Document:

Prepared by MerrillDirect

EXHIBIT 10.18

                                                                                                                                                                                    Execution
Copy 

 

 

 

 

 

ABINGTON SAVINGS BANK

DEFINED CONTRIBUTION SUPPLEMENTAL EXECUTIVE RETIREMENT
AGREEMENT

 

 

 

 

 

                                                                                                                                                                                                                

 

TABLE OF CONTENTS

	PART 1.
  DEFINITIONS	 
	 	 
	 	1.1.
  Beneficiary	 
	 	1.2. Board or Board of
  Directors	 
	 	1.3. Change in Control	 
	 	1.4. Code	 
	 	1.5. Fund	 
	 	1.6.
  Fund Balance	 
	 	1.7.
  Good Reason	 
	 	1.8. Normal Retirement Date	 
	 	1.9.
  Trustee	 
	 	1.10. Vested Benefit	 
	 	1.11. Vested Percentage	 
	 	 	 
	PART
  2. BANK CONTRIBUTIONS TO FUND; PAYMENTS FROM FUND TO EXECUTIVE	 
	 	 
	 	2.1.
  Establishment of and Contributions to the Fund	 
	 	2.2.
  Additional Contributions Upon Change in Control.	 
	 	2.3. Investment of the Fund.	 
	 	2.4. Payments from Fund	 
	 	2.5. No Benefits
  Upon Discharge for Cause	 
	 	2.6. Discharge for Cause.	 
	 	 	 
	PART 3. ADDITIONAL
  PROVISIONS	 
	 	 
	 	3.1. Alternative
  Forms of Benefit Payment	 
	 	3.2. Beneficiary
  Designation Procedure	 
	 	3.3.
  Alienability and Assignment Prohibition	 
	 	3.4.
  Binding Obligation of Bank and any Successor in Interest	 
	 	3.5. Consultation with
  Tax Advisor.	 
	 	3.6.
  Amendment	 
	 	3.7.
  General	 
	 	3.8.
  Headings	 
	 	3.9. Applicable Law	 
	 	3.10. Named
  Fiduciary and Plan Administrator	 
	 	3.11. Claims Procedure	 
	 	3.12.
  Arbitration	 
	 	3.13. Entire Agreement	 
	 	3.14. Interpretation	 
	 	3.15.
  Employment	 
	 	3.16. Communications	 

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

             This Agreement, made and entered
into as of July 26, 2001 by and between Abington Savings Bank, a Bank
organized and existing under the laws of The Commonwealth of Massachusetts (the
“Bank”) and a wholly-owned subsidiary of Abington Bancorp, Inc. (the “Holding
Company”), and Kevin M. Tierney, Sr., a key employee and executive of the Bank
(the “Executive”).  The effective date
of this Agreement shall be July 26, 2001.

WITNESSETH.

             WHEREAS, the Executive is a valuable, key employee of
the Bank, serving the Bank as a senior executive; and

             WHEREAS, because of the Executive’s experience,
knowledge of the affairs of the Bank, and reputation and contacts in the
banking industry, the Bank deems the Executive’s continued employment with the
Bank important for its future growth; and

             WHEREAS, it is the desire of the Bank and in its best
interest that the Executive’s services be retained; and

             WHEREAS, in order to induce the Executive to continue
in the employ of the Bank, the Bank has entered into this Agreement to provide
him or his beneficiaries with certain benefits in accordance with the terms and
conditions hereinafter set forth; and

             WHEREAS, the Bank desires to establish a Fund (as
defined in Section 1.5) and to contribute to the Fund certain assets that
shall be held therein, subject to the terms of this Agreement, until such time
as benefits have been paid to the Executive or his beneficiaries as specified
herein;

             NOW, THEREFORE, in consideration of services performed in the
past and to be performed in the future as well as of the mutual promises and
covenants herein contained, it is agreed as follows:

Part 1. Definitions

             1.1.       Beneficiary shall mean the
person or persons designated by the Executive in accordance with
Section 3.2 hereof to receive benefits under this Agreement after the
death of the Executive.

             1.2.       Board or Board of Directors shall mean the
Board of Directors of the Bank, or, where the context requires, the Board of
Directors of the Holding Company.

             1.3.       Change in Control shall have the
meaning defined in that certain Special Termination Agreement dated as of
November 2, 1998 by and among the Holding Company, the Bank, and the Executive.

             1.4.       Code shall mean the
Internal Revenue Code of 1986, as amended.

             1.5.       Fund shall mean the Fund established by the Bank
pursuant to Section 2.1 with the contributions to be made under this Agreement.

             1.6.       Fund Balance shall be the
aggregate of all contributions made by the Bank to the Fund for the benefit of
the Executive under this Agreement and the investment proceeds of such
contributions.

             1.7.       Good Reason shall mean:

                           (a) A reduction in
the Executive’s annual base salary as in effect on the date hereof; or

                           (b) A significant
diminution in the nature or scope of the Executive’s responsibilities,
authorities, powers, functions or duties; or

                           (c) A material breach
by the Bank of any of the provisions of this Agreement which failure or breach
shall have continued for thirty (30) days after written notice from the
Executive to the Holding Company or the Bank specifying the nature of such
failure or breach.

             1.8.       Normal Retirement Date shall mean the
date on which the Executive attains age sixty-five (65).

             1.9.       Trustee shall mean the trustee to be appointed under that
certain Trust Agreement established by the Bank in connection with this
Agreement.

             1.10.     Vested Benefit shall mean the
amount of the Fund Balance that has become vested as of any particular date in
time and shall be calculated by multiplying (i) the Fund Balance times (ii) the
Vested Percentage.  The Vested Benefit
shall be paid in the manner chosen by the Executive pursuant to Section 3.1.

