Document:

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                           COATING SERVICES AGREEMENT

         THIS AGREEMENT, entered into as of the ___ day of April, 2001, by and
between Hydromer, Inc., having its principal place of business at 35 Industrial
Parkway, Branchburg, New Jersey 08876 (hereinafter referred to as "Supplier"),
and Tyco Healthcare Group LP, a Delaware limited partnership having a place of
business at 15 Hampshire Street, Mansfield, Massachusetts 02048 (hereinafter
referred to as "Purchaser").

         WHEREAS, Supplier manufactures certain proprietary primer and coating
         solutions;

         WHEREAS, Purchaser manufacturers, markets and sells certain silicone
         Foley catheters;

         WHEREAS, Supplier and Purchaser are parties to a License Agreement,
dated as of November 30, 1983 (as amended, the "Coating License Agreement"),
pursuant to which Supplier has licensed to Purchaser the right to make, use and
sell certain products coated with Supplier's proprietary hydrophilic coating,
including Purchaser's silicone Foley catheters;

         WHEREAS, Supplier and Purchaser are parties to a Know-How License
Agreement, dated as of April ___, 2001 (the "Primer License Agreement"),
pursuant to which Supplier has licensed to Purchaser the right to use certain
know-how of Supplier related to its proprietary primer in connection with
certain of Purchaser's products, including its silicone Foley catheters;

         WHEREAS, Purchaser desires to have Supplier perform certain services
related to the application of Supplier's proprietary primer and coating to
Purchaser's silicone Foley catheters, and Supplier desires to perform such
services, in accordance with the terms and conditions of this Agreement.

         NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the parties mutually agree as follows:

1.       DEFINITION OF TERMS

         1.1 "Coatings" shall mean (i) Supplier's proprietary hydrophilic
coating solution (the "Hydrophilic Coating"), and (ii) Supplier's proprietary
primer solution used to allow the Hydrophilic Coating to be attached to silicone
polymer surfaces (the "Primer"), in each case manufactured in accordance with
the relevant Coating Specifications with the addition of Purchaser's silver
compound.

         1.2 "Coating Specifications" shall mean (i) with respect to the
         Hydrophilic Coating, the manufacturing and quality assurance
         specifications attached hereto as EXHIBIT A, and (ii) with respect to
         the Primer, the Supplier's manufacturing and quality assurance
         specifications therefor, as set forth ______________________

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         1.3 "Products" shall mean silicone Foley catheters manufactured or
distributed by Purchaser used for urinary drainage.

         1.4 "Services" shall mean Supplier's addition of Purchaser's
proprietary anti-microbial compound into the Coatings, the application of such
Coatings onto the Products, and the packaging of such coated Products, all in
accordance with the Service Specifications.

         1.5 "Service Specifications" shall mean the processing, quality
assurance and packaging specifications for the Services, as mutually agreed upon
by the parties pursuant to Section 3.2 below.

         1.6 "Term" shall mean the duration of this Agreement as set forth in
Section 2 below.

2.       TERM OF AGREEMENT

         2.1 Unless earlier terminated pursuant to the terms herein, the initial
term of this Agreement shall commence upon the date hereof and shall continue in
effect for a period of two (2) years from such date. Upon the expiration of the
initial term, this Agreement shall automatically renew from year-to-year for
additional terms of one year each, unless and until terminated by either party
at the expiration of the initial term or any renewal term by giving notice of
such termination to the other party in writing at least nine (9) months prior to
the expiration of the then current term.

3.       SALE AND PURCHASE OF THE SERVICES

         3.1 Supplier agrees to provide the Services to Purchaser, and Purchaser
agrees to purchase all priming and coating Services from Supplier for the
Products, during the Term in accordance with the provisions herein.

         3.2 Attached hereto as EXHIBIT B is an outline of the processing,
packaging and quality assurance criteria which will constitute the Service
Specifications. The parties acknowledge that the specific values and parameters
of the Service Specifications cannot be finalized until completion of the
Validation (as defined in the Primer License Agreement). Upon completion of the
Validation, Supplier and Purchaser shall negotiate in good faith to promptly
finalize the Service Specifications. If Supplier and Purchaser are unable to
agree upon the final Service Specifications within four (4) weeks after
completion of the Validation, this Agreement shall automatically terminate and
be of no further force and effect. If during the course of the Validation
Purchaser requires that the Service Specifications be modified to require
Supplier to perform additional quality inspections than currently set forth in
EXHIBIT B, Supplier and Purchaser shall negotiate an appropriate increase to the
price of Services hereunder to compensate Supplier for its cost of such
additional quality inspections. If Supplier and Purchaser are unable to agree
upon the final revised pricing, if any, within four (4) weeks after completion
of the Validation, this Agreement shall automatically terminate and be of no
further force and effect.

         3.3 Once the final Service Specifications are determined in accordance
with Section 3.2, product or process changes which would cause the Coatings to
deviate from the Coating

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Specifications (including, without limitation, any change in any raw materials
used to manufacture the Coatings or the source of such raw materials) or the
Services to deviate from the Service Specifications shall not be made without
the prior written agreement of both parties. If either party desires a
modification to the Coating Specifications or the Service Specifications, such
party shall give written notice of such proposed modification to the other party
at least ninety (90) days prior to the desired effective date of such
modification. The parties shall negotiate any such requested modification in
good faith, including any adjustments to prices hereunder to reflect any
increased or decreased costs of manufacturing the Coatings or performing the
Services as a result of such modification. If the parties are unable to agree
upon such requested modification and related amendments to this Agreement within
such ninety (90) day period, this Agreement (and the Coating Specifications and
Service Specifications) shall continue in effect without change.

         3.4 On a semi-annual basis, Purchaser shall deliver to Supplier a
non-binding forecast of Purchaser's anticipated requirements of Services
hereunder for the following six (6) month period.

         3.5 Purchaser shall submit its orders for the Services on
non-cancelable purchase order forms ("Purchase Orders") specifying (i) the
number of units, and relevant French sizes, of the Products to be coated, (ii)
the destination to which the coated Products are to be shipped, and (iii) the
designated shipping dates. Supplier shall ship the coated Products on the dates
specified in each Purchase Order, provided that Purchaser has submitted such
Purchase Order, and delivered all components that Purchaser is required to
supply pursuant to Section 7 below to fill such order, at least six (6) weeks
prior to the designated shipping date, and provided, further, that the quantity
of Products designated for shipment within a single month does not exceed
_______ units.

