Exhibit 10.9


 


 


 


BROOKLINE BANK


EMPLOYEE STOCK OWNERSHIP PLAN


 


Originally Adopted Effective November 1, 1997


Amended and Restated Effective January 1, 2006










 



 


BROOKLINE BANK

EMPLOYEE STOCK OWNERSHIP PLAN


This restated Employee Stock Ownership Plan, executed
on the 15th day of June, 2006, by Brookline Bank, a federally-chartered stock
savings bank (the “Bank”),


W I T N E S S E T H  
T H A T


WHEREAS, the Board of Directors of the Bank (“Board”)
initially adopted an employee stock ownership plan (“Plan”) for the benefit of
eligible employees on November 1, 1997; and


WHEREAS, the Plan has been amended on numerous
occasions and the Board desires to further amend the Plan and to submit the
Plan to the Internal Revenue Service for a favorable determination on its
qualification under the provisions of the Economic Growth and Tax Relief
Reconciliation Act of 2001 (“EGTRRA”); and


WHEREAS, the Board has resolved to adopt this
restated employee stock ownership plan in accordance with the terms and
conditions presented to the Board;


NOW, THEREFORE, the Bank hereby adopts the following
Plan setting forth the terms and conditions pertaining to contributions by the
Employer and the payment of benefits to Participants and Beneficiaries.


IN WITNESS WHEREOF, the Bank has adopted this Plan
and caused this instrument to be executed by its duly authorized officers as of
the above date.


	
  

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ Richard P. Chapman, Jr.

  
	
   

  	
   

  	
  Authorized Officer

  



 


















C 0 N T E N T S


 


	
  

  	
   

  	
   

  	
   

  	
  Page No.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 1.

  	
   

  	
  Plan Identity

  	
   

  	
  1

  
	
  1.1

  	
   

  	
  Name

  	
   

  	
  1

  
	
  1.2

  	
   

  	
  Purpose

  	
   

  	
  1

  
	
  1.3

  	
   

  	
  Effective Date

  	
   

  	
  1

  
	
  1.4

  	
   

  	
  Fiscal Period

  	
   

  	
  1

  
	
  1.5

  	
   

  	
  Single Plan for All Employers

  	
   

  	
  1

  
	
  1.6

  	
   

  	
  Interpretation of Provisions

  	
   

  	
  1

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 2.

  	
   

  	
  Definitions

  	
   

  	
  1

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 3.

  	
   

  	
  Eligibility for Participation

  	
   

  	
  10

  
	
  3.1

  	
   

  	
  Initial Eligibility

  	
   

  	
  10

  
	
  3.2

  	
   

  	
  Definition of Eligibility Year

  	
   

  	
  10

  
	
  3.3

  	
   

  	
  Terminated Employees

  	
   

  	
  11

  
	
  3.4

  	
   

  	
  Certain Employees Ineligible

  	
   

  	
  11

  
	
  3.5

  	
   

  	
  Participation and Reparticipation

  	
   

  	
  11

  
	
  3.6

  	
   

  	
  Omission of Eligible Employee

  	
   

  	
  11

  
	
  3.7

  	
   

  	
  Inclusion of Ineligible Employee

  	
   

  	
  11

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 4.

  	
   

  	
  Contributions, Credits and Release of Shares

  	
   

  	
  11

  
	
  4.1

  	
   

  	
  Employer Discretionary Contributions

  	
   

  	
  11

  
	
  4.2

  	
   

  	
  Contributions for Stock Obligations

  	
   

  	
  13

  
	
  4.3

  	
   

  	
  Conditions as to Contributions

  	
   

  	
  13

  
	
  4.4

  	
   

  	
  Transfers

  	
   

  	
  13

  
	
  4.5

  	
   

  	
  Release of Shares

  	
   

  	
  13

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 5.

  	
   

  	
  Limitations on Contributions and Allocations

  	
   

  	
  14

  
	
  5.1

  	
   

  	
  Limitation on Annual Additions

  	
   

  	
  14

  
	
  5.2

  	
   

  	
  Effect of Limitations

  	
   

  	
  16

  
	
  5.3

  	
   

  	
  Limitations as to Certain Participants

  	
   

  	
  16

  
	
  5.4

  	
   

  	
  Allocations Upon a Change in Control

  	
   

  	
  17

  
	
  5.5

  	
   

  	
  Dividend Recharacterization

  	
   

  	
  17

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 6.

  	
   

  	
  Trust Fund and Its Investment

  	
   

  	
  17

  
	
  6.1

  	
   

  	
  Creation of Trust Fund

  	
   

  	
  17

  
	
  6.2

  	
   

  	
  Stock Fund and Investment Fund

  	
   

  	
  17

  
	
  6.3

  	
   

  	
  Acquisition of Stock

  	
   

  	
  18

  
	
  6.4

  	
   

  	
  Participants' Option to Diversify

  	
   

  	
  19

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 7.

  	
   

  	
  Voting Rights and Dividends on Stock

  	
   

  	
  19

  



 



 i
 








 


	
  7.1

  	
   

  	
  Voting and Tendering of Stock

  	
   

  	
  19

  
	
  7.2

  	
   

  	
  Dividends on Stock

  	
   

  	
  20

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 8.

  	
   

  	
  Adjustments to Accounts

  	
   

  	
  21

  
	
  8.1

  	
   

  	
  Adjustments for Transactions

  	
   

  	
  21

  
	
  8.2

  	
   

  	
  Valuation of Investment Fund

  	
   

  	
  21

  
	
  8.3

  	
   

  	
  Adjustments for Investment Experience

  	
   

  	
  21

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 9.

  	
   

  	
  Vesting of Participants' Interests

  	
   

  	
  22

  
	
  9.3

  	
   

  	
  Full Vesting Upon Certain Events

  	
   

  	
  23

  
	
  9.4

  	
   

  	
  Full Vesting Upon Plan Termination

  	
   

  	
  24

  
	
  9.5

  	
   

  	
  Forfeiture, Repayment, and Restoral

  	
   

  	
  24

  
	
  9.6

  	
   

  	
  Accounting for Forfeitures

  	
   

  	
  24

  
	
  9.7

  	
   

  	
  Vesting and Nonforfeitability

  	
   

  	
  25

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 10.

  	
   

  	
  Payment of Benefits

  	
   

  	
  25

  
	
  10.1

  	
   

  	
  Benefits for Participants

  	
   

  	
  25

  
	
  10.2

  	
   

  	
  Time for Distribution

  	
   

  	
  25

  
	
  10.3

  	
   

  	
  Marital Status

  	
   

  	
  27

  
	
  10.4

  	
   

  	
  Delay in Benefit Determination

  	
   

  	
  27

  
	
  10.5

  	
   

  	
  Accounting for Benefit Payments

  	
   

  	
  27

  
	
  10.6

  	
   

  	
  Options to Receive and Sell Stock

  	
   

  	
  27

  
	
  10.7

  	
   

  	
  Restrictions on Disposition of Stock

  	
   

  	
  28

  
	
  10.8

  	
   

  	
  Continuing Loan Provisions; Creations of Protections
  and Rights

  	
   

  	
  28

  
	
  10.9

  	
   

  	
  Direct Rollover of Eligible Distribution

  	
   

  	
  28

  
	
  10.10

  	
   

  	
  Waiver of 30 Day Period After Notice of Distribution

  	
   

  	
  29

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 11.

  	
   

  	
  Rules Governing Benefit Claims and Review of Appeals

  	
   

  	
  30

  
	
  11.1

  	
   

  	
  Claim for Benefits

  	
   

  	
  30

  
	
  11.2

  	
   

  	
  Notification by Committee

  	
   

  	
  30

  
	
  11.3

  	
   

  	
  Claims Review Procedure

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 12.

  	
   

  	
  The Committee and Its Functions

  	
   

  	
  31

  
	
  12.1

  	
   

  	
  Authority of Committee

  	
   

  	
  31

  
	
  12.2

  	
   

  	
  Identity of Committee

  	
   

  	
  31

  
	
  12.3

  	
   

  	
  Duties of Committee

  	
   

  	
  31

  
	
  12.4

  	
   

  	
  Valuation of Stock

  	
   

  	
  32

  
	
  12.5

  	
   

  	
  Compliance with ERISA

  	
   

  	
  32

  
	
  12.6

  	
   

  	
  Action by Committee

  	
   

  	
  32

  
	
  12.7

  	
   

  	
  Execution of Documents

  	
   

  	
  32

  
	
  12.8

  	
   

  	
  Adoption of Rules

  	
   

  	
  32

  
	
  12.9

  	
   

  	
  Responsibilities to Participants

  	
   

  	
  32

  
	
  12.10

  	
   

  	
  Alternative Payees in Event of Incapacity

  	
   

  	
  32

  
	
  12.11

  	
   

  	
  Indemnification by Employers

  	
   

  	
  33

  
	
  12.12

  	
   

  	
  Nonparticipation by Interested Member

  	
   

  	
  33

  



 



 ii
 








 


	
  

  	
   

  	
   

  	
   

  	
   

  
	
  Section 13.

  	
   

  	
  Adoption, Amendment, or Termination of the Plan

  	
   

  	
  33

  
	
  13.1

  	
   

  	
  Adoption of Plan by Other Employers

  	
   

  	
  33

  
	
  13.2

  	
   

  	
  Adoption of Plan by Successor

  	
   

  	
  33

  
	
  13.3

  	
   

  	
  Plan Adoption Subject to Qualification

  	
   

  	
  33

  
	
  13.4

  	
   

  	
  Right to Amend or Terminate

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 14.

  	
   

  	
  Miscellaneous Provisions

  	
   

  	
  34

  
	
  14.1

  	
   

  	
  Plan Creates No Employment Rights

  	
   

  	
  34

  
	
  14.2

  	
   

  	
  Nonassignability of Benefits

  	
   

  	
  34

  
	
  14.3

  	
   

  	
  Limit of Employer Liability

  	
   

  	
  35

  
	
  14.4

  	
   

  	
  Treatment of Expenses

  	
   

  	
  35

  
	
  14.5

  	
   

  	
  Number and Gender

  	
   

  	
  35

  
	
  14.6

  	
   

  	
  Nondiversion of Assets

  	
   

  	
  35

  
	
  14.7

  	
   

  	
  Separability of Provisions

  	
   

  	
  35

  
	
  14.8

  	
   

  	
  Service of Process

  	
   

  	
  35

  
	
  14.9

  	
   

  	
  Governing Law

  	
   

  	
  35

  
	
  14.10

  	
   

  	
  Employer Contributions Conditioned on Deductibility

  	
   

  	
  35

  
	
  14.11

  	
   

  	
  Unclaimed Accounts

  	
   

  	
  35

  
	
  14.12

  	
   

  	
  Qualified Domestic Relations Order

  	
   

  	
  36

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Section 15.

  	
   

  	
  Top-Heavy Provisions

  	
   

  	
  37

  
	
  15.1

  	
   

  	
  Top-Heavy Plan

  	
   

  	
  37

  
	
  15.2

  	
   

  	
  Super Top-Heavy Plan

  	
   

  	
  37

  
	
  15.3

  	
   

  	
  Definitions

  	
   

  	
  37

  
	
  15.4

  	
   

  	
  Top-Heavy Rules of Application

  	
   

  	
  39

  
	
  15.5

  	
   

  	
  Top-Heavy Ratio

  	
   

  	
  40

  
	
  15.7

  	
   

  	
  Minimum Vesting

  	
   

  	
  41

  
	
  15.8

  	
   

  	
  Top-Heavy Provisions Control in Top-Heavy Plan

  	
   

  	
  42

  



 



 iii















 


BROOKLINE BANK

EMPLOYEE STOCK OWNERSHIP PLAN


Section 1.  Plan Identity.


1.1  Name. 
The name of this Plan is “Brookline Bank Employee Stock Ownership Plan.”


1.2  Purpose.  The purpose of this Plan is to describe the
terms and conditions under which contributions made pursuant to the Plan will
be credited and paid to the Participants and their Beneficiaries.


1.3  Effective Date.  The Effective Date of this Plan was,
initially, November 1, 1997.  The
Effective Date of this amendment and restatement is January 1, 2006, unless
otherwise set forth herein.


1.4  Fiscal Period.  This Plan shall be operated on the basis of a
January 1 to December 31 fiscal year for the purpose of keeping the Plan’s
books and records and distributing or filing any reports or returns required by
law.


1.5  Single Plan for All Employers.  This Plan shall be treated as a single plan
with respect to all participating Employers for the purpose of crediting
contributions and forfeitures and distributing benefits, determining whether
there has been any termination of Service, and applying the limitations set
forth in Section 5.


1.6  Interpretation of Provisions.  The Employer intends this Plan and the Trust
to be a qualified stock bonus plan under Section 401(a) of the Code and an
employee stock ownership plan within the meaning of Section 407(d)(6) of ERISA
and Section 4975(e)(7) of the Code.  The
Plan is intended to have its assets invested primarily in qualifying employer
securities of one or more Employers within the meaning of Section 407(d)(3) of
ERISA, and to satisfy any requirement under ERISA or the Code applicable to
such a plan.


Accordingly, the Plan and Trust Agreement shall be
interpreted and applied in a manner consistent with this intent and shall be
administered at all times and in all respects in a nondiscriminatory manner.


Section 2.  Definitions.


The following capitalized words and phrases shall
have the meanings specified when used in this Plan and in the Trust Agreement,
unless the context clearly indicates otherwise:


“Account” means a Participant’s interest in the assets
accumulated under this Plan as expressed in terms of a separate account balance
which is periodically adjusted to reflect his Employer’s contributions, the
Plan’s investment experience, and distributions and forfeitures.









 



 


“Active Participant” means a Participant who has satisfied the
eligibility requirements under Section 3 and who has at least 1000 Hours of
Service during the current Plan Year. 
However, a Participant shall not qualify as an Active Participant unless
(i) he is in active Service with an Employer as of the last day of the Plan
Year, or (ii) he is on a Recognized Absence as of that date, or (iii) his
Service terminated during the Plan Year by reason of Disability, death, Early
or Normal Retirement.


“Bank” means Brookline Bank (formerly Brookline
Savings Bank) and any entity which succeeds to the business of Brookline Bank
and adopts this Plan as its own pursuant to Section 13.2.


“Beneficiary” means the person or persons who are
designated by a Participant to receive benefits payable under the Plan on the
Participant’s death.  In the absence of
any designation or if all the designated Beneficiaries shall die before the
Participant dies or shall die before all benefits have been paid, the
Participant’s Beneficiary shall be his surviving Spouse, if any, or his estate
if he is not survived by a Spouse.  The
Committee may rely upon the advice of the Participant’s executor or
administrator as to the identity of the Participant’s Spouse.