             1.11.     Vested Percentage shall be zero percent until the “Usual Full Vesting
Date,” which date shall be the later to occur of the date which is (i) two
years from the date of this Agreement or (ii) five years from the date the
Executive commenced employment with the Bank. Thereafter the Vested Percentage
shall be 100%. Notwithstanding the provisions of the first sentence of this
Section 1.11, if any of the following shall occur before the Usual Full Vesting
Date, the Vested Percentage shall become 100%:

                           (a) The Executive
terminates his employment with the Bank for Good Reason; or

                           (b) The Executive
dies; or

                           (c) The Bank terminates
the Executive’s employment without Cause; or

                           (d) A Change in
Control shall have occurred.

Part 2. Bank Contributions to Fund; Payments from Fund to Executive

             2.1.       Establishment of and
Contributions to the Fund.  As of the date of this Agreement the Bank
has established the Fund with the Trustee under the Trust Agreement for the
benefit of the Executive.  As of the
last day of each Calendar Year, if the Executive is employed by the Bank as of
such date, the Bank will contribute to the Fund an amount equal to $[42,000]
(the “Annual Contribution”).  The Bank
will cease to have any further obligation to pay the Annual Contribution upon
the earlier to occur of (i) the Normal Retirement Date or (ii) the date on which
the Executive’s employment terminates for any reason.

             2.2.       Additional Contributions
Upon Change in Control.  Immediately upon a Change in Control, the
Bank shall make an irrevocable contribution to the Fund in an amount that is
equal to three times the amount of the then current Annual Contribution.  Payments made under this Section 2.2 shall
not have any effect on the Bank’s continuing obligation to make Annual
Contributions as provided for in Section 2.1, to the extent that the Executive
remains employed at the end of a calendar year.

             2.3.       Investment of the Fund.  The assets contributed by the Bank to the
Fund will be invested by the Trustee as directed by the Executive pursuant to
the Trust Agreement.  Under the terms of
the Trust, the Executive will have responsibility to make all investment
decisions.  The Executive shall bear all
risk with respect to such investments. 
The Bank will have no liability with respect to results obtained as a
result of such investments.

             2.4.
      Payments
from Fund

                           (a) Termination of Service.  If the Executive terminates service as an
employee with the Bank (other than (i) for Cause (which
is provided for in Section 2.5), (ii) by reason of death (which is provided for
in Section 2.4(b)) or (iii) before the Normal Retirement Date by reason of
disability (which is provided for in Section 2.4(c))), he shall be
entitled to receive the Vested Benefit, with such payment to commence on his
Normal Retirement Date.  If the
termination of employment is before the Normal Retirement Date, the Executive
may commence to receive the Vested Benefit not later than 60 days after the
termination of employment, with the permission of the Board. In the event that
the Executive requests permission to commence receiving his Vested Benefit
before his Normal Retirement Date and the Board refuses to grant permission for
such early commencement of payments, the Executive may request the Board to
reconsider its decision.  If the Board
has not agreed to permit such early payment by a date which is thirty days
after the request for reconsideration was made, the Executive shall have the
right to receive upon written application to the Bank his Vested Benefit, less
a penalty of 7%.

                           (b) Death of the Executive.  Upon the
Executive’s death, the Trustee shall pay to the estate of the Executive (or to
his beneficiary if he shall have designated a beneficiary to receive payments
pursuant to Section 3.2) the then remaining Fund Balance.

                           (c) Disability.

             (1)
In the event that the Executive shall become “disabled” (as defined below)
while in the employ of the Bank and prior to his Normal Retirement Date, the
Bank shall continue to make Annual Contributions until such time as Executive
commences to receive benefits (“Long Term
Disability Date”) under the long term disability plan maintained by
the Bank. From and after the Long Term Disability Date, the Vested Percentage
shall equal 100%.  As of the Long Term
Disability Date the Executive shall be entitled to receive the Fund Balance,
with such payment to commence on his Normal Retirement Date.  With the permission of the Board, the
Executive may commence to receive the Fund Balance not later than 60 days after
the termination of employment. Payments under this Section 2.4(c) shall be
in addition to any payments otherwise payable to the Executive as a result of
disability under any other plans or agreements in effect from time to time.

             (2)
The Executive shall be considered to be “disabled” when he is no longer capable
of performing the material aspects of his employment duties for the Bank as a
result of physical and/or mental impairment. 
The Executive shall be considered to be no longer “disabled” at such
time as he returns to work in a position with responsibilities comparable to
those inherent in the position in which he was employed on the date he became
“disabled.”

             (3)
If the Executive recovers from his disability and returns to the employ of the
Bank, the Bank will resume making Annual Contributions.

             (4)
In the event there is disagreement as to whether the provisions of this
Section 2.4(c) are applicable, the Bank and the Executive (or his personal
representative) each shall select a physician. 
If the physicians are in disagreement, they shall select a third
physician.  A majority opinion of the
three physicians as to disability shall be binding on all the parties
hereto.  The parties agree that the Bank
will, regardless of the outcome of this procedure, reimburse the Executive (or
his surviving spouse or Beneficiary, as the case may be) for the reasonable and
necessary fees and costs directly attributable to such procedure.

             2.5.       No Benefits Upon
Discharge for Cause.  Should the Executive be discharged for Cause
in accordance with the procedures set forth in Section 2.6 at any time
(before or after his Normal Retirement Date), all Benefits under Part 2 of this
Agreement shall be forfeited.  If a
dispute arises as to discharge for “Cause”, such dispute shall be resolved by
arbitration as set forth in Section 3.12 of this Agreement.

