exv10w3



 





Exhibit 10.3




FORM OF

FIRST FEDERAL SAVINGS BANK

EMPLOYEE STOCK OWNERSHIP PLAN




Effective as of January 1, 2005




 









 





FORM OF

FIRST FEDERAL SAVINGS BANK

EMPLOYEE STOCK OWNERSHIP PLAN

CERTIFICATION




     I                     , President and Chief Executive Officer of First Federal
Savings Bank hereby certify that the attached First Federal Savings Bank
Employee Stock Ownership Plan, effective January 1, 2005, was adopted at a duly
held meeting of the Board of Directors of the Bank.



	 	 	 	 	 
	ATTEST:	 	FIRST FEDERAL SAVINGS BANK
	 
	 	 	 	 
	


	 	By:	 	 
	

	 	 	 	

	

	 	 	 	Peter D. Griffith
	

	 	 	 	President and Chief Executive Officer
	

	 	Date:	 	 
	

	 	 	 	








 









 





First Federal Savings Bank

Employee Stock Ownership Plan




Table of Contents




	 	 	 	 	 
	Section 1 - Introduction
	 	 	1	 
	Section 2 - Definitions
	 	 	1	 
	Section 3 - Eligibility and Participation
	 	 	8	 
	Section 4 - Contributions
	 	 	10	 
	Section 5 - Plan Accounting
	 	 	12	 
	Section 6 - Vesting and Forfeitures
	 	 	18	 
	Section 7 - Distributions
	 	 	20	 
	Section 8 - Voting of Company Stock and Tender Offers
	 	 	25	 
	Section 9 - The Committee and Plan Administration
	 	 	26	 
	Section 10 - Rules Governing Benefit Claims
	 	 	29	 
	Section 11 - The Trust
	 	 	30	 
	Section 12 - Adoption, Amendment and Termination
	 	 	31	 
	Section 13 - General Provisions
	 	 	33	 
	Section 14 - Top-Heavy Provisions
	 	 	34	 







 









 





SECTION 1

Introduction




Section 1.01 Nature of the Plan.




Effective as of January 1, 2005 (the “Effective Date”), First Federal Savings
Bank (the “Bank”) hereby establishes the First Federal Savings Bank Employee
Stock Ownership Plan (the “Plan”) to enable Eligible Employees (as defined in
Section 2.01(o) of the Plan) to acquire stock ownership interests in FedFirst
Financial Corporation (the “Company”), the holding company of the Bank. The
Bank intends this Plan to be a tax-qualified stock bonus plan under Section
401(a) of the Internal Revenue Code of 1986, as amended (the “Code”), and an
employee stock ownership plan within the meaning of Section 407(d)(6) of the
Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and
Sections 409 and 4975(e)(7) of the Code. The Plan is designed to invest
primarily in the common stock of the Company, which stock constitutes
“qualifying employer securities” within the meaning of Section 407(d)(5) of
ERISA and Sections 409(l) and 4975(e)(8) of the Code. Accordingly, the Plan
and Trust Agreement (as defined in Section 2.01(mm) of the Plan) shall be
interpreted and applied in a manner consistent with the Bank’s intent for it to
be a tax-qualified plan designed to invest primarily in qualifying employer
securities.




The Plan reflects certain provisions of the Economic Growth and Tax Relief
Reconciliation Act of 2001 (“EGTRRA”). The provisions related to EGTRRA are
intended as good faith compliance with EGTRRA and the guidance issued
thereunder. To the extent any provision of the Plan was operated according to
an effective date earlier than as required by law, then such date shall be the
effective date with respect to that provision of the Plan.




Section 1.02 Employers and Affiliates.




The Bank and each of its Affiliates (as defined in Section 2.01(c) of the Plan)
that, with
the consent of the Bank, adopt the Plan pursuant to the provisions of Section
12.01 of the Plan are collectively referred to as the “Employers” and
individually as an “Employer.” The Plan shall be treated as a single plan with
respect to all participating Employers.




SECTION 2

Definitions




Section 2.01 Definitions.




In this Plan, whenever the context so indicates, the singular or the plural
number and the masculine or feminine gender shall be deemed to include the
other, the terms “he,” “his,” and “him,” shall refer to a Participant or
Beneficiary, as the case may be, and, except as otherwise provided, or unless
the context otherwise requires, the capitalized terms shall have the following
meanings:





	(a)	 	“Account” or “Accounts” mean a Participant’s or Beneficiary’s Company
Stock Account and/or his Other Investments Account, as the context so
requires.




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	(b)	 	“Acquisition Loan” means a loan or other extension of credit, including
an installment obligation to a “party in interest” (as defined in Section
3(14) of ERISA) incurred by the Trustee in connection with the purchase of
Company Stock.
	 
	(c)	 	“Affiliate” means any corporation, trade or business, which, at the time
of reference, is together with the Bank, a member of a controlled group of
corporations, a group of trades or businesses (whether or not
incorporated) under common control, or an affiliated service group, as
described in Sections 414(b), 414(c), and 414(m) of the Code,
respectively, or any other organization treated as a single employer with
the Bank under Section 414(o) of the Code; provided, however, that, where
the context so requires, the term “Affiliate” shall be construed to give
full effect to the provisions of Sections 409(l)(4) and 415(h) of the
Code.
	 
	(d)	 	“Bank” means First Federal Savings Bank, and any entity that succeeds to
the business of the First Federal Savings Bank and adopts this Plan in
accordance with the provisions of Section 12.02 of the Plan, or by written
agreement assumes the obligations of the Plan.
	 
	(e)	 	“Beneficiary” means the person(s) entitled to receive benefits under the
Plan following a Participant’s death, pursuant to Section 7.03 of the
Plan.
	 
	(f)	 	“Change in Control” means any one of the following events occurs:






	(i)	 	Merger: The Company merges into or consolidates with
another corporation, or merges another corporation into the Company,
and as a result less than a majority of the combined voting power of
the resulting corporation immediately after the merger or
consolidation is held by persons who were stockholders of the
Company immediately before the merger or consolidation;
	 
	(ii)	 	Acquisition of Significant Share Ownership: The
Company files, or is required to file, a report on Schedule 13D or
another form or schedule (other than Schedule 13G) required under
Sections 13(d) or 14(d) of the Securities Exchange Act of 1934, if
the schedule discloses that the filing person or persons acting in
concert has or have become the beneficial owner of 25% or more of a
class of the Company’s voting securities, but this clause (b) shall
not apply to beneficial ownership of Company voting shares held in a
fiduciary capacity by an entity of which the Company directly or
indirectly beneficially owns 50% or more of its outstanding voting
securities;
	 
	(iii)	 	Change in Board Composition: During any period of
two consecutive years, individuals who constitute the Company’s
Board of Directors at the beginning of the two-year period cease for
any reason to constitute at least a majority of the Company’s Board
of Directors; provided, however, that for purposes of this clause
(iii), each director who is first elected by the board (or first
nominated by the board for election by the stockholders) by a vote
of at least two-thirds (2/3) of




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	 	 	the directors who were directors at the beginning of the two-year
period shall be deemed to have also been a director at the
beginning of such period; or
	 
	(iv)	 	Sale of Assets: The Company sells to a third party
all or substantially all of its assets.






	(g)	 	“Code” means the Internal Revenue Code of 1986, as amended.
	 
	(h)	 	“Committee” means the individual(s) responsible for the administration of
the Plan in accordance with Section 9 of the Plan.
	 
	(i)	 	“Company” means FedFirst Financial Corporation and any entity which
succeeds to the business of FedFirst Financial Corporation.
	 
	(j)	 	“Company Stock” means shares of the voting common stock or preferred
stock, meeting the requirements of Section 409 of the Code and Section
407(d)(5) of ERISA, issued by the Company or its Affiliates.
	 
	(k)	 	“Company Stock Account” means the account established and maintained in
the name of each Participant or Beneficiary to reflect his share of the
Trust Fund invested in Company Stock.
	 
	(l)	 	“Compensation” means:





(i) an Employee’s base salary, bonus and commissions paid during the Plan
Year.



(ii) Compensation shall also include the amounts of any Employer
contributions made pursuant to a salary reduction agreement entered into
by the Participant and not includible in the gross income of the employee
under Sections 125, 132(f), 402(e)(3), 402(h), 403(b), 414(h) or 457 of
the Code.



A Participant’s Compensation shall not exceed $200,000 (as
periodically adjusted pursuant to Section 401(a)(17) of the Code). If
the Plan Year for which a Participant’s Compensation is measured is less
than twelve (12) calendar months, then the amount of Compensation taken
into account for such Plan Year shall be the adjusted amount for such
Plan Year, as prescribed by the Secretary of the Treasury under Section
401(a)(17) of the Code, multiplied by a fraction, the numerator of which
is the number of months taken into account for such Plan Year and the
denominator of which is twelve (12). In determining the dollar
limitation hereunder, Compensation received from an Affiliate shall be
recognized as Compensation.




	(m)	 	“Disability” means a physical or mental condition of a Participant
resulting from bodily injury, disease, or mental disorder which renders
the Participant incapable of continuing any gainful occupation and which
condition constitutes total disability under the federal Social Security
Act. The Disability of a Participant shall be determined by the Plan
Administrator, in its sole discretion.




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	(n)	 	“Effective Date” means January 1, 2005.






	(o)	 	“Eligible Employee” means any Employee who is not precluded from
participating in the Plan by reason of the provisions of Section 3.02 of
the Plan.
	 
	(p)	 	"Employee” means any person who is actually performing services for the
Employer or an Affiliate in a common-law, employer-employee relationship
as determined under Sections 31.3121(d)-1, 31.3306(i)-1, or 31.3401(c)-1
of the Treasury Regulations and any “Leased Employee” as defined in
Section 3.02(b) of this Plan.
	 
	(q)	 	“Employer” or “Employers” means the Bank and any of its Affiliates that
adopt the Plan in accordance with the provisions of Section 12.01 of the
Plan, and any entity which succeeds to the business of the Bank or its
Affiliates and which adopts the Plan in accordance with the provisions of
Section 12.02 of the Plan, or by written agreement assumes the obligations
under the Plan.
	 
	(r)	 	“Entry Date” means the first day of the month following the date the
Employee satisfies the requirements for participation under Section 3.01
of the Plan.
	 
	(s)	 	“ERISA” means the Employee Retirement Income Security Act of 1974, as
amended.
	 
	(t)	 	“Exchange Act” means the Securities Exchange Act of 1934, as amended.
	 
	(u)	 	“Financed Shares” means shares of Company Stock acquired by the Trustee
with the proceeds of an Acquisition Loan, which shall constitute
“qualifying employer securities” under Section 409(l) of the Code and any
shares of Company Stock received upon conversion or exchange of such
shares.
	 
	(v)	 	“Highly Compensated Employee” means an Employee who, for a particular
Plan Year, satisfies one of the following conditions:






	(i)	 	was a “5-percent owner” (as defined in Section 414(q)(2) of
the Code) during the year or the preceding year, or
	 
	(ii)	 	for the preceding year, had “compensation” (as defined in
Section 414(q)(4) of the Code) from the Bank and its Affiliates
exceeding $90,000 (as periodically adjusted pursuant to Section
414(q)(1) of the Code).






	(w)	 	“Hours of Service” means:






	(i)	 	Each hour for which an Employee is paid, or entitled to
payment, for performing duties for the Employer during the
applicable computation period.
	 
	(ii)	 	Each hour for which an Employee is paid, or entitled to
payment, for a period during which no duties are performed
(irrespective of whether the employment




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	 	 	relationship has terminated) due to vacation, holiday, illness,
incapacity (including disability), layoff, jury duty, military duty
or leave of absence. Notwithstanding the preceding sentence, no
credit shall be given to the Employee for:






	(A)	 	more than 501 hours under this clause (ii)
because of any single continuous period in which the Employee
performs no duties (whether or not such period occurs in a
single computation period);
	 
	(B)	 	an hour for which the Employee is directly or
indirectly paid, or entitled to payment, because of a period
in which no duties are performed if such payment is made or
due under a plan maintained solely for the purpose of
complying with applicable worker’s or workmen’s compensation,
unemployment, or disability insurance laws; or
	 
	(C)	 	an hour or a payment which solely reimburses the
Employee for medical or medically-related expenses incurred by
the Employee.






	(iii)	 	Each hour for which back pay, irrespective of mitigation of
damages, is either awarded or agreed to by the Employer; provided,
however, that hours credited under either clause (i) or (ii) above
shall not also be credited under this clause (iii). Crediting of
hours for back pay awarded or agreed to with respect to periods
described in clause (ii) above will be subject to the limitations
set forth in that clause.





The crediting of Hours of Service shall be determined by the Committee in
accordance with the rules set forth in Section 2530.200b-2 of the regulations
prescribed by the Department of Labor, which rules shall be consistently
applied with respect to all Employees within the same job classification. If
an Employer finds it impracticable to count actual Hours of Service for any
class or group of non-hourly Employees, each Employee in that class or group
shall be credited with 45 Hours of Service for each weekly period in which he
has at least one Hour of Service. However, an Employee shall be credited with
Hours of Service only for his normal working hours during a paid absence.
Hours of Service shall be credited for employment with an Affiliate.