         3.6 The terms printed on any invoice or confirmation submitted by
Supplier to Purchaser, or any Purchase Order, shall be of no force and effect.
The terms of all purchases of Products hereunder shall be governed solely by the
terms of this Agreement.

4.       PRICE AND PAYMENT/SHIPMENT TERMS

         4.1 The price of Services hereunder shall be determined based upon the
aggregate volume of units of Products per shipment designated by each Purchase
Order submitted by Purchaser pursuant to Section 3.5 above. For each shipment of
Products hereunder, the price of Services per unit of Product shall equal the
amount set forth opposite the applicable aggregate volume of Products in such
designated shipment, as set forth in a Purchase Order, provided they do not
exceed the monthly maximum of __________ units:

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         4.2 If the volume of a single French size of Product for a shipment
designated in a Purchase Order is less than 1,000 units, Purchaser shall pay
Supplier an additional charge of ______ for such order, in addition to the price
set forth in Section 4.1 above.

         4.3 The prices set forth in Section 4.1 shall be firm for the first
Contract Year. Supplier shall have the right to increase prices hereunder,
effective as of the first day of the second Contract Year and each subsequent
Contract Year, by the greater of (i) three percent (3%), or (ii) the actual
amount of any increase in Supplier's aggregate cost of raw materials ("Raw
Materials") used to manufacture the Coatings (on a per-unit of Product basis)
since the commencement of the preceding Contract Year; PROVIDED, HOWEVER, that
in no event may any such price increase exceed five percent (5%). Supplier shall
give written notice of any such price increase to Purchaser at least ninety (90)
days prior to the effective date of such price increase. If Supplier seeks to
increase prices by more than three percent (3%) in any Contract Year, Supplier
shall provide written evidence of Supplier's increased costs, including invoices
and such other evidence as may be reasonably requested by Purchaser. Purchaser
shall have the right, on reasonable prior notice, to audit the relevant books
and records of Supplier to confirm any reported cost increases.

         4.4 Unless otherwise agreed by the parties in writing, payment shall be
made by Purchaser separately for each purchase order issued to Supplier.
Purchaser shall pay all invoice amounts within forty-five (45) days of the date
of invoice in U.S. dollars.

         4.5 The Products coated by Supplier pursuant to this Agreement shall be
shipped F.O.B. Supplier's facility in Branchburg, New Jersey to the destination
designated by the Purchaser in an order.

5.       INSURANCE

         Throughout the Term of this Agreement and for a period of at least
three (3) years thereafter, Supplier and Purchaser shall each carry Commercial
General Liability Insurance in a minimum amount of $5,000,000 Combined Single
Limit, Bodily Injury and Property Damage, naming the other party as an
additional insured. Insurance to be maintained by each party pursuant to the
provisions of this Section 5 shall provide for written notice to the other party
at least fifteen (15) days in advance of any termination or cancellation of such
insurance. Upon the request of either party from time to time during the Term,
the other party shall provide a certificate evidencing such insurance coverage.

6.       DUTIES OF SUPPLIER

         (a) Supplier shall manufacture the Coatings in accordance with the
Coating Specifications, perform the Services in accordance with the Service
Specifications, and maintain reasonable production levels to supply 100% of
Purchaser's requirements for the Services, provided, that in no event shall
Supplier be required to perform Services for more than 21,000 units of Product
in any month, equivalent to an annual volume of ________ units of Product in any
Contract Year. Notwithstanding the foregoing, in the event that Purchaser
requires Services for more than ________ units of Product in any month or the
equivalent to ________ units of Product

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in any Contract Year, (i) Supplier shall perform such Services for up to an
additional _______ units of Product in any month, provided that Purchaser agrees
to reimburse Supplier for its reasonable incremental labor and variable overhead
costs to perform such additional Services, and (ii) Supplier may, in its
reasonable discretion, perform such Services for more than an additional 2,100
units of Product in any month, provided that Purchaser agrees to reimburse
Supplier for all reasonable incremental costs (including capital, fixed overhead
and environmental compliance costs) to perform such additional Services. If
Purchaser requests that Supplier perform Services for more than __________units
of Product in any month or _______ units of Product in any Contract Year,
Supplier shall provide Purchaser with a written breakdown of any incremental
costs, and such supporting evidence thereof as may be reasonably requested by
Purchaser, within ten (10) business days of such request.

         (b) Supplier shall allow Purchaser to inspect Supplier's facilities
during normal business hours and upon ten days' written notice to determine
Supplier's adherence to the terms of this Agreement.

         (c) Each party shall notify the other party promptly in writing should
either party become aware of any defect or condition which may render any of the
Coatings or Services in violation of any applicable laws or regulations.

         (d) Supplier shall include with each shipment of coated Products
released to Purchaser a written certification that such Products have been
coated and packaged in conformance with the Service Specifications.

         (e) Supplier shall keep space available for storage of the Products and
other components that Purchaser is required to provide pursuant to Section 7
below in an amount sufficient to provide Services for _______ units of Product,
provided it is no more than _ pallets of a standard size (40"w x 48"l x 48" h).

7.       COMPONENTS SUPPLIED BY PURCHASER

         7.1 Purchaser shall be responsible for providing to Supplier, at
Purchaser's sole cost and expense, all Products and other components listed in
the Service Specifications as being provided by Purchaser (the "Purchaser
Components"). Purchaser shall be responsible for ensuring that the silicone
Foley catheters included in the Purchaser Components arrive at Supplier's
facility pre-cleaned and ready for coating. Supplier shall store the Purchaser
Components in a separate designated area, which shall be kept clean and dry.

         7.2 Purchaser shall at all times retain title to all Purchaser
Components, and Supplier shall have no ownership or security interest of any
kind in such Purchaser Components. Supplier shall, at its expense, protect and
defend Purchaser's title to the Purchaser Components against all person claiming
against or through Supplier, keeping the Purchaser Components free from any
legal process or encumbrance attributable to Supplier whatsoever, and shall give
Purchaser immediate written notice of any such legal process or encumbrance and
shall indemnify Purchaser from any loss caused thereby.

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         7.3 Purchaser shall assume all risk of loss of all Purchaser Components
arising from fire or other casualty, except to the extent such fire or casualty
is due to the negligence or willful misconduct of Supplier or its employees.
Supplier shall reimburse Purchaser for its cost of any Purchaser Components that
are lost, stolen, damaged or destroyed as a result of the negligence or willful
misconduct of Supplier or its employees.