             2.6.
      Discharge for Cause.

                           (a) Cause.  The term
“Cause” shall mean the Executive’s deliberate dishonesty with respect to the
Holding Company or the Bank or any subsidiary or affiliate thereof; conviction
of a crime involving moral turpitude; or gross and willful failure to perform
(other than on account of a medically determinable disability which renders the
Executive incapable of performing such services) a substantial portion of the
Executive’s duties and responsibilities as an officer of the Holding Company or
the Bank, which failure continues for more than thirty days after written
notice given to the Executive pursuant to a two-thirds vote of all of the
members of the Board then in office, such vote to set forth in reasonable
detail the nature of such failure.

                           (b) No Limitation on Authority of Board.  As is provided in Section 3.15, nothing
contained in this Agreement (and nothing contained in this Section 2.6)
shall in any way limit the right of the Holding Company or the Bank to
discharge the Executive with or without Cause or to limit the access of the
Executive to the premises or assets of the Bank or the Holding Company.

Part 3. Additional Provisions

             3.1.       Alternative Forms of
Benefit Payment.  The
Executive shall have the right upon becoming subject to the Plan to elect the
form of payment in which his Vested Benefit is to be paid.  The Executive shall designate the form of
payment in which his Vested Benefit is to be paid in writing and shall submit
such writing to the Executive Vice President or Treasurer of the Bank within
[  ] months of the date of this Agreement.
In any Calendar Year prior to the year in which amounts become payable
hereunder, and at least six months prior to the Executive’s termination of
employment, the Executive may change the form of payment he has elected. The
Executive is entitled to receive the Vested Benefit in a lump sum or in monthly
or annual installments payable over a period not to exceed five years.

             3.2.       Beneficiary Designation
Procedure. The Executive may designate one or more
Beneficiaries to receive, upon the Executive’s death, specified percentages of
any benefit payments to be paid hereunder. 
The Executive shall designate any such Beneficiaries in writing and
shall submit such writing to the Executive Vice President or Treasurer of the
Bank.  Only designated Beneficiaries
alive at the Executive’s death shall be entitled to share in the benefit
payments.  If no designated Beneficiary
is alive at the Executive’s death, his surviving spouse shall be entitled to
all benefits payable under this Agreement. 
If the Executive dies leaving neither a designated Beneficiary nor a
surviving spouse, his estate shall be entitled to any benefits payable under
this Agreement.

             3.3.       Alienability and Assignment Prohibition.  Neither the Executive, his surviving spouse
nor any other Beneficiary under this Agreement shall have any power or right to
transfer, assign, anticipate, hypothecate, mortgage, commute, modify or
otherwise encumber in advance any of the benefits payable hereunder nor shall
any of said benefits be subject to seizure for the payment of any debts,
judgments, alimony or separate maintenance owed by the Executive or his
Beneficiary, nor be transferable by operation of law in the event of
bankruptcy, insolvency or otherwise.  In
the event the Executive or any Beneficiary attempts assignment, commutation,
hypothecation, transfer or disposal of the benefits hereunder, the Bank’s
liabilities shall forthwith cease and terminate.

             3.4.       Binding Obligation of Bank and any Successor in Interest.  This Agreement shall bind the Executive and
the Bank, their heirs, successors, personal representatives and assigns. The
Bank expressly agrees that it shall not merge or consolidate into or with
another bank or sell substantially all of its assets to another bank, firm or
person until such bank, firm or person expressly agrees, in writing, to assume
and discharge the duties and obligations of the Bank under this Agreement.

             3.5.       Consultation with Tax Advisor. The Bank has advised the Executive to consult
with a tax advisor to select the form and schedule for receipt of benefits
under this Agreement.  The Executive
acknowledges that the different form and timing choices he may select will
result in differing tax consequences.

             3.6.       Amendment. During the lifetime of the Executive, this
Agreement may be amended only with the mutual written assent of the Executive
and the Bank.

             3.7.       General. The benefits provided by the Bank to the
Executive pursuant to this Agreement are in the nature of a fringe benefit and
shall in no event be construed to affect or limit the Executive’s current or
prospective salary increases, cash bonuses or profit-sharing distributions or
credits or his right to participate in or be covered by any qualified or
non-qualified pension, profit-sharing, group, bonus or other supplemental
compensation or fringe benefit plan.

             3.8.       Headings.  Headings
and subheadings in this Agreement are inserted for reference and convenience
only and shall not be deemed a part of this Agreement.

             3.9.       Applicable Law.  This
Agreement shall be governed by, and construed and enforced in accordance with,
the substantive laws of The Commonwealth of Massachusetts without regard to its
principles of conflicts of laws.

             3.10.     Named Fiduciary and Plan Administrator. The Plan Administrator of this plan shall be
Abington Savings Bank until another administrator is chosen by the Board.  As Plan Administrator, the Bank shall be
responsible for the management, control and administration of the benefits to
be provided under this Agreement.

             3.11.     Claims Procedure.  In the
event a dispute arises over benefits payable under this Agreement and benefits
are not paid to the Executive (or to his estate in the case of the Executive’s
death) and such claimants feel they are entitled to receive such benefits, then
a written claim must be made to the Plan Administrator named above within sixty
(60) days from the date payments are refused. 
The Plan Administrator shall review the written claim and if the claim
is denied, in whole or in part, it shall provide in writing within sixty (60)
days of receipt of such claim its specific reasons for such denial, reference
to the provisions of this Agreement upon which the denial is based and any
additional material or information necessary to perfect the claim. Such written
notice shall further indicate the additional steps to be taken by claimants if
a further review of the claim denial is desired.  A claim shall be deemed to have been denied if the Plan
Administrator fails to take any action within the aforesaid sixty-day period.

