# UNITED STATES
SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549

|FORM 10-K/A       
|------------------
|Amendment No. 1 to

|[X] | Annual
Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act                of
1934  For the fiscal year ended December 31, 2007 Commission File
               Number 005-78774
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# OR

|[_] | Transition
Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act                of
1934 for the period from  __________ to __________.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------

# Commission File Number
005-78774

|TierOne Corporation                                   
|------------------------------------------------------
|(Exact name of registrant as specified in its charter)

|Wisconsin                | 04-3638672                             
|------------------------ | ---------------------------------------
|(State of Incorporation) | (I.R.S. Employer Identification Number)

# Registrants
Address of Principal Executive Offices: 1235 N Street, Lincoln, Nebraska 68508  Registrants
Telephone Number, including area code: (402) 475-0521  Securities registered pursuant to
Section 12(b) of the Act: Title of Class Common Stock, Par Value $0.01 Per Share
  Securities registered pursuant to Section 12(g) of the
Act: None

Indicate by check mark whether the
Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes |X|      No |_|

Indicate by check mark if the
Registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act.

Yes |_|      No |X|

Indicate by check mark whether the
Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

Yes |X|     No |_|

Indicate by check mark if disclosure
of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and
will not be contained, to the best of the Registrants knowledge, in definitive proxy
or information statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. |_|

Indicate by check mark whether the
Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or
a smaller reporting company. See definitions of large accelerated filer,
accelerated filer, and smaller reporting company in Rule 12b-2 of
the Exchange Act. (Check one):

Large accelerated filer    |_|
           Accelerated filer    |X|           Non-accelerated filer    |_|         Smaller reporting
company    |_|

Indicate by check mark whether the
Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes |_|      No |X|

The aggregate market value of the
voting stock held by non-affiliates of the Registrant was $543,431,480 as of June 30,
2007. As of April 25, 2008 there were 18,036,134 issued and outstanding shares of the
Registrants common stock.

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# Documents Incorporated
by Reference: None.

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# EXPLANATORY NOTE

On March 11, 2008, the undersigned
registrant filed its Annual Report on Form 10-K for the fiscal year ended December 31,
2007. The registrant hereby supplements the original Annual Report on Form 10-K by amending and
restating Part III and Part IV of the Form 10-K in their entirety to provide the
information that the registrant indicated it would incorporate by reference from its Proxy
Statement for the 2008 Annual Meeting of the Shareholders unless the Proxy Statement would
not be filed by April 29, 2008 in which case the registrant would amend the Form 10-K to
provide the omitted information.

This Amendment No. 1 to the Annual
Report on Form 10-K/A does not reflect events occurring after the filing of the original
Annual Report on Form 10-K and, other than amending and restating Part III and Part IV,
does not modify or update the disclosures in the original Annual Report on Form 10-K in
any way.

# PART III

# Item 10. Directors,
Executive Officers and Corporate Governance

# Board of Directors

The following sets forth certain
information regarding the Directors of the Company (ages are reflected as of March 12,
2008):

Gilbert G. Lundstrom, Esq.,
age 66. Chairman of the Board and Chief Executive Officer of TierOne Corporation since
April 2002 and TierOne Bank since October 2001; prior thereto Mr. Lundstrom served as
Chairman of the Board, President and Chief Executive Officer from September 1999. From
1996 to 1999, he served as Director, President and Chief Executive Officer of TierOne
Bank. He joined TierOne Bank in 1994. He was a director of the Federal Home Loan Bank of
Topeka and served on the Board of Directors of Sahara Enterprises, Inc., Chicago,
Illinois. Prior to 1994, he was the managing partner of Woods & Aitken Law Firm,
Lincoln, Nebraska, where he practiced law for 25 years. Woods & Aitken serves as
general counsel to TierOne Bank. Mr. Lundstrom has been a Director of TierOne Bank since
1994.

Charles W. Hoskins, age 71.
Director. Self-employed financial advisor; retired partner of Deloitte & Touche LLP
having last served as National Director of Japanese Business Development, Los Angeles,
California. Mr. Hoskins has been a Director of TierOne Bank since 2004.

James A. Laphen, age 59.
Director. President and Chief Operating Officer of TierOne Corporation since April 2002
and TierOne Bank since October 2001. Mr. Laphen joined TierOne Bank in September 2000 as
Senior Executive Vice President and Chief Operating Officer. Prior thereto he served as
President and Chief Operating Officer of Commercial Federal Bank, Omaha, Nebraska, from
1994 to July 2000. Mr. Laphen has been a Director of TierOne Bank since 2000.

Campbell R. McConnell, age 79.
 Director. Retired; currently Professor Emeritus of Economics, University of
Nebraska-Lincoln.  Dr. McConnell has been a Director of TierOne Bank since 1974.

Joyce Person Pocras, age 65.
Director. CPA (inactive), independent investor; retired in 1993 as the internal auditor of
First Federal Lincoln Bank, now known as TierOne Bank. Ms. Pocras has been a Director of
TierOne Bank since 1994.

Ann Lindley Spence, age 73.
 Director. Retired; previously, President of Spence Title Services, Inc., a title
insurance company located in Omaha, Nebraska.  Ms. Spence has been a Director of TierOne
Bank since 1989.

With
the exception of Mr. Hoskins who was elected as a director in 2004, all existing directors
have served as directors of TierOne Corporation since 2002, the year our Company was
formed.

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# Executive Officers Who
Are Not Directors

Set forth below is the information
with respect to the principal occupations during the last five years for the six executive
officers of TierOne Bank who do not serve as directors. Mr. Witkowicz also serves as an
executive officer of TierOne Corporation. The other executive officers of TierOne
Corporation are Messrs. Lundstrom and Laphen. Ages are reflected as of March 12, 2008.

|Name                | Age | Principal Occupation During the Past Five Years                              
|------------------- | --- | -----------------------------------------------------------------------------
|Eugene B. Witkowicz | 60  | Executive Vice President, Chief Financial Officer, Corporate Secretary and   
|                    |     | Treasurer of TierOne Corporation since 2003 and Executive Vice President,    
|                    |     | Corporate Secretary, Treasurer and Director of Finance of TierOne Bank since 
|                    |     | 2001. Previously, Executive Vice President, Treasurer and Chief Financial    
|                    |     | Officer since 1992. Mr. Witkowicz joined TierOne Bank in 1972.               
|Gale R. Furnas      | 54  | Executive Vice President and Director of Lending of TierOne Bank since 1998. 
|                    |     | Previously, Senior Vice President/Loan Sales Manager and Assistant Director  
|                    |     | of Lending since 1996. Mr. Furnas joined TierOne Bank in 1976.               
|Roger R. Ludemann   | 59  | Executive Vice President and Director of Retail Banking of TierOne Bank since
|                    |     | 2000. Previously, Executive Vice President and Director of Consumer Services 
|                    |     | since 1997. Mr. Ludemann joined TierOne Bank in 1995.                        
|Larry L. Pfeil      | 65  | Executive Vice President and Director of Administration of TierOne Bank since
|                    |     | 2000. Previously, Executive Vice President and Director of Financial         
|                    |     | Services of TierOne Bank since 1982. Mr. Pfeil joined TierOne Bank in 1971.  
|David L. Kellogg    | 49  | Senior Vice President and Controller of TierOne Bank since March 2004; prior 
|                    |     | thereto, Controller of TierOne Bank since September 2003; Client Relationship
|                    |     | Manager, Fiserv, Inc., a banking software and services company, from 2001 to 
|                    |     | 2003; Assistant Corporate Controller, Commercial Federal Bank, Omaha,        
|                    |     | Nebraska, from 1982 to 2001.                                                 
|Edward J. Swotek    | 46  | Senior Vice President and Strategic Planning and Investor Relations Officer  
|                    |     | of TierOne Bank since August 2005; prior thereto, Senior Vice President and  
|                    |     | Strategic Planning Officer since 2000. Mr. Swotek joined TierOne Bank in     
|                    |     | 1987.                                                                        

# Meetings and Committees
of the Board of Directors

During the year ended December 31,
2007, the Board of Directors of TierOne Corporation and TierOne Bank met 17 times. All
directors of TierOne Corporation attended all of the Board meetings held during the year
and all of the meetings held by all committees of the Board on which he/she served either
in person or by telephone to accomodate scheduling conflicts. The Board of Directors of
TierOne Corporation has standing Audit, Compensation and Nominating and Corporate
Governance Committees.

Although we do not have a formal
policy regarding attendance by members of the Board of Directors at Annual Meetings of
Shareholders, we typically schedule a Board meeting in conjunction with our Annual Meeting
of Shareholders and expect that our directors will attend, absent a valid reason for not
doing so. All of our directors attended our Annual Meeting of Shareholders held on May 15,
2007.

3

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# Section 16(a) Beneficial
Ownership Reporting Compliance

Section
16(a) of the Securities Exchange Act of 1934, as amended, requires our officers and
directors, and persons who own more than 10% of our common stock, to file reports of
ownership and changes in ownership with the Securities and Exchange Commission. Officers,
directors and greater than 10% shareholders are required by regulation to furnish us with
copies of all Section 16(a) forms they file. We know of no person who owns more than 10%
of our common stock for purposes of Section 16(a).

Based
solely on our review of the copies of reports of ownership and changes in ownership that
were furnished to us, or written representations from our officers and directors that no
reports were required to be filed because they had no change in their ownership, we
believe that during, and with respect to, the fiscal year ended December 31, 2007, our
officers and directors complied in all respects with the reporting requirements
promulgated under Section 16(a) of the Securities Exchange Act of 1934.

# Code of Ethics

We
have adopted a Code of Conduct and Ethics that applies to our Chief Executive Officer and
Chief Financial Officer, as well as other officers and employees of the Company and the
Bank. A copy of the Code of Conduct and Ethics may be found on our website at
www.tieronebank.com. We intend to satisfy the disclosure requirements under Item
5.05 of Form 8-K regarding amendments to, or waivers from, the Code of Conduct and Ethics
by posting such information on our website.

# Audit Committee

The
Audit Committees primary duties and responsibilities are to: appoint the independent
auditors; monitor the integrity of the financial reporting process and systems of internal
controls regarding finance, accounting, legal and regulatory compliance; monitor the
qualifications, independence and performance of the independent auditors and internal
auditing department; and provide an avenue of communication among the independent
auditors, management, the internal auditing department and the Board of Directors. The
Audit Committee is comprised of four independent directors as defined in
the listing standards of NASDAQ and rules of the Securities and Exchange Commission. The
current members of the Audit Committee are Directors Hoskins, Spence, Pocras and McConnell
(Chairman). The Board of Directors has determined that Ms. Pocras and Mr. Hoskins meet the
Securities and Exchange Commissions definition of audit committee financial expert.
The Audit Committee of TierOne Corporation met six times in 2007.

# Item 11. Executive
Compensation

# Compensation Discussion
and Analysis

# Overview

The
Compensation Committee of our Board of Directors, together with the administrators of the
Companys 2003 Stock Option Plan and the 2003 Recognition and Retention Plan and
Trust Agreement, set and administer the policies that govern our executive compensation,
including:

| |  | Establishing
and reviewing executive base salaries;
| | - | ---------------------------------------------------

| |  | Overseeing
our annual incentive compensation plan;
| | - | --------------------------------------------------

| |  | Overseeing
our long-term equity-based compensation plans;
| | - | ---------------------------------------------------------

| |  | Approving
all bonuses and awards under these plans; and
| | - | -------------------------------------------------------

| |  | Annually
approving and recommending to the Board all compensation decisions for executive
officers, including those for the Chief Executive Officer, the Chief Operating Officer
and the other officers named in the Summary Compensation Table (referred to as the named
executive officers).
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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The
Compensation Committee maintains overall responsibility for our executive compensation policies and seeks to assure that compensation paid to the named executive
officers is fair, reasonable and competitive, and is linked to increasing long-term
shareholder value. Additionally, compensation consideration for the named executive
officers in 2007 was partially dictated pursuant to the terms and conditions of a proposed
merger agreement. The merger agreement was subsequently terminated in early 2008.

As
appropriate, references to the Compensation Committee herein may also include the
administrators of the Companys 2003 Stock Option Plan and the 2003 Recognition and
Retention Plan and Trust Agreement.