“Break in Service” means any Plan Year in which an Employee has
500 or fewer Hours of Service.  Solely
for this purpose, an Employee shall be considered employed for his normal hours
of paid employment during a Recognized Absence (said Employee shall not be
credited with more than 501 Hours of Service to avoid a Break in Service),
unless he does not resume his Service at the end of the Recognized
Absence.  Further, if an Employee is
absent for any period beginning on or after January 1, 1985, (i) by reason of
the Employee’s pregnancy, (ii) by reason of the birth of the Employee’s child,
(iii) by reason of the placement of a child with the Employee in connection
with the Employee’s adoption of the child, or (iv) for purposes of caring for
such child for a period beginning immediately after such birth or placement,
the Employee shall be credited with the Hours of Service which would normally
have been credited but for such absence, up to a maximum of 501 Hours of
Service.


“Cash Compensation” means a Participant’s 415 Compensation as defined
in Section 2 of the Plan, excluding cash payments made pursuant to any dividend
equivalent rights awarded to Employees pursuant to a stock option plan adopted
by the Company or an affiliate.


“Code” means the Internal Revenue Code of 1986, as
amended.


“Committee” means the committee responsible for the
administration of this Plan in accordance with Section 12.


“Company” means Brookline Bancorp, Inc., the stock
holding company of Bank.


“Disability” means only a disability which renders the
Participant totally unable, as a result of bodily or mental disease or injury,
to perform any duties for an Employer for which he is reasonably fitted, which
disability is expected to be permanent or of long and indefinite duration.  However, this term shall not include any
disability directly or indirectly resulting from or related to habitual
drunkenness or addiction to narcotics, a criminal act or attempt, service in 



 2
 






 



the armed forces of any country, an act of war,
declared or undeclared, any injury or disease occurring while compensation to
the Participant is suspended, or any injury which is intentionally
self-inflicted.  Further, this term shall
apply only if (i) the Participant is sufficiently disabled to qualify for the payment
of disability benefits under the federal Social Security Act or Veterans
Disability Act, or (ii) the Participant’s disability is certified by a
physician selected by the Committee. 
Unless the Participant is sufficiently disabled to qualify for
disability benefits under the federal Social Security Act or Veterans
Disability Act, the Committee may require the Participant to be appropriately
examined from time to time by one or more physicians chosen by the Committee,
and no Participant who refuses to be examined shall be treated as having a
Disability.  In any event, the Committee’s
good faith decision as to whether a Participant’s Service has been terminated
by Disability shall be final and conclusive.


“Early Retirement” means retirement on or after a Participant’s
attainment of age 55 and the completion of ten years of Service for an
Employer.  If the Participant separates
from Service before satisfying the age requirement, but has satisfied the
Service requirement, the Participant will be entitled to elect early retirement
upon satisfaction of the age requirement.


“Effective Date” means, originally, November 1, 1997.  The Effective Date of the Plan’s amendment
and restatement is January 1, 2006.


“Employee” means any individual who is or has been
employed or self-employed by an Employer, including a Leased Employee.  However, if Leased Employees constitute less
than 20% of the Employer’s “non-highly compensated workforce” (as that term is
defined in Section 414(n)(5)(c)(ii) of the Code), then the term “Employee”
shall not include any Leased Employees who are covered by a plan described in
Section 414(n)(5)(B) of the Code which is maintained by the leasing
organization.


“Employer” means the Bank or any affiliate (within the
purview of section 414(b), (c) or (m) and 415(h) of the Code) which adopts this
Plan with the Bank’s consent pursuant to Section 13.1 or any other corporation,
partnership, or proprietorship which adopts this Plan with the Bank’s consent
pursuant to Section 13.1, and any entity which succeeds to the business of the
Employer and adopts the Plan pursuant to Section 13.2.


“Entry Date” means each January 1 and July 1 of each Plan
Year.


“ERISA” means the Employee Retirement Income
Security Act of 1974 (P.L. 93-406, as amended).


“415 Compensation” shall mean a Participant’s wages, salaries,
fees for professional services and other amounts received (without regard to
whether an amount is paid in cash) for personal services actually rendered in
the course of employment with the Employer while a Participant in the Plan to
the extent that the amounts are includable in gross income (including, but not
limited to, commissions paid to salesmen, compensation for services on the
basis of a percentage of profits, commissions on insurance premiums, tips,
bonuses, severance payments and amounts paid as a result of termination, fringe
benefits, reimbursements or other expense allowances under a non accountable
plan (as described in Section 1.62-2(c) of the Treasury 



 3
 






 



Regulations), any elective deferral (as defined in
Code Section 402(g)(3) and any amount which is contributed or deferred by the
employer at the election of the employee and which is not includable in the
gross income of the Employee by reason of Code Section 125 (Cafeteria Plan),
Code Section 457, and Code Section 132(f)(4), and excluding the following:


(i)                                     Any distributions from a plan of deferred
compensation are not considered as compensation for Code Section 415 purposes,
regardless of whether such amounts are includable in the gross income of the
Employee when distributed.  However, any
amounts received by an Employee pursuant to an unfunded non-qualified plan may
be considered as compensation for Code Section 415 purposes in the year such
amounts are includable in the gross income of the Employee.


(ii)                                  Amounts realized from the exercise of a
non-qualified stock option, or when restricted stock (or property) held by an
Employee either becomes freely transferable or is no longer subject to a
substantial risk of forfeiture.


(iii)                               Amounts realized from the sale, exchange or
other disposition of stock acquired under a qualified stock option.


(iv)                              Other amounts which receive special tax
benefits, such as premiums for group term life insurance (but only to the
extent that the premiums are not includable in the gross income of the
Employee).


415 Compensation in excess of $160,000 (as indexed)
shall be disregarded for all Participants. 
For purposes of this sub-section, the $160,000 limit shall be referred
to as the “applicable limit” for the Plan Year in questions.  For Plan Years commencing on or after January
1, 2002, “$200,000” shall be substituted for “$160,000” wherever it appears in
this paragraph.  Such amount shall be
adjusted in such manner as permitted under Code Section 401(a)(17)(B),
effective for the Plan Year that begins within the applicable calendar year.
For purposes of the applicable limit, 415 Compensation shall be prorated over
short Plan Years.


“Highly Paid Employee” for any Plan Year means an Employee who,
during either of that or the immediately preceding Plan Year was at any time a
five percent owner of the Employer (as defined in Code Section 416(i)(1)) or,
for the immediately preceding Plan Year, had 415 Compensation exceeding $95,000
(adjusted in accordance with Code Section 414(q)(l)) and was among the most
highly compensated one-fifth of all Employees. 
For this purpose:


(a)                  “415
Compensation” shall include any amount which is excludable from the Employee’s
gross income for tax purposes pursuant to Sections 125, 402(a)(8),
402(h)(1)(B),  403(b), or Section
132(f)(4) of the Code.


(b)                  The
number of Employees in “the most highly compensated one-fifth of all Employees”
shall be determined by taking into account all individuals working for all
related Employer entities described in the definition of “Service”, but excluding
any individual who has not completed six months of Service, who normally works
fewer than 



 4
 






 



17-1/2 hours per week or in
fewer than six months per year, who has not reached age 21, whose employment is
covered by a collective bargaining agreement, or who is a nonresident alien who
receives no earned income from United States sources.


“Hours of Service” means hours to be credited to an Employee
under the following rules:


(a)                  Each
hour for which an Employee is paid or is entitled to be paid for services to an
Employer is an Hour of Service.


(b)                  Each
hour for which an Employee is directly or indirectly paid or is entitled to be
paid for a period of vacation, holidays, illness, disability, lay-off, jury
duty, temporary military duty, or leave of absence is an Hour of Service.  However, except as otherwise specifically
provided, no more than 501 Hours of Service shall be credited for any single
continuous period which an Employee performs no duties.  No more than 501 Hours of Service will be
credited under this paragraph for any single continuous period (whether or not
such period occurs in a single computation period).  Further, no Hours of Service shall be
credited on account of payments made solely under a plan maintained to comply
with worker’s compensation, unemployment compensation, or disability insurance
laws, or to reimburse an Employee for medical expenses.


(c)                  Each
hour for which back pay (ignoring any mitigation of damages) is either awarded
or agreed to by an Employer is an Hour of Service.  However, no more than 501 Hours of Service
shall be credited for any single continuous period during which an Employee
would not have performed any duties.  The
same Hours of Service will not be credited both under paragraph (a) or (b) as
the case may be, and under this paragraph (c). 
These hours will be credited to the employee for the computation period
or periods to which the award or agreement pertains rather than the computation
period in which the award agreement or payment is made.


(d)                  Hours
of Service shall be credited in any one period only under one of the foregoing
paragraphs (a), (b) and (c); an Employee may not get double credit for the same
period.


(e)                  If
an Employer finds it impractical to count the actual Hours of Service for any
class or group of non-hourly Employees, each Employee in that class or  group shall be credited with 45 Hours of
Service for each weekly pay period in which he has at least one Hour of
Service.  However, an Employee shall be
credited only for his normal working hours during a paid absence.


(f)                   Hours
of Service to be credited on account of a payment to an Employee (including
back pay) shall be recorded in the period of Service for which the payment was
made.  If the period overlaps two or more
Plan Years, the Hours of Service credit shall be allocated in proportion to the
respective portions of the period included in the several Plan Years.  However, in the case of periods of 31 days or
less, the Administrator 



 5
 






 



may apply a uniform policy
of crediting the Hours of Service to either the first Plan Year or the second.


(g)                  In
all respects an Employee’s Hours of Service shall be counted as required by
Section 2530.200b-2(b) and (c) of the Department of Labor’s regulations under
Title I of ERISA.


“Investment Fund” means that portion of the Trust Fund
consisting of assets other than Stock. 
Notwithstanding the above, assets from the Investment Fund may be used
to purchase Stock in the open market or otherwise, or used to pay on the Stock
Obligation, and shares so purchased will be allocated to a Participant’s Stock
Fund.


“Leased Employee”  The term “Leased Employee” means any person (other than an employee of
the Recipient) who, pursuant to an agreement between the Recipient and any
other Leasing Organization: (a) has performed services for the Recipient (or
for the Recipient and related persons determined in accordance with Section
414(n)(6) of the Code) on a substantially full-time basis for a period of at
least one year; and (b) has performed these services under the primary direction
and control of the Recipient.  For these
purposes, the terms “Recipient” and “Leasing Organization” shall have the
meanings set forth in Section 414(n) of the Code.


“Normal Retirement” means retirement on or after a Participant’s
65th birthday.


“Normal Retirement Date” means the date on which a Participant
attains age 65.


“Participant” means any Employee who is participating in
the Plan, or who has previously participated in the Plan and still has a
balance credited to his Account.


“Plan Year” means each period of 12 consecutive months
beginning on January 1 and ending on December 31.


“Recognized
Absence” means a
period for which —


(a)                  an
Employer grants an Employee a leave of absence for a limited period, but only
if an Employer grants such leave on a nondiscriminatory basis; or


(b)                  an
Employee is temporarily laid off by an Employer because of a change in business
conditions; or


(c)                  an
Employee is on active military duty, but only to the extent that his employment
rights are protected by the Military Selective Service Act of 1967 (38 U.S.C.
Sec. 2021).


“Reemployment
After a Period of Uniformed Service”


(a)                  “Reemployment
(or Reemployed) After a Period of Uniformed Service” means that an
Employee returned to employment with a Participating Employer, within the time
frame set forth in subparagraph (b) below, after a Period of Uniformed
Service in the Uniformed 



 6
 






 



Services and the following rules corresponding to
provisions of the Uniformed Services Employment and Reemployment Rights Act of
1994 (“USERRA”) apply:  (i) he
or she gives sufficient notice of leave to the Participating Employer prior to
commencing a Period of Uniformed Service, or is excused from providing such
notice; (ii) his or her employment with the Participating Employer prior
to a Period of Uniformed Service was not of a brief, nonrecurrent nature that
would preclude a reasonable expectation that such employment would continue
indefinitely or for a significant period; (iii) the Participating Employer’s
circumstances have not changed so that reemployment is unreasonable or an undue
hardship to the Participating Employer; and (iv) the applicable cumulative
Periods of Uniformed Service under USERRA equals five years or less, unless
service in the Uniformed Services:


(1)           in excess of five years is required
to complete an initial Period of Uniformed Service;


(2)           prevents the Participant from
obtaining orders releasing him or her from such Period of Uniformed Service
prior to the expiration of a five-year period (through no fault of the Participant);


(3)           is required in the National Guard for
drill and instruction, field exercises or active duty training, or to fulfill
necessary additional training, or to fulfill necessary additional training
requirements certified in writing by the Secretary of the branch of Uniformed
Services  concerned; or


(4)           for a Participant is


(A)          required other than for training under
any provisions of  law during a war or
national agency declared by the President or Congress;


(B)           required (other than for
training) in support of an operational mission for which personnel have
been ordered to active duty other than during war or national emergency;


(C)           required in support of a critical
mission or requirement of the Uniformed Services; or


(D)          the result of being called into service
as a member of the National Guard by the President in the case of rebellion or
danger of rebellion against the authority of the United States Government or if
the President is unable to execute the laws of the United States with the
regular forces.


(b)           The applicable statutory time frames
within which an Employee must report to a Participating Employer after a Period
of Uniformed Service are as follows:


(1)           If the Period of Uniformed Service
was less than 31 days,


(A)          not later than the beginning of the
first full regularly scheduled work period on the first full calendar day
following the completion of the Period of Uniformed Service and the expiration
of eight hours after a period of 



 7
 






 



time allowing for the
safe transportation of the Employee from the place of service in the Uniformed
Services to the Employee’s residence; or


(B)           as soon as possible after the
expiration of the eight-hour period of time referred to in Clause (A), if
reporting within  the period referred to
in such clause is impossible or unreasonable through no fault of the Employee.


(2)           In the case of an Employee whose
Period of Uniformed Service was for more than 30 days but less than 181 days,
by submitting an application for reemployment with a Participating Employer not
later than 14 days after the completion of the Period of Uniformed Service or,
if submitting such application within such period is impossible or unreasonable
through no fault of the Employee, the next first full calendar day when
submission of such application becomes reasonable.


(3)           In the case of an Employee whose
Period of Uniformed Service was for more than 180 days, by submitting an
application for reemployment with a Participating Employer not later than 90
days after the completion of the Period of Uniformed Service.


(4)           In the case of an Employee who is
hospitalized for, or convalescing from, an illness or injury related to the
Period of Uniformed Service the Employee shall apply for reemployment with a
Participating Employer at the end of the period that is necessary for the
Employee to recover.  Such period of
recovery shall not exceed two years, unless circumstances beyond the Employee’s
control make reporting as above unreasonable or impossible.


