Document:

Exhibit 10.3

    
      

    

     

    Exhibit
      10.3

     

    
 

    ESOP
      LOAN AGREEMENT

     

    THIS
      LOAN AGREEMENT
      (“Loan
      Agreement”) is made and entered into as of the ___ day of _________, 200__, by
      and between the
      DELANCO FEDERAL SAVINGS BANK EMPLOYEE STOCK OWNERSHIP PLAN
      TRUST
      (“Borrower”), a trust forming part of the Delanco Federal Savings Bank Employee
      Stock Ownership Plan (“ESOP”); and
      DELANCO BANCORP, INC. (“Lender”),
      a corporation organized and existing under the laws of the United States of
      America.

    

    W
      I T N E S S E T H

    

    WHEREAS,
      the Borrower is authorized to purchase shares of common stock of Delanco
      Bancorp, Inc. (“Common Stock”), either directly from Delanco Bancorp, Inc. or in
      open market purchases in an amount not to exceed ________________________,
      (________) shares of Common Stock.

     

    WHEREAS,
      the Borrower is authorized to borrow funds from the Lender for the purpose
      of
      financing authorized purchases of Common Stock; and

    

    WHEREAS,
      the Lender is willing to make a loan to the Borrower for such
      purpose.

    

    NOW,
      THEREFORE, the parties agree hereto as follows:

     

    ARTICLE
      I

    DEFINITIONS

    

    The
      following definitions shall apply for purposes of this Loan Agreement, except
      to
      the extent that a different meaning is plainly indicated by the
      context:

    

    “Business
      Day”
      means
      any day other than a Saturday, Sunday or other day on which banks are authorized
      or required to close under federal or local law or regulation.

    

    “Code”
      means
      the Internal Revenue Code of 1986, as amended (including the corresponding
      provisions of any succeeding law).

    

    “Default”
      means an
      event or condition which would constitute an Event of Default. The determination
      as to whether an event or condition would constitute an Event of Default shall
      be determined without regard to any applicable requirements of notice or lapse
      of time.

    

    “ERISA”
      means
      the Employee Retirement Income Security Act of 1974, as amended (including
      the
      corresponding provisions of any succeeding law).

    

    “Event
      of Default”
      means an
      event or condition described in Article 5.

    

    “Loan”
means
      the loan described in section 2.1.

    

    “Loan
      Documents”
      means,
      collectively, the Loan Agreement, the Promissory Note and the Pledge Agreement
      and all other documents now or hereafter executed and delivered in connection
      with such documents, including all amendments, modifications and supplements
      of
      or to all such documents.

    

    “Pledge
      Agreement”
      means
      the agreement described in section 2.8(a).

    

    “Principal Amount”
      means
      the face amount of the Promissory Note, determined as set forth in section
      2.1(c).

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    

    “Promissory
      Note”
      means
      the promissory note described in section 2.3.

    

    “Register”
      means
      the
      register described in section 2.9.

     

    ARTICLE
      II

    THE
      LOAN; PRINCIPAL AMOUNT;

    INTEREST;
      SECURITY; INDEMNIFICATION

    

    Section
      2.1    The
      Loan; Principal Amount.

    

    (a)    The
      Lender hereby agrees to lend to the Borrower such amount, and at such time,
      as
      shall be determined under this Section 2.1; provided, however, that in no event
      shall the aggregate amount lent under this Loan Agreement from time to time
      exceed the greater of (i) $________ or (ii) the aggregate amount paid by
      the Borrower to purchase up to _______ shares of Common Stock.

    

    (b)    Subject
      to the limitations of Section 2.1(a), the Borrower shall determine the amounts
      borrowed under this Agreement, and the time at which such borrowings are
      effected. Each such determination shall be evidenced in a writing which shall
      set forth the amount to be borrowed and the date on which the Lender shall
      disburse such amount, and such writing shall be furnished to the Lender by
      notice from the Borrower. The Lender shall disburse to the Borrower the amount
      specified in each such notice on the date specified therein or, if later, as
      promptly as practicable following the Lender’s receipt of such notice; provided,
      however, that the Lender shall have no obligation to disburse funds pursuant
      to
      this Agreement following the occurrence of a Default or an Event of Default
      until such time as such Default or Event of Default shall have been
      cured.

    

    (c)    For
      all
      purposes of this Loan Agreement, the Principal Amount on any date shall be
      equal
      to the excess, if any, of:

    

    
      	 	
              (i)

            	
              the
                aggregate amount disbursed by the Lender pursuant to Section 2.1(b)
                on or
                before such date; over

            

    

    

    
      	 	
              (ii)

            	
              the
                aggregate amount of any repayments of such amounts made before such
                date.

            

    

    

    The
      Lender shall maintain on the Register a record of, and shall record in the
      Promissory Note, the Principal Amount, any changes in the Principal Amount
      and
      the effective date of any changes in the Principal Amount.

    

    Section
      2.2    Interest.

    

    (a)    The
      Borrower shall pay to the Lender interest on the Principal Amount, for the
      period commencing with the first disbursement of funds under this Loan Agreement
      and continuing until the Principal Amount shall be paid in full, at a fixed
      rate
      of _____________ percent (_____%) per annum. Interest payable under this
      Agreement shall be computed on the basis of a year of 365 days and actual days
      elapsed (including the first day but excluding the last) occurring during the
      period to which the computation relates.

    

    (b)    Accrued
      interest on the Principal Amount shall be payable by the Borrower on the dates
      set forth in Schedule I to the Promissory Note. All interest on the Principal
      Amount shall be paid by the Borrower in immediately available
      funds.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    

    

    (c)    Anything
      in the Loan Agreement or the Promissory Note to the contrary notwithstanding,
      the obligation of the Borrower to make payments of interest shall be subject
      to
      the limitation that payments of interest shall not be required to be made to
      the
      Lender to the extent that the Lender’s receipt thereof would not be permissible
      under the law or laws applicable to the Lender limiting rates of interest which
      may be charged or collected by the Lender. Any such payment referred to in
      the
      preceding sentence shall be made by the Borrower to the Lender on the earliest
      interest payment date or dates on which the receipt thereof would be permissible
      under the laws applicable to the Lender limiting rates of interest which may
      be
      charged or collected by the Lender. Such deferred interest shall not bear
      interest.

    

    Section
      2.3    Promissory
      Note.

    

    The
      Loan
      shall be evidenced by the Promissory Note of the Borrower attached hereto as
      an
      exhibit payable to the order of the lender in the Principal Amount and otherwise
      duly completed.

    

    Section
      2.4    Payment
      of Trust Loan.

    

    The
      Principal Amount of the Loan shall be repaid in accordance with Schedule I
      to
      the Promissory Note on the dates specified therein until fully
      paid.

    

    Section
      2.5    Prepayment.

    

    The
      Borrower shall be entitled to prepay the Loan in whole or in part, at any time
      and from time to time; provided, however, that the Borrower shall give notice
      to
      the Lender of any such prepayment; and provided, further, that any partial
      prepayment of the Loan shall be in an amount not less than $1,000. Any such
      prepayment shall be: (a) permanent and irrevocable; (b) accompanied by all
      accrued interest through the date of such prepayment; (c) made without premium
      or penalty; and (d) applied on the inverse order of the maturity of the
      installment thereof unless the Lender and the Borrower agree to apply such
      prepayments in some other order.

    

    Section
      2.6    Method
      of Payments.