# Executive
Compensation Philosophy

We
understand the importance of maintaining an effective executive compensation and benefits
program to advance the long-term performance of TierOne Corporation and TierOne Bank. We
adhere to the following core principles to guide our decisions regarding these programs:

| |  | The
interests of our executives are aligned with those of our shareholders through existing
and potential stock ownership and by linking management incentives to shareholder return;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Rewards
are closely linked to company-wide and individual performance;
| | - | ----------------------------------------------------------------------

| |  | Incentives
are provided to promote the achievement of successful annual results as a step toward
fulfilling our long-term operating goals and strategic objectives;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | The
structure of executive officers' compensation aligns with short-term and long-term goals
and objectives; and
| | - | ----------------------------------------------------------------------------------------------------------------

| |  | We
provide executive compensation that is comparable to other financial institutions of our
relevant size to ensure that we are able to attract, retain and motivate top performing
executive officers in a cost-effective manner for the long-term success of TierOne
Corporation and TierOne Bank.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

We
believe that implementing an executive compensation and benefits program that is focused
on achieving these core principles will benefit the Company, and ultimately our shareholders, over
the long-term by attracting and retaining highly qualified and industry-experienced
executives who are committed to our continued growth and long-term success.

To
balance all these objectives, our executive compensation program uses the following
elements:

| |  | Base
salary, to provide a fixed compensation level competitive in the marketplace;
| | - | ----------------------------------------------------------------------------------

| |  | Annual
incentive compensation plan, to reward short-term performance against specific financial
targets;
| | - | --------------------------------------------------------------------------------------------------------

| |  | Long-term
equity incentive compensation, to link management incentives to shareholder return; and
| | - | -------------------------------------------------------------------------------------------------

| |  | Retirement,
perquisites and other benefits, to attract and retain management and other employees over
the longer term.
| | - | ----------------------------------------------------------------------------------------------------------------------

# Role of the
Compensation Committee

The
Compensation Committee is responsible for, among other things, developing executive
compensation policies for TierOne Corporation, TierOne Bank and subsidiaries. As part of
its responsibilities, the Compensation Committee sets compensation for all of the
executive officers of TierOne Corporation and TierOne Bank, including the named executive
officers. The Compensation Committee ensures that executive officers of TierOne
Corporation who hold similar positions with TierOne Bank do not receive any compensation
for service as officers of TierOne Corporation. The Compensation Committee is governed by
its charter, which is available on our website, www.tieronebank.com.

The
Compensation Committee is comprised entirely of directors who meet the independence
requirements as defined by NASDAQ Rule 4200(a)(15), are deemed a non-employee
director under Rule 16b-3 of the Securities Exchange Act of 1934, as amended, and
satisfy the requirements of an outside director for purposes of Section
162(m)(4)(C) of the Internal Revenue Code. The Compensation Committee is comprised of the
following directors: Joyce Person Pocras (Chairperson); Ann Lindley Spence; Charles W. Hoskins; and
Campbell R. McConnell.

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The
objective of the Compensation Committee is to further the core compensation principles
described above through a compensation structure comprised of base salary and long-term
and short-term incentive-based compensation. Since a substantial part of total
compensation is incentive based, a direct link is established between executive
compensation and the long-term performance of TierOne Corporation and TierOne Bank.

The
Compensation Committee met three times during the year ended December 31, 2007. In
fulfilling its above described objectives, the Compensation Committee has historically
utilized outside consultants who have relied upon labor market studies and other relevant
market data. The Compensation Committee has the authority to directly engage these outside
consultants. The compensation survey information is drawn from both national and regional
financial research organizations that report compensation practices and salary levels for
executive positions at comparably sized financial institutions, specifically banks and
thrifts (referred to as our peer group). The Compensation Committees objective is to
provide competitive base salaries as well as the appropriate mix of long-term and
short-term incentive-based compensation that is comparable with total compensation paid by
TierOne Corporations peer group.

Our
Chief Executive Officer serves in an advisory role to the Compensation Committee with
respect to executive compensation for named executive officers other than himself,
including with respect to executive performance. The Chief Executive Officers
recommendations are considered by the Compensation Committee, but the Compensation
Committee remains responsible for all decisions on compensation levels for the named
executive officers and on our executive compensation policies and executive compensation
programs.

In
evaluating our top two executive officers, the Compensation Committee conducts an
evaluation of the Chief Executive Officers individual performance. The Chief Executive Officer
rates the Presidents individual performance and advises the Compensation Committee
of his assessment. Criteria that are considered in evaluating the individual performance of our two top executive
officers include integrity, vision, leadership, ability to meet corporate objectives,
succession planning, internal and external relations with customers, community and
employees and board relations. In December of 2006, the Compensation Committee completed
these evaluations for both the Chief Executive Officer and the President. These
evaluations were reflective of performance for the time period of calendar year 2006.

Executive
officers below the level of Chief Executive Officer and President receive a written
performance evaluation by the President which is subsequently reviewed and approved by the
Chief Executive Officer. These evaluations judge the individual officers performance
on a series of criteria which include technical and professional knowledge, leadership,
management skills, interpersonal skills and compliance with ethical standards and
reliability. These evaluations were completed in July of 2007 and were reflective of
performance for the time period of July 1, 2006 to June 30, 2007.

# Role of the
Compensation Consultant

From
time to time, the Compensation Committee has hired and engaged nationally recognized,
independent, third party compensation consultants to evaluate executive compensation, to
discuss general compensation trends, to provide competitive market data and to assist
human resources management in developing compensation recommendations to present to the
Compensation Committee. Generally on an annual basis, the compensation consultant provides
the Compensation Committee with advice, consultation and market information. Although the
compensation consultant provides market data for consideration by the Compensation
Committee in setting senior executive (including named executive officers) compensation
levels and programs, the compensation consultant does not make specific recommendations on
individual compensation amounts for named executive officers, nor does the consultant
determine the amount or form of executive compensation. All decisions on senior executive
compensation levels and programs are made by the Compensation Committee.

While
our Chief Executive Officer has the ability to meet with the compensation consultants on
an individual basis, this would only be done in situations where the Chief Executive
Officer believed there was a valid business reason, and the Compensation Committee would
be made aware of the meeting. Only the Compensation Committee has the authority to
continue or discontinue our relationship with a compensation consultant.

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# Total Compensation

The
Compensation Committee strives to compensate our named executive officers at competitive
levels, with an emphasis on the opportunity to earn above-market pay for above-market
performance as compared to our peer group through the incentive compensation portion of
our compensation program. To that end, total executive compensation is tied directly to
our performance and is structured to ensure equal focus on financial performance,
individual performance of our executive officers, and shareholder return. The Compensation
Committee engaged Crowe Chizek, an independent, third party compensation consultant, for a
total compensation review of the named executive officers for 2007. The compensation
consultants report was superseded by the execution of a proposed merger agreement
which dictated terms of the salaries of the named executive officers while it was in
effect. The Compensation Committee therefore approved the updating of existing salary
ranges by a cost of living factor and followed the terms of the agreement. The proposed
merger agreement was subsequently terminated in early 2008. We believe that the total
compensation paid in 2007 was reasonable in its totality and is consistent with our
compensation philosophies as described above.

To
the extent that base salaries and equity grants vary by professional role in the market
place, as demonstrated by the competitive market data supplied by our outside compensation
consultant, the base salaries and equity grants of the named executive officers will vary,
sometimes significantly. For example, consistent with the level of responsibility and the
executive compensation practices of the companies in the market data reviewed by the
Compensation Committee in the past, chief executive officers typically earned
significantly more in base salary and equity grants than other named executive officers.
This resulted in our Chief Executive Officer being eligible to receive a higher percentage
of base salary in annual and long-term incentives than our other named executive officers.

In
light of our compensation philosophy, we believe that the total compensation package for
our named executive officers should continue to consist of base salary, annual cash
incentive compensation, long-term equity-based incentive compensation, benefit plans and
certain other perquisites.

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# Elements of Compensation

Base Salary

Base
salaries for our executive officers are determined based on job responsibilities, level of
experience, individual performance and comparisons to the salaries of executives in
similar positions as compared to our peer group (and, in the case of executive officers
other than the Chief Executive Officer, the Compensation Committee also considers the job
performance evaluation and recommendation of the Chief Executive Officer before approving
a salary adjustment for the executive officers). To determine a competitive base salary,
the Compensation Committee reviews market data compiled by our outside national
professional consulting firm with respect to our peer group, supplemented by general
industry information, to assess the competitiveness of the base salary of the named
executive officers as well as other senior officers. The Chief Executive Officers
and Presidents base salaries are determined by using a weighting of 50% applied to
survey data and 50% to peer group data. The comparison used by the Compensation Committee
for these top two positions is to provide a base salary at the 75th percentile
of these results if merited by individual performance. Base salary levels for all other
executive officers are determined by measurement to the 50th percentile of
labor market industry survey data. Outside professional compensation consultant studies
are typically ordered by the Compensation Committee on an annual basis for the Chief
Executive Officer and President/Chief Operating Officer. Consultant studies are typically
completed for the other named executive and senior officers on a bi-annual basis. Various
outside consulting firms have been used by the Compensation Committee over a period of
years in order to maintain a full range of objective information.

Merit
pay adjustments to base salary are considered annually for each executive officer. When
making adjustments to the base salary of the Chief Executive Officer, the Compensation
Committee considers the job performance and contribution to the successful operation of
TierOne Corporation and TierOne Bank by the Chief Executive Officer. When making
adjustments to the base salaries of the other named executive officers, in addition to the
above, the Compensation Committee also considers the recommendation of the Chief Executive
Officer. Executive base salaries are intended to be at levels reasonably comparable to
those of our peer group with the opportunity for compensation at above market levels
resulting from the incentive compensation portion of the compensation program.

For
2007, Messrs. Lundstrom, Laphen, Witkowicz, Furnas and Ludemann received increases in the
range of 0.0% to 4.6% in their base salaries. The salary increases for the named executive
officers were reflective of their individual performance and our objectives regarding the
level of base salaries paid to our executives as described above. Base salaries paid to
Messrs. Lundstrom, Laphen, Witkowicz, Furnas and Ludemann represented 27.1%, 33.5%, 37.8%, 40.9% and 37.0%,
respectively, of their total compensation.

Annual Incentive
Compensation

We
maintain an annual incentive compensation program for participation by certain of our
employees, including each of the named executive officers. Eligibility for the annual
incentive program, referred to as the Management Incentive Compensation Plan, is
restricted to those individuals who, by way of their role in our Company, have significant
opportunity to improve our profits and growth. Consistent with our overall compensation
philosophy of linking incentive awards to company-wide and individual performance, the
annual incentive compensation program is designed to provide performance-based annual cash
compensation based on the achievement of annual performance targets approved by the
Compensation Committee. For 2007, five criteria were used to establish the performance
targets, including: diluted earnings per share (with options expensed) of TierOne
Corporation, nonperforming assets to total assets, return on average assets, net interest
margin and efficiency ratio of TierOne Bank. The performance measures are weighted as
follows: diluted earning per share (with options expensed) of TierOne Corporation: 60.0%;
nonperforming asset ratio: 10.0%; return on average assets: 10.0%; net interest margin:
10.0%; and efficiency ratio of TierOne Bank: 10.0%.

Other
than earnings per share and the nonperforming asset ratio, each of the remaining criteria
were measured against a peer group set forth in the plan consisting of eleven comparably
sized financial institutions. The plan sets forth the minimum, target and maximum levels
of organizational performance, measured against a percentage of the peer group average,
needed for payment of an incentive award based on Company or individual performance. For
earnings per share performance below the minimum level, no incentive award is made;
however, a discretionary award may still be granted.

8

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The
amount of the individual award for the Chief Executive Officer and President/Chief
Operating Officer is generally a function of the performance of TierOne Corporation and
TierOne Bank in relation to the organizational performance targets, as measured by the
criteria set forth above. The individual participants award for other executive and
senior officers also included the participants performance compared to a series of
individual goals. In addition to setting performance targets, the Compensation Committee
also sets each named executive officers target bonus percentage amount. This amount
is based on a percentage of each named executive officers base salary. In
determining the target bonus percentage amount, the Compensation Committee considered a
comprehensive compensation study conducted by our third party compensation consultant. The
study indicated we were below or at market levels in our cash incentive target levels for
the named executive officers. No action was taken by the Compensation Committee on these
study results due to the then-proposed merger agreement. In addition, the Compensation
Committee may also consider the impact an executive can have on meeting the stated
organizational performance targets.

Messrs.
          Lundstrom, Laphen, Witkowicz, Furnas and Ludemann had a target bonus percentage
          amount of 50%, 45%, 35%, 35% and 30%, respectively, of base salary for the 2007
          plan year. Due to the extensive commitment that each of the named executive
          officers made in working toward integrating TierOne Corporation into a
          third-party company under a proposed merger agreement which was ultimately
          terminated in early 2008, Messrs. Lundstrom, Laphen, Witkowicz, Furnas and
          Ludemann received primarily discretionary cash awards of $220,000, $130,000,
          $40,000, $40,000 and $35,883, respectively. Other than achievement of
individual           goals for bank deposit growth, no corporate performance-based
bonuses were           awarded to the named executive officers for 2007. These amounts
represent           bonuses earned under the Management Incentive Compensation Plan for
2007 that           were paid to the named executive officers in 2008. The annual
incentive           compensation paid to the named executive officers for 2007 comprised
9.7%, 10.4%, 8.1%, 7.7% and 7.6%, respectively, of total compensation.