For purposes of determining whether an Employee has incurred a One Year Break
in Service and for vesting and participation purposes, if an Employee begins a
maternity/paternity leave of absence described in Section 411(a)(6)(E)(i) of
the Code, his Hours of Service shall include the Hours of Service that would
have been credited to him if he had not been so absent (or 45 Hours of Service
for each week of such absence if the actual Hours of Service cannot be
determined). An Employee shall be credited for such Hours of Service (up to a
maximum of 501 Hours of Service) in the Plan Year in which his absence begins
(if such crediting will prevent him from incurring a One Year Break in Service
in such Plan Year) or, in all other cases, in the following Plan Year. An
absence from employment for maternity or paternity reasons means an absence:





	(i)	 	by reason of pregnancy of the Employee,




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	(ii)	 	by reason of the birth of a child of the Employee,
	 
	(iii)	 	by reason of the placement of a child with the Employee in
connection with the adoption of such child by such Employee, or
	 
	(iv)	 	for purposes of caring for such child for a period beginning
immediately following such birth or placement.






	(x)	 	“Later Retirement Date” means the first day of the month coincident with
or next following a Participant’s date of actual retirement which occurs
after his Normal Retirement Date.
	 
	(y)	 	“Loan Suspense Account” means that portion of the Trust Fund consisting
of Company Stock acquired with an Acquisition Loan which has not yet been
allocated to the Participants’ Accounts.
	 
	(z)	 	“Normal Retirement Age” means attainment of age 65.






	(aa)	 	“Normal Retirement Date” means the first day of the month coincident with
or next following the Participant’s attainment of Normal Retirement Age.
	 
	(bb)	 	“One Year Break in Service” means a twelve (12) consecutive month period
during which the Participant does not complete more than 500 Hours of
Service.
	 
	(cc)	 	“Other Investments Account” means the account established and maintained
in the name of each Participant or Beneficiary to reflect his share of the
Trust Fund, other than Company Stock.
	 
	(dd)	 	“Participant” means any Eligible Employee who has become a Participant in
accordance with Section 3.01 of the Plan or any other person with an
Account balance under the Plan.
	 
	(ee)	 	“Plan” means First Federal Savings Bank Employee Stock Ownership Plan, as
amended from time to time.
	 
	(ff)	 	"Plan Year” means the calendar year.
	 
	(gg)	 	“Recognized Absence” means a period for which:






	(i)	 	an Employer grants an Employee a leave of absence for a
limited period of time, but only if an Employer grants such leaves
of absence on a nondiscriminatory basis to all Eligible Employees;
or
	 
	(ii)	 	an Employee is temporarily laid off by an Employer because of
a change in the business conditions of the Employer; or




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	(iii)	 	an Employee is on active military duty, but only to the
extent that his employment rights are protected by the Military
Selective Service Act of 1967 and the Uniformed Services Employment
and Reemployment Rights Act of 1994.






	(hh)	 	“Retirement Date” means a Participant’s Normal or Later Retirement Date,
whichever is applicable.
	 
	(ii)	 	“Service” means employment with the Bank or an Affiliate.
	 
	(jj)	 	“Termination of Service” means the earlier of (a) the date on which an
Employee’s Service is terminated by reason of his resignation, retirement,
discharge, death or Disability or (b) the first anniversary of the date on
which such Employee’s service is terminated for disability of a short-term
nature or any other reason. Service in the Armed Forces of the United
States shall not constitute a Termination of Service but shall be
considered to be a period of employment by the Employer provided (i) such
military service is caused by war or other emergency or the Employee is
required to serve under the laws of conscription in time of peace, (ii)
the Employee returns to employment with the Employer within six (6) months
following discharge from such military service and (iii) such Employee is
reemployed by the Employer at a time when the Employee had a right to
reemployment at his former position or substantially similar position upon
separation from such military duty in accordance with seniority rights as
protected under the laws of the United States. A leave of absence granted
to an Employee by the Employer shall not constitute a Termination of
Service provided that the Participant returns to the active service of the
Employer at the expiration of any such period for which leave has been
granted. Notwithstanding the foregoing, an Employee who is absent from
service with the Employer beyond the first anniversary of the first date
of his absence for maternity or paternity reasons set forth in Section
2.01 of the Plan shall incur a Termination of Service for purposes of the
Plan on the second anniversary of the date of such absence.
	 
	(kk)	 	“Treasury Regulations” mean the regulations promulgated by the Department
of the Treasury under the Code.
	 
	(ll)	 	“Trust” means the First Federal Savings Bank Employee Stock Ownership
Plan Trust created in connection with the establishment of the Plan.
	 
	(mm)	 	“Trust Agreement” means the trust agreement establishing the Trust.
	 
	(nn)	 	“Trust Fund” means the assets held in the Trust for the benefit of
Participants and their Beneficiaries.
	 
	(oo)	 	“Trustee” means the trustee or trustees from time to time in office under
the Trust Agreement.




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	(pp)	 	“Valuation Date” means the last day of the Plan Year and each other date
as of which the Committee shall determine the investment experience of the
Trust Fund and adjust Participants’ Accounts accordingly.
	 
	(qq)	 	“Valuation Period” means the period following a Valuation Date and ending
with the next Valuation Date.
	 
	(rr)	 	“Year of Service” shall mean a Plan Year in which an Employee is credited
with at least 1,000 Hours of Service.





SECTION 3

Eligibility and Participation




     Section 3.01 Participation.




	(a)	 	All Eligible Employees who are eligible to participate in the Bank’s
401(k) Plan on the date the Company first issues common stock pursuant to
its reorganization from a mutual savings and loan association to a mutual
holding company (the “Reorganization Date”) shall enter the Plan and
become Participants on the earlier of the Effective Date or the date on
which the Eligible Employee first performed an Hour of Service for an
Employer.
	 
	(b)	 	An Eligible Employee who is first employed by an Employer after the
Reorganization Date shall become a Participant in the Plan upon satisfying
the following requirements:






	(i)	 	The Eligible Employee is at least 21 years of age; and
	 
	(ii)	 	completes one Year of Service.






	(c)	 	An Eligible Employee who has satisfied the eligibility requirements of
Section 3.01(b) shall enter the Plan and become a Participant on the
earlier of the Effective Date or the Entry Date coincident with or next
following the date he satisfies such requirements.





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Section 3.02 Certain Employees Ineligible.




The following Employees are ineligible to participate in the Plan:





	(a)	 	Employees covered by a collective bargaining agreement between the
Employer and the Employee’s collective bargaining representative if:






	(i)	 	retirement benefits have been the subject of good faith
bargaining between the Employer and the representative, and
	 
	(ii)	 	the collective bargaining agreement does not expressly
provide that Employees of such unit be covered under the Plan;






	(b)	 	Employees who are nonresident aliens and who receive no earned income
from an Employer which constitutes income from sources within the United
States; and
	 
	(c)	 	Employees of an Affiliate of the Bank that has not adopted the Plan
pursuant to Sections
12.01 or 12.02 of the Plan.
	 
	(d)	 	Seasonal employees.





Section 3.03 Transfer to and from Eligible Employment.





	(a)	 	If an Employee ineligible to participate in the Plan by reason of Section
3.02 of the Plan transfers to employment as an Eligible Employee, he shall
enter the Plan as of the later of:






	(i)	 	the first Entry Date after the date of transfer, or
	 
	(ii)	 	the first Entry Date on which he could have become a
Participant pursuant to Section 3.01 of the Plan.






	(b)	 	If a Participant transfers to an employment position that makes him
ineligible to participate in the Plan as of the date of such transfer, he
shall cease active participation in the Plan as of such date and his
transfer shall be treated for all purposes under the Plan in the same
manner as any other termination of Service.





Section 3.04 Participation after Reemployment.





	(a)	 	If an Employee incurs a One Year Break in Service prior to satisfying the
eligibility requirements of Section 3.01 of the Plan, Service prior to
such One Year Break in Service shall be disregarded and the Employee must
satisfy the eligibility requirements of Section 3.01 as a new Employee.




9









 






	(b)	 	If an Employee incurs a One Year Break in Service after satisfying the
eligibility requirements of Section 3.01 of the Plan and again performs an
Hour of Service, the Employee shall receive credit for Service prior to
his One Year Break in Service and shall be eligible to participate in the
Plan immediately upon reemployment, provided the Employee is not excluded
from participation under the provisions of Section 3.02 of the Plan.





Section 3.05 Participation Not Guarantee of Employment.




Participation in the Plan does not constitute a guarantee or contract of
employment and will not give any Employee the right to be retained in the
employ of the Bank or any of its Affiliates nor any right or claim to any
benefit under the terms of the Plan unless such right or claim has specifically
accrued under the Plan.




SECTION 4

Contributions




Section 4.01 Employer Contributions.





	(a)	 	Discretionary Contributions. Each Plan Year, each Employer, in its
discretion, may make a contribution to the Trust. Each Employer making a
contribution for any Plan Year under this Section 4.01(a) will contribute
to the Trustee cash equal to, or Company Stock or other property having an
aggregate fair market value equal to, such amount as the Board of
Directors of the Employer shall determine by resolution. Notwithstanding
the Employer’s discretion with respect to the medium of contribution, an
Employer shall not make a contribution in any medium which would make such
contribution a prohibited transaction (for which no exemption is provided)
under Section 406 of ERISA or Section 4975 of the Code.
	 
	(b)	 	Employer Contributions for Acquisition Loans. Each Plan Year, the
Employers shall, subject to any regulatory prohibitions, contribute an
amount of cash sufficient to enable the Trustee to discharge any
indebtedness incurred with respect to an Acquisition Loan pursuant to the
terms of the Acquisition Loan. The Employers’ obligation to make
contributions under this Section 4.01(b) shall be reduced to the extent of
any investment earnings attributable to such contributions and any cash
dividends paid with respect to Company Stock held by the Trustee in the
Loan Suspense Account. If there is more than one Acquisition Loan, the
Employers shall designate the one to which any contribution pursuant to
this Section 4.01(b) is to be applied.





Section 4.02 Limitations on Contributions.




In no event shall an Employer’s contribution(s) made under Section 4.01 of the
Plan for any Plan Year exceed the lesser of:





	(a)	 	The maximum amount deductible under Section 404 of the Code by that
Employer as an expense for Federal income tax purposes; and




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	(b)	 	The maximum amount which can be credited for that Plan Year in accordance
with the allocation limitation provisions of Section 5.05 of the Plan.





Section 4.03 Acquisition Loans.




The Trustee may incur Acquisition Loans from time to time to finance the
acquisition of Company Stock for the Trust or to repay a prior Acquisition
Loan. An Acquisition Loan shall be for a specific term, shall bear a
reasonable rate of interest, shall not be payable in demand, except in the
event of default, and shall be primarily for the benefit of Participants and
Beneficiaries of the Plan. An Acquisition Loan may be secured by a collateral
pledge of the Financed Shares so acquired and any other Plan assets which are
permissible securities within the provisions of Section 54.4975-7(b) of the
Treasury Regulations. No other assets of the Plan or Trust may be pledged as
collateral for an Acquisition Loan, and no lender shall have recourse against
any other Trust assets. Any pledge of Financed Shares must provide for the
release of shares so pledged on a basis equal to the principal and interest (or
if the requirements of Section 54.4975-7(b)(8)(ii) of the Treasury Regulations
are met and the Employer so elects, principal payments only), paid by the
Trustee on the Acquisition Loan. The released Financed Shares shall be
allocated to Participants’ Accounts in accordance with the provisions of
Sections 5.04 or 5.08 of the Plan, whichever is applicable. Payment of
principal and interest on any Acquisition Loan shall be made by the Trustee
only from the Employer contributions paid in cash to enable the Trustee to
repay such loan in accordance with Section 4.01(b) of the Plan, from earnings
attributable to such contributions, and any cash dividends received by the
Trustee on Financed Shares acquired with the proceeds of the Acquisition Loan
(including contributions, earnings and dividends received during or prior to
the year of repayment less such payments in prior years), whether or not
allocated. Financed Shares shall initially be credited to the Loan Suspense
Account and shall be transferred for allocation to the Company Stock Accounts
of Participants only as payments of principal and interest (or, if the
requirements of Section 54.4975-7(b)(8)(ii) of the Treasury Regulations are met
and the Employer so elects, principal payments only), on the Acquisition Loan
are made by the Trustee. The number of Financed Shares to be released from the
Loan Suspense Account for allocation to Participants’ Company Stock Account for
each Plan Year shall be based on the ratio that the payments of principal and
interest (or, if the requirements of Section 54.4975-7(b)(8)(ii) of the
Treasury Regulations are met and the Employer so elects, principal payments
only), on the Acquisition Loan for that Plan Year bears to the sum of the
payments of principal and interest on the Acquisition Loan for that Plan Year
plus the total remaining payment of principal and interest projected (or, if
the requirements of Section 54.4975-7(b)(8)(ii) of the Treasury Regulations are
met and the Employer so elects, principal payments only), on the Acquisition
Loan over the duration of the Acquisition Loan repayment period, subject to the
provisions of Section 5.05 of the Plan.




