Document:

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                                    [FORM OF]

                          BROOKLYN FEDERAL SAVINGS BANK

                          EMPLOYEE STOCK OWNERSHIP PLAN

                      (adopted effective November 1, 2004)

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                          BROOKLYN FEDERAL SAVINGS BANK
                          EMPLOYEE STOCK OWNERSHIP PLAN

        This Employee Stock Ownership Plan, executed on the ________ day of
______________, 200__, by Brooklyn Federal Savings Bank, a federally chartered
stock savings bank (the "Bank"),

                           W I T N E S S E T H T H A T

        WHEREAS, the board of directors of the Bank has resolved to adopt an
employee stock ownership plan for eligible employees of the Bank and
subsidiaries of the Bank, if any, in accordance with the terms and conditions
presented set forth herein;

        NOW, THEREFORE, the Bank hereby adopts the following Plan setting forth
the terms and conditions pertaining to contributions by the Employer and the
payment of benefits to Participants and Beneficiaries.

        IN WITNESS WHEREOF, the Bank has adopted this Plan and caused this
instrument to be executed by its duly authorized officers as of the above date.

ATTEST:

________________________________         By:  __________________________________
Secretary                                     President

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                                 C O N T E N T S

                                                                        PAGE NO.
SECTION 1.  PLAN IDENTITY......................................................1
        1.1   NAME.............................................................1
        1.2   PURPOSE..........................................................1
        1.3   EFFECTIVE DATE...................................................1
        1.4   FISCAL PERIOD....................................................1
        1.5   SINGLE PLAN FOR ALL EMPLOYERS....................................1
        1.6   INTERPRETATION OF PROVISIONS.....................................1
SECTION 2.  DEFINITIONS........................................................1
SECTION 3.    ELIGIBILITY FOR PARTICIPATION....................................6
        3.1   INITIAL ELIGIBILITY..............................................6
        3.2   DEFINITION OF ELIGIBILITY YEAR...................................6
        3.3   TERMINATED EMPLOYEES.............................................6
        3.4   CERTAIN EMPLOYEES INELIGIBLE.....................................6
        3.5   PARTICIPATION AND REPARTICIPATION................................7
        3.6   OMISSION OF ELIGIBLE EMPLOYEE....................................7
        3.7   INCLUSION OF INELIGIBLE EMPLOYEE.................................7
SECTION 4.    CONTRIBUTIONS AND CREDITS........................................7
        4.1   DISCRETIONARY CONTRIBUTIONS......................................7
        4.2   CONTRIBUTIONS FOR STOCK OBLIGATIONS..............................7
        4.3   CONDITIONS AS TO CONTRIBUTIONS...................................8
        4.4   ROLLOVER CONTRIBUTIONS...........................................8
SECTION 5.    LIMITATIONS ON CONTRIBUTIONS AND ALLOCATIONS.....................8
        5.1   LIMITATION ON ANNUAL ADDITIONS...................................8
        5.2   EFFECT OF LIMITATIONS...........................................10
        5.3   LIMITATIONS AS TO CERTAIN PARTICIPANTS..........................10
        5.4   ERRONEOUS ALLOCATIONS...........................................10
SECTION 6.    TRUST FUND AND ITS INVESTMENT...................................11
        6.1   CREATION OF TRUST FUND..........................................11
        6.2   STOCK FUND AND INVESTMENT FUND..................................11
        6.3   ACQUISITION OF STOCK............................................11
        6.4   PARTICIPANTS' OPTION TO DIVERSIFY...............................12
SECTION 7.    VOTING RIGHTS AND DIVIDENDS ON STOCK............................12
        7.1   VOTING AND TENDERING OF STOCK...................................12
        7.2   DIVIDENDS ON STOCK..............................................13
SECTION 8.    ADJUSTMENTS TO ACCOUNTS.........................................13
        8.1   ALLOCATIONS.....................................................13
        8.2   CHARES TO ACCOUNTS..............................................14
        8.3   STOCK FUND ACCOUNT..............................................14
        8.4   INVESTMENT FUND ACCOUNT.........................................14
        8.5   ADJUSTMENT TO VALUE OF TRUST FUND...............................14
        8.6   PARTICIPANT STATEMENTS..........................................14
SECTION 9.    VESTING OF PARTICIPANTS' INTERESTS..............................14
        9.1   DEFERRED VESTING IN ACCOUNTS....................................14
        9.2   COMPUTATION OF VESTING YEARS....................................14
        9.3   FULL VESTING UPON CERTAIN EVENTS................................15
        9.4   FULL VESTING UPON PLAN TERMINATION..............................16
        9.5   FORFEITURE, REPAYMENT, AND RESTORAL.............................16
        9.6   ACCOUNTING FOR FORFEITURES......................................17