(c)           Notwithstanding
subparagraph (a), Reemployment After a Period of Uniformed Service terminates
upon the occurrence of any of the following:


(1)           a dishonorable or bad conduct
discharge from the Uniformed Services;


(2)           any other discharge from the
Uniformed Services under circumstances other than an honorable condition;


(3)           a discharge of a commissioned officer
from the Uniformed Services by court martial, by commutation of sentence by
court martial, or, in time of war, by the President; or


(4)           a demotion of a commissioned officer
in the Uniformed Services for absence without authorized leave of at least 3
months confinement under a sentence by court martial, or confinement in a
federal or state penitentiary after being found guilty of a crime under a final
sentence.


“Service” means an Employee’s period(s) of employment
or self-employment with an Employer, excluding for initial eligibility purposes
any period in which the individual was a nonresident alien and did not receive
from an Employer any earned income which constituted income from sources within
the United States.  An Employee’s Service
shall include up to four 



 8
 






 



(4) years of service with a predecessor employer
within the meaning of Section 414(a) of the Code.  An Employee’s Service shall also include any
service with an entity which is not an Employer, but only either (i) for a
period after 1975 in which the other entity is a member of a controlled group
of corporations or is under common control with other trades and businesses
within the meaning of Section 414(b) or 414(c) of the Code, and a member of the
controlled group or one of the trades and businesses is an Employer, (ii) for a
period after 1979 in which the other entity is a member of an affiliated
service group within the meaning of Section 414(m) of the Code, and a member of
the affiliated service group is an Employer, or (iii) all employers aggregated
with the Employer under Section 414(o) of the Code (but not until the Proposed
Regulations under Section 414(o) become effective).  Notwithstanding any provision of this Plan to
the contrary, credit for Service with respect to qualified military service
shall be provided in accordance with Section 414(u) of the Internal Revenue
Code.


“Spouse” means the individual, if any, to whom a
Participant is lawfully married on the date benefit payments to the Participant
are to begin, or on the date of the Participant’s death, if earlier.  A former spouse shall be treated as the
Spouse or surviving Spouse to the extent provided under a qualified domestic
relations order as described in section 414(p) of the Code.


“Stock” means shares of the Company’s voting common
stock or preferred stock meeting the requirements of Section 409(e)(3) of the
Code issued by an Employer which is a member of the same controlled group of
corporations within the meaning of Code Section 414(b).


“Stock Fund” means that portion of the Trust Fund
consisting of Stock.


“Stock Obligation” means an indebtedness arising from any
extension of credit to the Plan or the Trust which satisfies the requirements
set forth in Section 6.3 and which was obtained for any or all of the following
purposes:


(i)           to acquire
qualifying employer securities as defined in Treasury Regulations
§ 54.4975-12


(ii)          to repay such Stock Obligation; or


(iii)         to repay a prior
exempt loan.


“Trust” or “Trust Fund” means the trust fund created under this
Plan.


“Trust Agreement” means the agreement between the Bank and the
Trustee concerning the Trust Fund.  If
any assets of the Trust Fund are held in a co-mingled trust fund with assets of
other qualified retirement plans, “Trust Agreement” shall be deemed to include
the trust agreement governing that co-mingled trust fund.  With respect to the allocation of investment
responsibility for the assets of the Trust Fund, the provisions of Article II
of the Trust Agreement are incorporated herein by reference.



 9
 






 



 


“Trustee” means one or more corporate persons or
individuals selected from time to time by the Bank to serve as trustee or
co-trustees of the Trust Fund.


“Unallocated Stock Fund” means that portion of the Stock Fund
consisting of the Plan’s holding of Stock which have been acquired in exchange
for one or more Stock obligations and which have not yet been allocated to the
Participant’s Accounts in accordance with Section 4.5


“Uniformed Service” means the performance of duty on a voluntary
or involuntary basis in the uniformed service of the United States, including
the U.S. Public Health Services, under competent authority and includes active
duty, active duty for training, initial activity duty for training, inactive
duty training, full-time National Guard duty, and the period for which a person
is absent from a position of employment for purposes of an examination to
determine the fitness of the person to perform any such duty.


“Valuation Date” means, with respect to the Stock Fund, for
so long as there is a generally recognized market for the Company’s Stock, each
business day.  With respect to the assets
in the Investment Fund, the Valuation Date shall mean the last day of the Plan
Year and each other date as of which the Committee shall determine the
investment experience of the Investment Fund and adjust the Participants’
Accounts accordingly.  If, at any time,
there shall be no generally recognized market for the Company’s Stock, then the
Valuation Date for the Stock Fund and for the Investment Fund shall be the same
date.


“Valuation Period” means the period following a Valuation Date
and ending with the next Valuation Date.


“Vesting Year” means a unit of Service credited to a
Participant pursuant to Section 9 for purposes of determining his vested
interest in his Account.


Section 3.              Eligibility for Participation.


3.1  Initial Eligibility. 
An Employee shall enter the Plan as of the Entry Date coincident with or
next following the later of the following dates:


(a)                  the
last day of the Employee’s first Eligibility Year, and


(b)                  the
Employee’s 21st birthday.  However, if an
Employee is not in active Service with an Employer on the date he would
otherwise first enter the Plan, his entry shall be deferred until the next day
he is in Service.


3.2  Definition of Eligibility Year.  An “Eligibility Year” means an applicable
eligibility period (as defined below) in which the Employee has completed 1,000
Hours of Service for the Employer.  For
this purpose:


(a)                  an
Employee’s first “eligibility period” is the 12-consecutive month period
beginning on the first day on which he has an Hour of Service, and



 10














 


 


(b)                  his
subsequent eligibility periods will be 12-consecutive month periods beginning
on each January 1 after that first day of Service.


3.3  Terminated Employees.  No Employee shall have any interest or rights
under this Plan if he is never in active Service with an Employer on or after
the Effective Date.


3.4  Certain Employees Ineligible.  No Employee shall participate in the Plan
while his Service is covered by a collective bargaining agreement between an
Employer and the Employee’s collective bargaining representative if (i)
retirement benefits have been the subject of good faith bargaining between the
Employer and the representative and (ii) the collective bargaining agreement
does not provide for the Employee’s participation in the Plan.  No Leased Employee shall be a Participant in
the Plan.


3.5  Participation and Reparticipation.  Subject to the satisfaction of the foregoing
requirements, an Employee shall participate in the Plan during each period of
his Service from the date on which he first becomes eligible until his
termination.  For this purpose, an
Employee who returns before five (5) consecutive Breaks in Service who
previously satisfied the initial eligibility requirements or who returns after
5 consecutive one year Breaks in Service with a vested Account balance in the
Plan shall re-enter the Plan as of the date of his return to Service with an
Employer.


3.6  Omission of Eligible Employee.  If, in any Plan Year, any Employee who should
be included as a Participant in the Plan is erroneously omitted and discovery
of such omission is not made until after a contribution by his Employer for the
year has been made, the Employer shall make a subsequent contribution with
respect to the omitted Employee in the amount which the said Employer would
have contributed shall be made regardless of whether or not it is deductible in
whole or in part in any taxable year under applicable provisions of the Code.


3.7  Inclusion of Ineligible Employee.  If, in any Plan Year, any person who should
not have been included as a Participant in the Plan is erroneously included and
discovery of such incorrect inclusion is not made until after a contribution
for the year has been made, the Employer shall not be entitled to recover the
contribution made with respect to the ineligible person regardless of whether
or not a deduction is allowable with respect to the ineligible person shall
constitute a forfeiture for the Plan Year in which the discovery is made.


Section 4.              Contributions, Credits and Release of Shares.


4.1  Employer Discretionary Contributions.


4.1-1.       The Employer shall from time to time
contribute, with respect to a Plan Year, such amounts as it may determine from
time to time.  The Employer shall have no
obligation to contribute any amount under this Plan except as so determined in
its sole discretion.


4.1-2.       The Employer’s contributions, earnings on
contributions, and available forfeitures for a Plan Year shall be credited as
of the last day of the year to the Accounts of the 



 11
 






 



Active Participants in
proportion to their amounts of Cash Compensation earned while a Participant in
the Plan.  If in any Plan Year, as a
result of excluding from the allocation for such year Participants with less
than 1,000 Hours of Service or who are not employed on the last day of the Plan
Year as described in this paragraph (i.e., Participants who are not Active
Participants), the Plan would fail to qualify under Section 401(a)(3) of the
Code due to failure to comply with the “Ratio Percentage Test” described below,
then for such Plan Year a number of Participants as determined in the following
sentence shall be treated as Active Participants, to the extent necessary to
satisfy such Ratio Percentage Test, and the allocation of Employer
Contributions shall be recomputed accordingly. 
The number of such Participants who were not otherwise Active
Participants who shall be deemed to be Active Participants shall be the minimum
number of Participants as are necessary to permit the Plan to satisfy the Ratio
Percentage Test, and the specific Participants who shall be deemed to be Active
Participants under the terms of this paragraph shall be those Participants who
were employed by an Employer on the last day of the Plan Year and who completed
the greatest number of Hours of Service in the Plan Year.  If, after including all Participants
described in the preceding sentence as Active Participants, the Plan still
fails to satisfy the Ratio Percentage Test, then Participants who were employed
by an Employer on the last day of the Plan Year shall be included, in the order
of those who completed the greatest number of Hours of Service during the Plan
Year.  In the event more than one
employee has completed a specific number of Hours of Service, all such
employees shall be deemed Active Participants if any one of them would be so
eligible.  The plan shall be deemed to
comply with the Ratio Percentage Test if the percentage of non-Highly Paid
Employees benefiting under the Plan for a Plan Year is at least 70% of the percentage
of Highly Paid Employees benefiting under the Plan.  Employees who are nonresident aliens, who are
under age 21, or who do not have a Year of Service for eligibility purposes, or
who were not employed by an Employer on the last day of the Plan Year and who
had less than 500 Hours of Service during the Plan Year shall be excluded from
this computation.  For this purpose, an
employee shall be considered to benefit under the Plan for a Plan Year if he or
she receives an allocation of Employer contributions for that Plan Year.


4.1-3        Notwithstanding anything to the contrary herein, in the event
the allocation of the Employer’s contribution would cause more than one-third
of the shares of Stock released from the Unallocated Stock Account in a given
year to be allocated to the Accounts of Highly Paid Employee Participants, and
such allocation would cause any Highly Paid Employee Participant to exceed the
limitations under Code Section 415(c) or the Employer to exceed the deduction
limits under Code Section 404, then the Employer contribution shall not be
allocated to such Highly Paid Employee Participants in proportion to such
Highly Paid Employee Participant’s amount of Cash Compensation.  Rather, the Employer contribution shall be
allocated to the Accounts of Highly Paid Employee Participants in proportion to
their “Relative Cash Compensation.”  For
these purposes “Relative Cash Compensation” shall mean the Cash Compensation
for each Highly Paid Employee Participant which shall be taken into
consideration for purposes of receiving an allocation of the Employer
contribution.  The aggregate Relative
Cash Compensation shall be determined by the following formula: (N / 2) - $1 =
H, where “N” equals the aggregate amount of Cash Compensation attributable to
Non-highly Paid 



 12
 






 



Employees and “H” equals the
aggregate relative Cash Compensation attributable to Highly Paid Employee
Participants.  Once the Aggregate
Relative Cash Compensation for all Highly Paid Employee Participants is
determined, the Relative Cash Compensation attributable to each Highly Paid Employee
Participant is determined by multiplying the aggregate Relative Cash
Compensation by a fraction, the numerator of which is the Cash Compensation of
a Highly Paid Employee Participant and the denominator of which is the Cash
Compensation for all Highly Paid Employee Participants.


4.1-4.       Upon
a Participant’s Reemployment After a Period of Uniformed Service, the Employer
shall make an additional
contribution on behalf of such Participant that would have been made on his or
her behalf during the Plan Year or Years corresponding to the Participant’s
Period of Uniformed Service.


4.2  Contributions for Stock Obligations.  If the Trustee, upon instructions from the
Committee, incurs any Stock Obligation upon the purchase of Stock, the Employer
may contribute for each Plan Year an amount sufficient to cover all payments of
principal and interest as they come due under the terms of the Stock
Obligation.  If there is more than one
Stock Obligation, the Employer shall designate the one to which any
contribution is to be applied. 
Investment earnings realized on Employer contributions and any dividends
paid by the Employer on Stock held in the Unallocated Stock Account, shall be
applied to the Stock Obligation related to that Stock, subject to Section 7.2.


4.3  Conditions as to Contributions.  Employers’ contributions shall in all events
be subject to the limitations set forth in Section 5. Contributions may be made
in the form of cash, or securities and other property to the extent permissible
under ERISA, including Stock, and shall be held by the Trustee in accordance
with the Trust Agreement.  In addition to
the provisions of Section 13.3 for the return of an Employer’s contributions in
connection with a failure of the Plan to qualify initially under the Code, any
amount contributed by an Employer due to a good faith mistake of fact, or based
upon a good faith but erroneous determination of its deductibility under
Section 404 of the Code, shall be returned to the Employer within one year
after the date on which the contribution was originally made, or within one
year after its nondeductibility has been finally determined.  However, the amount to be returned shall be
reduced to take account of any adverse investment experience within the Trust
Fund in order that the balance credited to each Participant’s Account is not
less that it would have been if the contribution had never been made.


4.4  Transfer.  This Plan does not accept direct or indirect
transfers, including roll-over contributions from other tax-qualified plans.


4.5  Release of Shares.  In each Plan Year in which Employer
contributions, earnings on contributions, or cash dividends on Stock in the
Unallocated Stock Fund are used as payments under a Stock Obligation, a certain
number of shares of the Stock acquired with that Stock Obligation which is then
held in the Unallocated Stock Fund shall be released for allocation among
Active Participants in proportion to their amounts of Cash Compensation.  The number of shares released shall bear the
same ratio to the total number of those shares then held in the Unallocated
Stock Fund (prior to the release) as (i) the principal and interest payments
made on 



 13
 






 



the Stock Obligation in the current Plan Year bears to
(ii) the sum of (i) above, and the remaining principal and interest payments
required (or projected to be required on the basis of the interest rate in
effect at the end of the Plan Year) to satisfy the Stock Obligation.


At the direction of the Committee, the current and
projected payments of interest under a Stock Obligation may be ignored in
calculating the number of shares to be released in each year if (i) the Stock
Obligation provides for annual payments of principal and interest at a
cumulative rate that is not less rapid at any time than level annual payments
of such amounts for 10 years, (ii) the interest included in any payment is
ignored only to the extent that it would be determined to be interest under
standard loan amortization tables, and (iii) the term of the Stock Obligation,
by reason of renewal, extension, or refinancing, has not exceeded 10 years from
the original acquisition of the Stock.


Section 5.              Limitations on Contributions and Allocations.


5.1  Limitation on Annual Additions.  Notwithstanding anything herein to the
contrary, allocation of Employer contributions for any Plan Year shall be
subject to the following:


5.1-1        If allocation of Employer contributions in accordance with
Section 4.1 will result in an allocation of more than one-third the total
contributions for a Plan Year to the Accounts of Highly Paid Employees, and
such allocation would cause any Highly Paid Employee to exceed the limitations
under Code Section 415(c) or the Employer to exceed the deduction limits under
Code Section 404, then allocation of such amount shall be adjusted in the
manner set forth in Section 4.1 so that such excess will not occur.