    

    (a)    All
      payments of principal, interest, other charges (including indemnities) and
      other
      amounts payable by the Borrower hereunder shall be made in lawful money of
      the
      United States, in immediately available funds, to the Lender at the address
      specified in or pursuant to this Loan Agreement for notices to the Lender,
      on
      the date on which such payment shall become due. Any such payment made on such
      date but after such time shall, if the amount paid bears interest, and except
      as
      expressly provided to the contrary herein, be deemed to have been made on,
      and
      interest shall continue to accrue and be payable thereon until, the next
      succeeding Business Day. If any payment of principal or interest becomes due
      on
      a day other than a Business Day, such payment may be made on the next succeeding
      Business Day, and when paid, such payment shall include interest to the day
      on
      which payment is in fact made.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    

    

    (b)    Notwithstanding
      anything to the contrary contained in this Loan Agreement or the Promissory
      Note, the Borrower shall not be obligated to make any payment, repayment or
      pre-payment on the Promissory Note if doing so would cause the ESOP to cease
      to
      be an employee stock ownership plan within the meaning of section 4975(e)(7)
      of
      the Code or qualified under section 401(a) of the Code or cause the Borrower
      to
      cease to be a tax exempt trust under section 501(a) of the Code or if such
      act
      or failure to act would cause the Borrower to engage in any “prohibited
      transaction” as such term is defined in the section 4975(c) of the Code and the
      regulations promulgated thereunder which is not exempted by section 4975(c)(2)
      or (d) of the Code and the regulations promulgated thereunder or in section
      406
      of ERISA and the regulations promulgated thereunder which is not exempted by
      section 408(b) of ERISA and the regulations promulgated thereunder; provided,
      however, that in each case, the Borrower, may act or refrain from acting
      pursuant to this section 2.6(b) on the basis of an opinion of counsel. The
      Borrower may consult with counsel, and any opinion of such counsel shall be
      full
      and complete authorization and protection in respect of any action taken or
      suffered or omitted by it hereunder in good faith and in accordance with such
      opinion of counsel. Nothing contained in this section 2.6(b) shall be construed
      as imposing a duty on the Borrower to consult with counsel. Any obligation
      of
      the Borrower to make any payment, repayment or prepayment on the Promissory
      Note
      or refrain from taking any other act hereunder or under the Promissory Note
      which is excused pursuant to this section 2.6(b) shall be considered a binding
      obligation of the Borrower, or both, as the case may be, for the purposes of
      determining whether a Default or Event of Default has occurred hereunder or
      under the Promissory Note and nothing in this section 2.6(b) shall be construed
      as providing a defense to any remedies otherwise available upon a Default or
      an
      Event of Default hereunder (other than the remedy of specific
      performance).

    

    Section
      2.7    Use
      of Proceeds of Loan.

    

    The
      entire proceeds of the Loan shall be used solely for acquiring shares of Common
      Stock, and for no other purpose whatsoever.

    

    Section
      2.8    Security.

    

    (a)    In
      order
      to secure the due payment and performance by the Borrower of all of its
      obligations under this Loan Agreement, simultaneously with the execution and
      delivery of this Loan Agreement by the Borrower, the Borrower
      shall:

    

    
      	 	
              (i)

            	
              pledge
                to the Lender as Collateral (as defined in the Pledge Agreement),
                and
                grant to the Lender a first priority lien on and security interest
                in, the
                Common Stock purchased with the Principal Amount, by the execution
                and
                delivery to the lender of the Pledge Agreement attached hereto as
                an
                exhibit; and

            

    

    

    
      	 	
              (ii)

            	
              execute
                and deliver, or cause to be executed and delivered, such other agreement,
                instruments and documents as the Lender may reasonably require in
                order to
                effect the purposes of the Pledge Agreement and this Loan
                Agreement.

            

    

    

    (b)    The
      Lender shall release from encumbrance under the Pledge Agreement and transfer
      to
      the Borrower, as of the date on which any payment or repayment of the Principal
      Amount is made, a number of shares of Common Stock held as Collateral determined
      pursuant to the applicable provisions of the ESOP.

    

    Section
      2.9    Registration
      of the Promissory Note.

    

    (a)    The
      Lender shall maintain a Register providing for the registration of the Principal
      Amount and any stated interest and of transfer and exchange of the Promissory
      Note. Transfer of the Promissory Note may be effected only by the surrender
      of
      the old instrument and either the reissuance by the Borrower of the old
      instrument to the new holder or the issuance by the Borrower of a new instrument
      to the new holder. The old Promissory Note so surrendered shall be canceled
      by
      the Lender and returned to the Borrower after such cancellation.

    

    (b)    Any
      new
      Promissory Note issued pursuant to section 2.9(a) shall carry the same rights
      to
      interest (unpaid and to accrue) carried by the Promissory Note so transferred
      or
      exchanged so that there will not be any loss or gain of interest on the note
      surrender. Such new Promissory Note shall be subject to all of the provisions
      and entitled to all of the benefits of this Agreement. Prior to due presentment
      for registration or transfer, the Borrower may deem and treat the registered
      holder of any Promissory Note as the holder thereof for purposes of payment
      and
      other purposes. A notation shall be made on each new Promissory Note of the
      amount of all payments of principal and interest theretofore paid.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    ARTICLE
      III

    REPRESENTATIONS
      AND WARRANTIES OF THE BORROWER

    

    The
      Borrower hereby represents and warrants to the Lender as follows:

    

    Section
      3.1    Power,
      Authority, Consents.

    

    The
      Borrower has the power to execute, deliver and perform this Loan Agreement,
      the
      Promissory Note and Pledge Agreement, all of which have been duly authorized
      by
      all necessary and proper corporate or other action.

    

    Section
      3.2    Due
      Execution, Validity, Enforceability.

    

    Each
      of
      the Loan Documents, including, without limitation, this Loan Agreement, the
      Promissory Note and the Pledge Agreement, has been duly executed and delivered
      by the Borrower; and each constitutes the valid and legally binding obligation
      of the Borrower, enforceable in accordance with its terms.

    

    Section
      3.3    Properties,
      Priority of Liens.

    

    The
      liens
      which have been created and granted by the Pledge Agreement constitute valid,
      first liens on the properties and assets covered by the Pledge Agreement,
      subject to no prior or equal lien.

    

    Section
      3.4    No
      Defaults, Compliance with Laws.

    

    The
      Borrower is not in default in any material respect under any agreement,
      ordinance, resolution, decree, bond, note, indenture, order or judgment to
      which
      it is a party or by which it is bound, or any other agreement or other
      instrument by which any of the properties or assets owned by it is materially
      affected.

    

    Section
      3.5    Purchase
      of Common Stock.

    

    Upon
      consummation of any purchase of Common Stock by the Borrower with the proceeds
      of the Loan, the Borrower shall acquire valid, legal and marketable title to
      all
      of the Common Stock so purchased, free and clear of any liens, other than a
      pledge to the Lender of the Common Stock so purchased pursuant to the Pledge
      Agreement. Neither the execution and delivery of the Loan Documents nor the
      performance of any obligation thereunder violates any provisions of law or
      conflicts with or results in a breach of or creates (with or without the giving
      of notice of lapse of time, or both) a default under any agreement to which
      the
      Borrower is a party or by which it is bound or any of its properties is
      affected. No consent of any federal, state, or local governmental authority,
      agency, or other regulatory body, the absence of which could have a materially
      adverse effect on the Borrower or the Trustee, is or was required to be obtained
      in connection with the execution, delivery, or performance of the Loan Documents
      and the transaction contemplated therein or in connection therewith, including
      without limitation, with respect to the transfer of the shares of Common Stock
      purchased with the proceeds of the Loan pursuant thereto.