Long-Term Incentives

In
the past, executive officers have been granted awards by the administrators of the 2003
Stock Option Plan and the 2003 Recognition and Retention Plan and Trust. Stock option
awards made to date have had an exercise price equal to the fair market value of a share
of stock on the grant date of the award. Stock option awards and restricted stock awards
vest pro rata over a five-year period at the rate of 20% per year. The year 2007
represented the fourth vesting period of these awards. No additional stock option or
restricted stock awards were granted to the named executive officers in 2007. For 2007,
the vested value of long-term incentive awards for Messrs. Lundstrom, Laphen, Witkowicz,
Furnas and Ludemann represented 55.9%, 50.7%, 45.2%, 42.8% and 47.6%, respectively, of
total compensation.

The
Compensation Committee believes that these type of long-term incentive awards help align
the interests of our executives with those of our shareholders through potential stock
ownership. Although there are no definitive plans for future awards to the named executive
officers, the Compensation Committee considers stock awards to be a key piece of executive
compensation and will continue to monitor industry trends and our peer groups equity
awards. We will react appropriately to maintain the competitiveness of our total
compensation program and ensure that the interests of our executives are aligned with
those of our shareholders.

Employment and Change in
Control Agreements

The
Company has entered into employment agreements with Messrs. Lundstrom and Laphen as well as
three-year change in control agreements with the remaining named executive officers. The
purpose of these agreements is to allow us to retain executives that significantly
contribute to our long-term success by providing those executives with certain benefits
upon the termination of their employment with us or upon a change in control, as
applicable. For more information on each of these agreements, see the discussion under the
heading Termination and Change in Control Provisions.

9

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Perquisites

In
2007, we provided a modest level of perquisites to certain executive and senior officers.
Perquisites are given to executive and senior officers based upon their role in the
company and the business advantage gained by the use of perquisites. In 2007, we provided
the following perquisites to the named executive officers:

| |  | Messrs.
Lundstrom, Laphen, Furnas and Ludemann were provided memberships to various country clubs
located in Lincoln and Omaha, Nebraska. The cost to us of these memberships was $4,600,
$4,140, $3,480 and $4,600, respectively.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Mr.
Lundstrom received a cash allowance of $12,000 as compensation for automobile usage.
| | - | ----------------------------------------------------------------------------------------

# Retirement Benefits

In
addition to the above, we maintain the following plans that provide, or may provide,
compensation to the named executive officers. Our Compensation Committee considers all of
these plans and benefits when reviewing total compensation for our executive officers.

Retirement Plans

Through
2003, we maintained the TierOne Bank Retirement Plan, a defined benefit plan which
generally provided for a monthly benefit upon a participants retirement. This plan
was available to all of our employees and was offered to the named executive officers
under the same terms and conditions as all other employees. Effective December 31, 2002,
there was a plan curtailment resulting in a freeze of future accrual of benefits under the
plan. Effective January 1, 2004, we merged our defined benefit plan with an unrelated
multiple employer retirement plan. All participants are fully vested in their benefits
under the retirement plan. The participants benefits under the multiple employer
retirement plan are identical to those under our former plan. This retirement plan is
described in detail in the discussion under the heading Pension Benefits.

In
addition, we currently maintain a separate supplemental executive retirement plan for Mr.
Lundstrom, which provides an annual benefit to Mr. Lundstrom during the 15 years following
his retirement. The supplemental executive retirement plan is described in detail in the
discussion under the heading Pension Benefits.

Employee Stock Ownership
Plan

We
have established an employee stock ownership plan (ESOP) for the benefit of
our employees. Our employees, other than those paid solely on a retainer or fee basis, who
have been credited with at least 1,000 hours of service during a 12-month period are
eligible to participate in the ESOP. The named executive officers participate in the ESOP
on the same terms and conditions as all other employees. Upon formation, the ESOP
purchased 1,806,006 shares of common stock with the proceeds of a loan from the Company. These
shares are held in a suspense account and are released to participants on a pro rata basis
as debt service payments are made on the loan. Compensation for purposes of the ESOP
excludes bonuses and other special compensation in excess of $6,000. Dividend payments
were used as a portion of the debt service on the loan in 2007. The shares released from
the suspense account as a result of dividend payments on previously awarded shares are
allocated to each participants ESOP account based on the ratio of each such
participants account balance to all participants account balances. All other
shares released from the suspense account as a result of dividend payments or other debt
service payments are allocated based on the ratio of each such participants eligible
compensation to the total eligible compensation of all ESOP participants.

401(k) Plan

We
sponsor a defined contribution 401(k) profit sharing plan. Employees, other than employees
paid solely on a retainer or fee basis, become eligible to participate in the 401(k) plan
upon the completion of six months of service. The named executive officers participate in
the 401(k) profit sharing plan on the same terms and conditions as all other employees.
Under the 401(k) plan, we make matching contributions to the 401(k) plan equal to 50% of
the first 6% of compensation deferred by a participant. Compensation for purposes of the
401(k) plan excludes bonuses and other special compensation in excess of $6,000. Our Board
of Directors periodically reviews the level of matching contributions under the 401(k)
plan and has the discretion to change the amount of the match from time to time.

10

---

Non-Qualified Deferred
Compensation

We
maintain a deferred compensation plan. The plan generally allows a select group of
management (including certain of the named executive officers), highly compensated
employees and members of our Board of Directors and the Board of Directors of TierOne Bank
to defer certain elements of compensation until a date determined in accordance with the
plan or pursuant to an election by the participant. This plan represents only a promise on
our part to pay amounts in the future and is subject to the claims of our creditors. For
more information on the deferred compensation plan, see the discussion under the heading
Non-Qualified Deferred Compensation. We also maintain a supplemental executive
retirement plan to provide supplemental benefits to those executives whose benefits under
the ESOP and the 401(k) profit sharing plan are reduced by limitations imposed by the
Internal Revenue Code. The purpose of the plan is to extend full retirement benefits to
participants without regard to statutory limitations under tax-qualified plans.
Supplemental benefits awarded under the plan equal the amount of additional benefits the
participants would receive if there were no income limitations imposed by the Internal
Revenue Code. From time to time, our Board of Directors may designate those employees
eligible for participation in this plan. For more information on these plans, see the
discussion under the heading Non-Qualified Deferred Compensation.

# Tax Deductibility of Pay

Section
162(m) of the Internal Revenue Code places a limit of $1,000,000 on the amount of
compensation that we may deduct in any one year with respect to each of our five most
highly paid executive officers. There is an exception to the $1,000,000 limitation for
performance-based compensation meeting certain requirements. Annual cash incentive
compensation and equity awards generally are performance-based compensation meeting those
requirements and, as such, are fully deductible. To maintain flexibility in compensating
executive officers in a manner designed to promote varying corporate goals, the
Compensation Committee has not adopted a policy requiring all compensation to be
deductible.

# Summary Compensation
Table

The
following table sets forth for each of the named executive officers: (1) the dollar value
of base salary and bonus earned during the past two fiscal years; (2) the dollar value of
the compensation cost of all stock and option awards recognized over the requisite service
period, computed in accordance with Statement of Financial Accounting Standards No. 123 (Revised 2004)
(SFAS 123(R)); (3) the dollar value of earnings for services pursuant to awards granted
during those years under non-equity incentive plans; (4) the change in pension value and
non-qualified deferred compensation earnings during those years; (5) all other
compensation for those years; and (6) the dollar value of total compensation for those
years. The named executive officers are our principal executive officer, principal
financial officer, and each of our three other most highly compensated executive officers
as of December 31, 2007 (each of whose total cash compensation exceeded $100,000 for
fiscal year 2007).

11

---

|                            
|----------------------------
|
|Name and
Principal Position:
|Gilbert G. Lundstrom,       
|Chairman of the Board       
|and Chief Executive         
|Officer                     
|                            
|James A. Laphen,            
|President and Chief         
|Operating Officer           
|                            
|Eugene B. Witkowicz,        
|Executive Vice              
|President, Chief            
|Financial Officer,          
|Corporate                   
|Secretary/Treasurer and     
|Director of Finance         
|                            
|Gale R. Furnas,             
|Executive Vice              
|President and Director      
|of Lending                  
|                            
|Roger R. Ludemann,          
|Executive Vice              
|President and Director      
|of Retail Banking           
|                            

---

|(1) | Includes
with respect to Messrs. Lundstrom and Laphen directors fees                totaling
$42,500 each in 2007.
|--- | -------------------------------------------------------------------------------------------------------------------

|(2) | These
amounts reflect the dollar value of the compensation cost of all
               outstanding stock awards or option awards recognized over the requisite
service                period, computed in accordance with SFAS 123(R). The assumptions
made in valuing                the stock awards are included under the caption Stock
Based Benefit                Plans in Note 18 of Notes to Consolidated Financial
Statements in this                Annual Report on Form 10-K, as amended,.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Represents cash
incentives earned under the Management Incentive                Compensation Plan for
2007 that were paid in 2008.
|--- | ----------------------------------------------------------------------------------------------------------------------------------

|(4) | For Messrs. Lundstrom and Laphen in 2007, reflects
their aggregate increase of $146,210 and $800,
respectively, in the actuarial present value of their accumulated benefit under our defined benefit pension plan
and supplemental retirement plan, less their earnings of $(90,969) and $(37,506), respectively, in the supplemental
executive retirement plan for the ESOP and their earnings of $(4,705) and $3,463, respectively in the supplemental
executive retirement plan for the 401(k) plan. For the
other named executive officers in 2007, reflects the aggregate increase in the actuarial present value of their accumulated benefit
under our defined benefit pension plan. For 2006, reflects Messrs. Lundstroms and Laphens aggregate positive earnings in the
supplemental executive retirement plan for the ESOP and the supplemental retirement plan for the 401(k) plan.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(5) | All
Other Compensation includes the following items:
|--- | ------------------------------------------------------

| | a. | Car
allowance for Mr. Lundstrom of $12,000.
| | -- | -------------------------------------------

| | b. | 401(k)
matching contribution for Messrs. Lundstrom, Laphen, Witkowicz, Furnas           and
Ludemann of $6,750, $6,750, $5,795, $6,596 and $5,398, respectively.
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------

| | c. | Club
dues for Messrs. Lundstrom, Laphen, Furnas and Ludemann of $4,600, $4,140,
          $3,480 and $4,600, respectively.
| | -- | --------------------------------------------------------------------------------------------------------------------------

| | d. | Net
ESOP allocation to Messrs. Lundstrom, Laphen, Witkowicz, Furnas and Ludemann           of
$26,613, $26,613, $22,834, $25,859 and  $21,250, respectively.
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------

| | e. | Dividend
payment on nonvested restricted stock awards to Messrs. Lundstrom,                Laphen,
Witkowicz, Furnas and Ludemann of $16,720, $8,360, $3,040, $3,040 and
               $3,040, respectively.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | f. | Supplemental
Executive Retirement Plan (SERP) for ESOP and 401(k) contributions                for
Messrs. Lundstrom and Laphen of $51,318 and $22,505, respectively.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Grants of Plan Based
Awards in 2007

We
strive to compensate our named executive officers at competitive levels, with an emphasis
on the opportunity to earn above-market pay for above-market performance as compared to
our peer group through the incentive compensation portion of our compensation program. We
believe that the total compensation paid in 2007 was reasonable in its totality and is
consistent with our compensation philosophies as previously described.

The
following table sets forth information regarding equity and non-equity awards granted to
the named executive officers in 2007. As shown in the table, during 2007, no stock options
or restricted stock awards were made to the named executive officers. The table below also
highlights the estimated future payouts under the Management Incentive Compensation Plan
at the time the awards were granted under the plan. As of the date of this Amendment No. 1
to the Annual Report on Form 10-K/A, these non-equity incentive plan awards have been
earned and paid out, as discussed in more detail in the Compensation Discussion and
Analysis.

12

---

|                                                               
|---------------------------------------------------------------
|
|Estimated Future Payouts Under
Non-Equity Incentive Plan Awards
|Name                                                           
|Gilbert G. Lundstrom                                           
|                                                               
|James A. Laphen                                                
|                                                               
|Eugene B. Witkowicz                                            
|                                                               
|Gale R. Furnas                                                 
|                                                               
|Roger R. Ludemann                                              
|                                                               

As
previously described in Elements of Compensation, we maintain an annual incentive
compensation program for participation by certain of our employees, including each of the
named executive officers. Messrs. Lundstrom, Laphen, Witkowicz, Furnas and Ludemann had a
target bonus percentage amount of 50%, 45%, 35%, 35% and 30%, respectively, of base salary
for the 2007 plan year. Due to the extensive commitment each of the named executive
officers made in working toward integrating TierOne Corporation into a third-party company
under a proposed merger agreement which was ultimately terminated in early 2008, Messrs.
Lundstrom, Laphen, Witkowicz, Furnas and Ludemann received primarily discretionary cash
awards of $220,000, $130,000, $40,000, $40,000 and $35,883, respectively. These amounts
represent bonuses earned under the Management Incentive Compensation Plan for 2007 that
were paid in 2008.