         7.4 Purchaser agrees that after completion of the Validation (as
defined in the Primer License Agreement), it will not make any change to the
silver compound or silicone Foley catheters included in the Purchaser
Components, or the manufacturing processes of such Purchaser Components, without
giving Supplier at least ninety (90) days prior notice of any such change. To
the extent that any such change requires a modification of the Service
Specifications, the parties shall negotiate any such modification and related
amendments to this Agreement in good faith, including any adjustments to prices
hereunder to reflect any increased or decreased costs of performing the Services
as a result of such modification. If Supplier and Purchaser are unable to agree
upon the revised Service Specifications and pricing within ninety (90) days
after notification, this Agreement shall automatically terminate and be of no
further force and effect.

8.       INTELLECTUAL PROPERTY

         8.1 Purchaser and Supplier shall each hold in confidence Proprietary
Information supplied to it by the other party (or observed) and shall not
divulge the same to any other person or entity without the prior permission of
the other party, except as reasonably required for purposes of normal customer
sales and service or as may be required by law. The confidentiality obligations
in this Section 8.1 shall not apply to Proprietary Information which (i) becomes
public other than through the receiving party, (ii) is already known to the
receiving party as evidenced by its written records, (iii) becomes known by the
receiving party in the future from another source which is under no obligation
of confidentiality to the disclosing party, or (iv) is subsequently developed by
the receiving party in a manner which it can establish was independent of the
disclosure hereunder. The obligations of Supplier and Purchaser pursuant to the
provisions of this Section 8.1 shall survive termination of this Agreement for a
period of five (5) years. For purposes of this Agreement, "Proprietary
Information" shall mean all data, forecasts and other information revealed to
either party by the other in writing and marked confidential or information
revealed orally or visually and the substance of which is reduced to written
form, marked confidential and transmitted to the other party within thirty (30)
days of the oral or visual disclosure.

         8.2 No press release, advertising, promotional statements (either oral
or written) in connection with the existence, substance or details of this
Agreement or the contractual arrangements relating to the subject matter of this
Agreement, shall be made by either party unless required by applicable law
without the prior written approval of the other party, which approval shall not
be unreasonably withheld.

         8.3 Supplier hereby grants Purchaser a non-exclusive, royalty-free
license to use the tradename "Hydromer" and any related trademarks (the
"Licensed Marks"), provided that they are used solely in connection with the
marketing and sale of Products that are coated by Supplier

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pursuant to this Agreement. Such license shall continue during the Term and for
such period thereafter as Purchaser may have in its inventory any Products
coated by Supplier hereunder. Supplier shall indemnify and hold harmless
Purchaser from and against any damage or expense, including reasonable
attorney's fees and disbursements, arising out of any third party claim that
Purchaser's use of the Licensed Marks in accordance with this Section 8.3
infringes upon any trademarks, trade names, copyright or other intellectual
property right of such third party; provided, that Purchaser shall have notified
Supplier promptly of such claim and shall assist and cooperate with Supplier in
the defense of such claim. This indemnification obligation shall survive the
expiration or termination of this Agreement.

9.       WARRANTIES

         9.1      Supplier warrants that the Coatings shall:

         (a)      conform to the Coating Specifications;

         (b)      be free from defects in material and workmanship; and

         (c)      be manufactured in compliance with all applicable laws.

         9.2      Supplier warrants that the Services shall:

         (a)      conform to the Service Specifications;

         (b)      be performed in a good and workmanlike manner; and

         (c)      be performed in compliance with all applicable laws

         9.3 No representation or other affirmation of fact not set forth
herein, including but not limited to statements regarding capacity, suitability
for use, or performance of the Coatings or Services, shall be or be deemed to be
a warranty by Supplier for any purpose, nor give rise to any liability or
obligation of Supplier whatsoever. EXCEPT AS SPECIFICALLY PROVIDED IN THIS
AGREEMENT, THERE ARE NO OTHER WARRANTIES, EXPRESSED OR IMPLIED, IN RESPECT OF
THE COATINGS OR SERVICES, INCLUDING BUT NOT LIMITED TO ANY IMPLIED WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

         9.4 Written notice and an explanation of the circumstances of any claim
of any breach of the warranties set forth in Section 9.1 or 9.2 shall be given
promptly by Purchaser to Supplier. In the event of such a breach, Supplier shall
promptly re-perform the defective Services or, at Supplier's discretion, refund
to Purchaser that portion of the purchase price allocable to such defective
Services. In the event that any Products shipped to Purchaser hereunder fail to
conform to the warranties set forth in Section 9.1 or 9.2, Supplier shall also
reimburse Purchaser for ninety-five percent (95%) of Purchaser's standard cost
of the silicone Foley catheters and packaging sleeves that are rendered unusable
as a result of such breach, provided that Purchaser shall have complied

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with its obligations under Sections 7.1 and 7.4 with respect to the Purchaser
Components for such shipment. In the event that Supplier and Purchaser are
unable to agree as to whether a breach of warranty has occurred, the parties
shall submit the matter to an independent laboratory mutually acceptable to the
parties. The conclusions of such independent laboratory shall be conclusive and
binding on the parties. Supplier and Purchaser shall each bear one-half (1/2) of
the costs of any such independent laboratory testing.

         9.5 In no event shall either party be liable to the other party for
loss of profits or incidental, indirect, special, consequential or other similar
damages arising out of any breach of this Agreement or obligations hereunder;
provided, however, that the indemnification obligations of each party under
Section 10 shall not be limited by this Section 9.5.

10.      INDEMNIFICATION

         Purchaser shall defend, indemnify and hold harmless Supplier from and
against any damage or expense, including reasonable attorney's fees and
disbursements ("Losses"), arising out of any third party claim for death, injury
or damage to property resulting from the use of any Products manufactured and/or
sold by Purchaser which are coated by Supplier pursuant to this Agreement,
unless such claim is a result of Supplier's breach of any warranty under Section
9.1 or 9.2 above. Supplier shall defend, indemnify and hold harmless Purchaser
from and against any Losses arising out of any third party claim for death,
injury or damage to property resulting from Supplier's breach of any warranty
under Section 9.1 or 9.2 above. These indemnification obligations shall survive
the expiration or termination of this Agreement.

