares) that has been entered into as of the date of the shareholder’s notice by, or on behalf of, such shareholder and such beneficial owners, the effect or intent of which is to mitigate loss to, manage risk or benefit of share price changes for, or increase or decrease the voting power of, such shareholder or such beneficial owner, with respect to shares of stock of the Corporation, and (E) a representation that the shareholder is a holder of record of stock of the Corporation entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to propose such nomination or business.
Except as otherwise provided by law, the Corporation’s Articles of Incorporation or these Bylaws, the chair of the meeting shall have the power and duty (a) to determine whether a nomination or any business proposed to be brought before the meeting was made or proposed, as the case may be, in accordance with the procedures set forth in this section and (b) if any proposed nomination or business was not made or proposed in compliance with this section, to declare that such nomination shall be disregarded or that such proposed business shall not be transacted. Notwithstanding the foregoing provisions of this section, unless otherwise required by law, if the shareholder (or a qualified representative of the shareholder) does not appear at the annual meeting of shareholders of the Corporation to present a nomination or proposed business, such nomination shall be disregarded and such proposed business shall not be transacted, notwithstanding that proxies in respect of such vote may have been received by the Corporation. For purposes of this section, to be considered a qualified representative of the shareholder, a person must be a duly authorized officer, manager or partner of such shareholder or must be authorized by a writing executed by such shareholder or an electronic transmission delivered by such shareholder to act for such shareholder as proxy at the meeting of shareholders and such person must produce such writing or electronic transmission, or a reliable reproduction of the writing or electronic transmission, at the meeting of shareholders.
ARTICLE III
Board of Directors
SECTION 1. General Powers. The business and affairs of the Corporation shall be under the direction of its Board of Directors. In addition to other powers specifically set out in these Bylaws or that apply under the Maryland General Corporation Law, the Board of Directors and any committees thereof shall have the power to manage and administer the affairs of the Corporation and to do and perform all lawful acts with respect to the affairs of the Corporation except those that may be specifically reserved to the shareholders under the Maryland General Corporation Law.
SECTION 2. Chair of the Board. The Board of Directors shall annually elect one of its members to be its chair (the “Chair of the Board of Directors”) and shall fill any vacancy in the position of Chair of the Board of Directors at such time and in such manner as the Board of Directors shall determine. Except as otherwise provided in these Bylaws, the Chair of the Board of Directors shall preside at all meetings of the Board of Directors and of shareholders. The Chair of the Board of Directors shall perform such other duties and services as shall be assigned to or required of the Chair of the Board of Directors by the Board of Directors.
SECTION 3. Qualification of Directors. Each director must be the holder of unencumbered or unhypothecated shares of common stock of the Corporation having an aggregate par value of $1,000 or a fair market value of $1,000.
SECTION 4. Age Limitation. No person shall be eligible for election or appointment to the Board of Directors if such person is under twenty-one (21) or over seventy-two (72) years of age at the time of his or her election or appointment. No director shall serve beyond the annual meeting of shareholders immediately following his or her seventy-second (72nd) birthday. This limitation shall not apply to a person serving as an advisory director or a director emeritus. Notwithstanding the foregoing, a director may, at the request of the Nominating Committee and if ratified by the Board of Directors, continue to serve as a director after the annual meeting of shareholders immediately following his or her seventy-second (72nd) birthday if (i) he or she was appointed to the Board of Directors in connection with a corporate acquisition, consolidation, or merger and (ii) the Nominating Committee and Board determine that his or her continued service would be of substantial benefit to the Corporation in recognizing the benefit of such acquisition, consolidation or merger. The continuation of such person’s service as a director shall be for such period as the Nominating Committee, subject to the approval of the Board of Directors, shall determine.
SECTION 5. Number, Term and Election. The maximum number of directors is fixed by the Corporation’s Articles of Incorporation and may be altered only by amendment thereto. The minimum number of directors shall be the minimum required under the Maryland General Corporation Law. The Board of Directors may, by a vote of a majority of the directors then in office, between annual meetings of shareholders, increase or decrease the number of directors within such limits, provided that no decrease in the number of directors shall have the effect of shortening the term of any incumbent director. The Board of Directors shall be classified in accordance with the provisions of the Corporation’s Articles of Incorporation.
SECTION 6. Regular Meetings. Regular meetings of the Board of Directors may be held without notice at such times and at such places as may be determined from time to time by the Board of Directors.
SECTION 7. Special Meetings. Special meetings of the Board of Directors may be called by or at the request of the Chair of the Board of Directors, the Chief Executive Officer or any two directors of the Corporation. The Chair of the Board of Directors or the Chief Executive Officer may fix any place and time for holding any special meeting of the Board of Directors.
SECTION 8. Notice of Special Meetings. Notice of any special meeting shall be given to each director on at least twenty-four (24) hours’ notice to each director given by one of the means specified in SECTION 10 of this Article, other than by mail. Neither the business to be transacted at, nor the purpose of, any meeting of the Board of Directors need be specified in the notice of such meeting.
SECTION 9. Adjourned Meetings. A majority of the directors present at any meeting of the Board of Directors, including an adjourned meeting, whether or not a quorum is present, may adjourn and reconvene such meeting to another time and place. At least twenty-four (24) hours’ notice of any adjourned meeting of the Board of Directors shall be given to each director whether or not present at the time of the adjournment, by one of the means specified in SECTION 10 of this Article other than by mail. Any business may be transacted at an adjourned meeting that might have been transacted at the meeting as originally called.
SECTION 10. Notices. Subject to SECTION 8, SECTION 9, and SECTION 11 of this Article, whenever notice is required to be given to any director by applicable law, the Articles of Incorporation, or these bylaws, such notice shall be deemed given effectively if given in person or by telephone, mail addressed to such director at such director’s address as it appears on the records of the Corporation, facsimile, e-mail, or by other means of electronic transmission.
SECTION 11. Waiver of Notice. Whenever the Corporation’s Articles of Incorporation, these Bylaws, or the Maryland General Corporation Law require notice of the time, place, or purpose of a meeting of the Board of Directors or a committee thereof, a director waives notice if he or she, before or after the meeting, delivers a written waiver or a waiver by electronic transmission that is filed with the records of the meeting or is present at the meeting, except where a director attends a meeting for the express purpose of objecting to the transaction of any business because the meeting is not lawfully called or convened.
SECTION 12. Participation by Telephone. Members of the Board of Directors may participate in meetings by means of conference telephone or other communications equipment if all persons participating in the meeting can hear each other. Such participation shall constitute presence in person.
SECTION 13. Quorum. A majority of the directors shall constitute a quorum for the transaction of business at any meeting of the Board of Directors. If less than such majority is present at a meeting, a majority of the directors present may adjourn the meeting from time to time.
SECTION 14. Voting. The act of the majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors, unless the vote of a greater number is required by the Corporation’s Articles of Incorporation, these Bylaws, or the Maryland General Corporation Law.
SECTION 15. Action by Written Consent. Any action required or permitted to be taken at a meeting by the Board of Directors, or any committee thereof, may be taken without a meeting if a unanimous consent that sets forth the action is given in writing or by electronic transmission by each member of the Board of Directors or committee entitled to vote on the matter and filed in paper or electronic form with the minutes of proceedings of the Board of Directors or committee.
SECTION 16. Resignation. Any director may resign at any time by notice given in writing or by electronic transmission to the Corporation addressed to the Chair of the Board of Directors, the Chief Executive Officer, or the Secretary. Such resignation shall take effect at the date of receipt of such notice by the Corporation or at such later effective date or upon the happening of an event or events as is therein specified.
SECTION 17. Vacancies. Any vacancy occurring in the Board of Directors shall be filled in accordance with the provisions of the Corporation’s Articles of Incorporation. The term of such director shall be in accordance with the provisions of the Corporation’s Articles of Incorporation.
SECTION 18. Removal of Directors. Any director or the entire Board of Directors may be removed only in accordance with the provisions of the Corporation’s Articles of Incorporation.
SECTION 19. Compensation. Directors shall receive such reasonable fees for their services on the Board of Directors and any committee thereof and such reimbursement of their actual and reasonable expenses as may be fixed or determined by the Board of Directors. Nothing herein shall be construed to preclude any director from serving the Corporation in any other capacity and receiving remuneration therefor.