    

    Section
      3.6    ESOP;
      Contributions.

    

    As
      of the
      effective date of the ESOP sponsor’s mutual holding company reorganization, the
      ESOP and the Borrower will be duly created, organized and maintained by the
      ESOP
      sponsor in compliance with all applicable laws, regulations and rulings. The
      ESOP will qualify as an “employee stock ownership plan” as defined in section
      4975(e)(7) of the Code. The ESOP provides that the ESOP sponsor may make
      contributions to the ESOP in an amount necessary to enable the Trustee to
      amortize the Loan in accordance with the terms of the Promissory Note; provided,
      however, that no such contributions shall be required if they would adversely
      affect the qualification of the ESOP under section 401(a) of the
      Code.

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    

    Section
      3.7    Trustee.

    

    The
      trustee of the ESOP has been duly appointed by the ESOP sponsor. 

    

    Section
      3.8    Compliance
      with Laws; Actions.

    

    Neither
      the execution and delivery by the Borrower of this Loan Agreement or any
      instruments required thereby, nor compliance with the terms and provisions
      of
      any such documents by the lender, constitutes a violation of any provision
      of
      any law or any regulation, order, writ, injunction or decree of any court or
      governmental instrumentality, or an event of default under any agreement, to
      which the Borrower is a party, to which the Borrower is bound or to which the
      Borrower is subject, which violation or event of default would have a material
      adverse effect on the Borrower. There is no action or proceeding pending or
      threatened against either the ESOP or the Borrower before any court or
      administrative agency.

    

    ARTICLE
      IV

    REPRESENTATIONS
      AND WARRANTIES OF THE LENDER

    

    The
      Lender hereby represents and warrants to the Borrower as follows:

    

    Section
      4.1    Power,
      Authority, Consents.

    

    The
      Lender has the power to execute, deliver and perform this Loan Agreement, the
      Pledge Agreement and all documents executed by the Lender in connection with
      the
      Loan, all of which have been duly authorized by all necessary and proper
      corporate or other action. No consent, authorization or approval or other action
      by any governmental authority or regulatory body, and no notice by the Lender
      to, or filing by the Lender with, any governmental authority or regulatory
      body
      is required for the due execution, delivery and performance of this Loan
      Agreement.

    

    Section
      4.2    Due
      Execution, Validity, Enforceability.

    

    This
      Loan
      Agreement and the Pledge Agreement have been duly executed and delivered by
      the
      Lender, and each constitutes a valid and legally binding obligation of the
      Lender, enforceable in accordance with its terms.

    

    ARTICLE
      V

    EVENTS
      OF DEFAULT

    

    Section
      5.1    Events
      of Default under Loan Agreement.

    

    Each
      of
      the following events shall constitute an “Event of Default”
hereunder:

    

    (a)    Failure
      to make any payment or mandatory prepayment of principal of the Promissory
      Note
      when due, or failure to make any payment of interest on the Promissory Note
      not
      later than five (5) Business Days after the date when due.

    

    (b)    Failure
      by the Borrower to perform or observe any term, condition or covenant of this
      Loan Agreement or of any of the other Loan Documents, including, without
      limitation, the Promissory Note and the Pledge Agreement.

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    

    

    (c)    Any
      representation or warranty made in writing to the Lender in any of the Loan
      Documents, or any certificate, statement or report made or delivered in
      compliance with this Loan Agreement, shall have been false or misleading in
      any
      material respect when made or delivered.

    

    Section
      5.2    Lender’s
      Rights upon Event of Default.

    

    If
      an
      Event of Default under this Loan Agreement shall occur and be continuing, the
      Lender shall have no rights to assets of the Borrower other than: (a)
      contributions (other than contributions of Common Stock) that are made by the
      ESOP sponsor to enable the Borrower to meet its obligations pursuant to this
      Loan Agreement and earnings attributable to the investment of such contributions
      and (b) “Eligible Collateral” (as defined in the Pledge Agreement); provided,
      however, that: (i) the value of the Borrower’s assets transferred to the Lender
      following an Event of Default in satisfaction of the due and unpaid amount
      of
      the Loan shall not exceed the amount in default (without regard to amounts
      owing
      solely as a result of any acceleration of the Loan); (ii) the Borrower’s assets
      shall be transferred to the Lender following an Event of Default only to the
      extent of the failure of the Borrower to meet the payment schedule of the Loan;
      and (iii) all rights of the Lender to the Common Stock purchased with the
      proceeds of the Loan covered by the Pledge Agreement following an Event of
      Default shall be governed by the terms of the Pledge Agreement.

    

    ARTICLE
      VI

    MISCELLANEOUS
      PROVISIONS

    

    Section
      6.1    Payments
      Due to the Lender.

    

    If
      any
      amount is payable by the Borrower to the Lender pursuant to any indemnity
      obligation contained herein, then the Borrower shall pay, at the time or times
      provided therefor, any such amount and shall indemnify the Lender against and
      hold it harmless from any loss or damage resulting from or arising out of the
      nonpayment or delay in payment of any such amount. If any amounts as to which
      the Borrower has so indemnified the Lender hereunder shall be assessed or levied
      against the Lender, the Lender may notify the Borrower and make immediate
      payment thereof, together with interest or penalties in connection therewith,
      and shall thereupon be entitled to and shall receive immediate reimbursement
      therefor from the Borrower, together with interest on each such amount as
      provided for in section 2.2(c). Notwithstanding any other provision contained
      in
      this Loan Agreement, the covenants and agreements of the Borrower contained
      in
      this section 6.1 shall survive: (a) payment of the Promissory Note and (b)
      termination of this Loan Agreement.

    

    Section
      6.2    Payments.

    

    All
      payments hereunder and under the Promissory Note shall be made without set-off
      or counterclaim and in such amounts as may be necessary in order that all such
      payments shall not be less than the amounts otherwise specified to be paid
      under
      this Loan Agreement and the Promissory Note, subject to any applicable tax
      withholding requirements. Upon payment in full of the Promissory Note, the
      Lender shall mark such Promissory Note “Paid” and return it to the
      Borrower.

    

    Section
      6.3    Survival.

    

    All
      agreements, representations and warranties made herein shall survive the
      delivery of this Loan Agreement and the Promissory Note.

    

    Section
      6.4    Modifications,
      Consents and Waivers; Entire Agreement.

    

    No
      modification, amendment or waiver of or with respect to any provision of this
      Loan Agreement, the Promissory Note, the Pledge Agreement, or any of the other
      Loan Documents, nor consent to any departure from any of the terms or conditions
      thereof, shall in any event be effective unless it shall be in writing and
      signed by the party against whom enforcement thereof is sought. Any such waiver
      or consent shall be effective only in the specific instance and for the purpose
      for which given. No consent to or demand on a party in any case shall, of
      itself, entitle it to any other or further notice or demand in similar or other
      circumstances. This Loan Agreement embodies the entire agreement and
      understanding between the Lender and the Borrower and supersedes all prior
      agreements and understandings relating to the subject matter
      hereof.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    

    Section
      6.5    Remedies
      Cumulative.