11.      TERMINATION

         11.1     Either party may terminate this Agreement as follows:

                  (a) if the other party commits a material breach of any of the
         provisions of this Agreement, the Coating License Agreement or the
         Primer License Agreement and does not cure such breach within sixty
         (60) days after receipt of written notice thereof, or such additional
         time, not to exceed an additional thirty (30) days, as may be
         reasonably necessary to cure such breach, provided that throughout such
         period the breaching party is using its best efforts and proceeding
         with due diligence to cure such breach;

                  (b) immediately upon written notice to the other party in the
         event that proceedings in bankruptcy or insolvency are instituted by or
         against the other party, or a receiver is appointed, or if any
         substantial part of the assets of the other party is the object of
         attachment, sequestration or other type of comparable proceeding, and
         such proceeding is not vacated or terminated within thirty (30) days
         after its commencement or institution.

         11.2 This Agreement shall automatically terminate and be of no further
force or effect upon the expiration or termination of the Primer License
Agreement.

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         11.3 Following the expiration or termination of this Agreement, all
further rights and obligations of the parties shall cease, except that the
parties shall not be relieved of (a) their respective obligations to pay monies
due or which become due as of or subsequent to the date of expiration or
termination, and (b) any other respective obligations under this Agreement which
specifically survive or are to be performed after the date of expiration or
termination.

         11.4 In the event that Purchaser terminates this Agreement pursuant to
Section 11.1, Supplier shall provide to Purchaser, at no charge, copies of all
specifications, schematics and technical files related to all equipment,
machinery and tooling used by Supplier to perform the Services.

12.      MISCELLANEOUS

         12.1 ASSIGNMENT. Neither party shall assign, transfer or otherwise
dispose of this Agreement in whole or in part, or any of its obligations
hereunder, to a third party without the prior written consent of the other
party; PROVIDED, HOWEVER, that no such consent shall be required in connection
with the assignment of this Agreement to an affiliate of the assigning party or
to the purchaser of all or substantially all of the assets of the assigning
party to which this Agreement pertains. In the event that Supplier sells all or
substantially all of its assets that pertain to its performance of this
Agreement, Supplier shall require that the purchaser of such assets assume all
obligations of Supplier hereunder.

         12.2 FORCE MAJEURE. If the performance of any obligation under this
Agreement is prevented, restricted or interfered with by reason of war, civil
commotion, embargo, strike or any other act which is beyond the reasonable
control of the party affected, then the party so affected shall, upon giving
prior written notice to the other party, be excused from such performance to the
extent of such prevention, restriction or interference; provided, that the party
so affected shall use commercially reasonable efforts to avoid and remove such
causes of nonperformance, and shall continue performance hereunder with
reasonable dispatch whenever such causes are removed.

         12.3 ENTIRE AGREEMENT; MODIFICATION. This Agreement, the Coating
License Agreement and the Primer License Agreement constitutes the entire
agreement between the parties hereto and supersedes all previous negotiations,
agreements and commitments with respect thereto, and shall not be released,
discharged, changed or modified in any manner except by instruments signed by
duly authorized representatives of each of the parties hereto. If any provision
of this Agreement or the application thereof to any party or circumstance shall
be declared void, illegal or unenforceable, the remainder of this Agreement
shall be valid and enforceable to the extent permitted by applicable law. In
such event, the parties shall use commercially reasonable efforts to replace the
invalid or unenforceable provision by a provision that, to the extent permitted
by applicable law, achieves the purposes intended under the invalid or
unenforceable provision.

         12.4     APPLICABLE LAW; JURISDICTION.  This Agreement, and any claim
or controversy relating hereto, shall be governed by and interpreted exclusively
in accordance with the laws of the State of New Jersey.

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         12.5     WAIVERS. No claim or right arising out of or relating to a
breach of any provision of this Agreement can be discharged in whole or in part
by a waiver or renunciation of the claim or right unless the waiver or
renunciation is supported by consideration and is in writing signed by the
aggrieved party. Any failure by any party hereto to enforce at any time any
provision under this Agreement shall not be considered a waiver of that party's
right thereafter to enforce each and every provision of this Agreement.

         12.6     INDEPENDENT CONTRACTORS. Nothing contained in this Agreement
shall be construed to constitute Purchaser as a partner, employee or agent of
Supplier, nor shall Purchaser hold itself out as such. Purchaser has no right or
authority to incur, assume or create, in writing or otherwise, any warranty,
liability or other obligation of any kind, express or implied, in the name or on
behalf of Supplier, it being intended by Purchaser and Supplier that each shall
remain an independent contractor responsible for its own actions. Except as
otherwise provided herein, each party shall be responsible for its own expenses
incidental to the performance of its obligations hereunder.

         12.7     NOTICES. All notices and other communications in connection
with this Agreement shall be in writing and shall be sent to the respective
parties at the following addresses, or to such other addresses as may be
designated by the parties in writing from time to time in accordance with this
Section 12.7, by registered or certified air mail, postage prepaid, or by
overnight courier service, service fee prepaid, or by telefax with a hard copy
to follow via air mail or overnight courier service in accordance with this
Section 12.7.

         If to Supplier:      Hydromer, Inc.
                              35 Industrial Parkway
                              Branchburg, NJ 08876
                              Attn: President

         With a copy to:      Hydromer, Inc.
                              35 Industrial Parkway
                              Branchburg, NJ 08876
                              Attn:  General Counsel

         If to Purchaser:     Tyco Healthcare Group LP
                              15 Hampshire Street
                              Mansfield, MA 02048
                              Attn: Director of Research and Development

         With a copy to:      Tyco Healthcare Group LP
                              15 Hampshire Street
                              Mansfield, MA  02048
                              Attn:  General Counsel

         12.8     COUNTERPARTS. This Agreement may be executed in counterparts,
each of which shall be deemed to be an original and all of which together shall
be deemed to be one and the same instrument.

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         IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective duly authorized representatives as of the date
first written above.

                                     HYDROMER, INC.

                                     By:
                                        -------------------------------
                                           Its:

                                     TYCO HEALTHCARE GROUP LP

                                     By:
                                        -------------------------------
                                            Its:

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                                    EXHIBIT A

                       HYDROPHILIC COATING SPECIFICATIONS

                                    EXHIBIT B

                             SERVICE SPECIFICATIONS<PAGE>

                                  EXHIBIT 10.1

<PAGE>

                              EMPLOYMENT AGREEMENT

         This Agreement is made effective as of ____________, 2001 by and
between Wayne Savings Community Bank (the "Bank"), an Ohio savings and loan
association, with its principal administrative office at 151 North Market
Street, Wooster, Ohio and __________________ (the "Executive"). Any reference to
"Company" herein shall mean Wayne Savings Bancshares, Inc. the stock holding
company parent of the Bank or any successor thereto.

