EX-10.3


    Exhibit
      10.3

    


    


    


    
 

    


    


    RESTATED

    DIRECTOR
      SUPPLEMENTAL RETIREMENT

    INCOME
      and DEFERRED COMPENSATION AGREEMENT

    FOR
      ELIZABETH HANCE

    


    MAGYAR
      BANK

    New
      Brunswick, New Jersey

    


    January
      1, 2006

    


    


    


    
 

    


    


    


    Financial
      Institution Consulting Corporation

    700
      Colonial Road, Suite 102

    Memphis,
      Tennessee 38117

    WATS:
      1-800-873-0089

    FAX:
      (901) 684-7414

    (901)
      684-7400


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    



    RESTATED

    DIRECTOR
      SUPPLEMENTAL RETIREMENT

    INCOME
      and DEFERRED COMPENSATION AGREEMENT

    FOR
      ELIZABETH HANCE

     

    


    This
      Restated Director Supplemental Retirement Income and Deferred Compensation
      Agreement for Elizabeth Hance (the "Agreement"), effective as of the 1st day
      of
      January, 2006, amends and restates the Director Supplemental Retirement Income
      and Deferred Compensation Agreement for Elizabeth Hance dated February 1, 2004,
      and formalizes the understanding by and between MAGYAR BANK (the "Bank"), a
      state chartered savings bank having its principal place of business in New
      Brunswick, New Jersey, and ELIZABETH HANCE (hereinafter referred to as
      "Director"). All prior non-qualified Director deferred compensation agreements,
      including any and all Joinder Agreements, with respect to the Director and
      MAGYAR BANK, are hereby superseded and replaced by this Agreement

    


    W
      I T N E S S E T H :

    


    WHEREAS,
      the
      Director serves the Bank as a member of the board; and 

    


    WHEREAS,
      the
      Bank recognizes the valuable services heretofore performed by the Director
      and
      wishes to encourage his continued service; and

    


    WHEREAS,
      the
      Director wishes to be assured that the Director will be entitled to a certain
      amount of additional compensation for some definite period of time from and
      after retirement from active service with the Bank or other termination of
      service and wishes to provide his beneficiary with benefits from and after
      death; and 

     

    WHEREAS,
      the
      Bank and the Director wish to provide the terms and conditions upon which the
      Bank shall pay such additional compensation to the Director after retirement
      or
      other termination of service and/or death benefits to his beneficiary after
      death; and 

    


    WHEREAS,
      the
      Bank has adopted this Director Supplemental Retirement Income and Deferred
      Compensation Agreement which controls all issues relating to benefits as
      described herein; and

     

    

      
        
          
          

        

        
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    WHEREAS,
      Section
      409A of the Internal Revenue Code of 1986 (“Code”), as amended, requires that
      certain deferred compensation arrangements comply with its terms or subject
      the
      recipient of the compensation to potential taxes and penalties; and

     

    WHEREAS,
      the
      Bank desires to amend and restate the Agreement to comply with Code Section
      409A
      and any Treasury Regulations promulgated thereunder; and

     

    WHEREAS,
      the
      Board of Directors of the Bank has conditionally approved the
      amendment and restatement of the Agreement, subject to the approval of the
      New
      Jersey Department of Banking and Insurance.

    


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

    


    SECTION
      I

    DEFINITIONS

    


    When
      used
      herein, the following words and phrases shall have the meanings below unless
      the
      context clearly indicates otherwise:

    


    
      	
              1.1

            	
              "Accrued
                Benefit Account" shall be represented
                by
                the bookkeeping entries required to record the Director=s
                (i) Phantom Contributions plus (ii) accrued interest, equal to the
                Interest Factor, earned to-date on such amounts. However, neither
                the
                existence of such bookkeeping entries nor the Accrued Benefit Account
                itself shall be deemed to create either a trust of any kind, or a
                fiduciary relationship between the Bank and the Director or any
                Beneficiary. 

            


    

    


    
      	
              1.2

            	
              "Act"
                means the Employee Retirement Income Security Act of 1974, as amended
                from
                time to time.

            


    

    


    
      	
              1.3

            	
              AAdministrator@
                means the Bank.

            


    

    


    
      	
              1.4

            	
              "Bank"
                means MAGYAR BANK and any successor
                thereto.

            


    


    
      
        
        

      

      
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              1.5

            	
              "Beneficiary"
                means the person or persons (and their heirs) designated as Beneficiary
                in
                Exhibit B of this Agreement to whom the deceased Director=s
                benefits are payable. If no Beneficiary is so designated, then the
                Director=s
                Spouse, if living, will be deemed the Beneficiary. If the
                Director=s
                Spouse is not living, then the Children of the Director will be deemed
                the
                Beneficiaries and will take on a per stirpes basis. If there are
                no
                Children, then the Estate of the Director will be deemed the
                Beneficiary.

            


    

    


    
      	
              1.6

            	
              "Benefit
                Age" means the later of: (i) the Director's sixty-fifth (65th) birthday
                or
                (ii) the actual date the Director=s
                full-time service with the Bank terminates.


            


    

    


    
      	
              1.7

            	
              "Benefit
                Eligibility Date" means the date on which the Director is entitled
                to
                receive any benefit(s) pursuant to Section(s) III or V of this Agreement.
                It shall be the first day of the month following both the attainment
                of
                the Directors’ Benefit Age and his actual retirement from the Board of
                Directors. 

            


    

    


    
      	
              1.8

            	
              "Board
                of Directors" means the board of directors of the
                Bank.

            


    

    


    
      	
              1.9

            	
              "Cause"
                means termination of the Director=s
                service on the Board of Directors due to: (i) actions or inactions
                which
                constitute a breach of the bylaws of the Bank or (ii) the
                Director=s
                personal dishonesty, willful misconduct, willful malfeasance, breach
                of
                fiduciary duty involving personal profit, intentional failure to
                perform
                stated duties, willful violation of any law, rule, regulation (other
                than
                traffic violations or similar offenses), or final cease-and-desist
                order,
                material breach of any provision of this Plan, or gross negligence
                in
                matters of material importance to the
                Bank.

            


    

     

    
      	
              1.10
                

            	
              “Change
                in Control” shall mean a change in the ownership of the Bank or Company
                under paragraph (a) below, a change in effective control of the Bank
                or
                Company under paragraph (b) below, or a change in the ownership of
                a
                substantial portion of the assets of the Bank or Company under paragraph
                (c) below. For all purposes hereunder, the definition of Change in
                Control
                shall be construed to be consistent with the requirements of Proposed
                Treasury Regulation Section 1.409A-3(g), except to the extent that
                such
                proposed regulations are superseded by subsequent
                guidance.

            


    


    
      
        
        

      

      
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    For
      this
      subsection “persons acting as a group” is defined as follows; Persons will be
      considered to be acting as a group if they are owners of a corporation that
      enters into a merger, consolidation, purchase or acquisition of stock, or
      similar business transaction with the corporation. Persons will not be
      considered to be acting as a group solely because they purchase or own stock
      of
      the same corporation at the same time, or as a result of the same public
      offering. If a person, including an entity, owns stock in both corporations
      that
      enter into a merger, consolidation, purchase or acquisition of stock, or similar
      transaction, such shareholder is considered to be acting as a group with other
      shareholders in a corporation only with respect to the ownership in that
      corporation prior to the transaction giving rise to the change and not with
      respect to the ownership interest in the other corporation. 

     

    
      	 	
              (a)

            	
              Change
                in Ownership of the Bank or Company

            


    

     

    Change
      in
      the ownership occurs on the date that any one person, or more than one person
      acting as a group (as defined above), acquires ownership of stock of the Bank
      or
      Company that, together with stock held by such person or group, constitutes
      more
      than 50 percent of the total fair market value or total voting power of the
      stock of such corporation. However, if any one person or more than one person
      acting as a group, is considered to own more than 50 percent of the total fair
      market value or total voting power of the stock of a corporation, the
      acquisition of additional stock by the same person or persons is not considered
      to cause a change in the ownership of the corporation or to cause a change
      in
      the effective control of the corporation. 

    


    
      	 	
              (b)

            	
              Change
                in the Effective Control of the Bank or
                Company

            


    

     

    A
      change
      in the effective control of the Bank or Company occurs on the date that either
      -

     

    (1)
      Any
      one person, or more than one person acting as a group (as defined above),
      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
      Company possessing 20 percent or more of the total voting power of the stock
      of
      the Company (except that if an individual Director’s agreement becomes subject
      to Code Section 409A, then the required percentage of acquired ownership of
      stock under this Subsection 1.10 (b)(1) shall be 35 percent or more); or



    
      
        
        

      

      
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    (2)
      a
      majority of members of the Company’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 Company’s board of directors prior to the date of
      the appointment or election. 

     

    
      	 	
              (c)

            	
              Change
                in the Ownership of a Substantial Portion of the Bank’s or Company’s
                Assets.

            


    

     

    Change
      in
      the ownership of a substantial portion of the Bank or Company’s assets occurs on
      the date that any one person, or more than one person acting as a group (as
      defined above), 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 corporation that have a total gross fair market value equal to or more
      than
      40 percent of the total gross fair market value of all of the assets of the
      Bank
      or Company immediately prior to such acquisition or acquisitions. For this
      purpose, gross fair market value means the value of the assets of the Bank
      or
      Company, or the value of the assets being disposed of, determined without regard
      to any liabilities associated with such assets. 

    


    
      	
              1.11

            	
              "Children"
                means all natural or adopted children of the Director and issue of
                any
                predeceased child or children.

            


    

    


    
      	
              1.12

            	
              "Code"
                means the Internal Revenue Code of 1986, as amended from time to
                time.

            


    

    


    
      	
              1.13

            	
              “Company”
                shall mean Magyar Bancorp, Inc.

            


    

    


    
      	
              1.14

            	
              "Contribution(s)"
                means those annual total contributions comprised of both the Elective
                Contributions and the Emeritus Contributions which the Bank is required
                to
                make to the Retirement Income Trust Fund on behalf of the Director
                in
                accordance with Subsection 2.1(a) and in the amounts set forth in
                Exhibit
                A of the Agreement. Such Contributions, for the first Plan Year,
                shall
                include any and all amounts accrued by the Bank to pay the benefits
                promised to the Director under any prior non-qualified deferred
                compensation agreements including any Joinder Agreements previously
                executed by the Bank and the Director.