SECTION 20. Presumption of Assent. A director of the Corporation who is present at a meeting of the Board of Directors at which action on any corporate matter is taken shall be presumed to have assented to the action taken unless he or she announces his or her dissent at the meeting and his or her dissent is entered in the minutes of the meeting, files his or her written dissent to such action with the secretary of the meeting before the meeting is adjourned, or forwards his or her dissent within twenty-four (24) hours after the meeting is adjourned by certified mail, return receipt requested, bearing a postmark from the United States Postal Service, to the secretary of the meeting or the Secretary of the Corporation. The right to dissent shall not apply to a director who voted in favor of the action or failed to make his or her dissent known at the meeting.
SECTION 21. Directors Emeritus. The Board of Directors may, in its discretion, confer upon a director who retires or resigns the designation of “Director Emeritus.” Such designation shall be honorary only and the person so designated shall not have any of the rights or duties of a
director. If invited by the Board of Directors, a Director Emeritus may attend a meeting of the Board of Directors.
ARTICLE IV
Committees of the Board of Directors
The Board of Directors may, by resolution passed by a majority of the whole Board of Directors, designate one or more committees, as they may determine to be necessary or appropriate for the conduct of the business of the Corporation, and may prescribe the duties, constitution and procedures thereof. The Board of Directors may delegate to an executive committee the power to exercise all the authority of the Board of Directors in the management of the affairs and property of the Corporation, except such authority as may be specifically reserved to the full Board of Directors by the Maryland General Corporation Law. Each committee shall consist of one or more directors of the Corporation. In the absence or disqualification of a member of a committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not a quorum exists, may unanimously appoint another member of the Board of Directors to act at the meeting in the place of the disqualified or absent member.
The Board of Directors shall have power, by the affirmative vote of a majority of the authorized number of directors, at any time to change the members of, to fill vacancies in, and to discharge any committee of the Board of Directors. Any member of any committee of the Board of Directors may be removed at any time, either with or without cause, by the affirmative vote of a majority of the authorized number of directors at any meeting of the Board of Directors.
ARTICLE V
Officers
SECTION 1. Positions. The officers of the Corporation shall be chosen by the Board of Directors and shall include a chief executive officer (the “Chief Executive Officer”), a president (the “President”), a chief financial officer (the “Chief Financial Officer”), a treasurer (the “Treasurer”), and a secretary (the “Secretary”). The Board of Directors, in its discretion, may also elect one or more vice presidents, assistant treasurers, assistant secretaries, and other officers as the Board of Directors shall from time to time deem necessary for the conduct of the business of the Corporation. Any two or more offices may be held by the same person. The Board of Directors may designate one or more Vice Presidents as Executive Vice President or Senior Vice President.
SECTION 2. Election and Term of Office. The officers of the Corporation shall be elected annually by the Board of Directors at the first meeting of the Board of Directors held after each annual meeting of the shareholders. If the election of officers is not held at such meeting, such election shall be held as soon thereafter as possible. Each officer shall hold office until his successor shall have been duly elected and qualified or until such officer’s earlier death, resignation, or removal. Election or appointment of an officer shall not of itself create contract rights. The Board of Directors may authorize the Corporation to enter into an employment contract with any officer in accordance with state law, but no such contract shall impair the right of the Board of Directors to remove any officer at any time in accordance with SECTION 11 of this Article V.
SECTION 3. Chief Executive Officer. The Chief Executive Officer shall be the principal executive officer of the Corporation and shall have, subject to the control of the Board of Directors, general supervision and direction of the business and affairs of the Corporation and of its several officers. In the absence of the Chair of the Board of Directors, the Chief Executive Officer shall preside at all meetings of the shareholders and at all meetings of the Board of Directors. He or she shall have the power to execute any document or perform any act on behalf of the Corporation, including without limitation the power to sign checks, orders, contracts, leases, notes, drafts and other documents and instruments in connection with the business of the Corporation and, together with the Secretary or an Assistant Corporate Secretary, execute conveyances of real estate and other documents and instruments to which the seal of the Corporation may be affixed. The Chief Executive Officer shall perform such other duties as from time to time may be prescribed by the Board of Directors.
SECTION 4. President. The President shall, subject to the direction and control of the Board of Directors and the Chief Executive Officer, participate in the supervision of the business and affairs of the Corporation. In general, the President shall perform all duties incident to the office of President, and such other duties as from time to time may be prescribed by the Board of Directors or the Chief Executive Officer. In the absence of the Chair of the Board of Directors and the Chief Executive Officer, the President shall preside at meetings of shareholders and of the Board of Directors. The President shall have the same power to perform any act on behalf of the Corporation and to sign for the Corporation as is prescribed in these Bylaws for the Chief Executive Officer.
SECTION 5. Chief Financial Officer. The Chief Financial Officer shall be the principal financial officer of the Corporation and shall have such powers and perform such duties as the Board of Directors, the Chief Executive Officer or the President may from time to time prescribe, which may include, without limitation, responsibility for strategic planning, corporate finance, financial reporting, control, tax and auditing and shall perform such other duties as may be prescribed by these Bylaws.
SECTION 6. Treasurer. The Treasurer shall have charge and custody of and be responsible for all funds and securities of the Corporation. The Treasurer shall cause the funds of the Corporation to be deposited in such banks as may be authorized by the Board of Directors or in such banks as may be designated as depositaries in the manner provided by resolution of the Board of Directors and will perform any other duties assigned to that office by the Board of Directors, Chief Executive Officer or President.
SECTION 7. Secretary. The Secretary shall: (a) prepare and keep minutes of meetings of the shareholders, the Board of Directors and committees of the Board of Directors in one or more books kept for that purpose; (b) see that all notices are duly given in accordance with the provisions of these Bylaws or as required by law; (c) be custodian of the seal of the Corporation and have authority to affix such seal or a facsimile thereof to any documents the execution of which on behalf of the Corporation is duly authorized and may attest such seal when so affixed; and (d) in general, perform all duties incident to the office of Secretary and such other duties as from time to time may be prescribed by the Board of Directors, the Chief Executive Officer or the President.
SECTION 8. Assistant Corporate Secretary. At the request of the Secretary, or in case of his or her absence or inability to act, the Assistant Corporate Secretary, or if there be more than one, any of the Assistant Corporate Secretaries, shall perform the duties of the Secretary and, when so acting, shall have all the powers of, and be subject to all the restrictions upon, the Secretary. Each Assistant Corporate Secretary shall perform such other duties as from time to time may be prescribed by the Chief Executive Officer, the President or the Secretary.
SECTION 9. Powers of Other Officers. The other officers shall have such authority and perform such duties as the Board of Directors may from time to time authorize or determine. In the absence of action by the Board of Directors, the officers shall have such powers and duties as are generally incident to their respective offices.
SECTION 10. Resignation. Any officer of the Corporation may resign at any time by giving notice of his or her resignation in writing, or by electronic transmission, to the Chief Executive Officer, President or the Secretary. Any such resignation shall take effect at the time specified therein or, if the time when it shall become effective shall not be specified therein, immediately upon its receipt. Unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective.
SECTION 11. Removal. The Board of Directors may remove any officer of the Corporation, but such removal shall be without prejudice to the contract rights, if any, of the person so removed.
ARTICLE VI
Certificates for Shares and Their Transfer
SECTION 1. Certificates for Shares. The shares of the Corporation shall be represented by certificates; provided that the Board of Directors may provide by resolution or resolutions that some or all of any class or series shall be uncertificated shares that may be evidenced by a book-entry system maintained by the registrar of such stock. If shares are represented by certificates, such certificates shall be in the form approved by the Board of Directors. Each stock certificate shall be signed by the Chief Executive Officer, President, a vice president, or the Chief Financial Officer, and countersigned by the Secretary, an Assistant Secretary, the Treasurer, an Assistant Treasurer, or any other officer. Each certificate may be sealed with the actual corporate seal or a facsimile of it or in any other form; and the signatures may be either manual or facsimile signatures. If any officer who has signed or whose facsimile signature has been placed upon such certificate shall have ceased to be such officer before the certificate is issued, it may be issued by the Corporation with the same effect as if he were such officer at the date of its issue.