             If claimants desire a second review
they shall notify the Plan Administrator in writing within ninety (90) days of
the first claim denial.  Claimants may
review this Agreement or any documents relating thereto and submit any written
issues and comments they may feel appropriate. 
In its sole discretion, the Plan Administrator shall then review the
second claim and provide a written decision within sixty (60) days of receipt
of such claim. This decision shall likewise state the specific reasons for the
decision and shall include reference to specific provisions of this Agreement
upon which the decision is based.

             3.12.     Arbitration. Any
controversy or claim arising out of or relating to the Agreement, or the breach
thereof, or any failure to agree where agreement of the parties is necessary
pursuant hereto, including the determination of the scope of this agreement to
arbitrate, shall be resolved by the following procedures:

                           (a) The parties agree
to submit any dispute to final and binding arbitration administered by the
American Arbitration Association (the “AAA”), pursuant to the Commercial
Arbitration Rules of the AAA as in effect at the time of submission.  The arbitration shall be held in Boston,
Massachusetts before a single neutral, independent, and impartial arbitrator
(the “Arbitrator”).

                           (b)
Unless the parties have agreed upon the selection of the Arbitrator before
then, the AAA shall appoint the Arbitrator within thirty (30) days after the
submission to AAA for binding arbitration. 
The arbitration hearings shall commence within fifteen (15) days after
the selection of the Arbitrator.  Each
party shall be limited to two pre-hearing depositions each lasting no longer
than two (2) hours.  The parties shall
exchange documents to be used at the hearing no later than ten (10) days prior
to the hearing date.  Each party shall
have no longer than three (3) hours to present its position, and the entire
proceedings before the Arbitrator shall be on no more than two (2) hearing days
within a two week period.  The award
shall be made no more than ten (10) days following the close of the
proceeding.  The Arbitrator’s award
shall not include consequential, exemplary, or punitive damages.  The Arbitrator’s award shall be a final and
binding determination of the dispute and shall be fully enforceable in any
court of competent jurisdiction.  Except
in a proceeding to enforce the results of the arbitration, neither party nor
the Arbitrator may disclose the existence, content, or results of any
arbitration hereunder without the prior written consent of both parties.

             3.13.     Entire Agreement.  This
Agreement constitutes the entire agreement between the parties pertaining to
its subject matter and supersedes all prior and contemporaneous agreements,
understandings, negotiations, prior draft agreements, and discussions of the
parties, whether oral or written.

             3.14.     Interpretation.  When a
reference is made in this Agreement to Sections or Exhibits, such reference
shall be to a Section of or Exhibit to this Agreement unless otherwise
indicated.  Unless the context otherwise
requires, throughout this Agreement, references to Sections refer to Sections
of this Agreement. References to Sections include subsections, which are part
of the related Section (e.g., a
section numbered “Section 5.5(a)” would be part of “Section 5.5” and references
to “Section 5.5” would also refer to material contained in the subsection
described as “Section 5.5(a)”). The recitals hereto constitute an integral part
of this Agreement.  The headings
contained in this Agreement are for reference purposes only and shall not
affect in any way the meaning or interpretation of this Agreement.  Whenever the words “include”, “includes” or
“including” are used in this Agreement, they shall be deemed to be followed by
the words “without limitation”.  The
phrases “the date of this Agreement”, “the date hereof” and terms of similar
import, unless the context otherwise requires, shall be deemed to refer to the
date set forth in the Preamble to this Agreement.

             3.15.     Employment. No provision
of this Agreement shall be deemed to restrict or limit any existing employment
agreement by and between the Holding Company or the Bank and the Executive, nor
shall any conditions herein create specific employment rights to the Executive
nor limit the right of the Holding Company or the Bank to discharge the
Executive with or without Cause.  In a
similar fashion, no provision shall limit the Executive’s rights to voluntarily
terminate his employment at any time.

             3.16.     Communications.  All notices
and other communications hereunder shall be in writing and shall be given by
hand, sent by facsimile transmission with confirmation of receipt requested,
sent via a reputable overnight courier service with confirmation of receipt
requested, or mailed by registered or certified mail (postage prepaid and
return receipt requested) to the parties at the their respective addresses set
forth below (or at such other address for a party as shall be specified by like
notice), and shall be deemed given on the date on which delivered by hand or
otherwise on the date of receipt as confirmed:

                                        To
the Bank or Holding Company:

                                                     Abington
Savings Bank

                                                     536
Washington Street

                                                     Abington,
Massachusetts 02351

                                                     Attention:
Treasurer

                                        To
the Executive:

                                                     Kevin
M. Tierney, Sr.

                                                     12
Hussey Avenue

                                                     Danvers,
Massachusetts 01923

             IN WITNESS WHEREOF, the parties have executed this
Agreement as an instrument under seal, as of the date first written above.

	 	 	 	 	ABINGTON
  SAVINGS BANK
	 	 	 	 	 
	/S/Lewis J. Paragona	 	By:	Vice President/Clerk
	

	 	 	

	Witness	 	 	Title
	 	 	 	 	 
	 	 	 	 	EXECUTIVE
	 	 	 	 	 
	 	 	 	By  	 /S/Kevin M. Tierney, Sr.
	 	 	 	 	

	 	 	 	 	Kevin M. Tierney,
  Sr.
	 	 	 	 	 
	The undersigned
  hereby guarantees the	 	 	 
	obligations of
  Abington Savings Bank	 	 	 
	under the foregoing
  agreement	 	 	 
	 	 	 	 	 
	ABINGTON
  BANCORP, INC.	 	 	 
	 	 	 	 	 