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        9.7      VESTING AND NONFORFEITABILITY................................17
SECTION 10.      PAYMENT OF BENEFITS..........................................17
        10.1     BENEFITS FOR PARTICIPANTS....................................17
        10.2     TIME FOR DISTRIBUTION........................................17
        10.3     MARITAL STATUS...............................................19
        10.4     DELAY IN BENEFIT DETERMINATION...............................19
        10.5     ACCOUNTING FOR BENEFIT PAYMENTS..............................19
        10.6     OPTIONS TO RECEIVE AND SELL STOCK............................19
        10.7     RESTRICTIONS ON DISPOSITION OF STOCK.........................20
        10.8     CONTINUING LOAN PROVISIONS; CREATIONS OF
                    PROTECTIONS AND RIGHTS....................................20
        10.9     DIRECT ROLLOVER OF ELIGIBLE DISTRIBUTION.....................20
        10.10    WAIVER OF 30-DAY PERIOD AFTER NOTICE OF DISTRIBUTION.........21
SECTION 11.      RULES GOVERNING BENEFIT CLAIMS AND REVIEW OF APPEALS.........21
        11.1     CLAIM FOR BENEFITS...........................................21
        11.2     NOTIFICATION BY COMMITTEE....................................21
        11.3     CLAIMS REVIEW PROCEDURE......................................21
SECTION 12.      THE COMMITTEE AND ITS FUNCTIONS..............................22
        12.1     AUTHORITY OF COMMITTEE.......................................22
        12.2     IDENTITY OF COMMITTEE........................................22
        12.3     DUTIES OF COMMITTEE..........................................22
        12.4     VALUATION OF STOCK...........................................23
        12.5     COMPLIANCE WITH ERISA........................................23
        12.6     ACTION BY COMMITTEE..........................................23
        12.7     EXECUTION OF DOCUMENTS.......................................23
        12.8     ADOPTION OF RULES............................................23
        12.9     RESPONSIBILITIES TO PARTICIPANTS.............................23
        12.10    ALTERNATIVE PAYEES IN EVENT OF INCAPACITY....................23
        12.11    INDEMNIFICATION BY EMPLOYERS.................................23
        12.12    NONPARTICIPATION BY INTERESTED MEMBER........................23
SECTION 13.      ADOPTION, AMENDMENT, OR TERMINATION OF THE PLAN..............24
        13.1     ADOPTION OF PLAN BY OTHER EMPLOYERS..........................24
        13.2     PLAN ADOPTION SUBJECT TO QUALIFICATION.......................24
        13.3     RIGHT TO AMEND OR TERMINATE..................................24
SECTION 14.      MISCELLANEOUS PROVISIONS.....................................24
        14.1     PLAN CREATES NO EMPLOYMENT RIGHTS............................24
        14.2     NONASSIGNABILITY OF BENEFITS.................................24
        14.3     LIMIT OF EMPLOYER LIABILITY..................................25
        14.4     TREATMENT OF EXPENSES........................................25
        14.5     NUMBER AND GENDER............................................25
        14.6     NONDIVERSION OF ASSETS.......................................25
        14.7     SEPARABILITY OF PROVISIONS...................................25
        14.8     SERVICE OF PROCESS...........................................25
        14.9     GOVERNING STATE LAW..........................................25
        14.10    EMPLOYER CONTRIBUTIONS CONDITIONED ON DEDUCTIBILITY..........25
        14.11    UNCLAIMED ACCOUNTS...........................................25
        14.12    QUALIFIED DOMESTIC RELATIONS ORDER...........................26
SECTION 15.      TOP-HEAVY PROVISIONS.........................................26
        15.1     TOP-HEAVY PLAN...............................................26
        15.2     SUPER TOP-HEAVY PLAN.........................................27
        15.3     DEFINITIONS..................................................27
        15.4     TOP-HEAVY RULES OF APPLICATION...............................28
        15.5     MINIMUM CONTRIBUTIONS........................................29
        15.7     TOP-HEAVY PROVISIONS CONTROL IN TOP-HEAVY PLAN...............29

                                      (ii)

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                          BROOKLYN FEDERAL SAVINGS BANK
                          EMPLOYEE STOCK OWNERSHIP PLAN

SECTION 1.  PLAN IDENTITY.

        1.1     NAME. The name of this Plan is "Brooklyn Federal Savings Bank
Employee Stock Ownership Plan."

        1.2     PURPOSE. The purpose of this Plan is to describe the terms and
conditions under which contributions made pursuant to the Plan will be credited
and paid to the Participants and their Beneficiaries.

        1.3     EFFECTIVE DATE. The Effective Date of this Plan is November 1,
2004.

        1.4     FISCAL PERIOD. This Plan shall be operated on the basis of a
November 1 to October 31 fiscal year for the purpose of keeping the Plan's books
and records and distributing or filing any reports or returns required by law.

        1.5     SINGLE PLAN FOR ALL EMPLOYERS. This Plan shall be treated as a
single plan with respect to all participating Employers for the purpose of
crediting contributions and forfeitures and distributing benefits, determining
whether there has been any termination of Service, and applying the limitations
set forth in Section 5.

        1.6     INTERPRETATION OF PROVISIONS. The Employers intend this Plan and
the Trust Agreement to be a qualified stock bonus plan under Section 401(a) of
the Code and an employee stock ownership plan within the meaning of Section
407(d)(6) of ERISA and Section 4975(e)(7) of the Code. The Plan is intended to
have its assets invested primarily in qualifying employer securities of one or
more Employers within the meaning of Section 407(d)(3) of ERISA, and to satisfy
any requirement under ERISA or the Code applicable to such a plan.

        Accordingly, the Plan and Trust Agreement shall be interpreted and
applied in a manner consistent with this intent and shall be administered at all
times and in all respects in a nondiscriminatory manner.

SECTION 2.  DEFINITIONS.

        The following capitalized words and phrases shall have the meanings
specified when used in this Plan and in the Trust Agreement, unless the context
clearly indicates otherwise:

        "ACCOUNT" means a Participant's interest in the assets accumulated under
this Plan as expressed in terms of a separate account balance which is
periodically adjusted to reflect his Employer's contributions, the Plan's
investment experience, and distributions and forfeitures.

        "ACTIVE PARTICIPANT" means a Participant who has satisfied the
eligibility requirements under Section 3 and who has at least 1,000 Hours of
Service during the current Plan Year

        "BANK" means Brooklyn Federal Savings Bank and any entity which succeeds
to the business of Brooklyn Federal Savings Bank and adopts this Plan as its own
pursuant to Section 13.1 of the Plan.

        "BENEFICIARY" means the person or persons who are designated by a
Participant to receive benefits payable under the Plan on the Participant's
death. In the absence of any designation or if all the designated Beneficiaries
shall die before the Participant dies or shall die before all benefits have been
paid, the Participant's Beneficiary shall be his surviving Spouse, if any, or
his estate if he is not survived by a Spouse.

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The Committee may rely upon the advice of the Participant's executor or
administrator as to the identity of the Participant's Spouse.

        "BREAK IN SERVICE" means any Plan Year, or, for the initial eligibility
computation period under Section 3.2, the 12-consecutive month period beginning
on the first day of which an Employee has an Hour of Service, in which an
Employee has 500 or fewer Hours of Service. Solely for this purpose, an Employee
shall be considered employed for his normal hours of paid employment during a
Recognized Absence (said Employee shall not be credited with more than 501 Hours
of Service to avoid a Break in Service), unless he does not resume his Service
at the end of the Recognized Absence. Further, if an Employee is absent for any
period (i) by reason of the Employee's pregnancy, (ii) by reason of the birth of
the Employee's child, (iii) by reason of the placement of a child with the
Employee in connection with the Employee's adoption of the child, or (iv) for
purposes of caring for such child for a period beginning immediately after such
birth or placement, the Employee shall be credited with the Hours of Service
which would normally have been credited but for such absence, up to a maximum of
501 Hours of Service.

        "CODE" means the Internal Revenue Code of 1986, as amended.