    

    Each
      and
      every right granted to the Lender hereunder or under any other document
      delivered hereunder or in connection herewith, or allowed it by law or equity,
      shall be cumulative and may be exercised from time to time. No failure on the
      part of the Lender or the holder of the Promissory Note to exercise, and no
      delay in exercising, any right shall operate as a waiver thereof, nor shall
      any
      single or partial exercise of any right preclude any other or future exercise
      thereof or the exercise of any other right. The due payment and performance
      of
      the obligations under the Loan Documents shall be without regard to any
      counterclaim, right of offset or any other claim whatsoever which the Borrower
      may have against the Lender and without regard to any other obligation of any
      nature whatsoever which the Lender may have to the Borrower, and no such
      counterclaim or offset shall be asserted by the Borrower in any action, suit
      or
      proceeding instituted by the Lender for payment or performance of such
      obligations.

    

    Section
      6.6    Further
      Assurances; Compliance with Covenants.

    

    At
      any
      time and from time to time, upon the request of the Lender, the Borrower shall
      execute, deliver and acknowledge or cause to be executed, delivered and
      acknowledged, such further documents and instruments and do such other acts
      and
      things as the Lender may reasonably request in order to fully effect the terms
      of this Loan Agreement, the Promissory Note, the Pledge Agreement, the other
      Loan Documents and any other agreements, instruments and documents delivered
      pursuant hereto or in connection with the Loan.

    

    Section
      6.7    Notices.

    

    Except
      as
      otherwise specifically provided for herein, all notices, requests, reports
      and
      other communications pursuant to this Loan Agreement shall be in writing, either
      by letter (delivered by hand or commercial messenger service or sent by
      registered or certified mail, return receipt requested, except for routine
      reports delivered in compliance with Article VI hereof which may be sent by
      ordinary first-class mail) or telex or telecopier addressed as
      follows:

    

    
      
        	
              	(a)	
                If
                  to the Borrower:

              

      

    

    

    
      Delanco
        Federal
        Savings Bank Employee Stock Ownership Plan and Trust

    

    [Trust
      Address]

     

    
      	
            	(b)	
              If
                to the Lender:

            

    

    

    Delanco
      Bancorp, Inc.

    615
      Burlington Avenue

    Delanco,
      New Jersey 08075

    

    Any
      notice, request or communication hereunder shall be deemed to have been given
      on
      the day on which it is delivered by hand or by commercial messenger service,
      or
      sent by telex or telecopier, to such party at its address specified above,
      or,
      if sent by mail, on the third Business Day after the day deposited in the mail,
      postage prepaid, addressed as aforesaid. Any party may change the person or
      address to whom or which notices are to be given hereunder, by notice duly
      given
      hereunder; provided, however, that any such notice shall be deemed to have
      been
      given only when actually received by the party to whom it is
      addressed.

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    
Section
      6.8    Counterparts.

     

    This
      Loan
      Agreement may be signed in any number of counterparts which, when taken
      together, shall constitute one and the same document.

    

    Section
      6.9    Construction;
      Governing Law.

    

    The
      headings used in the table of contents and in this Loan Agreement are for
      convenience only and shall not be deemed to constitute a part hereof. All uses
      herein of any gender or of singular or plural terms shall be deemed to include
      uses of the other genders or plural or singular terms, as the context may
      require. All references in this Loan Agreement of an Article or section shall
      be
      to an Article or section of this Loan Agreement, unless otherwise specified.
      This Loan Agreement, the Promissory Note, the Pledge Agreement and the other
      Loan Documents shall be governed by, and construed and interpreted in accordance
      with, the laws of the State of New Jersey.

    

    Section
      6.10          Severability.

    

    Wherever
      possible, each provision of this Loan Agreement shall be interpreted in such
      manner as to be effective and valid under applicable law; however, the
      provisions of this Loan Agreement are severable, and if any clause or provision
      hereof shall be held invalid or unenforceable in whole or in part in any
      jurisdiction, then such invalidity or unenforceability shall affect only such
      clause or provision, or part thereof, in such jurisdiction and shall not in
      any
      manner affect such clause or provision in any other jurisdiction, or any other
      clause or provisions in this Loan Agreement in any jurisdiction. Each of the
      covenants, agreements and conditions contained in this Loan Agreement are
      independent, and compliance by a party with any of them shall not excuse
      non-compliance by such party with any other. The Borrower shall not take any
      action the effect of which shall constitute a breach or violation of any
      provision of this Loan Agreement.

    

    Section
      6.11          Binding
      Effect: No Assignment or Delegation.

    

    This
      Loan
      Agreement shall be binding upon and inure to the benefit of the Borrower and
      its
      successors and the Lender and its successors and assigns. The rights and
      obligations of the Borrower under this Agreement shall not be assigned or
      delegated without the prior written consent of the Lender, and any purported
      assignment or delegation without such consent shall be void.

    

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, the parties have caused this Loan Agreement to be executed
      as
      of the date first written above.

     

    
      
        	 	 	
                 

                DELANCO
                  FEDERAL SAVINGS BANK

                EMPLOYEE
                  STOCK OWNERSHIP PLAN TRUST

                 

              
	 	 	 
	 	 	 Authorized
                Trust Officer

      

    

    

    

    
      	 	 	
              DELANCO
                BANCORP, INC.

               

            
	 	 	
              By:

            	 
	 	 	 	
              Robert
                M. Notigan

            

    

     

     

     

     

     

    
 

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

     

    
      )

      
 

      ESOP
        PLEDGE AGREEMENT

      

      THIS
        PLEDGE AGREEMENT (“Pledge Agreement”) is made as of the _____ day of
        ______________, 2007, by and between the DELANCO
        FEDERAL SAVINGS BANK EMPLOYEE STOCK OWNERSHIP PLAN TRUST
        (“Pledgor”), and DELANCO
        BANCORP , INC. (“Pledgee”).

      

      W
        I T N E S S E T H

      

      WHEREAS,
        this Pledge Agreement is being executed and delivered to the Pledgee pursuant
        to
        the terms of a Loan Agreement (“Loan Agreement”), by and between the Pledgor and
        the Pledgee;

      

      NOW,
        THEREFORE, in consideration of the mutual agreements contained herein and
        in the
        Loan Agreement, the parties hereto do hereby covenant and agree as
        follows:

      

      Section
        1. Definitions.
        The
        following definitions shall apply for purposes of this Pledge Agreement,
        except
        to the extent that a different meaning is plainly indicated by the context;
        all
        capitalized terms used but not defined herein shall have the respective meanings
        assigned to them in the Loan Agreement:

      

      “Collateral”
        shall
        mean the Pledged Shares and, subject to section 5 hereof, and to the extent
        permitted by applicable law, all rights with respect thereto, and all proceeds
        of such Pledged Shares and rights.

      

      “ESOP”
        shall
        mean the Delanco Federal Savings Bank Employee Stock Ownership
        Plan.

      

      “Event
        of Default”
        shall
        mean an event so defined in the Loan Agreement.

      

      “Liabilities”
        shall
        mean all the obligations of the Pledgor to the Pledgee, howsoever created,
        arising or evidenced, whether direct or indirect, absolute or contingent,
        now or
        hereafter existing, or due or to become due, under the Loan Agreement and
        the
        Promissory Note.

      

      “Pledged
        Shares”
        shall
        mean all the Shares of Common Stock of the Pledgee purchased by the Pledgor
        with
        the proceeds of the loan made by the Pledgee to the Pledgor pursuant to the
        Loan
        Agreement, but excluding any such shares previously released pursuant to
        section
        4.