	By:	James P. McDonough	 	 	 
	 	

	 	 	 
	Title:	President & Chief Executive Officer	 	 	 
	 	

	 	 	 
	 	 	 	 	 
	[Seal]Prepared by MerrillDirect

EXHIBIT 10.19

                                                                                                                                                                                    Execution
Copy 

 

 

 

 

 

ABINGTON SAVINGS BANK

DEFINED CONTRIBUTION SUPPLEMENTAL EXECUTIVE RETIREMENT
AGREEMENT

 

 

 

 

 

                                                                                                                                                                                                                

 

Table of Contents

	PART 1. DEFINITIONS	 
	 	 
	 	1.1.
  Beneficiary	 
	 	1.2. Board or Board of
  Directors	 
	 	1.3. Change in Control	 
	 	1.4. Code	 
	 	1.5. Fund	 
	 	1.6.
  Fund Balance	 
	 	1.7.
  Good Reason	 
	 	1.8. Normal Retirement Date	 
	 	1.9.
  Trustee	 
	 	1.10. Vested Benefit	 
	 	1.11. Vested Percentage	 
	 	 	 
	PART
  2. BANK CONTRIBUTIONS TO FUND; PAYMENTS FROM FUND TO EXECUTIVE	 
	 	 
	 	2.1.
  Establishment of and Contributions to the Fund	 
	 	2.2.
  Additional Contributions Upon Change in Control.	 
	 	2.3. Investment of the Fund.	 
	 	2.4. Payments from Fund	 
	 	2.5. No Benefits
  Upon Discharge for Cause	 
	 	2.6. Discharge for Cause.	 
	 	 	 
	PART 3. ADDITIONAL
  PROVISIONS	 
	 	 
	 	3.1. Alternative
  Forms of Benefit Payment	 
	 	3.2. Beneficiary
  Designation Procedure	 
	 	3.3.
  Alienability and Assignment Prohibition	 
	 	3.4.
  Binding Obligation of Bank and any Successor in Interest	 
	 	3.5. Consultation with
  Tax Advisor.	 
	 	3.6.
  Amendment	 
	 	3.7.
  General	 
	 	3.8.
  Headings	 
	 	3.9. Applicable Law	 
	 	3.10. Named
  Fiduciary and Plan Administrator	 
	 	3.11. Claims Procedure	 
	 	3.12.
  Arbitration	 
	 	3.13. Entire Agreement	 
	 	3.14. Interpretation	 
	 	3.15.
  Employment	 
	 	3.16. Communications	 

SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT

             This Agreement, made and entered
into as of July 26, 2001 by and between Abington Savings Bank, a Bank
organized and existing under the laws of The Commonwealth of Massachusetts (the
“Bank”) and a wholly-owned subsidiary of Abington Bancorp, Inc. (the “Holding
Company”), and Robert M. Lallo, a key employee and executive of the Bank (the
“Executive”).  The effective date of
this Agreement shall be July 26, 2001.

WITNESSETH.

             WHEREAS, the Executive is a valuable, key employee of the
Bank, serving the Bank as a senior executive; and

             WHEREAS, because of the Executive’s experience,
knowledge of the affairs of the Bank, and reputation and contacts in the
banking industry, the Bank deems the Executive’s continued employment with the
Bank important for its future growth; and

             WHEREAS, it is the desire of the Bank and in its best
interest that the Executive’s services be retained; and

             WHEREAS, in order to induce the Executive to continue
in the employ of the Bank, the Bank has entered into this Agreement to provide
him or his beneficiaries with certain benefits in accordance with the terms and
conditions hereinafter set forth; and

             WHEREAS, the Bank desires to establish a Fund (as
defined in Section 1.5) and to contribute to the Fund certain assets that
shall be held therein, subject to the terms of this Agreement, until such time
as benefits have been paid to the Executive or his beneficiaries as specified
herein;

             NOW, THEREFORE, in consideration of services performed in the
past and to be performed in the future as well as of the mutual promises and
covenants herein contained, it is agreed as follows:

Part 1. Definitions

             1.1.       Beneficiary shall mean the
person or persons designated by the Executive in accordance with
Section 3.2 hereof to receive benefits under this Agreement after the
death of the Executive.

             1.2.       Board or Board of Directors shall mean the
Board of Directors of the Bank, or, where the context requires, the Board of
Directors of the Holding Company.

             1.3.       Change in Control shall have the
meaning defined in that certain Special Termination Agreement dated as of July
1, 1997 by and among the Holding Company, the Bank, and the Executive.

             1.4.       Code shall mean the
Internal Revenue Code of 1986, as amended.

             1.5.       Fund shall mean the Fund established by the Bank
pursuant to Section 2.1 with the contributions to be made under this Agreement.

             1.6.       Fund Balance shall be the
aggregate of all contributions made by the Bank to the Fund for the benefit of
the Executive under this Agreement and the investment proceeds of such
contributions.

             1.7.       Good Reason shall mean:

                           (a) A reduction in
the Executive’s annual base salary as in effect on the date hereof; or

                           (b) A significant
diminution in the nature or scope of the Executive’s responsibilities,
authorities, powers, functions or duties; or

                           (c) A material breach
by the Bank of any of the provisions of this Agreement which failure or breach
shall have continued for thirty (30) days after written notice from the
Executive to the Holding Company or the Bank specifying the nature of such
failure or breach.

             1.8.       Normal Retirement Date shall mean the
date on which the Executive attains age sixty-five (65).

             1.9.       Trustee shall mean the trustee to be appointed under that
certain Trust Agreement established by the Bank in connection with this
Agreement.

             1.10.     Vested Benefit shall mean the
amount of the Fund Balance that has become vested as of any particular date in
time and shall be calculated by multiplying (i) the Fund Balance times (ii) the
Vested Percentage.  The Vested Benefit
shall be paid in the manner chosen by the Executive pursuant to Section 3.1.

