Officers' Deferred Compensation Plan

                                     of

                    Westborough Financial Services, Inc.


                       _____________________________


                     Effective as of  January 1, 2001

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                              TABLE OF CONTENTS

                                                                       Page
                                                                       ----

                                  Article I
                                 Definitions

Section 1.1   401(k) Plan                                                1
Section 1.2   Administrator                                              1
Section 1.3   Bank                                                       1
Section 1.4   Beneficiary                                                1
Section 1.5   Board                                                      1
Section 1.6   Code                                                       1
Section 1.7   Committee                                                  1
Section 1.8   Company                                                    1
Section 1.9   Compensation                                               1
Section 1.10  Effective Date                                             1
Section 1.11  Elective Deferred Compensation                             1
Section 1.12  Hardship                                                   2
Section 1.13  Investment Fund                                            2
Section 1.14  Memorandum Account                                         2
Section 1.15  Officer                                                    2
Section 1.16  Participant                                                2
Section 1.17  Participating Company                                      2
Section 1.18  Plan                                                       2

                                 Article II
                                Participation

Section 2.1   Election to Participate                                    2
Section 2.2   Changes in Participation                                   3

                                 Article III
                               Deferred Amounts

Section 3.1   In General                                                 3
Section 3.2   Adjustments to Memorandum Accounts                         3
Section 3.3   Vesting                                                    4

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                                 Article IV
                                    Trust

Section 4.1   Establishment of Trust                                    4
Section 4.2   Contributions to Trust                                    4
Section 4.3   Unfunded Character of Plan                                5

                                 Article V
                               Distributions

Section 5.1   Hardship Distributions                                    5
Section 5.2   Distributions to Participants                             5
Section 5.3   Distributions to Beneficiaries                            6

                                 Article VI
                         Amendment and Termination

Section 6.1   Amendment by the Company                                  6
Section 6.2   Termination                                               6
Section 6.3   Amendment or Termination by Other Employers               7

                                Article VII
                         Miscellaneous Provisions

Section 7.1   Notice and Election                                       7
Section 7.2   Construction and Language                                 7
Section 7.3   Headings                                                  7
Section 7.4   Non-Alienation of Benefits                                7
Section 7.5   Indemnification                                           8
Section 7.6   Severability                                              8
Section 7.7   Waiver                                                    8
Section 7.8   Governing Law                                             8
Section 7.9   Withholding                                               8
Section 7.10  No Deposit Account                                        9
Section 7.11  Rights of Employees                                       9
Section 7.12  Status of Plan Under ERISA                                9
Section 7.13  Successors and Assigns                                    9

<PAGE>  (iii)


                    Officers' Deferred Compensation Plan

                                     of

                    Westborough Financial Services, Inc.

                                  Article I

                                 Definitions

      The following definitions shall apply for the purposes of this Plan
unless a different meaning is clearly indicated by the context:

      Section 1.1  401(k) Plan means the SBERA 401(k) Plan as adopted by
Westborough Financial Services, Inc or an affiliate thereof.

      Section 1.2  Administrator means any person, committee, corporation or
organization appointed by the Committee to perform the responsibilities
assigned to the Administrator hereunder.

      Section 1.3  Bank means Westborough Bank or any successor thereto.

      Section 1.4  Beneficiary means the person or persons designated by the
Participant under section 5.3(a) of the Plan.

      Section 1.5  Board means the Board of Directors of the Company.

      Section 1.6  Code means the Internal Revenue Code of 1986 (including
the corresponding provisions of any succeeding law).

      Section 1.7  Committee means the Compensation Committee of the Board.

      Section 1.8  Company means, Westborough Financial Services, Inc., a
Massachusetts corporation, or any successor hereto.

      Section 1.9  Compensation means, during any period, the compensation
earned by an Officer for service to any Participating Company that would be
reportable to the Internal Revenue Service as wages for such period on Form
W-2 in the absence of an election to defer receipt of such under the terms
of this Plan.

      Section 1.10  Effective Date means January 1, 2001.

      Section 1.11  Elective Deferred Compensation means, for any
Participant for any period, such portion of the Compensation earned by the
Participant the receipt of which is deferred pursuant to an election made
under this Plan.

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      Section 1.12  Hardship means, with respect to any Participant, an
unanticipated emergency caused by an event beyond the control of the Officer
which results in an immediate and heavy financial need of the Officer.  The
existence of a Hardship shall be determined by the Committee in its sole and
absolute discretion.