        "COMMITTEE" means the committee responsible for the administration of
this Plan in accordance with Section 12.

        "COMPANY" means Brooklyn Federal Bancorp, Inc., the holding company of
the Bank, and any successor entity which succeeds to the business of the
Company.

        "DISABILITY" means the inability to engage in any substantial gainful
activity by reason of any medically determinable physical or mental impairment
which can be expected to result in death or which has lasted or can be expected
to last for a continuous period of not less than 12 months. An individual shall
not be considered to be permanently and totally disabled unless he furnishes
proof of the existence thereof in such form and manner, and at such times, as
the Committee may require.

        "EFFECTIVE DATE" means November 1, 2004.

        "ELIGIBLE EMPLOYEE" means an Employee, other than an Employee identified
in Section 3.4, who has both (i) satisfied the age requirement of Section 3.1(b)
and (ii) has completed two Eligibility Years of service in accordance with
Section 3.2.

        "EMPLOYEE" means any individual who is or has been employed or
self-employed by an Employer. "Employee" also means an individual employed by a
leasing organization who, pursuant to an agreement between an Employer and the
leasing organization, has performed services for the Employer and any related
persons (within the meaning of Section 414(n)(6) of the Code) on a substantially
full-time basis for more than one year, if such services are performed under the
primary direction or control of the Employer. However, such a "leased employee"
shall not be considered an Employee if (i) he participates in a money purchase
pension plan sponsored by the leasing organization which provides for immediate
participation, immediate full vesting, and an annual contribution of at least 10
percent of the Employee's 415 Compensation, and (ii) leased employees do not
constitute more than 20 percent of the Employer's total work force (including
leased employees, but excluding Highly Paid Employees and any other Employees
who have not performed services for the Employer on a substantially full-time
basis for at least one year).

        "EMPLOYER" means the Bank or any affiliate within the purview of section
414(b), (c) or (m) and 415(h) of the Code, any other corporation, partnership,
or proprietorship which adopts this Plan with the Bank's consent pursuant to
Section 13.1, and any entity which succeeds to the business of any Employer and
adopts the Plan pursuant to Section 13.2.

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        "ENTRY DATE" means the Effective Date of the Plan and each November 1
and May 1 of each Plan Year after the Effective Date.

        "ERISA" means the Employee Retirement Income Security Act of 1974 (P.L.
93-406, as amended).

        "415 COMPENSATION"

                (a)     shall mean wages, as defined in Code Section 3401(a) for
        purposes of income tax withholding at the source.

                (b)     Any elective deferral as defined in Code Section
        402(g)(3) (any Employer contributions made on behalf of a Participant to
        the extent not includible in gross income and any Employer contributions
        to purchase an annuity contract under Code Section 403(b) under a salary
        reduction agreement) and any amount which is contributed or deferred by
        the Employer at the election of the Participant and which is not
        includible in gross income of the Participant by reason of Code Section
        125 (Cafeteria Plan), Code Section 457 or 132(f)(4) shall also be
        included in the definition of 415 Compensation.

                (c)     415 Compensation in excess of $210,000 (as indexed)
        shall be disregarded for all Participants. For purposes of this
        sub-section, the $210,000 limit shall be referred to as the "applicable
        limit" for the Plan Year in question. The $210,000 limit shall be
        adjusted for increases in the cost of living in accordance with Section
        401(a)(17)(B) of the Code, effective for the Plan Year which begins
        within the applicable calendar year. For purposes of the applicable
        limit, 415 Compensation shall be prorated over short Plan Years.

        "HIGHLY PAID EMPLOYEE" for any Plan Year means an Employee who, during
either that or the immediately preceding Plan Year was at any time a five
percent owner of the Employer (as defined in Code Section 416(i)(1)) or, during
the immediately preceding Plan Year, had 415 Compensation exceeding $95,000 and
was among the most highly compensated one-fifth of all Employees (the $95,000
amount is adjusted at the same time and in the same manner as under Code Section
415(d), provided, however, the base period is the calendar quarter ending
September 30, 1996). For these purposes, "the most highly compensated one-fifth
of all Employees" shall be determined by taking into account all individuals
working for all related Employer entities described in the definition of
"Service," but excluding any individual who has not completed six months of
Service, who normally works fewer than 17-1/2 hours per week or in fewer than
six months per year, who has not reached age 21, whose employment is covered by
a collective bargaining agreement, or who is a nonresident alien who receives no
earned income from United States sources. The applicable year for which a
determination is being made is called a "determination year" and the preceding
12-month period is called a look-back year.

        "HOURS OF SERVICE" means hours to be credited to an Employee under the
following rules:

                (a)     Each hour for which an Employee is paid or is entitled
        to be paid for services to an Employer is an Hour of Service.

                (b)     Each hour for which an Employee is directly or
        indirectly paid or is entitled to be paid for a period of vacation,
        holidays, illness, disability, lay-off, jury duty, temporary military
        duty, or leave of absence is an Hour of Service. However, except as
        otherwise specifically provided, no more than 501 Hours of Service shall
        be credited for any single continuous period which an Employee performs
        no duties. No more than 501 Hours of Service will be credited under this
        paragraph for any single continuous period (whether or not such period
        occurs in a single computation period). Further, no Hours of Service
        shall be credited on account of payments made solely under a plan
        maintained to comply with worker's compensation, unemployment
        compensation, or disability insurance laws, or to reimburse an Employee
        for medical expenses.

                                      -3-
<PAGE>

                (c)     Each hour for which back pay (ignoring any mitigation of
        damages) is either awarded or agreed to by an Employer is an Hour of
        Service. However, no more than 501 Hours of Service shall be credited
        for any single continuous period during which an Employee would not have
        performed any duties. The same Hours of Service will not be credited
        both under paragraph (a) or (b) as the case may be, and under this
        paragraph (c). These hours will be credited to the employee for the
        computation period or periods to which the award or agreement pertains
        rather than the computation period in which the award agreement or
        payment is made.

                (d)     Hours of Service shall be credited in any one period
        only under one of the foregoing paragraphs (a), (b) and (c); an Employee
        may not get double credit for the same period.

                (e)     If an Employer finds it impractical to count the actual
        Hours of Service for any class or group of non-hourly Employees, each
        Employee in that class or group shall be credited with 45 Hours of
        Service for each weekly pay period in which he has at least one Hour of
        Service. However, an Employee shall be credited only for his normal
        working hours during a paid absence.