In
the past, executive officers have been granted awards in the form of restricted stock or
stock options pursuant to the 2003 Stock Option Plan and the 2003 Recognition and
Retention Plan and Trust. Stock option awards made to date have had an exercise price
equal to the fair market value of a share of stock on the date of the award. Stock option
awards and restricted stock awards vest pro rata over a five-year period at the rate of
20% per year. The year 2007 represented the fourth vesting period of these awards. No
additional stock option or restricted stock awards were made to the named executive
officers in 2007.

# Outstanding Equity
Awards at Year End

The
following table sets forth information on outstanding option and stock awards held by the
named executive officers at December 31, 2007, including the number of shares underlying
both exercisable and unexercisable portions of each stock option, as well as the exercise
price and expiration date of each outstanding option.

|                    
|--------------------
|
|
|Name                
|Gilbert G. Lundstrom
|                    
|James A. Laphen     
|                    
|Eugene B. Witkowicz 
|                    
|Gale R. Furnas      
|                    
|Roger R. Ludemann   
|                    

---

|(1) | All
of the stock option awards and stock awards were granted April 23,                2003
and vest pro rata over a five year period at the rate of 20% per year. The
               year 2007 represented the fourth vesting period of these awards.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

13

---

# Option Exercises and
Stock Vested

The
following table sets forth information regarding each exercise of stock options and
vesting of restricted stock that occurred during 2007 for each of our named executive
officers on an aggregated basis.

|                    
|--------------------
|
|
|Name                
|Gilbert G. Lundstrom
|                    
|James A. Laphen     
|                    
|Eugene B. Witkowicz 
|                    
|Gale R. Furnas      
|                    
|Roger R. Ludemann   
|                    

# Pension Benefits

The
following table sets forth the actuarial present value of each named executive
officers accumulated benefit under each defined benefit plan, assuming benefits are
paid at normal retirement age based on current levels of compensation. The valuation
method and all material assumptions applied in quantifying the present value of the
current accumulated benefit for each of the named executive officers are included under
the caption Employee Benefit Plans in Note 17 of Notes to Consolidated
Financial Statements in this Annual Report on Form 10-K, as amended. The table also shows
the number of years of credited service under each such plan, computed as of the same
pension plan measurement date used in our audited financial statements for the year ended
December 31, 2007. The table also reports any pension benefits paid to each named
executive officer during the year.

|                    
|--------------------
|
|Name                
|Gilbert G. Lundstrom
|                    
|                    
|                    
|James A. Laphen     
|                    
|Eugene B. Witkowicz 
|                    
|Gale R. Furnas      
|                    
|Roger R. Ludemann   
|                    

---

|(1) | Supplemental
Retirement Plan payments are reduced by the Pension Plan or any           disability
insurance benefits.
|--- | ---------------------------------------------------------------------------------------------------------------------

# Retirement Plan

Through
2003, we maintained the TierOne Bank Retirement Plan, a defined benefit plan intended to
satisfy the tax-qualification requirements of Section 401(a) of the Internal Revenue Code.
Employees, other than employees paid solely on a retainer or fee basis, became eligible to
participate in the retirement plan upon the attainment of age 21 and the completion of one
year of eligibility service. Effective December 31, 2002, there was a plan curtailment
resulting in a freeze of future accrual of benefits under the plan. Effective January 1,
2004, we merged our defined benefit plan with an unrelated multiple employer retirement
plan.

14

---

The
retirement plan provided for a monthly benefit upon a participants retirement at the
age of 65, or if later, adjusted accordingly to reflect the actual retirement date. A
participant may also receive a benefit on his early retirement date, which is the date on
which he attains age 60 and completes ten years of vesting service. Benefits received
prior to a participants normal retirement date are reduced by certain factors set
forth in the retirement plan. All participants are now fully vested in their benefits
under the retirement plan. The participants benefits under the new multiple employer
retirement plan are identical to those under our former plan.

In
general, the benefit formula was 1% of the five highest years of base salary (determined
as of December 31, 2002) for each year of service (determined as of December 31, 2002).
The frozen annual benefits of the named executive officers are as follows, as if they
commenced at normal retirement age in the normal form of payment of a ten-year certain and
life annuity: Mr. Lundstrom, $16,000; Mr. Laphen, $2,500; Mr. Witkowicz $41,155; Mr.
Furnas $28,621; and Mr. Ludemann $8,916. The benefits are not subject to reduction for
Social Security benefits or other offset. Under the terms of the retirement plan, Mr.
Lundstrom was eligible for retirement benefits at December 31, 2007.

# Supplemental Executive
Retirement Plan

We
currently maintain a supplemental executive retirement plan for Mr. Lundstrom. The plan
originated in 1993 in consideration of his remaining in our employ until age 65. As Mr.
Lundstrom has attained age 65, he was eligible to receive a supplemental benefit for a
period of 15 years if he had retired on December 31, 2007. Mr. Lundstroms annual
supplemental benefit will equal his average annual compensation (excluding bonuses and
incentive compensation) during the three years of employment affording the highest average
compensation, reduced by amounts paid under the retirement plan or any disability benefits
paid by us, multiplied by 50%. Assuming that Mr. Lundstrom had retired on December 31,
2007 with average annual compensation calculated based on his last three years of
compensation, he would be entitled to an annual benefit of $267,473 for 15 years under the
supplemental executive retirement plan. If Mr. Lundstrom dies after he retires but before
the supplemental benefits are paid for 15 years, the remaining supplemental benefits will
be paid to his beneficiary or estate. In the event he dies before retirement, supplemental
benefit payments for a 15-year period will be paid to his beneficiary or estate. In the
event of the disability of Mr. Lundstrom while in the employ of the Bank, the Bank shall
pay an annual benefit for up to ten years, payable in equal monthly installments
commencing with the first day of the month following the lapse of six months after the
date he is replaced, or until the discontinuance of the disability and employment is fully
restored to Mr. Lundstrom. The supplemental executive retirement plan requires Mr.
Lundstrom to continue his services with us and not to compete with us in order to receive
the benefits thereunder. The unfunded plan represents only a promise on our part to pay
the benefits thereunder and is subject to the claims of our creditors.

# Non-Qualified Deferred
Compensation

The
following table sets forth annual executive and Company contributions under non-qualified
defined contribution and other deferred compensation plans, as well each named executive
officers withdrawals, earnings and fiscal-year end balances in those plans.

15

---

|                                
|--------------------------------
|
|Name                            
|Gilbert G. Lundstrom            
|SERP for ESOP(1)                
|SERP for 401(k)(1)              
|Deferred Director Comp. Plan    
|Deferred Restricted Stock Awards
|                                
|James A. Laphen                 
|SERP for ESOP(1)                
|SERP for 401(k)(1)              
|Deferred Director Comp. Plan    
|Deferred Restricted Stock Awards
|                                
|Eugene B. Witkowicz             
|Deferred Restricted Stock Awards
|                                
|Gale R. Furnas                  
|Deferred Restricted Stock Awards
|                                
|Roger R. Ludemann               
|Deferred Restricted Stock Awards
|                                

|(1) | The
registrant contributions to the SERP for ESOP and 401(k) are included in the
               Summary Compensation Table under All Other Compensation. The
               aggregate earnings from the SERP for ESOP and 401(k) are included in the
               Change in Pension and Nonqualified Deferred Compensation Earnings of
               the Summary Compensation Table.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Represents
the aggregate increase (decrease) in market value earnings for selected non-qualified
deferred compensation plans.
|--- | -----------------------------------------------------------------------------------------------------------------------------

# Deferred Compensation
Plan

We
currently maintain a deferred compensation plan for a select group of management, highly
compensated employees and members of our Board of Directors or the Board of Directors of
TierOne Bank. Among those who participate in the plan are Messrs. Lundstrom and Laphen and
the non-employee directors identified in the Director Compensation section
below.

Under
the plan, participants may defer amounts of base salary, incentive compensation (including
that which qualifies as performance-based compensation under Section 409A of the Internal
Revenue Code), or director fees, as applicable. Employees who participate may also receive
phantom employer contributions that would otherwise have been made to the
participants ESOP or 401(k) account if they had not deferred eligible compensation
as defined by those plans. Until 2006, restricted stock awards were also eligible for
deferral. Participants non-equity deferred compensation accounts are maintained
under a Company Owned Life Insurance (COLI) administrative agreement.
Restricted stock awards that were deferred prior to 2006 are maintained under a Rabbi
Trust. However, these arrangements represent only promises on our part to pay amounts in
the future and are subject to the claims of our general creditors.

Messrs.
          Lundstrom, Laphen, Witkowicz, Furnas and Ludemann as well as non-employee
          directors have participated in deferring restricted stock awards in the past.
          The number of shares deferred by Messrs. Lundstrom, Laphen, Witkowicz, Furnas
          and Ludemann are 24,000, 2,000, 16,000, 16,000 and 16,000, respectively.

Payments
commence under the plan upon the earlier of separation of service, as defined
in Section 409A of the Internal Revenue Code, death, disability, change in
control, or in-service distribution as specified in the participants deferral
election form. Participants are also allowed to make a withdrawal from their deferred
compensation account upon the happening of an unforeseeable emergency. An
unforeseeable emergency is defined as a severe financial hardship to the
participant resulting from (1) an illness or accident of the participant, the
participants spouse, or a dependent of the participant (within the meaning of
Section 152(a) of the Code), (2) loss of the participants property due to casualty,
or (3) other extraordinary and unforeseeable circumstances arising as a result of events
beyond the control of the participant. Payment in the event of an unforeseeable emergency
may not be made in the event that such hardship is or may be relieved through
reimbursement or compensation by insurance or otherwise; by liquidation of the
participants assets, to the extent that liquidation of such assets would not itself
cause severe financial hardship; or by cessation of deferrals under the plan. Participants
other than directors may elect to receive benefits in the form of a single lump sum
payment or monthly installments paid over a period not to exceed 120 months. A participant
who is a director may elect to receive payment in the following forms: (i) a lump sum
payment, (ii) a life annuity, (iii) a joint survivor annuity, or (iv) a monthly payment of
a fixed amount over a period of 240 months. If a participant fails to elect a form of
payment, the deferred compensation will be paid to him/her in monthly cash payments over a
period of 120 months if the participant is not a director and over 240 months if the
participant is a director.

16

---

Under
the plan, change in control means a change in the ownership of TierOne Bank or
TierOne Corporation, a change in the effective control of TierOne Bank or TierOne
Corporation or a change in the ownership of a substantial portion of the assets of TierOne
Bank or TierOne Corporation as provided under Section 409A of the Internal Revenue
Code and the regulations thereunder.

# Supplemental Executive
Retirement Plans for ESOP and 401(k)

We
have also implemented two supplemental executive retirement plans to provide supplemental
benefits to certain employees (initially, Messrs. Lundstrom and Laphen) whose benefits
under the ESOP and the 401(k) profit sharing plan are reduced by limitations imposed by
the Internal Revenue Code. The supplemental benefits equal the amount of additional
benefits the participants would receive if there were no income limitations imposed by the
Internal Revenue Code. Amounts credited under the supplemental plans are treated as if
they were invested in the ESOP or 401(k) account of the participant. The vested portion of
a participants account under the supplemental plan is determined on the basis of the
participants number of years of service. Participants with less than five years of
service have a 0% vesting percentage and participants with five or more years of service
are 100% vested in the supplemental benefits. Notwithstanding the above vesting schedule,
participants are 100% vested upon the attainment of age 65, becoming disabled or the
occurrence of a change in control. The vested portion of amounts credited to a
participants account may not be distributed prior to the earlier of (i) the
participants disability or death, (ii) the first day of the month following the
lapse of six months after the participants separation from service for reasons other
than disability or death, (iii) the specific post-retirement date set forth in the
participants payment election form, or (iv) a change in control. The vested portion
of amounts credited to a participants account shall be distributed to a participant
at the time and in the manner indicated on the participants payment election.
Payment options available to participants include installments up to a ten-year period or
a single lump sum. From time to time, our Board of Directors will designate which
employees may participate in these additional supplemental executive retirement plans.

Under
the supplemental plans, a change in control means a change in the ownership of
TierOne Bank or TierOne Corporation, a change in the effective control of TierOne Bank or
TierOne Corporation or a change in the ownership of a substantial portion of the assets of
TierOne Bank or TierOne Corporation as provided under Section 409A of the Internal
Revenue Code and the regulations thereunder.