5.1-2        After adjustment, if any, required by the preceding
paragraph, the annual additions during any Plan Year to any Participant’s
Account under this and any other defined contribution plans maintained by the
Employer or an affiliate (within the purview of Section 414(b), (c) and (m) and
Section 415(h) of the Code, which affiliate shall be deemed the Employer for
this purpose) shall not exceed the lesser of $30,000 (the “dollar limitation”)
or 25 percent (the “percentage limitation”) of the Participant’s 415
Compensation for such limitation year. 
For Plan Years commencing on or after January 1, 2002, the dollar
limitation shall be increased to $40,000 (or such other amount which results
from cost-of-living adjustments under Section 415(d) of the Code) and the
percentage limitation shall be increased to 100%; provided, however, that the
percentage limitation shall not apply to any contribution for medical benefits
after separation from service (within the meaning of Section 401(h) or Section
419(f)(2) of the Code) which is otherwise treated as an annual addition.  In the event that annual additions exceed the
aforesaid limitations, they shall be reduced in the following priority:


(i)            If the Participant
is covered by the Plan at the end of the Plan Year, any excess amount at the
end of the Plan Year that cannot be allocated to the Participant’s Account
shall be used to reduce the Employer contribution for such Participant in the
next limitation year and any succeeding limitation years if necessary.



 14
 






 



 


(ii)           If the Participant is not covered by
the Plan at the end of the Plan Year, the excess amount will be held
unallocated in a suspense account.  The
suspense account will be applied to reduce future Employer contributions for
all remaining Participants in the next limitation year and each succeeding
limitation year if necessary.


(iii)          If a suspense account is in existence
at any time during a limitation year, it will not participate in any allocation
of investment gains and losses.  All
amounts held in suspense accounts must be allocated to Participant’s Accounts
before any contributions may be made to the Plan for the limitation year.


(iv)          If a suspense account exists at the
time of Plan termination, amounts held in the suspense account that cannot be
allocated to Participants shall revert to the Employer.


5.1-3        For purposes of this Section 5.1, the “annual addition” to a
Participant’s accounts means the sum of (i) Employer contributions, (ii)
Employee contributions, if any, and (iii) forfeitures.  Annual additions to a defined contribution
plan also include: (i) amounts allocated, after March 31, 1984, to an
individual medical account, as defined in Section 415(l)(2) of the Internal
Revenue Code, which is part of a pension or annuity plan maintained by the
Employer and (ii) amounts derived from contributions paid or accrued after
December 31, 1985, in taxable years ending after such date, which are
attributable to post-retirement medical benefits allocated to the separate
account of a Key Employee under a welfare benefit fund, as defined in Section
419A(d) of the Internal Revenue Code, maintained by the Employer.  For these purposes, annual additions to a
defined contribution plan shall not include the allocation of the excess
amounts remaining in the Unallocated Stock Fund subsequent to a sale of stock
from such fund in accordance with a transaction described in Section 8.1 of the
Plan.  The dollar limitation referred to
in Section 5.1-2 shall, for each limitation year ending after 1988, be
automatically adjusted to the new dollar limitations determined by the
Commissioner of Internal Revenue for the calendar year beginning in that
limitation year.


5.1-4        Notwithstanding the foregoing, if no more than one-third of
the Employer contributions to the Plan for a year which are deductible under
Section 404(a)(9) of the Code are allocated to Highly Paid Employees (within
the meaning of Section 414(q) of the Internal Revenue Code), the limitations
imposed herein shall not apply to:


(i)            forfeitures of Employer securities (within the meaning of
Section 409 of the Code) under the Plan if such securities were acquired with
the proceeds of a loan described in Section 404(a)(9)(A) of the Code), or


(ii)           Employer contributions to the Plan which are deductible
under Section 404(a)(9)(B) and charged against a Participant’s Account.


5.1-5        If the Employer contributes amounts, on behalf of Employees
covered by this Plan, to other “defined contribution plans” as defined in
Section 3(34) of ERISA, the limitation on annual additions provided in this
Section shall be applied to annual 



 15
 






 



additions in the aggregate
to this Plan and to such other plans. 
Reduction of annual additions, where required, shall be accomplished first
by reductions under such other plan pursuant to the directions of the named
fiduciary for administration of such other plans or under priorities, if any,
established under the terms of such other plans and then by allocating any
remaining excess for this Plan in the manner and priority set out above with
respect to this Plan.


5.1-6        A limitation year shall mean each 12 consecutive month period
beginning each January 1.


5.2  Effect of Limitations.  The Committee shall take whatever action may
be necessary from time to time to assure compliance with the limitations set
forth in Section 5.1. Specifically, the Committee shall see that each Employer
restrict its contributions for any Plan Year to an amount which, taking into
account the amount of available forfeitures, may be completely allocated to the
Participants consistent with those limitations. 
Where the limitations would otherwise be exceeded by any Participant,
further allocations to the Participant shall be curtailed to the extent
necessary to satisfy the limitations. 
Where an excessive amount is contributed on account of a mistake as to
one or more Participants’ compensation, or there is an amount of forfeitures
which may not be credited in the Plan Year in which it becomes available, the
amount shall be corrected in accordance with Section 5.1-2 of the Plan.


5.3  Limitations as to Certain Participants.  Aside from the limitations set forth in
Section 5.1, if the Plan acquires any Stock in a transaction as to which a
selling shareholder or the estate of a deceased shareholder is claiming the
benefit of Section 1042 of the Code, the Committee shall see that none of such
Stock, and no other assets in lieu of such Stock, are allocated to the Accounts
of certain Participants in order to comply with Section 409(n) of the Code.


This restriction shall apply at all times to a
Participant who owns (taking into account the attribution rules under Section
318(a) of the Code, without regard to the exception for employee plan trusts in
Section 318(a)(2)(B)(i) more than 25 percent of any class of stock of a
corporation which issued the Stock acquired by the Plan, or another corporation
within the same controlled group, as defined in Section 409(l)(4) of the Code
(any such class of stock hereafter called a “Related Class”).  For this purpose, a Participant who owns more
than 25 percent of any Related Class at any time within the one year preceding
the Plan’s purchase of the Stock shall be subject to the restriction as to all
allocations of the Stock, but any other Participant shall be subject to the
restriction only as to allocations which occur at a time when he owns more than
25 percent of any Related Class.


Further, this restriction shall apply to the selling
shareholder claiming the benefit of Section 1042 and any other Participant who
is related to such a shareholder within the meaning of Section 267(b) of the
Code, during the period beginning on the date of sale and ending on the later
of (1) the date that is ten years after the date of sale, or (2) the date of
the Plan allocation attributable to the final payment of acquisition
indebtedness incurred in connection with the sale.



 16
 






 



 


This restriction shall not apply to any Participant
who is a lineal descendant of a selling shareholder if the aggregate amounts
allocated under the Plan for the benefit of all such descendants do not exceed
five percent of the Stock acquired from the shareholder.


5.4           Allocations Upon a Change in Control.  Upon a Change in Control described in Section
9.3-2, the Plan shall be terminated and the Committee shall direct the Trustee
to use the proceeds from the sale of Stock pursuant to the Change in Control to
repay the Stock Obligation.  After
repayment of the Stock Obligation from Employer contribution, earnings on
contributions and dividends for the Plan Year and allocation of shares released
based on such payments, all remaining shares in the Unallocated Stock Fund (or
the proceeds thereof, if applicable) shall be deemed to be earnings and shall
be allocated to the Accounts of Active Participants, in accordance with Section
8.1 hereof.


5.5           Dividend Recharacterization.  If any dividend paid on Stock shall be
recharacterized to be an Employer contribution to the Plan for any limitation
year, and if this recharacterization would cause an allocation to the
Participant’s Accounts to exceed the limits allowed under Section 415 of the
Code for the limitation year, then the Participant’s Accounts shall be
retroactively reduced by an amount equal to the sum of (i) the excess of the
amount credited to the Participant’s Accounts over the maximum amount that was
properly allocable to his or her Accounts (the “excess amount”) plus
(ii) all earnings of the Trust Fund credited to the Participant’s Accounts that
are attributable to the excess amount. 
This provision shall be administered in such a way as to assure that no
Participant receives any benefit from an allocation of any excess amount to his
or her Accounts.  Any excess amount and
any earnings attributable to the excess amount shall be placed in the suspense
account referred to in Section 5.1.  It
shall be conclusively presumed that any error with respect to the
characterization of any dividend payment by the Company was a mistake of fact
with respect to which the Trustee or the Administrator shall be entitled to
make corrective adjustments to Participant Accounts.


Section 6.              Trust Fund and Its Investment.


6.1  Creation of Trust Fund.  All amounts received under the Plan from
Employers and investments shall be held as the Trust Fund pursuant to the terms
of this Plan and of the Trust Agreement between the Bank and the Trustee.  The benefits described in this Plan shall be
payable only from the assets of the Trust Fund, and none of the Bank, any other
Employer, its board of directors or trustees, its stockholders, its officers,
its employees, the Committee, and the Trustee shall be liable for payment of
any benefit under this Plan except from the Trust Fund.


6.2  Stock Fund and Investment Fund.  The Trust Fund held by the Trustee shall be
divided into the Stock Fund, consisting entirely of Stock, and the Investment
Fund, consisting of all assets of the Trust other than Stock.  The Trustee shall have no investment
responsibility for the Stock Fund, but shall accept any Employer contributions
made in the form of Stock, and shall acquire, sell, exchange, distribute, and
otherwise deal with and dispose of Stock in accordance with the instructions of
the Committee.  The Trustee shall have
full responsibility for the investment of the Investment Fund, except to the
extent such responsibility may be delegated from time to time to one or more
investment managers pursuant to Section 2.3 of the Trust 



 17
 






 



Agreement, or to the extent the Committee directs the
Trustee to purchase Stock with the assets in the Investment Fund.


6.3  Acquisition of Stock.  From time to time the Committee may, in its
sole discretion, direct the Trustee to acquire Stock from the issuing Employer
or from shareholders, including shareholders who are or have been Employees,
Participants, or fiduciaries with respect to the Plan.  The Trustee shall pay for such Stock no more
than its fair market value, which shall be determined conclusively by the
Committee pursuant to Section 12.4. The Committee may direct the Trustee to
finance the acquisition of Stock by incurring or assuming indebtedness to the
seller or another party which indebtedness shall be called a “Stock Obligation”. 
The term “Stock Obligation” shall refer to a loan made to the Plan by a
disqualified person within the meaning of Section 4975(e)(2) of the Code, or a
loan to the Plan which is guaranteed by a disqualified person.  A Stock Obligation includes a direct loan of
cash, a purchase-money transaction, and an assumption of an obligation of a
tax-qualified employee stock ownership plan under Section 4975(e)(7) of the
Code (“ESOP”).  For these purposes, the
term “guarantee” shall include an unsecured guarantee and the use of assets of
a disqualified person as collateral for a loan, even though the use of assets
may not be a guarantee under applicable state law.  An amendment of a Stock Obligation in order
to qualify as an “exempt loan” is not a refinancing of the Stock Obligation or
the making of another Stock Obligation. 
The term “exempt loan” refers to a loan that satisfies the provisions of
this paragraph.  A “non-exempt loan”
fails to satisfy this paragraph. Any Stock Obligation shall be subject to the
following conditions and limitations:


6.3-1        A Stock Obligation shall be for a specific term, shall not be
payable on demand except in the event of default, and shall bear a reasonable
rate of interest.


6.3-2        A Stock Obligation may, but need not, be secured by a
collateral pledge of either the Stock acquired in exchange for the Stock
Obligation, or the Stock previously pledged in connection with a prior Stock
Obligation which is being repaid with the proceeds of the current Stock
Obligation.  No other assets of the Plan
and Trust may be used as collateral for a Stock Obligation, and no creditor
under a Stock Obligation shall have any right or recourse to any Plan and Trust
assets other than Stock remaining subject to a collateral pledge.


6.3-3        Any pledge of Stock to secure a Stock Obligation must provide
for the release of pledged Stock in connection with payments on the Stock
obligations in the ratio prescribed in Section 4.5.


6.3-4        Repayments of principal and interest on any Stock Obligation
shall be made by the Trustee only from Employer cash contributions designated
for such payments, from earnings on such contributions, and from cash dividends
received on Stock, in the last case, however, subject to the further
requirements of Section 7.2.


6.3-5        In the event of default of a Stock Obligation, the value of
Plan assets transferred in satisfaction of the Stock Obligation must not exceed
the amount of the default.  If the lender
is a disqualified person within the meaning of Section 4975 of the Code, a
Stock Obligation must provide for a transfer of Plan assets upon default only
upon and to the 



 18
 






 



extent of the failure of the
Plan to meet the payment schedule of said Stock Obligation.  For purposes of this paragraph, the making of
a guarantee does not make a person a lender.”


6.4  Participants’ Option to Diversify.  The Committee shall provide for a procedure
under which each Participant may, during the qualified election period, elect
to “diversify” a portion of the Employer Stock allocated to his Account, as
provided in Section 401(a)(28)(B) of the Code. 
An election to diversity must be made on the prescribed form and filed
with the Committee within the period specified herein.  For each of the first five (5) Plan years in
the qualified election period, the Participant may elect to diversify an amount
which does not exceed 25% of the number of shares allocated to his Account
since the inception of the Plan, less all shares with respect to which an
election under this Section has already been made.  For the last year of the qualified election
period, the Participant may elect to have up to 50 percent of the value of his
Account committed to other investments, less all shares with respect to which
an election under this Section has already been made.  The term “qualified election period” shall
mean the six (6) Plan Year period beginning with the first Plan Year in which a
Participant has both attained age 55 and completed 10 years of participation in
the Plan.  A Participant’s election to
diversify his Account may be made within each year of the qualified election
period and shall continue for the 90-day period immediately following the last
day of each year in the qualified election period.  Once a Participant makes such election, the
Plan must complete diversification in accordance with such election within 90
days after the end of the period during which the election could be made for
the Plan Year.  In the discretion of the
Committee, the Plan may satisfy the diversification requirement by any of the
following methods:


6.4-1        The Plan may distribute all or part of the amount subject to
the diversification election.


6.4-2        The Plan may offer the Participant at least three other
distinct investment options, if available under the Plan.  The other investment options shall satisfy
the requirements of Regulations under Section 404(c) of the Employee Retirement
Income Security Act of 1974, as amended (“ERISA”).


6.4-3        The Plan may transfer
the portion of the Participant’s Account subject to the diversification
election to another qualified defined contribution plan of the Employer that
offers at least three investment options satisfying the requirements of the
Regulations under Section 404(c) of ERISA.