Section 4.04 Conditions as to Contributions.




In addition to the provisions of Section 12.03 of the Plan for the return of an
Employer’s contributions in connection with a failure of the Plan to qualify
initially under the Code, any amount contributed by an Employer due to a good
faith mistake of fact, or based upon a good faith but erroneous determination
of its deductibility under Section 404 of the Code, shall be




11









 








returned to the
Employer within one year after the date on which the Employer originally made
such contribution, or within one year after its nondeductibility has been
finally determined. However, the amount to be returned shall be reduced to
take account of any adverse investment experience within the Trust in order
that the balance credited to each Participant Account is not less than it would
have been if the contribution had never been made by the Employer.




Section 4.05 Employee Contributions.




Employee contributions are neither required nor permitted under the Plan.




Section 4.06 Rollover Contributions.




Rollover contributions to the Plan of assets from other tax-qualified
retirement plans are not permitted under the Plan.




Section 4.07 Trustee-to-Trustee Transfers.




Trustee-to-trustee transfers of assets from other tax-qualified retirement
plans are not permitted under the Plan.




SECTION 5

Plan Accounting




Section 5.01 Accounting for Allocations.




The Committee shall establish the Accounts (and sub-accounts, if deemed
necessary) for each Participant, and the accounting procedures for the purpose
of making allocations to Participants’ Accounts as provided for in this Section
5. The Committee shall maintain adequate records of the cost basis of shares
of Company Stock allocated to each Participant’s Company Stock Account. The
Committee also shall keep separate records of Financed Shares attributable to
each Acquisition Loan and of contributions made by the Employers (and any
earnings thereon) made for the purpose of enabling the Trustee to repay any
Acquisition Loan. From time to time, the Committee may modify its accounting
procedures for the purpose of achieving equitable and nondiscriminatory
allocations among the Accounts of Participants, in accordance with the
provisions of this Section 5 and the applicable requirements of the Code and
ERISA. In accordance with Section 9 of the Plan, the Committee may delegate
the responsibility for maintaining Accounts and records.




Section 5.02 Maintenance of Participants’ Company Stock Accounts.




As of each Valuation Date, the Committee shall adjust the Company Stock Account
of each Participant to reflect activity during the Valuation Period as follows:





	(a)	 	First, charge to each Participant’s Company Stock Account all
distributions and payments made to the Participant that have not been
previously charged;




12









 












	(b)	 	Next, credit to each Participant’s Company Stock Account the shares of
Company Stock, if any, that have been purchased with amounts from the
Participant’s Other Investments Account, and adjust such Other Investments
Account in accordance with the provisions of Section 5.03 of the Plan;






	(c)	 	Next, credit to each Participant’s Company Stock Account the shares of
Company Stock representing contributions made by the Employers in the form
of Company Stock and the number of Financed Shares released from the Loan
Suspense Account under Section 4.03 of the Plan that are to be allocated
and credited as of that date in accordance with the provisions of Section
5.04 of the Plan; and






	(d)	 	Finally, credit to each Participant’s Company Stock Account the shares of
Company Stock released from the Loan Suspense Account that are to be
allocated in accordance with the provisions of Section 5.09 of the Plan.





Section 5.03 Maintenance of Participants’ Other Investments Accounts.




Except as otherwise provided for under Section 5.08 of the Plan, as of each
Valuation Date, the Committee shall adjust the Other Investments Account of
each Participant to reflect activity during the Valuation Period as follows:





	(a)	 	First, charge to each Participant’s Other Investments Account all
distributions and payments made to the Participant that have not
previously been charged;
	 
	(b)	 	Next, if Company Stock is purchased with assets from a Participant’s
Other Investments Account, charge the Participant’s Other Investments
Account accordingly;
	 
	(c)	 	Next, subject to the dividend provisions of Section 5.09 of the Plan,
credit to the Other Investments Account of each Participant any cash
dividends paid to the Trustee on shares of Company Stock held in that
Participant’s Company Stock Account (as of the record date for such cash
dividends) and dividends paid on shares of Company Stock held in the Loan
Suspense Account that have not been used to repay any Acquisition Loan.
Subject to the provisions of Section 5.09 of the Plan, cash dividends that
have not been used to repay any Acquisition Loan and have been credited to
a Participant’s Other Investments Account shall be applied by the Trustee
to purchase shares of Company Stock, which shares shall then be credited
to the Company Stock Account of such Participant. The Participant’s Other
Investments Account shall then be charged by the amount of cash used to
purchase such Company Stock. In addition, any earnings on:






	(i)	 	Participants’ Other Investments Accounts will be allocated to
Accounts, pro rata, based on Participants’ Other Investments Account
balances as of the first day of the Valuation Period, and
	 
	(ii)	 	the Loan Suspense Account, other than dividends used to repay
the Acquisition Loan, will be allocated to Participants’ Other
Investments Accounts, pro rata,




13









 






	 	 	based on their Other Investments
Account balances as of the first day of the Valuation Period;






	(d)	 	Next, allocate and credit the Employer contributions made pursuant to
Section 4.01(b) of the Plan for the purpose of repaying any Acquisition
Loan, in accordance with Section 5.04 of the Plan. Such amount shall then
be used to repay any Acquisition Loan and such Participant’s Other
Investments Account shall be charged accordingly; and
	 
	(e)	 	Finally, allocate and credit the Employer contributions (other than
amounts contributed to repay an Acquisition Loan) that are made in cash
(or property other than Company Stock) for the Plan Year to the Other
Investments Account of each Participant in accordance with Section 5.04 of
the Plan.





Section 5.04 Allocation and Crediting of Employer Contributions.





	(a)	 	Except as otherwise provided for in Sections 5.08 and 5.09 of the Plan,
as of the Valuation Date for each Plan Year:






	(i)	 	Company Stock released from the Loan Suspense Account for
that year and shares of Company Stock contributed directly to the
Plan shall be allocated and credited to each Active Participant’s
(as defined in paragraph (b) of this Section 5.04) Company Stock
Account based on the ratio that each Active Participant’s
Compensation bears to the aggregate Compensation of all Active
Participants for the Plan Year, and then
	 
	(ii)	 	The cash contributions not used to repay an Acquisition Loan
and any other property contributed for that year shall be allocated
and credited to each Active Participant’s Other Investments Account
based on the ratio determined by comparing each Active Participant’s
Compensation while a Participant to the aggregate Compensation of
all Active Participants for the Plan Year.






	(b)	 	For purposes of this Section 5.04, the term “Active Participant” means
those Eligible Employees who:






	(i)	 	are employed on the last day of the Plan Year and have
completed 1,000 Hours of Service during the Plan Year; or
	 
	(ii)	 	terminated employment during the Plan Year by reason of
death, Disability, or attainment of their Normal or Later Retirement
Date.





Section 5.05 Limitations on Allocations.





	(a)	 	In General. Subject to the provisions of this Section 5.05, Section 415
of the Code shall be incorporated by reference into the terms of the Plan.
No allocation shall be made under Section 5.04 of the Plan that would
result in a violation of Section 415 of the Code.




14









 






	(b)	 	Code Section 415 Compensation. For purposes of this Section 5.05,
Compensation shall be adjusted to reflect the general rule of Section
1.415-2(d) of the Treasury Regulations.
	 
	(c)	 	Limitation Year. The “limitation year” (within the meaning of Section
415 of the Code) shall be the calendar year.
	 
	(d)	 	Multiple Defined Contribution Plans. In any case where a Participant
also participates in another defined contribution plan of the Bank or its
Affiliates, the appropriate committee of such other plan shall first
reduce the after-tax contributions under any such plan, shall then reduce
any elective deferrals under any such plan subject to Section 401(k) of
the Code, shall then reduce all other contributions under any other such
plan and, if necessary, shall then reduce contributions under this Plan.
	 
	(e)	 	Excess Allocations. If, after applying the allocation provisions under
Section 5.04 of the Plan, allocations under Section 5.04 of the Plan would
otherwise result in a violation of Section 415 of the Code, the Committee
shall allocate and reallocate employer contributions to other Participants
in the Plan for the limitation year or, if such allocation and
reallocation causes the limitations of Section 415 of the Code to be
exceeded, shall hold excess amounts in an unallocated suspense account for
allocation in a subsequent Plan Year in accordance with Section
1.415-6(b)(6)(i) of the Treasury Regulations. Such suspense account, if
permitted, will be credited before any allocation of contributions for
subsequent limitation years.
	 
	(f)	 	Allocations Pursuant to Section 5.08. For purposes of this Section 5.05,
no amount credited to any Participant’s Account pursuant to Section 5.08
of the Plan shall be counted as an “annual addition” for purposes of
Section 415 of the Code. In the event any amount cannot be allocated to
Affected Participants (as defined in Section 5.08 of the Plan) under the
Plan pursuant to Section 5.08 of the Plan in the year of a Change in
Control, the amount which may not be so allocated in the year of the
Change in Control shall be treated in accordance with paragraph (e) of
this Section 5.05.





Section 5.06 Other Limitations.




Aside from the limitations set forth in Section 5.05 of the Plan, in no event
shall more than one-third of the Employer contributions to the Plan be
allocated to the Accounts of Highly Compensated Employees. In order to ensure
that such allocations are not made, the Committee shall, beginning with the
Participants whose Compensation exceeds the limit then in effect under Section
401(a)(17) of the Code, reduce the amount of Compensation of such Highly
Compensated Employees on a pro-rata basis per individual that would otherwise
be taken into account for purposes of allocating benefits under Section 5.04 of
the Plan. If, in order to satisfy this Section 5.06, any such Participant’s
Compensation must be reduced to an amount that is lower than the Compensation
amount of the next highest paid (based on such Participant’s Compensation)
Highly Compensated Employee (the “breakpoint amount”), then, for purposes of
allocating benefits under Section 5.04 of the Plan, the Compensation of all
concerned Participants shall be reduced to an amount not to exceed such
breakpoint amount.




15









 








Section 5.07 Limitations as to Certain Section 1042 Transactions.




To the extent that a shareholder of Company Stock sells qualifying Company
Stock to the Plan and elects (with the consent of the Bank) nonrecognition of
gain under Section 1042 of the Code, no portion of the Company Stock purchased
in such nonrecognition transaction (or other dividends or other income
attributable thereto) may accrue or be allocated during the nonallocation
period (the ten (10) year period beginning on the later of the date of the sale
of the qualified Company Stock, or the date of the Plan allocation attributable
to the final payment of an Acquisition Loan incurred in connection with such
sale) for the benefit of:





	(a)	 	the selling shareholder;
	 
	(b)	 	the spouse, brothers or sisters (whether by the whole or half blood),
ancestors or lineal descendants of the selling shareholder or descendant
referred to in (a) above; or
	 
	(c)	 	any other person who owns, after application of Section 318(a) of the
Code, more than twenty-five percent (25%) of:






	(i)	 	any class of outstanding stock of the Company or any
Affiliate, or
	 
	(ii)	 	the total value of any class of outstanding stock of the
Company or any Affiliate.





For purposes of this Section 5.07, Section 318(a) of the Code shall be applied
without regard to the employee trust exception of Section 318(a)(2)(B)(i) of
the Code.




Section 5.08 Allocations Upon Termination Prior to Satisfaction of
Acquisition Loan.





	(a)	 	Notwithstanding any other provision of the Plan, in the event of a Change
in Control, the Plan shall terminate as of the effective date of the
Change in Control and, as soon as practicable thereafter, the Trustee
shall repay in full any outstanding Acquisition Loan. In connection with
such repayment, the Trustee shall: (i) apply cash, if any, received by
the Plan in connection with the transaction constituting a Change in
Control, with respect to the unallocated shares of Company Stock acquired
with the proceeds of the Acquisition Loan, and (ii) to the extent
additionally required to effect the repayment of the Acquisition Loan,
obtain cash through the sale of any stock or security received by the Plan
in connection with such transaction, with respect to such unallocated shares
of Company Stock. After repayment of the Acquisition Loan, all
remaining shares of Company Stock held in the Loan Suspense Account, all
other stock or securities, and any cash proceeds from the sale or other
disposition of any shares of Company Stock held in the Loan Suspense
Account, shall be allocated among the Accounts of all Participants who
were employed by an Employer on the date immediately preceding the
effective date of the Change in Control. Such allocations of shares or
cash proceeds shall be credited as earnings for purposes of Section 5.05
of the Plan and Section 415 of the Code, as of the effective date of the
Change in Control, to the Account of each Participant who is either in
active Service with an Employer, or is on a Recognized Absence, on the
date immediately preceding the effective date of the Change of Control
(each an “Affected




16









 






	 	 	Participant”), in proportion to the opening balances in
their Company Stock Accounts as of the first day of the current Valuation
Period. As of the effective date of a Change in Control, all Participant
Accounts shall be fully vested and nonforfeitable.
	 
