Unassociated Document


    Exhibit
      4.3

    


    Flushing
      Financial Corporation

    1979
      Marcus Avenue, Suite E140

    Lake
      Success, New York 11042

    


    July
      1,
      2006

     

    STOCK
      OPTION ASSUMPTION AGREEMENT

     

    Dear
      Optionee:

     

    As
      you
      know, on June 30, 2006 (the “Closing Date”), Atlantic Liberty Financial Corp.
      (“ALFC”) merged with and into Flushing Financial Corporation (“FFC”), a Delaware
      corporation (the “Merger”) pursuant to the Agreement and Plan of Merger by and
      between FFC and ALFC dated December 20, 2005 (the “Merger Agreement”). In the
      Merger, each holder of shares of ALFC common stock could elect to receive (i)
      $24.00 in cash (the “Cash Consideration”), (ii) 1.43 shares (the “Exchange
      Ratio”) of FFC common stock (the “Stock Consideration”), or (iii) a combination
      of Cash Consideration and the Stock Consideration for each share of ALFC common
      stock. On the Closing Date you held one or more outstanding options to purchase
      shares of ALFC common stock granted to you under the ALFC 2003 Incentive Stock
      Benefit Plan (the “Plan”) and documented with a Stock Option Agreement(s) and
      any amendment(s) or waiver(s) thereto (collectively, the “Option Agreement”)
      issued to you under the Plan (the “ALFC Options”). In accordance with Section
      3.4.2 of the Merger Agreement, on the Closing Date, FFC assumed all obligations
      of ALFC and succeeded to the rights of ALFC under the Plan. ALFC Options which
      holders thereof elected to convert into options to acquire shares of FFC common
      stock (the “FFC Options”) pursuant to Section 3.4.1(ii) of the Merger Agreement
      will be converted into FFC Options upon execution and delivery of this Stock
      Option Assumption Agreement (the “Agreement”). This Agreement evidences the
      assumption of the ALFC Options, including the necessary adjustments to the
      ALFC
      Options required by the Merger.

    


    A
      schedule of your ALFC Options immediately before and after the Merger is
      attached to this Agreement. The post-merger adjustments are based on the
      Exchange Ratio and are intended to: (i) to preserve, on a per share basis,
      the
      ratio of exercise price to fair market value that existed immediately prior
      to
      the Merger; and (ii) to the extent applicable by law, to retain incentive stock
      option (“ISO”) status under the Federal tax laws.

    


    Following
      the Merger, unless the context otherwise requires, any references in the Plan
      and the Option Agreement (i) to the “Company” means FFC, (ii) to “Stock,” or
“Common Stock” means shares of FFC common stock, (iii) to the “Board of
      Directors” or the “Board” means the Board of Directors of FFC and (iv) to the
“Committee” means the Compensation Committee of the FFC Board of Directors. All
      references in the Option Agreement and the Plan relating to your status as
      an
      employee of ALFC will now refer to your status as an employee of FFC or any
      present or future FFC subsidiary. To the extent the Option Agreement allowed
      you
      to deliver shares of ALFC common stock as payment for the exercise price, shares
      of FFC common stock may be delivered in payment of the adjusted exercise price,
      and the period for which such shares were held as ALFC common stock prior to
      the
      Merger will be taken into account.

    


    The
      grant
      date and the expiration date of your converted FFC Options remain the same
      as
      set forth in your Option Agreement, but all of your converted FFC Options are
      fully vested as a result of the Merger. All other provisions which govern either
      the exercise or the termination of your converted FFC Options remain the same
      as
      set forth in your Option Agreement, and the provisions of the Option Agreement
      (except as expressly modified by this Agreement and the Merger) will govern
      and
      control your rights under this Agreement to purchase shares of FFC common stock.
      Upon your termination of employment with FFC you will have the limited time
      period specified in your Option Agreement to exercise your converted FFC
      Options. Incentive
      Stock Options exercised more than three months after the date you cease to
      be an
      employee of FFC (one year in the case of death or disability) will be treated
      as
      Non-Statutory Stock Options for tax purposes.

    


    To
      exercise your converted FFC Options, you must deliver to the FFC Human Resources
      Department (i) a written notice of exercise for the number of shares of FFC
      common stock you want to purchase, (ii) the adjusted exercise price, and (iii)
      all applicable taxes. The exercise notice and payment should be delivered to
      the
      following address:

    


    Flushing
      Financial Corporation

    Human
      Resources Department

    1979
      Marcus Avenue, Suite 140

    Lake
      Success, New York 11042

    Attention:
      Russ Fleishman

    


    Nothing
      in this Agreement or your Option Agreement interferes in any way with your
      rights and FFC’s rights, which rights are expressly reserved, to terminate your
      employment at any time for any reason. Any future options, if any, you may
      receive from FFC will be governed by the terms of the FFC stock option plan,
      and
      such terms may be different from the terms of your converted FFC Options,
      including, but not limited to, the time period in which you have to exercise
      vested options after your termination of employment.

    


    Please
      sign and date this Agreement and return it promptly to the address listed above.
      If you have any questions regarding this Agreement or your assumed ALFC Options,
      please contact Russ Fleishman at (718) 512-2717.

    


    
      	
              FLUSHING
                FINANCIAL CORPORATION

            
	 	 
	
              By:

            	 
	 	
              A
                duly authorized officer of FFC 

            


    

    


     

    


    ACKNOWLEDGMENT

    


    The
      undersigned acknowledges receipt of the foregoing Stock Option Assumption
      Agreement and understands that all rights and liabilities with respect to each
      of his or her ALFC Options hereby assumed by FFC are as set forth in the Option
      Agreement, the Plan, and such Stock Option Assumption Agreement.

    


    


    
      	
              Date:

            	 	 	
              By:

            	 
	 	 	 	 	
              Optionee

            
	 	 	 	 	 


    

    



    
      
         

      

      
         

        
          

        

      

      
         

      

    


    EXHIBIT
      A

    


    Optionee’s
      Outstanding Options to Purchase Shares

    of
      Atlantic Liberty Financial Corp. Common Stock under the 

    Atlantic
      Liberty Financial Corp. 2003 Incentive Stock Benefit Plan

    (Pre-Merger)

     

    
      	
              Date
                of Option Agreement

            	 	
              Number
                of Incentive

              Stock
                Options (ISOs)

            	 	
              Number
                of Non-Statutory Stock Options (NSSOs)

            	 	
              Total
                Number of 

              Options
                

              (ISOs
                and NSSOs)

            	 	
              Exercise

              Price

            
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	
              $18.50

            
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 


    

    


    Optionee’s
      Outstanding Options to Purchase Shares

    of
      Flushing Financial Corporation Common Stock under the 

    Atlantic
      Liberty Financial Corp. 2003 Incentive Stock Benefit Plan

    (Post-Merger)

     

    
      	
              Date
                of Stock Option Assumption Agreement

            	 	
              Number
                of Incentive

              Stock
                Options (ISOs)

            	 	
              Number
                of Non-Statutory Stock Options (NSSOs)

            	 	
              Total
                Number of 

              Options

              (ISOs
                and NSSOs)

            	 	
              Exercise
                

              Price

            
	 	 	 	 	 	 	 	 	 
	
              July
                1, 2006

            	 	 	 	 	 	 	 	
              $12.94