         WHEREAS, the Bank wishes to assure itself of the continued services of
Executive for the period provided in this Agreement; and

         WHEREAS, Executive is willing to continue to serve in the employ of the
Bank on a full-time basis for said period.

         NOW, THEREFORE, in consideration of the mutual covenants herein
contained, and upon the other terms and conditions hereinafter provided, the
parties hereby agree as follows:

1.       POSITION AND RESPONSIBILITIES

         During the period of his employment hereunder, Executive agrees to
serve as ____________ of the Bank (the "Executive Position"). During said
period, Executive also agrees to serve, if elected, as an officer of any
subsidiary or affiliate of the Bank. Failure to reelect Executive to the
Executive Position without the consent of the Executive during the term of this
Agreement (except for any termination for Cause, as defined herein) shall
constitute a breach of this Agreement.

2.       TERMS AND DUTIES

         (a)     The period of Executive's employment under this Agreement shall
begin as of the date first above written and shall continue for a period of
[thirty-six (36) or twenty-four (24)] full calendar months thereafter.
Commencing on the first anniversary date of this Agreement, and continuing at
each anniversary date thereafter, the Agreement shall renew for an additional
year such that the remaining term shall be three (3) years; provided, however,
if written notice of nonrenewal is provided to Executive at least ten (10) days
and not more than thirty (30) days prior to any anniversary date, the employment
of Executive hereunder shall cease at the end of [thirty-six (36) or twenty-four
(24)] months following such anniversary date. Prior to each notice period for
non-renewal, the disinterested members of the Board of Directors of the Bank
("Board") will conduct a performance evaluation and review of the Executive for
purposes of determining whether to extend the Agreement, and the results thereof
shall be included in the minutes of the Board's meeting and communicated to
Executive.

         (b)     During the period of his employment hereunder, except for
periods of absence occasioned by illness, reasonable vacation periods, and
reasonable leaves of absence, Executive shall devote substantially all his
business time, attention, skill, and efforts to the faithful performance of his
duties hereunder including activities and services related to the organization,
operation and management of the Bank; provided, however, that, with the approval
of the Board, as evidenced by

<PAGE>

a resolution of such Board, from time to time, Executive may serve, or continue
to serve, on the boards of directors of, and hold any other offices or positions
in, business companies or business organizations, which, in such Board's
judgment, will not present any conflict of interest with the Bank, or materially
affect the performance of Executive's duties pursuant to this Agreement (for
purposes of this Section 2(b), Board approval shall be deemed provided as to
service with any such business companies or organizations that Executive was
serving as of the date of this Agreement). See Attached Exhibit.

3.       COMPENSATION AND REIMBURSEMENT.

         (a)     The compensation specified under this Agreement shall
constitute the salary and benefits paid for the duties described in Section
2(b). The Bank shall pay Executive as compensation a salary of not less than
$________________ per year ("Base Salary"). Such Base Salary shall be payable
biweekly. During the period of this Agreement, Executive's Base Salary shall be
reviewed at least annually. Such review shall be conducted by a Committee
designated by the Board, and the Board may increase, but not decrease (except a
decrease that is generally applicable to all employees), Executive's Base Salary
(any increase in Base Salary shall become the "Base Salary" for purposes of this
Agreement). In addition to the Base Salary provided in this Section 3(a), the
Bank shall provide Executive at no cost to Executive with all such other
benefits as are provided uniformly to permanent full-time employees of the Bank.
Base Salary shall include any amounts of compensation deferred by Executive
under qualified and nonqualified plans maintained by the Bank.

         (b)     The Bank will provide Executive with employee benefit plans,
arrangements and perquisites substantially equivalent to those in which
Executive was participating or otherwise deriving benefit from immediately prior
to the beginning of the term of this Agreement, and the Bank will not, without
Executive's prior written consent, make any changes in such plans, arrangements
or perquisites which would adversely affect Executive's rights or benefits
thereunder, except as to any changes that are applicable to all employees or as
reasonably or customarily available. Without limiting the generality of the
foregoing provisions of this Subsection (b), Executive will be entitled to
participate in or receive benefits under any employee benefit plans including
but not limited to, retirement plans, supplemental retirement plans, pension
plans, profit-sharing plans, health-and-accident plans, medical coverage or any
other employee benefit plan or arrangement made available by the Bank in the
future to its senior executives and key management employees, subject to and on
a basis consistent with the terms, conditions and overall administration of such
plans and arrangements. Executive will be entitled to incentive compensation and
bonuses as provided in any plan of the Bank in which Executive is eligible to
participate (and he shall be entitled to a pro rata distribution under any
incentive compensation or bonus plan as to any year in which a termination of
employment occurs, other than termination for Cause). Nothing paid to the
Executive under any such plan or arrangement will be deemed to be in lieu of
other compensation to which the Executive is entitled under this Agreement.

         (c)     In addition to the Base Salary provided for by paragraph (a) of
this Section 3, the Bank shall pay or reimburse Executive for all reasonable
travel and other reasonable expenses incurred by Executive performing his
obligations under this Agreement and may provide such

                                       2
<PAGE>

additional compensation in such form and such amounts as the Board may from time
to time determine.

4.       PAYMENTS TO EXECUTIVE UPON AN EVENT OF TERMINATION.

         (a)     Upon the occurrence of an Event of Termination (as herein
defined) during the Executive's term of employment under this Agreement, the
provisions of this Section shall apply. As used in this Agreement, an "Event of
Termination" shall mean and include any one or more of the following: (i) the
termination by the Bank or the Company of Executive's full-time employment
hereunder for any reason other than (A) termination for Cause (as defined in
Section 7 hereof), (B) upon Retirement (as defined in Section 6 hereof), or (C)
for Disability (as set forth in Section 5 hereof); and (ii) Executive's
resignation from the Bank's employ following (A) any failure to elect or reelect
or to appoint or reappoint Executive to the Executive Position, (B) a material
change in Executive's function, duties, or responsibilities, which change would
cause Executive's position to become one of lesser responsibility, importance,
or scope from the position and attributes thereof described in Section 1 above,
to which Executive has not agreed in writing (and any such material change shall
be deemed a continuing breach of this Agreement), (C) a relocation of
Executive's principal place of employment to a location more than 30 miles
outside the City of Wooster, or a material reduction in the benefits and
perquisites, including Base Salary, to the Executive from those being provided
as of the effective date of this Agreement (except for any reduction that is
part of an employee-wide reduction in pay or benefits), (D) a liquidation or
dissolution of the Bank or the Company, or (E) material breach of this Agreement
by the Bank. Upon the occurrence of any event described in clauses (ii) (A),
(B), (C), (D) or (E) above, Executive shall have the right to elect to terminate
his employment under this Agreement by resignation upon not less than thirty
(30) days prior written notice given within a reasonable period of time (not to
exceed, except in case of a continuing breach, four calendar months) after the
event giving rise to said right to elect, which termination by Executive shall
be an Event of Termination. No payments or benefits shall be due to Executive
under this Agreement upon the termination of Executive's employment except as
provided in Sections 3, 4 or 5 hereof.