SECTION 2. Form of Certificates. All certificates representing shares issued by the Corporation shall set forth upon the face or back that the Corporation will furnish to any shareholder upon request and without charge a full statement of the designations, preferences, limitations, and relative rights of the shares of each class authorized to be issued, the variations in the relative rights and preferences between the shares of each such series so far as the same have been fixed and determined, and the authority of the Board of Directors to fix and determine the relative rights and preferences of subsequent series.
Each certificate representing shares shall state upon the face thereof: the name of the Corporation; the name of the shareholder or other person to whom it is issued; and the class of stock and number of shares it represents. Other matters in regard to the form of the certificates shall be determined by the Board of Directors.
SECTION 3. Payment for Shares. No certificate shall be issued for any shares until such share is fully paid. The consideration for the issuance of shares shall be paid in accordance with the provisions of the Corporation’s Articles of Incorporation.
SECTION 4. Transfer of Shares. Stock of the Corporation shall be transferable in the manner prescribed by law and in these Bylaws. Transfer of shares of capital stock of the Corporation shall be made on the books administered by or on behalf of the Corporation. Authority for such transfer shall be given only by the holder of record thereof or by such person’s legal representative, who shall furnish proper evidence of such authority, or by such person’s attorney thereunto authorized by power of attorney duly executed and filed with the Corporation. In the case of certificated shares, such transfer shall be made only on surrender for cancellation of the certificate for such shares. The person in whose name shares of capital stock stand on the books of the Corporation shall be deemed by the Corporation to be the owner thereof for all purposes.
SECTION 5. Transfer Agents and Registrars. The Board of Directors may appoint, or authorize any officer or officers to appoint, one or more transfer agents and one or more registrars.
SECTION 6. Stock Ledger. The stock ledger of the Corporation shall be the only evidence as to who are the shareholders entitled to examine the stock ledger or the books of the Corporation or to vote in person or by proxy at any meeting of shareholders.
SECTION 7. Lost, Stolen or Destroyed Certificates. The Board of Directors or the Secretary may direct a new certificate to be issued in place of any certificate theretofore issued by the Corporation alleged to have been lost, stolen, or destroyed, upon the making of an affidavit of that fact by the person claiming the certificate of stock to be lost, stolen, or destroyed. When authorizing such issue of a new certificate, the Board of Directors or the Secretary may, in its discretion and as a condition precedent to the issuance thereof, require the owner of such lost, stolen, or destroyed certificate, or his legal representative, to give the Corporation a bond in such sum as it may direct as indemnity against any claim that may be made against the Corporation with respect to the certificate alleged to have been lost, stolen, or destroyed.
SECTION 8. Beneficial Owners. The Corporation shall be entitled to recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends, and to vote as such owner, and shall not be bound to recognize any equitable or other claim to or interest in such shares on the part of any other person, whether or not the Corporation shall have express or other notice thereof, except as otherwise provided by law.
ARTICLE VII
Fiscal Year; Annual Audit
The fiscal year of the Corporation shall end on the 31st day of December of each year. The Corporation shall be subject to an annual audit as of the end of its fiscal year by independent public accountants appointed by and responsible to the Board of Directors.
ARTICLE VIII
Dividends
Subject to the provisions of the Corporation’s Articles of Incorporation and applicable law, the Board of Directors may, at any regular or special meeting, declare dividends on the Corporation’s outstanding capital stock. Dividends may be paid in cash, in property or in the Corporation’s own stock.
ARTICLE IX
Corporate Seal
The corporate seal of the Corporation shall be in such form as the Board of Directors shall prescribe.
ARTICLE X
Amendments
In accordance with the Corporation’s Articles of Incorporation, the Board of Directors of the Corporation may repeal, alter, amend or rescind these Bylaws by a majority vote of the Board of Directors at a legal meeting held in accordance with the provisions of these Bylaws. In addition, these Bylaws may be repealed, altered, amended or rescinded by the shareholders of the Corporation by vote of not less than eighty percent (80%) of the outstanding shares of capital stock of the Corporation entitled to vote generally in the election of directors (considered for this purpose as one class) cast at a meeting of the shareholders called for that purpose (provided that notice of such proposed repeal, alteration, amendment or rescission is included in the notice of such meeting).
ARTICLE XI
Exclusive Forum for Certain Disputes
Unless the Corporation consents in writing to the selection of an alternative forum, a state court located within the State of Maryland (or, if no state court located within the State of Maryland has jurisdiction, the United States District Court for the District of Maryland) shall, to the fullest extent permitted by law, be the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of the Corporation, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of the Corporation to the Corporation or the Corporation’s shareholders, (iii) any action asserting a claim arising pursuant to any provision of the Maryland General Corporation Law, and (iv) any action asserting a claim governed by the internal affairs doctrine. Any person or entity purchasing or otherwise acquiring or holding any interest in shares of capital stock of the corporation shall be deemed to have notice of and consented to the provisions of this Article.
* * *
Adopted by the Board of Directors: December 14, 2022
SANDY SPRING BANCORP, INC.
EXECUTIVE SEVERANCE PLAN
1.Name, Purpose and Effective Date
1.1 Name and Purpose of Plan. The purpose of this Sandy Spring Bancorp, Inc. Executive Severance Plan (the “Plan”) is to provide severance benefits to certain senior executives and key employees of the Company and its affiliates in the event their employment is terminated in certain circumstances, including certain terminations related to a Change in Control. The Plan is intended to secure the continued services of executive and key employees of the Company and its affiliates and to ensure their continued dedication to their duties in the event of any threat or occurrence of a Change in Control. The Plan is also intended to provide a level of security to executive and key employees who are terminated without Cause, notwithstanding that such termination has occurred outside of a Covered Period.
1.2 Effective Date. The Plan became effective on December 14, 2022 (the “Effective Date”).
1.3 ERISA Status. The Plan is intended to be an unfunded plan that is maintained primarily to provide severance compensation and benefits to a select group of “management or highly compensated employees” within the meaning of Sections 201, 301 and 401 of ERISA, and therefore to be exempt from the provisions of Parts 2, 3 and 4 of Title I of ERISA.
2.Definitions
The following words and phrases will have the following meanings unless a different meaning is plainly required by the context:
2.1 “Base Salary” means the annualized gross base salary payable to a Participant, before any deductions, exclusions, deferrals or contributions on a tax-qualified or non-tax-qualified basis under any plan or program of the Company or any of its affiliates.
2.2 “Board” means the Board of Directors of the Company.
2.3 “Cause” means a Participant’s (a) dishonesty, willful misconduct, bad faith or a lack of complete integrity or candor (including, but not limited to, any acts of embezzlement or misappropriation of funds), breach of or dereliction of fiduciary duty, or fraud, in each case in connection with the performance of services on behalf of the Company or any of its affiliates or otherwise in connection with the Participant’s position with the Company or any of its affiliates, (b) intentional failure to perform the duties assigned to or expected of the Participant after reasonable notification (which shall be stated in writing and given at least fifteen (15) days prior to termination) by the Board of such failure, (c) conviction of a felony, plea of guilty or nolo contendere or finding of liability of or under any law, rule or regulation (other than traffic violations or similar offenses) or final cease-and-desist order, (d) engaging in behavior that would constitute grounds for liability (the Company’s and/or the Participant’s) for harassment, retaliation or discrimination (as proscribed by the U.S. Equal Employment Opportunity Commission or applicable state or local law) or other egregious conduct violative of laws
governing the workplace, or (e) material violation of any of the rules of conduct or behavior of the Company or any of its affiliates, such as may be provided in any employee handbook or code of ethics as the Company or any of its affiliates may promulgate from time to time, following notice and a reasonable opportunity to cure in the sole discretion of the Company (if such violation is capable of cure).
