TERRITORIAL SAVINGS BANK
                           NON-QUALIFIED SUPPLEMENTAL
                          EMPLOYEE STOCK OWNERSHIP PLAN


     1. Purpose

     This Non-Qualified  Supplemental  Employee Stock Ownership Plan ("Plan") is
intended to provide Participants (as defined herein) or their Beneficiaries with
the  economic  value of the annual  allocations  credited to such  Participant's
account  under The  Territorial  Savings  Bank  Employee  Stock  Ownership  Plan
("ESOP") which may not be accrued under said ESOP due to the limitations imposed
by Section 415 of the Internal  Revenue Code (the "Code") and the  limitation on
includible  compensation  imposed  by  Code  Section  401(a)(17).  The  benefits
provided  under  this Plan (as  described  below)  are  intended  to  constitute
deferred  compensation  for "a select group of management or highly  compensated
employees" for purposes of the Employee  Retirement Income Security Act of 1974,
as amended  ("ERISA").  This Plan is intended to comply with Section 409A of the
Internal  Revenue Code ("Code") and the  regulatory  guidance and other guidance
issued thereunder.

     2. Definitions

     Where the following  words and phrases appear in the Plan,  they shall have
the respective  meaning as set forth below unless the context clearly  indicates
the contrary. Except to the extent otherwise indicated herein, and to the extent
inconsistent with the definitions  provided below, the definitions  contained in
the ESOP are applicable under the Plan.

          2.1 "Account" means the  bookkeeping  account to which a Participant's
Annual ESOP Credits and earnings thereon are credited.

          2.2  "Annual   ESOP   Credit"   means  the  amount   credited  to  the
Participant's  account  in the  Plan,  determined  as set forth in  Section  4.1
hereof.

          2.3 "Applicable  Limitations"  means one or more of the following,  as
applicable:  (i) the maximum  limitations on annual additions to a tax-qualified
defined  contribution  plan  under  Code  Section  415(c);  or (ii) the  maximum
limitation on the annual  amount of  compensation  that may,  under Code Section
401(a)(17),  be taken into account in determining  contributions to and benefits
under tax-qualified plans.

          2.4 "Bank" means Territorial Savings Bank.

          2.5 "Beneficiary" means the person designated by the Participant under
the  ESOP  to  receive  the  Supplemental  ESOP  Benefit  in  the  event  of the
Participant's death.

          2.6 "Board of Directors"  means the Board of Directors of  Territorial
Savings Bank.

          2.7 "Change in Control"  shall mean (1) a change in  ownership  of the
Company or the Bank under  paragraph  (i)  below,  or (2) a change in  effective
control of the


<PAGE>


Company or the Bank under paragraph (ii) below, or (3) a change in the ownership
of a  substantial  portion  of the  assets  of the  Company  or the  Bank  under
paragraph (iii) below:

               i. Change in the ownership of the Bank. A change in the ownership
               of the Bank shall occur on the date that any one person,  or more
               than  one  person  acting  as a group  (as  defined  in  Treasury
               Regulation Section  1.409A-3(i)(5)(v)(B)),  acquires ownership of
               stock of the corporation  that,  together with stock held by such
               person or  group,  constitutes  more  than 50% of the total  fair
               market  value  or  total  voting  power  of  the  stock  of  such
               corporation; or

               ii. Change in the effective  control of the Bank. A change in the
               effective control of the Bank shall occur on the date that either
               (i) any one person, or more than one person acting as a group (as
               defined in Treasury  Regulation  Section  1.409A-3(i)(5)(vi)(D)),
               acquires (or has acquired  during the 12-month  period  ending on
               the  date  of the  most  recent  acquisition  by such  person  or
               persons) ownership of stock of the Bank possessing 30% or more of
               the  total  voting  power  of the  stock of the  Bank;  or (ii) a
               majority of members of the Bank's  board of Directors is replaced
               during any 12-month  period by  Directors  whose  appointment  or
               election  is not  endorsed  by a majority  of the  members of the
               corporation's  board  of  Directors  prior  to  the  date  of the
               appointment or election,  provided that this  sub-section (ii) is
               inapplicable where a majority  shareholder of the Bank is another
               corporation; or