      

      Section
        2. Pledge.
        To
        secure the payment of and performance of all the Liabilities, the Pledgor
        hereby
        pledges to the Pledgee, and grants to the Pledgee, a security interest in,
        and
        lien upon, the Collateral.

      

      Section
        3. Representations
        and Warranties of the Pledgor.
        The
        Pledgor represents, warrants, and covenants to the Pledgee as
        follows:

      

      (a)    the
        execution, delivery and performance of this Pledge Agreement and the pledging
        of
        the Collateral hereunder do not and will not conflict with, result in a
        violation of, or constitute a default under, any agreement binding upon the
        Pledgor;

      

      (b)    the
        Pledged Shares are and will continue to be owned by the Pledgor free and
        clear
        of any liens or rights of any other person except the lien hereunder and
        under
        the Loan Agreement in favor of the Pledgee, and the security interest of
        the
        Pledgee in the Pledged Shares and the proceeds thereof is and will continue
        to
        be prior to and senior to the rights of all others;

      

      (c)    this
        Pledge Agreement is the legal, valid, binding and enforceable obligation
        of the
        Pledgor in accordance with its terms;

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      (d)    the
        Pledgor shall, from time to time, upon request of the Pledgee, promptly deliver
        to the Pledgee such stock powers, proxies, and similar documents, satisfactory
        in form and substance to the Pledgee, with respect to the Collateral as the
        Pledgee may reasonably request; and

      

      (e)    subject
        to the first sentence of section 4(b), the Pledgor shall not, so long as
        any
        Liabilities are outstanding, sell, assign, exchange, pledge or otherwise
        transfer or encumber any of its rights in and to any of the
        Collateral.

      

      Section
        4. Eligible
        Collateral.

      

      (a)    As
        used
        herein the term “Eligible Collateral” shall mean the amount of Collateral which
        has an aggregate fair market value equal to the amount by which the Pledgor
        is
        in default (without regard to any amounts owing solely as the result of an
        acceleration of the Loan Agreement) or such lesser amount of Collateral as
        may
        be required pursuant to section 13 of this Pledge Agreement.

      

      (b)    The
        Pledged Shares shall be released from this Pledge Agreement in a manner
        conforming to the requirements of Treasury Regulations Section 54.4975-7(b)(8),
        as the same may be from time to time amended or supplemented, and the applicable
        provisions of the ESOP. Subject to such Regulations, the Pledgee may from
        time
        to time, after any Default or Event of Default, and without prior notice
        to the
        Pledgor, transfer all or any part of the Eligible Collateral in the name
        of the
        Pledgee or its nominee, without disclosing that such Eligible Collateral
        is
        subject to any rights of the Pledgor and may from time to time, whether before
        or after any of the Liabilities shall become due and payable, without notice
        to
        the Pledgor, take all or any of the following actions: (i) notify the parties
        obligated on any of the Eligible Collateral to make payment to the Pledgee
        of
        any amounts due or due to become due thereunder, (ii) release or exchange
        all or
        any part of the Eligible Collateral, or compromise or extend or renew for
        any
        period (whether or not longer than the original period) any obligations of
        any
        nature of any party with respect thereto, and (iii) take control of any proceeds
        of the Eligible Collateral.

      

      Section
        5. Delivery.

      

      (a)    The
        Pledgor shall deliver to the Pledgee upon execution of this Pledge Agreement
        (i)
        either (A) certificates for the Pledged Shares, each certificate duly signed
        in
        blank by the Pledgor or accompanied by a stock transfer power duly signed
        in
        blank by the Pledgor and each such certificate accompanied by all required
        documentary or stock transfer tax stamps or (B) if the Trustee does not yet
        have
        possession of the Pledged Shares, an assignment by the Pledgor of all the
        Pledgor’s rights to and interest in the Pledged Shares and (ii) an irrevocable
        proxy, in form and substance satisfactory to the Pledgee, signed by the Pledgor
        with respect to the Pledged Shares.

      

      (b)    So
        long
        as no Default or Event of Default shall have occurred and be continuing,
        (i) the
        Pledgor shall be entitled to exercise any and all voting and other rights
        pertaining to the Collateral or any part thereof for any purpose not
        inconsistent with the terms of this Pledge Agreement, and (ii) the Pledgor
        shall
        be entitled to receive any and all cash dividends or other distributions
        paid in
        respect of the Collateral.

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

      

      Section
        6. Events
        of Default.

      

      (a)    If
        a
        Default or Event of Default shall be existing, in addition to the rights
        it may
        have under the Loan Agreement, the Promissory Note, and this Pledge Agreement,
        or by virtue of any other instrument, (i) the Pledgee may exercise, with
        respect
        to the Eligible Collateral, from time to time, any rights and remedies available
        to it under the Uniform Commercial Code as in effect from time to time in
        the
        State of New Jersey or otherwise available to it and (ii) the Pledgee shall
        have
        the right, for and in the name, place and stead of the Pledgor, to execute
        endorsement, assignments, stock powers and other instruments of conveyance
        or
        transfer with respect to all or any of the Eligible Collateral. Written
        notification of intended disposition of any of the Eligible Collateral shall
        be
        given by the Pledgee to the Pledgor at least three (3) Business Days before
        such
        disposition. Subject to section 13 below, any proceeds of any disposition
        of
        Eligible Collateral may be applied by the Pledgee to the payment of expenses
        in
        connection with the Eligible Collateral, including, without limitation,
        reasonable attorneys’ fees and legal expenses, and any balance of such proceeds
        may be applied by the Pledgee toward the payment of such of the Liabilities
        as
        are in Default, and in such order of application, as the Pledgee may from
        time
        to time elect. No action of the Pledgee permitted hereunder shall impair
        or
        affect its rights in and to the Eligible Collateral. All rights and remedies
        of
        the Pledgee expressed hereunder are in addition to all other rights and remedies
        possessed by it, including, without limitation, those contained in the documents
        referred to in the definition of Liabilities in section 1 hereof.

      

      (b)    In
        any
        sale of any of the Eligible Collateral after a Default or an Event of Default
        shall have occurred, the Pledgee is hereby authorized to comply with any
        limitation or restriction in connection with such sale as it may be advised
        by
        counsel is necessary in order to avoid violation of applicable law (including,
        without limitation, compliance with such procedures as may restrict the number
        of prospective bidders and purchasers or further restrict such prospective
        bidders or purchasers to persons who will represent and agree that they are
        purchasing for their own account for investment and not with a view to the
        distribution or resale of such Eligible Collateral), or in order to obtain
        such
        required approval of the sale or of the purchase by any governmental regulatory
        authority or official, and the Pledgor further agrees that such compliance
        shall
        not result in such sale being considered or deemed not to have been made
        in a
        commercially reasonable manner, nor shall the Pledgee be liable or accountable
        to the Pledgor for any discount allowed by reason of the fact that such Eligible
        Collateral is sold in compliance with any such limitation or
        restriction.

      

      Section
        7. Payment
        in Full.
        Upon the
        payment in full of all outstanding Liabilities, this Pledge Agreement shall
        terminate and the Pledgee shall forthwith assign, transfer and deliver to
        the
        Pledgor, against receipt and without recourse to the Pledgee, all Collateral
        then held by the Pledgee pursuant to the Pledge Agreement.