      Section 1.13  Investment Fund means a hypothetical investment
classification in which a Participant's Memorandum Account shall be deemed
to be invested for purposes of crediting or charging earnings, losses,
appreciation or depreciation with respect to the Participant's Memorandum
Account, in accordance with section 3.2(c) which shall consist of the
investment funds established from time to time under the 401(k) Plan unless
otherwise designated by the Committee.

      Section 1.14  Memorandum Account means, with respect to a Participant,
an account maintained by the Company to which is credited the amount of the
Participant's Elective Deferred Compensation, together with any earnings and
appreciation thereon, and against which are charged any losses, depreciation
or distributions thereof, pursuant to Section 3.2 and Article V.

      Section 1.15  Officer means the Chief Executive Officer of the Bank or
the Company and such other officers of the Bank or any other Participating
Company that is selected for participation hereunder by the Committee;
provided, however, that no person shall be named an Officer, nor shall any
person who has been an Officer continue as an Officer for purposes of the
Plan, to the extent that such person's participation, or continued
participation, in the Plan would cause the Plan to fail to be considered
maintained for the primary purpose of providing deferred compensation for a
select group of management or highly compensated employees for purposes of
ERISA.

      Section 1.16  Participant means an Officer or former Officer who has a
Memorandum Account under the Plan.

      Section 1.17  Participating Company means the Bank, the Company and
any other company which, with the prior approval of the Company, may adopt
this Plan.

      Section 1.18  Plan means the Officers' Deferred Compensation Plan of
Westborough Financial Services, Inc.

                                 Article II

                               Participation

      Section 2.1  Election to Participate.

      (a)   Any Officer may elect to become a Participant in the Plan by
submitting to the Administrator a written election, on a form prescribed by
the Administrator, to defer the receipt of all or any portion of his
Compensation; provided, however, that no Officer shall be permitted to defer
receipt of Compensation that is required to be withheld and remitted to any
federal, state or local taxing authority pursuant to any requirement for the
collection of tax at the source and that is

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required to fund any contribution required of the Officer as a condition of
participation in any employee benefit plan maintained by the Bank or any
other Participating Company.

      (b)   An election made pursuant to this section 2.1 shall be made on
or before the last day of any calendar year and shall be effective for the
calendar year following the calendar year in which such election is made and
all subsequent calendar years unless status as an Officer ceases or a change
in the rate of deferral is elected pursuant to section 2.2, provided
however, that an initial election made by an Officer and filed with the
Administrator during the thirty (30) day period immediately following the
later of the Effective Date of the Plan or the date the Officer first
becomes an Officer shall take effect with the first payment of Compensation
to be made after the date such election is filed with the Administrator.

      Section 2.2  Changes in Participation.

      An election by an Officer pursuant to section 2.1 shall continue in
effect until such termination of status as an Officer;  provided, however,
that the Officer may, by written election filed with the Administrator,
increase or decrease the portion of his Compensation to be deferred, or
discontinue such deferral altogether. Such election shall be effective with
respect to  Compensation payable after the calendar year in which such
election is filed with the Administrator; provided, however, that if an
election provides for the decrease or discontinuance of the Officer's
deferral of Compensation and is made on account of a Hardship, such election
shall be effective with respect to Compensation earned and payable after the
filing of such election.  In the event that a Participant ceases to be an
Officer or in the event that an Officer ceases to defer receipt of his
Compensation, the balance in his Memorandum Account shall continue to be
adjusted in accordance with Article III.  An Officer who has filed a written
election to cease deferring receipt of his Deferrable Compensation may
thereafter again file an election to defer receipt of his Deferrable
Compensation in the same manner described in section 2.1, effective for the
calendar year subsequent to the calendar year in which he files the new
election.

                                 Article III

                              Deferred Amounts

      Section 3.1  In General.

      The Administrator shall maintain a separate Memorandum Account for
each Participant.  Credits, charges, and other adjustments to each
Participant's Memorandum Account shall be made in accordance with this
Article III.  Neither the Bank nor any other Participating Company shall
fund its liability for the balances credited to a Memorandum Account, but
each shall reflect its liability for such balances on its books.

      Section 3.2  Adjustments to Memorandum Accounts.