             1.11.     Vested Percentage shall be zero percent until the “Usual Full Vesting
Date,” which date shall be the later to occur of the date which is (i) two
years from the date of this Agreement or (ii) five years from the date the
Executive commenced employment with the Bank. Thereafter the Vested Percentage
shall be 100%. Notwithstanding the provisions of the first sentence of this
Section 1.11, if any of the following shall occur before the Usual Full Vesting
Date, the Vested Percentage shall become 100%:

                           (a) The Executive
terminates his employment with the Bank for Good Reason; or

                           (b) The Executive
dies; or

                           (c) The Bank
terminates the Executive’s employment without Cause; or

                           (d) A Change in
Control shall have occurred.

Part 2. Bank Contributions to Fund; Payments from Fund to Executive

             2.1.       Establishment of and
Contributions to the Fund.  As of the date of this Agreement the Bank has
established the Fund with the Trustee under the Trust Agreement for the benefit
of the Executive.  As of the last day of
each Calendar Year, if the Executive is employed by the Bank as of such date,
the Bank will contribute to the Fund an amount equal to $[15,000] (the “Annual Contribution”).  The Bank will cease to have any further
obligation to pay the Annual Contribution upon the earlier to occur of (i) the
Normal Retirement Date or (ii) the date on which the Executive’s employment
terminates for any reason.

             2.2.       Additional Contributions
Upon Change in Control.  Immediately upon a Change in Control, the
Bank shall make an irrevocable contribution to the Fund in an amount that is
equal to three times the amount of the then current Annual Contribution.  Payments made under this Section 2.2 shall
not have any effect on the Bank’s continuing obligation to make Annual
Contributions as provided for in Section 2.1, to the extent that the Executive
remains employed at the end of a calendar year.

             2.3.       Investment of the Fund.  The assets contributed by the Bank to the Fund
will be invested by the Trustee as directed by the Executive pursuant to the
Trust Agreement.  Under the terms of the
Trust, the Executive will have responsibility to make all investment decisions.  The Executive shall bear all risk with
respect to such investments.  The Bank
will have no liability with respect to results obtained as a result of such
investments.

             2.4.
      Payments
from Fund

                           (a) Termination of Service.  If the Executive terminates service as an
employee with the Bank (other than (i) for Cause (which
is provided for in Section 2.5), (ii) by reason of death (which is provided for
in Section 2.4(b)) or (iii) before the Normal Retirement Date by reason of
disability (which is provided for in Section 2.4(c))), he shall be
entitled to receive the Vested Benefit, with such payment to commence on his
Normal Retirement Date.  If the
termination of employment is before the Normal Retirement Date, the Executive
may commence to receive the Vested Benefit not later than 60 days after the
termination of employment, with the permission of the Board. In the event that
the Executive requests permission to commence receiving his Vested Benefit
before his Normal Retirement Date and the Board refuses to grant permission for
such early commencement of payments, the Executive may request the Board to
reconsider its decision.  If the Board
has not agreed to permit such early payment by a date which is thirty days after
the request for reconsideration was made, the Executive shall have the right to
receive upon written application to the Bank his Vested Benefit, less a penalty
of 7%.

                           (b) Death of the Executive.  Upon the
Executive’s death, the Trustee shall pay to the estate of the Executive (or to
his beneficiary if he shall have designated a beneficiary to receive payments
pursuant to Section 3.2) the then remaining Fund Balance.

                           (c) Disability.

             (1)
In the event that the Executive shall become “disabled” (as defined below)
while in the employ of the Bank and prior to his Normal Retirement Date, the
Bank shall continue to make Annual Contributions until such time as Executive
commences to receive benefits (“Long Term
Disability Date”) under the long term disability plan maintained by
the Bank. From and after the Long Term Disability Date, the Vested Percentage
shall equal 100%.  As of the Long Term
Disability Date the Executive shall be entitled to receive the Fund Balance,
with such payment to commence on his Normal Retirement Date.  With the permission of the Board, the
Executive may commence to receive the Fund Balance not later than 60 days after
the termination of employment. Payments under this Section 2.4(c) shall be
in addition to any payments otherwise payable to the Executive as a result of
disability under any other plans or agreements in effect from time to time.

             (2)
The Executive shall be considered to be “disabled” when he is no longer capable
of performing the material aspects of his employment duties for the Bank as a
result of physical and/or mental impairment. 
The Executive shall be considered to be no longer “disabled” at such
time as he returns to work in a position with responsibilities comparable to
those inherent in the position in which he was employed on the date he became
“disabled.”

             (3)
If the Executive recovers from his disability and returns to the employ of the
Bank, the Bank will resume making Annual Contributions.

             (4)
In the event there is disagreement as to whether the provisions of this
Section 2.4(c) are applicable, the Bank and the Executive (or his personal
representative) each shall select a physician. 
If the physicians are in disagreement, they shall select a third
physician.  A majority opinion of the
three physicians as to disability shall be binding on all the parties
hereto.  The parties agree that the Bank
will, regardless of the outcome of this procedure, reimburse the Executive (or
his surviving spouse or Beneficiary, as the case may be) for the reasonable and
necessary fees and costs directly attributable to such procedure.

             2.5.       No Benefits Upon
Discharge for Cause. Should the Executive be discharged for Cause
in accordance with the procedures set forth in Section 2.6 at any time
(before or after his Normal Retirement Date), all Benefits under Part 2 of this
Agreement shall be forfeited.  If a
dispute arises as to discharge for “Cause”, such dispute shall be resolved by
arbitration as set forth in Section 3.12 of this Agreement.

