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PERFORMANCE COMPENSATION PLAN OF CARVER BANCORP, INC.
INCENTIVE AWARD AGREEMENT

       
-                           -
Name of Participant
     
Social Security Number
           
Street Address
                   
City
 
State
 
ZIP Code

This Incentive Award Agreement (“Agreement”) is intended to set forth the terms
and conditions on which a Incentive Award, consisting of certain cash payments,
has been granted under the Performance Compensation Plan of Carver Bancorp, Inc.
(“Plan”).  Set forth below are the specific terms and conditions applicable to
this Incentive Award.  Attached as Exhibit A is a copy of the Plan.

 
Incentive Award Terms
 
 
Grant Date:
 
 
Amount of Incentive Award ($):
 
 
Vesting Dates:*
         

*Subject to adjustment as provided in the Plan.  The Committee may, in its sole
discretion,  accelerate the vesting of the Incentive Award.

By signing where indicated below, Carver Bancorp, Inc. grants this Incentive
Award upon the terms and conditions specified in this Agreement, and the
Participant acknowledges receipt of this Agreement, including Exhibit A, and
agrees to observe and be bound by the terms and conditions set forth herein.

CARVER BANCORP, INC.
 
PARTICIPANT
               
By:
       
Name:
 
Name:
 
Title:
   

 

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Instructions: this page should be completed by or on behalf of the
Committee.  Any blank space intentionally left blank should be crossed out.
 
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EXHIBIT A
 
PERFORMANCE COMPENSATION PLAN
 
OF
 
CARVER BANCORP, INC.
 
 
1.
General Purpose of Plan.

 
The purpose of the Performance Compensation Plan of Carver Bancorp, Inc. (the
“Plan”) is to promote the growth and profitability of Carver Bancorp, Inc., (the
“Company”) and any of its respective Affiliates (collectively, the “Employer”)
to provide certain key officers of the Employer with an incentive to achieve
business objectives, and to attract and retain individuals of outstanding
competence.
 
2.
Terms of the Plan

 
Capitalized terms will be defined in the Carver Bancorp, Inc. 2006 Stock
Incentive Plan, as in effect from time to time, (the “Stock Plan”) unless
otherwise indicated.
 
3.
Eligibility.

 
For each fiscal year of the Company (“Plan Year”), beginning with the fiscal
year beginning on April 1, 2005 and ending on March 31, 2006, the Compensation
Committee of the Company (the “Committee”) shall designate certain officers or
employees of the Employer (“Eligible Employees”) who may be eligible to be
considered for an Incentive Payment (as described below) under this Plan. The
Eligible Employees for the first Plan Year are set forth in Appendix A to this
Plan, and such individuals shall continue to be Eligible Employees for
subsequent Plan Years unless the Committee shall determine otherwise.  An
individual who is an Eligible Employee for a Plan Year or Plan Years may be
excluded from participation in subsequent years at the discretion of the
Committee.
 
4.
Administration.

 
(a)           The Plan shall be administered by the Committee.
 
(b)           Subject to the terms and conditions of the Plan and such
limitations as may be imposed from time to time by the Board of Directors of the
Company, the Committee shall be responsible for the overall management and
administration of the Plan and shall have such authority as shall be necessary
or appropriate in order to carry out its responsibilities, including, without
limitation, the authority:
 
(i)           to interpret and construe the Plan and to determine all questions
that may arise under the Plan as to eligibility for participation in the Plan;

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(ii)           to adopt rules and regulations and to prescribe forms for the
operation and administration of the Plan; and
 
(iii)           to take any other action not inconsistent with the provisions of
the Plan that it may deem necessary or appropriate.
 
5.
Incentive Payments.

 
The Committee shall determine, in its sole discretion, whether a payment will be
awarded to a Participant in any Plan Year.  The amount, if any, awarded to each
Eligible Employee for a Plan Year (the “Incentive Payment”) shall be credited to
a memorandum account maintained by the Company for the benefit of such person
(the cumulative amount of an Eligible Employee’s Incentive Payments are referred
to herein as the Eligible Employee’s “Account Balance”).  No interest or
accruals, of any kind, will  be paid or credited to any Account Balance.
 
6.
Vesting.

 
Subject to the forfeiture provisions in this Section 6, each Incentive Payment
shall, as long as the Eligible Employee continues to be employed by an Employer,
vest 20% each year on the specified vesting date, until 100% vested on the
specified vesting date of the fifth year following the Plan Year earned.  If the
Eligible Employee’s employment with the Employer terminates, there shall be no
further increase in the Eligible Employee’s vesting percentage and any portion
of the Eligible Employee’s Incentive Payment that are not vested shall be
forfeited upon such termination.  Notwithstanding the foregoing, (a) the Account
Balance shall become fully vested at the effective time of the consummation of a
Change in Control (as defined in the Stock Plan) as long as the Employee is
employed on such effective date and (b) the Account Balance shall become fully
vested if the Eligible Employee’s employment with an Employer terminates by
reason of death or by reason of Disability of the Eligible Employee.  The
Committee may accelerate vesting at any time.
 