         (b)     Upon the occurrence of an Event of Termination, the Bank shall
pay Executive, or, in the event of his subsequent death, his beneficiary or
beneficiaries, or his estate, as the case may be, as severance pay or liquidated
damages, or both, a cash amount equal to the greater of the payments due for the
remaining term of the Agreement, or three (3) times the sum of: (i) the highest
annual rate of Base Salary paid to Executive at any time under this Agreement,
and (ii) the greater of (x) the average annual cash bonus paid to Executive with
respect to the three completed fiscal years prior to the Event of Termination,
or (y) the cash bonus paid to Executive with respect to the fiscal year ended
prior to the Event of Termination; PROVIDED HOWEVER, that if the Bank is not in
compliance with its minimum capital requirements or if such payments would cause
the Bank's capital to be reduced below its minimum capital requirements, such
payments shall be deferred until such time as the Bank is in capital compliance.
At the election of the Executive, which election may be made annually by January
31 of each year and is irrevocable for the year in which made (and once payments
commence), such payments shall be made in a lump sum or paid quarterly during
the remaining term of the agreement following the Executive's termination. In
the event that no election

                                       3
<PAGE>

is made, payment to the Executive will be made on a quarterly basis during the
remaining term of the Agreement. Such payments shall not be reduced in the event
the Executive obtains other employment following termination of employment.

         (c)     Upon the occurrence of an Event of Termination, the Bank will
cause to be continued life, medical and dental coverage substantially
comparable, as reasonably or customarily available, to the coverage maintained
by the Bank for Executive prior to his termination, except to the extent such
coverage may be changed in its application to all Bank employees or is not
available on an individual basis to a terminated employee. Such coverage shall
cease thirty-six (36) months following the Event of Termination.

         (d)     Notwithstanding anything to the contrary in this Agreement,
in the event that:

               (i)  the aggregate payments or benefits to be made or afforded to
                    Executive (the "Termination Benefits") would be deemed to
                    include an "excess parachute payment" under Section 280G of
                    the Code or any successor thereto, and

               (ii) if such Termination Benefits were reduced to an amount (the
                    "Non-Triggering Amount"), the value of which is one dollar
                    ($1.00) less than an amount equal to the total amount of
                    payments permissible under Section 280G of the Code or any
                    successor thereto,

then the Termination Benefits to be paid to Executive shall be so reduced so as
to be a Non-Triggering Amount. The allocation of the reduction required hereby
among Termination Benefits provided by the preceding paragraphs of this Section
4 shall be determined by the Executive.

5.  TERMINATION FOR DISABILITY.

         (a)     If, as a result of Executive's incapacity due to physical or
mental illness, he shall have been absent from his duties with the Bank or the
Company on a full-time basis for six (6) consecutive months, and within thirty
(30) days after written notice of potential termination is given he shall not
have returned to the full-time performance of his duties, the Bank may terminate
Executive's employment for "Disability."

         (b)     The Bank will pay Executive, as disability pay, a bi-weekly
payment equal to 75% of the Executive's bi-weekly rate of Base Salary on the
effective date of such termination. These disability payments shall commence on
the effective date of Executive's termination and will end on the earlier of (i)
the date Executive returns to the full-time employment of the Bank in the same
capacity as he was employed prior to his termination for Disability and pursuant
to an employment agreement between Executive and the Bank; (ii) Executive's
full-time employment by another employer; (iii) Executive attaining a Retirement
age as identified in Section 6; or (iv) Executive's death. The disability pay
shall be reduced by the amount, if any, paid to the Executive under any plan of
the Bank or the Company providing disability benefits to the Executive.

                                       4
<PAGE>

         (c)     The Bank will cause to be continued life, medical, and dental
coverage substantially comparable, as reasonable or customarily available, to
the coverage maintained by the Bank for Executive prior to his termination for
Disability, except to the extent such coverage may be changed in its application
to all Bank employees. This coverage shall cease upon the earlier of (i) the
date Executive returns to the full-time employment of the Bank in the same
capacity as he was employed prior to his termination for Disability and pursuant
to an employment agreement between Executive and the Bank; (ii) Executive's
full-time employment by another employer; (iii) Executive attaining the
Retirement age as identified in Section 6; or (iv) Executive's death.

         (d)     Notwithstanding the foregoing, there will be no reduction in
the compensation otherwise payable to Executive during any period during which
Executive is incapable of performing his duties hereunder by reason of temporary
disability.

6.       TERMINATION UPON RETIREMENT.

         Termination by the Bank of the Executive based on "Retirement" shall
mean termination of executive in accordance with any retirement policy
established with Executive's consent with respect to him. Upon termination of
Executive upon Retirement, no amounts or benefits shall be due Executive under
this Agreement and the Executive shall be entitled to all benefits under any
retirement plan of the Bank and other plans to which Executive is a party.

7.        TERMINATION FOR CAUSE.

          The term "Termination for Cause" shall mean termination because of the
Executive's personal dishonesty, incompetence, willful misconduct, any 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 this Agreement. In determining incompetence, the acts
or omissions shall be measured against standards generally prevailing in the
savings institution and commercial banking industry. For purposes of this
paragraph, no act or failure to act on the part of Executive shall be considered
"willful" unless done, or omitted to be done, by the Executive not in good faith
and without reasonable belief that the Executive's action or omission was in the
best interest of the Bank. Notwithstanding the foregoing, Executive shall not be
deemed to have been Terminated for Cause unless and until there shall have been
delivered to him a copy of a resolution duly adopted by the affirmative vote of
not less than a majority of the members of the Board at a meeting of the Board
called and held for that purpose (after reasonable notice to Executive and an
opportunity for him, together with counsel, to be heard before the Board),
finding that in the good faith opinion of the Board, Executive was guilty of
conduct justifying Termination for Cause and specifying the particulars thereof
in detail. The Executive shall not have the right to receive compensation or
other benefits for any period after Termination for Cause. Any non-vested stock
options or restricted stock granted to Executive under any stock option plan or
restricted stock plan of the Bank, the Company or any subsidiary or affiliate
thereof, shall become null and void effective

                                       5
<PAGE>

upon Executive's receipt of Notice of Termination for Cause pursuant to Section
8 hereof, and any non-vested stock options shall not be exercisable by Executive
at any time subsequent to such Termination for Cause, (unless it is determined
in arbitration that grounds for termination of Executive for Cause did not
exist, in which event all terms of the options or restricted stock as of the
date of termination shall apply, and any time periods for exercising such
options shall commence from the date of resolution in arbitration).