                (f)     Hours of Service to be credited on account of a payment
        to an Employee (including back pay) shall be recorded in the period of
        Service for which the payment was made. If the period overlaps two or
        more Plan Years, the Hours of Service credit shall be allocated in
        proportion to the respective portions of the period included in the
        several Plan Years. However, in the case of periods of 31 days or less,
        the Administrator may apply a uniform policy of crediting the Hours of
        Service to either the first Plan Year or the second.

                (g)     In all respects an Employee's Hours of Service shall be
        counted as required by Section 2530.200b-2(b) and (c) of the Department
        of Labor's regulations under Title I of ERISA.

        "INVESTMENT FUND" means that portion of the Trust Fund consisting of
assets other than Stock. Notwithstanding the above, assets from the Investment
Fund may be used to purchase Stock in the open market or otherwise, or used to
pay on the Stock Obligation, and shares so purchased will be allocated to a
Participant's Stock Fund.

        "NORMAL RETIREMENT" means retirement on or after the Participant's
Normal Retirement Date.

        "NORMAL RETIREMENT DATE" means the date on which a Participant attains
age 65.

        "PARTICIPANT" means any Eligible Employee who is an Active Participant
participating in the Plan, or Eligible Employee or former Employee who was
previously an Active Participant and still has a balance credited to his
Account.

        "PLAN YEAR" means the twelve-month period commencing November 1, 2004
and ending October 31, 2005 and each period of 12 consecutive months beginning
on November 1 of each succeeding year.

        "RECOGNIZED ABSENCE" means a period for which --

                (a)     an Employer grants an Employee a leave of absence for a
        limited period, but only if an Employer grants such leave on a
        nondiscriminatory basis; or

                (b)     an Employee is temporarily laid off by an Employer
        because of a change in business conditions; or

                (c)     an Employee is on active military duty, but only to the
        extent that his employment rights are protected by the Military
        Selective Service Act of 1967 (38 U.S.C. Sec. 2021).

                                      -4-
<PAGE>

        "SERVICE" means an Employee's period(s) of employment or self-employment
with an Employer, excluding for initial eligibility purposes any period in which
the individual was a nonresident alien and did not receive from an Employer any
earned income which constituted income from sources within the United States. An
Employee's Service shall include any Service which constitutes Service with a
predecessor Employer within the meaning of Section 414(a) of the Code, provided,
however, that Service with an acquired entity shall not be considered Service
under the Plan unless required by applicable law or agreed to by the parties to
such transaction. An Employee's Service shall also include any Service with an
entity which is not an Employer, but only either (i) for a period after 1975 in
which the other entity is a member of a controlled group of corporations or is
under common control with other trades and businesses within the meaning of
Section 414(b) or 414(c) of the Code, and a member of the controlled group or
one of the trades and businesses is an Employer, (ii) for a period after 1979 in
which the other entity is a member of an affiliated service group within the
meaning of Section 414(m) of the Code, and a member of the affiliated service
group is an Employer, or (iii) all Employers aggregated with the Employer under
Section 414(o) of the Code (but not until the Proposed Regulations under Section
414(o) become effective). Notwithstanding any provision of this Plan to the
contrary, contributions, benefits and service credit with respect to qualified
military service will be provided in accordance with Section 414(u) of the Code.

        "SPOUSE" means the individual, if any, to whom a Participant is lawfully
married on the date benefit payments to the Participant are to begin, or on the
date of the Participant's death, if earlier. A former Spouse shall be treated as
the Spouse or surviving Spouse to the extent provided under a qualified domestic
relations order as described in section 414(p) of the Code.

        "STOCK" means shares of the Company's voting common stock or preferred
stock meeting the requirements of Section 409(e)(3) of the Code issued by an
Employer which is a member of the same controlled group of corporations within
the meaning of Code Section 414(b).

        "STOCK FUND" means that portion of the Trust Fund consisting of Stock.

        "STOCK OBLIGATION" means an indebtedness arising from any extension of
credit to the Plan or the Trust which satisfies the requirements set forth in
Section 6.3 and which was obtained for any or all of the following purposes:

                (i)     to acquire qualifying Employer securities as defined in
                        Treasury Regulations ss.54.4975-12;

                (ii)    to repay such Stock Obligation; or

                (iii)   to repay a prior exempt loan.

        "TRUST" OR "TRUST FUND" means the trust fund created under this Plan.

        "TRUST AGREEMENT" means the agreement between the Bank and the Trustee
concerning the Trust Fund. If any assets of the Trust Fund are held in a
co-mingled trust fund with assets of other qualified retirement plans, "Trust
Agreement" shall be deemed to include the trust agreement governing that
co-mingled trust fund. With respect to the allocation of investment
responsibility for the assets of the Trust Fund, the provisions of Article II of
the Trust Agreement are incorporated herein by reference.

        "TRUSTEE" means one or more corporate persons or individuals selected
from time to time by the Bank to serve as trustee or co-trustees of the Trust
Fund.

                                      -5-
<PAGE>

        "UNALLOCATED STOCK FUND" means that portion of the Stock Fund consisting
of the Plan's holding of Stock which have been acquired in exchange for one or
more Stock Obligations and which have not yet been allocated to the
Participant's Accounts in accordance with Section 4.2.

        "VALUATION DATE" means for so long as there is a generally-recognized
market for the Stock each business day. If at any time there shall be no
generally-recognized market for the Stock, then "Valuation Date" shall mean the
last day of the Plan Year and each other date as of which the Committee shall
determine the investment experience of the Investment Fund and adjust the
Participants' Accounts accordingly.

        "VALUATION PERIOD" means the period following a Valuation Date and
ending with the next Valuation Date.

        "VESTING YEAR" means a unit of Service credited to a Participant
pursuant to Section 9.2 for purposes of determining his vested interest in his
Account.

SECTION 3.      ELIGIBILITY FOR PARTICIPATION.

        3.1     INITIAL ELIGIBILITY. An Eligible Employee shall enter the Plan
as of the Entry Date coincident with or next following the later of the
following dates:

                (a)     the last day of the Eligible Employee's second
        Eligibility Year, and

                (b)     the Eligible Employee's 21st birthday. However, if an
        Eligible Employee is not in active Service with an Employer on the date
        he would otherwise first enter the Plan, his entry shall be deferred
        until the next day he is in Service.