	(b)	 	In the event of a termination of the Plan in connection with a Change in
Control, this Section 5.08 shall have no force and effect unless the price
paid for the Company Stock in connection with a Change in Control is
greater than the average basis of the unallocated Company Stock held in
the Loan Suspense Account as of the date of the Change in Control.





Section 5.09 Dividends.





	(a)	 	Stock Dividends. Dividends on Company Stock which are received by the
Trustee in the form of additional Company Stock shall be retained in the
portion of the Trust Fund consisting of Company Stock, and shall be
allocated among the Participants’ Accounts and the Loan Suspense Account
in accordance with their holdings of the Company Stock on which the
dividends have been paid.
	 
	(b)	 	Cash Dividends on Allocated Shares. Dividends on Company Stock credited
to Participants’ Accounts which are received by the Trustee in the form of
cash shall, at the direction of the Bank, either:






	(i)	 	be credited to Participants’ Accounts in accordance with
Section 5.03 of the Plan and invested as part of the Trust Fund;
	 
	(ii)	 	be distributed immediately to the Participants;
	 
	(iii)	 	be distributed to the Participants within ninety (90) days
of the close of the Plan Year in which paid; or
	 
	(iv)	 	be used to repay principal and interest on the Acquisition
Loan used to acquire Company Stock on which the dividends were paid.





In addition to the alternatives specified in the preceding paragraph regarding
the treatment of cash dividends paid with respect to shares of Company Stock
credited to Participants’ Accounts, if authorized by the Committee for the Plan
Year, a Participant may elect that cash dividends paid on Company Stock
credited to the Participant’s Account shall either be:





	(i)	 	paid to the Plan, reinvested in Company Stock and credited to
the Participant’s Account;
	 
	(ii)	 	distributed in cash to the Participant; or
	 
	(iii)	 	distributed to the Participant within ninety (90) days of
the close of the Plan Year in which paid.




17









 











Dividends subject to an election under this paragraph (and any Company Stock
acquired therewith pursuant to a Participant’s election) shall at all times be
fully vested. To the extent the Committee authorizes dividend elections
pursuant to this paragraph, the Committee shall establish policies and
procedures relating to Participant elections and, if applicable, the
reinvestment of cash dividends in Company Stock, which are consistent with
guidance issued under Section 404(k) of the Code.





	(c)	 	Cash Dividends on Unallocated Shares. Dividends on Company Stock held in
the Loan Suspense Account received by the Trustee in the form of cash
shall be applied as soon as practicable to payments of principal and
interest under the Acquisition Loan incurred with the purchase of Company Stock.
	 
	(d)	 	Financed Shares. Financed Shares released from the Loan Suspense Account
by reason of dividends paid with respect to Company Stock shall be
allocated under Sections 5.03 and 5.04 of the Plan as follows:






	(i)	 	First, Financed Shares with a fair market value at least
equal to the dividends paid with respect to the Company Stock
allocated to Participants’ Accounts shall be allocated among and
credited to the Accounts of such Participants, pro rata, according
to the number of shares of Company Stock held in such accounts on
the date the dividend is declared by the Company; and
	 
	(ii)	 	Next, any remaining Financed Shares released from the Loan
Suspense Account by reason of dividends paid with respect to Company
Stock held in the Loan Suspense Account shall be allocated among and
credited to the Accounts of all Participants, pro rata, according to
each Participant’s Compensation.





SECTION 6

Vesting and Forfeitures




Section 6.01 Deferred Vesting in Accounts.





	(a)	 	A Participant shall vest in his Accounts in accordance with the following
schedule:





	 	 	 	 	 
	Years of Service	 	Vested Percentage
	One
	 	 	20	%
	Two
	 	 	40	%
	Three
	 	 	60	%
	Four
	 	 	80	%
	Five
	 	 	100	%








	(b)	 	For purposes of determining a Participant’s Years of Service under this
Section 6.01, a Participant must be credited employment with the Bank or
an Affiliate shall be deemed employment with the Employer. For purposes
of determining a Participant’s vested




18









 






	 	 	percentage in his Accounts, all Years of Service shall be included,
beginning with the Employee’s initial service with the Employer.





Section 6.02 Immediate Vesting in Certain Situations.





	(a)	 	Notwithstanding Section 6.01(a) of the Plan, a Participant shall become
fully vested in his Accounts upon the earlier of:






	(i)	 	termination of the Plan or upon the permanent and complete
discontinuance of contributions by the Employer to the Plan;
provided, however, that in the event of a partial termination of the
Plan, the interest of each Participant shall fully vest only with
respect to that part of the Plan which is terminated;
	 
	(ii)	 	Termination of Service on or after the Participant’s Normal
or Later Retirement Date;
	 
	(iii)	 	a Change in Control; or
	 
	(iv)	 	Termination of Service by reason of death or Disability.





Section 6.03 Treatment of Forfeitures.





	(a)	 	If a Participant who is not fully vested in his Accounts terminates
employment, that portion of his Accounts in which he is not vested shall
be forfeited upon the earlier of:






	(i)	 	the date the Participant receives a distribution of his
entire vested benefits under the Plan, or
	 
	(ii)	 	the date at which the Participant incurs five (5) consecutive
One Year Breaks in Service.






	(b)	 	If a Participant who has terminated employment and has received a
distribution of his entire vested benefits under the Plan is subsequently
reemployed by an Employer prior to incurring five (5) consecutive One Year
Breaks in Service, he shall have the portion of his Accounts which was
previously forfeited restored to his Accounts, provided he repays to the
Trustee within five (5) years of his subsequent employment date an amount
equal to the previous distribution. The amount restored to the
Participant’s Account shall be credited to his Account as of the last day
of the Plan Year in which the Participant repays the distributed amount to
the Trustee and the restored amount shall come from other Employees’
forfeitures and, if such forfeitures are insufficient, from a special
contribution by the Employer for that year. If a Participant’s employment
terminates prior to his Account having become vested, such Participant
shall be deemed to have received a distribution of his entire vested
interest as of the Valuation Date next following his termination of
employment.




19









 












	(c)	 	If a Participant who has terminated employment but has not received a
distribution of his entire vested benefits under the Plan is subsequently
reemployed by an Employer subsequent to incurring five (5) consecutive One
Year Breaks in Service, any undistributed balance of his Accounts from his
prior participation which was not forfeited shall be maintained as a fully
vested subaccount within his Account.






	(d)	 	If a portion of a Participant’s Account is forfeited, assets other than
Company Stock must be forfeited before any Company Stock may be forfeited.
	 
	(e)	 	Forfeitures shall be reallocated among the other Participants in the
Plan.





Section 6.04 Accounting for Forfeitures.




A forfeiture shall be charged to the Participant’s Account as of the first day
of the first Valuation Period in which the forfeiture becomes certain pursuant
to Section 6.03 of the Plan. Except as otherwise provided in Section 6.03 of
the Plan, a forfeiture shall be added to the contributions of the terminated
Participant’s Employer which are to be credited to other Participants pursuant
to Section 5 as of the last day of the Plan Year in which the forfeiture
becomes certain.




Section 6.05 Vesting Upon Reemployment.




If a Participant incurs a One Year Break in Service and again performs an Hour
of Service, such Participant shall receive credit, for purposes of Section 6.01
of the Plan, for his Years of Service prior to his One Year Break in Service.




SECTION 7

Distributions




Section 7.01 Distribution of Benefit Upon a Termination of Employment.





	(a)	 	A Participant whose employment terminates for any reason shall receive
the entire vested portion of his Accounts in a single payment on a date
selected by the Committee; provided, however, that such date shall be on
or before the 60th day after the end of the Plan Year in which the
Participant’s employment terminated. The benefits from that portion of
the Participant’s Other Investments Account shall be calculated on the
basis of the most recent Valuation Date before the date of payment.
Subject to the provisions of Section 7.05 of the Plan, if the Committee so
provides, a Participant may elect that his benefits be distributed to him
in the form of Company Stock, cash, or some combination thereof.
	 
	(b)	 	Notwithstanding paragraph (a) of this Section 7.01, if the balance
credited to a Participant’s Accounts exceeds, at the time such benefit was
distributable, $5,000, his benefits shall not be paid before the latest of
his 65th birthday or the tenth anniversary of the year in which he
commenced participation in the Plan, unless he elects an early payment
date in a written election filed with the Committee. Such an election is
not valid unless it is made after the Participant has received the
required notice under Section




20









 






	 	 	1.411(a)-11(c) of the Treasury Regulations
that provides a general description of the material features of a lump sum
distribution and the Participant’s right to defer receipt of his benefits
under the Plan. The notice shall be provided no less than 30 days and no
more than 90 days before the first day on which all events have occurred
which entitle the Participant to such benefit. Written consent of the Participant to the
distribution generally may not be made within 30 days of the date the
Participant receives the notice and shall not be made more than 90 days
from the date the Participant receives the notice. However, a
distribution may be made less than 30 days after the notice provided
under Section 1.411(a)-11(c) of the Treasury Regulations is given, if:






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





A Participant may modify such an election at any time, provided any new benefit
payment date is at least 30 days after a modified election is delivered to the
Committee.




Section 7.02 Minimum Distribution Requirements.




With respect to all Participants, other than those who are “5% owners” (as
defined in Section 416 of the Code), benefits shall be paid on the required
beginning date which is no later than the April 1st of the later of:





	(i)	 	the calendar year following the calendar year in which the
Participant attains age 70-1/2, or
	 
	(ii)	 	the calendar year in which the Participant retires.





With respect to all Participants who are 5% owners within the meaning of
Section 416 of the Code, such Participants’ benefits shall be paid no later
than the April 1st of the calendar year following the calendar year in which
the Participant attains age 70-1/2.




Section 7.03 Benefits on a Participant’s Death.





	(a)	 	If a Participant dies before his benefits are paid pursuant to Section
7.01 of the Plan, the balance credited to his Accounts shall be paid to
his Beneficiary in a single distribution on or before the 60th day after
the end of the Plan Year in which the Participant died. If the
Participant has not named a Beneficiary or his named Beneficiary should
not survive him, then the balance in his Accounts shall be paid to his
estate. The benefits from that portion of the Participant’s Other
Investments Account shall be calculated on the basis of the most recent
Valuation Date before the date of payment.
	 
	(b)	 	If a married Participant dies before his benefit payments begin, then,
unless he has specifically elected otherwise, the Committee shall cause
the balance in his Accounts to




21









 






	 	 	be paid to his spouse, as Beneficiary. A married Participant may name an
individual other than his spouse as Beneficiary provided that such election
is accompanied by the spouse’s written consent which must:






	(i)	 	acknowledge the effect of the election;
	 
	(ii)	 	explicitly provide either that the designated Beneficiary may
not subsequently be changed by the Participant without the spouse’s
further consent or that it may be changed without such consent; and
	 
	(iii)	 	must be witnessed by the Committee, its representative, or a
notary public.





This requirement shall not apply if the Participant establishes to the
Committee’s satisfaction that the spouse may not be located.





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





Section 7.04 Delay in Benefit Determination.




If the Committee is unable to determine the benefits payable to a Participant
or Beneficiary on or before the latest date prescribed for payment pursuant to
this Section 7, the benefits shall in any event be paid within 60 days after
they can first be determined.




Section 7.05 Options to Receive and Sell Company Stock.





	(a)	 	Unless ownership of virtually all Company Stock is restricted to active
Employees and qualified retirement plans for the benefit of Employees
pursuant to the certificates of incorporation or by-laws of the Employers
issuing Company Stock, a terminated Participant or the Beneficiary of a
deceased Participant may instruct the Committee to distribute the
Participant’s entire vested interest in his Accounts in the form of
Company Stock. In that event, the Committee shall apply the Participant’s
vested interest in his Other Investments Account to purchase sufficient
Company Stock to make the required distribution.
	 
	(b)	 	Any Participant who receives Company Stock pursuant to this Section 7.05,
and any person who has received Company Stock from the Plan or from such a
Participant by reason of the Participant’s death or incompetency, by reason
of divorce or separation from the Participant, or by reason of a rollover
distribution described in Section 402(c) of




22









 






	 	 	the Code, shall have the right to require the Employer which issued the
Company Stock to purchase the Company Stock for its current fair market
value (hereinafter referredto as the “put right”). The put right shall be
exercisable by written notice to the Committee during the first 60 days
after the Company Stock is distributed by the Plan, and, if not exercised
in that period, during the first 60 days in the following Plan Year after
the Committee has communicated to the Participant its determination as to
the Company Stock’s current fair market value. If the put right is exercised,
the Trustee may, if so directed by the Committee in its sole discretion,
assume the Employer’s rights and obligations with respect to purchasing
the Company Stock. However, the put right shall not apply to the extent
that the Company Stock, at the time the put right would otherwise be
exercisable, may be sold on an established market in accordance with
federal and state securities laws and regulations.
	 
	(c)	 	With respect to a put right, the Employer or the Trustee, as the case may
be, may elect to pay for the Company Stock in equal periodic installments,
not less frequently than annually, over a period not longer than five (5)
years from the 30th day after the put right is exercised pursuant to
paragraph (b) of this Section 7.05, with adequate security and interest at
a reasonable rate on the unpaid balance, all such terms to be set forth in
a promissory note delivered to the seller with normal terms as to
acceleration upon any uncured default.
	 