      

      Section
        8. No
        Waiver.
        No
        failure or delay in the part of the Pledgee in exercising any right or remedy
        hereunder or under any other document which confers or grants any rights
        to the
        Pledgee in respect of the Liabilities shall operate as a waiver thereof nor
        shall any single or partial exercise of any such rights or remedy preclude
        any
        other or further exercise thereof or the exercise of any other right or remedy
        of the Pledgee.

      

      Section
        9. Binding
        Effect; No Assignment or Delegation.
        This
        Pledge Agreement shall be binding upon and inure to the benefit of the Pledgor,
        the Pledgee and their respective successors and assigns, except that the
        Pledgor
        may not assign or transfer its rights hereunder without the prior written
        consent of the Pledgee (which consent shall not unreasonably be withheld).
        Each
        duty or obligation of the Pledgor to the Pledgee pursuant to the provisions
        of
        this Pledge Agreement shall be performed in favor of any person or entity
        designated by the Pledgee, and any duty or obligation of the Pledgee to the
        Pledgor may be performed by any other person or entity designated by the
        Pledgee.

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

      

      Section
        10. Governing
        Law.
        This
        Pledge Agreement shall be governed by and construed in accordance with the
        laws
        of the State of New Jersey applicable to agreements to be performed wholly
        within the State of New Jersey.

      

      Section
        11. Notices.
        All
        notices, requests, instructions or documents hereunder shall be in writing
        and
        delivered personally or sent by United States mail, registered or certified,
        return receipt requested, with proper postage prepaid as follows:

      

      
        	
              	(a)	
                If
                  to the Pledgee:

              

      

      Delanco
        Bancorp, Inc.

      615
        Burlington Avenue

      Delanco,
        New Jersey 08075

       

      
        	
              	(b)	
                If
                  to the Pledgor:

              

      

      Delanco
        Federal Savings Bank

      Employee
        Stock Ownership Plan Trust

      [Trust
        Address]

      

      or
        at
        such other address as either of the parties may designate by written notice
        to
        the other party. If delivered personally, the date on which a notice, request,
        instruction or document is delivered shall be the date on which such delivery
        is
        made, and, if delivered by mail, the date on which such notice, request,
        instruction, or document is deposited in the mail shall be the date of delivery.
        Each notice, request, instruction or document shall bear the date on which
        it is
        delivered.

      

      Section
        12. Interpretation.
        Wherever
        possible, each provision of this Pledge Agreement shall be interpreted in
        such
        manner as to be effective and valid under applicable law, but if any provision
        herein shall be prohibited by or invalid under such law, such provision shall
        be
        ineffective to the extent of such prohibition or invalidity, without
        invalidating the remainder of such provision or the remaining provisions
        hereof.

      

      Section
        13. Construction.
        All
        provisions hereof shall be construed so as to maintain (a) the ESOP as a
        qualified leveraged employee stock ownership plan under sections 401(a) and
        4975(e)(7) of the Internal Revenue Code of 1986 (the “Code”), (b) the Trust as
        exempt from taxation under section 501(a) of the Code and (c) the Trust Loan
        as
        an exempt loan under section 54.4975-7(b) of the Treasury Regulations and
        as
        described in Department of Labor Regulation section 2550.408b-3.

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      IN
        WITNESS WHEREOF, this Pledge Agreement has been duly executed by the parties
        hereto as of the day and year first above written.

      

      

      
        	 	 	 	
                DELANCO
                  FEDERAL SAVINGS BANK EMPLOYEE STOCK OWNERSHIP PLAN
                  TRUST

              
	 	 	 	 
	 	 	
                 

              	 
	 	 	 	
                Authorized
                  Trust Officer

              

      

      

       

      
        	 	 	
                DELANCO
                  BANCORP, INC.

              
	 	 	 	 
	 	 	 	 
	 	 	
                By: 

              	 
	 	 	 	
                Robert
                  M. Notigan

              

      

       

       

       

       

       

       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

      

         

        ESOP
          PROMISSORY NOTE

        

        FOR
          VALUE RECEIVED,
          the
          undersigned, the
          DELANCO
          FEDERAL SAVINGS BANK EMPLOYEE STOCK OWNERSHIP PLAN TRUST
          (the
“Borrower”), hereby promises to pay to the order of DELANCO
          BANCORP, INC. (the
          “Lender”) up to $_________ payable in accordance with the Loan Agreement made
          and entered into between the Borrower and the Lender of even date herewith
          (“Loan Agreement”) pursuant to which this Promissory Note is
          issued.

        

        The
          Principal Amount of this Promissory Note shall be payable in accordance
          with the
          schedule attached hereto (“Schedule I”).

        

        This
          Promissory Note shall bear interest at the rate per annum set forth or
          established under the Loan Agreement, such interest to be payable in accordance
          with Schedule I.

        

        Anything
          herein to the contrary notwithstanding, the obligation of the Borrower
          to make
          payments of interest shall be subject to the limitation that payments of
          interest shall not be required to be made to the Lender to the extent that
          the
          Lender’s receipt thereof would not be permissible under the law or laws
          applicable to the Lender limiting rates of interest which may be charged
          or
          collected by the Lender. Any such payments of interest which are not made
          as a
          result of the limitation referred to in the preceding sentence shall be
          made by
          the Borrower to the Lender on the earliest interest payment date or dates
          on
          which the receipt thereof would be permissible under the laws applicable
          to the
          Lender limiting rates of interest which may be charged or collected by
          the
          Lender. Such deferred interest shall not bear interest.

        

        Payments
          of both principal and interest on this Promissory Note are to be made at
          the
          principal office of the Lender or such other place as the holder hereof
          shall
          designate to the Borrower in writing, in lawful money of the United States
          of
          America in immediately available funds.

        

        Failure
          to make any payments of principal on this Promissory Note when due, or
          failure
          to make any payment of interest on this Promissory Note not later than
          five (5)
          Business Days after the date when due, shall constitute a default hereunder,
          whereupon the principal amount of accrued interest on this Promissory Note
          shall
          immediately become due and payable in accordance with the terms of the
          Loan
          Agreement.

        

        This
          Promissory Note is secured by a Pledge Agreement between the Borrower and
          the
          Lender of even date herewith and is entitled to the benefits
          thereof.

         

        
          
            	 	 	 	
                    DELANCO
                      FEDERAL SAVINGS BANK

                    EMPLOYEE
                      STOCK OWNERSHIP PLAN TRUST

                  
	 	 	
                     

                  	
                     

                     

                  
	 	 	 	
                    Authorized
                      Trust OfficerExhibit 10.4

     

      
        

      

    

    Exhibit
      10.4

     

    FORM
      OF

    DELANCO
      FEDERAL SAVINGS BANK

    EMPLOYEE
      SEVERANCE COMPENSATION PLAN

    

    
      	
              A.

            	
              Purpose.

            

    

    

    The
      primary purpose of the Delanco Federal Savings Bank Employee Severance
      Compensation Plan (the “Plan”) is to ensure the successful continuation of the
      business of Delanco Federal Savings Bank (the “Bank”) and the fair and equitable
      treatment of the Bank’s employees following a Change in Control (as defined
      below). 

    

    
      	B.	
              Covered
                Employees.

            

    

    

    Subject
      to paragraph C below, any employee of the Bank with at least one year of service
      as of his or her termination date shall be eligible to receive a Change in
      Control Severance Benefit (as defined below) if, within the period beginning
      on
      the effective date of a Change in Control and ending on the first anniversary
      of
      such date, (i) the employee’s employment with the Bank is involuntarily
      terminated or (ii) the employee terminates employment with the Bank voluntarily
      after being offered continued employment in a position that is not a Comparable
      Position (as defined below). 