             2.6.
      Discharge for Cause.

                           (a) Cause.  The term
“Cause” shall mean the Executive’s deliberate dishonesty with respect to the
Holding Company or the Bank or any subsidiary or affiliate thereof; conviction
of a crime involving moral turpitude; or gross and willful failure to perform (other than on account of a medically
determinable disability which renders the Executive incapable of performing
such services) a substantial portion of the Executive’s duties and
responsibilities as an officer of the Holding Company or the Bank, which
failure continues for more than thirty days after written notice given to the
Executive pursuant to a two-thirds vote of all of the members of the Board then
in office, such vote to set forth in reasonable detail the nature of such
failure.

                           (b) No Limitation on Authority of Board.  As is provided in Section 3.15, nothing
contained in this Agreement (and nothing contained in this Section 2.6)
shall in any way limit the right of the Holding Company or the Bank to
discharge the Executive with or without Cause or to limit the access of the
Executive to the premises or assets of the Bank or the Holding Company.

Part 3. Additional Provisions

             3.1.       Alternative Forms of
Benefit Payment. The Executive shall have the right upon
becoming subject to the Plan to elect the form of payment in which his Vested
Benefit is to be paid.  The Executive
shall designate the form of payment in which his Vested Benefit is to be paid
in writing and shall submit such writing to the Executive Vice President or
Treasurer of the Bank within [  ] months
of the date of this Agreement. In any Calendar Year prior to the year in which
amounts become payable hereunder, and at least six months prior to the
Executive’s termination of employment, the Executive may change the form of
payment he has elected. The Executive is entitled to receive the Vested Benefit
in a lump sum or in monthly or annual installments payable over a period not to
exceed five years.

             3.2.       Beneficiary Designation
Procedure. The Executive may designate one or more
Beneficiaries to receive, upon the Executive’s death, specified percentages of
any benefit payments to be paid hereunder. 
The Executive shall designate any such Beneficiaries in writing and
shall submit such writing to the Executive Vice President or Treasurer of the
Bank.  Only designated Beneficiaries
alive at the Executive’s death shall be entitled to share in the benefit
payments.  If no designated Beneficiary
is alive at the Executive’s death, his surviving spouse shall be entitled to
all benefits payable under this Agreement. 
If the Executive dies leaving neither a designated Beneficiary nor a
surviving spouse, his estate shall be entitled to any benefits payable under
this Agreement.

             3.3.       Alienability and Assignment Prohibition.  Neither the Executive, his surviving spouse
nor any other Beneficiary under this Agreement shall have any power or right to
transfer, assign, anticipate, hypothecate, mortgage, commute, modify or
otherwise encumber in advance any of the benefits payable hereunder nor shall
any of said benefits be subject to seizure for the payment of any debts,
judgments, alimony or separate maintenance owed by the Executive or his
Beneficiary, nor be transferable by operation of law in the event of
bankruptcy, insolvency or otherwise.  In
the event the Executive or any Beneficiary attempts assignment, commutation,
hypothecation, transfer or disposal of the benefits hereunder, the Bank’s
liabilities shall forthwith cease and terminate.

             3.4.       Binding Obligation of Bank and any Successor in Interest.  This Agreement shall bind the Executive and
the Bank, their heirs, successors, personal representatives and assigns. The
Bank expressly agrees that it shall not merge or consolidate into or with
another bank or sell substantially all of its assets to another bank, firm or
person until such bank, firm or person expressly agrees, in writing, to assume
and discharge the duties and obligations of the Bank under this Agreement.

             3.5.       Consultation with Tax
Advisor.  The Bank has advised the Executive to
consult with a tax advisor to select the form and schedule for receipt of
benefits under this Agreement.  The
Executive acknowledges that the different form and timing choices he may select
will result in differing tax consequences.

             3.6.       Amendment.  During the
lifetime of the Executive, this Agreement may be amended only with the mutual
written assent of the Executive and the Bank.

             3.7.       General.  The
benefits provided by the Bank to the Executive pursuant to this Agreement are
in the nature of a fringe benefit and shall in no event be construed to affect
or limit the Executive’s current or prospective salary increases, cash bonuses
or profit-sharing distributions or credits or his right to participate in or be
covered by any qualified or non-qualified pension, profit-sharing, group, bonus
or other supplemental compensation or fringe benefit plan.

             3.8.       Headings.  Headings
and subheadings in this Agreement are inserted for reference and convenience
only and shall not be deemed a part of this Agreement.

             3.9.       Applicable Law.  This
Agreement shall be governed by, and construed and enforced in accordance with,
the substantive laws of The Commonwealth of Massachusetts without regard to its
principles of conflicts of laws.

             3.10.     Named Fiduciary and Plan Administrator.  The Plan Administrator of this plan shall be
Abington Savings Bank until another administrator is chosen by the Board.  As Plan Administrator, the Bank shall be
responsible for the management, control and administration of the benefits to
be provided under this Agreement.

             3.11.     Claims Procedure.  In the
event a dispute arises over benefits payable under this Agreement and benefits
are not paid to the Executive (or to his estate in the case of the Executive’s
death) and such claimants feel they are entitled to receive such benefits, then
a written claim must be made to the Plan Administrator named above within sixty
(60) days from the date payments are refused. 
The Plan Administrator shall review the written claim and if the claim
is denied, in whole or in part, it shall provide in writing within sixty (60)
days of receipt of such claim its specific reasons for such denial, reference
to the provisions of this Agreement upon which the denial is based and any
additional material or information necessary to perfect the claim. Such written
notice shall further indicate the additional steps to be taken by claimants if
a further review of the claim denial is desired.  A claim shall be deemed to have been denied if the Plan
Administrator fails to take any action within the aforesaid sixty-day period.