        3.2     DEFINITION OF ELIGIBILITY YEAR. "Eligibility Year" means an
applicable eligibility period (as defined below) in which the Eligible Employee
has completed 1,000 Hours of Service for the Employer. For this purpose, an
Eligible Employee's first "eligibility period" is the 12-consecutive month
period beginning on the first day on which he has an Hour of Service, and
subsequent eligibility periods shall commence on the first anniversary of the
date on which the Employee first completed an Hour of Service for the Employer.

        3.3     TERMINATED EMPLOYEES. No Employee shall have any interest or
rights under this Plan if he is never in active Service with an Employer on or
after the Effective Date.

        3.4     CERTAIN EMPLOYEES INELIGIBLE.

                (a)     No Employee shall participate in the Plan while his
        Service is covered by a collective bargaining agreement between an
        Employer and the Employee's collective bargaining representative if (i)
        retirement benefits have been the subject of good faith bargaining
        between the Employer and the representative and (ii) the collective
        bargaining agreement does not provide for the Employee's participation
        in the Plan.

                (b)     Leased Employees are not eligible to participate in the
        Plan.

                (c)     Employees who are nonresident aliens with no earned
        income (within the meaning of Code Section 911(d)(2)) from the Employer
        which constitutes income from sources within the United States (within
        the meaning of Code Section 861(a)(3)).

                (d)     An Eligible Employee may elect not to participate in the
        Plan, provided, however, such election is made solely to meet the
        requirements of Code Section 409(n). For an election to be

                                      -6-
<PAGE>

        effective for a particular Plan Year, the Eligible Employee or
        Participant must file the election in writing with the Plan
        Administrator no later than the last day of the Plan Year for which the
        election is to be effective. The Employer may not make a contribution
        under the Plan for the Eligible Employee or for the Participant for the
        Plan Year for which the election is effective, nor for any succeeding
        Plan Year, unless the Eligible Employee or Participant re-elects to
        participate in the Plan. The Eligible Employee or Participant may elect
        again not to participate, but not earlier than the first Plan Year
        following the Plan Year in which the re-election was first effective.

        3.5     PARTICIPATION AND REPARTICIPATION. Subject to the satisfaction
of the foregoing requirements, an Eligible Employee shall participate in the
Plan during each period of his Service from the date on which he first becomes
eligible until his termination. For this purpose, an Eligible Employee who
returns before five (5) consecutive Breaks in Service who previously satisfied
the initial eligibility requirements or who returns after five (5) consecutive
one year Breaks in Service with a vested Account balance in the Plan shall
re-enter the Plan as of the date of his return to Service with an Employer.

        3.6     OMISSION OF ELIGIBLE EMPLOYEE. If, in any Plan Year, any
Eligible Employee who should be included as a Participant in the Plan is
erroneously omitted and discovery of such omission is not made until after a
contribution by his Employer for the year has been made, the Employer shall make
a subsequent contribution with respect to the omitted Eligible Employee in the
amount which the said Employer would have contributed regardless of whether or
not it is deductible in whole or in part in any taxable year under applicable
provisions of the Code.

        3.7     INCLUSION OF INELIGIBLE EMPLOYEE. If, in any fiscal year, any
person who should not have been included as a Participant in the Plan is
erroneously included and discovery of such incorrect inclusion is not made until
after a contribution for the year has been made, the Employer shall not be
entitled to recover the contribution made with respect to the ineligible person
regardless of whether or not a deduction is allowable with respect to such
contribution. In such event, the amount contributed with respect to the
ineligible person shall constitute a forfeiture for the fiscal year in which the
discovery is made.

SECTION 4.      CONTRIBUTIONS AND CREDITS.

        4.1     DISCRETIONARY CONTRIBUTIONS. The Employer shall from time to
time contribute, with respect to a Plan Year, such amounts as it may determine
from time to time. The Employer shall have no obligation to contribute any
amount under this Plan except as so determined in its sole discretion. The
Employer's contributions and available forfeitures for a Plan Year shall be
credited as of the last day of the year to the Accounts of the Active
Participants in proportion to their amounts of 415 Compensation earned during
the Limitation Year as such term is defined in Section 5.1-6..

        4.2     CONTRIBUTIONS FOR STOCK OBLIGATIONS. If the Trustee, upon
instructions from the Committee, incurs any Stock Obligation upon the purchase
of Stock, the Employer may contribute for each Plan Year an amount sufficient to
cover all payments of principal and interest as they come due under the terms of
the Stock Obligation. If there is more than one Stock Obligation, the Employer
shall designate the one to which any contribution is to be applied. Investment
earnings realized on Employer contributions and any dividends paid by the
Employer on Stock held in the Unallocated Stock Account, shall be applied to the
Stock Obligation related to that Stock, subject to Section 7.2.

        In each Plan Year in which Employer contributions, earnings on
contributions, or dividends on unallocated Stock are used as payments under a
Stock Obligation, a certain number of shares of the Stock acquired with that
Stock Obligation which is then held in the Unallocated Stock Fund shall be
released for allocation among the Participants. The number of shares released
shall bear the same ratio to the total number of those shares then held in the
Unallocated Stock Fund (prior to the release) as (i) the principal and interest
payments made on the Stock Obligation in the current Plan Year bears to (ii) the
sum of (i) above,

                                      -7-
<PAGE>

and the remaining principal and interest payments required (or projected to be
required on the basis of the interest rate in effect at the end of the Plan
Year) to satisfy the Stock Obligation.

        At the direction of the Committee, the current and projected payments of
interest under a Stock Obligation may be ignored in calculating the number of
shares to be released in each year if (i) the Stock Obligation provides for
annual payments of principal and interest at a cumulative rate that is not less
rapid at any time than level annual payments of such amounts for 10 years, (ii)
the interest included in any payment is ignored only to the extent that it would
be determined to be interest under standard loan amortization tables, and (iii)
the term of the Stock Obligation, by reason of renewal, extension, or
refinancing, has not exceeded 10 years from the original acquisition of the
Stock.