               iii.  Change in the  ownership  of a  substantial  portion of the
               Bank's assets. A change in the ownership of a substantial portion
               of the Bank's assets shall occur on the date that any one person,
               or more than one person acting as a group (as defined in Treasury
               Regulation  Section  1.409A-3(i)(5)(vii)(C)),  acquires  (or  has
               acquired  during the  12-month  period  ending on the date of the
               most recent  acquisition  by such person or persons)  assets from
               the Bank that have a total  gross fair  market  value equal to or
               more than 40% of the total gross fair market  value of all of the
               assets of the corporation  immediately  prior to such acquisition
               or acquisitions.  For this purpose, gross fair market value means
               the value of the assets of the  corporation,  or the value of the
               assets  being  disposed  of,  determined  without  regard  to any
               liabilities  associated  with such assets.  There is no Change in
               Control event under this paragraph (iii) when there is a transfer
               to an  entity  that  is  controlled  by the  shareholders  of the
               transferring corporation immediately after the transfer; or

               iv.  For all  purposes  hereunder,  the  definition  of Change in
               Control shall be construed to be consistent with the requirements
               of  Treasury  Regulation  Section  1.409A-3(i)(5),  except to the
               extent modified herein.

          2.8 "Code"  means the Internal  Revenue Code of 1986,  as amended from
time to time.  Reference to a specific  provision of the Code shall include such
provision,  any  valid


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<PAGE>


regulation or ruling  promulgated  thereunder  and any  comparable  provision of
future law that amends, supplements or supersedes such provision.

          2.9  "Committee"  means  the  Compensation  Committee  of the Board of
Directors.

          2.10 "Company" means Territorial Bancorp, Inc.

          2.11 "Effective Date" means January 1, 2009.

          2.12  "Employee"  means an  employee of the  Employer on whose  behalf
benefits are payable under the ESOP.

          2.13 "Employer" means the Bank or the Company, as applicable,  and any
successors by merger, purchase,  reorganization or otherwise. If a subsidiary or
affiliate of the Employer  adopts the Plan, it shall be deemed the Employer with
respect to its employees.

          2.14 "ERISA"  means the  Employee  Retirement  Income  Security Act of
1974, as amended from time to time.  Reference to a specific  provision of ERISA
shall  include  such  provision,  any valid  regulation  or  ruling  promulgated
thereunder and any comparable  provision of future law that amends,  supplements
or supersedes such provision.

          2.15 "ESOP" means the tax-qualified  Territorial Savings Bank Employee
Stock Ownership Plan, and any successor thereto.

          2.16  "Participant"  means an  Employee  who has been  designated  for
participation in this Plan pursuant to Section 3.1.

          2.17 "Plan" means Territorial Savings Bank Non-Qualified  Supplemental
Employee  Stock  Ownership  Plan, as set forth herein and as may be amended from
time to time.

          2.18 "Plan Year" means the period from January 1 to December 31.

          2.19 "Separation from Service" means the Employee's death,  Retirement
or other  termination  of  employment  with the Bank  within the meaning of Code
Section  409A.  No  Separation  from  Service  shall be  deemed  to occur due to
military leave,  sick leave or other bona fide leave of absence if the period of
such leave does not exceed six months or, if longer,  so long as the  Employee's
right to reemployment  is provided by law or contract.  If the leave exceeds six
months and the  Employee's  right to  reemployment  is not provided by law or by
contract,  then the Employee  shall have a Separation  from Service on the first
date immediately following such six-month period.

     Whether a  termination  of employment  has occurred is determined  based on
whether the facts and  circumstances  indicate  that the  Employer  and Employee
reasonably  anticipated  that no further  services  would be  performed  after a
certain date or that the level of bona fide services the employee  would perform
after such date (whether as an employee or as an independent  contractor)  would
permanently  decrease  to no more  than 20% of the  average  level of bona  fide
services  performed  over the  immediately  preceding  36 months (or such lesser
period of time in


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<PAGE>


which the Participant  performed  services for the Bank).  The  determination of
whether  a  Participant  has had a  Separation  from  Service  shall  be made by
applying  the  presumptions  set forth in the  Treasury  Regulations  under Code
Section 409A.

          2.20 "Specified Employee" means any Participant who also satisfies the
definition  of "key  employee"  as such term is defined in Code  Section  416(i)
(without  regard  to  paragraph  5  thereof).  In the event a  Participant  is a
Specified  Employee,  no  distribution  shall be made to such  Participant  upon
Separation  from Service  (other than due to death or  Disability)  prior to the
first day of the seventh month following Separation from Service.

          2.21 "Stock" means the common stock of the Company, par value $.01 per
share.

          2.22  "Supplemental  ESOP  Benefit"  means the benefit  provided for a
Participant under this Plan.