            


    


    
      
        
        

      

      
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              1.15

            	
              (a)
                "Disability Benefit" means the benefit payable to the Director following
                a
                determination, in accordance with Subsection 6.1(a), that he is no
                longer
                able, properly and satisfactorily, to perform his duties at the
                Bank.

            


    

    


    (b)
      "Disability Benefit-Supplemental" (if applicable) means the benefit payable
      to
      the Director=s
      Beneficiary upon the Director=s
      death
      in accordance with Subsection 6.1(b). 

    


    
      	
              1.16

            	
              "Effective
                Date" of this Agreement shall be January 1, 2006. The original effective
                date of this Agreement was February 1, 2004. The Agreement is hereby
                amended and restated effective January 1, 2006 in order to conform
                to Code
                Section 409A.

            


    

    


    
      	
              1.17

            	
              “Elective
                Contribution” shall refer to the Director’s voluntary monthly pre-tax
                deferral of board fees, committee fees and/or retainer plus interest
                compounded annually at a rate equal to the Interest Factor. The Director
                may elect to change his voluntary deferral amount by submitting to
                the
                Bank a Notice of Adjustment of Elective Contribution thirty (30)
                days
                prior to the end of any Plan Year.

            


    

    


    
      	
              1.18

            	
              “Emeritus
                Contribution” shall refer to the amounts necessary to support an annual
                amount payable to the Director at Benefit Age based upon a percentage,
                as
                stated in Appendix A, of the Director’s total board fees, committee fees
                and/or retainer in the twelve months prior to the Director’s Benefit
                Eligibility Date. The percentage shall be determined by the following
                formula: ten percent (10%) plus two and one-half percent (2 1⁄2%) for each
                year of service as a Director, with a minimum of fifty percent (50%),
                provided the Director has served for at least five (5) years, and
                a
                maximum of sixty percent (60%). Notwithstanding the foregoing, any
                Director who serves as Board Chairman for a five-year term (other
                than the
                current Chairman) shall be entitled to receive seventy-five percent
                (75%).

            


    

    


    
      	
              1.19

            	
              "Estate"
                means the estate of the Director.

            


    

    


    
      	
              1.20

            	
              "Interest
                Factor" means monthly compounding, discounting or annuitizing, as
                applicable, at a rate set forth in
                Exhibit A.

            


    


    
      
        
        

      

      
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              1.21

            	
              "Payout
                Period" means the time frame during which certain benefits payable
                hereunder shall be distributed. Payments shall be made in monthly
                installments commencing on the first day of the month following the
                occurrence of the event which triggers distribution and continuing
                for a
                period of one hundred eighty (180) months. Should the Director make
                a
                Timely Election to receive a lump sum benefit payment, the
                Director=s
                Payout Period shall be deemed to be one (1) month.
                

            


    

    


    
      	
              1.22

            	
              "Phantom
                Contributions" means those annual Contributions which the Bank is
                no
                longer required to make on behalf of the Director to the Retirement
                Income
                Trust Fund. Rather, once the Director has exercised the withdrawal
                rights
                provided for in Subsection 2.2, the Bank shall be required to record
                the
                annual amounts set forth in Exhibit A of the Agreement in the
                Director=s
                Accrued Benefit Account, pursuant to Subsection 2.1.
                

            


    

    


    
      	
              1.23

            	
              "Plan
                Year" shall mean the twelve (12) month period commencing January
                1 and
                ending December 31.

            


    

    


    
      	
              1.24

            	
              "Retirement
                Income Trust Fund" means the trust fund account established by the
                Director and into which annual Contributions will be made by the
                Bank on
                behalf of the Director pursuant to Subsection 2.1. The contractual
                rights
                of the Bank and the Director with respect to the Retirement Income
                Trust
                Fund shall be outlined in a separate writing to be known as the Elizabeth
                Hance Grantor Trust agreement. 

            


    

    


    
      	
              1.25

            	
              ASpouse@
                means the individual to whom the Director is legally married at the
                time
                of the Director=s
                death, provided, however, that the term ASpouse@
                shall not refer to an individual to whom the Director is legally
                married
                at the time of death if the Director and such individual have entered
                into
                a formal separation agreement or initiated divorce
                proceedings.

            


    

    


    
      	
              1.26

            	
              "Supplemental
                Retirement Income Benefit" means an annual amount (before
                taking into account federal and state income taxes), payable in monthly
                installments throughout the Payout Period. Such benefit is projected
                pursuant to the Agreement for the purpose of determining the Contributions
                to be made to the Retirement Income Trust Fund (or Phantom Contributions
                to be recorded in the Accrued Benefit Account). The annual Contributions
                and Phantom 

            


    


    
      
        
        

      

      
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    Contributions
      have been actuarially determined, using the assumptions set forth in Exhibit
      A,
      in order to fund for the projected Supplemental Retirement Income Benefit.
      The
      Supplemental Retirement Income Benefit for which Contributions (or Phantom
      Contributions) are being made (or recorded) is set forth in Exhibit A.


    


    
      	
              1.27

            	
              "Timely
                Election" means the Director has made an election to change the form
                of
                his benefit payment(s) from the Retirement Income Trust Fund by filing
                with the Administrator a Notice of Election to Change Form of Payment
                (Exhibit C of this Agreement). In the case of benefits payable from
                the
                Retirement Income Trust Fund, such election may be made at any time.
                In
                the case of benefits payable from the Accrued Benefit Account, such
                election generally shall have been made prior to December 31, 2006
                (i.e.
                the last day of the “Transition Period” for bringing plans into compliance
                with Code Section 409A). Unless the Transition Period is extended
                by the
                Internal Revenue Service, if the Director makes an election subsequent
                to
                December 31, 2006 with respect to distributions from the Accrued
                Benefit
                Account, then (i) such election may not take effect until at least
                twelve
                (12) months after the date on which the election is made, (ii) in
                the case
                of an election related to a payment other than due to disability
                or death,
                the first payment with respect to which such election is made must
                be
                deferred for a period of not less than five (5) years from the date
                such
                payment would otherwise have been made, and (iii) any election related
                to
                a distribution at a specified time or pursuant to a fixed schedule
                may not
                be made less than twelve (12) months prior to the date of the first
                scheduled payment.

            


    

    


    SECTION
      II

    BENEFIT
      FUNDING

    


    2.1          
      (a)
      Retirement
      Income Trust Fund and Accrued Benefit Account. The
      Director shall establish the Elizabeth Hance Grantor Trust into which the Bank
      shall be required to make annual Contributions on the Director=s
      behalf,
      pursuant to Exhibit A and this Section II of the Agreement. A trustee shall
      be
      selected by the Director. The trustee shall maintain an account, separate and
      distinct from the Director=s
      personal contributions, which account shall constitute the Retirement Income
      Trust Fund. The trustee shall be charged with the responsibility of investing
      all contributed funds. Distributions from the Retirement Income Trust Fund
      of
      the Elizabeth Hance Grantor Trust may be made by the trustee to the Director,
      for purposes of payment of any 


    
      
        
        

      

      
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    income
      or
      employment taxes due and owing on Contributions by the Bank to the Retirement
      Income Trust Fund, if any, and on any taxable earnings associated with such
      Contributions which the Director shall be required to pay from year to year,
      under applicable law, prior to actual receipt of any benefit payments from
      the
      Retirement Income Trust Fund. If the Director exercises his withdrawal rights
      pursuant to Subsection 2.2, the Bank=s
      obligation to make Contributions to the Retirement Income Trust Fund shall
      cease
      and the Bank=s
      obligation to record Phantom Contributions in the Accrued Benefit Account shall
      immediately commence pursuant to Exhibit A and this Section II of the Agreement.
      To the extent this Agreement is inconsistent with the Elizabeth Hance Grantor
      Trust Agreement, the Elizabeth Hance Grantor Trust Agreement shall supersede
      this Agreement.

    


    The
      annual Contributions (or Phantom Contributions) required to be made by the
      Bank
      to the Retirement Income Trust Fund (or recorded by the Bank in the Accrued
      Benefit Account) have been actuarially determined and are set forth in Exhibit
      A
      which is attached hereto and incorporated herein by reference. Contributions
      shall be made by the Bank to the Retirement Income Trust Fund (i) within
      seventy-five (75) days of establishment of such trust, and (ii) within the
      first
      thirty (30) days of the beginning of each subsequent Plan Year, unless this
      Section expressly provides otherwise. Phantom Contributions, if any, shall
      be
      recorded in the Accrued Benefit Account within the first thirty (30) days of
      the
      beginning of each applicable Plan Year, unless this Section expressly provides
      otherwise. Phantom Contributions shall accrue interest at a rate equal to the
      Interest Factor, during the Payout Period, until the balance of the Accrued
      Benefit Account has been fully distributed. Interest on any Phantom Contribution
      shall not commence until such Payout Period commences.

    


    The
      Administrator shall review the schedule of annual Contributions (or Phantom
      Contributions) provided for in Exhibit A (i) within thirty (30) days prior
      to
      the close of each Plan Year and (ii) if the Director is employed by the Bank
      until attaining Benefit Age, on or immediately before attainment of such Benefit
      Age. Such review shall consist of an evaluation of the accuracy of all
      assumptions used to establish the schedule of Contributions (or Phantom
      Contributions). Provided that (i) the Director has not exercised his withdrawal
      rights pursuant to Subsection 2.2 and (ii) the investments contained in the
      Retirement Income Trust Fund have been deemed reasonable by the Bank, the
      Administrator shall prospectively amend or supplement the schedule



    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    


    


    of
      Contributions provided for in Exhibit A should the Administrator determine
      during any such review that an
      increase
      in or
supplement
      to
      the
      schedule of Contributions is necessary in order to adequately fund the
      Retirement Income Trust Fund so as to provide an annual benefit (or to provide
      the lump sum equivalent of such benefit, as applicable) equal to the
      Supplemental Retirement Income Benefit, on an after-tax basis, commencing at
      Benefit Age and payable for the duration of the Payout Period.

    


    (b)
      Withdrawal
      Rights Not Exercised. 

