AGREEMENT

 

Agreement effective as of December 1, 2008, between Flushing Savings Bank, FSB,
a federal savings bank (the “Bank”), Flushing Financial Corporation, a Delaware
corporation (the “Company”) and Gerard P. Tully, Sr. (“Mr. Tully”).

 

WITNESSETH:

 

 

A.

Mr. Tully is Chairman of the Board of Directors of the Bank and

Chairman of the Board of Directors of the Company (collectively referred to as
“Chairman”);

 

 

B.

The Bank and Company recognize that Mr. Tully, as Chairman,

devotes substantial time to the business affairs of the Bank and the Company
above and beyond that required of directors; and

 

 

C.

The Bank and the Company desire to have availability the

leadership, advice and counsel of Mr. Tully and the parties wish to formalize
the arrangement whereby Mr. Tully receives compensation for his additional
services as Chairman.

 

NOW, THEREFORE, in consideration of the premises and of the mutual

covenants herein contained, the parties hereto agree as follows:

 

 

1.

Term. The term of this Agreement shall commence on December 1, 2008

and end on November 30, 2009, unless the Agreement is terminated earlier as
provided in Section 7.

 

 

2.

Services. During the term of this Agreement, Mr. Tully shall consult with

and advise the officers of the Bank and the Company and their respective Boards
concerning the business and financial affairs of the Bank and Company. Mr. Tully
shall be free to exercise his own discretion and judgment in the performance of
such services and with respect to the time, place, method, and manner of
performance, subject to his fiduciary obligations to the Bank and the Company as
a director and Chairman. Mr. Tully is expected periodically to meet in person
and to confer by telephone with Senior Officers, but shall not be required to
perform all of such services on the premises of the Bank or the Company.

 

 

3.

Compensation. During the term of this Agreement, the Bank and the

Company will pay Mr. Tully an aggregate fee of $13,333.33 per month. Payment
will be made on the last business day of the month for which the fee is paid.

 

 

4.

Expenses. Mr. Tully shall be reimbursed for expenses reasonable and

necessarily incurred by him in connection with the performance of his services
under this Agreement, in accordance with the Bank’s and the Company’s then
applicable polices and procedures (but in no event later than the last day of
the calendar year next following the calendar year in which the expenses were
incurred). Reimbursement of expenses for any calendar year shall not affect the
amount eligible for reimbursement in any other calendar year, and such
reimbursement may not be exchanged for cash or another benefit. Mr. Tully shall
furnish the Bank and the Company with appropriate documentation required by the
Internal Revenue Code and regulations

 

60443684_2.DOC

 

--------------------------------------------------------------------------------

thereunder or otherwise reasonably required under the Bank’s and the Company’s
policies in connection with such expenses.

 

 

5.

Independent Contractor Status. Mr. Tully’s services under this Agreement

shall be provided by him as an independent contractor in his capacity as
Chairman. Nothing contained in this Agreement or in the performance of the
services hereunder shall be construed as creating the relationship of the
employer and employee between the Bank or the Company and Mr. Tully. Mr. Tully
understands that he will not be entitled to receive any insurance or other
employee benefits provided by the Bank and the Company to its employees. The
Bank and the Company shall not withhold federal, state of local taxes with
respect to the compensation payable to Mr. Tully under this Agreement.

 

 

6.

Termination. This Agreement shall terminate immediately in the event

Mr. Tully ceases to be Chairman. Upon such termination, Mr. Tully shall be paid
any amounts then due under Sections 3 and 4, including his full monthly fee the
month in which the termination occurred without regard to the day of the month
on which it occurred. Notwithstanding the preceding sentence, in the event Mr.
Tully ceases to be Chairman within three months following a “Change in Control”,
as defined in the 1996 Restricted Stock Incentive Plan of Flushing Financial
Corporation, then upon termination of this Agreement, Mr. Tully shall be paid in
one lump sum the amount of the aggregate fees that Mr. Tully would have earned
if he had continued to serve until the end of the term of this Agreement, either
as stated in Section 1 or as later extended.

 

 

7.

Entire Agreement; Modifications. This Agreement supersedes the Agreement

between the parties dated as of December 1, 1995, as amended, and contains the
entire understanding between the parties with respect to the subject matter
hereof, and may not be altered, varied, revised, or amended except by an
instrument in writing signed by Mr. Tully, the Bank and the Company subsequent
to the date of this Agreement.

 

 

8.

Assignment. This Agreement is for the personal services of Mr. Tully

and shall not be assignable by Mr. Tully.

 

IN WITNESS WHEREOF, Mr. Tully, the Bank and the Company have caused this
Agreement to be executed as of this 18th day of November, 2008.

 

 

FLUSHING SAVINGS BANK, FSB

 

By:_/s/ John R. Buran__________________

 

FLUSHING FINANCIAL CORPORATION

 

By:_/s/ John R. Buran__________________

 

_/s/ Gerard P. Tully, Sr._________________

Gerard P. Tully, Sr.

 

60443684_2.DOC