Section 7.              Voting Rights and Dividends on Stock.


7.1  Voting and Tendering of Stock.


7.1-1        The Trustee generally
shall vote all shares of Stock held under the Plan in accordance with the
written instructions of the Committee.  However, if any Employer has
registration-type class of securities within the meaning of Section 409(e)(4)
of the Code, or if a matter submitted to the holders of the Stock involves a
merger, consolidation, recapitalization, reclassification, liquidation,
dissolution, or sale of 



 19
 






 



substantially all assets of an entity, then (i) the shares of Stock
which have been allocated to Participants’ Accounts shall be voted by the
Trustee in accordance with the Participants’ written instructions, and (ii) the
Trustee shall vote any unallocated Stock and allocated Stock for which it has
received no voting instructions in the same proportions as it votes the
allocated Stock for which it has received instructions from Participants;
provided, however, that if an exempt loan, as defined in Section 4975(d) of the
Code, is outstanding and the Plan is in default on such exempt loan, as default
is defined in the loan documents, then to the extent that such loan documents
require the lender to exercise voting rights with respect to the unallocated
shares, the loan documents will prevail. 
In the event no shares of Stock have been allocated to Participants’
Accounts at the time Stock is to be voted and any exempt loan which may be
outstanding is not in default, each Participant shall be deemed to have one
share of Stock allocated to his or her Account for the sole purpose of
providing the Trustee with voting instructions.


Notwithstanding any
provision hereunder to the contrary, all unallocated shares of Stock must be
voted by the Trustee in a manner determined by the Trustee to be for the
exclusive benefit of the Participants and Beneficiaries.  Whenever such voting rights are to be
exercised, the Employers shall provide the Trustee, in a timely manner, with
the same notices and other materials as are provided to other holders of the
Stock, which the Trustee shall distribute to the Participants.  The Participants shall be provided with
adequate opportunity to deliver their instructions to the Trustee regarding the
voting of Stock allocated to their Accounts. 
The instructions of the Participants’ with respect to the voting of
allocated shares hereunder shall be confidential.


7.1-2        In the event of a
tender offer, Stock shall be tendered by the Trustee in the same manner as set
forth above with respect to the voting of Stock.  Notwithstanding any provision hereunder to
the contrary, Stock must be tendered by the Trustee in a manner determined by
the Trustee to be for the exclusive benefit of the Participants and
Beneficiaries.


7.2           Dividends on Stock.  Dividends on Stock which are received by the
Trustee in the form of additional Stock shall be retained in the Stock Fund,
and shall be allocated among the Participant’s Accounts and the Unallocated
Stock Fund in accordance with their holdings of the Stock on which the
dividends have been paid.  Dividends on
Stock credited to Participants’ Accounts which are received by the Trustee in
the form of cash shall, at the direction of the Employer paying the dividends,
either (i) be credited to the  Accounts
in accordance with Section 8.3 and invested as part of the Investment Fund,
(ii) be distributed immediately to the Participants in proportion with the
Participants’ Stock Fund Account balance (iii) be distributed to the
Participants within 90 days of the close of the Plan Year in which paid in
proportion with the Participants’ Stock Fund Account balance or (iv) be used to
make payments on the Stock Obligation. 
If dividends on Stock allocated to a Participant’s Account are used to
repay the Stock Obligation, Stock with a fair market value equal to the
dividends so used must be allocated to such Participant’s Account in lieu of
the dividends.  Dividends on Stock held
in the Unallocated Stock Fund which are received by the Trustee in the form of
cash shall be allocated to Participants’ Investment Fund Accounts (pro rata
based on the Participant’s Account balance in relation to all Participants’
Account balances) and shall be applied as soon as practicable to payments of
principal and interest under the Stock Obligation incurred with the purchase of
the Stock.


 



 20














 


 


Section 8.              Adjustments to Accounts.


8.1  Adjustments for Transactions.  An Employer contribution pursuant to Section
4.1 shall be credited to the Participants’ Accounts as of the last day of the
Plan Year for which it is contributed, in accordance with Section 4.1.  Stock released from the Unallocated Stock
Fund upon the Trust’s repayment of a Stock Obligation pursuant to Section 4.2
shall be credited to the Active Participants’ Accounts as of the last day of
the Plan Year in which the repayment occurred, pro rata on the basis of Cash
Compensation.  Any excess amounts
remaining in the Unallocated Stock Fund after a sale of Stock from the
Unallocated Stock Fund to repay a Stock Obligation shall be allocated as
earnings of the Plan as of the last day of the Plan Year in which the repayment
occurred among the Active Participants’ Accounts in proportion to the amounts
of their Stock Fund Account balance, determined immediately prior to the Change
in Control.  Any benefit that is paid to
a Participant or Beneficiary pursuant to Section 10 shall be charged to the
Participant’s Account as of the first day of the Valuation Period in which it
is paid.  Any forfeiture or restoral
shall be charged or credited to the Participant’s Account as of the first day
of the Valuation Period in which the forfeiture or restoral occurs pursuant to
Sections 9.5 and 9.6.


8.2  Valuation of Investment Fund.  As of the last day of each Valuation Period,
the Trustee shall prepare a balance sheet of the Investment Fund, recording
each asset (including any contribution receivable from an Employer) and
liability at its fair market value.  Any
liability with respect to short positions or options and any item of accrued
income or expense and unrealized appreciation or depreciation shall be included;
provided, however, that such an item may be estimated or excluded if it is not
readily ascertainable unless estimating or excluding it would result in a
material distortion.  The Committee shall
then determine the net gain or loss of the Investment Fund since the last day
of the immediately preceding Valuation Period, which shall mean the entire
income of the Investment Fund, including realized and unrealized capital gains
and losses, net of any expenses to be charged to the general Investment Fund
and excluding any contributions by the Employer.  The determination of gain or loss shall be
consistent with the balance sheets of the Investment Fund for the current and
preceding Valuation Periods.


8.3  Adjustments for Investment Experience.  Except as otherwise set forth herein, any net
gain or loss of the Investment Fund during a Valuation Period, as determined
pursuant to Section 8.2, shall be allocated as of the last day of the Valuation
Period among the Participants’ Accounts in proportion to the opening balance in
each Account, as adjusted for benefit payments and forfeitures during the
Valuation Period, without regard to whatever Stock may be credited to an
Account. Any cash dividends received on Stock credited to Participant’s Stock
Fund Accounts shall be allocated as of the last day of the Valuation Period
among the Participants’ Stock Fund Accounts based on the opening balance in
each Participant’s Stock Fund Account.



 21
 






 



 


Section 9.              Vesting of Participants’ Interests.


9.1  Deferred Vesting in Accounts.  A Participant’s vested interest in his
Account shall be based on his Vesting Years in accordance with the following
Table, subject to the balance of this Section 9:


	
  Vesting

  Years

  	
   

  	
  Percentage of

  Interest Vested

  
	
  Fewer than 3

  	
   

  	
  0%

  
	
  3

  	
   

  	
  20%

  
	
  4

  	
   

  	
  40%

  
	
  5

  	
   

  	
  60%

  
	
  6

  	
   

  	
  80%

  
	
  7

  	
   

  	
  100%

  



 


9.2  Computation of Vesting Years.  For purposes of this Plan, a “Vesting Year”
means generally a Plan Year in which an Employee has at least 1,000 Hours of
Service, beginning with the first Plan Year in which the Employee has completed
an Hour of Service with the Employer, and including Service with other
employers as provided in the definition of “Service”.  Notwithstanding the above, an Employee who
was employed by the Bank in mutual form, shall receive credit for vesting
purposes for each continuous period of employment with the mutual Bank, from
each November 1 through October 31, in which such Employee completed 1,000
Hours of Service, not to exceed 3 years of credit for vesting purpose (such
years shall also be referred to as “Vesting Years”).  However, a Participant’s Vesting Years shall
be computed subject to the following conditions and qualifications:


9.2-1        A Participant’s Vesting Years shall not include any Service
prior to the date on which an Employee attains age 18.


9.2-2        A Participant’s vested interest in his Account accumulated
before five (5) consecutive Breaks in Service shall be determined without
regard to any Service after such five consecutive Breaks in Service.  Further, if a Participant has five (5)
consecutive Breaks in Service before his interest in his Account has become
vested to some extent, pre-Break years of Service shall not be required to be
taken into account for purposes of determining his post-Break vested
percentage.


9.2-3        In the case of a Participant who has 5 or more consecutive
1-year Breaks in Service, the Participant’s pre-break Service will count in
vesting of the Employer-derived post-break accrued benefit only if either:


(i)           such Participant has any
nonforfeitable interest in the accrued benefit attributable to Employer
contributions at the time of separation from Service, or


(ii)          upon returning to Service the number
of consecutive 1-year Breaks in Service is less than the number of years of
Service.



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9.2-4        Unless otherwise specifically excluded, a Participant’s
Vesting Years shall include any period of active military duty to the extent
required by the Military Selective Service Act of 1967 (38 U.S.C. Section
2021).


9.2-5        If any amendment changes the vesting
schedule, including an automatic change to or from a top-heavy vesting
schedule, any Participant with three (3) or more Vesting Years may, by filing a
written request with the Employer, elect to have his vested percentage computed
under the vesting schedule in effect prior to the amendment.  The election period must begin not later than
the later of sixty (60) days after the amendment is adopted, the amendment
becomes effective, or the Participant is issued written notice of the amendment
by the Employer or the Committee.


9.3  Full Vesting Upon Certain Events.


9.3-1      Notwithstanding
Section 9.1, a Participant’s interest in his Account shall fully vest on the
Participant’s Normal Retirement Date. 
The Participant’s interest shall also fully vest in the event that his
Service is terminated by Early Retirement, Disability or by death.


9.3-2      The
Participant’s interest in his Account shall also fully vest in the event of a “Change
in Control” of the Bank, or the Company. 
For these purposes, “Change in Control” shall mean an event of a nature
that; (i) would be required to be reported in response to Item 5.01 of the
current report on Form 8-K, as in effect on the date hereof, pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934 (the “Exchange Act”);
or (ii) results in a Change in Control of the Bank or the Company within the
meaning of the Bank Holding Company Act of 1956, as amended, and applicable
rules and regulations promulgated thereunder as in effect at the time of the
Change in Control (collectively, the “BHCA”); or (iii) without limitation such
a Change in Control shall be deemed to have occurred at such time as (a) any “Person”
(as the term is used in Sections 13(d) and 14(d) of the Exchange Act) is or
becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of the Bank or the Company
representing 25% or more of the Bank’s or the Company’s outstanding securities
except for any securities of the Bank purchased by the Company in connection
with the conversion of the Bank to the stock form and any securities purchased
by the Bank’s employee stock ownership plan and trust; or (b) individuals who
constitute the Board on the date hereof (the “Incumbent Board”) cease for any
reason to constitute at least a majority thereof, provided, however, that this sub-section (b) shall not apply
if the Incumbent Board is replaced by the appointment by a Federal banking
agency of a conservator or receiver for the Bank and, provided further that any person becoming
a director subsequent to the date hereof whose election was approved by a vote
of at least two-thirds of the directors comprising the Incumbent Board or whose
nomination for election by the Company’s stockholders was approved by the same
Nominating Committee serving under an Incumbent Board, shall be, for purposes
of this clause (b), considered as though he were a member of the Incumbent
Board; or (c) a plan of reorganization, merger, consolidation, sale of all or
substantially all the assets of the Bank or the Company; or (d) a proxy statement
soliciting proxies from stockholders of the Company, by someone other than the
current management of the Company, seeking stockholder approval of a plan of
reorganization, merger or consolidation of the Company or Bank or similar
transaction 



 23
 






 



with one or more corporations as a result of which the
outstanding shares of the class of securities then subject to such plan or
transaction are exchanged for or converted into cash or property or securities
not issued by the Bank or the Company shall be distributed and the requisite
number of proxies approving such plan of reorganization, merger or
consolidation of the Company or Bank are received and voted in favor of such
transactions; or (e) a tender offer is made for 25% or more of the outstanding
securities of the Bank or Company and shareholders owning beneficially or of
record 25% or more of the outstanding securities of the Bank or Company have
tendered or offered to sell their shares pursuant to such tender offer and such
tendered shares have been accepted by the tender offeror.


9.4  Full Vesting Upon Plan Termination.  Notwithstanding Section 9.1, a Participant’s
interest in his Account shall fully vest upon termination of this Plan or upon
the permanent and complete discontinuance of contributions by his
Employer.  In the event of a partial
termination, the interest of each affected Participant shall fully vest with
respect to that part of the Plan which is terminated.


9.5  Forfeiture, Repayment, and Restoral.  If a Participant’s Service terminates before
his interest in his Account is fully vested, that portion which has not vested
shall be forfeited if he either (i) receives a distribution of his entire
vested interest pursuant to Section 10.1, or (ii) incurs five (5) consecutive
one year Breaks In Service.  If a
Participant’s Service terminates prior to having any portion of his Account
become vested, such Participant shall be deemed to have received a distribution
of his vested interest as of the Valuation Date next following his termination
of Service.


If a Participant who has received his entire vested
interest returns to Service before he has five (5) consecutive Breaks in
Service, he may repay to the Trustee an amount equal to the distribution.  The Participant may repay such amount at any
time within five years after he has returned to Service.  The amount shall be credited to his Account
at the time it is repaid; an additional amount equal to that portion of his
Account which was previously forfeited shall be restored to his Account at the
same time from other Employees’ forfeitures and, if such forfeitures are
insufficient, from a special contribution by his Employer for that year.  A Participant who was deemed to have received
a distribution of his vested interest in the Plan shall have his Account
restored as of the first day on which he performs an Hour of Service after his
return.


9.6  Accounting for Forfeitures.  If a portion of a Participant’s Account is
forfeited, Stock allocated to said Participant’s Account shall be forfeited
only after other assets are forfeited. 
If interests in more than one class of Stock have been allocated to a
Participant’s account, the Participant must be treated as forfeiting the same
proportion of each class of Stock.  A
forfeiture shall be charged to the Participant’s Account as of the first day of
the first Valuation Period in which the forfeiture becomes certain pursuant to
Section 9.5. Except as otherwise provided in that Section, a forfeiture shall
be added to the contributions of the terminated Participant’s Employer which
are to be credited to other Participants pursuant to Section 4.1 as of the last
day of the Plan Year in which the forfeiture becomes certain.



 24
 






 



 


9.7  Vesting and Nonforfeitability.  A Participant’s interest in his Account which
has become vested shall be nonforfeitable for any reason.


Section 10.            Payment of Benefits.


10.1                Benefits for Participants.  For a Participant whose Service ends for any
reason, distribution will be made to or for the benefit of the Participant or,
in the case of the Participant’s death, his Beneficiary, by payment in a lump
sum, in accordance with Section 10.2.