    (1)
      Contributions
      Made Annually

    If
      the
      Director does not exercise any withdrawal rights pursuant to Subsection 2.2,
      the
      annual Contributions to the Retirement Income Trust Fund shall continue each
      year, unless this Subsection 2.1(b) specifically states otherwise, until the
      earlier of (i) the last Plan Year that Contributions are required pursuant
      to
      Exhibit A, or (ii) the Plan Year of the Director's termination of
      service.

    


    (2)
      Termination
      Following a Change in Control

    If
      the
      Director does not exercise his withdrawal rights pursuant to Subsection 2.2
      and
      a Change in Control occurs at the Bank, followed within thirty-six (36) months
      by either (i) the Director's involuntary termination of service, or (ii)
      Director's voluntary termination of service after: (A) a material change in
      the
      Director's function, duties, or responsibilities, which change would cause
      the
      Director's position to become one of lesser responsibility, importance, or
      scope
      from the position the Director held at the time of the Change in Control, (B)
      a
      relocation of the Director's principal place of service by more than thirty
      (30)
      miles from its location prior to the Change in Control, or (C) a material
      reduction in the benefits and perquisites to the Director from those being
      provided at the time of the Change in Control, the Emeritus Contributions as
      set
      forth on Schedule A shall continue to be required of the Bank. The Bank shall
      be
      required to make an immediate lump sum Contribution to the Director's Retirement
      Income Trust Fund in an amount equal to: (i) the full Emeritus Contribution
      required for the Plan Year in which such termination occurs, if not yet made,
      plus (ii) the present value (computed using a discount rate equal to the
      Interest Factor) of all remaining Emeritus Contributions to the Retirement
      Income Trust Fund, and (iii) the present value (computed using the a discount
      rate equal to the Interest Factor) of the interest only component of the
      Elective Contribution; provided, however, that, if necessary, an



    
      
        
        

      

      
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    additional
      amount shall be contributed to the Retirement Income Trust Fund which is
      sufficient to provide the Director with after-tax benefits (assuming a constant
      tax rate equal to the rate in effect as of the date of Director=s
      termination) beginning at Benefit Age following such termination, equal in
      amount to that benefit which would have been payable to the Director if no
      secular trust had been implemented and the benefit obligation had been accrued
      under APB Opinion No. 12, as amended by FAS 106. 

    


    (3)
      Termination
      For Cause

    If
      the
      Director does not exercise his withdrawal rights pursuant to Subsection 2.2,
      and
      is terminated for Cause pursuant to Subsection 5.2, no further Contribution(s)
      to the Retirement Income Trust Fund shall be required of the Bank, and if not
      yet made, no Contribution shall be required for the Plan Year in which such
      termination for Cause occurs.

    


    (4)
      Voluntary or Involuntary Termination of Service.

    If
      the
      Director does not exercise his withdrawal rights pursuant to
      Subsection 2.2, and the Director's service with the Bank is voluntarily or
      involuntarily terminated for any reason, including a termination due to
      disability of the Director but excluding termination for Cause, or termination
      following a Change in Control within thirty-six (36) months of such Change
      in
      Control, no further Contribution(s), as defined in Subsection 1.14, to the
      Retirement Income Trust Fund shall be required of the Bank, and if not yet
      made,
      no Contribution shall be required for the Plan Year in which such termination
      occurs. Notwithstanding the above, the Bank will be required to make annual
      payments to Director’s Retirement Income Trust Fund determined as
      follows:

     

    
      	 	
              1.

            	
              Determine
                what the accrued liability would have been as of the Director’s date of
                termination, had no secular trust been
                implemented.

            


      	 	 	 


    

    
      	 	
              2.

            	
              Determine
                the benefit payable, beginning at the Benefit Age, for 180 months
                which
                that accrued liability would support had interest been added to that
                liability on an annual basis using the Accrued Benefit Interest Factor
                set
                forth in Exhibit A.

            


      	 	 	 


    

    
      	 	
              3.

            	
              The
                Bank shall make payments to the Director’s Retirement Income Trust Fund on
                an annual basis in amounts equal to the accrued interest expense
                which
                would have been recorded absent the secular trust
                arrangement.

            


    


    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    


    


    (5)
      Death
      During Service.

    If
      the
      Director does not exercise any withdrawal rights pursuant to
      Subsection 2.2, and dies while employed by the Bank, and if, following the
      Director=s
      death,
      the assets of the Retirement Income Trust Fund are insufficient to provide
      the
      Supplemental Retirement Income Benefit to which the Director is entitled, the
      Bank shall be required to make a Contribution to the Retirement Income Trust
      Fund equal to the sum of the remaining Contributions set forth on Exhibit A,
      after taking into consideration any payments under any life insurance policies
      that may have been obtained on the Director=s
      life by
      the Retirement Income Trust Fund. Such final contribution shall be payable
      in a
      lump sum to the Retirement Income Trust Fund within thirty (30) days of the
      Director=s
      death.

    


    (c)
      Withdrawal
      Rights Exercised. 

    (1)
      Phantom
      Contributions Made Annually.

    If
      the
      Director exercises his withdrawal rights pursuant to Subsection 2.2, no further
      Contributions to the Retirement Income Trust Fund shall be required of the
      Bank.
      Thereafter, Phantom Contributions shall be recorded annually in the Director's
      Accrued Benefit Account within thirty (30) days of the beginning of each Plan
      Year, commencing with the first Plan Year following the Plan Year in which
      the
      Director exercises his withdrawal rights. Such Phantom Contributions shall
      continue to be recorded annually, unless this Subsection 2.1(c) specifically
      states otherwise, until the earlier of (i) the last Plan Year that Phantom
      Contributions are required pursuant to Exhibit A, or (ii) the Plan Year of
      the
      Director's termination of service.

    


    (2)
      Termination
      Following a Change in Control

    If
      the
      Director exercises his withdrawal rights pursuant to Subsection 2.2, Phantom
      Contributions shall commence in the Plan Year following the Plan Year in which
      the Director first exercises his withdrawal rights. If a Change in Control
      occurs at the Bank, and within thirty-six (36) months of such Change in Control,
      the Director's service is either (i) involuntarily terminated, or (ii)
      voluntarily terminated by the Director after: (A) a material change in the
      Director's function, duties, or responsibilities, which change would cause
      the
      Director's position to become one of lesser responsibility, importance, or
      scope
      from the position the Director held at the time of the Change in Control, (B)
      a
      relocation of the Director's principal place of service by more than thirty
      (30)
      miles from its location prior to the Change in Control, or (C) a material
      reduction in the 


    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    


    


    benefits
      and perquisites to the Director from those being provided at the time of the
      Change in Control, the Phantom Contribution set forth below shall be required
      of
      the Bank. The Bank shall be required to record a lump sum Phantom Contribution
      in the Accrued Benefit Account within ten (10) days of the Director=s
      termination of service equal to (i) the full Emeritus Contribution required
      for
      the Plan Year in which such termination occurs, if not yet made, plus (ii)
      the
      present value (computed using a discount rate equal to the Interest Factor)
      of
      all remaining Emeritus Contributions to the Retirement Income Trust Fund, and
      (iii) the present value (computed using the a discount rate equal to the
      Interest Factor) of the interest only component of the Elective Contribution.
      The amount of such final Phantom Contribution shall be actuarially determined
      based on the Phantom Contribution required, at such time, in order to provide
      a
      benefit via this Agreement equal in amount to that benefit which would have
      been
      payable to the Director if no secular trust had been implemented and the benefit
      obligation had been accrued under APB Opinion No. 12, as amended by FAS 106.
      (Such actuarial determination shall reflect the fact that amounts shall be
      payable from both the Accrued Benefit Account as well as the Retirement Income
      Trust Fund and shall also reflect the amount and timing of any withdrawal(s)
      made by the Director from the Retirement Income Trust Fund pursuant to
      Subsection 2.2.)

    


    (3)
      Termination
      For Cause

    If
      the
      Director is terminated for Cause pursuant to Subsection 5.2, the entire balance
      of the Director=s
      Accrued
      Benefit Account at the time of such termination, which shall include any Phantom
      Contributions which have been recorded plus interest accrued on such Phantom
      Contributions, shall be forfeited.

    


    (4)
      Voluntary
      and Involuntary
      Termination of Service.

    If
      the
      Director exercises his withdrawal rights pursuant to Subsection 2.2, and the
      Director's service with the Bank is voluntarily or involuntarily terminated
      for
      any reason including termination due to disability of the Director, but
      excluding termination for Cause, or termination following a Change in Control,
      within thirty (30) days of such termination of service, no further Phantom
      Contributions shall be required of the Bank. Interest, at a rate equal to the
      Interest Factor, shall accrue on such Phantom Contributions until the Director’s
      Benefit Eligibility Date.


    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    


    


    (5)
      Death
      During Service.

    If
      the
      Director exercises his withdrawal rights pursuant to Subsection 2.2, and
      dies while employed by the Bank, Phantom Contributions included on Exhibit
      A
      shall be required of the Bank. Such Phantom Contributions shall commence in
      the
      Plan Year following the Plan Year in which the Director exercises his withdrawal
      rights and shall continue through the Plan Year in which the Director dies.
      The
      Bank shall also be required to record a final Phantom Contribution within thirty
      (30) days of the Director=s
      death.
      The amount of such final Phantom Contribution shall be actuarially determined
      based on the Phantom Contribution required at such time (if any), in order
      to
      provide a benefit via this Agreement equivalent to the Supplemental Retirement
      Income Benefit commencing within thirty (30) days of the date the Administrator
      receives notice of the Director=s
      death
      and continuing for the duration of the Payout Period. (Such actuarial
      determination shall reflect the fact that amounts shall be payable from the
      Accrued Benefit Account as well as the Retirement Income Trust Fund and shall
      also reflect the amount and timing of any withdrawal(s) made by the Director
      pursuant to Subsection 2.2.)

    


    
      	
              2.2.2

            	
              Withdrawals
                From Retirement Income Trust
                Fund.