	(d)	 	Nothing contained in this Section 7.05 shall be deemed to obligate any
Employer to register any Company Stock under any federal or state
securities law or to create or maintain a public market to facilitate the
transfer or disposition of any Company Stock. The put right described in
this Section 7.05 may only be exercised by a person described in paragraph
(b) of this Section 7.05, and may not be transferred with any Company
Stock to any other person. As to all Company Stock purchased by the Plan
in exchange for any Acquisition Loan, the put right must be nonterminable.
The put right for Company Stock acquired through an Acquisition Loan
shall continue with respect to such Company Stock after the Acquisition
Loan is repaid or the Plan ceases to be an employee stock ownership plan.
Except as provided above, in accordance with the provisions of Sections
54.4975-7(b)(4) of the Treasury Regulations, no Company Stock acquired
with the proceeds of an Acquisition Loan may be subject to any put, call
or other option or buy-sell or similar arrangement while held by, and when
distributed from, the Plan, whether or not the Plan is then an employee
stock ownership plan.





Section 7.06 Restrictions on Disposition of Company Stock.




Except in the case of Company Stock which is traded on an established market, a
Participant who receives Company Stock pursuant to this Section 7, and any
person who has received Company Stock from the Plan or from such a Participant
by reason of the Participant’s death or incompetency, divorce or separation
from the Participant, or a rollover distribution described in
Section 402(c) of the Code, shall, prior to any sale or other transfer of the
Company Stock to any other person, first offer the Company Stock to the issuing
Employer and to the Plan at its current fair market value. This restriction
shall apply to any transfer, whether voluntary, involuntary, or by operation of
law, and whether for consideration or gratuitous. Either the Employer or the




23









 








Trustee may accept the offer within 14 days after it is delivered. Any Company
Stock distributed by the Plan shall bear a conspicuous legend describing the
right of first refusal under this Section 7.06, as applicable, as well as any
other restrictions upon the transfer of the Company Stock imposed by federal
and state securities laws and regulations.




Section 7.07 Direct Transfer of Eligible Plan Distributions.





	(a)	 	Notwithstanding any provision of the Plan to the contrary that would
otherwise limit a distributee’s election under this Section, a distributee
(as defined below) may elect to have any portion of an eligible rollover
distribution (as defined below) paid directly to an eligible retirement
plan (as defined below) specified by the distributee in a direct rollover
(as defined below). A “distributee” includes a Participant or former
Participant. In addition, the Participant’s or former Participant’s
surviving spouse and the Participant’s or former Participant’s spouse or
former spouse who is the alternate payee under a qualified domestic
relations order, as defined in Section 414(p) of the Code, are
distributees with regard to the interest of the spouse or former spouse.
For purposes of this Section 7.07 a “direct rollover” is a payment by the
Plan to the eligible retirement plan specified by the distributee.
	 
	(b)	 	To effect such a direct transfer, the distributee must notify the
Committee that a direct rollover is desired and provide to the Committee
sufficient information regarding the eligible retirement plan to which the
payment is to be made. Such notice shall be made in such form and at such
time as the Committee may prescribe. Upon receipt of such notice, the
Committee shall direct the Trustee to make a trustee-to-trustee transfer
of the eligible rollover distribution to the eligible retirement plan so
specified.
	 
	(c)	 	For purposes of this Section 7.07, an “eligible rollover distribution”
shall have the meaning set forth in Section 402(c)(4) of the Code and any
Treasury Regulations promulgated thereunder. To the extent such meaning
is not inconsistent with the above references, an eligible rollover
distribution shall mean any distribution of all or any portion of the
Participant’s Account, except that such term shall not include any
distribution which is one of a series of substantially equal periodic
payments (not less frequently than annually) made (i) for the life (or
life expectancy) of the Participant or the joint lives (or joint life
expectancies) of the Participant and a designated Beneficiary, or (ii) for
a period of ten years or more. Further, the term “eligible rollover
distribution” shall not include any distribution required to be made under
Section 401(a)(9) of the Code or, the portion of any distribution that is
not includible in gross income (determined without regard to the
exclusions for net unrealized appreciation with respect to Company Stock).
To the extent applicable under the Plan, “eligible rollover
distributions” shall also not include any hardship distribution described
in Section 401(k)(2)(B)(i)(IV) of the Code.
	 
	(d)	 	For purposes of this Section 7.07, an “eligible retirement plan” shall
have the meaning set forth in Section 402(c)(8) of the Code and any
Treasury Regulations promulgated thereunder. To the extent such meaning
is not consistent with the above references, an eligible retirement plan
shall mean: (i) an individual retirement account described in




24









 






	 	 	Section 408(a) of the Code, (ii) an individual retirement annuity described in
Section 408(b) of the Code, (iii) an annuity or annuity plan described in
Section 403(a) or Section 403(b) of the Code, (iv) a qualified trust
described in Section 401(a) of the Code, or (v) a governmental plan under
Section 457 of the Code that accepts the distributee’s eligible rollover
distribution. However, in the case of an eligible rollover distribution
to a surviving spouse, an eligible retirement plan means an individual
retirement account or individual retirement annuity.





SECTION 8

Voting of Company Stock and Tender Offers




Section 8.01 Voting of Company Stock.





	(a)	 	In General. The Trustee shall generally vote all shares of Company Stock
held in the Trust in accordance with the provisions of this Section 8.01.
	 
	(b)	 	Allocated Shares. Shares of Company Stock which have been allocated to
Participants’ Accounts shall be voted by the Trustee in accordance with
the Participants’ written instructions.
	 
	(c)	 	Uninstructed and Unallocated Shares. Shares of Company Stock which have
been allocated to Participants’ Accounts but for which no written
instructions have been received by the Trustee regarding voting shall be
voted by the Trustee in a manner calculated to most accurately reflect the
instructions the Trustee has received from Participants regarding voting
            shares of allocated Company Stock. Shares of unallocated Company Stock
shall also be voted by the Trustee in a manner calculated to most
accurately reflect the instructions the Trustee has received from
Participants regarding voting shares of allocated Company Stock.
Notwithstanding the preceding two sentences, all shares of Company Stock
which have been allocated to Participants’ Accounts and for which the
Trustee has not timely received written instructions regarding voting and
all unallocated shares of Company Stock must be voted by the Trustee in a
manner determined by the Trustee to be solely in the best interests of the
Participants and Beneficiaries.
	 
	(d)	 	Voting Prior to Allocation. In the event no shares of Company Stock have
been allocated to Participants’ Accounts at the time Company Stock is to
be voted, each Participant shall be deemed to have one share of Company
Stock allocated to his Accounts for the sole purpose of providing the
Trustee with voting instructions.
	 
	(e)	 	Procedure and Confidentiality. Whenever such voting rights are to be
exercised, the Employers, the Committee, and the Trustee shall see that
all Participants and Beneficiaries are provided with the same notices and
other materials as are provided to other holders of the Company Stock,
and are provided with adequate opportunity to deliver their instructions to
the Trustee regarding the voting of Company Stock allocated to their Accounts
or deemed allocated to their Accounts for purposes of voting. The




25









 






	 	 	instructions of the Participants with respect to the voting of shares of
Company Stock shall be confidential.





Section 8.02 Tender Offers.




In the event of a tender offer, Company Stock shall be tendered by the Trustee
in the same manner set forth in Section 8.01 of the Plan regarding the voting
of Company Stock.




SECTION 9

The Committee and Plan Administration




Section 9.01 Identity of the Committee.




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




Section 9.02 Authority of Committee.





	(a)	 	The Committee shall be the “plan administrator” within the meaning of
ERISA and shall have exclusive responsibility and authority to control and
manage the operation and administration of the Plan, including the
interpretation and application of its provisions, except to the extent
such responsibility and authority are otherwise specifically:






	(i)	 	allocated to the Bank, the Employers, or the Trustee under
the Plan and Trust Agreement;
	 
	(ii)	 	delegated in writing to other persons by the Bank, the
Employers, the Committee, or the Trustee; or
	 
	(iii)	 	allocated to other parties by operation of law.






	(b)	 	The Committee shall have exclusive responsibility regarding decisions
concerning the payment of benefits under the Plan.
	 
	(c)	 	The Committee shall have full investment responsibility with respect to
the Investment Fund except to the extent, if any, specifically provided
for in the Trust Agreement.
	 
	(d)	 	In the discharge of its duties, the Committee may employ accountants,
actuaries, legal counsel, and other agents (who also may be employed by an
Employer or the Trustee in the same or some other capacity) and may pay
such individuals reasonable compensation




26









 






	 	 	and expenses for their services rendered with respect to the operation
or administration of the Plan, to the extent such payments are not
otherwise prohibited by law.





Section 9.03 Duties of Committee.





	(a)	 	The Committee shall keep whatever records may be necessary in connection
with the maintenance of the Plan and shall furnish to the Employers
whatever reports may be required from time to time by the Employers. The
Committee shall furnish to the Trustee whatever information may be
necessary to properly administer the Trust. The Committee shall see to
the filing with the appropriate government agencies of all reports and
returns required with respect to the Plan under ERISA, the Code and other
applicable laws and regulations.
	 
	(b)	 	The Committee shall have exclusive responsibility and authority with
respect to the Plan’s holdings of Company Stock and shall direct the
Trustee in all respects regarding the purchase, retention, sale, exchange,
and pledge of Company Stock and the creation and satisfaction of any
Acquisition Loan to the extent such responsibilities are not set forth in
the Trust Agreement.
	 
	(c)	 	The Committee shall at all times act consistently with the Bank’s
long-term intention that the Plan, as an employee stock ownership plan, be
invested primarily in Company Stock. Subject to the direction of the
Committee with respect to any Acquisition Loan pursuant to the provisions
of Section 4.03 of the Plan, and subject to the provisions of Sections
7.05 and 11.04 of the Plan as to Participants’ rights under certain
circumstances to have their Accounts invested in Company Stock or in
assets other than Company Stock, the Committee shall determine, in its
sole discretion, the extent to which assets of the Trust shall be used to
repay any Acquisition Loan, to purchase Company Stock, or to invest in
other assets selected by the Committee or an investment manager. No
provision of the Plan relating to the allocation or vesting of any
interests in Company Stock or investments other than Company Stock shall
restrict the Committee from changing any holdings of the Trust Fund,
whether the changes involve an increase or a decrease in the Company Stock
or other assets credited to Participants’ Accounts. In determining the
proper extent of the Trust Fund’s investment in Company Stock, the
Committee shall be authorized to employ investment counsel, legal counsel,
appraisers, and other agents and to pay their reasonable compensation and
expenses to the extent such payments are not prohibited by law.
	 
	(d)	 	If the valuation of any Company Stock is not established by reported
trading on a generally recognized public market, then the Committee shall
have the exclusive authority and responsibility to determine the value of
the Company Stock for all purposes under the Plan. Such value shall be
determined as of each Valuation Date and on any other date as of which the
Trustee purchases or sells Company Stock in a manner consistent with
Section 4975 of the Code and the Treasury Regulations issued thereunder.
The Committee shall use generally accepted methods of valuing stock of
similar corporations for purposes of arm’s length business and investment
transactions, and in this connection the Committee shall obtain, and shall
be protected in relying upon, the




27









 






	 	 	valuation of Company Stock as determined by an independent appraiser
(as defined in Section 401(a)(28)(c) of the Code).





Section 9.04 Compliance with ERISA and the Code.




The Committee shall perform all acts necessary to ensure the Plan’s compliance
with ERISA and the Code. Each individual member of the Committee shall
discharge his duties in good faith and in accordance with the applicable
requirements of ERISA and the Code.




Section 9.05 Action by Committee.




All actions of the Committee shall be governed by the affirmative vote of a
majority of the total number of Committee members. The members of the
Committee may meet informally and may take any action without meeting as a
group.




Section 9.06 Execution of Documents.




Any instrument to be executed by the Committee may be signed by any member of
the Committee.




Section 9.07 Adoption of Rules.




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




Section 9.08 Responsibilities to Participants.




The Committee shall determine which Employees qualify to participate in the
Plan. The Committee shall furnish to each Eligible Employee whatever summary
plan descriptions, summary annual reports, and other notices and information
that may be required under ERISA.
The Committee also shall determine when a Participant or his Beneficiary
qualifies for the payment of benefits under the Plan. The Committee shall
furnish to each such Participant or Beneficiary whatever information is
required under ERISA or the Code (or is otherwise appropriate) to enable the
Participant or Beneficiary to make whatever elections may be available pursuant
to Section 7, and the Committee shall provide for the payment of benefits in
the proper form and amount from the Trust. The Committee may decide in its
sole discretion to permit modifications of elections and to defer or accelerate
benefits to the extent consistent with the terms of the Plan, applicable law,
and the best interests of the individuals concerned.




Section 9.09 Alternative Payees in Event of Incapacity.