If the value of a Participant’s vested Account
balance is, or has ever been in excess of, $5,000, then his benefits shall not
be paid before his 65th birthday unless he elects an early payment date in a
written election filed with the Committee. 
A Participant may modify such an election at any time, provided any new
benefit payment date is at least 30 days after a modified election is delivered
to the Committee, subject to the provisions of Section 10.11 hereof.  All distributions under this section shall be
determined and made in accordance with the regulations under Code Section
401(a)(9), including Section 1.401(a)(9)-2. 
The provisions reflecting Section 401(a)(9) override any distribution
options in the Plan inconsistent with Section 401(a)(9).


Notwithstanding
the foregoing, effective as of March 28, 2005, if the value of a Participant’s vested
Account balance at the time of termination of employment does not exceed $1,000
and the Participant fails to consent to a distribution, the Participant’s
vested Account may be distributed in a lump sum, in cash or a
combination of cash and stock, in the sole discretion of the Plan
Administrator, within 60 days after the
end of the Plan Year in which employment terminates.  If the value of a Participant’s vested
Account balance exceeds $1,000, then his benefits shall not be paid prior to
the earlier of age 65 or his Normal Retirement Date, unless he consents to an
earlier payment date in a written election filed with the Committee.  A Participant may modify such an election at
any time, provided any new benefit payment date is at least 30 days after a
modified election is delivered to the Committee.  Failure of a Participant to consent to a
distribution prior to the earlier of age 65 or his Normal Retirement Date shall
be deemed to be an election to defer commencement of payment of any benefit
under this section.


10.2                Time for Distribution.


10.2.1    If
the Participant and, if applicable, with the consent of the Participant’s
spouse, elects the distribution of the Participant’s Account balance in the
Plan, distribution shall commence as soon as practicable after the last day of
the Plan Year following the Participant’s termination of Service for any
reason, but no later than one year after the close of the Plan Year:


(i)            in which the Participant separates from Service by reason
of Normal Retirement, Disability, or death; or


(ii)           which is the fifth Plan Year following the year in which
the Participant resigns or is dismissed, unless he is reemployed before such
date.



 25
 






 



 


10.2.2    Unless
the Participant elects otherwise, the distribution of the balance of a
Participant’s Account shall commence not later than the 60th day after the
latest of the close of the Plan Year in which -


(i)           the Participant attains the age of
65;


(ii)          occurs the tenth
anniversary of the year in which the Participant commenced participation in the
Plan; or


(iii)         the Participant
terminates his Service with the Employer.


10.2.3      Notwithstanding
anything to the contrary, (1) with respect to a 5-percent owner (as defined in
Code Section 416), distribution of a Participant’s Account shall commence
(whether or not he remains in the employ of the Employer) not later than the April
1 of the calendar year next following the calendar year in which the
Participant attains age 701⁄2, and (2) with respect to all other Participants,
payment of a Participant’s benefit will commence not later than April 1 of the
calendar year following the calendar year in which the Participant attains age
701⁄2, or, if later, the year in which the Participant retires.  Any Participant (other than a 5-percent
owner) attaining age 701⁄2 may elect by April 1 of the calendar year following
the year in which the Participant attained age 701⁄2 to defer distributions until
the calendar year following the calendar year in which the Participant
retires.  If no such election is made,
the Participant will begin receiving distributions by the April 1 of the calendar
year following the year in which the Participant attained age 701⁄2.


A Participant’s benefit from
that portion of his Account committed to the Investment Fund shall be
calculated on the basis of the most recent Valuation Date before the date of
payment.


10.2.4    Distribution of a Participant’s Account
balance after his death shall comply with the following requirements:


(i)           If a Participant dies before his
distributions have commenced, distribution of his Account to his Beneficiary
shall commence not later than one year after the end of the Plan Year in which
the Participant died, however, if the Participant’s Beneficiary is his
surviving Spouse, distributions may commence on the date on which the
Participant would have attained age 701⁄2. 
In either case, distributions shall be completed within five years after
they commence.


(ii)          If a married Participant dies before
his benefit payments begin, then unless he has specifically elected otherwise
the Committee shall cause the balance in his Account to be paid to his
Spouse.  No election by a married
Participant of a different Beneficiary shall be valid unless the election is
accompanied by the Spouse’s written consent, which (i) must acknowledge the
effect of the election, (ii) must explicitly provide either that the designated
Beneficiary may not subsequently be changed by the Participant without the
Spouse’s further consent, or that it may be changed without such consent, and
(iii)



 26
 






 



must be witnessed by the
Committee, its representative, or a notary public. (This requirement shall not
apply if the Participant establishes to the Committee’s satisfaction that the
Spouse may not be located.)


10.3                Marital Status.  The Committee shall from time to time take
whatever steps it deems appropriate to keep informed of each Participant’s
marital status.  Each Employer shall
provide the Committee with the most reliable information in the Employer’s
possession regarding its Participants’ marital status, and the Committee may,
in its discretion, require a notarized affidavit from any Participant as to his
marital status.  The Committee, the Plan,
the Trustee, and the Employers shall be fully protected and discharged from any
liability to the extent of any benefit payments made as a result of the
Committee’s good faith and reasonable reliance upon information obtained from a
Participant and his Employer as to his marital status.


10.4                Delay in Benefit Determination.  If the Committee is unable to determine the
benefits payable to a Participant or Beneficiary on or before the latest date
prescribed for payment pursuant to Section 10.1 or 10.2, the benefits shall in
any event be paid within 60 days after they can first be determined, with
whatever makeup payments may be appropriate in view of the delay.


10.5                Accounting for Benefit Payments.  Any benefit payment shall be charged to the
Participant’s Account as of the first day of the Valuation Period in which the
payment is made.


10.6                Options to Receive and Sell Stock.  Unless ownership of virtually all Stock is
restricted to active Employees and qualified retirement plans for the benefit
of Employees pursuant to the certificates of incorporation or by-laws of the
Employers issuing Stock, a terminated Participant or the Beneficiary of a
deceased Participant may instruct the Committee to distribute the Participant’s
entire vested interest in his Account in the form of Stock.  In that event, the Committee shall apply the
Participant’s vested interest in the Investment Fund to purchase sufficient
Stock from the Stock Fund or from any owner of Stock to make the required
distribution.  In all other cases, the
Participant’s vested interest in the Stock Fund shall be distributed in shares
of Stock, and his vested interest in the Investment Fund shall be distributed
in cash.


Any Participant who receives Stock pursuant to
Section 10.1, and any person who has received Stock from the Plan or from such
a Participant by reason of the Participant’s death or incompetency, by reason
of divorce or separation from the Participant, or by reason of a rollover contribution
described in Section 402(a)(5) of the Code, shall have the right to require the
Employer which issued the Stock to purchase the Stock for its current fair
market value (hereinafter referred to as the “put right”).  The put right shall be exercisable by written
notice to the Committee during the first 60 days after the Stock is distributed
by the Plan, and, if not exercised in that period, during the first 60 days in
the following Plan Year after the Committee has communicated to the Participant
its determination as to the Stock’s current fair market value.  However, the put right shall not apply to the
extent that the Stock, at the time the put right would otherwise be
exercisable, may be sold on an established market in accordance with federal and
state securities laws and regulations. 
Similarly, the put option shall not apply with respect to the portion of
a Participant’s Account which the Employee elected to have reinvested under
Code 



 27
 






 



Section 401(a)(28)(B). 
If the put right is exercised, the Trustee may, if so directed by the
Committee in its sole discretion, assume the Employer’s rights and obligations
with respect to purchasing the Stock. 
Notwithstanding anything herein to the contrary, in the case of a plan
established by a Bank (as defined in Code Section 581), the put option shall
not apply if prohibited by a federal or state law and Participants are entitled
to elect their benefits be distributed in cash.


The Employer or the Trustee, as the case may be, may
elect to pay for the Stock in equal periodic installments, not less frequently
than annually, over a period not longer than five years from the day after the
put right is exercised, with adequate security and interest at a reasonable
rate on the unpaid balance, all such terms to be set forth in a promissory note
delivered to the seller with normal terms as to acceleration upon any uncured
default.


Nothing contained herein shall be deemed to obligate
any Employer to register any Stock under any federal or state securities law or
to create or maintain a public market to facilitate the transfer or disposition
of any Stock.  The put right described
herein may only be exercised by a person described in the second preceding
paragraph, and may not be transferred with any Stock to any other person.  As to all Stock purchased by the Plan in
exchange for any Stock Obligation, the put right shall be nonterminable.  The put right for Stock acquired through a
Stock Obligation shall continue with respect to such Stock after the Stock
Obligation is repaid or the Plan ceases to be an employee stock ownership plan.


10.7                Restrictions on Disposition of Stock.  Except in the case of Stock which is traded
on an established market, a Participant who receives Stock pursuant to Section
10.1, and any person who has received Stock from the Plan or from such a
Participant by reason of the Participant’s death or incompetency, by reason of
divorce or separation from the Participant, or by reason of a rollover
contribution described in Section 402(a)(5) of the Code, shall, prior to any
sale or other transfer of the Stock to any other person, first offer the Stock
to the issuing Employer and to the Plan at the greater of (i) its current fair
market value, or (ii) the purchase price offered in good faith by an independent
third party purchaser.  This restriction
shall apply to any transfer, whether voluntary, involuntary, or by operation of
law, and whether for consideration or gratuitous.  Either the Employer or the Trustee may accept
the offer within 14 days after it is delivered. 
Any Stock distributed by the Plan shall bear a conspicuous legend
describing the right of first refusal under this Section 10.7, as well as any
other restrictions upon the transfer of the Stock imposed by federal and state
securities laws and regulations.


10.8                Continuing Loan Provisions; Creations of Protections
and Rights.  Except as
otherwise provided in Sections 10.6 and 10.7 and this Section, no shares of
Employer Stock held or distributed by the Trustee may be subject to a put, call
or other option, or buy-sell arrangement. 
The provisions of this Section shall continue to be applicable to such
Stock even if the Plan ceases to be an employee stock ownership plan under
Section 4975(e)(7) of the Code.


10.9                Direct Rollover of Eligible Distribution.  A Participant or distributee may elect, at
the time and in the manner prescribed by the Trustee or the Committee, to have
any portion of an eligible rollover distribution paid directly to an eligible
retirement plan specified by the Participant or distributee in a direct
rollover.



 28
 






 



 


10.9.1      An “eligible rollover” is any distribution
that does not include: any distribution that is one of a series of
substantially equal periodic payments (not less frequently than annually) made
for the life (or life expectancy) of the distributee or the joint lives (or
joint life expectancies) of the Participant and the Participant’s Beneficiary,
or for a specified period of ten years or more; any distribution to the extent
such distribution is required under Code Section 401(a)(9); any hardship
distribution described in Section 401(k)(2)(B)(i)(IV) of the Code; and the
portion of any distribution that is not included in gross income (determined
without regard to the exclusion for net unrealized appreciation with respect to
employer securities).


10.9.2      An “eligible retirement plan” is an
individual retirement account described in Code Section 401(a), an individual
retirement annuity described in Code Section 408(b), an annuity plan described
in Code Section 403(a), or a qualified trust described in Code Section 401(a),
that accepts the distributee’s eligible rollover distribution.  However, in the case of an eligible rollover
distribution to the surviving Spouse, an eligible retirement plan is an
individual retirement account or individual retirement annuity.


Effective
for distributions made after December 31, 2001, for purposes of the direct
rollover provisions in Section 10.9-2 of the Plan, an eligible retirement plan
shall also mean an annuity contract described in Section 403(b) of the Code and
an eligible plan under Section 457(b) of the Code which is maintained by a
state, political subdivision of a state, or any agency or instrumentality of a
state or political subdivision of a state and which agrees to separately account
for amounts transferred into such plan form this Plan.  The definition of eligible retirement plan
shall also apply in the case of a distribution to a surviving spouse, or to a
spouse or former spouse who is the alternate payee under a qualified domestic
relation order, as defined in Section 414(p) of the Code.


10.9.3      A “direct rollover” is a payment by the
Plan to the eligible retirement plan specified by the distributee.


10.9.4      The term “distributee” shall refer to a
deceased Participant’s Spouse or a Participant’s former Spouse who is the
alternate payee under a qualified domestic relations order, as defined in Code
Section 414(p).


10.10  Waiver
of 30 Day Period After Notice of Distribution.  If a distribution is one to which Sections
401(a)(11) and 417 of the Code do not apply, such distribution may commence
less than 30 days after the notice required under Section 1.411(a)-11(c) of the
Income Tax Regulations is given, provided that:


(i)            the Trustee or Administrative Committee, as applicable,
clearly informs the Participant that the Participant has a right to a period of
at least 30 days after receiving the notice to consider the decision of whether
or not to elect a distribution (and, if applicable, a particular option), and



 29
 






 



 


(ii)  the Participant, after
receiving the notice, affirmatively elects a 
distribution.


Section 11.            Rules Governing Benefit Claims and Review of Appeals.


11.1                Claim for Benefits.  Any Participant or Beneficiary who qualifies
for the payment of benefits shall file a claim for his benefits with the
Committee on a form provided by the Committee. 
The claim, including any election of an alternative benefit form, shall
be filed at least 30 days before the date on which the benefits are to begin.  If a Participant or Beneficiary fails to file
a claim by the day before the date on which benefits become payable, he shall
be presumed to have filed a claim for payment for the Participant’s benefits in
the standard form prescribed by Sections 10.1 or 10.2


11.2                Notification by Committee.  Within 90 days after receiving a claim for
benefits (or within 180 days, if special circumstances require an extension of
time and written notice of the extension is given to the Participant or
Beneficiary within 90 days after receiving the claim for benefits), the
Committee shall notify the Participant or Beneficiary whether the claim has
been approved or denied.  If the
Committee denies a claim in any respect, the Committee shall set forth in a
written notice to the Participant or Beneficiary:


(i)                   each
specific reason for the denial;


(ii)                  specific
references to the pertinent Plan provisions on which the denial is based;


(iii)                 a
description of any additional material or information which could be submitted
by the Participant or Beneficiary to support his claim, with an explanation of
the relevance of such information; and


(iv)                 an
explanation of the claims review procedures set forth in Section 11.3.


11.3                Claims Review Procedure.  Within 60 days after a Participant or
Beneficiary receives notice from the Committee that his claim for benefits has
been denied in any respect, he may file with the Committee a written notice of
appeal setting forth his reasons for disputing the Committee’s
determination.  In connection with his appeal the Participant or
Beneficiary or his representative may inspect or purchase copies of pertinent
documents and records to the extent not inconsistent with other Participants’
and Beneficiaries’ rights of privacy. 
Within 60 days after receiving a notice of appeal from a prior determination
(or within 120 days, if special circumstances require an extension of time and
written notice of the extension is given to the Participant or Beneficiary and
his representative within 60 days after receiving the notice of appeal), the
Committee shall furnish to the Participant or Beneficiary and his
representative, if any, a written statement of the Committee’s final decision
with respect to his claim, including the reasons for such decision and the
particular Plan provisions upon which it is based.