        4.3     CONDITIONS AS TO CONTRIBUTIONS. Employers' contributions shall
in all events be subject to the limitations set forth in Section 5.
Contributions may be made in the form of cash, or securities and other property
to the extent permissible under ERISA, including Stock, and shall be held by the
Trustee in accordance with the Trust Agreement. In addition to the provisions of
Section 13.3 for the return of an Employer's contributions in connection with a
failure of the Plan to qualify initially under the Code, any amount contributed
by an Employer due to a good faith mistake of fact, or based upon a good faith
but erroneous determination of its deductibility under Section 404 of the Code,
shall be returned to the Employer within one year after the date on which the
contribution was originally made, or within one year after its nondeductibility
has been finally determined. However, the amount to be returned shall be reduced
to take account of any adverse investment experience within the Trust Fund in
order that the balance credited to each Participant's Account is not less that
it would have been if the contribution had never been made.

        4.4     ROLLOVER CONTRIBUTIONS. This Plan shall not accept a direct
rollover or rollover contribution of an "eligible rollover distribution" as such
term is defined in Section 10.9-1 of the Plan.

SECTION 5.      LIMITATIONS ON CONTRIBUTIONS AND ALLOCATIONS.

        5.1     LIMITATION ON ANNUAL ADDITIONS. Notwithstanding anything herein
to the contrary, allocation of Employer contributions for any Plan Year shall be
subject to the following:

                5.1-1   If allocation of Employer contributions in accordance
        with Section 4.1 will result in an allocation of more than one-third the
        total contributions for a Plan Year to the Accounts of Highly Paid
        Employees, then allocation of such amount shall be adjusted so that such
        excess will not occur.

                5.1-2   After adjustment, if any, required by the preceding
        paragraph, the annual additions during any Plan Year to any
        Participant's Account under this and any other defined contribution
        plans maintained by the Employer or an affiliate (within the purview of
        Section 414(b), (c) and (m) and Section 415(h) of the Code, which
        affiliate shall be deemed the Employer for this purpose) shall not
        exceed the lesser of $40,000 (or such other dollar amount which results
        from cost-of-living adjustments under Section 415(d) of the Code) (the
        "dollar limitation") or 100 percent of the Participant's 415
        Compensation for such limitation year (the "percentage limitation"). The
        percentage limitation shall not apply to any contribution for medical
        benefits after separation from service (within the meaning of Section
        401(h) or Section 419A(f)(2) of the Code) which is otherwise treated as
        an annual addition. If, as a result of the allocation of forfeitures, a
        reasonable error in estimating a Participant's annual compensation, a
        reasonable error in determining the amount of elective deferrals (within
        the meaning of Code Section 402(g)(3)) that may be made with respect to
        any individual under the limits of Code Section 415, or under other
        limited facts and circumstances that the Commissioner of the Internal
        Revenue Service finds justify the availability of the rules set forth in
        this paragraph, the annual additions under the terms of the Plan for a
        particular Participant would cause the limitations of Code Section 415
        applicable to that Participant for the limitation year to be exceeded,
        the excess amounts shall not be deemed annual additions in that
        limitation year if they are treated in accordance with any one of the
        following:

                                      -8-
<PAGE>

                (i)     Any excess amount at the end of the Plan Year that
        cannot be allocated to the Participant's Account shall be reallocated to
        the remaining Participants who are eligible for an allocation of
        Employer contributions for the Plan Year. The reallocation shall be made
        in accordance with Section 4.1 of the Plan as if the Participant whose
        Account otherwise would receive the excess amount is not eligible for an
        allocation of Employer contributions.

                (ii)    If the allocation or reallocation of the excess amounts
        causes the limitations of Code section 415 to be exceeded with respect
        to each Participant for the limitation year, then the excess amount will
        be held unallocated in a suspense account. The suspense account will be
        applied to reduce future Employer contributions for all remaining
        Participants in the next limitation year and each succeeding limitation
        year if necessary.

                (iii)   If a suspense account is in existence at any time during
        a limitation year, it will not participate in any allocation of
        investment gains and losses. All amounts held in suspense accounts must
        be allocated to Participants' Accounts before any contributions may be
        made to the Plan for the limitation year.

                (iv)    If a suspense account exists at the time of Plan
        termination, amounts held in the suspense account that cannot be
        allocated shall revert to the Employer.

                5.1-3   For purposes of this Section 5.1, the "annual addition"
        to a Participant's Accounts means the sum of (i) Employer contributions,
        (ii) Employee contributions, if any, and (iii) forfeitures. Annual
        additions to a defined contribution plan also include amounts allocated,
        after March 31, 1984, to an individual medical account, as defined in
        Section 415(l)(2) of the Internal Revenue Code, which is part of a
        pension or annuity plan maintained by the Employer, amounts derived from
        contributions paid or accrued after December 31, 1985, in taxable years
        ending after such date, which are attributable to post-retirement
        medical benefits allocated to the separate account of a Key Employee
        under a welfare benefit fund, as defined in Section 419A(d) of the
        Internal Revenue Code, maintained by the Employer. For these purposes,
        annual additions to a defined contribution plan shall not include the
        allocation of the excess amounts remaining in the Unallocated Stock Fund
        subsequent to a sale of stock from such fund in accordance with a
        transaction described in Section 8.1 of the Plan.

                5.1-4   Notwithstanding the foregoing, if no more than one-third
        of the Employer contributions to the Plan for a year which are
        deductible under Section 404(a)(9) of the Code are allocated to Highly
        Paid Employees (within the meaning of Section 414(q) of the Internal
        Revenue Code), the limitations imposed herein shall not apply to:

                (i)     forfeitures of Employer securities (within the meaning
        of Section 409 of the Code) under the Plan if such securities were
        acquired with the proceeds of a loan described in Section 404(a)(9)(A)
        of the Code), or

                (ii)    Employer contributions to the Plan which are deductible
        under Section 404(a)(9)(B) and charged against a Participant's Account.

                5.1-5   If the Employer contributes amounts, on behalf of
        Eligible Employees covered by this Plan, to other "defined contribution
        plans" as defined in Section 3(34) of ERISA, the limitation on annual
        additions provided in this Section shall be applied to annual additions
        in the aggregate to this Plan and to such other plans. Reduction of
        annual additions, where required, shall be accomplished first by
        reductions under such other plan pursuant to the directions of the named
        fiduciary for administration of such other plans or under priorities, if
        any, established under the

                                      -9-
<PAGE>

        terms of such other plans and then by allocating any remaining excess
        for this Plan in the manner and priority set out above with respect to
        this Plan.

                5.1-6   A limitation year shall mean each 12 consecutive month
        period ending on December 31 within the Plan Year.