             If claimants desire a second review
they shall notify the Plan Administrator in writing within ninety (90) days of
the first claim denial.  Claimants may
review this Agreement or any documents relating thereto and submit any written
issues and comments they may feel appropriate. 
In its sole discretion, the Plan Administrator shall then review the
second claim and provide a written decision within sixty (60) days of receipt
of such claim. This decision shall likewise state the specific reasons for the
decision and shall include reference to specific provisions of this Agreement
upon which the decision is based.

             3.12.     Arbitration.  Any controversy or claim arising out of or
relating to the Agreement, or the breach thereof, or any failure to agree where
agreement of the parties is necessary pursuant hereto, including the
determination of the scope of this agreement to arbitrate, shall be resolved by
the following procedures:

                           (a) The parties agree
to submit any dispute to final and binding arbitration administered by the
American Arbitration Association (the “AAA”), pursuant to the Commercial
Arbitration Rules of the AAA as in effect at the time of submission.  The arbitration shall be held in Boston,
Massachusetts before a single neutral, independent, and impartial arbitrator
(the “Arbitrator”).

                           (b) Unless the
parties have agreed upon the selection of the Arbitrator before then, the AAA
shall appoint the Arbitrator within thirty (30) days after the submission to
AAA for binding arbitration.  The
arbitration hearings shall commence within fifteen (15) days after the
selection of the Arbitrator.  Each party
shall be limited to two pre-hearing depositions each lasting no longer than two
(2) hours.  The parties shall exchange
documents to be used at the hearing no later than ten (10) days prior to the
hearing date.  Each party shall have no
longer than three (3) hours to present its position, and the entire proceedings
before the Arbitrator shall be on no more than two (2) hearing days within a
two week period.  The award shall be
made no more than ten (10) days following the close of the proceeding.  The Arbitrator’s award shall not include
consequential, exemplary, or punitive damages. 
The Arbitrator’s award shall be a final and binding determination of the
dispute and shall be fully enforceable in any court of competent
jurisdiction.  Except in a proceeding to
enforce the results of the arbitration, neither party nor the Arbitrator may
disclose the existence, content, or results of any arbitration hereunder
without the prior written consent of both parties.

             3.13.     Entire Agreement.  This
Agreement constitutes the entire agreement between the parties pertaining to
its subject matter and supersedes all prior and contemporaneous agreements,
understandings, negotiations, prior draft agreements, and discussions of the
parties, whether oral or written.

             3.14.     Interpretation.  When a
reference is made in this Agreement to Sections or Exhibits, such reference
shall be to a Section of or Exhibit to this Agreement unless otherwise indicated.  Unless the context otherwise requires,
throughout this Agreement, references to Sections refer to Sections of this
Agreement. References to Sections include subsections, which are part of the
related Section (e.g., a section
numbered “Section 5.5(a)” would be part of “Section 5.5” and references to
“Section 5.5” would also refer to material contained in the subsection
described as “Section 5.5(a)”). The recitals hereto constitute an integral part
of this Agreement.  The headings
contained in this Agreement are for reference purposes only and shall not
affect in any way the meaning or interpretation of this Agreement.  Whenever the words “include”, “includes” or
“including” are used in this Agreement, they shall be deemed to be followed by
the words “without limitation”.  The
phrases “the date of this Agreement”, “the date hereof” and terms of similar
import, unless the context otherwise requires, shall be deemed to refer to the
date set forth in the Preamble to this Agreement.

             3.15.     Employment. No provision
of this Agreement shall be deemed to restrict or limit any existing employment
agreement by and between the Holding Company or the Bank and the Executive, nor
shall any conditions herein create specific employment rights to the Executive
nor limit the right of the Holding Company or the Bank to discharge the
Executive with or without Cause.  In a
similar fashion, no provision shall limit the Executive’s rights to voluntarily
terminate his employment at any time.

             3.16.     Communications.  All notices
and other communications hereunder shall be in writing and shall be given by
hand, sent by facsimile transmission with confirmation of receipt requested,
sent via a reputable overnight courier service with confirmation of receipt
requested, or mailed by registered or certified mail (postage prepaid and
return receipt requested) to the parties at the their respective addresses set
forth below (or at such other address for a party as shall be specified by like
notice), and shall be deemed given on the date on which delivered by hand or
otherwise on the date of receipt as confirmed:

                                        To
the Bank or Holding Company:

                                                     Abington
Savings Bank

                                                     536
Washington Street

                                                     Abington,
Massachusetts 0235

                                                     Attention:
Treasurer

                                        To
the Executive:

                                                     Robert
M. Lallo

                                                     81
Bayberry Lane

                                                     Holliston,
Massachusetts 01746

             IN WITNESS WHEREOF, the parties have executed this Agreement
as an instrument under seal, as of the date first written above.

	 	 	 	 	ABINGTON
  SAVINGS BANK
	 	 	 	 	 
	/S/Lewis J. Paragona	 	By:	Vice President/Clerk
	

	 	 	

	Witness	 	 	Title
	 	 	 	 	 
	 	 	 	 	EXECUTIVE
	 	 	 	 	 
	 	 	 	By 	/S/Robert M. Lallo
	 	 	 	 	

	 	 	 	 	Robert M. Lallo
	 	 	 	 	 
	The undersigned
  hereby guarantees the 

  obligations of Abington Savings Bank	 	 	 
	under the foregoing
  agreement	 	 	 
	 	 	 	 	 
	ABINGTON
  BANCORP, INC.	 	 	 
	 	 	 	 	 
	By:	James P. McDonough	 	 	 
	 	

	 	 	 
	Title:	President & Chief Executive Officer	 	 	 
	 	

	 	 	 
	 	 	 	 	 
	[Seal]

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