For purposes of this Section 2.3, no act or failure to act will be considered “willful” or “intentional” unless done or omitted to be done in bad faith and without reasonable belief that the Participant’s action or omission was in the best interests of the Company. Any act, or failure to act, based upon authority given pursuant to a resolution duly adopted by the Board, based upon the advice of counsel for the Company or upon the instructions of the Company’s chief executive officer or another senior officer of the Company will be conclusively presumed to be done, or omitted to be done, by the Participant in good faith and in the best interests of the Company. “Cause” will not exist unless and until the Company has delivered to the Participant a copy of a resolution duly adopted by the affirmative vote of a majority of the entire Board (excluding the Participant if the Participant is a Board member) at a meeting of the Board called and held for such purpose (after reasonable notice to the Participant and an opportunity for the Participant to be heard before the Board), finding that in the good faith opinion of the Board an event set forth in Section 2.3 has occurred and specifying the particulars thereof in detail.
2.4 “Change in Control” means the occurrence of any of the following events:
(a) the acquisition by any “person” (as such term is defined in Section 3(a)(9) of the Securities Exchange Act of 1934 (the “Exchange Act”) and as used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act) of direct or indirect beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 25% or more of the combined voting power of the then-outstanding securities of the Company entitled to vote in the election of directors of the Company; provided, however, that the following acquisitions shall not constitute a Change in Control: (i) any acquisition directly from the Company; (ii) any acquisition by the Company; (iii) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any of its affiliates; or (iv) any acquisition pursuant to a transaction that complies with clauses (c)(i), (ii) and (iii) below;
(b) the individuals who, as of the Effective Date, constitute the Board (the “Incumbent Directors”) cease for any reason to constitute at least a majority of the Board; provided that any individual becoming a director subsequent to the Effective Date whose election or nomination for election was approved by a vote of at least two-thirds of the Incumbent Directors then on the Board (either by a specific vote or by approval of the proxy statement of the Company in which such individual is named as a nominee for director, without written objection to such nomination) shall be considered an Incumbent Director, unless such individual is initially elected or nominated as a director of the Company as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or behalf of a person other than the Board, including by reason of any agreement intended to avoid or settle any election contest or proxy solicitation;
(c) the consummation of a merger, consolidation, reorganization, statutory share exchange or similar form of corporation transaction involving the Company or involving the issuance of securities by the Company or the acquisition of assets or stock of another entity by the Company (each, a “Business Combination”), unless immediately following such Business Combination:
(i) the shareholders of the Company immediately prior to such Business Combination own directly or indirectly at least 60% of the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors (or, for a non-corporate entity, equivalent governing body) of the entity resulting from such Business Combination (including, without limitation, an entity that, as a result of such transaction, owns the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries) (the “Surviving Company”) in substantially the same proportion as their ownership of voting securities of the Company immediately prior to such Business Combination;
(ii) at least a majority of the members of the board of directors (or, for a non-corporate entity, equivalent governing body) of the Surviving Company were Incumbent Directors at the time of the execution of the initial agreement or action of the Board providing for such Business Combination; and
(iii) no person other than (A) the Surviving Company or (B) any employee benefit plan (or related trust) sponsored or maintained by the Company immediately prior to such Business Combination beneficially owns, directly or indirectly, 25% or more of the combined voting power of the Surviving Company’s then-outstanding voting securities entitled to vote in the election of directors;
(d) the sale of all or substantially all the assets of the Company (other than to an affiliate of the Company); or
(e) the Company’s shareholders approve a plan of dissolution or complete liquidation of the Company.
To the extent necessary to comply with Section 409A of the Code, a Change in Control will be deemed to have occurred only if the event also constitutes a change in the effective ownership or effective control of the Company or a change in the ownership of a substantial portion of the assets of the Company, in each case within the meaning of Treasury Regulation section 1.409A-3(i)(5).
2.5 “Code” means the Internal Revenue Code of 1986, as amended.
2.6 “Committee” means the Compensation Committee of the Board, or any successor thereto or other committee designated by the Board to assume the obligations of the Committee hereunder.
2.7 “Company” means Sandy Spring Bancorp, Inc., a Maryland corporation, and any successor or assignee as provided in Section 6.3.
2.8 “Competitive Business” means any business enterprise that either (a) engages in any activity that competes with the business of the Company or any of its affiliates or (b) holds a five percent (5%) or greater equity, voting or profit participation interest in any enterprise that engages in such a competitive activity.
2.9 “Confidential Information” means any information relating to the Company or any of its affiliates, or their respective products, services, borrowers, depositors and other clients that is not generally known or available to the general public, including, but not limited to, (a) operation or financial information, such as information with respect to costs, fees, profits, sales, sales margins, capital structure, operating results, borrowing arrangements, strategies and plans for future business, pending projects and proposals and potential acquisitions or divestitures, (b) product and technical information, such as new and innovative product ideas, subjects of research and development, investigations, data, software, software codes, computer models and research and development projects, (c) marketing information, such as new marketing ideas, markets, mailing lists, the identity, including the names or addresses, of the borrowers, depositors and other clients of the Company or any of its affiliates, the financial arrangement between the Company or any of its affiliates and such clients, specific client needs and requirements and leads and referrals to prospective clients, (d) vendor, supplier and any other business partner information, including the financial arrangement between the Company or any of its affiliates and such persons, and (e) any information concerning or obtained from the clients of the Company or any of its affiliates.
2.10 “Covered Period” means the period commencing with the Company’s initial public announcement, in a report or proxy solicitation materials filed under the Exchange Act, of the agreements or other actions by the Company or the Board that are expected or intended to result in a Change in Control and ending twenty-four (24) months following the occurrence of such Change in Control. In the case of a tender or exchange offer that results in a Change in Control, the Covered Period shall commence on the date that the Company or the Board publicly announces acceptance or support of the offer or, if acceptance or support is never announced, the date that the person making the offer publicly announces that the person knows or believes that the offer has sufficient support among Company shareholders to succeed in causing a Change in Control. The Covered Period will be extended by one additional month if the cure period in Section 2.13 is triggered in the 23rd or 24th month following a Change in Control.
2.11 “Disability” means a physical or mental infirmity that impairs the Participant’s ability to substantially perform duties assigned to the Participant and that results in the Participant’s becoming eligible for long-term disability benefits under the Company’s or its successor’s long-term disability plan or from the U.S. Social Security Administration. A Participant shall not be deemed to have a Disability until the date on which the insurer
or the administrator of the Company’s long-term disability insurance program notifies the Participant that the Participant is eligible to commence benefits under such insurance or the date on which the U.S. Social Security Administration notifies the Participant that the Participant is eligible to commence disability benefits from such agency.
2.12 “ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
2.13 “Good Reason” means, without the Participant’s consent, the occurrence of any of the following events:
(a) a material diminution in the Participant’s title, authority, duties or responsibilities;
(b) any (i) reduction in the Participant’s Base Salary or (ii) material reduction in the Participant’s aggregate annual compensation opportunity (including Base Salary and annual and long-term target incentive compensation opportunities);
(c) any requirement of the Company that the Participant be based anywhere more than fifty (50) miles from the office where the Participant is located as of immediately prior to the Change in Control; or
(d) the failure of the Company to obtain the assumption of the Plan from any successor.
Notwithstanding the forgoing, the Participant will only have Good Reason if the Participant provides notice to the Company of the existence of the event or circumstance constituting Good Reason specified in any of the preceding clauses within ninety (90) days of the initial existence of such event or circumstances and such event or circumstance is not cured within thirty (30) days after the Company’s receipt of such notice. If the Participant initiates termination with Good Reason, the actual termination must occur within sixty (60) days after the date of the notice of termination. The Participant’s failure to timely give notice of termination with respect to the occurrence of a specific event that would otherwise constitute Good Reason will not constitute a waiver of the Participant’s right to give notice of any new subsequent event that would constitute Good Reason that occurs after such prior event (regardless of whether the new subsequent event is of the same or different nature as the preceding event).
2.14 “Participant” means a senior executive or key employee of the Company or any of its affiliates who has been chosen by the Committee to participate in the Plan and who is a party to a Participation Agreement that has not been terminated in accordance with the terms of the Plan.
2.15 “Participation Agreement” means an agreement to participate in the Plan substantially in the form of Exhibit B hereto.
2.16 “Pro-Rata Bonus” means an amount equal to the product of a (a) Participant’s Target Bonus for the year in which the Participant’s Termination Date occurs and (b) a fraction, the numerator of which is the number of days elapsed from the beginning of the
applicable calendar year through the Participant’s Termination Date and the denominator of which is the number of days in the applicable calendar year.