7.
Payment.

 
As described in Section 6, in the event of termination due to death, Disability,
or a Change in Control, the vested Account Balance shall be paid to the Eligible
Employee within 30 days following the termination of the Eligible Employee’s
employment with the Employer by whom the Eligible Employee is
employed.  Notwithstanding anything in the Plan to the contrary, all vested
portions under the Plan shall be paid in cash, subject to applicable withholding
taxes, as soon as practicable following the specified vesting date but in no
event later than 15th day of the third month of the year immediately following
the Plan Year.
 
8.
Amendment and Termination.

 
The Board may amend, suspend or terminate the Plan in whole or in part at any
time by giving written notice of such amendment, suspension or termination to
the Committee.
 
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9.
Miscellaneous.

 
(a)           Status as an Employee Benefit Plan.  This Plan is not intended to
satisfy the requirements for qualification under Section 401(a) of the Code or
to satisfy the definitional requirements for an “employee benefit plan” under
Section 3(3) of ERISA.  It is intended to be a non-qualified incentive
compensation program that is exempt from the regulatory requirements of
ERISA.  The Plan shall be construed and administered so as to effectuate this
intent.
 
(b)           Compliance with Section 409A of the Code. To the extent that the
Plan, the Incentive Award Agreement and/or any Incentive Payments granted or
awarded under the Plan are construed to be non-qualified deferred compensation
plans described in Section 409A of the Code, the Plan, the Incentive Award
Agreement and any Incentive Payments as applicable, shall be operated,
administered and construed so as to comply with the requirements of Section 409A
of the Code.  The Plan, the Incentive Award Agreement and any Incentive Payments
shall be subject to amendment, with or without advance notice to the Eligible
Employees and on a prospective or retroactive basis, including, but not limited
to, amendment in a manner that adversely affects the rights of the Eligible
Employees to the extent necessary to effect compliance with Section 409A of the
Code.
 
(c)           No Right to Continued Employment. Neither the establishment of the
Plan nor any provisions of the Plan nor any action of the Board or the Committee
with respect to the Plan shall be held or construed to confer upon any Eligible
Employee any right to a continuation of his or her position as an employee of
the Employer.  The Employer reserves the right to dismiss any Eligible Employee
or otherwise deal with any Eligible Employee to the same extent as though the
Plan had not been adopted.
 
(d)           Construction of Language.  Whenever appropriate in the Plan, words
used in the singular may be read in the plural, words used in the plural may be
read in the singular, and words importing the masculine gender may be read as
referring equally to the feminine or the neuter. Any reference to a section
number shall refer to a section of this Plan unless otherwise indicated.
 
(e)           Governing Law.  The Plan shall be construed, administered and
enforced according in the laws of the State of New York without giving effect to
the conflict of laws principles thereof, except to the extent that such laws are
preempted by federal law.
 
(f)           Headings.  The headings of sections are included solely for
convenience of reference. If there is any conflict between such headings and the
text of the Plan, the text shall control.
 
(g)           Taxes.  The Employer shall have the right to deduct from all
amounts paid by the Employer as an Incentive Payment under the Plan any taxes
required by law to be withheld with respect to such award.
 
(h)           Notices.  Any communication required or permitted to be given
under the Plan, including any notice, direction, designation, comment,
instruction, objection or waiver, shall be in writing and shall be deemed to
have been given at such time as it is delivered personally or five days after
mailing if mailed, postage prepaid, by registered or certified mail, return
receipt requested, addressed to such party at the address listed below, or at
such other address as one such party may by written notice specify to the other
party:
 
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(i)
If to the Committee:

 
Carver Bancorp, Inc.
75 West 125th Street
New York, New York  10027
 
Attention: Human Resources Department

(ii)           If to an Eligible Employee, to the Eligible Employee’s address as
shown in the Employer’s records.
 
IN WITNESS WHEREOF, the Company adopts this Plan and causes this instrument to
be executed as of December 14, 2006.
 

 
CARVER BANCORP, INC.
         
By: /s/ Margaret D. Roberts
 
Name: Margaret D. Roberts
 
Title: SVP & Chief Human Resources Officer

 
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Appendix A

Eligible Employees for the first Plan Year are:

 
§
James H. Bason

 
§
Godofredo  Benedicto

 
§
Bridgette  Bowie

 
§
Thomas  Burns

 
§
Frederica  Clark

 
§
Mark  Davis

 
§
Frank  Deaton

 
§
Carmelo  Felix

 
§
Tara  Hickson

 
§
Savatrie  Jagroop

 
§
Margaret D. Roberts

 
§
Odell  Rutherford

 
§
Patsy  Simmons

 
§
Jeffrey K. Stanton

 
§
Roy  Swan

 
§
Gwendolyn  Watts

 
§
Timothy  Williams

 
§
Deborah C. Wright

Such individuals shall continue to be Eligible Employees for subsequent Plan
Years unless the Committee shall determine otherwise.  An individual who is an
Eligible Employee for a Plan Year or Plan Years may be excluded from
participation in subsequent years at the discretion of the Committee.
 
 
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