If the Committee finds at any time that an individual qualifying for benefits
under this Plan is a minor or is incompetent, the Committee may direct the
benefits to be paid, in the case of a minor, to his parents, his legal
guardian, a custodian for him under the Uniform Transfers to Minors Act, or the
person having actual custody of him, or, in the case of an incompetent, to his
spouse, his legal guardian, or the person having actual custody of him. The
Committee and the Trustee




28









 








shall not be obligated to inquire as to the actual
use of the funds by the person receiving them under this Section 9.09, and any
such payment shall completely discharge the obligations of the Plan, the
Trustee, the Committee, and the Employers to the extent of the payment.




Section 9.10 Indemnification by Employers.




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




Section 9.11 Abstention by Interested Member.




Any member of the Committee who is also a Participant in the Plan shall take no
part in any determination specifically relating to his own participation or
benefits under the Plan, unless an abstention would render the Committee
incapable of acting on the matter.




SECTION 10

Rules Governing Benefit Claims




Section 10.01 Claim for Benefits.




Any Participant or Beneficiary who qualifies for the payment of benefits shall
file a claim for benefits with the Committee on a form provided by the
Committee. The claim, including any election of an alternative benefit form,
shall be filed at least 30 days before the date on which the benefits are to
begin. If a Participant or Beneficiary fails to file a claim by the 30th day
before the date on which benefits become payable, he shall be presumed to have
filed a claim for payment for the Participant’s benefits in the standard form
prescribed by Section 7 of the Plan.




Section 10.02 Notification by Committee.




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





	(a)	 	each specific reason for the denial;
	 
	(b)	 	specific references to the pertinent Plan provisions on which the denial
is based;




29









 






	(c)	 	a description of any additional material or information which could be
submitted by the Participant or Beneficiary to support his claim, with an
explanation of the relevance of such information; and
	 
	(d)	 	an explanation of the claims review procedures set forth in Section 10.03
of the Plan.





Section 10.03 Claims Review Procedure.




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




SECTION 11

The Trust




Section 11.01 Creation of Trust Fund.




All amounts received under the Plan from an Employer and investments shall be
held in a Trust Fund pursuant to the terms of this Plan and the Trust
Agreement. The benefits described in this Plan shall be payable only from the
assets of the Trust Fund. Neither the Bank, any other Employer, its board of
directors or trustees, its stockholders, its officers, its employees, the
Committee, nor the Trustee shall be liable for payment of any benefit under
this Plan except from the Trust Fund.




Section 11.02 Company Stock and Other Investments.




The Trust Fund held by the Trustee shall be divided into Company Stock and
investments other than Company Stock. The Trustee shall have no investment
responsibility for the portion of the Trust Fund consisting of Company Stock,
but shall accept any Employer contributions made in the form of Company Stock,
and shall acquire, sell, exchange, distribute, and otherwise deal with and
dispose of Company Stock in accordance with the instructions of the Committee.




Section 11.03 Acquisition of Company Stock.




From time to time the Committee may, in its sole discretion, direct the Trustee
to acquire Company Stock from the issuing Employer or from shareholders,
including shareholders who are or have been Employees, Participants, or
fiduciaries with respect to the Plan. The Trustee shall




30









 








pay for such Company Stock no more than its fair market value, which shall be
determined conclusively by the Committee pursuant to Section 9.03(d) of the Plan.
The Committee may direct the Trustee to finance the acquisition of Company Stock
through an Acquisition Loan subject to the provisions of Section 4.03 of the
Plan.




Section 11.04 Participants’ Option to Diversify.




The Committee shall establish a procedure under which each Participant may,
during the first five years of a certain six-year period, elect to have up to
25 percent of the value of his Accounts committed to alternative investment
options within an “Investment Fund.” For the sixth year in this period, the
Participant may elect to have up to 50 percent of the value of his Accounts
committed to other investments. The six-year period shall begin with the Plan
Year following the first Plan Year in which the Participant has both reached
age 55 and completed 10 years of participation in the Plan; a Participant’s
election to diversify his Accounts must be made within the 90-day period
immediately following the last day of each of the six Plan Years. The
Committee shall see that the Investment Fund includes a sufficient number of
investment options to comply with Section 401(a)(28)(B) of the Code. The
Committee may, in its discretion, permit a transfer of a portion of the
Participant’s Accounts to the First Federal Savings Bank 401(k) Plan in order
to satisfy this Section 11.04, provided such investments comply with Section
401(a)(28)(B) of the Code and such transfer is not otherwise prohibited under
the Code or ERISA. The Trustee shall comply with any investment directions received from
Participants in accordance with the procedures adopted from time to time by the
Committee under this Section 11.04.




SECTION 12

Adoption, Amendment and Termination




Section 12.01 Adoption of Plan by Other Employers.




With the consent of the Bank, any entity may become a participating Employer
under the Plan by:





	(a)	 	taking such action as shall be necessary to adopt the Plan;
	 
	(b)	 	becoming a party to the Trust Agreement establishing the Trust Fund; and
	 
	(c)	 	executing and delivering such instruments and taking such other action as
may be necessary or desirable to put the Plan into effect with respect to
the entity’s Employees.





Section 12.02 Adoption of Plan by Successor.




In the event that any Employer shall be reorganized by way of merger,
consolidation, transfer of assets or otherwise, so that an entity other than an
Employer shall succeed to all or substantially all of the Employer’s business,
the successor entity may be substituted for the Employer under the Plan by
adopting the Plan and becoming a party to the Trust Agreement. Contributions
by the Employer shall be automatically suspended from the effective date of any
such




31









 








reorganization until the date upon which the substitution of the successor
entity for the Employer under the Plan becomes effective. If, within 90 days
following the effective date of any such reorganization, the successor entity
shall not have elected to become a party to the Plan, or if the Employer shall
adopt a plan of complete liquidation other than in connection with a
reorganization, the Plan shall be automatically terminated with respect to
Employees of the Employer as of the close of business on the 90th day following
the effective date of the reorganization, or as of the close of business on the
date of adoption of a plan of complete liquidation, as the case may be.




Section 12.03 Plan Adoption Subject to Qualification.




Notwithstanding any other provision of the Plan, the adoption of the Plan and
the execution of the Trust Agreement are conditioned upon their being
determined initially by the Internal Revenue Service to meet the qualification
requirements of Section 401(a) of the Code, so that the
Employers may deduct currently for federal income tax purposes their
contributions to the Trust and so that the Participants may exclude the
contributions from their gross income and recognize income only when they
receive benefits. In the event that this Plan is held by the Internal Revenue
Service not to qualify initially under Section 401(a) of the Code, the Plan may
be amended retroactively to the earliest date permitted by the Code and the
applicable Treasury Regulations in order to secure qualification under Section
401(a) of the Code. If this Plan is held by the Internal Revenue Service not
to qualify initially under Section 401(a) of the Code either as originally
adopted or as amended, each Employer’s contributions to the Trust under this
Plan (including any earnings thereon) shall be returned to it and this Plan
shall be terminated. In the event that this Plan is amended after its initial
qualification, and the Plan, as amended, is held by the Internal Revenue
Service not to qualify under Section 401(a) of the Code, the amendment may be
modified retroactively to the earliest date permitted by the Code and the
applicable Treasury Regulations in order to secure approval of the amendment
under Section 401(a) of the Code.




Section 12.04 Right to Amend or Terminate.





	(a)	 	The Bank intends to continue this Plan as a permanent program.
However, each participating Employer separately reserves the right to
suspend, supersede, or terminate the Plan at any time and for any reason,
as it applies to that Employer’s Employees, and the Bank reserves the
right to amend, suspend, supersede, merge, consolidate, or terminate the
Plan at any time and for any reason, as it applies to the Employees of
all Employers.
	 
	(b)	 	No amendment, suspension, supersession, merger, consolidation, or
termination of the Plan shall reduce any Participant’s or Beneficiary’s
proportionate interest in the Trust Fund, or shall divert any portion of
the Trust Fund to purposes other than the exclusive benefit of the
Participants and their Beneficiaries prior to the satisfaction of all
liabilities under the Plan. Except as is required for purposes of
compliance with the Code or ERISA, neither the provisions of Section 5.04
relating to the crediting of contributions, forfeitures and shares of
Company Stock released from the Loan Suspense Account, nor any other
provision of the Plan relating to the allocation of benefits to
Participants, may




32









 






	 	 	be amended more frequently than once every six months.
Moreover, there shall not be any transfer of assets to a successor plan or
merger or consolidation with another plan unless, in the event of the
termination of the successor plan or the surviving plan immediately
following such transfer, merger, or consolidation, each participant or
beneficiary would be entitled to a benefit equal to or greater than the
benefit he would have been entitled to if the plan in which he was
previously a participant or beneficiary had terminated immediately prior
to such transfer, merger, or consolidation. Following a termination of
this Plan by the Bank, the Trustee shall continue to administer the Trust
and pay benefits in accordance with the Plan and the Committee’s
instructions.
	 
	(c)	 	In the event of a Change in Control, the Plan shall be terminated and
allocations made to Participants in accordance with the provisions of
Section 5.08 of the Plan.





SECTION 13

General Provisions




Section 13.01 Nonassignability of Benefits.




The interests of Participants and other persons entitled to benefits under the
Plan shall not be subject to the claims of their creditors and may not be
voluntarily or involuntarily assigned, alienated, pledged, encumbered, sold, or
transferred. The prohibitions set forth in this Section 13.01 shall also apply
to any judgment, decree, or order (including approval of a property or
settlement agreement) which relates to the provision of child support, alimony,
or property rights to a present or former spouse, child, or other dependent of
a Participant pursuant to a domestic relations order, unless such judgment,
decree or order is determined to be a “qualified domestic relations order” as
defined in Section 414(p) of the Code.




Section 13.02 Limit of Employer Liability.




The liability of the Employers with respect to Participants and other persons
entitled to benefits under the Plan shall be limited to making contributions to
the Trust from time to time, in accordance with Section 4 of the Plan.




Section 13.03 Plan Expenses.




All expenses incurred by the Committee or the Trustee in connection with
administering the Plan and Trust shall be paid by the Trustee from the Trust
Fund to the extent the expenses have not been paid or assumed by the Employer.




Section 13.04 Nondiversion of Assets.




Except as provided in Sections 5.05 and 12.03 of the Plan, under no
circumstances shall any portion of the Trust Fund be diverted to or used for
any purpose other than the exclusive benefit of Participants and their
Beneficiaries prior to the satisfaction of all liabilities under the Plan.




33









 








Section 13.05 Separability of Provisions.




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




Section 13.06 Service of Process.




The agent for the service of process upon the Plan shall be the Chairman of the
Board of the Bank and the Trustee, or such other person as may be designated
from time to time by the Bank.




Section 13.07 Governing Law.




The Plan is established under, and its validity, construction and effect shall
be governed by the laws of the State of Pennsylvania to the extent those laws
are not preempted by federal law, including the provisions of ERISA.




Section 13.08 
Special Rules for Persons Subject to Section 16(b) Requirements.




Notwithstanding anything herein to the contrary, any former Participant who is
subject to the provisions of Section 16(b) of the Securities Exchange Act of
1934, who becomes eligible to again participate in the Plan, may not become a
Participant prior to the date that is six months from the date such former
Participant terminated participation in the Plan. In addition, any person
subject to the provisions of Section 16(b) of the Securities Exchange Act of
1934 Act receiving a distribution of Company Stock from the Plan must hold such
Company Stock for a period of six months, commencing with the date of
distribution. However, this restriction will not apply to Company Stock
distributions made in connection with death, retirement, Disability or
termination of employment, or made pursuant to the terms of a qualified
domestic relations order.




Section 13.09 Military Service.




Notwithstanding any other provision of this Plan to the contrary,
contributions, benefits and Service credit with respect to qualified military
service will be provided in accordance with Section 414(u) of the Code.




SECTION 14

Top-Heavy Provisions




Section 14.01 Top-Heavy Provisions.




If, as of the last day of the first Plan Year, or thereafter, if as of the day
next preceding the beginning of any Plan Year (the “Determination Date”), the
Plan is a “top-heavy plan” (determined in accordance with the provisions of
Section 416(g) of the Code), that is, the aggregate present value of the
accrued benefits and account balances of all “Key Employees” (within the
meaning of Section 416(i) of the Code, and for this purpose using the
definition of




34









 








Compensation, as modified under Section 5.05(b) of the Plan) and
their Beneficiaries, exceeds sixty percent (60%) of the aggregate present value
of the accrued benefits and account balances of all employees and their
beneficiaries, the provision specified in this Section 14 will automatically
become effective as of the first day of the Plan Year. This calculation shall
be made in accordance with Section 416(g) of the Code, taking into
consideration plans which are considered part of the Aggregation Group. The
term “Aggregation Group” shall include each plan of the Bank or any of its
Affiliates that includes a Key Employee and each plan of the Bank
or any of its Affiliates that allows the Plan to meet the requirements of
Section 401(a)(4) of the Code or Section 410 of the Code and may include any
other plan of the Bank or any of its Affiliates, if the Aggregation Group would
continue to meet the requirements of Sections 401(a)(4) and 410 of the Code.




Section 14.02 Plan Modifications Upon Becoming Top-Heavy.





