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                                                                   Exhibit 10.12

                             SPLIT-DOLLAR AGREEMENT


         This Agreement by and between Mark J. Terry (the "Employee") and WARREN
FIVE CENTS SAVINGS BANK (the "Bank") shall be effective as of January 2, 1998.

         WHEREAS, the Employee is employed by the Bank; and

         WHEREAS, the Employee wishes to provide life insurance protection for
his family in the event of his death, under a policy of life insurance insuring
his life (the "Policy"), which is described in Exhibit A attached hereto and by
this reference made a part hereof, and which is being issued by the issuer
listed in Exhibit A (the "Insurer"); and

         WHEREAS, the Bank is willing to pay the premiums due on the Policy as
an additional employment benefit for the Employee, on the terms and conditions
hereinafter set forth;

         WHEREAS, the Employee is the owner of the Policy and, as such,
possesses all incidents of ownership in and to the Policy; and

         WHEREAS, the Bank wishes to have the Policy collaterally assigned to it
by the Employee, in order to secure the repayment of the amounts which it will
pay toward the premiums on the Policy;

         NOW, THEREFORE, in consideration of the premises and of the mutual
promises contained herein, the parties hereto agree as follows:

         1.       Purchase of Policy.

         The Employee will contemporaneously purchase the Policy from the
Insurer; such policy to provide a death benefit to the Employee equal to three
times the Employee's base salary (as in effect on the Effective Date and as
subsequently adjusted) until the Employee attains age 55 and then a death
benefit equal to $100,000 at all times thereafter. Both parties hereto agree
that they will take all necessary action to cause the Insurer to issue the
Policy and shall take any further action which may be necessary to cause the
Policy to conform to the provisions of this Agreement. Both parties hereto agree
that the Policy shall be subject to the terms and conditions of this Agreement
and of the collateral assignment filed with the Insurer relating to the Policy.

         2.       Ownership of Policy.

         The Employee (or Employee's donee, if applicable) shall be the sole and
absolute owner of the Policy; the Employee may exercise all ownership rights
granted to the owner thereof by the terms of the Policy, except as may be
otherwise provided herein.


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         3.       Payment of Premiums.

         So long as the Employee is an employee of the Bank, before the end of
any grace period provided in the Policy for each premium payment, the Bank shall
pay or cause to be paid the full amount of the premium to the Insurer, and
shall, upon request, promptly furnish the Employee evidence of timely payment of
such premium. The Bank shall annually furnish to the Employee a statement of the
amount of income reportable by the Employee for federal and state income tax
purposes, as a result of its payment of such premium.

         4.       Application of Dividends.

         Any dividend declared on the Policy, if any, shall be applied to
purchase paid-up additional insurance on the life of the Employee. The parties
hereto agree that the dividend election provisions of the Policy shall conform
to the provisions hereof.

         5.       Collateral Assignment.

         To secure the repayment to the Bank of an amount equal to the aggregate
amount of its premium payments under the Policy, the Employee has
contemporaneously with the execution of this Agreement assigned the Policy to
the Bank as collateral, by means of the form used by the Insurer for such
assignments. The collateral assignment of the Policy to the Bank hereunder shall
not be terminated, altered or amended by the Employee without the express
written consent of the Bank. Both parties hereby agree to take all action
necessary to cause such collateral assignment to conform to the provisions of
this Agreement.

         6.       Transfer of Policy.

         (a)      Except as provided in subsection (b) below and as otherwise
provided herein, neither the Employee nor any donee of the Employee's, without
the express written consent of the Bank, shall sell, assign, transfer, borrow
against, surrender or cancel the Policy, change the beneficiary designation
provision thereof, or terminate the dividend election thereof.

         (b)      The Employee shall have the right to absolutely and
irrevocably give to a donee, all of his right, title and interest in and to the
Policy, subject to the collateral assignment of the Policy to the Bank pursuant
hereto. The Employee may exercise this right by executing a written transfer of
ownership in the form used by the Insurer for irrevocable gifts of insurance
policies, and delivering this form to the Bank. Upon receipt of such form,
executed by the Employee and duly accepted by the donee thereof, the Bank shall
consent thereto in writing, and shall thereafter treat the Employee's donee as
the sole owner of all of the Employee's right, title and interest in and to the
Policy, subject to the Bank pursuant hereto. Thereafter, the Employee shall have
no right, title or interest in and to the Policy, all such rights being vested
in and exercisable only by such donee.


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         7.       Payment of Benefit.

         Upon the death of the Employee, the Bank shall have the unqualified
right to receive a portion of the death benefit equal to the aggregate amount of
its premium payments under the Policy, reduced by any outstanding indebtedness
to the Insurer which was incurred by the Bank and secured by the Policy,
including any interest due on such indebtedness. The balance of the death
benefit provided under the Policy, if any, shall be distributed to the
designated beneficiary or the beneficiaries. In no event shall the amount
payable to the Bank hereunder exceed the Policy proceeds payable at the death of
the Employee. No amount shall be paid from such death benefit to the designated
beneficiary or beneficiaries until the full amount due the Bank hereunder has
been paid. Both parties hereto agree that the beneficiary designation provision
of the Policy shall conform to the provisions hereof.