2.17 “Qualifying Termination” means any termination of a Participant’s employment with the Company or any of its affiliates (or its successor) following the Effective Date (a) by the Company or any of its affiliates (or its successor) other than for Cause or (b) during a Covered Period, by the Participant for Good Reason. For the avoidance of doubt, termination of the Participant’s employment on account of death or Disability, or by the Company or any of its affiliates for Cause, or by the Participant for other than Good Reason, shall not be treated as a Qualifying Termination. Notwithstanding the foregoing, the death of the Participant after notice of termination for Good Reason or without Cause has been validly provided shall be deemed to be a Qualifying Termination.
2.18 “Severance Multiple” means, for each Participant, the applicable multiple set forth on Exhibit A hereto corresponding to such individual’s level of participation as designated in writing by the Committee and communicated to the Participant by the Company.
2.19 “Target Bonus” means a Participant’s target annual bonus under the annual incentive plan applicable to such Participant.
2.20 “Termination Date” means the date on which a Participant experiences a Qualifying Termination.
3.Participation and Severance Benefits
3.1 Participants. From time to time the Committee may select, in its discretion, those senior executives and key employees to be offered participation in the Plan. The Committee will determine, in its discretion, the Severance Multiple for each Participant. No senior executive or other employee has any right to participate in the Plan, and no Participant has any right to any particular Severance Multiple. The list of Participants is set forth in Exhibit A. The Committee may update Exhibit A at any time to reflect the then current Participants, without formally amending the Plan. Each individual selected to participate will become a Participant when, and only when, he or she executes and delivers a Participation Agreement.
3.2 Termination of Participant. A Participant shall cease to be a Participant in the Plan and, therefore, shall cease to be eligible to receive severance benefits under the Plan on the date on which the Participant ceases to be an employee of the Company or any of its affiliates other than by a Qualifying Termination. Unless the Participant otherwise agrees after receiving notice, the Committee may terminate the participation of any Participant at any time, but the Participant’s removal from the Plan will not be effective until the later of (a) twenty-four (24) months after the Company gives notice to the Participant of the Committee’s action and of its effective date or (b) the end of any Covered Period for the Participant that commenced before the Committee’s action and that was ongoing at the time of such action.
3.3 Non-Change in Control Severance Benefits. If a Participant experiences a Qualifying Termination during a time that is not a Covered Period, the Participant will be entitled to the following payments under the Plan (subject to the terms and conditions hereof), in addition to any amounts due by the Company to the Participant in connection with services performed by the Participant prior to the Participant’s Termination Date:
(a) lump sum cash payment equal to the Participant’s Pro-Rata Bonus;
(b) cash severance in an amount equal to the Participant’s Severance Multiple, multiplied by the Participant’s Base Salary as in effect on the Participant’s Termination Date;
(c) if the Participant elects COBRA continuation coverage, a cash payment equal to the amount obtained by multiplying (i) the monthly cost for COBRA continuation coverage (as in effect as of the Participant’s Termination Date) for group medical, dental and vision coverage for the Participant and his or her dependents (to the extent that they are covered by the Company’s health and welfare plans) immediately before the Participant’s Termination Date by (ii) the number of months represented by the Participant’s Severance Multiple.
3.4 Change in Control Severance Benefits. If a Participant experiences a Qualifying Termination during a Covered Period, the Participant will be entitled to the following payments under the Plan (subject to the terms and conditions hereof), in addition to any amounts due by the Company to the Participant in connection with services performed by the Participant prior to the Participant’s Termination Date:
(a) a lump sum cash payment equal to the Participant’s Pro-Rata Bonus;
(b) a lump sum cash payment equal to the Participant’s Severance Multiple, multiplied by the sum of (i) the greater of (x) the Participant’s Base Salary as in effect immediately before the applicable Change in Control occurred or (y) the Participant’s Base Salary as in effect on the Participant’s Termination Date and (ii) the Participant’s Target Bonus for the fiscal year in which the Participant’s Termination Date occurs; and
(c) if the Participant elects COBRA continuation coverage, a lump sum cash payment equal to the amount obtained by multiplying (i) the monthly cost for COBRA continuation coverage (as in effect as of the Participant’s Termination Date) for group medical, dental and vision coverage for the Participant and his or her dependents (to the extent that they are covered by the Company’s health and welfare plans) immediately before the Participant’s Termination Date by (ii) the number of months represented by the Participant’s Severance Multiple.
3.5 Timing of Severance Payments. Except as provided below in Section 6.14, the cash payments specified in Sections 3.3(a) and 3.4 shall be paid on a regular payday within thirty (30) days following the date on which the Release described in Section 3.7 becomes effective and irrevocable pursuant to its terms (provided that such payments shall be made no later than March 15th of the calendar year following the calendar year in
which the Participant’s Termination Date occurs). Except as provided below in Section 6.14, the cash payments specified in Sections 3.3(b) and 3.3(c) shall be paid in equal installments in accordance with the Company’s regular payroll practices, starting on a regular payday within thirty (30) days following the date on which the Release described in Section 3.7 becomes effective and irrevocable pursuant to its terms. The first installment payment shall include all amounts that would otherwise have been paid to the Participant during the period beginning on the Participant’s Termination Date and ending on the first payment date.
3.6 Company Automobile. If a Participant experiences a Qualifying Termination during a Covered Period and, at the time of the Termination Date, the Participant has the use of an automobile provided at the expense of the Company or is otherwise provided an automobile allowance by the Company, the Participant will have the right, for ninety (90) days following the Termination Date: (a) to continue to use the automobile on the same basis on which such Participant used it immediately before the Termination Date; or (b) to purchase the automobile from the Company for its lowest wholesale Kelley Blue Book value from a range determined based on the actual mileage, condition and features of the applicable automobile, or, if the Company has leased the automobile, to assume the lease.
3.7 Conditions to Severance Benefits. A Participant’s receipt of payments under the Plan will be conditioned on (a) the execution of a general release of all actual and potential claims that the Participant may have against the Company or any of its affiliates in the form provided to the Participant by the Company (the “Release”) and (b) such Release becoming effective and irrevocable not later than the sixtieth (60th) day following the Participant’s Termination Date. The terms and conditions of the Release will be substantially identical for all Participants similarly situated in connection with a Change in Control. The Company will provide the Release to the Participant within five (5) days following the Participant’s Termination Date. If the Participant does not execute and deliver the Release, or if the effective date of the Release does not occur within the sixty (60) days following the Participant’s Termination Date, the Participant will not be entitled to any payments provided for under the Plan.
3.8 No Duplication of Severance Benefits. If a Participant experiences a Qualifying Termination, the Participant will not be paid any amount, or receive any benefit, under or pursuant to any other plan or program calling for severance benefits, including special severance benefits related to a change in control event (as defined in the Plan or in such other plan or program). To the extent that a Participant is a party to any written and legally binding employment, retention, retirement or severance agreement with the Company or any of its affiliates and that a provision in such agreement (including a provision calling for special severance benefits related to a change in control event (as defined in the Plan or in such agreement)) is inconsistent with any provision of the Plan, then (a) if the agreement is entered into after the Participant becomes a Participant in the Plan, and if the agreement expressly provides that its inconsistent provision is intended to supersede, override, or settle matters under the Plan for that Participant, the agreement’s provision will govern and control, but (b) in any other circumstances, the provision of the Plan will govern and control. For the avoidance of doubt, amounts awarded under a retention bonus that pays out in connection with a Qualifying Termination during a
Covered Period shall not be considered duplicative of the severance benefits provided under Section 3.4 or 3.4 of the Plan.