          2.23  "Surviving  Spouse"  means  the legal  spouse of a  Participant,
living at the time of the death of the Participant.

     3. Participation

          3.1 Designation to Participate. Upon the designation of the Committee,
and subject to the  approval  of the Board of  Directors,  Employees  may become
Participants at any time during the Plan Year. Each Employee  initially selected
by the  Committee  to  participate  in the Plan  shall be set forth on Exhibit A
attached hereto and made a part hereof.

          3.2  Continuation  of  Participation.  An  Employee  who has  become a
Participant  shall  remain a  Participant  so long as benefits are payable to or
with respect to such Participant under the Plan.

     4. Benefit Requirements and Payments

          4.1  Supplemental  ESOP Benefits.  A Participant  shall be entitled to
receive as a benefit from this Plan the Supplemental ESOP Benefit  determined as
set  forth  herein.  In the  event of the  death of a  Participant  prior to the
commencement of payment of the Supplemental  ESOP Benefit,  the Surviving Spouse
of the  Participant  shall be entitled to receive as a benefit from this Plan an
amount  equal to 100% of the  Supplemental  ESOP  Benefit  that  would have been
payable to the  Participant  at the time of his  death.  The  Supplemental  ESOP
Benefit shall be that benefit earned by a Participant upon the investment of the
Annual ESOP Credits allocated to his Account. The Annual ESOP Credit is equal to
the sum of the difference (expressed in dollars) between "(a)" and "(b)," where:

               (a) is the  number  of  shares  of Stock  that  would  have  been
               allocated to the account of the Participant for a Plan Year under
               the ESOP and the dividends  and earnings  thereon paid during the
               Plan Year, but for the Applicable Limitations,  multiplied by the
               fair market  value of such Stock on the last day of the Plan Year
               for which the allocation is made; and


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<PAGE>


               (b) is the number of shares of Stock  actually  allocated  to the
               account  of the  Participant  for the  relevant  ESOP Plan  Year,
               multiplied by the fair market value of such Stock on the last day
               of the Plan  Year  for  which  the  allocation  is made,  and the
               dividends and earnings thereon paid during the Plan Year.

          4.2 Investment of Annual ESOP Credits.  Participants shall be entitled
to invest the Annual ESOP  Credits  allocated  to their  Account  among a select
group of broadly  diversified mutual funds selected by the Committee.  For these
purposes,  an investment shall be deemed to be made to a mutual fund (whether or
not actually made) when the Participant  gives such instruction to the Committee
that such  investment  shall be made. The frequency  with which such  investment
instruction  may be given to the Committee  shall be determined by the Committee
in its sole discretion. If the Employer establishes a rabbi trust and sets aside
assets to informally fund the benefit  obligation under this Plan, the Committee
may  permit  Participants  the  opportunity  to direct the  investment  of their
Account  under the rabbi trust,  but the Committee is not obligated to do so. If
the Employer establishes a rabbi trust but the Participants are not permitted to
actually invest their Accounts through  investment in the rabbi trust, the value
of a Participant's  Account shall nonetheless be determined on the basis of such
Participant's deemed investments.

          4.3  Incidents of  Supplemental  ESOP  Payments.  Benefits  under this
Section 4 shall be  payable to the  Participant  in a lump sum within 90 days of
the first to occur of:

               (a) the  Participant's  "Separation from Service," other than due
               to death or Disability;

               (b) the Participant's Disability;

               (c) the Participant's death; or

               (d) a Change in Control of the Bank or the Company.

     Notwithstanding  anything  herein to the contrary,  if the Participant is a
Specified  Employee  and  the  distribution  under  this  Section  is due to the
Participants  Separation from Service,  solely to the extent  necessary to avoid
penalties under Code Section 409A, the  distribution (or any part thereof) shall
be delayed until the first day of the seventh month  following  Separation  from
Service.

          4.4 Form of Supplemental ESOP Payments.  A Participant's  supplemental
ESOP  benefits  under  Section 4.1 of this Plan shall be a benefit  paid in cash
equal to the value of the Participant's Account. The Participant's Account shall
be paid to the  Participant  upon the  occurrence  of the  event and at the time
specified in Section 4.3 above.