8.       NOTICE.

         (a)     Any purported termination by the Bank for Cause shall be
communicated by Notice of Termination to the Executive. For purposes of this
Agreement, a "Notice of Termination" shall mean a written notice which shall
indicate the specific termination provision in this Agreement relied upon and
shall set forth in reasonable detail the facts and circumstances claimed to
provide a basis for termination of Executive's employment under the provision so
indicated. If, within thirty (30) days after any Notice of Termination for Cause
is given, the Executive notifies the Bank or the Company that a dispute exists
concerning the termination, the parties shall promptly proceed to arbitration.
Notwithstanding the pendency of any such dispute, the Bank and the Company may
discontinue to pay Executive compensation until the dispute is finally resolved
in accordance with this Agreement. If it is determined that Executive is
entitled to compensation and benefits under Section 4 of this Agreement, the
payment of such compensation and benefits by the Bank and Company shall commence
immediately following the date of resolution by arbitration, with interest due
Executive on the cash amount that would have been paid pending arbitration (at
the prime rate as published in the WALL STREET JOURNAL from time to time).

         (b)     Any other purported termination by the Bank or by Executive
shall be communicated by a Notice of Termination to the other party. For
purposes of this Agreement, a "Notice of Termination" shall mean a written
notice which shall indicate the specific termination provision in this Agreement
relied upon and shall set forth in detail the facts and circumstances claimed to
provide a basis for termination of employment under the provision so indicated.
"Date of Termination" shall mean the date of the Notice of Termination. If,
within thirty (30) days after any Notice of Termination is given, the party
receiving such Notice of Termination notifies the other party that a dispute
exists concerning the termination, the parties shall promptly proceed to
arbitration as provided in Section 18 of this Agreement. Notwithstanding the
pendency of any such dispute, the Bank shall continue to pay the Executive his
Base Salary, and other compensation and benefits in effect when the notice
giving rise to the dispute was given (except as to termination of Executive for
Cause). In the event of the voluntary termination by the Executive of his
employment, which is disputed by the Bank, and if it is determined in
arbitration that Executive is not entitled to termination benefits pursuant to
this Agreement, he shall return all cash payments made to him pending resolution
by arbitration, with interest thereon at the prime rate as published in the WALL
STREET JOURNAL from time to time if it is determined in arbitration that
Executive's voluntary termination of employment was not taken in good faith and
not in the reasonable belief that grounds existed for his voluntary termination.

9.       POST-TERMINATION OBLIGATIONS.

                                       6
<PAGE>

         (a)     All payments and benefits to Executive under this Agreement
shall be subject to Executive's compliance with paragraph (b) of this Section 9
during the term of this Agreement and for one (1) full year after the expiration
or termination hereof.

         (b)     Executive shall, upon reasonable notice, furnish such
information and assistance to the Bank as may reasonably be required by the Bank
in connection with any litigation in which it or any of its subsidiaries or
affiliates is, or may become, a party.

         (c)     Executive recognizes and acknowledges that the knowledge of the
business activities and plans for business activities of the Bank and affiliates
thereof, as it may exist from time to time, is a valuable, special and unique
asset of the business of the Bank. Executive will not, during or after the term
of his employment, disclose any knowledge of the past, present, planned or
considered business activities of the Bank or affiliates thereof to any person,
firm, corporation, or other entity for any reason or purpose whatsoever (except
for such disclosure as may be required to be provided to the Office of Thrift
Supervision ("OTS"), the Federal Deposit Insurance Corporation (the "FDIC"), or
other federal banking agency with jurisdiction over the Bank or Executive).
Notwithstanding the foregoing, Executive may disclose any knowledge of banking,
financial and/or economic principles, concepts or ideas which are not solely and
exclusively derived from the business plans and activities of the Bank, and
Executive may disclose any information regarding the Bank or the Company which
is otherwise publicly available. In the event of a breach or threatened breach
by the Executive of the provisions of this Section 9, the Bank will be entitled
to an injunction restraining Executive from disclosing, in whole or in part, the
knowledge of the past, present, planned or considered business activities of the
Bank or affiliates thereof, or from rendering any services to any person, firm,
corporation, other entity to whom such knowledge, in whole or in part, has been
disclosed or is threatened to be disclosed. Nothing herein will be construed as
prohibiting the Bank from pursuing any other remedies available to the Bank for
such breach or threatened breach, including the recovery of damages from
Executive.

10.      SOURCE OF PAYMENTS.

         All payments provided in this Agreement shall be timely paid in cash or
check from the general funds of the Bank. The Company, however, guarantees
payment and provision of all amounts and benefits due hereunder to Executive
and, if such amounts and benefits due from the Bank are not timely paid or
provided by the Bank, such amounts and benefits shall be paid or provided by the
Company.

11.      EFFECT ON PRIOR AGREEMENTS AND EXISTING BENEFITS PLANS.

         This Agreement contains the entire understanding between the parties
hereto and supersedes any prior employment agreement between the Bank or any
predecessor of the Bank and Executive, except that this Agreement shall not
affect or operate to reduce any benefit or compensation inuring to the Executive
of a kind elsewhere provided. No provision of this Agreement shall be
interpreted to mean that Executive is subject to receiving fewer benefits than
those available to him without reference to this Agreement.

                                       7
<PAGE>

12.      NO ATTACHMENT.

        (a)      Except as required by law, no right to receive payments under
this Agreement shall be subject to anticipation, commutation, alienation, sale,
assignment, encumbrance, charge, pledge, or hypothecation, or to execution,
attachment, levy, or similar process or assignment by operation of law, and any
attempt, voluntary or involuntary, to affect any such action shall be null,
void, and of no effect.

         (b)     This Agreement shall be binding upon, and inure to the benefit
of, Executive and the Bank and their respective successors and assigns.