The
supplemental executive retirement plans for the ESOP and the 401(k) are maintained under a
Rabbi Trust; however, this trust represents only promises on our part to pay amounts in
the future and are subject to the claims of our general creditors.

# Potential Payments Upon
Termination or Change in Control

The
Company has entered into employment and change in control agreements with certain of the named
executive officers. The following tables describe the potential payments upon termination
or a change in control, including payments under any applicable employment agreement or
change in control agreements. These tables assume the named executive officers
employment was terminated on December 31, 2007, the last business day of our fiscal year,
and the price per share was $22.15, the closing price of our common stock on December 31,
2007, the last trading day of the year. Descriptions of the circumstances that would
trigger payments or the provision of benefits to the named executive officers, how such
payments and benefits are determined under the circumstances, material conditions and
obligations applicable to the receipt of payments or benefits and other material factors
regarding such agreements and plans, as well as other material assumptions that we have
made in calculating the estimated compensation, follow the tables.

17

---

|                                                                                   
|-----------------------------------------------------------------------------------
|
|Termination
by the
Company for
Cause or by
the
Executive
for other
than Good
Reason
|                                                                                   
|Base Salary                                                                        
|Incentives                                                                         
|Stock Options (Strike Price = $17.83) - Accelerated                                
|Restricted Stock Unvested - Accelerated                                            
|Change of Control Payment                                                          
|Pension and Benefit Enhancements                                                   
|Insurance Benefits                                                                 
|Tax Gross-Up                                                                       
|                                                                                   
|Total                                                                              
|                                                                                   
|James A. Laphen (2)                                                                
|                                                                                   
|Base Salary                                                                        
|Incentives                                                                         
|Severance                                                                          
|Stock Options (Strike Price = $17.83) - Accelerated                                
|Restricted Stock Unvested - Accelerated                                            
|Pension and Benefit Enhancements                                                   
|Insurance Benefits                                                                 
|Tax Gross-Up                                                                       
|                                                                                   
|Total                                                                              
|                                                                                   

|(1) | The
amounts in this table do not include the cash incentives earned under the
               Management Incentive Compensation Plan for 2007 that were paid in 2008,
which                are set forth in the Summary Compensation Table, or the non-enhanced
payments                and benefits to which the named executive officer would be
entitled under our                retirement plans and non-qualified deferred
compensation plans, as set forth                under Pension Benefits and
Non-Qualified Deferred                Compensation above.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Under
the agreement, the Company shall indemnify, hold harmless and defend
               Messrs. Lundstrom and Laphen against reasonable costs, including legal
fees and                expenses, incurred in connection with or arising out of any
action, suit or                proceeding to defend or enforce the terms of this
agreement. The value or cost                to enforce this clause in the agreement is
not included in the above table as                the amount is of a nature that is
undeterminable at this time.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

18

---

|                                                                                   
|-----------------------------------------------------------------------------------
|
|Termination by
the Company for
Cause or by the
Executive for
other than Good
Reason
|Base Compensation                                                                  
|Unvested Stock Options                                                             
|Restricted Stock                                                                   
|401(k) Matching                                                                    
|Insurance Benefits                                                                 
|Section 280G Limit                                                                 
|                                                                                   
|Total                                                                              
|                                                                                   
|Gale. R. Furnas                                                                    
|                                                                                   
|Base Compensation                                                                  
|Unvested Stock Options                                                             
|Restricted Stock                                                                   
|401(k) Matching                                                                    
|Insurance Benefits                                                                 
|Section 280G Limit                                                                 
|                                                                                   
|Total                                                                              
|                                                                                   
|Roger R. Ludemann                                                                  
|                                                                                   
|Base Compensation                                                                  
|Unvested Stock Options                                                             
|Restricted Stock                                                                   
|401(k) Matching                                                                    
|Insurance Benefits                                                                 
|Section 280G Limit                                                                 
|                                                                                   
|Total                                                                              
|                                                                                   

|(1) | The
amounts in this table do not include the cash incentives earned under the
               Management Incentive Compensation Plan for 2007 that were paid in 2008,
which                are set forth in the Summary Compensation Table, or the non-enhanced
payments                and benefits to which the named executive officer would be
entitled under our                retirement plans and non-qualified deferred
compensation plans, as set forth                under Pension Benefits and
Non-Qualified Deferred                Compensation above.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Employment Agreements

TierOne Banks
Agreement with Mr. Lundstrom

TierOne
Bank has entered into an employment agreement with Mr. Lundstrom which is extended on an
annual basis, unless and until either the Board of Directors or Mr. Lundstrom gives
written notice of non-renewal. TierOne Banks Board of Directors may terminate Mr.
Lundstroms employment agreement at any time, but any termination, other than
termination for cause will not prejudice Mr. Lundstroms right to
compensation or other benefits under his agreement.

In
the event of termination for cause, Mr. Lundstrom has no right to receive compensation or
other benefits, for any period after termination with the exception of vested benefits
under TierOne Banks benefit plans or policies and incentive plans for the benefit of
the executive. In the event TierOne Bank chooses to terminate Mr. Lundstroms
employment for reasons other than for cause, or in the event Mr. Lundstrom resigns for
good reason, Mr. Lundstrom or, in the event of his death, his beneficiary or
estate, are entitled to receive a lump sum cash payment equal to Mr. Lundstroms
base amount of compensation, as defined under Section 280G(b)(3) of the
Internal Revenue Code, times the number of years or fractional portion thereof remaining
in the term of the agreement as of the termination date provided that such payments and
benefits do not constitute an excess parachute payment under Section 280G of the Internal
Revenue Code.

TierOne
Bank may terminate Mr. Lundstroms employment for cause under the
agreement if he (i) willfully fails to perform his duties under the agreement, other than
any such failure resulting from his incapacity due to physical or mental illness; (ii)
commits an act involving moral turpitude in the course of his employment; (iii) commits
any act of personal dishonesty; (iv) demonstrates incompetence; (v) engages in willful
misconduct; (vi) breaches his fiduciary duties for personal profit; (vii) willfully
violates any law, rule, or regulation or final cease-and-desist order; or (viii)
materially breaches the provisions of the agreement.

19

---

Mr.
          Lundstrom may terminate his employment with TierOne Bank for good
          reason upon (i) a change in control of TierOne Bank occurring not more
          than twelve months prior to the termination, (ii) any assignment to Mr.
          Lundstrom of any duties significantly different than those contemplated by the
          agreement, (iii) any limitation of the powers of Mr. Lundstrom not contemplated
          by the agreement, (iv) any removal of Mr. Lundstrom from or any failure to
          reelect him to any of the positions indicated in the agreement, or (v) a
          reduction in Mr. Lundstroms base salary, or a material reduction in his
          fringe benefits.

Change
in control means a change in the ownership of TierOne Bank or TierOne Corporation, a
change in the effective control of TierOne Bank or TierOne Corporation or a change in the
ownership of a substantial portion of the assets of TierOne Bank or TierOne Corporation as
provided under Section 409A of the Internal Revenue Code and the regulations
thereunder.

TierOne Banks
Agreement with Mr. Laphen

TierOne
Bank has entered into an employment agreement with Mr. Laphen which is extended on an
annual basis, unless and until either the Board or Mr. Laphen gives written notice of
non-renewal. TierOne Banks Board of Directors or Mr. Laphen may terminate Mr.
Laphens employment agreement at any time, upon the occurrence of an event of
termination. If Mr. Laphen is terminated for cause, Mr. Laphen has no
right to receive compensation or other benefits for any period after termination with the
exception of vested benefits under TierOne Banks benefit plans or policies and
incentive plans for the benefit of the executive. In the event of termination due to death
or disability, Mr. Laphen, or his beneficiary or estate, are entitled to receive a payment
equal to twelve months base salary. In the event Mr. Laphens employment is
terminated for reasons other than for cause, death, disability or retirement (referred to
as an event of termination), Mr. Laphen or, in the event of his subsequent death, his
beneficiary or estate, is entitled to receive an amount equal to thirty-six months base
salary provided that the payments do not exceed three times his average annual
compensation for the preceding five years he was employed by TierOne Bank.

Under
the agreement, an event of termination includes any of the following: (i) the
termination of Mr. Laphens full-time employment for any reason other than a
termination upon a change in control, a termination for death, disability or retirement,
or termination for cause; and (ii) Mr. Laphens resignation upon any: (a) failure to
elect or reelect or to appoint or reappoint Mr. Laphen as President and Chief Operating
Officer; (b) a material demotion in Mr. Laphens function, duties, or
responsibilities; (c) a relocation of Mr. Laphens principal place of employment by
more than 60 miles from its location at the effective date of the agreement; (d) a
material reduction in the benefits and perquisites to Mr. Laphen or (e) breach of the
agreement by TierOne Bank.

A
termination for cause means a termination because of Mr. Laphens
personal dishonesty, incompetence, willful misconduct, any breach of fiduciary duty
involving personal profit, intentional failure to perform on stated duties, willful
violation of any law, rule or regulation or final cease-and-desist order or material
breach of any provision of the agreement.

Mr.
          Laphens employment agreement also provides that if, at any time during
the           term of the agreement, following the occurrence of a change in
          control, Mr. Laphen is (i) dismissed, or (ii) voluntarily resigns from
his           employment following any demotion, loss of title, office or significant
          authority or responsibility, material reduction in annual compensation or
          benefits or relocation of his principal place of employment by more than 60
          miles from its location immediately prior to the change in control, TierOne
Bank           will pay to him an amount equal to the greater of the payments due for the
          remainder of the agreement, or three times his base salary. In no event will
any           payment made to Mr. Laphen in connection with a change in control exceed
three           times his average annual compensation. Amounts payable upon a change in
control           will be reduced to the extent necessary to prevent such amounts from
          constituting an excess parachute payment under Section 280G of the
          Internal Revenue Code.

Change
in control means a change in the ownership of TierOne Bank or TierOne Corporation, a
change in the effective control of TierOne Bank or TierOne Corporation or a change in the
ownership of a substantial portion of the assets of TierOne Bank or TierOne Corporation as
provided under Section 409A of the Internal Revenue Code and the regulations
thereunder.

20

---

Under
his employment agreement, Mr. Laphen is prohibited from competing with, and disclosing the
confidential information of, TierOne Bank for a period of one year following an event of
termination.

TierOne
Corporations Agreement with Mr. Lundstrom

TierOne
Corporations employment agreement with Mr. Lundstrom, as amended, has a term of
three years, beginning on July 27, 2006 and extending daily thereafter unless and until
either the Company or Mr. Lundstrom give notice that the daily extensions will cease. Extension of
the term also will cease automatically if Mr. Lundstroms employment is terminated
for any reason. Under the terms of the employment agreement with TierOne Corporation, to
the extent that any of the payments and benefits provided by the agreement are paid to or
received by Mr. Lundstrom under his employment agreement with TierOne Bank, such
payments and benefits provided by TierOne Bank are subtracted from any amounts due him
under similar provisions of the employment agreement with TierOne Corporation (including
without limitation, the payments described below).

In
the event that, during the term of his employment agreement, Mr. Lundstroms
employment is terminated by the Company without cause for other than death or disability, or if
Mr. Lundstrom resigns for any of the reasons specified below, he will be entitled to
receive as liquidated damages (i) all earned but unpaid base salary and benefits to which
he is entitled through the date of the termination of his employment, (ii) continued group
life, health and disability benefits with coverage equivalent to the coverage he would
have been entitled to if he had continued to be employed for the remainder of the
employment period at the highest rate of salary achieved during the period of his
employment; provided, however, that he will receive a cash payment in lieu of, and equal
to, the value of such benefits if such benefits would trigger the 20% tax and interest
penalties under Section 409A of the Internal Revenue Code, (iii) a cash lump sum payment
in an amount equal to the present value of the salary he would have received if his
employment had continued to the expiration of the term of his employment agreement at the
highest annual rate of base salary achieved during the term of his employment, and (iv) a
lump sum equal to cash bonus and incentive compensation and qualified and non-qualified
retirement plan benefits (on a present value basis) for the period of the remaining term
of his employment agreement, but not more than three years. To the extent that Mr.
Lundstrom earns salary, cash bonus or incentive compensation, fees or comparable fringe
benefits from another employer during this period, the liquidated damages for loss of this
type of compensation will be subject to repayment by Mr. Lundstrom. In addition, if
Mr. Lundstrom surrenders his then outstanding options and shares of restricted stock
within 30 days of the termination of his employment, we will pay him the value of his
outstanding options and his shares of restricted stock.