3.9 Other Benefits Not Affected. None of the following benefits, programs, or other employment-related matters is enhanced, diminished or otherwise affected by the Plan, none is considered a benefit of the Plan, and none is waived, released, or otherwise affected by a Participant’s Release unless expressly so provided in that Release:
(a) A Participant’s accounts in a savings plan, nonqualified deferred compensation plan, or other similar deferral plan or program of the Company or any of its affiliate, including any rights to require a rabbi trust or other similar funding protection;
(b) A Participant’s rights under a pension or other funded defined-benefit retirement plan of the Company or any of its affiliates;
(c) A Participant’s rights under any award of restricted stock, restricted stock units, stock options, stock appreciation rights, or other equity incentive awards, in each case whether or not associated with performance conditions, under the Sandy Spring Bancorp, Inc. 2015 Omnibus Incentive Plan or other equity plan sponsored by the Company and/or award agreements issued thereunder;
(d) A Participant’s rights under any life or disability insurance plan or program of the Company or any of its affiliates, including any split-dollar life insurance agreement and the right to continue coverage after termination of employment, whether or not at the Participant’s cost; and
(e) A Participant’s rights to obtain or continue health, dental or similar insurance coverage after termination of employment (so-called COBRA continuation rights).
3.10 Golden Parachute Provisions. In the event that any benefits payable to a Participant pursuant to the Plan or otherwise (“Payments”) (i) constitute “parachute payments” within the meaning of Section 280G of the Code and (ii) but for this Section 3.10 would be subject to the excise tax imposed by Section 4999 of the Code or any comparable successor provisions (the “Excise Tax”), then the Participant’s Payments hereunder will be either (x) provided to the Participant in full or (y) provided to the Participant as to such lesser extent which would result in no portion of such benefits being subject to the Excise Tax, whichever of the foregoing amounts, when taking into account applicable federal, state, local and foreign income and employment taxes, the Excise Tax and any other applicable taxes, results in the receipt by the Participant, on an after-tax basis, of the greatest amount of benefits, notwithstanding that all or some portion of such benefits may be taxable under the Excise Tax. In the event that the Payments are to be reduced pursuant to this Section 3.10, and none of such Payments are “deferred compensation” subject to Section 409A of the Code, then the reduction will occur in the manner elected by the Participant in writing prior to the date of payment. If any Payment constitutes “deferred compensation” subject to Section 409A of the Code or if the Participant fails to elect an order, then the Payments to be reduced will be
determined in a manner which has the least economic cost to the Participant and, to the extent the economic cost is equivalent, will be reduced in the inverse order of when payment would have been made, until the reduction is achieved. Unless the Company and the Participant otherwise agree in writing, any determination required under this Section 3.10 will be made in writing in good faith by a nationally recognized accounting firm or other independent advisors selected by the Company (the “Accountants”) which will provide detailed supporting calculations both to the Company and the Participant within fifteen (15) business days of the receipt of notice from the Company or the Participant that there has been a payment that may be subject to Section 4999 of the Code, or such earlier time as is requested by the Company, and whose determination will be final, conclusive and binding upon the Participant and the Company for all purposes (and the Company will report such payments consistently and will reasonably defend such calculations). For purposes of making the calculations required by this Section 3.10, the Accountants may make reasonable assumptions and approximations concerning applicable taxes and may rely on reasonable, good faith interpretations concerning the application of Sections 280G and 4999 of the Code. The Company and Participant agree to furnish to the Accountants such information and documents as the Accountants may reasonably request in order to make a determination under this provision. The Company will bear all costs the Accountants may reasonably incur in connection with any calculations contemplated by this Section 3.10.
4.Restrictive Covenants
4.1 Non-Disclosure of Confidential Material. During employment and thereafter, the Participant shall hold in a fiduciary capacity for the benefit of the Company and its affiliates all trade secrets and Confidential Information relating to the Company or any of its affiliates that have been obtained by the Participant during his or her employment by the Company or any of its affiliates. Except as may be required or appropriate in connection with the Participant carrying out his or her duties as an employee, he or she will not, without the prior written consent of the Company or as may otherwise be required by law or any legal process, any statutory obligation or order of any court or statutory tribunal of competent jurisdiction, or as is necessary in connection with any adversarial proceeding against the Company or any of its affiliates (in which case the Participant will use his or her reasonable best efforts in cooperating with the Company in obtaining a protective order against disclosure by a court of competent jurisdiction), communicate or divulge any such trade secrets or Confidential Information to anyone other than the Company and those designated by the Company or on behalf of the Company in the furtherance of its business or to perform duties hereunder. Notwithstanding anything to the contrary in the Plan or otherwise, nothing shall limit the rights of a Participant under applicable law to provide truthful information to any governmental entity or to file a charge with or participate in an investigation conducted by any governmental entity. Participants are hereby notified that the immunity provisions in Section 1833 of title 18 of the United States Code provide that an individual cannot be held criminally or civilly liable under any federal or state trade secret law for any disclosure of a trade secret that is made: (1) in confidence to federal, state or local government officials, either directly or indirectly, or to an attorney, and is solely for the purpose of reporting or investigating a suspected violation of the law, (2) under seal in a complaint or other document filed in a lawsuit or other proceeding or (3) to an attorney in
connection with a lawsuit for retaliation for reporting a suspected violation of law (and the trade secret may be used in the court proceedings for such lawsuit) as long as any document containing the trade secret is filed under seal and the trade secret is not disclosed except pursuant to court order.
4.2 Non-Solicitation of Employees. Each Participant agrees that, during his or her employment, and for a twelve (12) month period following the Termination Date, the Participant will not take any action, directly or indirectly (without the prior written consent of the Company), that causes or could reasonably be expected to cause any person who is then an employee of the Company or any of its affiliates to resign from the Company or any of its affiliates or to apply for or accept employment with any other business or enterprise.
4.3 Non-Solicitation of Clients. Each Participant agrees that, during his or her employment, and for a twelve (12) month period following the Participant’s Termination Date, the Participant will not, in any manner, directly or indirectly (without the prior written consent of the Company): (1) take any action that causes or could reasonably be expected to cause any client or prospective client of the Company or any of its affiliates to whom such Participant provided services or with whom such Participant otherwise had contact to become a client of or transact any business with a Competitive Business or reduce or refrain from doing any business with the Company or any of its affiliates, (2) transact business with any client or prospective client that would cause the Participant to be a Competitive Business or (3) interfere with or damage any relationship between the Company or any of its affiliates and a client or prospective client.
4.4 Non-Disparagement. Each Participant agrees and covenants that he or she will not at any time make, publish, or communicate to any person or entity or in any public forum any defamatory, maliciously false, or disparaging remarks, comments, or statements concerning the Company or any of its affiliates or their respective businesses, or any of their respective employees, officers, or directors. The preceding sentence does not in any way restrict or impede the Participant from exercising protected rights, to the extent that such rights cannot be waived by agreement or from complying with any applicable law or regulation or a valid order of a court of competent jurisdiction or an authorized government agency, provided that such compliance does not exceed that required by the law, regulation, or order.
4.5 Validity. The terms and provisions of this Section 4 are intended to be separate and divisible provisions and if, for any reason, any one or more of them is held to be invalid or unenforceable, neither the validity nor the enforceability of any other provision set forth herein will thereby be affected. If for any reason any court of competent jurisdiction finds any provision of this Section 4 unreasonable in duration or geographic scope or otherwise, the Participant and the Company agree that the restrictions and prohibitions contained herein will be effective to the fullest extent allowed under applicable law in such jurisdiction.
4.6 Injunctive Relief. Without limiting any remedies available to the Company, by acceptance of payments and benefits under the Plan, a Participant will be deemed to have agreed and acknowledged that a breach of the covenants contained in this Section 4 will
result in injury to the Company and its affiliates for which there is no adequate remedy at law and that it will not be possible to measure damages for such injuries precisely, and that therefore, in the event of such a breach or threat thereof, the Company will be entitled to seek a temporary restraining order and a preliminary and permanent injunction, without bond or other security, restraining the Participant from engaging in activities prohibited by this Section 4 or such other relief as may be required specifically to enforce any of the covenants in Sections 4.1, 4.2 and 4.3 herein. This provision will not, however, be construed as a waiver of any of the rights that the Company may have for damages under the Plan or otherwise, and, except as limited in Section 6.10, all of the Company’s rights and remedies will be unrestricted.