            


    

    Exercise
      of withdrawal rights by the Director pursuant to the Elizabeth Hance Grantor
      Trust agreement shall terminate the Bank's obligation to make any further
      Contributions to the Retirement Income Trust Fund, and the Bank=s
      obligation to record Phantom Contributions pursuant to Subsection 2.1(c) shall
      commence. For purposes of this Subsection 2.2, Aexercise
      of withdrawal rights@
      shall
      mean those withdrawal rights to which the Director is entitled under Article
      III
      of the Elizabeth Hance Grantor Trust agreement and shall exclude any
      distributions made by the trustee of the Retirement Income Trust Fund to the
      Director for purposes of payment of income taxes in accordance with Subsection
      2.1 of this Agreement and the tax reimbursement formula contained in the trust
      document, or other trust expenses properly payable from the Elizabeth Hance
      Grantor Trust pursuant to the provisions of the trust document.

    


    
      	2.3           
              	
              Benefits
                Payable From Retirement Income Trust
                Fund

            


    

    Notwithstanding
      anything else to the contrary in this Agreement, in the event that the trustee
      of the Retirement Income Trust Fund purchases a life insurance policy with
      the
      Contributions to and, if applicable, earnings of the Trust, and such life
      insurance policy is intended to continue in force beyond the Payout Period
      for
      the disability or retirement benefits payable from the 


    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    


    


    Retirement
      Income Trust Fund pursuant to this Agreement, then the trustee shall have
      discretion to determine the portion of the cash value of such policy available
      for purposes of annuitizing the Retirement Income Trust Fund (it being
      understood that for purposes of this Section 2.3, Aannuitizing@
      does not
      mean surrender of such policy and annuitizing of the cash value received upon
      such surrender) to provide the disability or retirement benefits payable under
      this Agreement, after taking into consideration the amounts reasonably believed
      to be required in order to maintain the cash value of such policy to continue
      such policy in effect until the death of the Director and payment of death
      benefits thereunder.

    


    SECTION
      III

    RETIREMENT
      BENEFIT

    


    3.1   (a)
      Normal
      form of payment.

    If
      (i)
      the Director is employed with the Bank until reaching his Benefit Age and (ii)
      the Director has not made a Timely Election to receive a lump sum benefit,
      this
      Subsection 3.1(a) shall be controlling with respect to retirement
      benefits.

    


    The
      Retirement Income Trust Fund, measured as of the Director's Benefit Age, shall
      be annuitized (using the Interest Factor) into monthly installments and shall
      be
      payable for the Payout Period. Such benefit payments shall commence on the
      Director's Benefit Eligibility Date. Should Retirement Income Trust Fund assets
      actually earn a rate of return, following the date such balance is annuitized,
      which is less than the rate of return used to annuitize the Retirement Income
      Trust Fund, no additional contributions to the Retirement Income Trust Fund
      shall be required by the Bank in order to fund the final benefit payment(s)
      and
      make up for any shortage attributable to the less-than-expected rate of return.
      Should Retirement Income Trust Fund assets actually earn a rate of return,
      following the date such balance is annuitized, which is greater than the rate
      of
      return used to annuitize the Retirement Income Trust Fund, the final benefit
      payment to the Director (or his Beneficiary) shall distribute the excess amounts
      attributable to the greater-than-expected rate of return. The Director may
      at
      anytime during the Payout Period request to receive the unpaid balance of his
      Retirement Income Trust Fund in a lump sum payment. If such a lump sum payment
      is requested by the Director, payment of the balance of the Retirement Income
      Trust Fund in such lump sum form shall be made only if the Director gives notice
      to both 


    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    


    


    the
      Administrator and trustee in writing. Such lump sum payment shall be payable
      within thirty (30) days of such notice. In the event the Director dies at any
      time after attaining his Benefit Age, but prior to commencement or completion
      of
      all monthly payments due and owing hereunder, (i) the trustee of the Retirement
      Income Trust Fund shall pay to the Director's Beneficiary the monthly
      installments (or a continuation of such monthly installments if they have
      already commenced) for the balance of months remaining in the Payout Period,
      or
      (ii) the Director's Beneficiary may request to receive the unpaid balance of
      the
      Director's Retirement Income Trust Fund in a lump sum payment. If a lump sum
      payment is requested by the Beneficiary, payment of the balance of the
      Retirement Income Trust Fund in such lump sum form shall be made only if the
      Director's Beneficiary notifies both the Administrator and trustee in writing
      of
      such election within ninety (90) days of the Director's death. Such lump sum
      payment shall be payable within thirty (30) days of such notice.

    


    The
      Director=s
      Accrued
      Benefit Account (if applicable), measured as of the Director=s
      Benefit
      Age, shall be annuitized (using the Interest Factor) into monthly installments
      and shall be payable for the Payout Period. Such benefit payments shall commence
      on the Director=s
      Benefit
      Eligibility Date. In the event the Director dies at any time after attaining
      his
      Benefit Age, but prior to commencement or completion of all the payments due
      and
      owing hereunder, (i) the Bank shall pay to the Director=s
      Beneficiary the same monthly installments (or a continuation of such monthly
      installments if they have already commenced) for the balance of months remaining
      in the Payout Period.

    


    (b)
      Alternative
      payout option.

    If
      (i)
      the Director is employed with the Bank until reaching his Benefit Age, and
      (ii)
      the Director has made a Timely Election to receive a lump sum benefit, this
      Subsection 3.1(b) shall be controlling with respect to retirement benefits.
      

    


    The
      balance of the Retirement Income Trust Fund and the Accrued Benefit Account
      (if
      applicable), measured as of the Director=s
      Benefit
      Age, shall be paid to the Director in a lump sum on his Benefit Eligibility
      Date. In the event the Director dies after becoming eligible for such payment
      (upon attainment of his Benefit Age), but before the actual payment is made,
      his



    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    


    


    Beneficiary
      shall be entitled to receive the lump sum benefit in accordance with this
      Subsection 3.1(b) within thirty (30) days of the date the Administrator receives
      notice of the Director’s death. Notwithstanding
      the foregoing, unless the Director has made a Timely Election to receive a
      lump
      sum distribution from the Accrued Benefit Account, distributions from the
      Accrued Benefit Account will be paid over the Payout Period, commencing within
      thirty (30) days of the Director’s Benefit Age.

    


    SECTION
      IV

    PRE-RETIREMENT
      DEATH BENEFIT

    


    4.1          
      (a)
      Normal form of payment.

    If
      (i)
      the Director dies while employed by the Bank, and (ii) the Director has not
      made
      a Timely Election to receive a lump sum benefit, this Subsection 4.1(a) shall
      be
      controlling with respect to pre-retirement death benefits.

    


    The
      balance of the Director=s
      Retirement Income Trust Fund, measured as of the later of (i) the
      Director=s
      death,
      or (ii) the date any final lump sum Contribution is made pursuant to Subsection
      2.1(b), shall be annuitized (using the Interest Factor) into monthly
      installments and shall be payable for the Payout Period. Such benefits shall
      commence within thirty (30) days of the date the Administrator receives notice
      of the Director=s
      death.
      Should Retirement Income Trust Fund assets actually earn a rate of return,
      following the date such balance is annuitized, which is less than the rate
      of
      return used to annuitize the Retirement Income Trust Fund, no additional
      contributions to the Retirement Income Trust Fund shall be required by the
      Bank
      in order to fund the final benefit payment(s) and make up for any shortage
      attributable to the less-than-expected rate of return. Should Retirement Income
      Trust Fund assets actually earn a rate of return, following the date such
      balance is annuitized, which is greater than the rate of return used to
      annuitize the Retirement Income Trust Fund, the final benefit payment to the
      Director=s
      Beneficiary shall distribute the excess amounts attributable to the
      greater-than-expected rate of return. The Director=s
      Beneficiary may request to receive the unpaid balance of the
      Director=s
      Retirement Income Trust Fund in a lump sum payment. If a lump sum payment is
      requested by the Beneficiary, payment of the balance of the Retirement Income
      Trust Fund in such lump sum form shall be made only if the Director=s
      Beneficiary notifies both the Administrator and trustee 


    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    


    


    in
      writing of such election within ninety (90) days of the Director=s
      death.
      Such lump sum payment shall be made within thirty (30) days of such
      notice.

    


    The
      Director=s
      Accrued
      Benefit Account (if applicable), measured as of the later of (i) the
      Director's death or (ii) the date any final lump sum Phantom Contribution is
      recorded in the Accrued Benefit Account pursuant to Subsection 2.1(c), shall
      be
      annuitized (using the Interest Factor) into monthly installments and shall
      be
      payable to the Director's Beneficiary for the Payout Period. Such benefit
      payments shall commence within thirty (30) days of the date the Administrator
      receives notice of the Director=s
      death,
      or if later, within thirty (30) days after any final lump sum Phantom
      Contribution is recorded in the Accrued Benefit Account in accordance with
      Subsection 2.1(c). 

    


    (b)
      Alternative
      payout option.

    If
      (i)
      the Director dies while employed by the Bank, and (ii) the Director has made
      a
      Timely Election to receive a lump sum benefit, this Subsection 4.1(b) shall
      be
      controlling with respect to pre-retirement death benefits.

    


    The
      balance of the Director=s
      Retirement Income Trust Fund and the Accrued Benefit Account (if applicable),
      measured as of the later of (i) the Director=s
      death,
      or (ii) the date any final lump sum Contribution is made pursuant to Subsection
      2.1(b), shall be paid to the Director's Beneficiary in a lump sum within thirty
      (30) days of the date the Administrator receives notice of the Director's
      death.
      Notwithstanding the foregoing, unless the Director has made a Timely Election
      to
      receive a lump sum distribution with respect to the Accrued Benefit Account,
      distributions from the Accrued Benefit Account will be paid over the Payout
      Period commencing within thirty (30) days of the date the Administrator receives
      notice of the Director=s
      death. 

    


    SECTION
      V

    BENEFIT(S)
      IN THE EVENT OF TERMINATION OF SERVICE

    PRIOR
      TO BENEFIT AGES

    


    
      	5.1           
              	
              Voluntary
                or Involuntary Termination of Service Other Than for Cause.
                In the event the Director=s
                service with the Bank is voluntarily or involuntarily terminated
                prior to
                Benefit Age, 

            


    


    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    


    


    for
      any
      reason, including a Change in Control, but excluding (i) any disability related
      termination for which the Board of Directors has approved early payment of
      benefits pursuant to Subsection 6.1, (ii) the Director's pre-retirement death,
      which shall be covered in Section IV, (iii) or termination for Cause, which
      shall be covered in Subsection 5.2, the Director (or his Beneficiary) shall
      be
      entitled to receive benefits in accordance with this Subsection 5.1. Payments
      of
      benefits pursuant to this Subsection 5.1 shall be made in accordance with
      Subsection 5.1(a) or 5.1(b) below, as applicable.