13.      MODIFICATION AND WAIVER.

         (a)     This Agreement may not be modified or amended except by an
instrument in writing signed by the parties hereto.

         (b)     No term or condition of this Agreement shall be deemed to have
been waived, nor shall there be any estoppel against the enforcement of any
provision of this Agreement, except by written instrument of the party charged
with such waiver or estoppel. No such written waiver shall be deemed a
continuing waiver unless specifically stated therein, and each such waiver shall
operate only as to the specific term or condition waived and shall not
constitute a waiver of such term or condition for the future as to any act other
than that specifically waived.

14.      REQUIRED REGULATORY PROVISIONS.

         (a)     The Bank's Board of Directors may terminate the Executive's
employment at any time, but any termination by the Bank's Board of Directors,
other than Termination for Cause, shall not prejudice Executive's right to
compensation or other benefits under this Agreement. Executive shall not have
the right to receive compensation or other benefits for any period after
Termination for Cause as defined in Section 8 hereinabove.

         (b)     If the Executive 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) (12 U.S.C. ss.ss. 1818(e)(3)) or 8(g) (12 U.S.C.
ss. 1818(g)) of the Federal Deposit Insurance Act (the "FDI Act"), as amended by
the Financial Institutions Reform, Recovery and Enforcement Act of 1989, the
Bank's obligations under this contract 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 Executive 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.

         (c)     If the Executive is removed and/or permanently prohibited from
participating in the conduct of the Bank's affairs by an order issued under
Section 8(e) (12 U.S.C. ss.ss. 1818(e)) or 8(g) (12 U.S.C. ss. 1818(g)) of the
FDI Act, as amended by the Financial Institutions Reform, Recovery

                                       8
<PAGE>

and Enforcement Act of 1989, all obligations of the Bank under this contract
shall terminate as of the effective date of the order, but vested rights of the
contracting parties shall not be affected.

         (d)     If the Bank is in default as defined in Section 3(x)
(12 U.S.C. ss. 1813(x)(1)) of the Federal Deposit Insurance Act, as amended by
the Financial Institutions Reform, Recovery and Enforcement Act of 1989, all
obligations of the Bank under this contract shall terminate as of the date of
default, but this paragraph shall not affect any vested rights of the
contracting parties.

         (e)     All obligations of the Bank under this contract shall be
terminated, except to the extent determined that continuation of the contract is
necessary for the continued operation of the institution, (i) by the Director,
at the time FDIC or the Resolution Trust Corporation enters into an agreement to
provide assistance to or on behalf of the Bank; or (ii) by the OTS at the time
the OTS or its District Director approves a supervisory merger to resolve
problems related to the operations of the Bank or when the Bank is determined by
the OTS or FDIC 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.

         (f)     Any payments made to Executive pursuant to this Agreement, or
otherwise, are subject to and conditioned upon their compliance with 12 USC
Section 1828(k) and any regulations promulgated thereunder.

15.      SEVERABILITY.

         If, for any reason, any provision of this Agreement, or any part of any
provision, is held invalid, such invalidity shall not affect any other provision
of this Agreement or any part of such provision not held so invalid, and each
such other provision and part thereof shall to the full extent consistent with
law continue in full force and effect.

16.      HEADINGS FOR REFERENCE ONLY.

         The headings of sections and paragraphs herein are included solely for
convenience of reference and shall not control the meaning or interpretation of
any of the provisions of this Agreement.

17.      GOVERNING LAW.

         This Agreement shall be governed by the laws of the State of Ohio but
only to the extent not superseded by federal law.

                                       9
<PAGE>

18.      ARBITRATION.

         Any dispute or controversy arising under or in connection with this
Agreement shall be settled exclusively by arbitration, conducted before a panel
of three arbitrators sitting in a location selected by the employee within the
[Cleveland] metropolitan area, in accordance with the rules of the American
Arbitration Association then in effect. Judgment may be entered on the
arbitrator's award in any court having jurisdiction; provided, however, that
Executive shall be entitled to seek specific performance of his right to be paid
until the Date of Termination during the pendency of any dispute or controversy
arising under or in connection with this Agreement.

19.      PAYMENT OF LEGAL FEES.

         All reasonable legal fees paid or incurred by Executive pursuant to any
dispute or question of interpretation relating to this Agreement shall be paid
or reimbursed by the Bank, provided that the dispute or interpretation has been
settled by Executive and the Bank or resolved in the Executive's favor.

20.      INDEMNIFICATION.

         The Bank and the Company shall provide Executive (including his heirs,
executors and administrators) with coverage under a standard directors' and
officers' liability insurance policy at its expense, and shall indemnify
Executive (and his heirs, executors and administrators) to the fullest extent
permitted under federal law against all expenses and liabilities reasonably
incurred by him in connection with or arising out of any action, suit or
proceeding in which he may be involved by reason of his having been a director
or officer of the Bank or the Company (whether or not he continues to be a
director or officer at the time of incurring such expenses or liabilities), such
expenses and liabilities to include, but not be limited to, judgments, court
costs and attorneys' fees and the cost of reasonable settlements (such
settlements must be approved by the Board of Directors of the Bank or the
Company, as appropriate), provided, however, neither the Bank nor Company shall
be required to indemnify or reimburse the Executive for legal expenses or
liabilities incurred in connection with an action, suit or proceeding arising
from any illegal or fraudulent act committed by the Executive.

21.      SUCCESSOR TO THE BANK.

         The Bank shall require any successor or assignee, whether direct or
indirect, by purchase, merger, consolidation or otherwise, to all or
substantially all the business or assets of the Bank or the Company, expressly
and unconditionally to assume and agree to perform the Bank's obligations under
this Agreement, in the same manner and to the same extent that the Bank would be
required to perform if no such succession or assignment had taken place.

                                   SIGNATURES

                                       10
<PAGE>

         IN WITNESS WHEREOF, the Bank and the Company have caused this Agreement
to be executed and their seals to be affixed hereunto by their duly authorized
officers, and Executives have signed this Agreement, on the day and date first
above written.

ATTEST:                                     WAYNE SAVINGS COMMUNITY BANK

                                            By:
--------------------------                      --------------------------------
Secretary

WITNESS:                                    EXECUTIVE:

                                            By:
--------------------------                      --------------------------------

CONSENT OF GUARANTOR (PURSUANT
TO SECTION TEN HEREOF)

WAYNE SAVINGS BANCSHARES, INC.

By:
     -------------------------

                                       11

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