5.Claims for Benefits Under the Plan
5.1 Claims for Benefits under the Plan. If a Participant believes that he or she should have been eligible to participate in the Plan or disputes the amount of benefits under the Plan, such individual may submit a claim for benefits in writing to the Committee within sixty (60) days after the individual’s termination of employment. If such claim for benefits is wholly or partially denied, the Committee will within a reasonable period of time, but no later than ninety (90) days after receipt of the written claim, notify the individual of the denial of the claim. If an extension of time for processing the claim is required, the Committee may take up to an additional ninety (90) days; provided that the Committee sends the individual written notice of the extension before the expiration of the original 90-day period. The notice provided to the individual will describe why an extension is required and when a decision is expected to be made. If a claim is wholly or partially denied, the denial notice: (1) will be in writing, (2) will be written in a manner calculated to be understood by the individual and (3) will contain (a) the reasons for the denial, including specific reference to those Plan provisions on which the denial is based; (b) a description of any additional information necessary to complete the claim and an explanation of why such information is necessary; (c) an explanation of the steps to be taken to appeal the adverse determination; and (d) a statement of the individual’s right to request arbitration as set forth in Section 6.10, in lieu of bringing a civil action under Section 502(a) of ERISA, following an adverse decision after appeal. The Committee will have full discretion to deny or grant a claim in whole or in part. If notice of denial of a claim is not furnished in accordance with this Section 5.1, the claim will be deemed denied and the claimant will be permitted to exercise his or her rights to review pursuant to Sections 5.2 and 5.3.
5.2 Right to Request Review of Benefit Denial. Within sixty (60) days of the individual’s receipt of the written notice of denial of the claim, the individual may file a written request for a review of the denial of the individual’s claim for benefits. In connection with the individual’s appeal of the denial of his or her benefit, the individual may submit comments, records, documents or other information supporting the appeal, regardless of whether such information was considered in the prior benefits decision. Upon request and free of charge, the individual will be provided reasonable access to and copies of all documents, records and other information relevant to the claim.
5.3 Disposition of Claim. The Committee will deliver to the individual a written decision on the claim promptly, but not later than sixty (60) days after the receipt of the
individual’s written request for review, except that if there are special circumstances which require an extension of time for processing, the sixty (60)-day period will be extended to one hundred twenty (120) days; provided that the appeal reviewer sends written notice of the extension before the expiration of the original sixty (60)-day period. If the appeal is wholly or partially denied, the denial notice will: (1) be written in a manner calculated to be understood by the individual, (2) contain references to the specific Plan provision(s) upon which the decision was based, (3) contain a statement that, upon request and free of charge, the individual will be provided reasonable access to and copies of all documents, records and other information relevant to the claim for benefits and (4) contain a statement of the individual’s right to request arbitration as set forth in Section 6.10, in lieu of bringing a civil action under Section 502(a) of ERISA.
5.4 Exhaustion. An individual must exhaust the Plan’s claims procedures prior to proceeding with arbitration as set forth in Section 6.10.
6.Administration of the Plan
6.1 Administration. The Plan will be administered by the Committee or such other persons designated by the Board. The Committee will have the authority to select the Participants to be eligible for benefits under the Plan. The Committee is authorized to interpret the Plan, to establish, amend and rescind any rules and regulations relating to the Plan, and to make any other determinations that it deems necessary or desirable for the administration of the Plan; provided that any action permitted to be taken by the Committee may be taken by the Board, in its discretion. The Committee may correct any defect or omission or reconcile any inconsistency in the Plan in the manner and to the extent the Committee deems necessary or desirable. Any decision of the Committee in the interpretation and administration of the Plan during the Covered Period will be subject to de novo review without any presumption of correctness. The Committee may delegate to one or more employees of the Company or any of its affiliates the authority to take actions on its behalf pursuant to the Plan.
6.2 Amendment; Termination.
(a) The Plan may be amended at any time, provided, however, that unless the Participant otherwise agrees after being given notice of the Plan amendment, an amendment to the Plan pursuant to this paragraph that adversely and materially changes a benefit to a Participant is not effective as to that Participant until immediately after the end of the later of (i) twenty-four (24) months after the Company gives notice to the Participant of the change and of its effective date or (ii) the end of any Covered Period for the Participant that commenced before amendment of the Plan and that was ongoing at the time of amendment.
(b) The Plan may be amended at any time and in any manner necessary to comply with, or to avoid a material and adverse outcome for the Company or the Participants under, ERISA or Section 409A of the Code. Any such amendment will be effective immediately, or otherwise as provided by the Committee, without the consent of any Participant. If any such amendment is expected to have a material and adverse effect upon one or more Participants, the Company will
give notice of the change to those Participants within thirty days after effectiveness.
(c) The Plan may be terminated at any time. If the Plan is terminated, new Participants may not be added, but the Plan will continue in effect for each then-current Participant until immediately after the later of (i) twenty-four (24) months after termination of the Plan or (ii) the end of any Covered Period that commenced before termination of the Plan.
(d) Termination or amendment of the Plan will not affect any obligation of the Company under the Plan which has accrued and is unpaid as of the effective date of the termination or amendment.
6.3 Successors. The Company will require any successor or assignee, whether direct or indirect, by purchase, merger, consolidation or otherwise, to all or substantially all the business or assets of the Company, expressly and unconditionally to assume and agree to perform the Company’s obligations under the Plan, in the same manner and to the same extent that the Company would be required to perform if no succession or assignment had taken place. In such event, the term “Company,” as used in the Plan, will mean (from and after, but not before, the occurrence of such event) the Company as herein before defined and any successor or assignee to the business or assets which by reason hereof becomes bound by the terms and provisions of the Plan.
6.4 Third Party Beneficiaries. The Plan shall inure to the benefit of and be enforceable by the Participant’s personal or legal representatives, executors, administrators, successors, heirs and assigns.
6.5 FDIC Limitations. If any payment or benefit under the Plan would otherwise be a golden parachute payment within the meaning of section 18(k) of the Federal Deposit Insurance Act (a “Golden Parachute Payment”) that is prohibited by applicable law, then the payments and benefits will be reduced to the greatest amount that can be paid to the Participant without there being a prohibited Golden Parachute Payment. To the extent reasonably practicable, the Company shall seek the approval of the Federal Deposit Insurance Corporation, the Maryland Department of Labor - Office of the Commissioner of Financial Regulation and any other bank regulatory body, as necessary, to make any payment to the Participant that would otherwise constitute a Golden Parachute Payment.
6.6 Creditor Status of Participants. In the event that any Participant acquires a right to receive payments from the Company under the Plan, such right will be no greater than the right of any unsecured general creditor of the Company.
6.7 Notice of Address. Each Participant entitled to benefits under the Plan must file with the Company, in writing, his or her post office address and each change of post office address. Any communication, statement or notice addressed to such Participant at such address will be deemed sufficient for all purposes of the Plan, and there will be no obligation on the part of the Company to search for or to ascertain the location of such Participant.
6.8 Headings. The headings of the Plan are inserted for convenience and reference only and will have no effect upon the meaning of the provisions hereof.
6.9 Choice of Law. TO THE EXTENT NOT PREEMPTED BY THE LAWS OF THE UNITED STATES, THE LAWS OF THE STATE OF MARYLAND WILL BE THE CONTROLLING LAW IN ALL MATTERS RELATING TO THE PLAN, REGARDLESS OF THE CHOICE-OF-LAW RULES OF THE STATE OF MARYLAND OR ANY OTHER JURISDICTION.
6.10 Arbitration.
(a) Subject to the provisions of Section 4.6, any controversy or claim between a Participant and the Company arising out of or relating to or concerning the Plan (including the covenants contained in Section 4) and any dispute regarding such Participant’s employment or the termination thereof or any dispute regarding the application, interpretation or validity of the Plan will be finally settled by arbitration in a location determined by the Participant (which location must be located within the county in which the Participant primarily works) and administered by the American Arbitration Association (the “AAA”) under its Commercial Arbitration Rules then in effect. In the event of any conflict between the Plan and the rules of the AAA, the provisions of the Plan will be determinative. If the parties are unable to agree upon an arbitrator, they will select a single arbitrator from a list of seven (7) arbitrators designated by the office of the American Arbitration Association having responsibility for the location selected by the Participant, all of whom will be retired judges who are actively involved in hearing private cases or members of the National Academy of Arbitrators, and who, in either event, are residents of such forum. If the parties are unable to agree upon an arbitrator from such list, they will each strike names alternatively from the list, with the first to strike being determined by lot. After each party has used three (3) strikes, the remaining name on the list will be the arbitrator. The AAA’s Commercial Arbitration Rules will be modified in the following ways: (i) each arbitrator will agree to treat as confidential evidence and other information presented to them, (ii) there will be no authority to award punitive damages, (iii) there will be no authority to amend or modify the terms of the Plan and (iv) a decision must be rendered within ten (10) business days of the parties’ closing statements or submission of post-hearing briefs. The Participant or the Company may bring an action or special proceeding in a state or federal court of competent jurisdiction sitting in Montgomery County, Maryland or such other jurisdiction as the Participant may determine in his or her discretion to enforce any arbitration award under this Section 6.10.