	(a)	 	Minimum Accruals. Section 5.04 of the Plan will be modified to provide
that the aggregate amount of Employer contributions allocated in each Plan
Year to the Accounts of each Participant who is a non-Key Employee (as
defined under Section 416(i)(1) of the Code), and who is employed by an
Employer as of the last day of the Plan Year, may not be less than the
lesser of:






	(i)	 	three percent of his Compensation for the Plan Year; and
	 
	(ii)	 	a percentage of his Compensation equal to the largest
percentage obtained by dividing the sum of the amount credited to
the Accounts of any Key Employee by that Key Employee’s
Compensation.






	(b)	 	The preceding provision will remain in effect for the period in which the
Plan is top-heavy. If, for any particular year thereafter, the Plan is no
longer top-heavy, the provisions contained in this Section 14.02 shall
cease to apply, except that any previously vested portion of any Account
balance shall remain nonforfeitable.






35










 







ESOP TRUST AGREEMENT




BETWEEN




____________________________




AND




FIRST FEDERAL SAVINGS BANK




     THIS
AGREEMENT OF TRUST (the “Agreement”) effective as of
____,
2005 by and between FIRST FEDERAL SAVINGS BANK, a federal savings association
(the “Company”) and ____, a trust company incorporated
under the laws of the State of ____ (the “Trustee”),



WITNESSETH




     WHEREAS, the Company has adopted the First Federal Savings Bank Employee
Stock Ownership Plan (the “Plan”), effective as of January 1, 2005 for the
exclusive purpose of providing benefits to participants and their beneficiaries
under the Plan;



     WHEREAS, the Company desires to establish a trust (the “Trust”) for the
Plan and to appoint the Trustee to serve as trustee for the Trust, effective as
of ____, 2005;



     WHEREAS, the Trustee wishes to accept its appointment as trustee for the
Plan;



     NOW, THEREFORE, in consideration of the mutual covenants contained herein,
the parties hereto, intending to be legally bound, hereby agree and declare as
follows:



ARTICLE I

ESTABLISHMENT OF TRUST




     Section 1.1. The Company and the Trustee hereby agree to the establishment
of a trust consisting of such sums as shall from time to time be paid to the
Trustee under the Plan and such earnings, income and appreciation as may accrue
thereon which, less payments made by the Trustee to carry out the purposes of
the Plan, are referred to herein as the “Fund”. The Trustee shall carry out
the duties and responsibilities herein specified, but shall be under no duty to
determine whether the amount of any contribution by the Company or any
affiliated entity or by any participant under the Plan is in accordance
with the terms of the Plan, nor shall the Trustee be responsible for the
collection of any contributions required under the Plan.



     Section 1.2. The Fund shall be held, invested, reinvested and administered
by the Trustee in accordance with the terms of the Plan and this Agreement
solely in the interest of participants and their beneficiaries under the Plan
and for the exclusive purpose of providing



 









 





benefits to participants and their
beneficiaries and defraying the reasonable expenses of administering the Plan.
Except as provided in Section 4.2, no assets of the Plan shall inure to the
benefit of the Company or any affiliated entity.



     Section 1.3. The Trustee shall pay benefits and expenses from the Fund
only upon the written direction of the Plan Administrator, the individual
specified in the Plan as the fiduciary responsible for the day-to-day operation
and administration of the Plan. The Trustee shall be fully entitled to rely on
such directions furnished by the Plan Administrator and shall be under no duty
to ascertain whether the directions are in accordance with the provisions of
the Plan.



ARTICLE II

INVESTMENT OF THE FUND




     Section 2.1. In accordance with the provisions of the Plan, the Trustee
shall invest and reinvest the Fund without distinction between principal and
income in Company Stock in accordance with the terms of the Plan and this
Agreement as directed by the Company. To the extent that contributions are
made in Company Stock, the Trustee will be expected to retain such Company
Stock. To the extent contributions are made in cash or other amounts are
received in cash and are not needed to pay principal or interest on an ESOP
loan, to pay distributions to participants and their beneficiaries or to pay
expenses of the Trust, the Trustee will either distribute such amounts as a
cash dividend in accordance with Section 7.2 of the Plan or credit such amounts
to Plan accounts in accordance with Section 7.2 of the Plan. If at the time
Company Stock is to be purchased, the Company has outstanding more than one
class of Company Stock, the Company shall direct the Trustee as to which class
of Company Stock shall be purchased.



     Section 2.2. In accordance with the provisions of the Plan and except as
provided in Section 2.1, all assets of the Fund shall be invested by the
Trustee solely in Company Stock, with the exception that if the Trustee is
notified by the Company that a participant is eligible to make a
diversification election, if provided for under the Plan, whereby the
participant may transfer a specified portion of the participant’s account to
other investment options available under the Plan, the Trustee shall invest
such specified portion of the participant’s account in accordance with the
participant’s investment directions as provided for in the Plan and Section 2.3
hereof. The Company shall notify the Trustee of any such investment options
currently available under the Plan and any other plan sponsored by the Company
which accepts such amounts and of any changes thereto, which changes shall be
effective no earlier than 60 days after delivery of written notice to the
Trustee (unless otherwise agreed to by the Trustee).



     In accordance with the provisions of the Plan, the Named Fiduciary of the
Plan is authorized to appoint an “investment manager” as defined in Section
3(38) of the Employee Retirement Income Security Act of 1974, as amended
(“ERISA”), to be responsible for managing one or more of the designated
investment options available under the Plan and selecting the specific
investments that comprise any such investment option. In such case, the Named
Fiduciary shall establish the investment policies and guidelines that the
investment manager shall follow when managing the investment option for the
Plan, but the Named Fiduciary shall not be responsible for the selection of the
specific investments that comprise any such investment option. The Trustee
shall follow the directions of the investment manager



2









 





regarding the designated
investment option(s) for which the investment manager is assigned
responsibility.



     Section 2.3. In accordance with the provisions of the Plan, each
participant who is eligible to make the diversification election described in
Section 2.2 shall direct the Trustee as to the investment of that portion of
his or her account subject to such election. All investment directions by
participants shall be timely furnished to the Trustee by the Plan
Administrator, except to the extent such directions are transmitted
telephonically or otherwise by participants and beneficiaries directly to the
Trustee in accordance with rules and procedures established and approved by the
Plan Administrator and the Trustee. In making any such investment of the
assets of the Fund, the Trustee shall be fully entitled to rely on the
directions from participants that are properly furnished to the Trustee, and
the Trustee shall be under no duty to make any inquiry or investigation with
respect thereto.



     Section 2.4. Subject to the provisions of Section 2.1, 2.2, and 2.3, the
Trustee shall have the authority, in addition to any authority given by law, to
exercise the following powers in the administration of the Fund:




     (a) with respect to the diversification election described in
Section 2.2 above, to invest and reinvest all or a part of the assets of
the Fund in the available investment options under the Plan without
restriction to investments authorized for fiduciaries, including, without
limitation on the amount that may be invested therein, any common,
collective or commingled trust fund maintained by the Trustee, investment
company, mutual fund, or other security or investment option offered by
the Trustee. Any investment in, and any terms and conditions of, any
common, collective or commingled trust fund available only to employee
trusts which meet the requirements of the Code or corresponding
provisions of subsequent income tax laws of the United States, shall
constitute an integral part of this Agreement and the Plan;




     (b) to dispose of all or any part of the investments, securities, or
other property which may from time to time or at any time constitute the
Fund and to make, execute and deliver to the purchasers thereof good and
sufficient deeds of conveyance thereof, and all assignments, transfers
and other legal instruments, either necessary or convenient for passing
the title and ownership thereto, free and
discharged of all trusts and without liability on the part of such
purchasers to see to the application of the purchase money;




     (c) to cause any investment of the Fund to be registered in the name
of the Trustee or the name of its nominee or nominees or to retain such
investment unregistered or in a form permitting transfer by delivery;
provided that the books and records of the Trustee shall at all times
show that all such investments are part of the Fund;




     (d) to consult and employ any suitable agent to act on behalf of the
Trustee and to contract for legal, accounting, clerical and other
services deemed necessary by the Trustee to manage and administer the
Fund according to the terms of the Plan and this Agreement;



3









 






     (e) to pay from the Fund all taxes imposed or levied with respect to
the Fund or any part thereof under existing or future laws, and to
contest the validity or amount of any tax, assessment, claim or demand
respecting the Fund or any part thereof; and




     (f) generally to exercise any of the powers of an owner with respect
to all or any part of the Fund.



     Section 2.5. Each participant or beneficiary to whose account shares of
Company stock have been allocated shall, as a named fiduciary within the
meaning of Section 403(a)(1) of ERISA, direct the Trustee with respect to the
voting and, if applicable, tendering of shares of Company stock allocated to
his or her account, and the Trustee shall follow the directions of those
participants and beneficiaries who provide timely instructions to the Trustee.
The Trustee shall vote the shares of Company stock allocated to the accounts of
participants for whom no timely instructions have been received in the same
proportion as those shares of Company stock for which instructions were timely
received, provided that the Plan requires that participants and beneficiaries
be given advance notice as to the consequences of any failure to instruct the
Trustee as to the voting of allocated shares of Company stock. Allocated
shares of Company stock will not be tendered, unless directed by a participant
or beneficiary to whose account shares of Company stock have been allocated.
The Trustee or an independent fiduciary (engaged by the Trustee) shall direct
the voting and, if applicable, tendering of shares of Company stock which have
not been allocated to the accounts of participants or beneficiaries; provided,
however, that the Trustee may require, in its sole discretion, that an
independent fiduciary (engaged by the Company and approved of by the Trustee)
shall direct the Trustee with respect to the voting, and, if applicable,
tendering of shares of Company stock which have not been allocated with respect
to any corporate matter which involves the voting of Company stock with respect
to the approval or disapproval of any corporate merger or consolidation,
recapitalization, reclassification, liquidation, dissolution, a sale of
substantially all assets of the business, or any similar transaction.



     Section 2.6. Except as may be authorized by regulations promulgated by the
Secretary of Labor, the Trustee shall not maintain the indicia of ownership in
any assets of the Fund outside of the jurisdiction of the district courts of
the United States.



ARTICLE III

DUTIES AND RESPONSIBILITIES





     Section 3.1. The Trustee, Company, Named Fiduciary and Plan Administrator
shall each discharge their assigned fiduciary duties and responsibilities under
this Agreement and the Plan solely in the interest of participants and their
beneficiaries in the following manner:




     (a) for the exclusive purpose of providing benefits to participants
and their beneficiaries and defraying reasonable expenses of
administering the Plan;




     (b) with the care, skill, prudence, and diligence under the
circumstances then prevailing that a prudent person acting in a like
capacity and familiar with such matters would use in the conduct of an
enterprise of a like character and with like aims;



4









 






     (c) by selecting a range of available investment options under the
Plan referenced in Section 2.2 so as to permit participants and
beneficiaries to diversify their investments pursuant to Section 2.3; and




     (d) in accordance with the provisions of the Plan and this Trust
Agreement insofar as they are consistent with the provisions of ERISA.



     Section 3.2. The Trustee shall keep full and accurate accounts of all
receipts, investments, disbursements and other transactions hereunder,
including such specific records as may be agreed upon in writing between the
Company and Trustee. All such accounts, books and records shall be open to
inspection and audit at all reasonable times by any authorized representative
of the Company, the Named Fiduciary or the Plan Administrator. Any participant
or beneficiary under the Plan may examine only those individual account records
pertaining directly to that participant or beneficiary.



     Section 3.3. The Trustee shall determine the value of the Fund at such
times as are mutually agreed upon by the Trustee and the Company but in no case
less frequently than annually. The value of shares of Company Stock held in
the Fund shall be determined at their fair market value defined as their
closing market price on the relevant valuation date; provided, however, that in
the event such shares of Company Stock have no readily-ascertainable fair
market value because they are thinly-traded, at their fair value as determined
in good faith and pursuant to written procedures recommended by the Company and
approved by the Trustee as of such times as the Trustee determines to be
appropriate, and from such financial publications, pricing services, or other
services or sources as the Trustee reasonably believes appropriate. All other
securities and the value of other assets held in the Fund shall be valued by
the Trustee at their market values on the relevant valuation date under
procedures established by the Trustee. For purposes of this Section, Company
Stock shall be considered “thinly traded” if it is publicly traded on a
national exchange or other generally recognized market, but not in sufficient
volume
and/or with sufficient frequency to assure prompt execution of buy and sell
orders. The Trustee may seek an opinion from an independent investment advisor
or legal counsel as to whether a given stock is “thinly traded.”



     Section 3.4. Within 120 days after the end of each plan year for the Plan
or within 120 days after its removal or resignation, the Trustee shall file
with the Named Fiduciary a written account of the administration of the Fund
showing all transactions effected by the Trustee with respect to the assets of
the Plan subsequent to the period covered by the last preceding account to the
end of such plan year or date of removal or resignation and all property held
at its fair market value at the end of the accounting period. Such accounting
shall show the net value of the Plan’s interest in each investment option
maintained by the Trustee for the Fund and shall include financial information
necessary for the completion of the annual reports required for the Plan under
ERISA. The Named Fiduciary may approve such accounting by written notice of
approval delivered to the Trustee or by failure to express objection to such
accounting in writing delivered to the Trustee within 120 days from the date on
which the accounting is delivered to the Named Fiduciary.