        5.2     EFFECT OF LIMITATIONS. The Committee shall take whatever action
may be necessary from time to time to assure compliance with the limitations set
forth in Section 5.1. Specifically, the Committee shall see that each Employer
restrict its contributions for any Plan Year to an amount which, taking into
account the amount of available forfeitures, may be completely allocated to the
Participants consistent with those limitations. Where the limitations would
otherwise be exceeded by any Participant, further allocations to the Participant
shall be curtailed to the extent necessary to satisfy the limitations. Where an
excessive amount is contributed on account of a mistake as to one or more
Participants' compensation, or there is an amount of forfeitures which may not
be credited in the Plan Year in which it becomes available, the amount shall be
corrected in accordance with Section 5.1-2 of the Plan. If it is determined at
any time that the Committee and/or Trustee has erred in accepting and allocating
any contributions or forfeitures under this Plan, or in allocating net gain or
loss pursuant to Sections 8.2 and 8.3, then the Committee, in a uniform and
nondiscriminatory manner, shall determine the manner in which such error shall
be corrected and shall promptly advise the Trustee in writing of such error and
of the method for correcting such error. The Accounts of any or all Participants
may be revised, if necessary, in order to correct such error.

        5.3     LIMITATIONS AS TO CERTAIN PARTICIPANTS. Aside from the
limitations set forth in Section 5.1, if the Plan acquires any Stock in a
transaction as to which a selling shareholder or the estate of a deceased
shareholder is claiming the benefit of Section 1042 of the Code, the Committee
shall see that none of such Stock, and no other assets in lieu of such Stock,
are allocated to the Accounts of certain Participants in order to comply with
Section 409(n) of the Code.

        This restriction shall apply at all times to a Participant who owns
(taking into account the attribution rules under Section 318(a) of the Code,
without regard to the exception for employee plan trusts in Section
318(a)(2)(B)(i) more than 25 percent of any class of stock of a corporation
which issued the Stock acquired by the Plan, or another corporation within the
same controlled group, as defined in Section 409(l)(4) of the Code (any such
class of stock hereafter called a "Related Class"). For this purpose, a
Participant who owns more than 25 percent of any Related Class at any time
within the one year preceding the Plan's purchase of the Stock shall be subject
to the restriction as to all allocations of the Stock, but any other Participant
shall be subject to the restriction only as to allocations which occur at a time
when he owns more than 25 percent of any Related Class.

        Further, this restriction shall apply to the selling shareholder
claiming the benefit of Section 1042 and any other Participant who is related to
such a shareholder within the meaning of Section 267(b) of the Code, during the
period beginning on the date of sale and ending on the later of (1) the date
that is ten years after the date of sale, or (2) the date of the Plan allocation
attributable to the final payment of acquisition indebtedness incurred in
connection with the sale.

        This restriction shall not apply to any Participant who is a lineal
descendant of a selling shareholder if the aggregate amounts allocated under the
Plan for the benefit of all such descendants do not exceed five percent of the
Stock acquired from the shareholder.

        5.4     ERRONEOUS ALLOCATIONS. No Participant shall be entitled to any
annual additions or other allocations to his Account in excess of those
permitted under Section 5. If it is determined at any time that the
administrator and/or Trustee have erred in accepting and allocating any
contributions or forfeitures under this Plan, or in allocating investment
adjustments, or in excluding or including any person as a Participant, then the
administrator, in a uniform and nondiscriminatory manner, shall determine the
manner in which such error shall be corrected and shall promptly advise the
Trustee in writing of such error and of the

                                      -10-
<PAGE>

method for correcting such error. The Accounts of any or all Participants may be
revised, if necessary, in order to correct such error.

        SECTION 6.       TRUST FUND AND ITS INVESTMENT.

        6.1     CREATION OF TRUST FUND. All amounts received under the Plan from
Employers and investments shall be held as the Trust Fund pursuant to the terms
of this Plan and of the Trust Agreement between the Bank and the Trustee. The
benefits described in this Plan shall be payable only from the assets of the
Trust Fund, and none of the Bank, any other Employer, its board of directors or
trustees, its stockholders, its officers, its employees, the Committee, and the
Trustee shall be liable for payment of any benefit under this Plan except from
the Trust Fund.

        6.2     STOCK FUND AND INVESTMENT FUND. The Trust Fund held by the
Trustee shall be divided into the Stock Fund, consisting entirely of Stock, and
the Investment Fund, consisting of all assets of the Trust other than Stock. The
Trustee shall have no investment responsibility for the Stock Fund, but shall
accept any Employer contributions made in the form of Stock, and shall acquire,
sell, exchange, distribute, and otherwise deal with and dispose of Stock in
accordance with the instructions of the Committee. The Trustee shall have full
responsibility for the investment of the Investment Fund, except to the extent
such responsibility may be delegated from time to time to one or more investment
managers pursuant to Section 2.3 of the Trust Agreement, or to the extent the
Committee directs the Trustee to purchase Stock with the assets in the
Investment Fund.

        6.3     ACQUISITION OF STOCK. From time to time the Committee may, in
its sole discretion, direct the Trustee to acquire Stock from the issuing
Employer or from shareholders, including shareholders who are or have been
Employees, Participants, or fiduciaries with respect to the Plan. The Trustee
shall pay for such Stock no more than its fair market value, which shall be
determined conclusively by the Committee pursuant to Section 12.4. The Committee
may direct the Trustee to finance the acquisition of Stock by incurring or
assuming indebtedness to the seller or another party which indebtedness shall be
called a "Stock Obligation." The term "Stock Obligation" shall refer to a loan
made to the Plan by a disqualified person within the meaning of Section
4975(e)(2) of the Code, or a loan to the Plan which is guaranteed by a
disqualified person. A Stock Obligation includes a direct loan of cash, a
purchase-money transaction, and an assumption of an obligation of a
tax-qualified employee stock ownership plan under Section 4975(e)(7) of the Code
("ESOP"). For these purposes, the term "guarantee" shall include an unsecured
guarantee and the use of assets of a disqualified person as collateral for a
loan, even though the use of assets may not be a guarantee under applicable
state law. An amendment of a Stock Obligation in order to qualify as an "exempt
loan" is not a refinancing of the Stock Obligation or the making of another
Stock Obligation. The term "exempt loan" refers to a loan that satisfies the
provisions of this paragraph. A "non-exempt loan" fails to satisfy this
paragraph. Any Stock Obligation shall be subject to the following conditions and
limitations:

                6.3-1   A Stock Obligation shall be for a specific term, shall
        not be payable on demand except in the event of default, and shall bear
        a reasonable rate of interest.