      (a)   Each Participant's Memorandum Account shall be deemed to be
invested in the Investment Fund or Investment Funds designated by the
Participant in the appropriate election form filed with the Administrator.

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      (b)   Each Participant's Memorandum Account shall be adjusted to
reflect an amount of earnings, losses, appreciation or depreciation, as
appropriate with respect to the Investment Fund or Investment Funds in which
the Participant's Memorandum Account is deemed to be invested.

      (c)   The Memorandum Account established for each Participant shall be
adjusted from time to time, but in no event less frequently than monthly to
reflect:

            (i)   credits of Elective Deferred Compensation;

            (ii)  credits reflecting income, dividends and appreciation
      attributable to the applicable Investment Funds;

            (iii) charges for losses or depreciation attributable to the
      applicable Investment Funds; and

            (iv)  charges for payments to the Participant or his
      Beneficiary.

      Section 3.3  Vesting.

      All amounts credited to a Participant's Memorandum Account shall be
100% vested at all times.

                                 Article IV

                                   Trust

      Section 4.1  Establishment of Trust.

      The Company may establish a trust fund which may be used to accumulate
funds to satisfy benefit liabilities to Participants, Former Participants
and their Beneficiaries under the Plan; provided, however, that the assets
of such trust shall be subject to the claims of the creditors of the Company
in the event that it is determined that the Company is insolvent; and
provided, further, that the trust agreement shall contain such terms,
conditions and provisions as shall be necessary to cause the Company to be
considered the owner of the trust fund for federal, state or local income
tax purposes with respect to all amounts contributed to the trust fund or
any income attributable to the investments of the trust fund.  The Company
shall pay all costs and expenses incurred in establishing and maintaining
such trust.  Any payments made to a Participant, Former Participant  or
Beneficiary from a trust established under this section 4.1 shall offset
payments which would otherwise be payable by the Company in the absence of
the establishment of such trust.  Any such trust will conform to the terms
of the model trust prescribed by Revenue Procedure 92-64, as the same may be
modified from time to time.

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      Section 4.2  Contributions to Trust.

      If a trust is established in accordance with section 4.1, the Company
shall make contributions to such trust in such amounts and at such times as
may be specified by the Committee.

      Section 4.3  Unfunded Character of Plan.

      Notwithstanding the establishment of a trust pursuant to section 4.1,
the Plan shall be unfunded.  Any liability of the Bank or another
Participating Company to any person with respect to benefits payable under
the Plan shall be based solely upon such contractual obligations, if any, as
shall be created by the Plan, and shall give rise only to a claim against
the general assets of the Bank or such Participating Company.  No such
liability shall be deemed to be secured by any pledge or any other
encumbrance on any specific property of the Bank or any other Participating
Company.

                                 Article V

                               Distributions

      Section 5.1  Hardship Distributions.

      In the event that a Participant has incurred a Hardship, as defined in
Section 1.12, the Committee may, in its sole discretion, allow such
Participant to obtain a lump sum withdrawal of an amount credited to his
Memorandum Account that does not exceed the amount necessary to alleviate
the Hardship.

      Section 5.2  Distributions to Participants.

      (a)   Upon a Participant's termination of service with the Bank and
all other Participating Companies, an amount equal to the balance credited
to such Participant's Memorandum Account shall be paid in cash to the
Participant in a lump sum payment within thirty (30) days after the end of
calendar year in which such termination of service occurs; provided,
however, that if a Participant so elects within thirty (30) days after first
becoming a Participant, payment may be made in a lump sum as of some other
date (not later than the last day of the calendar  year in which the
Participant attains age 70 or terminates service with all Participating
Employers, whichever is later) specified by the Participant in his election
or in annual installments over such number of years (not to exceed five (5))
and payable beginning on such date (not later than the last day of the
calendar  year in which the Participant attains age 70 or terminates service
with all Participating Employers, whichever is later) specified by the
Participant in his election.  In the event payment is to be made in
installments, each installment shall be equal to the balance credited to the
Participant's Memorandum Account as of the last day of the month ending
immediately prior to the date on which payment is to be made, divided by the
number of installment payments remaining to be paid (including the payment
then being computed).  Any portion of the balance credited to the
Participant's Memorandum Account with respect to which a payment has not
been made shall continue to be adjusted pursuant to section 3.2, in
accordance with the Investment Funds in which

<PAGE>  5


the Participant's Memorandum Account is deemed to be invested, until a
distribution with respect to such amount has been made.