         8.       Payment of Cash Surrender Value.

         Upon the expiration or termination of the Policy prior to the death of
the Employee, the Bank shall have the unqualified right to receive a portion of
the cash surrender value of the Policy equal to the aggregate amount of its
premium payments under the Policy, reduced by any outstanding indebtedness to
the Insurer which was incurred by the Bank and secured by the Policy, including
any interest due on such indebtedness. The balance of the Policy's cash
surrender value, if any, shall be distributed to the Employee or the Employee's
donee, if applicable. In no event shall the amount payable to the Bank hereunder
exceed the Policy's cash surrender value. No amount shall be paid to the
Employee or the Employee's donee, if applicable, until the full amount due the
Bank hereunder has been paid. Both parties hereto agree that the Policy shall
conform to the provisions hereof.

         9.       Termination of Agreement.

         (a)      This Agreement shall terminate without notice upon the
occurrence of any of the following events: (I) the total cessation of the
business of the Bank or (ii) the bankruptcy, receivership or dissolution of the
Bank.

         (b)      In addition, the Employee (or the Employee's donee, if
applicable) may terminate this Agreement, while no premium under this Policy is
overdue, by written notice to the other parties hereto. Such termination shall
be effective as of the date of such notice.

         (c)      Upon the termination of the Agreement, the Bank shall have the
unqualified right to receive a portion of the cash surrender value of the Policy
equal to the aggregate amount of its premium payments under the Policy, reduced
by any outstanding indebtedness to the Insurer which was incurred by the Bank
and secured by the Policy, including any interest due on such indebtedness.


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         10.      Release of Collateral Assignment at Termination.

         Within thirty days after the date of the termination of his employment
with the Bank, the Employee (or the Employee's donee, if applicable) shall pay
to the Bank an amount in cash equal to the aggregate amount of premiums paid
under the Policy by the Bank to date rediced by any, less any outstanding
indebtedness to the Insurer secured by the Policy which was incurred by the Bank
and remains outstanding as of the date of such termination (including any
interest then due with respect to such indebtedness). Upon receipt of such
amount, the Bank shall release the collateral assignment of the Policy by the
execution and delivery of any appropriate instrument of release.

         11.      Insurer Not a Party.

         Subject to the terms and conditions of the Policy, the Insurer shall be
fully discharged form its obligations under the Policy by payment of the Policy
death benefit to the beneficiary or beneficiaries named in the Policy, subject
to the terms and conditions of the Policy. In no event shall the insurer by
considered a party to this Agreement, or any modification or amendment hereof.
No provisions of this Agreement nor or any modification or amendment hereof
shall in any way be construed as enlarging, changing, varying or in any other
way affecting the obligations of the Insurer as expressly provided in the
Policy, except insofar as the provisions hereof are made a part of the Policy by
the collateral assignment executed by the Employee and filed with the Insurer in
connection herewith.

         12.      Administration. 

         The Bank shall make all determinations concerning rights to benefits
under this Agreement. Any decision by the Bank denying a claim by the Employee,
his donee or his beneficiary, for benefits under this Agreement shall be stated
in writing and delivered or mailed to the Employee or such donee or beneficiary.
Such decision shall set forth the specific reasons for the denial, written to
the best of the Bank's ability in a manner that may be understood without legal
or actuarial counsel.

         13.      Notices.

         Any notice required or permitted to be given hereunder shall be
effective when received and shall be sufficient if in writing and if personally
delivered or sent by prepaid cable, telex or registered air mail, return receipt
requested, to the party to receive such notice at this address set forth at the
end of this Agreement or at such other address as a party may be notice specify
to the other.

         14.      Miscellaneous.

         To be effective, each modification or amendment to this Agreement must
be in writing and signed by both parties hereto. No waiver shall be valid unless
in writing and signed by the waiving party. No inaction shall constitute a
waiver. Any waiver shall be effective only with respect to past events and shall
not constitute a continuing or prospective waiver unless expressly so stated in
writing. This Agreement shall be governed by the laws of the Commonwealth of


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Massachusetts as the forum for any litigation between the parties with respect
to this Agreement. If any provision or provisions of this Agreement is, or
hereafter is adjudged to be, for any reason unenforceable or invalid, it is the
specific intent of the parties that the remainder hereof shall subsist and be
binding upon each of the parties hereto. This Agreement shall bind and inure to
the benefit of the respective assigns, heirs, successors and legal
representatives of each of the parties hereto. The headings and captions of this
Agreement are for the purpose of reference only and shall not limit or defined
any meaning thereof.

         IN WITNESS WHEREOF, the parties hereto have executed this Agreement, in
duplicate, as of the day and year first above written.


WARREN FIVE CENTS SAVINGS BANK              EMPLOYEE



By: ____________________________           ____________________________

  Title:________________________


________________________________           ____________________________
Attest                                     Witness


(SEAL)


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                                    EXHIBIT A


         The following life insurance policy is subject to the foregoing
Split-Dollar Agreement:


Insurer:  Royal Maccabees Life Insurance Company

Insured:

Policy Number:

Face Amount:

Dividend Option:

Date of Issue:


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