The
reasons specified in Mr. Lundstroms employment agreement that would justify his
resignation and receipt of the liquidated damages described above are a material breach of
the agreement by the Company (including a reduction in his salary or a material reduction in his
fringe benefits), a failure to elect him to the positions in which he has a right to serve
under his employment agreement, a failure to vest in him the authority and
responsibilities associated with those positions, a failure to nominate or elect him as a
director of TierOne Corporation or TierOne Bank, a change in his principal place of
employment to a location more than 25 miles from our corporate headquarters in Lincoln,
Nebraska, a termination by him of his employment with TierOne Bank for good reason or a
termination of his employment by TierOne Bank for other than cause, regulatory action,
death or disability. The term good reason has the meaning ascribed to it in
Mr. Lundstroms employment agreement with TierOne Bank, described above. Mr.
Lundstrom may be terminated for cause if he (i) willfully fails to perform his
duties under the agreement, other than any such failure resulting from his incapacity due
to physical or mental illness; (ii) commits an act involving moral turpitude in the course
of his employment; (iii) engages in willful misconduct; (iv) breaches his fiduciary duties
for personal profit; (v) willfully violates any law, rule, or regulation or final
cease-and-desist order; or (vi) materially breaches the provisions of the agreement.

If
a change in control of TierOne Corporation occurs prior to the end of the term of his
employment agreement, Mr. Lundstrom will be entitled to receive, in addition to any
liquidated damages if his employment is terminated, a lump sum payment equal to the
greater of (i) the salary and cash bonus or incentive compensation he would have received
if his employment had continued until the expiration of the term of his employment
agreement or (ii) three times his base amount from us or our subsidiaries as
defined under Section 280G of the Internal revenue Code, minus $1.00. In the event that
due to a change in control, any amount paid or payable to Mr. Lundstrom would constitute a
parachute payment under Section 280G of the Internal Revenue Code, he will be
entitled to an additional payment such that, on an after-tax basis, he is indemnified for
the excise tax.

21

---

Under
the agreement, change in control means a change in the ownership of TierOne
Bank or TierOne Corporation, a change in the effective control of TierOne Bank or TierOne
Corporation or a change in the ownership of a substantial portion of the assets of TierOne
Bank or TierOne Corporation as provided under Section 409A of the Internal Revenue
Code and the regulations thereunder.

Mr.
          Lundstroms employment agreement also contains a covenant not to compete,
          under which he agrees that if his employment terminates before the expiration
of           the term of his employment agreement (other than a termination of employment
in           connection with or within 12 months of a change in control), he will not
compete           with us in any county in which we maintain an office until the
expiration of the           earlier of two years from the date on which his employment
terminates or the           date on which the term of his employment agreement would
otherwise expire. In           addition, for two years after his employment terminates,
he agrees to not           solicit our customers or solicit our employees to accept other
employment in the           counties where we maintain offices.

TierOne
Corporations Agreement with Mr. Laphen

TierOne
Corporation also entered into a three-year employment agreement with Mr. Laphen as
President and Chief Operating Officer. The provisions of Mr. Laphens contract,
including the non-duplication provisions, are substantially identical to those of Mr.
Lundstroms, described above, except that (i) payment of the liquidated damages are
triggered by, among other circumstances described above, an event of
termination as such term is defined in Mr. Laphens employment agreement with
TierOne Bank, rather than upon a voluntary termination by Mr. Laphen for good reason, and
(ii) in the event of a change in control of us which occurs prior to the expiration of the
term of his employment agreement, he will be entitled to receive the greater of the amount
of liquidated damages provided by the employment agreement or the amount due as a result
of a change in control. Mr. Laphen will not receive both liquidated damages and
change in control benefits.

# Change in Control
Agreements

We
have entered into change in control agreements with several executive officers including
Messrs. Witkowicz, Furnas and Ludemann, none of whom are covered by an employment
agreement. The terms of the change in control agreements for the named executive officers
are three years and are renewed on an annual basis unless and until written notice of
non-renewal is given by our Board of Directors. The change in control agreements provide
that if the executives employment is terminated subsequent to a change in control
and during the term of the agreement by either us or TierOne Bank (for other than
cause, disability, retirement or death of the executive), or by the executive
for good reason, the executive is entitled to receive a severance payment
equal to three times the executives highest level of aggregate base salary and cash
incentive compensation paid to him during the calendar year in which the termination
occurs (determined on an annualized basis) or either of the two calendar years immediately
preceding the calendar year in which the termination occurs, as elected by the executive.
We also agree to maintain and provide, at no cost to the executive, for the
executives continued participation in all group insurance, life insurance, health
and accident insurance, disability insurance and other employee benefit plans and
arrangements (excluding the employee stock ownership plan and any other stock benefit
plans as well as any cash incentive compensation) for the period ending the earlier of the
expiration of the remaining term of the change in control agreement or the date of the
officers full-time employment with another party pursuant to which the executive
receives substantially similar benefits. To the extent such benefits would trigger the 20%
tax and interest penalties under Section 409A of the Internal Revenue Code, he will
receive a cash payment in lieu of, and equal to, the value of such benefits.

In
the event payments and benefits under the change in control agreements, together with
other payments and benefits the officers may receive, would constitute an excess parachute
payment under Section 280G of the Internal Revenue Code, such payments would be reduced to
an amount necessary to avoid such payments constituting parachute payments.

22

---

Under
the agreement, a change in control occurs upon a change in the ownership of
TierOne Bank or TierOne Corporation, a change in the effective control of TierOne Bank or
TierOne Corporation or a change in the ownership of a substantial portion of the assets of
TierOne Bank or TierOne Corporation as provided under Section 409A of the Internal
Revenue Code and the regulations thereunder.

Termination
for cause means termination because of personal dishonesty, incompetence,
willful misconduct, breach of fiduciary duty involving personal profit, intentional
failure to perform stated duties, or willful violation of any law, rule or regulation or
final cease and desist order.

An
executive may terminate his employment for good reason upon (i) the assignment
to the executive of any duties which are materially inconsistent with the executives
positions, duties, responsibilities and status immediately prior to the change in control,
or a material change in the executives reporting responsibilities, titles or offices
as an employee and as in effect immediately prior to such a change in control, or any
removal of the executive from or any failure to re-elect the executive to any of such
responsibilities, titles or offices; (ii) a reduction in the executives base salary
as in effect immediately prior to the date of the change in control; (iii) a change in the
executives principal place of employment by distance in excess of 25 miles from its
location immediately prior to the change in control; (iv) any purported termination of the
executives employment for disability or retirement which is not effected pursuant to
the requirements set forth in the agreements; or (v) the failure to obtain the assumption
of and agreement to perform the agreements from any successor as contemplated in the
agreements.

# Director Compensation

The
following table sets forth information regarding the compensation received by each of the
directors of TierOne Bank and TierOne Corporation during 2007, other than Messrs.
Lundstrom and Laphen as their compensation for service as directors is fully reflected in
the Summary Compensation Table and the other related tables in the discussion above.

|                     
|---------------------
|
|Name                 
|Joyce Person Pocras  
|                     
|Campbell R. McConnell
|                     
|Ann Lindley Spence   
|                     
|Charles W. Hoskins   
|                     

---

|(1) | These
amounts reflect the dollar value of the compensation cost of all
               outstanding stock awards or option awards recognized over the requisite
service                period, computed in accordance with FAS 123(R). The assumptions
made in valuing                the stock awards are included under the caption Stock
Based Benefit                Plans in Note 18 of Notes to Consolidated Financial
Statements in this                Annual Report on Form 10-K, as amended. There were no
stock awards or options                granted in 2007. As of December 31, 2007, the
outstanding number of stock awards                for directors were: Joyce Pocras
(9,030), Campbell McConnell (9,030), Ann Spence                (9,030) and Charles
Hoskins (4,000). As of December 31, 2007, the outstanding                number of
options for directors were: Joyce Pocras (112,875), Campbell McConnell
               (112,875), Ann Spence (112,875) and Charles Hoskins (25,000).
The stock option exercise price for Directors Pocras, Spence and McConnell is $17.83 and for Director Hoskins it is $22.40.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Represents
the dollar value of life, health and dental insurance premiums paid                on
behalf of Joyce Pocras, Campbell McConnell, Ann Spence and Charles Hoskins
               and dividends earned on restricted stock awards.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Director Fees

Directors
currently receive a fee of $2,500 for each regularly scheduled monthly and special board
meeting of TierOne Bank, regardless of attendance (they received the same fee in 2007).
Members of the Audit, Compensation and Nominating and Corporate Governance Committees of
TierOne Bank and/or TierOne Corporation, and independent directors who participate in
executive session meetings as required by NASDAQ Marketplace Rule 4350(c)(2), receive an
additional fee equal to one-half the regular board meeting fee, but only if present at the
meeting in person or by telephone. Only one fee is paid for joint Board committee meetings
of TierOne Bank and TierOne Corporation. Non-employee directors also currently receive
life, health and dental insurance benefits through TierOne Bank. Directors currently do
not receive additional cash fees for service as directors of TierOne Corporation.

23

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# Directors Deferred
Compensation Program

Until
July 27, 2006 we maintained a separate deferred compensation program for our non-employee
directors. The deferred compensation plan for directors was superseded and merged in to
the Amended and Restated Deferred Compensation Plan as of July 27, 2006. The 2006 deferred
compensation plan, including its application to directors of TierOne Bank and TierOne
Corporation, is described in detail above in the narrative discussion that follows the
Non-Qualified Deferred Compensation table.

# Director Consultation
Plan

In
addition to the above, under the terms of TierOne Banks Consultation Plan for
Directors, any retiring director with ten or more years of service who agrees to provide
consulting or advisory services to the Board of Directors, by entering into an appropriate
consulting agreement, will be entitled to receive an annual benefit equal to the average
of the annual monthly board fees and yearly retainer, if any, paid to such retiring
director for the last three years of service prior to his or her retirement reduced by 20%
for each subsequent year in which the director provides consulting or advisory services to
our Board of Directors. Any retiring director with five or more but less than ten years of
service who agrees to provide consulting or advisory services to the Board of Directors,
by entering into an appropriate consulting agreement, will be entitled to receive 50% of
the annual benefit equal to the average of the annual monthly board fees and yearly
retainer, if any, paid to such retiring director for the last three years of service prior
to his or her retirement reduced by 20% for each subsequent year in which the director
provides consulting or advisory services to our Board of Directors. In the event of a
change in control, the terms and conditions of this plan remain in force for directors
except for any director with less than five years of service who will be entitled to
receive the same level of annual benefits awarded to any director with five or more but
less than ten years of service. The maximum duration for which benefits can be received is
five years. An additional benefit in the same amount as paid to retired directors
participating in the plan will be paid to any participant in the plan who served as
chairman of the board for at least three years.

# Compensation Committee
Report

The Compensation Committee has
reviewed and discussed the Compensation Discussion and Analysis set forth in this
Amendment No. 1 to the Annual Report on Form 10-K/A with management and, based on such
review and discussion, has recommended to the Board of Directors that the Compensation
Discussion and Analysis be included in this Amendment No. 1 to the Annual Report on Form
10-K/A.

Members of the
Compensation Committee

Joyce Person PocrasAnn
Lindley SpenceCharles W. Hoskins  Campbell R. McConnell

# Compensation Committee
Interlocks and Insider Participation

Determinations
regarding compensation of our Chief Executive Officer, Chief Operating Officer and other
named executive officers are made by the Compensation Committee of the Board of Directors.
Mesdames Pocras and Spence, Mr. Hoskins and Dr. McConnell are members of the Compensation
Committee.

No
person who served as a member of the Compensation Committee during 2007 was a current or
former officer or employee of TierOne Corporation or TierOne Bank, other than Ms. Pocras
who served as TierOne Banks Internal Auditor until 1993. None of the members engaged
in certain transactions with TierOne Corporation or TierOne Bank which were required to be
disclosed by regulations of the Securities and Exchange Commission. Additionally, there
were no compensation committee interlocks during 2007, which means that no
executive officer of TierOne Corporation served as a director or member of the
compensation committee of another entity, one of whose executive officers served as a
director or member of our Compensation Committee.