      (b)   Distributions shall be made, or commence, within 30 days of the
date the Participant becomes entitled to payment pursuant to this Section
5.2.

      Section 5.3  Distributions to Beneficiaries.

      (a)   A Participant may designate a Beneficiary or Beneficiaries by
filing a written notice with the Administrator prior to the Participant's
death, in such form and manner as the Administrator may prescribe.  A
Participant who has designated a Beneficiary or Beneficiaries may change or
revoke such designation prior to the Participant's death by means of a
similar written instrument.

      (b)   In the event that a Participant dies before receiving payment of
his entire Memorandum Account, payment of the value of the deceased
Participant's Memorandum Account shall be made in a lump sum to his
Beneficiary or Beneficiaries. If no Beneficiary shall have been designated
or if any such designation shall be ineffective, or in the event that no
designated Beneficiary survives the Participant, payment of the value of the
Participant's Memorandum Account shall be made to the Participant's personal
representative, or if no personal representative is appointed within 6
months of the Participant's death, to his surviving spouse, or if he has no
surviving spouse, to his then living descendants, per stirpes, in the same
manner and at the same time as the Participant's Memorandum Account would
have been paid to the Participant had he lived.  If any Participant and any
one or more of his designated Beneficiary shall die in circumstances that
leave substantial doubt as to who shall have been the first to die, the
Participant shall be deemed to have survived the deceased Beneficiary(ies).
 The presence of substantial doubt for such purposes shall be determined by
the Committee in its sole and absolute discretion.

                                 Article VI

                          Amendment and Termination

      Section 6.1  Amendment by the Company.

      The Company reserves the right, in its sole and absolute discretion,
at any time and from to time, by action of the Board, to amend the Plan in
whole or in part.  In no event, however, shall any such amendment adversely
affect the right of any Participant, Former Participant or Beneficiary to
receive any benefits under the Plan in respect of participation for any
period ending on or before the later of the date on which such amendment is
adopted or the date on which it is made effective.

<PAGE  6


      Section 6.2  Termination.

      The Company also reserves the right, in its sole and absolute
discretion, by action of the Board, to terminate the Plan.  In such event,
undistributed benefits attributable to participation prior to the date of
termination shall be distributed as though each Participant terminated
employment with the Bank, the Company and all other Participating Employers
as of the effective date of termination of the Plan.

<PAGE>  7


      Section 6.3  Amendment or Termination by Other Employers.

      In the event that a corporation or trade or business other than the
Company shall adopt this Plan, such corporation or trade or business shall,
by adopting the Plan, empower the Company to amend or terminate the Plan,
insofar as it shall cover employees of such corporation or trade or
business, upon the terms and conditions set forth in sections 6.1 and 6.2;
provided, however, that any such corporation or trade or business may, by
action of its board of directors or other governing body, amend or terminate
the Plan, insofar as it shall cover employees of such corporation or trade
or business, at different times and in a different manner.  In the event of
any such amendment or termination by action of the board of directors or
other governing body of such a corporation or trade or business, a separate
plan shall be deemed to have been established for the employees of such
corporation or trade or business, and any amounts set aside to provide for
the satisfaction of benefit liabilities with respect to employees of such
corporation or trade or business shall be segregated from the assets set
aside for the purposes of this Plan at the earliest practicable date and
shall be dealt with in accordance with the documents governing such separate
plan.

                                 Article VII

                          Miscellaneous Provisions

      Section 7.1  Notice and Election.

      The Committee shall provide a copy of this Plan and the resolutions of
adoption to each Officer who becomes eligible to participate, together with
a form on which the Officer may notify the Committee of his election whether
to become a Participant, which form, if he so elects, he may complete, sign
and return to the Committee.

      Section 7.2  Construction and Language.

      Wherever appropriate in the Plan, words used in the singular may be
read in the plural, words used in the plural may be read in the singular,
and the masculine gender may be read as referring equally to the feminine
gender or the neuter.  Any reference to an Article or section shall be to an
Article or section of the Plan, unless otherwise indicated.  If there is any
conflict between such headings and the text of the Plan, the text shall
control.

      Section 7.3  Headings.

      The headings of Articles and sections are included solely for
convenience of reference.  If there is any conflict between such headings
and the text of the Agreement, the text shall control.

      Section 7.4  Non-Alienation of Benefits.