    


    (a)
      Normal
      form of payment.

    (1)
      Director
      Lives Until Benefit Age

    If
      (i)
      after such termination, the Director lives until attaining his Benefit Age,
      and
      (ii) the Director has not made a Timely Election to receive a lump sum benefit,
      this Subsection 5.1(a)(1) shall be controlling with respect to retirement
      benefits.

    


    The
      Retirement Income Trust Fund, measured as of the Director's Benefit Age, shall
      be annuitized (using the Interest Factor) into monthly installments and shall
      be
      payable for the Payout Period. Such payments shall commence on the Director's
      Benefit Eligibility Date. Should Retirement Income Trust Fund assets actually
      earn a rate of return, following the date such balance is annuitized, which
      is
      less than the rate of return used to annuitize the Retirement Income Trust
      Fund,
      no additional contributions to the Retirement Income Trust Fund shall be
      required by the Bank in order to fund the final benefit payment(s) and make
      up
      for any shortage attributable to the less-than-expected rate of return. Should
      Retirement Income Trust Fund assets actually earn a rate of return, following
      the date such balance is annuitized, which is greater than the rate of return
      used to annuitize the Retirement Income Trust Fund, the final benefit payment
      to
      the Director (or his Beneficiary) shall distribute the excess amounts
      attributable to the greater-than-expected rate of return. The Director may
      at
      anytime during the Payout Period request to receive the unpaid balance of his
      Retirement Income Trust Fund in a lump sum payment. If such a lump sum payment
      is requested by the Director, payment of the balance of the Retirement Income
      Trust Fund in such lump sum form shall be made only if the Director gives notice
      to both the Administrator and trustee in writing. Such lump sum payment shall
      be
      payable within thirty (30) days of such notice. In the event the Director dies
      at any time after attaining his Benefit Age, but prior to commencement or
      completion of all monthly payments due and owing hereunder, (i)



    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    


    


    the
      trustee of the Retirement Income Trust Fund shall pay to the Director's
      Beneficiary the monthly installments (or a continuation of the monthly
      installments if they have already commenced) for the balance of months remaining
      in the Payout Period, or (ii) the Director's Beneficiary may request to receive
      the unpaid balance of the Director's Retirement Income Trust Fund in a lump
      sum
      payment. If a lump sum payment is requested by the Beneficiary, payment of
      the
      balance of the Retirement Income Trust Fund in such lump sum form shall be
      made
      only if the Director's Beneficiary notifies both the Administrator and trustee
      in writing of such election within ninety (90) days of the Director's death.
      Such lump sum payment shall be made within thirty (30) days of such
      notice.

    


    The
      Director=s
      Accrued
      Benefit Account (if applicable), measured as of the Director=s
      Benefit
      Age, shall be annuitized (using the Interest Factor) into monthly installments
      and shall be payable for the Payout Period. Such benefit payments shall commence
      on the Director=s
      Benefit
      Eligibility Date. In the event the Director dies at any time after attaining
      his
      Benefit Age, but prior to commencement or completion of all the payments due
      and
      owing hereunder, (i) the Bank shall pay to the Director=s
      Beneficiary the same monthly installments (or a continuation of such monthly
      installments if they have already commenced) for the balance of months remaining
      in the Payout Period.

    


    (2)
      Director
      Dies Prior to Benefit Age

    If
      (i)
      after such termination, the Director dies prior to attaining his Benefit Age,
      and (ii) the Director has not made a Timely Election to receive a lump sum
      benefit, this Subsection 5.1(a)(2) shall be controlling with respect to
      retirement benefits. 

    


    The
      Retirement Income Trust Fund, measured as of the date of the Director's death,
      shall be annuitized (using the Interest Factor) into monthly installments and
      shall be payable for the Payout Period. Such payments shall commence within
      thirty (30) days of the date the Administrator receives notice of the Director's
      death. Should Retirement Income Trust Fund assets actually earn a rate of
      return, following the date such balance is annuitized, which is less than the
      rate of return used to annuitize the Retirement Income Trust Fund, no additional
      contributions to the Retirement Income Trust Fund shall be required by the
      Bank
      in order to fund the final benefit payment(s) and make up for any shortage
      attributable to the less-than-expected 


    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    


    


    rate
      of
      return. Should Retirement Income Trust Fund assets actually earn a rate of
      return, following the date such balance is annuitized, which is greater than
      the
      rate of return used to annuitize the Retirement Income Trust Fund, the final
      benefit payment to the Director's Beneficiary shall distribute the excess
      amounts attributable to the greater-than-expected rate of return. The Director's
      Beneficiary may request to receive the unpaid balance of the Director's
      Retirement Income Trust Fund in the form of a lump sum payment. If a lump sum
      payment is requested by the Beneficiary, payment of the balance of the
      Retirement Income Trust Fund in such lump sum form shall be made only if the
      Director's Beneficiary notifies both the Administrator and trustee in writing
      of
      such election within ninety (90) days of the Director's death. Such lump sum
      payment shall be made within thirty (30) days of such notice.

    


    The
      Director=s
      Accrued
      Benefit Account (if applicable), measured as of the date of the
      Director=s
      death,
      shall be annuitized (using the Interest Factor) into monthly installments and
      shall be payable for the Payout Period. Such payments shall commence within
      thirty (30) days of the date the Administrator receives notice of the
      Director=s
      death.

    


    (b)
      Alternative
      Payout Option.

    (1)
      Director
      Lives Until Benefit Age

    If
      (i)
      after such termination, the Director lives until attaining his Benefit Age,
      and
      (ii) the Director has made a Timely Election to receive a lump sum benefit,
      this
      Subsection 5.1(b)(1) shall be controlling with respect to retirement benefits.
      

    


    The
      balance of the Retirement Income Trust Fund and the Accrued Benefit Account
      (if
      applicable), measured as of the Director's Benefit Age, shall be paid to the
      Director in a lump sum on his Benefit Eligibility Date. In the event the
      Director dies after becoming eligible for such payment (upon attainment of
      his
      Benefit Age), but before the actual payment is made, his Beneficiary shall
      be
      entitled to receive the lump sum benefit in accordance with this Subsection
      5.1(b)(1) within thirty (30) days of the date the Administrator receives notice
      of the Director's death.
      Notwithstanding the foregoing, unless the Director has made a Timely Election
      to
      receive a lump sum distribution from the Accrued Benefit Account, distributions
      from the Accrued Benefit Account will be paid over the Payout Period, commencing
      within thirty (30) days of the Director’s Benefit Age.


    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    


    


    (2)
      Director
      Dies Prior to Benefit Age

    If
      (i)
      after such termination, the Director dies prior to attaining his Benefit Age,
      and (ii) the Director has made a Timely Election to receive a lump sum benefit,
      this Subsection 5.1(b)(2) shall be controlling with respect to pre-retirement
      death benefits. 

    


    The
      balance of the Retirement Income Trust Fund and the Accrued Benefit Account
      (if
      applicable), measured as of the date of the Director's death, shall be paid
      to
      the Director's Beneficiary within thirty (30) days of the date the Administrator
      receives notice of the Director's death.
      Notwithstanding the foregoing, unless the Director has made a Timely Election
      to
      receive a lump sum distribution with respect to the Accrued Benefit Account,
      distributions from the Accrued Benefit Account will be paid over the Payout
      Period commencing within thirty (30) days of the date the Administrator receives
      notice of the Director=s
      death.

    


    
      	5.2           
              	
              Termination
                For Cause.

            


    

    If
      the
      Director is terminated for Cause, all benefits under this Agreement, other
      than
      those which can be paid from previous Contributions to the Retirement Income
      Trust Fund (and earnings on such Contributions), shall be forfeited.
      Furthermore, no further Contributions (or Phantom Contributions, as applicable)
      shall be required of the Bank for the year in which such termination for Cause
      occurs (if not yet made). The Director shall be entitled to receive a benefit
      in
      accordance with this Subsection 5.2. 

    


    The
      balance of the Director=s
      Retirement Income Trust Fund shall be paid to the Director in a lump sum on
      his
      Benefit Eligibility Date. In the event the Director dies prior to his Benefit
      Eligibility Date, his Beneficiary shall be entitled to receive the balance
      of
      the Director's Retirement Income Trust Fund in a lump sum within thirty (30)
      days of the date the Administrator receives notice of the Director's death.
      

    


    


    


    


    


     


    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    


    SECTION
      VI

    OTHER
      BENEFITS

    


    
      	
              6.1

            	
              (a)
                Disability
                Benefit.

            


    

    If
      the
      Director's service is terminated prior to Benefit Age due to a disability that
      meets the criteria set forth below, the Director may request to receive the
      Disability Benefit in lieu of the retirement benefit(s) available pursuant
      to
      Section 5.1 (which is (are) not available prior to the Director's Benefit
      Eligibility Date).

    


    In
      any
      instance in which it is determined by a duly licensed, independent physician
      selected by the Bank, that the Director is
      “disabled,” the
      Director shall be entitled to receive a lump sum Disability Benefit
      hereunder. For
      these
      purposes, a distribution from the Accrued Benefit Account (but not the
      Retirement Income Trust Fund) shall require a determination that the Director
      is
“disabled”
      within the meaning of proposed Treasury Regulation Section
      1.409A-3(g)(4).
      The
      Director shall be entitled to the following lump sum benefit(s) in lieu of
      any
      benefits under Subsection 5.1. The lump sum benefit(s) to which the Director
      is
      entitled shall include: (i) the balance of the Retirement Income Trust Fund,
      plus (ii) the balance of the Accrued Benefit Account (if applicable). The
      benefit(s) shall be paid within thirty (30) days following the date of the
      Director's final disability determination. In the event the Director dies after
      becoming eligible for such payment(s) but before the actual payment(s) is (are)
      made, his Beneficiary shall be entitled to receive the benefit(s) provided
      for
      in this Subsection 6.1(a) within thirty (30) days of the date the Administrator
      receives notice of the Director's death.