     5. Administration of the Plan

          5.1  Committee;  Duties.  This  Plan  shall  be  administered  by  the
Committee  which shall  consist of not less than three (3) persons  appointed by
the Board of Directors.  The Committee shall have the authority to make,  amend,
interpret  and  enforce  all   appropriate   rules


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<PAGE>


and regulations for the administration of the Plan and decide or resolve any and
all  questions,  including  interpretations  of this  Plan,  that  may  arise in
connection with the administration of the Plan; provided, however, that any such
interpretations,   rules  and/or   regulations  shall  be  consistent  with  the
requirements of Code Section 409A and any Treasury Regulations or other guidance
issued  thereunder.  A majority vote of the Committee  members shall control any
decision.  Members of the Committee may be Participants  under the Plan, so long
as a majority of the members are not Participants.

          5.2 Agents.  The Committee may, from time to time, employ other agents
and  delegate to them such  administrative  duties as it sees fit,  and may from
time to time consult with counsel who may be counsel to the Employer.

          5.3  Binding  Effect  of  Decisions.  The  decision  or  action of the
Committee  regarding of any question  arising out of or in  connection  with the
administration,  interpretation  and  application  of the Plan and the rules and
regulations promulgated hereunder shall be final and conclusive and binding upon
all persons having any interest in the Plan.

          5.4  Indemnity of  Committee.  The Employer  shall  indemnify and hold
harmless the members of the Committee against any and all claims,  loss, damage,
expense or  liability  arising from any action or failure to act with respect to
this Plan, except in the case of gross negligence or willful misconduct.

     6. Claims Procedure

          6.1 Claim. Any person claiming a benefit, requesting an interpretation
or ruling under the Plan, or requesting information under the Plan shall present
the request in writing to the Committee  which shall  respond in writing  within
thirty (30) days.

          6.2 Denial of Claim.  If the claim or request is denied,  the  written
notice of denial shall state:

               (a) the reason for denial,  with  specific  reference to the Plan
               provisions on which the denial is based.

               (b) a  description  of any  additional  material  or  information
               required and an explanation of why it is necessary.

               (c) an explanation of the Plan`s claim review procedure.

          6.3 Review of Claim.  Any person  whose  claim or request is denied or
who has not received a response  within  thirty (30) days may request  review by
notice given in writing to the Committee. The claim or request shall be reviewed
by the  Committee  who may,  but shall not be required  to, grant the claimant a
hearing.  On review,  the claimant may have  representation,  examine  pertinent
documents, and submit issues and comments in writing.

          6.4 Final  Decision.  The  decision on review  shall  normally be made
within  sixty (60) days.  If an  extension  of time is required for a hearing or
other special  circumstances,  the claimant shall be notified and the time limit
shall be one hundred  twenty (120) days.  The


                                       6


<PAGE>


decision  shall be in writing and shall state the reason and the  relevant  plan
provisions.  All  decisions  on  review  shall  be final  and  bind all  parties
concerned.

     7. Amendment or Termination

          7.1  Amendment of Plan. A majority of the Board of Directors may amend
this Plan at any time or from time to time.  However,  no such  amendment  shall
adversely  affect the benefits of the  Participant  which have accrued  prior to
such action.

          7.2 Plan Termination.

               (a) Partial  Termination.  The Board may partially  terminate the
               Plan by freezing  future  accruals if, in its judgment,  the tax,
               accounting,  or other effects of the  continuance of the Plan, or
               potential payments thereunder, would not be in the best interests
               of the Employer.

               (b) Complete  Termination.  Subject to the  requirements  of Code
               Section 409A, in the event of complete  termination  of the Plan,
               the Plan shall cease to operate and the Employer shall pay out to
               the  Participant his benefit as if the Participant had terminated
               employment as of the effective date of the complete  termination.
               Such complete termination of the Agreement shall occur only under
               the following circumstances and conditions:

                    (i) The  Administrator  may  terminate  the Plan  within  12
                    months of a corporate  dissolution  taxed under Code Section
                    331, or with approval of a bankruptcy  court  pursuant to 11
                    U.S.C.  ss.503(b)(1)(A),  provided that the amounts deferred
                    under  the  Plan are  included  in the  Participant's  gross
                    income in the latest of (i) the  calendar  year in which the
                    Plan terminates;  (ii) the calendar year in which the amount
                    is no longer subject to a substantial risk of forfeiture; or
                    (iii)  the  first  calendar  year in which  the  payment  is
                    administratively practicable.