      Except as may otherwise be required by law, no distribution or payment
under the Plan to any Participant or Beneficiary shall be subject in any
manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance or charge, whether voluntary or involuntary, and any

<PAGE>  8


attempt to so anticipate, alienate, sell, transfer, assign, pledge, encumber
or charge the same shall be void; nor shall any such distribution or payment
be in any way liable for or subject to the debts, contracts, liabilities,
engagements or torts of any person entitled to such distribution or payment.
 If any Participant, Former Participant or Beneficiary is adjudicated
bankrupt or purports to anticipate, alienate, sell, transfer, assign, pledge
encumber or charge any such distribution or payment, voluntarily or
involuntarily, the Committee, in its sole discretion, may cancel such
distribution or payment or may hold or cause to be held or applied such
distribution or payment, or any part thereof, to or for the benefit of such
Participant, Former Participant or Beneficiary, in such manner as the
Committee shall direct; provided, however, that no such action by the
Committee shall cause the acceleration or deferral of any benefit payments
from the date on which such payments are scheduled to be made.

      Section 7.5  Indemnification.

      The Company shall indemnify, hold harmless and defend each Participant
and Beneficiary, against their reasonable costs, including legal fees,
incurred by them or arising out of any action, suit or proceeding in which
they may be involved, as a result of their efforts, in good faith, to defend
or enforce the obligations of the Bank, the Company and any other
Participating Employer under the terms of the Plan.

      Section 7.6  Severability.

      A determination that any provision of the Plan is invalid or
unenforceable shall not affect the validity or enforceability of any other
provision hereof.

      Section 7.7  Waiver.

      Failure to insist upon strict compliance with any of the terms,
covenants or conditions of the Plan shall not be deemed a waiver of such
term, covenant or condition.  A waiver of any provision of the Plan must be
made in writing, designated as a waiver, and signed by the party against
whom its enforcement is sought.  Any waiver or relinquishment of any right
or power hereunder at any one or more times shall not be deemed a waiver or
relinquishment of such right or power at any other time or times.

      Section 7.8  Governing Law.

      The Plan shall be construed, administered and enforced according to
the laws of the Commonwealth of Massachusetts without giving effect to the
conflict of laws principles thereof, except to the extent that such laws are
preempted by federal law.  Any payments made pursuant to this Plan are
subject to and conditioned upon their compliance with 12 U.S.C. Section
1828(k) and any regulations promulgated thereunder.

      Section 7.9  Withholding.

      Payments from this Plan shall be subject to all applicable federal,
state and local income withholding and employment taxes.

<PAGE>  9


      Section 7.10  No Deposit Account.

      Nothing in this Plan shall be held or construed to establish any
deposit account for any Participant or any deposit liability on the part of
the Bank.  Participants' rights hereunder shall be equivalent to those of a
general unsecured creditor of each Employer.

      Section 7.11  Rights of Employees.

      No Employee shall have any right or claim to any benefit under the
Plan except in accordance with the provisions of the Plan.  The
establishment of the Plan shall not be construed as conferring upon any
Employee or other person any legal right to a continuation of employment or
to any terms or conditions of employment, nor as limiting or qualifying the
right of a Participating Employer to discharge any Employee.

      Section 7.12  Status of Plan Under ERISA.

      The Plan is intended to be (a) to the maximum extent permitted under
applicable laws, an unfunded, non qualified excess benefit plan as
contemplated by section 3(36) of ERISA for the purpose of providing benefits
in excess of the limitations imposed under section 415 of the Code, and (b)
to the extent not so permitted, an unfunded, non qualified plan maintained
primarily for the purpose of providing deferred compensation for highly
compensated employees, as contemplated by sections 201(2), 301(a)(3) and
401(a)(1) of ERISA.  The Plan is not intended to comply with the
requirements of section 401(a) of the Code or to be subject to Parts 2, 3
and 4 of Title I of ERISA.  The Plan shall be administered and construed so
as to effectuate this intent.

      Section 7.13  Successors and Assigns.

      The provisions of the Plan will inure to the benefit of and be binding
upon the Participants and their respective legal representatives and testate
or intestate distributes, and each Participating Company and their
respective successors and assigns, including any successor by merger or
consolidation or a statutory receiver or any other person or firm or
corporation to which all or substantially all of the assets and business of
any Participating Company may be sold or otherwise transferred.

<PAGE>  10