    


    (b)
      Disability
      Benefit - Supplemental.

    Furthermore,
      if Board of Director approval is obtained within thirty (30) days of the
      Director=s
      death,
      the Bank shall make a direct, lump sum payment to the Director's Beneficiary
      in
      an amount equal to the sum of all remaining Contributions (or Phantom
      Contributions) set forth in Exhibit A, but not required pursuant to Subsection
      2.1(b) (or 2.1(c)) due to the Director's disability-related termination. Such
      lump sum payment, if approved by the Board of Directors, shall be payable to
      the
      Director=s
      Beneficiary within thirty (30) days of such Board of Director
      approval.

    



    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    


    
      	
              6.2

            	
              Additional
                Death Benefit - Burial Expense.

            


    

    Upon
      the
      Director=s
      death,
      the Director=s
      Beneficiary shall also be entitled to receive a one-time lump sum death benefit
      in the amount of Ten Thousand Dollars ($10,000). This benefit shall be paid
      directly from the Bank to the Beneficiary and shall be provided specifically
      for
      the purpose of providing payment for burial and/or funeral expenses of the
      Director. Such death benefit shall be payable within thirty (30) days of the
      date the Administrator receives notice of the Director=s
      death.
      The Director=s
      Beneficiary shall not be entitled to such benefit if the Director is terminated
      for Cause prior to death.

    


    SECTION
      VII

    BENEFICIARY
      DESIGNATION

    


    The
      Director shall make an initial designation of primary and secondary
      Beneficiaries upon execution of this Agreement and shall have the right to
      change such designation, at any subsequent time, by submitting to (i) the
      Administrator, and
      (ii) the
      trustee of the Retirement Income Trust Fund, in substantially the form attached
      as Exhibit B to this Agreement, a written designation of primary and secondary
      Beneficiaries. Any Beneficiary designation made subsequent to execution of
      this
      Agreement shall become effective only when receipt thereof is acknowledged
      in
      writing by the Administrator.

    


    


    SECTION
      VIII

    DIRECTOR'S
      RIGHT TO ASSETS

    


    The
      rights of the Director, any Beneficiary, or any other person claiming through
      the Director under this Agreement, shall be solely those of an unsecured general
      creditor of the Bank. The Director, the Beneficiary, or any other person
      claiming through the Director, shall only have the right to receive from the
      Bank those payments or amounts so specified under this Agreement. The Director
      agrees that he, his Beneficiary, or any other person claiming through him shall
      have no rights or interests whatsoever in any asset of the Bank, including
      any
      insurance policies or contracts which the Bank may possess or obtain to
      informally fund this Agreement. Any asset used or acquired by the Bank in
      connection with the liabilities it has assumed under this Agreement shall not
      be
      deemed to be held under any trust for the benefit of the Director or his
      Beneficiaries, unless such asset is contained in the rabbi trust described
      in



    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    


    


    Section
      XII of this Agreement. Any such asset shall be and remain a general, unpledged
      asset of the Bank in the event of the Bank=s
      insolvency.

    


    SECTION
      IX

    RESTRICTIONS
      UPON FUNDING

    


    The
      Bank
      shall have no obligation to set aside, earmark or entrust any fund or money
      with
      which to pay its obligations under this Agreement, other than those
      Contributions required to be made to the Retirement Income Trust Fund. The
      Director, his Beneficiaries or any successor in interest to him shall be and
      remain simply a general unsecured creditor of the Bank in the same manner as
      any
      other creditor having a general claim for matured and unpaid compensation.
      The
      Bank reserves the absolute right in its sole discretion to either purchase
      assets to meet its obligations undertaken by this Agreement or to refrain from
      the same and to determine the extent, nature, and method of such asset
      purchases. Should the Bank decide to purchase assets such as life insurance,
      mutual funds, disability policies or annuities, the Bank reserves the absolute
      right, in its sole discretion, to replace such assets from time to time or
      to
      terminate its investment in such assets at any time, in whole or in part. At
      no
      time shall the Director be deemed to have any lien, right, title or interest
      in
      or to any specific investment or to any assets of the Bank. If the Bank elects
      to invest in a life insurance, disability or annuity policy upon the life of
      the
      Director, then the Director shall assist the Bank by freely submitting to a
      physical examination and by supplying such additional information necessary
      to
      obtain such insurance or annuities.

    


    


    SECTION
      X

    ACT
      PROVISIONS

    


    
      	10.1         
              	
              Named
                Fiduciary and Administrator.
                The Bank, as Administrator, shall be the Named Fiduciary of this
                Agreement. As Administrator, the Bank shall be responsible for the
                management, control and administration of the Agreement as established
                herein. The Administrator may delegate to others certain aspects
                of the
                management and operational responsibilities of the Agreement, including
                the employment of advisors and the delegation of ministerial duties
                to
                qualified individuals.

            


    


    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

    


    


    
      	10.2         
              	
              Claims
                Procedure and Arbitration11.2 Claims
                Procedure and Arbitration.
                In the event that benefits under this Agreement are not paid to the
                Director (or to his Beneficiary in the case of the Director's death)
                and
                such claimants feel they are entitled to receive such benefits, then
                a
                written claim must be made to the Administrator within sixty (60)
                days
                from the date payments are refused. The Administrator shall review
                the
                written claim and, if the claim is denied, in whole or in part, it
                shall
                provide in writing, within ninety (90) days of receipt of such claim,
                its
                specific reasons for such denial, reference to the provisions of
                this
                Agreement upon which the denial is based, and any additional material
                or
                information necessary to perfect the claim. Such writing by the
                Administrator shall further indicate the additional steps which must
                be
                undertaken by claimants if an additional review of the claim denial
                is
                desired. 

            


    

    


    If
      claimants desire a second review, they shall notify the Administrator in writing
      within sixty (60) days of the first claim denial. Claimants may review this
      Agreement or any documents relating thereto and submit any issues and comments,
      in writing, they may feel appropriate. In its sole discretion, the Administrator
      shall then review the second claim and provide a written decision within sixty
      (60) days of receipt of such claim. This decision shall state the specific
      reasons for the decision and shall include reference to specific provisions
      of
      this Agreement upon which the decision is based.

    


    If
      claimants continue to dispute the benefit denial based upon completed
      performance of this Plan and the Agreement or the meaning and effect of the
      terms and conditions thereof, then claimants may submit the dispute to
      mediation, administered by the American Arbitration Association (AAAA@)
      (or a
      mediator selected by the parties) in accordance with the AAA=s
      Commercial Mediation Rules. If mediation is not successful in resolving the
      dispute, it shall be settled by arbitration administered by the AAA under its
      Commercial Arbitration Rules, and judgment on the award rendered by the
      arbitrator(s) may be entered in any court having jurisdiction
      thereof.

    


    


    


    


    


     


    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

    


    SECTION
      XI

    MISCELLANEOUS

     

    
      
        	
                11.1

              	
                No
                  Effect on Employment Rights.
                  Nothing contained herein will confer upon the Director the right
                  to be
                  retained in the service of the Bank nor limit the right of the
                  Bank to
                  discharge or otherwise deal with the Director without regard to
                  the
                  existence of the Agreement.

              


      

      


      
        	
                11.2

              	
                Governing
                  Law. The
                  Agreement is established under, and will be construed according
                  to, the
                  laws of the state of New Jersey, to the extent such laws are not
                  preempted
                  by the Act or other applicable federal law and valid regulations
                  published
                  thereunder.

              


      

      


      
        	
                11.3

              	
                Construction
                  and Severability. The
                  funding of and payment of benefits from the Accrued Benefit Account
                  is
                  deemed to be a nonqualified deferred compensation arrangement within
                  the
                  meaning of Code Section 409A. To the extent that the funding of
                  a benefit
                  under the Retirement Income Trust Fund under this Agreement is
                  deemed to
                  be a nonqualified deferred compensation arrangement, then that
                  part of
                  this Agreement shall also be operated, administered and construed
                  consistent with Code Section 409A. To the extent that a provision
                  of the
                  Agreement fails to comply with Code Section 409A and a construction
                  consistent with Code Section 409A is not possible, such provision
                  shall be
                  void ab initio.
                  In addition, the Agreement shall be subject to amendment, with
                  or without
                  advance notice to Director and other interested parties, and on
                  a
                  prospective or retroactive basis, including but not limited to
                  amendment
                  in a manner that adversely affects the rights of Directors and
                  other
                  interested parties, to the extent necessary to effect compliance
                  with Code
                  Section 409A. In the event that any of the provisions of this Agreement
                  or
                  portion thereof, are held to be inoperative or invalid by any court
                  of
                  competent jurisdiction, then: (1) insofar as is reasonable, effect
                  will be
                  given to the intent manifested in the provisions held invalid or
                  inoperative, and (2) the validity and enforceability of the remaining
                  provisions will not be affected
                  thereby.

              


      

      


      
        	
                11.4

              	
                Treatment
                  as a Director.
                  For purposes of this Agreement, it is assumed that the Director
                  is treated
                  as a “director” in accordance with Proposed Treasury Regulation Section
                  1.409A-1(h)(2). If under future guidance or rulings promulgated
                  by the
                  Internal Revenue Service or Treasury Department under Code Section
                  409A it
                  is determined that the Director should properly be
                  

              


      


      
        
          
          

        

        
          28

          
            

          

        

        
          
          

        

      


      


      treated
        as an “employee” for purposes of this Agreement, distributions to the Director
        due to Separation from Service will be made in accordance with the provisions
        of
        Proposed Treasury Regulation Section 1.409A-1(h)(1).

      


      
        	
                11.5

              	
                Incapacity
                  of Recipient.
                  In
                  the event the Director is declared incompetent and a conservator
                  or other
                  person legally charged with the care of his person or Estate is
                  appointed,
                  any benefits under the Agreement to which such Director is entitled
                  shall
                  be paid to such conservator or other person legally charged with
                  the care
                  of his person or Estate. 

              


      

       

      
        	
                11.6

              	
                Unclaimed
                  Benefit.
                  The Director shall keep the Bank informed of his current address
                  and the
                  current address of his Beneficiaries. The Bank shall not be obligated
                  to
                  search for the whereabouts of any person. If the location of the
                  Director
                  is not made known to the Bank as of the date upon which any payment
                  of any
                  benefits from the Accrued Benefit Account may first be made, the
                  Bank
                  shall delay payment of the Director's benefit payment(s) until
                  the
                  location of the Director is made known to the Bank; however, the
                  Bank
                  shall only be obligated to hold such benefit payment(s) for the
                  Director
                  until the expiration of thirty-six (36) months.