     Section 3.5. In accordance with the terms of the Plan, the Trustee shall
establish and maintain separate accounts in the name of each participant in
order to record all contributions by or on behalf of the participant to the
Plan and any earnings, losses and expenses attributable



5









 





thereto. The Plan
Administrator shall furnish the Trustee with participant enrollment data in a
format acceptable to the Trustee identifying the name, address, social security
number, and current investment directions of each participant for whom one or
more separate accounts are to be established by the Trustee under this
Agreement. With respect to all contributions to the Plan and other amounts
that are transmitted to the Trustee, the Plan Administrator shall furnish the
Trustee with participant allocation data in a format acceptable to the Trustee
identifying each participant on whose behalf an amount is being transmitted to
the Trustee and the dollar amount to be allocated to each of the participant’s
separate account under the Plan. In allocating amounts to participants’
separate accounts under the Plan, the Trustee shall be fully entitled to rely
on the participant enrollment and allocation data furnished to it by the Plan
Administrator and shall be under no duty to make any inquiry or investigation
with respect thereto.



     Section 3.6. The Trustee shall, at least annually, furnish each
participant in the Plan with statements reflecting the current fair market
value of the participant’s separate accounts under the Plan and all activities
occurring within such accounts during the most recent reporting period,
including Plan contributions, earnings, investment exchanges, distributions,
and withdrawals.



     Section 3.7. The Trustee shall not be required to determine the facts
concerning the eligibility of any participant to participate in the Plan, the
amount of benefits payable to any participant or beneficiary under the Plan, or
the date or method of payment or disbursement. The Trustee shall be fully
entitled to rely solely upon the written advice and directions of the Plan
Administrator as to any such question of fact.



     Section 3.8. Unless resulting from the Trustee’s gross negligence, willful
misconduct, lack of good faith, or breach of its fiduciary duties under this
Agreement or ERISA, the Company shall indemnify and save harmless the Trustee
from, against, for and in respect of any and all damages, losses, obligations,
liabilities, liens, deficiencies, costs and expenses, including without
limitation, reasonable attorney’s fees incident to any suit, action,
investigation, claim or proceedings suffered, sustained, incurred or required
to be paid by the Trustee in connection with the Plan or this Agreement.



ARTICLE IV

PROHIBITION OF DIVERSION




     Section 4.1. Except as provided in Section 4.2, at no time prior to the
satisfaction of all liabilities with respect to participants and their
beneficiaries under the Plan shall any part of the corpus or income of the Fund
be used for, or diverted to, purposes other than for the exclusive benefit of
participants or their beneficiaries, or for defraying reasonable expenses of
administering the Plan.



     Section 4.2. The provisions of Section 4.1 notwithstanding, contributions
made by the Company or any affiliated entity under the Plan will be returned to
the Company or affiliated entity under the following conditions:




     (a) If a contribution is made by mistake of fact, such contributions
may be returned within one year of the payment of such contribution upon
demand of the Company or affiliated entity; and



6









 






     (b) Contributions to the Plan are specifically conditioned upon
their deductibility under the Code. To the extent a deduction is
disallowed for any such contribution, it will be returned within one year
after the disallowance of the deduction upon demand of the Company or
affiliated entity. Contributions which are not deductible in the taxable
year in which made but are deductible in subsequent taxable years shall
not be considered to be disallowed for purposes of this subsection; and




     (c) Contributions to the Plan are specifically conditioned on
initial qualification of the Plan under the Code. If a Plan is
determined by the Internal Revenue Service to not be initially qualified,
upon demand of the Company or affiliated entity any employer
contributions made incident to that initial qualification will be
returned within one year after the date the initial qualification is
denied, provided that the determination of the Internal Revenue Service
is made pursuant to an application for determination made by the time
prescribed by law for filing the return of the Company or affiliated
entity for the taxable year in which the Plan is adopted or such later
date as is prescribed by the Secretary of the Treasury.



ARTICLE V

COMMUNICATION WITH FIDUCIARIES




     Section 5.1. Whenever the Trustee is permitted or required to act upon the
directions or instructions of the Company, any named fiduciary, any investment
manager or the Plan Administrator, the Trustee shall be entitled to rely upon
any written communication signed by any person or agent designated to act as or
on behalf of any such fiduciary. Such person or agent shall be so designated
either under the provisions of the Plan or in writing by the Company and such
authority shall continue until revoked in writing. The Trustee shall incur no
liability for failure to act on such person’s or agent’s instructions or orders
without written communication, and the Trustee shall be fully protected in all
actions taken in good faith in reliance upon any instructions, directions,
certifications and communications believed to be genuine and to have been
signed or communicated by the proper person.



     Section 5.2. The Company shall notify the Trustee in writing of the
appointment, removal or resignation of any person designated to act as or on
behalf of the Company, the Named Fiduciary, any investment manager, or the Plan
Administrator. After such notification, the Trustee shall be fully protected
in acting upon the directions of any person designated to act as or on behalf
of any such fiduciary until the Trustee receives notice from the Company to the
contrary. The Trustee shall have no duty to inquire into the qualifications of
any person designated to act as or on behalf of the Company, the Named
Fiduciary, any investment manager or the Plan Administrator.



ARTICLE VI

TRUSTEE’S COMPENSATION




     Section 6.1. The Trustee shall be entitled to reasonable compensation for
its services as is agreed upon with the Company. The Trustee shall also be
entitled to reimbursement for all direct expenses properly and actually
incurred on behalf of the Plan. Such compensation or reimbursement shall be
paid to the Trustee out of the Fund unless paid directly by the Company.



7









 





ARTICLE VII

RESIGNATION AND REMOVAL OF TRUSTEE




     Section 7.1. The Trustee may resign at any time by written notice to the
Company which shall be effective 60 days after delivery unless prior thereto a
successor trustee shall have been appointed.



     Section 7.2. The Trustee may be removed by the Company at any time upon 60
days written notice to the Trustee; such notice, however, may be waived by the
Trustee.



     Section 7.3. The appointment of a successor trustee hereunder shall be
accomplished by and take effect upon the delivery to the Trustee of written
notice of the Company appointing such successor trustee, and an acceptance in
writing of the successor trustee hereunder executed by the successor so
appointed. A successor trustee may be either a corporation authorized and
empowered to exercise trust powers or one or more individuals. All of the
provisions set forth herein with respect to the Trustee shall relate to each
successor trustee so appointed with the same force and effect as if such
successor trustee had been originally named herein as the trustee hereunder.
If within 60 days after notice of resignation or removal shall have been given
under the provisions of this Article VII a successor trustee shall not have
been appointed, the Trustee or Company may apply to any court of competent
jurisdiction for the appointment of a successor trustee.



     Section 7.4. Upon the appointment of a successor trustee, the Trustee
shall transfer and deliver the Fund to such successor trustee, after reserving
such reasonable amount as it shall deem necessary to provide for its expenses
in the settlement of its account, the amount of any compensation due to it and
any sums chargeable against the Fund for which it may be liable. If the sums
so reserved are not sufficient for such purposes, the resigning or removed
Trustee shall be entitled to reimbursement for any deficiency from the
successor trustee and the Company who shall be jointly and severally liable
therefor.



ARTICLE VIII

AMENDMENT AND TERMINATION OF THE TRUST AND PLAN




     Section 8.1. The Company may, by delivery to the Trustee of an instrument
in writing, terminate this Agreement at any time.



     Section 8.2. The Company may partially terminate this Agreement at any
time by delivering to the Trustee a written direction to transfer such part of
the Fund as may be specified in such direction to any other trust established
for the purpose of funding benefits under the Plan or under any other plan
qualifying under Section 401 of the Code, established for the benefit of
participants in the Plan or their beneficiaries by the Company or any
affiliated entity or any successor transferee of the Company or any
affiliated entity; provided such transfer shall be in conformity with the
requirements of Federal law.



     Section 8.3. This Agreement may be amended from time to time by the
Company; provided, however, that no amendment shall increase the duties or
liabilities of the Trustee without the Trustee’s consent; and, provided
further, that no amendment shall divert any part of



8









 





the Fund to any purpose
other than providing benefits to participants and their beneficiaries under the
Plan or defraying the reasonable expenses of administering the Plan.



     Section 8.4. If the Plan is terminated in whole or in part, the Trustee
shall distribute the Fund or any part thereof in such manner and at such times
as the Plan Administrator shall direct in writing in accordance with the
provisions of the Plan; provided, however, that the Trustee may delay
distribution of the Fund until it has received from the Company a copy of an
Internal Revenue Service determination letter addressing the Plan’s
tax-qualified status upon termination, or, in lieu thereof at the Trustee’s
sole discretion, an opinion from the Company’s legal counsel that the Plan met
all qualification requirements at the date of termination.



ARTICLE IX

MISCELLANEOUS PROVISIONS




     Section 9.1. Unless the context of this Agreement clearly indicates
otherwise, the terms defined in the Plan shall, when used herein, have the same
meaning as in the Plan.



     Section 9.2. Except as otherwise required by law in the case of any
qualified domestic relations order within the meaning of Section 414(p) of the
Code, to the extent of any offset of a Participant’s benefits as a result of
any judgment, order, decree or settlement agreement provided in Section
401(a)(13)(C) of the Code, or any federal tax levy made pursuant to Section
6331 of the Code, or except as otherwise provided in the Plan with respect to
any loan to a leveraged ESOP described in Section 4975(d)(3) of the Code or
loan from the Fund to a participant in accordance with the provisions of the
Plan, the benefits or proceeds of any allocated or unallocated portion of the
assets of the Fund and any interest of any participant or beneficiary arising
out of or created by the Plan either before or after the participant’s
retirement shall not be subject to execution, attachment, garnishment or other
legal or judicial process whatsoever by any person, whether creditor or
otherwise, claiming against such participant or beneficiary. Except as
otherwise provided in the Plan with respect to any loan from the Fund to a
participant in accordance with the provisions of the Plan, no participant or
beneficiary shall have the right to alienate, encumber or assign any of the
payments or proceeds or any other interest arising out of or created by the
Plan and any action purporting to do so shall be void. The provisions of this
Section shall apply to all participants and beneficiaries, regardless of their
citizenship or place of residence.



     Section 9.3. Any person dealing with the Trustee may rely upon a copy of
this Agreement and any amendments thereto certified to be true and correct by
the Trustee.



     Section 9.4. The Trustee hereby acknowledges receipt of a copy of the
Plan. The Company will cause a copy of any amendment to the Plan to be
delivered to the Trustee.



     Section 9.5. The construction, validity and administration of this
Agreement shall be governed by ERISA and, to the extent not preempted by ERISA,
the laws of the State of ____ without regard to its rules regarding conflict
of laws.



9









 





     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in their respective names by their duly authorized officers under
their corporate seals as of the day and year first above written.



	 	 	 	 	 
	 	 	FIRST FEDERAL SAVINGS BANK
	 
	 	 	 	 
	

	 	BY:
	 	 
	

	 	 	 	

	 
	 	 	 	 
	

	 	 	 	
           PRINT
NAME
	 
	 	 	 	 
	

	 	 	 	
           TITLE
	 
	 	 	 	 
	 	 	[TRUST COMPANY]
	 
	 	 	 	 
	

	 	BY:
	 	 
	

	 	 	 	

	 
	 	 	 	 
	

	 	 	 	
           PRINT
NAME
	 
	 	 	 	 
	

	 	 	 	
           TITLE







10









 






	 	 	 	 	 
	STATE OF
	
	)	 	 
	

	 	:	 	ss.:
	COUNTY OF
	 	)	 	 






     On this            day of      , in the year 2005, before me, the
undersigned, a Notary Public in and for the said state, personally appeared
        , personally known to me or proved to me on the
basis of satisfactory evidence to be the person(s) whose name(s) is (are)
subscribed to the within instrument and acknowledged to me that he/she/they
executed the same in his/her/their capacity(ies) and that by his/her/their

signature(s) on the instrument, the person(s) or the entity upon behalf of
which the person(s) acted, executed the instrument.



	 	 
	SEAL:	

	 	Notary Public of

	 	My Commission expires







	 	 	 	 	 
	STATE OF
	
	)	 	 
	

	 	:	 	ss.:
	COUNTY OF
	
	)	 	 







     On this            day of      , in the year 2005, before me, the
undersigned, a Notary Public in and for the said state, personally appeared
        , personally known to me or proved to me on
the basis of satisfactory evidence to be the person(s) whose name(s) is (are)
subscribed to the within instrument and acknowledged to me that he/she/they
executed the same in his/her/their capacity(ies) and that by
his/her/their

signature(s) on the instrument, the person(s) or the entity upon behalf of
which the person(s) acted, executed the instrument.




	 	 
	SEAL:	

	 	Notary Public of

	 	My Commission expires







11