(b) To the extent permitted by law, the Company shall reimburse the Participant on a current basis for all reasonable legal fees, costs of litigation and other related expenses incurred in good faith by the Participant as a result of the Company’s refusal to provide the severance benefits to which the Participant becomes entitled under the Plan, or as a result of the Company’s contesting the validity, enforceability or interpretation of the Plan; provided, however, that the Participant shall reimburse the Company for all such fees and expenses if an arbitration panel issues a final and non-appealable order setting forth the
determination that the position taken by the Participant was frivolous or advanced by the Participant in bad faith.
6.11 Withholding. All payments under the Plan will be subject to all applicable withholding of state, local, provincial and federal taxes.
6.12 No Implied Employment Contract. The Plan does not constitute a contract of employment or impose on a Participant any obligation to remain in the employ of the Company, nor does it impose on the Company or any of its affiliates any obligation to retain a Participant in his or her present or any other position, nor does it change the status of a Participant’s employment as an employee at will. Nothing in the Plan will in any way affect the right of the Company or any of its affiliates in its absolute discretion to change or reduce a Participant’s compensation at any time, or to change at any time one or more benefit plans, dental plans, health care plans, savings plans, bonus plans, vacation pay plans, disability plans and the like.
6.13 No Assignment. The rights of a Participant to payments or benefits under the Plan will not be made subject to option or assignment, either by voluntary or involuntary assignment or by operation of law, including (without limitation) bankruptcy, garnishment, attachment or other creditor’s process, and any action in violation of this Section 6.13 will be void.
6.14 Section 409A.
(a) General. The Plan is intended to comply with the requirements of Section 409A of the Code or an exemption or exclusion therefrom and, with respect to amounts that are subject to Section 409A of the Code, will in all respects be administered in accordance with Section 409A of the Code. The right to a series of payments under the Plan will be treated as a right to a series of separate payments. Each payment under the Plan that is made within 2-½ months following the end of the year that contains the Termination Date is intended to be exempt from Section 409A of the Code as a short-term deferral within the meaning of the final regulations under Section 409A of the Code. Each payment under the Plan that is made later than 2-½ months following the end of the year that contains the Participant’s Termination Date is intended to be exempt from Section 409A under the two-times exception of Treasury Reg. § 1.409A-1(b)(9)(iii), up to the limitation on the availability of that exception specified in the regulation. Then, each payment that is made after the two-times exception ceases to be available shall be subject to delay, in accordance with subsection (c) below. To the extent necessary to comply with Section 409A of the Code, all payments to be made upon a Participant’s Termination Date may only be made upon a “separation from service” within the meaning of Section 409A of the Code.
(b) In-Kind Benefits and Reimbursements. Notwithstanding anything to the contrary in the Plan, to the extent that any reimbursement or in-kind benefit provided under the Plan constitutes a “deferral of compensation” within the meaning of Section 409A of the Code (a “Reimbursement”), such Reimbursement will be made or provided in accordance with the requirements of Section 409A of
the Code, including, where applicable, the requirement that: (a) any Reimbursement is for expenses incurred during the Participant’s lifetime (or during a shorter period of time specified in the Plan or in any applicable Company expense reimbursement policy), (b) the amount of expenses eligible for Reimbursement during a calendar year may not affect the expenses eligible for Reimbursement in any other calendar year, (c) the Participant must submit a request for Reimbursement along with a supporting invoice at least ten (10) days before the end of the calendar year following the calendar year in which such fees and expenses were incurred, (d) subject to any shorter time period provided in any Company expense reimbursement policy or specifically provided otherwise in the Plan, the Reimbursement of an eligible expense will be made no later than the last day of the calendar year following the year in which the expense is incurred, and (e) the right to Reimbursement is not subject to liquidation or exchange for another benefit.
(c) Specified Employees. Notwithstanding anything in the Plan to the contrary, if the Participant is considered a “specified employee” (as such term is defined under Section 409A(a)(2)(B)(i) of the Code or any successor or comparable provision) on the date of the Participant’s “separation from service” (within the meaning of Section 409A of the Code), any payment that is subject to Section 409A of the Code and payable due to the Participant’s termination of employment will not be made to the Participant until the earlier of the six-month anniversary of the Participant’s “separation from service” within the meaning of Section 409A of the Code or the date of the Participant’s death and will be accumulated and paid on such date.
(d) No Participant Designation of Year of Payment. To the extent necessary to comply with Section 409A of the Code, in no event may a Participant, directly or indirectly, designate the taxable year of payment. In particular, to the extent necessary to comply with Section 409A of the Code, if any payment to a Participant under the Plan is conditioned upon the Participant’s executing and not revoking a Release and if the designated payment period for such payment begins in one taxable year and ends in the next taxable year, the payment will be made in the later taxable year.
EXHIBIT A
PARTICIPANTS AND SEVERANCE MULTIPLES | | | | | | | | | | | | | | |
| Participant | Severance Multiple |
Not During a
Covered Period | During a
Covered Period |
| Section 3.3(b) | Section 3.3(c) | Section 3.4(b) | Section 3.4(c) |
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Exhibit B
PARTICIPATION AGREEMENT
Reference is made to the Sandy Spring Bancorp, Inc. (“Company”) Executive Severance Plan (as the same may be amended or modified from time to time, the “Plan”). The Plan is incorporated in this Participation Agreement and is deemed to be a part hereof for all purposes. Unless otherwise defined herein, capitalized terms used in this Participation Agreement shall have the meanings set forth in the Plan.
Upon your execution and delivery to the Company of this Participation Agreement, you will become a Participant in the Plan. Your participation in the Plan is subject to the terms and conditions of the Plan. Pursuant to your participation in the Plan, you are eligible to receive severance benefits in accordance with the terms of the Plan.
Your severance multiple for change in control severance benefits under Section 3.4 of the Plan is “__.” Your severance multiple for non-change in control severance benefits under Section 3.3 of the Plan is “__.”
By signing below, you expressly agree to be bound by, and you promise to abide by, the terms of the Plan. You agree that the terms of the Plan are reasonable in all respects. You further acknowledge that receipt of severance benefits under the Plan is contingent upon your execution, delivery and non-revocation of a general release of claims as provided in the Plan.
You acknowledge and agree that the Plan and this Participation Agreement supersede all prior change‑in‑control and/or severance benefit policies, plans and arrangements of the Company, if any (and supersede all prior oral or written communications by the Company with respect to change‑in‑control benefits or severance benefits, if any), and any such prior policies, plans, arrangements and communications are hereby null and void and of no further force and effect with respect to your participation therein.
You further acknowledge and agree that before signing this Participation Agreement (a) you have fully read and you understand the Plan, (b) you have fully read, and you understand and voluntarily enter into, this Participation Agreement, and (c) you have had sufficient opportunity to consult with your personal tax, financial planning advisor and attorney about the tax, financial and legal consequences of your participation in the Plan.
This Participation Agreement may be executed in separate counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and the same instrument. This Participation Agreement shall be valid, binding, and enforceable against a party when executed by means of (a) an electronic signature; (b) an original manual signature; or (c) a faxed, scanned or photocopied manual signature. Each electronic signature or faxed, scanned, or photocopied manual signature shall have for all purposes the same validity, legal effect and admissibility in evidence as an original manual signature.
IN WITNESS WHEREOF, each of the parties has executed this Participation Agreement (in the case of the Company, by its duly authorized officer), as set forth below.
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| SANDY SPRING BANCORP, INC. | | PARTICIPANT: |
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| By: | | | | By: | | |
| Name: | | | | Name: | | |
| Title: | | | | Date: | | |
| Date: | | | | | | |