 



 30














 


 


Section 12.            The Committee and Its Functions.


12.1                Authority of Committee.  The Committee shall be the “plan
administrator” within the meaning of ERISA and shall have exclusive
responsibility and authority to control and manage the operation and administration
of the Plan, including the interpretation and application of its provisions,
except to the extent such responsibility and authority are otherwise
specifically (i) allocated to the Bank, the Employers, or the Trustee under the
Plan and Trust Agreement, (ii) delegated in writing to other persons by the
Bank, the Employers, the Committee, or the Trustee, or (iii) allocated to other
parties by operation of law.  The
Committee shall have exclusive responsibility regarding decisions concerning
the payment of benefits under the Plan. 
The Committee shall have no investment responsibility with respect to
the Investment Fund except to the extent, if any, specifically provided in the
Trust Agreement.  In the discharge of its
duties, the Committee may employ accountants, actuaries, legal counsel, and
other agents (who also may be employed by an Employer or the Trustee in the
same or some other capacity) and may pay their reasonable expenses and
compensation.


12.2                Identity of Committee.  The Committee shall consist of three or more
individuals selected by the Bank.  Any individual, including a director,
trustee, shareholder, officer, or Employee of an Employer, shall be eligible to
serve as a member of the Committee.  The Bank
shall have the power to remove any individual serving on the Committee at any
time without  cause upon 10 days written
notice, and any individual may resign from the Committee at any time upon 10
days written notice to the Bank.  The
Bank shall notify the Trustee of any change in membership of the Committee.


12.3                Duties of Committee.  The Committee shall keep whatever records may
be necessary to implement the Plan and shall furnish whatever reports may be
required from time to time by the Bank. 
The Committee shall furnish to the Trustee whatever information may be
necessary to properly administer the Trust. 
The Committee shall see to the filing with the appropriate government
agencies of all reports and returns required of the Plan Committee under ERISA
and other laws.


Further, the Committee shall have exclusive
responsibility and authority with respect to the Plan’s holdings of Stock and
shall direct the Trustee in all respects regarding the purchase, retention,
sale, exchange, and pledge of Stock and the creation and satisfaction of Stock
Obligations.  The Committee shall at all
times act consistently with the Bank’s long-term intention that the Plan, as an
employee stock ownership plan, be invested primarily in Stock.  Subject to the direction of the Board as to
the application of Employer contributions to Stock Obligations, and subject to
the provisions of Sections 6.4 and 10.6 as to Participants’ rights under
certain circumstances to have their Accounts invested in Stock or in assets
other than Stock, the Committee shall determine in its sole discretion the
extent to which assets of the Trust shall be used to repay Stock Obligations,
to purchase Stock, or to invest in other assets to be selected by the Trustee
or an investment manager.  No provision
of the Plan relating to the allocation or vesting of any interests in the Stock
Fund or the Investment Fund shall restrict the Committee from changing any
holdings of the Trust, whether the changes involve an increase or a decrease in
the Stock or other assets credited to Participants’ Accounts.  In determining the proper extent of the Trust’s
investment in Stock, the Committee shall be authorized to employ investment 



 31
 






 



counsel, legal counsel, appraisers, and other agents
to pay their reasonable expenses and compensation.


12.4                Valuation of Stock.  If the valuation of any Stock is not
established by reported trading on a generally recognized public market, the
valuation of such Stock shall be determined by an independent appraiser.  For purposes of the preceding sentence, the
term “independent appraiser” means any appraiser meeting requirements similar
to the requirements of the regulations prescribed under Section 170(a)(1) of
the Code.


12.5                Compliance with ERISA.  The Committee shall perform all acts
necessary to comply with ERISA.  Each
individual member or employee of the Committee shall discharge his duties in
good faith and in accordance with the applicable requirements of ERISA.


12.6                Action by Committee.  All actions of the Committee shall be
governed by the affirmative vote of a number of members which is a majority of
the total number of members currently appointed, including vacancies.  The members of the Committee may meet
informally and may take any action without meeting as a group.


12.7                Execution of Documents.  Any instrument executed by the Committee
shall be signed by any member or employee of the Committee.


12.8                Adoption of Rules.  The Committee shall adopt such rules and
regulations of uniform applicability as it deems necessary or appropriate for
the proper administration and interpretation of the Plan.


12.9                Responsibilities to Participants.  The Committee shall determine which Employees
qualify to enter the Plan.  The Committee
shall furnish to each eligible Employee whatever summary plan descriptions,
summary annual reports, and other notices and information may be required under
ERISA.  The Committee also shall
determine when a Participant or his Beneficiary qualifies for the payment of
benefits under the Plan.  The Committee
shall furnish to each such Participant or Beneficiary whatever information is
required under ERISA (or is otherwise appropriate) to enable the Participant or
Beneficiary to make whatever elections may be available pursuant to Sections 6
and 10, and the Committee shall provide for the payment of benefits in the proper
form and amount from the assets of the Trust Fund.  The Committee may decide in its sole
discretion to permit modifications of elections and to defer or accelerate
benefits to the extent consistent with applicable law and the best interests of
the individuals concerned.


12.10              Alternative Payees in Event of Incapacity.  If the Committee finds at any time that an
individual qualifying for benefits under this Plan is a minor or is
incompetent, the Committee may direct the benefits to be paid, in the case of a
minor, to his parents, his legal guardian, or a custodian for him under the
Uniform Gifts to Minors Act, or, in the case of an incompetent, to his spouse,
or his legal guardian, the payments to be used for the individual’s
benefit.  The Committee and the Trustee
shall not be obligated to inquire as to the actual use of the funds by the
person receiving them under this Section 12.10, and any such payment shall 



 32
 






 



completely discharge the obligations of the Plan, the
Trustee, the Committee, and the Employers to the extent of the payment.


12.11              Indemnification by Employers.  Except as separately agreed in writing, the
Committee, and any member or employee of the Committee, shall be indemnified
and held harmless by the Employer, jointly and severally, to the fullest extent
permitted by law against any and all costs, damages, expenses, and liabilities
reasonably incurred by or imposed upon it or him in connection with any claim
made against it or him or in which it or he may be involved by reason of its or
his being, or having been, the Committee, or a member or employee of the
Committee, to the extent such amounts are not paid by insurance.


12.12              Nonparticipation by Interested Member.  Any member of the Committee who also is a
Participant in the Plan shall take no part in any determination specifically
relating to his own participation or benefits, unless his abstention would
leave the Committee incapable of acting on the matter.


Section 13.            Adoption, Amendment, or Termination of the Plan.


13.1                Adoption of Plan by Other Employers.  With the consent of the Bank, any entity may
become a participating Employer under the Plan by (i) taking such action as
shall be necessary to adopt the Plan, (ii) becoming a party to the Trust
Agreement establishing the Trust Fund, and (iii) executing and delivering such
instruments and taking such other action as may be necessary or desirable to
put the Plan into effect with respect to the entity’s Employees.


13.2                Adoption of Plan by Successor.  In the event that any Employer shall be reorganized
by way of merger, consolidation, transfer of assets or otherwise, so that an
entity other than an Employer shall succeed to all or substantially all of the
Employer’s business, the successor entity may be substituted for the Employer
under the Plan by adopting the Plan and becoming a party to the Trust
Agreement.  Contributions by the Employer shall be automatically suspended
from the effective date of any such reorganization until the date upon which
the substitution of the successor entity for the Employer under the Plan
becomes effective.  If, within 90 days
following the effective date of any such reorganization, the successor entity
shall not have elected to become a party to the Plan, or if the Employer shall
adopt a plan of complete liquidation other than in connection with a
reorganization, the Plan shall be automatically terminated with respect to
Employees of the Employer as of the close of business on the 90th day following
the effective date of the reorganization, or as of the close of business on the
date of adoption of a plan of complete liquidation, as the case may be.


13.3                Plan Adoption Subject to Qualification.  Notwithstanding any other provision of the
Plan, the adoption of the Plan and the execution of the Trust Agreement are
conditioned upon their being determined initially by the Internal Revenue
Service to meet the qualification requirements of Section 401(a) of the Code,
so that the Employers may deduct currently for federal income tax purposes
their contributions to the Trust and so that the Participants may exclude the
contributions from their gross income and recognize income only when they
receive benefits.  In the event that this
Plan is held by the Internal Revenue Service not to qualify initially under
Section 401(a), the Plan may be amended retroactively to the earliest date 



 33
 






 



permitted by U.S. Treasury Regulations in order to
secure qualification under Section 401(a). 
If this Plan is held by the Internal Revenue Service not to qualify
initially under Section 401(a) either as originally adopted or as amended, each
Employer’s contributions to the Trust under this Plan (including any earnings
thereon) shall be returned to it and this Plan shall be terminated.  In the event that this Plan is amended after
its initial qualification and the Plan as amended is held by the Internal
Revenue Service not to qualify under Section 401(a), the amendment may be
modified retroactively to the earliest date permitted by U.S. Treasury
Regulations in order to secure approval of the amendment under Section 401(a).


13.4                Right to Amend or Terminate.  The Bank intends to continue this Plan as a
permanent program.  However, each
participating Employer separately reserves the right to suspend, supersede, or
terminate the Plan at any time and for any reason, as it applies to that
Employer’s Employees, and the Bank reserves the right to amend, suspend,
supersede, merge, consolidate, or terminate the Plan at any time and for any
reason, as it applies to the Employees of each Employer.  No amendment, suspension, supersession,
merger, consolidation, or termination of the Plan shall (i) reduce any
Participant’s or Beneficiary’s proportionate interest in the Trust Fund, (ii)
reduce or restrict, either directly or indirectly, the benefit provided any
Participant prior to the amendment, or (iii) divert any portion of the Trust
Fund to purposes other than the exclusive benefit of the Participants and their
Beneficiaries prior to the satisfaction of all liabilities under the Plan.  Moreover, there shall not be any transfer of
assets to a successor plan or merger or consolidation with another plan unless,
in the event of the termination of the successor plan or the surviving plan
immediately following such transfer, merger, or consolidation, each participant
or beneficiary would be entitled to a benefit equal to or greater than the
benefit he would have been entitled to if the plan in which he was previously a
participant or beneficiary had terminated immediately prior to such transfer,
merger, or consolidation.  Following a
termination of this Plan by the Bank, the Trustee shall continue to administer
the Trust and pay benefits in accordance with the Plan as amended from time to
time and the Committee’s instructions.


Section 14.            Miscellaneous Provisions.


14.1                Plan Creates No Employment Rights.  Nothing in this Plan shall be interpreted as
giving any Employee the right to be retained as an Employee by an Employer, or
as limiting or affecting the rights of an Employer to control its Employees or
to terminate the Service of any Employee at any time and for any reason,
subject to any applicable employment or collective bargaining agreements.


14.2                Nonassignability of Benefits.  No assignment, pledge, or other anticipation
of benefits from the Plan will be permitted or recognized by the Employer, the
Committee, or the Trustee.  Moreover,
benefits from the Plan shall not be subject to attachment, garnishment, or
other legal process for debts or liabilities of any Participant or Beneficiary,
to the extent permitted by law.  This
prohibition on assignment or alienation shall apply to any judgment, decree, or
order (including approval of a property settlement agreement) which relates to
the provision of child support, alimony, or property rights to a present or
former spouse, child or other dependent of a Participant pursuant to a State
domestic relations or community property law, unless the judgment, decree, or
order is determined by the Committee to be a qualified 



 34
 






 



domestic relations order within the meaning of Section
414(p) of the Code, as more fully set forth in Section 14.12 hereof.


14.3                Limit of Employer Liability.  The liability of the Employer with respect to
Participants under this Plan shall be limited to making contributions to the
Trust from time to time, in accordance with Section 4.


14.4                Treatment of Expenses.  All expenses incurred by the Committee and
the Trustee in connection with administering this Plan and Trust Fund shall be
paid by the Trustee from the Trust Fund to the extent the expenses have not
been paid or assumed by the Employer or by the Trustee and to the extent
consistent with Department of Labor Field Bulletin 2003-3.


14.5                Number and Gender.  Any use of the singular shall be interpreted
to include the plural, and the plural the singular.  Any use of the masculine, feminine, or neuter
shall be interpreted to include the masculine, feminine, or neuter, as the
context shall require.


14.6                Nondiversion of Assets.  Except as provided in Sections 5.3 and 13.3,
under no circumstances shall any portion of the Trust Fund be diverted to or
used for any purpose other than the exclusive benefit of the Participants and
their Beneficiaries prior to the satisfaction of all liabilities under the
Plan.


14.7                Separability of Provisions.  If any provision of this Plan is held to be
invalid or unenforceable, the other provisions of the Plan shall not be
affected but shall be applied as if the invalid or unenforceable provision had
not been included in the Plan.


14.8                Service of Process.  The agent for the service of process upon the
Plan shall be the president of the Bank, or such other person as may be
designated from time to time by the Bank.


14.9                Governing  Law.  This Plan shall be interpreted in accordance
with the laws of the Commonwealth of Massachusetts to the extent those laws are
applicable under the provisions of ERISA.


14.10              Employer Contributions Conditioned on Deductibility.  Employer Contributions to the Plan are
conditioned on deductibility under Code Section 404.  In the event that the Internal Revenue
Service shall determine that all or any portion of an Employer Contribution is
not deductible under that Section, the nondeductible portion shall be returned
to the Employer within one year of the disallowance of the deduction.


14.11              Unclaimed Accounts.  Neither the Employer nor the Trustees shall
be under any obligation to search for, or ascertain the whereabouts of, any
Participant or Beneficiary.  The Employer
or the Trustees, by certified or registered mail addressed to his last known
address of record with the Employer, shall notify any Participant or
Beneficiary that he is entitled to a distribution under this Plan, and the
notice shall quote the provisions of this Section.  If the Participant or Beneficiary fails to
claim his benefits or make his whereabouts known in writing 



 35
 






 



to the Employer or the Trustees within seven (7)
calendar years after the date of notification, the benefits of the Participant
or Beneficiary under the Plan will be disposed of as follows:


(a)           If the whereabouts of the Participant is unknown but the
whereabouts of the Participant’s Beneficiary is known to the Trustees,
distribution will be made to the Beneficiary.


(b)           If the whereabouts of the Participant and his Beneficiary
are unknown to the Trustees, the Plan will forfeit the benefit, provided that
the benefit is subject to a claim for reinstatement if the Participant or
Beneficiary make a claim for the forfeited benefit.


Any payment made pursuant to the power herein
conferred upon the Trustees shall operate as a complete discharge of all
obligations of the Trustees, to the extent of the distributions so made.