                    (ii) The Board may  terminate the Plan by Board action taken
                    within the 30 days  preceding  a Change in Control  (but not
                    following a Change in Control), provided that the Plan shall
                    only be treated as terminated if all  substantially  similar
                    arrangements  sponsored by the Employer  are  terminated  so
                    that   the   Participant   and   all   participants    under
                    substantially  similar  arrangements are required to receive
                    all amounts of  compensation  deferred  under the terminated
                    arrangements within 12 months of the date of the termination
                    of the arrangements. For these purposes, "Change in Control"
                    shall be defined in accordance with the Treasury Regulations
                    under Code Section 409A.


                                       7


<PAGE>


                    (iii) The Board may terminate the Plan provided that (A) the
                    termination  and  liquidation  does not occur proximate to a
                    downturn in the financial health of the Bank or Company, (B)
                    all  arrangements  sponsored  by  the  Bank  that  would  be
                    aggregated with this Plan under Treasury Regulations Section
                    1.409A-1(c) if the Participant covered by this Plan was also
                    covered  by  any  of  those  other   arrangements  are  also
                    terminated;  (C) no payments  other than payments that would
                    be  payable  under  the  terms  of  the  arrangement  if the
                    termination  had not  occurred  are made within 12 months of
                    the  termination  of the  arrangement;  (D) all payments are
                    made   within   24  months   of  the   termination   of  the
                    arrangements;  and  (E)  the  Bank  does  not  adopt  a  new
                    arrangement  that would be  aggregated  with any  terminated
                    arrangement under Treasury  Regulations  Section 1.409A-1(c)
                    if the Participant participated in both arrangements, at any
                    time within three years following the date of termination of
                    the arrangement.

     8. Miscellaneous

          8.1  Unfunded  Plan.  This Plan is  intended  to be an  unfunded  plan
maintained  primarily  to provide  deferred  compensation  benefits for a select
group of management or highly compensated  employees.  However, the Employer may
elect to fund for the  benefits  of  Participants  as  described  in Section 8.3
below.  This Plan will  continue to be unfunded  for tax purposes and Title I of
ERISA even if benefits are funded by the Bank under Section 8.3 below.

          8.2 Unsecured General Creditor. The Participant and his Beneficiaries,
heirs,  successors and assigns shall have no legal or equitable rights, interest
or  claims  in any  property  or  assets  of the  Employer,  nor  shall  they be
beneficiaries of, or have any rights,  claims or interests in any life insurance
policies,  annuity  contracts  or the proceeds  therefrom  owned or which may be
acquired by the Employer.  Such  policies or other assets of the Employer  shall
not  be  held  under  any  trust  for  the   benefit  of   Participants,   their
Beneficiaries,  heirs,  successors or assigns,  or held in any way as collateral
security for the fulfilling of the  obligations of Employer under this Plan. Any
and all of the Employer`s assets shall be, and remain,  the general,  unpledged,
unrestricted  assets of the Employer.  The Employer`s  obligation under the Plan
shall be that of an unfunded and unsecured  promise of the Employer to pay money
in the future.

          8.3 Trust Fund. The Employer  shall be responsible  for the payment of
all  benefits  provided  under the Plan.  At its  discretion,  the  Employer may
establish  one (1) or more rabbi  trusts,  with such  trustees  as the Board may
approve,  for the purpose of providing for payment of such benefits.  Such trust
or trusts may be  irrevocable,  but the assets  thereof  shall be subject to the
claims of the Employer`s  creditors.  To the extent any benefits  provided under
the Plan are actually paid from any such rabbi trust, the Employer shall have no
further  obligation  with respect  thereto,  but to the extent not so paid, such
benefits shall remain the obligation of, and shall be paid by, the Employer.


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<PAGE>


          8.4  Nonassignability.  Neither the  Participant  nor any other person
shall have any right to commute,  sell, assign,  transfer,  pledge,  anticipate,
mortgage or otherwise  encumber,  transfer,  hypothecate or convey in advance of
actual  receipt the amounts,  if any,  payable  hereunder,  or any part thereof,
which are, and all rights to which are,  expressly  declared to be  unassignable
and  nontransferable.  No part of the  amounts  payable  shall,  prior to actual
payment,  be subject to seizure or  sequestration  for the payment of any debts,
judgments,  alimony or separate  maintenance  owed by a Participant or any other
person,  nor be transferable by operation of law in the event of a Participant`s
or any other person`s bankruptcy or insolvency.