24

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# Item 12. Security
Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

# Security Ownership

Unless
otherwise noted in a specific footnote reference, the following table sets forth as of
March 12, 2008 certain information as to the common stock beneficially owned by (a) each
person or entity, including any group as that term is used in Section 13(d)(3)
of the Securities Exchange Act of 1934, who or which was known to us to be the beneficial
owner of more than 5% of the issued and outstanding common stock, (b) our directors
(including the nominees), (c) the named executive officers; and (d) all directors,
nominees for director and executive officers as a group.

|Name of Beneficial
Owner or Number of
Persons in Group  | Amount and Nature
of Beneficial
Ownership as of
March 12, 2008(1) | Percent of
Common Stock
|------------------------------------------------------- | ----------------------------------------------------------------- | -----------------------
|TierOne Corporation Employee Stock Ownership Plan Trust |                                                                   |                        
|1235 N Street Lincoln, Nebraska 68508                   |                                                                   |                        
|Private Capital Management, L.P. Bruce S. Sherman       |                                                                   |                        
|Gregg J. Powers 8889 Pelican Bay Boulevard              |                                                                   |                        
|Naples, Florida 34108                                   |                                                                   |                        
|West Family Investments, LLC 1603 Orrington, Suite 810  |                                                                   |                        
|Evanston, Illinois 60201                                |                                                                   |                        
|Directors:                                              |                                                                   |                        
|Gilbert G. Lundstrom                                    |                                                                   |                        
|James A. Laphen                                         |                                                                   |                        
|Campbell R. McConnell                                   |                                                                   |                        
|Joyce Person Pocras                                     |                                                                   |                        
|Charles W. Hoskins                                      |                                                                   |                        
|Ann Lindley Spence                                      |                                                                   |                        
|Other Named Executive Officers:                         |                                                                   |                        
|Roger R. Ludemann                                       |                                                                   |                        
|Gale R. Furnas                                          |                                                                   |                        
|Eugene B. Witkowicz                                     |                                                                   |                        
|All Directors and Executive Officers of TierOne         |                                                                   |                        
|Corporation and TierOne Bank as a group (12 persons)    |                                                                   |                        

---

|* | Represents
less than 1% of the outstanding stock.
|- | -------------------------------------------------

|(1) | Based
upon filings made pursuant to the Securities Exchange Act of 1934 and
               information furnished by the respective individuals. Under regulations
               promulgated pursuant to the Securities Exchange Act of 1934, shares of
common                stock are deemed to be beneficially owned by a person if he or she
directly or                indirectly has or shares (i) voting power, which includes the
power to vote or                to direct the voting of the shares, or (ii) investment
power, which includes the                power to dispose or to direct the disposition of
the shares. Unless otherwise                indicated, the named beneficial owner has
sole voting and dispositive power with                respect to the shares.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | The
TierOne Corporation Employee Stock Ownership Plan Trust was established
               pursuant to the TierOne Corporation employee stock ownership plan.
Delaware                Charter Guarantee & Trust Company d/b/a Principal Trust
Company currently                serves as trustee of the plan.  As of December 31, 2007,
a total of 751,338 shares held in the trust had been allocated to the accounts of
participating employees. Under the terms of the employee stock ownership plan, the
trustee votes all allocated shares held in the employee stock ownership plan in
accordance with the instructions of the participating employees. Allocated shares for
which employees do not give instructions generally will not be voted, subject to the
fiduciary duties of the trustee and unallocated shares generally are voted in the same
ratio on any matter as to those shares for which instructions are given. The Delaware
Charter Guarantee & Trust Company d/b/a Principal Trust Company also acts as trustee
of the TierOne Bank Savings Plan, which holds 346,722 shares, and Principal Trust Company
disclaims beneficial ownership of these shares and the shares held by the TierOne
Corporation Employee Stock Ownership Plan Trust.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

25

---

|(3) | The
information regarding beneficial ownership by Private Capital Management,
               L.P., Bruce S. Sherman and Gregg J. Powers is reported by them in an
amended                statement on Schedule 13G/A, dated December 31, 2007, as filed
with the                Securities and Exchange Commission. Private Capital Management,
Mr. Sherman and                Mr. Powers reported shared voting and shared dispositive
power over 1,538,439                shares. Private Capital Management, L.P. filed the
Schedule 13G/A on behalf of                Private Capital Management, L.P., Bruce S.
Sherman, its Chief Executive Officer,                and Gregg J. Powers, its President.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | The
information regarding beneficial ownership by West Family Investments, LLC
               is reported in a jointly filed statement on Schedule 13G, dated December
31,                2007, as filed with the Securities and Exchange Commission. The filing
indicates                that West Family Investments, LLC has shared voting and
dispositive power over                155,585 shares; Gary L. West has shared voting and
dispositive power over                535,288 shares; Mary E. West has shared voting and
dispositive power over                535,273 shares; Randy Rochman has shared and
dispositive power over 961,148                shares; Elizabeth Rochman has sole voting
and dispositive power over 2,200                shares and shared voting and dispositive
power over 56,172 shares; Barton                Rochman has sole voting and dispositive
power over 6,739 shares; Susan Temple                has sole voting and dispositive
power over 2,200 shares; Jim Young has sole                voting and dispositive power
over 400 shares; Andy McDill has sole voting and                dispositive power over
350 shares; Johnny Bubb has sole voting and dispositive                power over 1,560
shares; Dennis M. OBrien has sole voting and dispositive                power over
10,000 shares; and Chad Sandstedt has sole voting and dispositive                power
over 3,300 shares.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(5) | (a)
Includes options to acquire shares of our common stock that were exercisable
               on March 12, 2008, or 60 days thereafter, under our 2003 Stock Option Plan
as                follows:
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Name                                    | Number of Shares
|--------------------------------------- | ----------------
|Gilbert G. Lundstrom                    | 542,000         
|James A. Laphen                         | 270,000         
|Campbell R. McConnell                   | 112,875         
|Joyce Person Pocras                     | 112,875         
|Ann Lindley Spence                      | 112,875         
|Charles W. Hoskins                      | 15,000          
|Roger R. Ludemann                       | 90,000          
|Gale R. Furnas                          | 90,000          
|Eugene B. Witkowicz                     | 90,000          
|All Directors and Executive Officers of
|TierOne Corporation and TierOne        
|Bank as a group ( 12 persons)           | 1,524,801       

| | (b)
           Includes unvested shares over which the directors or officers have voting
power           which have been granted pursuant to the 2003 Recognition and Retention
Plan and           are held in the associated trust, as follows:
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Name                                    | Number of Shares
|--------------------------------------- | ----------------
|Gilbert G. Lundstrom                    | 44,000          
|James A. Laphen                         | 22,000          
|Campbell R. McConnell                   | 9,030           
|Joyce Person Pocras                     | 9,030           
|Charles W. Hoskins                      | 4,000           
|Ann Lindley Spence                      | 9,030           
|Roger R. Ludemann                       | 8,000           
|Gale R. Furnas                          | 8,000           
|Eugene B. Witkowicz                     | 8,000           
|All Directors and Executive Officers of
|TierOne Corporation and TierOne         | 135,690         
|Bank as a group (12  persons)          

|(6) | Includes
80,000 shares held jointly with Mr. Lundstroms wife, 6,219 shares
               held in Mr. Lundstroms account in TierOne Banks 401(k) savings
plan,                15,000 shares held in Mr. Lundstroms IRA account, 81,000
shares held in                two trusts in which Mr. Lundstroms spouse has a
pecuniary interest, 8,024                shares which have been allocated to Mr. Lundstroms
account in the employee                stock ownership plan and 176,000 vested shares
allocated to Mr. Lundstrom from                TierOne Corporations 2003
Recognition and Retention Plan.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(7) | Includes
30,350 shares held jointly with Mr. Laphens wife, 52 shares held                in
Mr. Laphens account in TierOne Banks 401(k) savings plan, 8,024
               shares which have been allocated to Mr. Laphens account in the
employee                stock ownership plan, 6,300 shares held by Mr. Laphen in his IRA
account and                76,500 vested shares allocated to Mr. Laphen from TierOne
Corporations                2003 Recognition and Retention Plan.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(8) | Includes
50,000 shares held jointly with Dr. McConnells wife and 36,120
               vested shares allocated to Dr. McConnell from TierOne Corporations
2003                Recognition and Retention Plan.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(9) | Includes
16,000 shares held by Ms. Pocras husband, 2,500 shares held in                Ms.
Pocras IRA account, 12,448 shares held in Ms. Pocras account in
               TierOne Banks 401(k) savings plan and 11,030 vested shares allocated
to                Ms. Pocras from TierOne Corporations 2003 Recognition and
Retention Plan.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(10) | Includes
500 shares held by Mr. Hoskins in his IRA account, and 6,000 vested                shares
allocated to Mr. Hoskins from TierOne Corporations 2003 Recognition
               and Retention Plan.
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(11) | Includes
27,000 shares held jointly with Ms. Spences husband and 36,120
               vested shares allocated to Ms. Spence from TierOne Corporations 2003
               Recognition and Retention Plan.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

26

---

|(12) | Includes
25,321 shares held in Mr. Ludemanns account in TierOne                Banks
401(k) savings plan, 6,309 shares allocated to Mr. Ludemanns                account
in the employee stock ownership plan, 9,700 shares held in Mr.                Ludemanns
IRA account, 10,000 shares held directly by Mr. Ludemann, 15,560                shares
held by Mr. Ludemanns wife and 29,484 vested shares allocated to                Mr.
Ludemann from TierOne Corporations 2003 Recognition and Retention
               Plan.
|---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(13) | Includes
16,953 shares held in Mr. Furnas account in TierOne Banks
               401(k) savings plan, 7,365 shares which have been allocated to Mr. Furnas               account
in the employee stock ownership plan, 1,935 shares held by Mr. Furnas in
               his IRA account, and 32,000 vested shares allocated to Mr. Furnas from
TierOne                Corporations 2003 Recognition and Retention Plan.
|---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(14) | Includes
8,500 shares held jointly with Mr. Witkowiczs wife, 27,500 shares
               held in Mr. Witkowiczs account in TierOne Banks 401(k) savings
plan,                6,842 shares which have been allocated to Mr. Witkowiczs
account in the                employee stock ownership plan and 26,968 vested shares
allocated to Mr.                Witkowicz from TierOne Corporations 2003
Recognition and Retention Plan.
|---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

# Equity Compensation Plan
Information

The
following table sets forth certain information for all equity compensation plans and
individual compensation arrangements (whether with employees or non-employees, such as
directors), in effect as of December 31, 2007:

|Plan Category             | Number of Shares to be Issued 
Upon the Exercise of Outstanding
Options, Restricted Stock Grants,
Warrants and Rights | Weighted-Average 
Exercise Price of
Outstanding Options
Restricted Stock Grants,
Warrants and Rights | Number of Shares Remaining 
Available for Future Issuance 
(Excluding Shares Reflected in 
the First Column)
|------------------------- | --------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------
|Equity compensation plans |                                                                                                                       |                                                                                                      |                                                                                                             
|approved by               |                                                                                                                       |                                                                                                      |                                                                                                             
|security holders          |                                                                                                                       |                                                                                                     
|Equity compensation plans |                                                                                                                       |                                                                                                     
|not approved by security  |                                                                                                                       |                                                                                                     
|holders                   |                                                                                                                       |                                                                                                      |                                                                                                             
|                         
|Total                     |                                                                                                                       |                                                                                                      |                                                                                                             
|                         

# Item 13. Certain
Relationships and Related Transactions, Director Independence

# Transactions With
Certain Related Persons

Presently,
TierOne Bank offers only educational, checking overdraft and loans on savings accounts to
its senior executive officers and directors. In accordance with applicable federal laws
and regulations, TierOne Bank offers mortgage loans to its other officers and employees as
well as members of their immediate families for the financing of their primary residences
and certain other loans. These loans are generally made on substantially the same terms as
those prevailing at the time for comparable transactions with non-affiliated persons. It
is the belief of management that these loans neither involve more than the normal risk of
collectibility nor present other unfavorable features.

Section
22(h) of the Federal Reserve Act generally provides that any credit extended by a savings
institution, such as TierOne Bank, to its executive officers, directors and, to the extent
otherwise permitted, principal shareholder(s), or any related interest of the foregoing,
must be on substantially the same terms, including interest rates and collateral, as those
prevailing at the time for comparable transactions by the savings institution with
non-affiliated parties; unless the loans are made pursuant to a benefit or compensation
program that (a) is widely available to employees of the institution, and (b) does not
give preference to any director, executive officer or principal shareholder, or certain
affiliated interests of either, over other employees of the savings institution and does
not involve more than the normal risk of repayment or present other unfavorable features.
TierOne Banks policy is in compliance with Section 22(h) of the Federal Reserve Act.

27

---

Our
Board of Directors has adopted written policies and procedures regarding related person
transactions. For purposes of these policies and procedures:

| |  | A
related person means any (a) person who is, or was at some time since the
beginning of the last fiscal year, an executive officer, director or nominee for election
as a director, (b) greater than 5 percent beneficial owner of our common stock, or (c)
immediate family member of the foregoing; and
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | A
related person transaction means any transaction, arrangement or relationship
or series of similar transactions, arrangements or relationships (including any
indebtedness or guarantee of indebtedness) in which (a) the aggregate amount involved
will or may be expected to exceed $100,000 in any calendar year, (b) we are a
participant, and (c) any related person has or will have a direct or indirect interest
(other than solely as a result of being a director or a less than 10 percent beneficial
owner of another entity).
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Each
of our executive officers and directors is required to disclose to the Audit
Committee certain information relating to related person transactions for review and
pre-approval by the Audit Committee, as required by NASDAQ listing standards.
Disclosure to the Audit Committee should occur before, if possible, or as soon as
practicable after the related person transaction is effected, but in any event as soon as
practicable after the executive officer, director or nominee for director becomes aware of
the related person transaction. The Audit Committees decision whether or not to
approve or ratify a related person transaction is to be made in light of the Audit
Committees determination that consummation of the transaction is not or was not
contrary to our best interests. Any related person transaction must be disclosed to the
full Board of Directors. We had no related person transactions during 2007 and none are
currently proposed.