14.12              Qualified Domestic Relations Order.  Section 14.2 shall not apply to a “qualified
domestic relations order” defined in Code Section 414(p), and such other
domestic relations orders permitted to be so treated by Administrator under the
provisions of the Retirement Equity Act of 1984.  Further, to the extent provided under a “qualified
domestic relations order”, a former Spouse of a Participant shall be treated as
the Spouse or surviving Spouse for all purposes under the Plan.


In
the case of any domestic relations order received by the Plan:


(a)           The Employer or the Plan Committee shall promptly notify
the Participant and any other alternate payee of the receipt of such order and
the Plan’s procedures for determining the qualified status of domestic
relations orders, and


(b)           Within a reasonable period after receipt of such order,
the Employer or the Plan Committee shall determine whether such order is a
qualified domestic relations order and notify the Participant and each
alternate payee of such determination. 
The Employer or the Plan Committee shall establish reasonable procedures
to determine the qualified status of domestic relations orders and to
administer distributions under such qualified orders.


During any period in which the issue of whether a
domestic relations order is a qualified domestic relations order is being
determined (by the Employer or Plan Committee, by a court of competent
jurisdiction, or otherwise), the Employer or the Plan Committee shall segregate
in a separate account in the Plan or in an escrow account the amounts which
would have been payable to the alternate payee during such period if the order
had been determined to be a qualified domestic relations order.  If within eighteen (18) months the order (or
modification thereof) is determined to be a qualified domestic relations order,
the Employer or the Plan Committee shall pay the segregated amounts (plus any
interest thereon) to the person or persons entitled thereto.  If within eighteen (18) months it is
determined that the order is not a qualified domestic relations order, or the
issue as to whether such order is a qualified domestic relations order is not
resolved, then the Employer or the Plan Committee shall pay the segregated
amounts 



 36
 






 



(plus any interest thereon) to the person or persons
who would have been entitled to such amounts if there had been no order.  Any determination that an order is a
qualified domestic relations order which is made after the close of the
eighteen (18) month period shall be applied prospectively only.  The term “alternate payee” means any Spouse,
former Spouse, child or other dependent of a Participant who is recognized by a
domestic relations order as having a right to receive all, or a portion of, the
benefit payable under a Plan with respect to such Participant.


Section 15.            Top-Heavy Provisions.


15.1                Top-Heavy Plan.  For any Plan Year beginning after December
31, 1983, this Plan is top-heavy if any of the following conditions exist:


(a)  If the
top-heavy ratio for this Plan exceeds sixty percent (60%) and this Plan is not
part of any required aggregation group or permissive aggregation group;


(b)  If this
Plan is a part of a required aggregation group (but is not part of a permissive
aggregation group) and the aggregate top-heavy ratio for the group of Plans
exceeds sixty percent (60%); or


(c)  If this
Plan is a part of a required aggregation group and part of a permissive
aggregation group and the aggregate top-heavy ratio for the permissive
aggregation group exceeds sixty percent (60%).


15.2                Super Top-Heavy Plan.  For any Plan Year beginning after December
31, 1983, this Plan will be a super top-heavy Plan if any of the following
conditions exist:


(a)  If the
top-heavy ratio for this Plan exceeds ninety percent (90%) and this Plan is not
part of any required aggregation group or permissive aggregation group.


(b)  If this
Plan is a part of a required aggregation group (but is not part of a permissive
aggregation group) and the aggregate top-heavy ratio for the group of Plans
exceeds ninety percent (90%), or


(c)  If this Plan is a part of a required
aggregation group and part of a permissive aggregation group and the aggregate
top-heavy ratio for the permissive aggregation group exceeds ninety percent
(90%).


15.3                Definitions.


In making this determination, the Committee shall
use the following definitions and principles:


15.3.1  The “Determination Date”, with respect to the
first Plan Year of any plan, means the last day of that Plan Year, and with
respect to each subsequent Plan Year, means the last day of the preceding Plan
Year.  If any other plan has a
Determination Date which differs from this Plan’s Determination Date, the
top-heaviness of this Plan shall be determined on the basis of the other plan’s
Determination Date falling within the same calendar years as this Plan’s
Determination Date.



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15.3.2  A “Key Employee”, with respect to a Plan
Year, means an Employee who at any time during the five years ending on the
top-heavy Determination Date for the Plan Year has received compensation from
an Employer and has been (i) an officer of the Employer having 415 Compensation
greater than 50 percent of the limit then in effect under Section 415(b)(1)(A)
of the Code, (ii) one of the 10 Employees owning the largest interests in the
Employer having 415 Compensation greater than the limit then in effect under
Section 415(c)(1)(A), (iii) an owner of more than five percent of the
outstanding equity interest or the outstanding voting interest in any Employer,
or (iv) an owner of more than one percent of the outstanding equity interest or
the outstanding voting interest in an Employer whose annual compensation
exceeds $150,000.  For Plan Years commencing
on or after January 1, 2001, a “Key Employee” means any Employee or former
Employee (including any deceased Employee) who at any time during the Plan Year
that includes the Determination Date was an officer of the Employer having
annual compensation greater than $130,000 (as adjusted under section 416(i)(1)
of the Code for Plan Years beginning after December 31, 2002), a five percent
owner of the Employer, or a one-percent owner of the Employer having annual
compensation of more than $150,000.  The
determination of who is a key employee will be made in accordance with section
416(i)(1) of the Code and the applicable regulations and other guidance of
general applicability issued hereunder. For purposes of determining whether an
Employee is a Key Employee, annual compensation means compensation as defined
in Section 415(c)(3) of the Code, but including amounts contributed by the
Employee pursuant to a salary reduction agreement which are excludable from the
Employee’s gross income under Section 125, Section 402(e)(3), Section
402(H)(1)(B) or Section 403(b) of the Code, and for Plan Years commencing on or
after January 1, 2001, under section 132(f)(4) of the Code.  The Beneficiary of a Key Employee shall also
be considered a Key Employee.


15.3.3  A “Non-key Employee” means an Employee who at
any time during the five years ending on the top-heavy Determination Date for
the Plan Year has received compensation from an Employer and who has never been
a Key Employee, and the Beneficiary of any such Employee.


15.3.4       A “required aggregation group” includes
(a) each qualified Plan of the Employer in which at least one Key Employee
participates in the Plan Year containing the Determination Date and any of the
four (4) preceding Plan Years, and (b) any other qualified Plan of the Employer
which enables a Plan described in (a) to meet the requirements of Code Sections
401(a)(4) or 410.  For purposes of the
preceding sentence, a qualified Plan of the Employer includes a terminated Plan
maintained by the Employer within the five (5) year period ending on the Determination
Date.  In the case of a required
aggregation group, each Plan in the group will be considered a top-heavy Plan
if the required aggregation group is a top-heavy group.  No Plan in the required aggregation group
will be considered a top-heavy Plan if the required aggregation group is not a
top-heavy group.  All Employers
aggregated under Code Sections 414(b), (c) or (m) or (o) (but only after the
Code Section 414(o) regulations become effective) are considered a single
Employer.



 38
 






 



 


15.3.5  A “permissive aggregation group” includes the
required aggregation group of Plans plus any other qualified Plan(s) of the
Employer that are not required to be aggregated but which, when considered as a
group with the required aggregation group, satisfy the requirements of Code
Sections 401(a)(4) and 410 and are comparable to the Plans in the required
aggregation group.  No Plan in the
permissive aggregation group will be considered a top-heavy Plan if the
permissive aggregation group is not a top-heavy group.  Only a Plan that is part of the required
aggregation group will be considered a top-heavy Plan if the permissive
aggregation group is top-heavy.


15.4                Top-Heavy Rules of Application.


 For purposes
of determining the value of Account balances and the present value of accrued
benefits the following provisions shall apply:


15.4.1  The value of Account balances and the present
value of accrued benefits will be determined as of the most recent Valuation
Date that falls within or ends with the twelve (12) month period ending on the
Determination Date.


15.4.2      For purposes of testing whether this Plan
is top-heavy, the present value of an individual’s accrued benefits and an
individual’s Account balances is counted only once each year.


15.4.3      The Account balances and accrued benefits
of a Participant who is not presently a Key Employee but who was a Key Employee
in a Plan Year beginning on or after January 1, 1984 will be disregarded.


15.4.4       Employer contributions attributable to a
salary reduction or similar arrangement will be taken into account.


15.4.5      When aggregating Plans, the value of
Account balances and accrued benefits will be calculated with reference to the
Determination Dates that fall within the same calendar year.


15.4.6      The present value of
the accrued benefits or the amount of the Account balances of an Employee shall
be increased by the aggregate distributions made to such Employee from a Plan
of the Employer.  No distribution,
however, made from the Plan to an individual (other than the beneficiary of a
deceased Employee who was an Employee within the five (5) year period ending on
the Determination Date) who has not been an Employee at any time during the
five (5) year period ending on the Determination Date shall be taken into
account in determining whether the Plan is top-heavy.  Also, any amounts recontributed by an
Employee upon becoming a Participant in the Plan shall no longer be counted as
a distribution under this paragraph.  For
Plan Years commencing on or after January 1, 2001, present values of accrued
benefits and the amounts of account balances of an Employee as of the
determination date shall be increased by the distribution made with respect to
the Employee under the Plan and any plan aggregated with the Plan under Section
416(g)(2) of the Code during the one-year period ending on 



 39
 






 



the determination date.  The
preceding sentence shall also apply to distributions under a terminated plan
which, had it not been terminated, would have been aggregated with the Plan
under section 416(g)(2)(A)(i) of the Code. 
In the case of a distribution made for a reason other than separation
from service, death, or disability, this provision shall be applied by
substituting “five-year period” for “one-year period.”


15.4.7      The present value of
the accrued benefits or the amount of the Account balances of an Employee shall
be increased by the aggregate distributions made to such Employee from a
terminated Plan of the Employer, provided that such Plan (if not terminated)
would have been required to be included in the aggregation group.


15.4.8      Accrued benefits and Account balances of
an individual shall not be taken into account for purposes of determining the
top-heavy ratios if the individual has performed no services for the Employer
during the five (5) year period ending on the applicable Determination
Date.  For Plan Years commencing on or
after January 1, 2001, the accrued benefits and Account balances of any
individual who has not performed services for the Employer during the one-year
period ending on the Determination Date should not be taken into account.  Compensation for purposes of this
subparagraph shall not include any payments made to an individual by the
Employer pursuant to a qualified or non-qualified deferred compensation plan.


15.4.9      The present value of the accrued benefits
or the amount of the Account balances of any Employee participating in this
Plan shall not include any rollover contributions or other transfers
voluntarily initiated by the Employee except as described below.  If a rollover was received by this Plan after
December 31, 1983, the rollover or transfer voluntarily initiated by the
Employee was received prior to January 1, 1984, then the rollover or transfer
shall be considered as part of the accrued benefit by the Plan receiving such
rollover or transfer.  If this Plan
transfers or rolls over funds to another Plan in a transaction voluntarily
initiated by the Employee after December 31, 1983, then this Plan shall count
the distribution for purposes of determining Account balances or the present
value of accrued benefits.  A transfer
incident to a merger or consolidation of two or more Plans of the Employer
(including Plans of related Employers treated as a single Employer under Code
Section 414), or a transfer or rollover between Plans of the Employer, shall
not be considered as voluntarily initiated by the Employee.


15.5                Top-Heavy Ratio.


If the Employer maintains
one (1) or more defined contribution plans (including any simplified Employee
pension plan) and the Employer has never maintained any defined benefit plans
which have covered or could cover a Participant in this Plan, the top-heavy
ratio is a fraction, the numerator of which is the sum of the Account balances
of all Key Employees as of the Determination Date, and the denominator of which
is the sum of the Account balances of all Employees as of the Determination
Date.  Both the numerator and denominator
of the top-heavy ratio shall be increased to reflect any contribution which is
due but unpaid as of the Determination Date.



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If the Employer maintains
one (1) or more defined contribution plans (including any simplified Employee
pension plan) and the Employer maintains or has maintained one (1) or more
defined benefit plans which have covered or could cover a Participant in this
Plan, the top-heavy ratio is a fraction, the numerator of which is the sum of
Account balances under the defined contribution plans for all Key Employees and
the present value of accrued benefits under the defined benefit plans for all
Key Employees, and the denominator of which is the sum of the Account balances
under the defined contribution plans for all Employees and the present value of
accrued benefits under the defined benefit plans for all Employees.


For these purposes, the
accrued benefit of a Participant other than a key Employee in a defined benefit
plan shall be determined under (a) the method, if any, that uniformly applies
for accrual purposes under all defined benefit plans maintained by the
Employer, or (b) of there is no such method, as if such benefit accrued not
more rapidly than the slowest accrual rate permitted under the fractional rule
of Section 411(b)(1)(C).


15.6                Minimum
Contributions.  For any
Top-Heavy Year, each Employer shall make a special contribution on behalf of
each Participant to the extent that the total allocations to his Account
pursuant to Section 4 is less than the lesser of:


(i)   three percent of his 415 Compensation for
that year, or


(ii)  the highest ratio of such allocation to 415
Compensation received by any Key Employee for that year.  For purposes of
the special contribution of this Section 15.2, a Key Employee’s 415
Compensation shall include amounts the Key Employee elected to defer under a
qualified 401(k) arrangement.  Such a
special contribution shall be made on behalf of each Participant who is
employed by an Employer on the last day of the Plan Year, regardless of the
number of his Hours of Service, and shall be allocated to his Account.


If the Employer maintains a qualified plan in
addition to this Plan and more than one such plan is determined to be
Top-Heavy, a minimum contribution or a minimum benefit shall be provided in one
of such other plans, including, after January 1, 2001, a plan that consists
solely of a cash or deferral arrangement which meets the requirements of
Section 401(k)(12) of the Code and matching contributions with respect to the
requirements of Section 401(m)(11) of the Code are met.  For any Plan Year when (1) the Plan is
top-heavy and (2) a Non-key Employee is a Participant in both this Plan and a
defined benefit plan included in the plan aggregation group which is top heavy,
the sum of the Employer contributions and forfeitures allocated to the Account
of each such Non-key Employee shall be equal to at least five percent (5%) of
such Non-key Employee’s 415 Compensation for that year.


15.7                Minimum Vesting.  For any Plan year in which this Plan is
Top-Heavy, a participant’s vested interest in his Account shall be based on the
following “top-heavy table”:



 41
 






 



 


	
  Vesting

  Years

  	
   

  	
  Percentage of

  Interest Vested

  
	
  Fewer than 2 years

  	
   

  	
  0%

  
	
  2

  	
   

  	
  20%

  
	
  3

  	
   

  	
  40%

  
	
  4

  	
   

  	
  60%

  
	
  5

  	
   

  	
  80%

  
	
  6

  	
   

  	
  100%

  



 


15.8                Top-Heavy Provisions Control in Top-Heavy Plan.  In the event this Plan becomes top-heavy and
a conflict arises between the top-heavy provisions herein set forth and the remaining
provisions set forth in this Plan, the top-heavy provisions shall control.



 42