          8.5  Expenses  of Plan.  All  expenses of the Plan will be paid by the
Employer.

          8.6  Payment  of   Employment   and  Code  Section  409A  Taxes.   Any
distribution  under  this  Plan  shall be  reduced  by the  amount  of any taxes
required  to be  withheld  from such  distribution.  This Plan shall  permit the
acceleration  of the time or  schedule  of a payment to pay  employment  related
taxes as permitted under Treasury  Regulation Section  1.409A-3(j) or to pay any
taxes  that may become  due at any time that the  arrangement  fails to meet the
requirements  of Code  Section  409A  and the  regulations  and  other  guidance
promulgated  thereunder.  In the latter case, such payments shall not exceed the
amount  required to be included in income as the result of the failure to comply
with the requirements of Code Section 409A.

          8.7 Acceleration of Payments.  Except as specifically permitted herein
or in other  sections of this Plan, no  acceleration  of the time or schedule of
any payment may be made hereunder.  Notwithstanding the foregoing,  payments may
be  accelerated  hereunder by the Bank,  in  accordance  with the  provisions of
Treasury Regulation Section 1.409A-3(j)(4) and any subsequent guidance issued by
the United States Treasury Department. Accordingly, payments may be accelerated,
in accordance with  requirements and conditions of the Treasury  Regulations (or
subsequent guidance) in the following circumstances:  (i) as a result of certain
domestic  relations  orders;  (ii) in compliance with ethics agreements with the
Federal  government;  (iii) in  compliance  with  ethics  laws or  conflicts  of
interest laws;  (iv) in limited  cash-outs (but not in excess of the limit under
Code Section  402(g)(1)(B));  (v) to apply certain  offsets in satisfaction of a
debt of the  Participant to the Bank;  (vi) in satisfaction of certain bona fide
disputes  between the  Participant  and the Bank; or (vii) for any other purpose
set forth in the Treasury Regulations and subsequent guidance.

          8.8  Participation by Subsidiaries and Affiliates.  If any employer is
now or hereafter becomes a subsidiary or affiliated  company of the Employer and
its employees participate in the ESOP, the Board of Directors may authorize such
subsidiary or affiliated  company to participate  in this Plan upon  appropriate
action by such employer necessary to adopt the Plan.

          8.9 Delivery of Elections to Committee.  All  elections,  designation,
requests,  notices,  instructions and other communications required or permitted
under the Plan from the Employer, a Participant,  Beneficiary or other person to
the Committee shall be on the appropriate  form,  shall be mailed by first-class
mail or delivered to such address as shall be specified by such  Committee,  and
shall be deemed to have been given or delivered only upon actual receipt thereof
by such Committee at such location.


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<PAGE>


          8.10  Delivery of Notice to  Participants.  All  notices,  statements,
reports and other  communications  required or permitted under the Plan from the
Employer or the  Committee to any  Officer,  Participant,  Beneficiary  or other
person,  shall be  deemed to have been duly  given  when  delivered  to, or when
mailed by first-class  mail,  postage  prepaid,  and addressed to such person at
this address last appearing on the records of the Committee.

     9. Construction of the Plan

          9.1  Construction  of the Plan.  The  provisions of this Plan shall be
construed,  regulated,  and  administered  according to the laws of the State of
Hawaii, to the extent not superseded by Federal law.

          9.2  Counterparts.  This Plan has been  established by the Employer in
accordance  with the  resolutions  adopted by the Board of Directors  and may be
executed in any number of  counterparts,  each of which shall be deemed to be an
original.  All the counterparts  shall  constitute one instrument,  which may be
sufficiently evidenced by any one counterpart.

          9.3 Validity. In case any provision of this Plan shall be held illegal
or invalid for any reason,  said  illegality or invalidity  shall not affect the
remaining parts hereof, but this Plan shall be construed and enforced as if such
illegal or invalid provision had never been inserted herein.

                            [signature page follows]


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<PAGE>


     IN WITNESS WHEREOF, the Bank has adopted this Plan, effective as of January
1, 2009.


                                       TERRITORIAL SAVINGS BANK




November 13, 2009                  By: /s/ Harold H. Ohama
-----------------                      ----------------------------------------
Date                                   Chairman of the Compensation Committee


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                            TERRITORIAL SAVINGS BANK
                            NONQUALIFIED SUPPLEMENTAL
                          EMPLOYEE STOCK OWNERSHIP PLAN


                                    Exhibit A
                                    ---------


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Name of Participant                    Date of Participation
-------------------------------------- ----------------------------------------
Allan S. Kitagawa                      January 1, 2009
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Vernon Hirata                          January 1, 2009
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Ralph Nakatsuka                        January 1, 2009
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