# Availability of Certain
Corporate Governance Documents

The
Companys Board of Directors has adopted corporate governance guidelines, an ethics
policy and written charters for each of the Audit Committee, Compensation Committee and
Corporate Governance and Nominating Committee. The corporate governance guidelines, ethics
policy and written committee charters are available on the Companys website at
www.tieronebank.com under Investor Relations  Corporate
Governance. Each of these documents are also available in print upon written request
to: TierOne Corporation, Attention: Mr. Edward J. Swotek, 1235 N Street, Lincoln, Nebraska
68508.

# Other Shareholder
Communications

Our
Board of Directors has adopted a formal process by which shareholders may communicate with
the Board. Shareholders who wish to communicate with the Board may do so by sending
written communications addressed to the Board of Directors of TierOne Corporation, c/o
Eugene B. Witkowicz, Corporate Secretary, at 1235 N Street, Lincoln, Nebraska 68508. Mr.
Witkowicz will forward all such communications to the director or directors to whom they
are addressed.

# Director Independence

Our
Board of Directors has affirmatively determined that all of the directors (other than
Messrs. Lundstrom and Laphen) are independent as defined in the listing
standards of NASDAQ. None of the independent directors had any transactions, relationships
or arrangements with the Company that were not otherwise disclosed in this Amendment No. 1
to the Annual Report on Form 10-K/A, and were considered by the Board in making the
independence determination.

# Item 14. Principal
Accounting Fees and Services

# Audit Fees

The
following table sets forth the aggregate fees paid by us to KPMG LLP for professional
services rendered by KPMG LLP in connection with the audit of TierOne Corporations
consolidated financial statements for 2007 and 2006, as well as the fees paid by us to
KPMG LLP for audit-related services, tax services and all other services rendered by KPMG
LLP to us during 2007 and 2006.

28

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|                     
|---------------------
|2007                 
|Audit fees(1)        
|Audit-related fees(2)
|Tax fees(3)          
|All other fees       
|                     
|Total                

---

|(1) | Audit
fees consist of fees incurred in connection with the audit of our annual
               financial statements and the review of the interim financial statements
included                in our quarterly reports filed with the Securities and Exchange
Commission, as                well as work generally only the independent auditor can
reasonably be expected                to provide, such as statutory audits, consents and
assistance with and review of                documents filed with the Securities and
Exchange Commission and fees related to                certification reports required
under the Sarbanes-Oxley Act and the Federal                Deposit Insurance Corporation
Improvement Act of 1991.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Audit-related
fees consist of fees incurred in connection with audits of the                financial
statements of our employee benefit plans, and services provided in
               relation to the Sarbanes-Oxley Act, other internal control and due
diligence                services and consents rendered in connection with the filings
related to a                proposed merger prior to the termination of the merger
agreement.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Tax
fees consist primarily of fees paid in connection with preparing federal and
               state income tax returns, researching and filing a change in accounting
method                with the Internal Revenue Service and other tax related services.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The
Audit Committee pre-approves all audit services to be provided by the independent auditors
to TierOne Corporation. The Audit Committee also reviews and pre-approves all
audit-related and non-audit related services rendered by our independent auditors in
accordance with the Audit Committees charter. In its review of these services and
related fees and terms, the Audit Committee considers, among other things, the possible
effect of the performance of such services on the independence of our independent
auditors. The Audit Committee pre-approves certain audit-related services and certain
non-audit related tax services which are specifically described by the Audit Committee on
an annual basis and separately approves other individual engagements as necessary. The
Chair of the Audit Committee has been delegated the authority to approve non-audit related
services in lieu of the full Audit Committee. On a quarterly basis, the Chair of the Audit
Committee presents any previously approved engagements to the full Audit Committee.

Each
new engagement of KPMG LLP was approved in advance by the Audit Committee or its Chair,
and none of those engagements made use of the de minimis exception to pre-approval
contained in the Securities and Exchange Commissions rules.

29

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# PART IV

# Item 15. Exhibits,
Financial Statement Schedules

| | (1)
Financial Statements
| | ------------------------

| | The
following financial statements of the registrant and its subsidiaries are filed as part
of this document under Item 8. Financial Statements and Supplementary Data, and
are incorporated herein by this reference:
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Consolidated
Statements of Financial Condition at December 31, 2007 and 2006;
| | - | -----------------------------------------------------------------------------

| |  | Consolidated
Statements of Operations for the years ended December 31, 2007, 2006 and 2005;
| | - | -------------------------------------------------------------------------------------------

| |  | Consolidated
Statements of Changes in Stockholders Equity and Comprehensive Income for the years
ended December 31, 2007, 2006 and 2005;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------

| |  | Consolidated
Statements of Cash Flows for the years ended December 31, 2007, 2006 and 2005;
| | - | -------------------------------------------------------------------------------------------

| |  | Notes
to Consolidated Financial Statements; and
| | - | -----------------------------------------------

| |  | Report
of Independent Registered Public Accounting Firm
| | - | -------------------------------------------------------

| | (2)
Financial Statement Schedules
| | ---------------------------------

| | All
schedules are omitted because they are not required or are not applicable or the required
information is shown in the consolidated financial statements or notes thereto.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (3)
Exhibits
| | ------------

| | The
exhibits filed or incorporated by reference herewith are as specified in the Exhibit
Index.
| | -----------------------------------------------------------------------------------------------

30

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# SIGNATURES

Pursuant to the requirements of
Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused
this Amendment No. 1 to the Annual Report on Form 10-K/A to be signed on its behalf by the
undersigned, thereunto duly authorized.

|                     | TIERONE CORPORATION                              
|-------------------- | -------------------------------------------------
|Date: April 25, 2008 | By: /s/ Gilbert G. Lundstrom                     
|                     | Gilbert G. Lundstrom                             
|                     | Chairman of the Board and Chief Executive Officer

31

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# Exhibit Index

|No.   | Exhibits                                                                                                     | Location        
|----- | ------------------------------------------------------------------------------------------------------------ | ----------------
|2.1   | Stock Purchase Agreement, dated as of March 30, 2004, among TierOne Corporation,                             |                 
|      | United Nebraska Financial Co. and the Shareholders of United Nebraska Financial Co.                          | (1)             
|2.2   | Agreement and Plan of Merger, dated as of May 17, 2007, by and among CapitalSource Inc.,                    
|      | CapitalSource TRS Inc. and TierOne Corporation (a)                                                           | (8)             
|3.1   | Articles of Incorporation of TierOne Corporation                                                             | (2)             
|3.2   | Bylaws of TierOne Corporation                                                                                | (2)             
|4.0   | Forms of Stock Certificate of TierOne Corporation                                                            | (2)             
|10.1  | Amended and Restated Employment Agreement between TierOne Bank and Gilbert G. Lundstrom*                     | (6)             
|10.2  | Amended and Restated Employment Agreement between TierOne Bank and James A. Laphen*                          | (6)             
|10.3  | Amended and Restated Employment Agreement between TierOne Corporation and Gilbert G. Lundstrom*              | (6)             
|10.4  | Amended and Restated Employment Agreement between TierOne Corporation and James A. Laphen*                   | (6)             
|10.5  | Amended and Restated 1993 Supplemental Retirement Plan Agreement between TierOne Bank and                   
|      | Gilbert G. Lundstrom*                                                                                        | (6)             
|10.6  | Form of Amended and Restated Three-Year Change in Control Agreement between TierOne Bank,                   
|      | TierOne Corporation and certain executive officers*                                                          | (6)             
|10.7  | Form of Amended and Restated Two-Year Change in Control Agreement between TierOne Bank,                     
|      | TierOne Corporation and certain executive officers*                                                          | (6)             
|10.8  | TierOne Bank Amended and Restated Employee Severance Plan*                                                   | (6)             
|10.9  | Amended and Restated Supplemental Executive Retirement Plan for the TierOne Corporation Employee            
|      | Stock Ownership Plan*                                                                                        | (6)             
|10.10 | Amended and Restated Supplemental Executive Retirement Plan for the TierOne Bank Savings Plan*               | (6)             
|10.11 | TierOne Bank Amended and Restated Deferred Compensation Plan*                                                | Filed Previously
|10.12 | Fourth Amended and Restated Consultation Plan for Directors*                                                 | (6)             
|10.13 | TierOne Bank Management Incentive Compensation Plan*                                                         | (4)             
|10.14 | Form of Trust Agreement for Deferred Compensation and Supplemental Executive Retirement Plans of            
|      | TierOne Corporation and TierOne Bank*                                                                        | (6)             
|10.15 | Amended and Restated 2003 Stock Option Plan*                                                                 | (6)             
|10.16 | Form of Non-employee Director Compensatory Stock Option Agreement for use under the                         
|      | 2003 Stock Option Plan*                                                                                      | (5)             
|10.17 | Form of Employee Compensatory Stock Option Agreement for use under the 2003 Stock Option Plan*               | (5)             
|10.18 | Form of Employee Incentive Stock Option Agreement for use under 2003 Stock Option Plan*                      | (5)             
|10.19 | Amended and Restated 2003 Management Recognition and Retention Plan and Trust Agreement*                     | (6)             
|10.20 | Form of award agreements for use under the Management Recognition and Retention                             
|      | Plan and Trust Agreement*                                                                                    | (5)             
|10.21 | First Amendment to Amended and Restated Employment Agreement between TierOne Corporation and                
|      | Gilbert G. Lundstrom*                                                                                        | (7)             
|10.22 | First Amendment to Amended and Restated Employment Agreement between TierOne Corporation and                
|      | James A. Laphen*                                                                                             | (7)             
|10.23 | First Amendment to TierOne Bank Savings Plan Amended and Restated Supplemental Executive                    
|      | Retirement Plan*                                                                                             | (7)             
|21    | Subsidiaries of the Registrant - Item 1. Business - Subsidiary Activities of TierOne Corporations Annual  |                 
|      | Report on Form 10-K for the year ended December 31, 2007 is incorporated by reference herein                 | -               
|23    | Consent of KPMG LLP                                                                                          | Filed Previously
|31.1  | Certification pursuant to Rule 13a-14 of the Securities Exchange Act of 1934, as amended, as adopted        
|      | pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                    | Filed Herewith  
|31.2  | Certification pursuant to Rule 13a-14 of the Securities Exchange Act of 1934, as amended, as adopted        
|      | pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                                    | Filed Herewith  
|32.1  | Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002           | Filed Herewith  
|32.2  | Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002           | Filed Herewith  
|     
|*     | Denotes a management contract or compensatory plan or arrangement.                                           |                 
|(a)   | The disclosure schedules and exhibits to the Agreement and Plan of Merger were not filed with the Agreement. |                 
|      | TierOne Corporation has agreed to furnish supplementally a copy of any such schedules or exhibits            |                 
|      | to the Securities and Exchange Commission upon request.                                                      |                 
|(1)   | Incorporated by reference to Exhibit 2 of TierOne Corporations Form 8-K filed on                            |                 
|      | August 31, 2004.                                                                                             |                 
|(2)   | Incorporated by reference to TierOne Corporations Registration Statement on Form S-1,                       |                 
|      | filed on April 8, 2002, as amended and declared effective on August 12, 2002 (File No. 333-85838)            |                 
|(3)   | Incorporated herein by reference to TierOne Corporations definitive proxy                                   |                 
|      | statement filed by TierOne Corporation with the SEC on March 31, 2003.                                       |                 
|(4)   | Incorporated by reference to TierOne Corporations Annual Report on                                          |                 
|      | Form 10-K for the year ended December 31, 2002 filed by TierOne Corporation                                  |                 
|      | with the SEC on March 28, 2003.                                                                              |                 
|(5)   | Incorporated by reference to TierOne Corporations Annual Report on Form 10-K for the year                   |                 
|      | ended December 31, 2004 filed by TierOne Corporation with the SEC on March 9, 2005.                          |                 
|(6)   | Incorporated by reference to TierOne Corporations Form 8-K filed on August 2, 2006.                         |                 
|(7)   | Incorporated by reference to TierOne Corporations Annual Report on Form 10-K for the year                   |                 
|      | ended December 31, 2006 filed by TierOne Corporation with the SEC on March 12, 2007.                         |                 
|(8)   | Incorporated by reference to TierOne Corporations Form 8-K filed on May 23, 2007.                           |                 
|     

32