    

    
      	
              C.

            	
              Limitations
                on Eligibility for Change in Control Severance Benefits or Management
                Restructuring Benefits.

            

    

    

    
      	 	
              (1)

            	
              No
                employee shall be eligible for a Change in Control Severance Benefit
                if
                (a) his or her employment is terminated for “Cause,” (b) he or she is
                offered a Comparable Position and declines to accept such position,
                or (c)
                the employee is, at the time of termination of employment, a party
                to an
                individual employment agreement or change in control agreement with
                the
                Bank and/or Delanco Bancorp, Inc. (the “Company).
                

            

    

    

    
      	
            	(2)	
              For
                purposes of this Plan, a termination of employment for “Cause” shall
                include termination because of the employee's personal dishonesty,
                incompetence, willful misconduct, breach of fiduciary duty involving
                personal profit, intentional failure to perform stated duties, willful
                violation of any law, rule, or regulation (other than traffic violations
                or similar offenses) or final cease-and-desist order, or material
                breach
                of any provision of the Plan.

            

    

    

    
      	 	
              (3)

            	
              For
                purposes of this Plan, a “Comparable Position” shall mean a position that
                would (a) provide the employee with base compensation and benefits
                that are comparable in the aggregate to those provided to the employee
                prior to the Change in Control; (b) provide the employee with an
                opportunity for variable bonus compensation that is comparable to
                the
                opportunity provided to the employee prior to the Change in Control;
                (c)
                be in a location that would not require the employee to increase
                his or
                her daily one way commuting distance by more than thirty-five (35)
                miles
                as compared to the employee’s commuting distance immediately prior to the
                Change in Control; and (d) have job skill requirements and duties
                that are
                comparable to the requirements and duties of the position held by
                the
                employee prior to the Change in
                Control.

            

    

     

    
      
        
        

      

      
         

        
          

        

      

      
        
        

      

    

    

    
      	D.	
              Definitions
                of Change in Control.

            

    

    

    For
      purposes of this Plan, “Change in Control” means the occurrence of any one of
      the following events:

    

    
      	 	
              (1)

            	
              Merger:
                The Company merges into or consolidates with another corporation,
                or
                merges another corporation into the Company, and as a result, less
                than a
                majority of the combined voting power of the resulting corporation
                immediately after the merger or consolidation is held by persons
                who were
                stockholders of the Company immediately before the merger or
                consolidation.

            

    

    

    
      	 	
              (2)

            	
              Acquisition
                of Significant Share Ownership:
                A
                report on Schedule 13D or another form or schedule (other than Schedule
                13G) is filed or required to be filed under Sections 13(d) or 14(d)
                of the
                Securities Exchange Act of 1934, if the schedule discloses that the
                filing
                person or persons acting in concert has or have become the beneficial
                owner(s) of 25% or more of a class of the Company’s voting securities, but
                this clause (2) shall not apply to beneficial ownership of Company
                voting
                shares held in a fiduciary capacity by an entity of which the Company
                directly or indirectly beneficially owns 50% or more of its outstanding
                voting securities.

            

    

    

    
      	 	
              (3)

            	
              Change
                in Board Composition:
                During any period of two consecutive years, individuals who constitute
                the
                Company’s Board of Directors at the beginning of the two-year period cease
                for any reason to constitute at least a majority of the Company’s Board of
                Directors; provided, however, that for purposes of this clause (3),
                each
                director who is first elected by the board (or first nominated by
                the
                board for election by the stockholders) by a vote of at least two-thirds
                (2⁄3) of the directors who were directors at the beginning of the two-year
                period shall be deemed to have also been a director at the beginning
                of
                such period; or

            

    

    

    
      	 	
              (4)

            	
              Sale
                of Assets:
                The Company or the Bank sells to a third party all or substantially
                all of
                its assets.

            

    

    

    Notwithstanding
      anything in this Plan to the contrary, in no event shall the conversion of
      the
      Bank’s mutual holding company parent, Delanco MHC, from mutual to stock form,
      i.e., a “second step conversion,” constitute a Change in Control for purposes of
      this Plan.

    

    
      	E.	
              Determination
                of the Change in Control Severance Benefit.

            

    

    

    
      	 	
              (1)

            	
              The
                Change in Control Severance Benefit payable to an eligible employee
                under
                this Plan shall be determined under the following
                schedule:

            

    

    

    
      	 	
              (a)

            	
              An
                eligible employee who does not receive a benefit pursuant to paragraph
                (b)
                of this Section shall receive a Change in Control Severance Benefit
                equal
                to the product of (i) the employee’s years of service from his or her hire
                date (including partial years) through the termination date and (ii)
                an
                amount equal to two (2) weeks of the employee’s Base Compensation (as
                defined below). A “year of service” shall mean each 12-month period of
                service following an employee’s hire date determined without regard the
                number of hours worked during such period(s). The minimum payment
                to an
                eligible employee under this paragraph shall be an amount equal to
                two (2)
                weeks of Base Compensation and the maximum payment to an eligible
                employee
                shall be an amount equal to six (6) months of Base
                Compensation.

            

    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    

    
      	 	
              (b)

            	
              An
                eligible employee who held the title of [Vice
                President]
                or
                higher immediately prior to a Change in Control shall receive a Change
                in
                Control Severance Benefit equal to twelve (12) months of Base
                Compensation. 

            

    

    

    
      	 	
              (c)

            	
              The
                Change in Control Severance Benefit shall be paid in a lump sum not
                later
                than five (5) business days after the date of the employee’s termination
                of employment.

            

    

    

    
      	 	
              (2)

            	
              For
                purpose of determinations under this paragraph E, “Base Compensation”
                shall mean: 

            

    

    

    
      	 	
              (a)

            	
              For
                salaried employees, the employee’s annual base salary at the rate in
                effect on his or her termination date or, if greater, the rate in
                effect
                on the date immediately preceding the Change in
                Control.

            

    

    

    
      	 	
              (b)

            	
              For
                employees whose compensation is determined in whole or in part on
                the
                basis of commission income, the employee’s base salary at termination (or,
                if greater, the employee’s base salary on the date immediately preceding
                the effective date of the Change in Control), if any, plus the commissions
                earned by the employee in the twelve (12) full calendar months preceding
                his or her termination date (or, if greater, the commissions earned
                in the
                twelve (12) full calendar months immediately preceding the effective
                date
                of the Change in Control).

            

    

    

    
      	 	
              (c)

            	
              For
                hourly employees, the employee’s total hourly wages for the twelve (12)
                full calendar months preceding his or her termination date or, if
                greater,
                the twelve (12) full calendar months preceding the effective date
                of the
                Change in Control.

            

    

    

    
      	F.	
              Withholding.

            

    

    

    All
      payments will be subject to customary withholding for federal, state and local
      tax purposes.