              


      

      


      
        	
                11.7

              	
                Limitations
                  on Liability.
                  Notwithstanding any of the preceding provisions of the Agreement,
                  no
                  individual acting as an employee or agent of the Bank, or as a
                  member of
                  the Board of Directors shall be personally liable to the Director
                  or any
                  other person for any claim, loss, liability or expense incurred
                  in
                  connection with the Agreement.

              


      

      


      
        	
                11.8

              	
                GenderDirectors
                  shall be personally liable to the Executive or any other person
                  for any
                  claim, loss, liability or expense incurred in connection with the
                  Agreement.
                  Whenever in this Agreement words are used in the masculine or neuter
                  gender, they shall be read and construed as in the masculine, feminine
                  or
                  neuter gender, whenever they should so
                  apply.

              


      

      


      
        	
                11.9

              	
                Effect
                  on Other Corporate Benefit Agreements.
                  Nothing contained in this Agreement shall affect the right of the
                  Director
                  to participate in or be covered by any qualified or non-qualified
                  pension,
                  profit sharing, group, bonus or other supplemental compensation
                  or fringe
                  benefit agreement constituting a part of the Bank's existing or
                  future
                  compensation structure.

              


      

      


      
        	
                11.10

              	
                Suicide.
                  Notwithstanding anything to the contrary in this Agreement, if
                  the
                  Director's death results from suicide, whether sane or insane,
                  within
                  twenty-six (26) months after execution of this


              


      


      
        
          
          

        

        
          29

          
            

          

        

        
          
          

        

      


      


      Agreement,
        all further Contributions to the Retirement Income Trust Fund (or Phantom
        Contributions recorded in the Accrued Benefit Account) shall thereupon cease,
        and no Contribution (or Phantom Contribution) shall be made by the Bank to
        the
        Retirement Income Trust Fund (or recorded in the Accrued Benefit Account)
        in the
        year such death resulting from suicide occurs (if not yet made). All benefits
        other than those available from previous Contributions to the Retirement
        Income
        Trust Fund under this Agreement shall be forfeited, and this Agreement shall
        become null and void. The balance of the Retirement Income Trust Fund, measured
        as of the Director's date of death, shall be paid to the Beneficiary within
        thirty (30) days of the date the Administrator receives notice of the Director's
        death. 

      


      
        	
                11.11

              	
                Inurement.
                  This Agreement shall be binding upon and shall inure to the benefit
                  of the
                  Bank, its successors and assigns, and the Director, his successors,
                  heirs,
                  executors, administrators, and
                  Beneficiaries.

              


      

      


      
        	
                11.12

              	
                Headings.
                  Headings and sub-headings in this Agreement are inserted for reference
                  and
                  convenience only and shall not be deemed a part of this
                  Agreement.

              


      

      


      
        	
                11.13

              	
                Establishment
                  of a Rabbi Trust.
                  The Bank shall establish a rabbi trust into which the Bank shall
                  contribute assets which shall be held therein, subject to the claims
                  of
                  the Bank's creditors in the event of the Bank's "Insolvency" (as
                  defined
                  in such rabbi trust agreement), until the contributed assets are
                  paid to
                  the Director and/or his Beneficiary in such manner and at such
                  times as
                  specified in this Agreement. It is the intention of the Bank that
                  the
                  contribution or contributions to the rabbi trust shall provide
                  the Bank
                  with a source of funds to assist it in meeting the liabilities
                  of this
                  Agreement.

              


      

      


      
        	
                11.14

              	
                Source
                  of Payments.
                  All payments provided in this Agreement shall be timely paid in
                  cash or
                  check from the general funds of the Bank or the assets of the rabbi
                  trust,
                  to the extent made from the Accrued Benefit Account.
                  

              


      

      



      
        
          
          

        

        
          30

          
            

          

        

        
          
          

        

      


      


      


      SECTION
        XII

      AMENDMENT/PLAN
        TERMINATION

      


      
        	
                12.1

              	
                Amendment
                  or Plan Termination.
                  The Bank intends this Agreement to be permanent, but
                  reserves the right to amend or terminate the Agreement when such
                  amendment
                  or termination is required due to objection to the plan by the
                  Bank's
                  regulatory authorities. The
                  Agreement may not be amended or terminated without the express
                  written
                  consent of the parties. Any amendment or termination of the Agreement
                  shall be made pursuant to a resolution of the Board of Directors
                  of the
                  Bank and shall be effective as of the date of such resolution.
                  No
                  amendment or termination of the Agreement shall directly or indirectly
                  deprive the Director of all or any portion of the Director's Retirement
                  Income Trust Fund (and Accrued Benefit Account, if applicable)
                  as of the
                  effective date of the resolution amending or terminating the
                  Agreement.

              


      

      


      Notwithstanding
        the foregoing, if an individual Director’s agreement is subject to Code Section
        409A, :the Bank may terminate this Agreement only under the following
        circumstances and conditions:

      


      
        	 	
                (a)

              	
                The
                  Board of Directors may terminate the Agreement 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. §503(b)(1)(A), provided that the
                  amounts deferred under the Agreement are included in the Director’s gross
                  income in the latest of (i) the calendar year in which the Agreement
                  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.

              


      

      


      
        	 	
                (b)

              	
                The
                  Board of Directors may terminate the Agreement within the 30 days
                  preceding a Change in Control (but not following a Change in Control),
                  provided that the Agreement shall only be treated as terminated
                  if all
                  substantially similar arrangements sponsored by the Bank are terminated
                  so
                  that the Director 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.

              


      


      
        
          
          

        

        
          31

          
            

          

        

        
          
          

        

      


      


      
        	 	
                (c)

              	
                The
                  Board of Directors may terminate the Agreement provided that (i)
                  all
                  arrangements sponsored by the Bank that would be aggregated with
                  this
                  Agreement under Proposed Regulation Section 1.409A-1(c) if the
                  Director
                  covered by this Agreement was also covered by any of those other
                  arrangements are also terminated; (ii) 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; (iii) all payments are made within 24 months
                  of the
                  termination of the arrangements; and (iv) the Bank does not adopt
                  a new
                  arrangement that would be aggregated with any terminated arrangement
                  under
                  Proposed Regulation Section 1.409A-1(c) if the Director participated
                  in
                  both arrangements, at any time within five years following the
                  date of
                  termination of the arrangement.

              


      

      


      
        	
                12.2

              	
                Director's
                  Right to Payment Following Plan Termination.
                  In
                  the event of a termination of the Agreement, the Director shall
                  be
                  entitled to the balance, if any, of his Retirement Income Trust
                  Fund (and
                  Accrued Benefit Account, if applicable). However, if such termination
                  is
                  done in anticipation of or pursuant to a AChange
                  in Control,@
                  such balance(s) shall include the final Contribution (or final
                  Phantom
                  Contribution) made (or recorded) pursuant to Subsection 2.1(b)(2)
                  (or
                  2.1(c)(2)). Payment of the balance(s) of the Director's Retirement
                  Income
                  Trust Fund (and Accrued Benefit Account, if applicable) shall not
                  be
                  dependent upon his continuation of service with the Bank following
                  the
                  termination date of the Agreement. Payment of the balance(s) of
                  the
                  Director's Retirement Income Trust Fund (and Accrued Benefit Account,
                  if
                  applicable) shall be made in a lump sum within thirty (30) days
                  of the
                  date of termination of the
                  Agreement.

              


      

      


      SECTION
        XIII

      EXECUTION

      


      
        	
                13.1

              	
                This
                  Agreement and the Elizabeth Hance Grantor Trust Agreement set forth
                  the
                  entire understanding of the parties hereto with respect to the
                  transactions contemplated hereby, and any previous agreements or
                  understandings between the parties hereto regarding the subject
                  matter
                  hereof are merged into and superseded by this Agreement and the
                  Elizabeth
                  Hance Grantor Trust Agreement. 

              


      


      
        
          
          

        

        
          32

          
            

          

        

        
          
          

        

      


      


      
        	
                13.2

              	
                This
                  Agreement shall be executed in triplicate, each copy of which,
                  when so
                  executed and delivered, shall be an original, but all three copies
                  shall
                  together constitute one and the same
                  instrument.

              


      

      


      


      


      


      


      [Remainder
        of Page Intentionally
        Left Blank]


      
        
          
          

        

        
          33

          
            

          

        

        
          
          

        

      


      IN
        WITNESS WHEREOF, the Bank and the Director have caused this Agreement to
        be
        executed on the day and date first above written.

      


      


      
        	
                ATTEST:

              	 	
                MAGYAR
                  BANK:

              
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 /s/	 	
                By:
                  

              	 /s/
	 	 	 	 
	 	 	
                Title:

              	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	
                WITNESS:

              	 	
                DIRECTOR:

              
	 	 	 	 
	 /s/	 	 /s/
                Elizabeth E. Hance
	 	 	 	 
	 	 	 	 
	 	 	 	 


      

      


      


      


      



      
        
          
          

        

        
          34

          
            

          

        

        
          
          

        

      


      


      


      



      CONDITIONS,
        ASSUMPTIONS,

      AND

      SCHEDULE
        OF CONTRIBUTIONS AND PHANTOM CONTRIBUTIONS

      


      


      
        	1.    	
                Interest
                  Factor - for purposes of: 

              


      

      


      
        	 	
                a.

              	
                the
                  Accrued Benefit Account - shall be six percent (6%) per annum,
                  compounded
                  monthly.

              


      

      


      
        	 	
                b.

              	
                the
                  Elective Contributions - shall be ten percent (10%) per annum,
                  compounded
                  monthly.

              


      

      


      
        	 	
                c.

              	
                the
                  Emeritus Contributions - shall be six percent (6%) per annum, compounded
                  monthly.

              


      

      


      
        	 	
                d.

              	
                the
                  Retirement Income Trust Fund - for purposes of annuitizing the
                  balance of
                  the Retirement Income Trust Fund over the Payout Period, the trustee
                  of
                  the Elizabeth Hance Grantor Trust shall exercise discretion in
                  selecting
                  the appropriate rate given the nature of the investments contained
                  in the
                  Retirement Income Trust Fund and the expected return associated
                  with the
                  investments. For these purposes, if the trustee of the Retirement
                  Income
                  Trust Fund has purchased a life insurance policy, the trustee shall
                  have
                  the discretion to determine the portion of the cash value of such
                  policy
                  available for purposes of annuitizing the Retirement Income Trust
                  Fund, in
                  accordance with Section 2.3 of the Agreement.


              


      

      


      
        	
                2.

              	
                The
                  amount of the annual Emeritus Contributions (or Phantom Contributions)
                  to
                  the Retirement Income Trust Fund (or Accrued Benefit Account) has
                  been
                  based on the annual interest-adjusted accounting accruals which
                  would be
                  required of the Bank through the earlier of the Director=s
                  death or Benefit Age, (i) pursuant to APB Opinion No. 12, as amended
                  by
                  FAS 106 and (ii) assuming a discount rate equal to six percent
                  (6%) per
                  annum, in order to provide a portion of the unfunded, non-qualified
                  Supplemental Retirement Income Benefit. The Emeritus Contributions
                  are
                  calculated to support a benefit based upon 60%
                  of
                  the Director’s total board fees, committee fees and/or retainer in the
                  twelve months prior to Director’s Benefit Eligibility Date.
                  

              


      

      


      
        	
                3.

              	
                The
                  amount of the annual Elective Contributions (or Phantom Contributions) to
                  the Retirement Income Trust Fund (or Accrued Benefit Account) has
                  been
                  based on the annual interest-adjusted accounting accruals which
                  would be
                  required of the Bank through the earlier of the Director’s death or
                  Benefit Age, (i) pursuant to APB Opinion No. 12, as amended by
                  FAS 106 and
                  (ii) assuming a discount rate equal to ten percent (10%) per annum,
                  in
                  order to provide a portion of the unfunded, non-qualified Supplemental
                  Retirement Income Benefit. Director has elected a monthly, pre-tax
                  deferral of board fees, committee fess and/or retainer in the amount
                  of
                  $1,603
                  per month ending January 2006.

              


      

      


      
        	
                4.
                  

              	
                For
                  purposes of this Agreement, and benefit calculations under this
                  Agreement,
                  future increases in Board Fees after 2006 will be limited to the
                  actual
                  increase or four percent (4%), whichever is
                  less.

              


      

      


      


      


      Exhibit
        A


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      


      
        	
                5.

              	
                Supplemental
                  Retirement Income Benefit means an actuarially determined annual
                  amount
                  equal to One Hundred and Thirty-Eight Thousand Nine Hundred and
                  Twelve
                  Dollars ($138,912) at age 65 if paid entirely from the Accrued
                  Benefit
                  Account or Eighty-Eight Thousand Nine Hundred and Four Dollars
                  ($88,904)
                  at age 65 if paid from the Retirement Income Trust
                  Fund.

              


      

      


      The
        Supplemental Retirement Income Benefit:

      


      
        	 	
                !

              	
                the
                  definition of Supplemental Retirement Income Benefit has been incorporated
                  into the Agreement for the sole purpose of actuarially establishing
                  the
                  amount of annual Contributions (or Phantom Contributions) to the
                  Retirement Income Trust Fund (or Accrued Benefit Account). The
                  amount of
                  any actual retirement, pre-retirement or disability benefit payable
                  pursuant to the Agreement will be a function of (i) the amount
                  and timing
                  of Contributions (or Phantom Contributions) to the Retirement Income
                  Trust
                  Fund (or Accrued Benefit Account) and (ii) the actual investment
                  experience of such Contributions (or the monthly compounding rate
                  of
                  Phantom Contributions). 

              


      

      


      


      6.
         Schedule
        of Annual Gross Contributions/Phantom Contributions

      


      
        	
                Plan
                  Year

              	 	
                Elective
                  Contributions

              	
                Emeritus
                  Contributions

              	
                Total
                  Contributions

              
	
                2004

              	 	
                $

              	
                188,713

              	 	
                $

              	
                23,130

              	 	
                $

              	
                211,843

              	 
	
                2005

              	 	 	
                40,071

              	 	 	
                6,951

              	 	 	
                47,022

              	 
	
                2006

              	 	 	
                25,728

              	 	 	
                7,720

              	 	 	
                33,448

              	 
	
                2007

              	 	 	
                26,651

              	 	 	
                8,558

              	 	 	
                35,209

              	 
	
                2008

              	 	 	
                29,441

              	 	 	
                9,470

              	 	 	
                38,911

              	 
	
                2009

              	 	 	
                32,524

              	 	 	
                10,462

              	 	 	
                42,986

              	 
	
                2010

              	 	 	
                35,930

              	 	 	
                11,540

              	 	 	
                47,470

              	 
	
                2011

              	 	 	
                39,692

              	 	 	
                12,711

              	 	 	
                52,403

              	 
	
                2012

              	 	 	
                43,849

              	 	 	
                13,983

              	 	 	
                57,832

              	 
	
                2013

              	 	 	
                48,440

              	 	 	
                15,364

              	 	 	
                63,804

              	 
	
                2014

              	 	 	
                53,512

              	 	 	
                16,861

              	 	 	
                70,373

              	 
	
                2015

              	 	 	
                59,116

              	 	 	
                18,485

              	 	 	
                77,601

              	 
	
                2016

              	 	 	
                65,306

              	 	 	
                20,245

              	 	 	
                85,551

              	 
	
                2017

              	 	 	
                72,145

              	 	 	
                22,152

              	 	 	
                94,297

              	 
	
                2018

              	 	 	
                79,699

              	 	 	
                24,217

              	 	 	
                103,916

              	 
	
                2019

              	 	 	
                87,240

              	 	 	
                21,032

              	 	 	
                108,272

              	 
	 	 	 	 	 	 	 	 	 	 	 


      

      


      
 

      


      


      


      Exhibit
        A
        - Cont=d.


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

 

      RESTATED

      DIRECTOR
        SUPPLEMENTAL RETIREMENT INCOME and 

      DEFERRED
        COMPENSATION AGREEMENT 

      BENEFICIARY
        DESIGNATION

      


      The
        Director, under the terms of the Restated Director Supplemental Retirement
        Income and Deferred Compensation Agreement executed by the Bank, dated the
        1st
        day of February, 2004, as amended and restated effective January 1, 2006,
        hereby
        designates the following Beneficiary(ies) to receive any guaranteed payments
        or
        death benefits under such Agreement, following his death:

      


      


      
        	
                PRIMARY
                  BENEFICIARY: 

              	 
	 	 
	
                SECONDARY
                  BENEFICIARY: 

              	 


      

      


      


      This
        Beneficiary Designation hereby revokes any prior Beneficiary Designation
        which
        may have been in effect.

      


      Such
        Beneficiary Designation is revocable.

      


      


      DATE:
        ______________________, 20__

      


      
        	 	 	 
	 	 	 
	
                WITNESS

              	 	
                DIRECTOR

              


      

      


      


      


      


      Exhibit
        B


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      


      RESTATED

      DIRECTOR
        SUPPLEMENTAL RETIREMENT INCOME and 

      DEFERRED
        COMPENSATION AGREEMENT

      NOTICE
        OF ELECTION TO CHANGE FORM OF PAYMENT

      


      
        	
                TO:

              	
                Bank

              
	 	
                Attention:

              


      

      


      


      I
        hereby
        give notice of my election to change the form of payment of my Supplemental
        Retirement Income Benefit, as specified below. I
        understand that such notice, in
        order to be effective, must be submitted in accordance with the time
        requirements described in Subsection 1.27 of my Restated Director Supplemental
        Retirement Income and Deferred Compensation Agreement. 

      


      
        	 	
                G

              	
                I
                  hereby elect to change the form of payment of my benefits from
                  monthly
                  installments throughout my Payout Period to a lump sum benefit
                  payment.

              


      

      


      
        	 	
                G

              	
                I
                  hereby elect to change the form of payment of my benefits from
                  a lump sum
                  benefit payment to monthly installments throughout my Payout Period.
                  Such
                  election hereby revokes my previous notice of election to receive
                  a lump
                  sum form of benefit payments.

              


      

      


      
        	 	 	 	 
	 	 	 
	 	
                DIRECTOR

              	 	 
	 	 	 	 
	 	 	 
	 	
                DATE

              	 	 
	 	 	 	 
	 	
                ACKNOWLEDGED

              	 
	 	
                BY:

              	 	 
	 	 	 	 
	 	
                TITLE:

              	 	 
	
                 

              	 	 
	 	
                DATE

              	 	 


      

      


      Exhibit
        C


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      


      RESTATED

      DIRECTOR
        SUPPLEMENTAL RETIREMENT INCOME and

      DEFERRED
        COMPENSATION AGREEMENT

      NOTICE
        OF ADJUSTMENT OF ELECTIVE CONTRIBUTION

      


      


      
        	
                TO:

              	
                Bank

              
	 	
                Attention:

              


      

      


      


      I
        hereby
        give notice of my election to adjust the amount of my Elective Contribution
        in
        accordance with my Restated Director Supplemental Retirement Income and Deferred
        Compensation Agreement, dated the 1st
        day of
        February, 2004, as amended and restated effective January 1, 2006. This notice
        is submitted thirty (30) days prior to January 1st, and shall become effective
        January 1st, as specified below.

       

      
        	
                Adjust
                  deferral as of:

              	
                January
                  1st, 2___

              
	 	 
	 	 
	
                Previous
                  Deferral Amount 

              	
                ____________
                  per month

              
	
                New
                  Deferral Amount 

              	
                ____________
                  per month

              
	 	
                (to
                  discontinue deferral, enter $0)

              


      

      


      


      
        	 	 	 
	 	
                DIRECTOR

              	 
	 	 	 
	 	 	 
	 	
                DATE

              	 
	 	 	 
	 	 	 
	 	 	 
	 	
                ACKNOWLEDGED
                  BY

              	 
	 	 	 
	 	 	 
	 	
                TITLE

              	 
	 	 	 
	 	 	 
	 	
                DATE

              	 


      

      


      


      Exhibit
        D