    

    
      	G.	
              Parachute
                Payment.

            

    

    

    Notwithstanding
      anything in this Plan to the contrary, if a Change in Control Severance Benefit
      to an employee who is a “Disqualified Individual” shall be in an amount which
      includes an “Excess Parachute Payment,” taking into account payments under this
      Plan and otherwise, the benefit payable under this Plan shall be reduced to
      the
      maximum amount which does not include an Excess Parachute Payment. The terms
      “Disqualified Individual” and “Excess Parachute Payment” shall have the same
      meanings as under Section 280G of the Internal Revenue Code of 1986, as amended,
      or any successor provision thereto.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    

    
      	H.	
              Adoption
                by Affiliates.

            

    

    

    Upon
      approval by the Board of Directors of the Bank (the “Board”), this Plan may be
      adopted by any “Subsidiary” or “Parent” of the Bank. Upon such adoption, the
      provisions of the Plan shall be fully applicable to the employees of that
      Subsidiary or Parent. The term “Subsidiary” means any corporation in which the
      Bank, directly or indirectly, holds a majority of the voting power of its
      outstanding shares of capital stock. The term “Parent” means any corporation
      which holds a majority of the voting power of the Bank’s outstanding shares of
      capital stock.

    

    
      	I.	
              Administration.

            

    

    

    The
      Plan
      is administered by the Board, which shall have the discretion to interpret
      the
      terms of the Plan and to make all determinations about eligibility and payment
      of benefits. All decisions of the Board, any action taken by the Board with
      respect to the Plan and within the powers granted to the Board under the Plan,
      and any interpretation by the Board of any term or condition of the Plan, are
      conclusive and binding on all persons, and will be given the maximum possible
      deference allowed by law. The Board may delegate and reallocate any authority
      and responsibility with respect to the Plan.

    

    
      	J.	
              Source
                of Payments.

            

    

    

    Unless
      otherwise determined by the Board, all payments and benefits provided under
      this
      Agreement shall be paid solely by the Bank. Notwithstanding anything in this
      Agreement to the contrary, no provision of this Agreement shall be construed
      so
      as to result in the duplication of any payment or benefit. 

    

    
      	K.	
              Inalienability.

            

    

    

    In
      no
      event may any Employee sell, transfer, anticipate, assign or otherwise dispose
      of any right or interest under the Plan. At no time will any such right or
      interest be subject to the claims of creditors, nor liable to attachment,
      execution or other legal process.

    

    
      	L.	
              Governing
                Law.

            

    

    

    The
      provisions of the Plan will be construed, administered and enforced in
      accordance with the laws of the State of New Jersey, except to the extent that
      federal law applies.

    

    
      	M.	
              Severability.

            

    

    

    If
      any
      provision of the Plan is held invalid or unenforceable, its invalidity or
      unenforceability will not affect any other provision of the Plan, and the Plan
      will be construed and enforced as if such provision had not been
      included.

    

    
      	N.	
              No
                Employment Rights.

            

    

    

    Neither
      the establishment nor the terms of this Plan shall be held or construed to
      confer upon any employee the right to a continuation of employment by the Bank,
      nor constitute a contract of employment, express or implied. The Bank reserves
      the right to dismiss or otherwise deal with any employee to the same extent
      and
      on the same basis as though this Plan had not been adopted. Nothing in this
      Plan
      is intended to alter the at-will status of the Bank’s employees, it being
      understood that, except to the extent otherwise expressly set forth to the
      contrary in an individual employment-related agreement, the employment of any
      employee may be terminated at any time by either the Bank or the employee with
      or without cause.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    

    
      	O.	
              Amendment
                and Termination.

            

    

    

    The
      Plan
      may be terminated or amended in any respect by resolution adopted by a majority
      of the Board, unless a Change in Control has previously occurred. If a Change
      in
      Control occurs, the Plan no longer shall be subject to amendment, change,
      substitution, deletion, revocation or termination in any respect whatsoever.
      The
      form of any proper amendment or termination of the Plan shall be a written
      instrument signed by a duly authorized officer or officers of the Bank,
      certifying that the amendment or termination has been approved by the Board.
      A
      proper amendment of the Plan automatically shall effect a corresponding
      amendment to each Participant’s rights hereunder. A proper termination of the
      Plan automatically shall effect a termination of all employees’ rights and
      benefits hereunder.

    

    
      	P.	
              Required
                Provisions.

            

    

    

    
      	 	
              (1)

            	
              In
                the event any of the provisions of this Section P are in conflict
                with the
                terms of this Plan, this Section P shall
                prevail.

            

    

    

    
      	 	
              (2)

            	
              The
                Bank’s Board of Directors may terminate an employee’s employment at any
                time, but any termination by the Bank, other than termination for
                Cause,
                shall not prejudice an employee’s right to compensation or other benefits
                under this Plan. An employee shall not have the right to receive
                compensation or other benefits for any period after Termination for
                Cause.

            

    

    

    
      	 	
              (3)

            	
              If
                an employee is suspended from office and/or temporarily prohibited
                from
                participating in the conduct of the Bank’s affairs by a notice served
                under Section 8(e)(3) or 8(g)(1) of the Federal Deposit Insurance
                Act, 12
                U.S.C. §1818(e)(3) or (g)(1); the Bank’s obligations under this Plan shall
                be suspended as of the date of service, unless stayed by appropriate
                proceedings. If the charges in the notice are dismissed, the Bank
                may in
                its discretion: (i) pay the employee all or part of the compensation
                withheld while their contract obligations were suspended; and (ii)
                reinstate (in whole or in part) any of the obligations which were
                suspended.

            

    

    

    
      	 	
              (4)

            	
              If
                an employee is removed and/or permanently prohibited from participating
                in
                the conduct of the Bank’s affairs by an order issued under Section 8(e)(4)
                or 8(g)(1) of the Federal Deposit Insurance Act, 12 U.S.C. §1818(e)(4) or
                (g)(1), all obligations of the Bank under this Plan shall terminate
                as of
                the effective date of the order, but vested rights of the contracting
                parties shall not be affected.

            

    

    

    
      	 	
              (5)

            	
              If
                the Bank is in default as defined in Section 3(x)(1) of the Federal
                Deposit Insurance Act, 12 U.S.C. §1813(x)(1) all obligations under this
                Plan shall terminate as of the date of default, but this paragraph
                shall
                not affect any vested rights of the contracting
                parties.

            

    

    

    
      	 	
              (6)

            	
              All
                obligations under this Plan shall be terminated, except to the extent
                determined that continuation of the Plan is necessary for the continued
                operation of the Bank: (i) by the Director of the Office of Thrift
                Supervision (OTS), or his designee, at the time the Federal Deposit
                Insurance Corpporation (FDIC) enters into an agreement to provide
                assistance to or on behalf of the Bank under the authority contained
                in
                Section 13(c) of the Federal Deposit Insurance Act, 12 U.S.C. §1823(c); or
                (ii) by the Director of the OTS (or his designee) at the time the
                Director
                (or his designee) approves a supervisory merger to resolve problems
                related to the operations of the Bank or when the Bank is determined
                by
                the Director to be in an unsafe or unsound condition. Any rights
                of the
                parties that have already vested, however, shall not be affected
                by such
                action.

            

    

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    

    
      	 	
              (7)

            	
              Any
                payments made to employees pursuant to this Plan, or otherwise, are
                subject to and conditioned upon their compliance with 12 U.S.C. §1828(k)
                and FDIC regulation 12 C.F.R. Part 359, Golden Parachute and
                Indemnification Payments.

            

    

    

    

    This
      plan
      has been approved and adopted by the Board of Directors of the Bank and is
      effective as of __________________, 200_.

    

    

    
      	 	 	
              DELANCO
                FEDERAL SAVINGS BANK

               

            
	
               

              Attest:

            	 	 	
              By: 

            	 
	 	 	 	
              For
                the Entire Board of Directors

            

    

     

    
      
        
        

      

      
        6

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00114-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00114-of-00352.parquet"}]]