                6.3-2   A Stock Obligation may, but need not, be secured by a
        collateral pledge of either the Stock acquired in exchange for the Stock
        Obligation, or the Stock previously pledged in connection with a prior
        Stock Obligation which is being repaid with the proceeds of the current
        Stock Obligation. No other assets of the Plan and Trust may be used as
        collateral for a Stock Obligation, and no creditor under a Stock
        Obligation shall have any right or recourse to any Plan and Trust assets
        other than Stock remaining subject to a collateral pledge.

                6.3-3   Any pledge of Stock to secure a Stock Obligation must
        provide for the release of pledged Stock in connection with payments on
        the Stock obligations in the ratio prescribed in Section 4.2.

                                      -11-
<PAGE>

                6.3-4   Repayments of principal and interest on any Stock
        Obligation shall be made by the Trustee only from Employer cash
        contributions designated for such payments, from earnings on such
        contributions, and from cash dividends received on Stock, in the last
        case, however, subject to the further requirements of Section 7.2.

                6.3-5   In the event of default of a Stock Obligation, the value
        of Plan assets transferred in satisfaction of the Stock Obligation must
        not exceed the amount of the default. If the lender is a disqualified
        person within the meaning of Section 4975 of the Code, a Stock
        Obligation must provide for a transfer of Plan assets upon default only
        upon and to the extent of the failure of the Plan to meet the payment
        schedule of said Stock Obligation. For purposes of this paragraph, the
        making of a guarantee does not make a person a lender.

        6.4     PARTICIPANTS' OPTION TO DIVERSIFY. The Committee shall provide
for a procedure under which each Participant may, during the qualified election
period, elect to "diversify" a portion of the Employer Stock allocated to his
Account, as provided in Section 401(a)(28)(B) of the Code. An election to
diversify must be made on the prescribed form and filed with the Committee
within the period specified herein. For each of the first five (5) Plan years in
the qualified election period, the Participant may elect to diversify an amount
which does not exceed 25% of the number of shares allocated to his Account since
the inception of the Plan, less all shares with respect to which an election
under this Section has already been made. For the last year of the qualified
election period, the Participant may elect to have up to 50 percent of the value
of his Account committed to other investments, less all shares with respect to
which an election under this Section has already been made. The term "qualified
election period" shall mean the six (6) Plan Year period beginning with the
first Plan Year in which a Participant has both attained age 55 and completed 10
years of participation in the Plan. A Participant's election to diversify his
Account may be made within each year of the qualified election period and shall
continue for the 90-day period immediately following the last day of each year
in the qualified election period. Once a Participant makes such election, the
Plan must complete diversification in accordance with such election within 90
days after the end of the period during which the election could be made for the
Plan Year. In the discretion of the Committee, the Plan may satisfy the
diversification requirement by any of the following methods:

                6.4-1   The Plan may distribute all or part of the amount
        subject to the diversification election.

                6.4-2   The Plan may offer the Participant at least three other
        distinct investment options, if available under the Plan. The other
        investment options shall satisfy the requirements of Regulations under
        Section 404(c) of the Employee Retirement Income Security Act of 1974,
        as amended ("ERISA").

                6.4-3   The Plan may transfer the portion of the Participant's
        Account subject to the diversification election to another qualified
        defined contribution plan of the Employer that offers at least three
        investment options satisfying the requirements of the Regulations under
        Section 404(c) of ERISA.

SECTION 7.      VOTING RIGHTS AND DIVIDENDS ON STOCK.

        7.1     VOTING AND TENDERING OF STOCK. The Trustee generally shall vote
all shares of Stock held under the Plan in accordance with the written
instructions of the Committee. However, if any Employer has registration-type
class of securities within the meaning of Section 409(e)(4) of the Code, or if a
matter submitted to the holders of the Stock involves a merger, consolidation,
recapitalization, reclassification, liquidation, dissolution, or sale of
substantially all assets of an entity, then (i) the shares of Stock which have
been allocated to Participants' Accounts shall be voted by the Trustee in
accordance with the Participants' written instructions, and (ii) the Trustee
shall vote any unallocated Stock and allocated Stock for which it has

                                      -12-
<PAGE>

received no voting instructions in the same proportions as it votes the
allocated Stock for which it has received instructions from Participants;
provided, however, that if an exempt loan, as defined in Section 4975(d) of the
Code, is outstanding and the Plan is in default on such exempt loan, as default
is defined in the loan documents, then to the extent that such loan documents
require the lender to exercise voting rights with respect to the unallocated
shares, the loan documents will prevail. In the event no shares of Stock have
been allocated to Participants' Accounts at the time Stock is to be voted and
any exempt loan which may be outstanding is not in default, each Participant
shall be deemed to have one share of Stock allocated to his or her Account for
the sole purpose of providing the Trustee with voting instructions.

        Notwithstanding any provision hereunder to the contrary, all unallocated
shares of Stock must be voted by the Trustee in a manner determined by the
Trustee to be for the exclusive benefit of the Participants and Beneficiaries.
Whenever such voting rights are to be exercised, the Employers shall provide the
Trustee, in a timely manner, with the same notices and other materials as are
provided to other holders of the Stock, which the Trustee shall distribute to
the Participants. The Participants shall be provided with adequate opportunity
to deliver their instructions to the Trustee regarding the voting of Stock
allocated to their Accounts. The instructions of the Participants' with respect
to the voting of allocated shares hereunder shall be confidential.

                7.1-1   In the event of a tender offer, Stock shall be tendered
        by the Trustee in the same manner as set forth above with respect to the
        voting of Stock. Notwithstanding any provision hereunder to the
        contrary, Stock must be tendered by the Trustee in a manner determined
        by the Trustee to be for the exclusive benefit of the Participants and
        Beneficiaries.

        7.2     DIVIDENDS ON STOCK. Dividends on Stock which are received by the
Trustee in the form of additional Stock shall be retained in the Stock Fund, and
shall be allocated among the Participant's Accounts and the Unallocated Stock
Fund in accordance with their holdings of the Stock on which the dividends have
been paid. Dividends on Stock credited to Participants' Accounts which are
received by the Trustee in the form of cash shall, at the direction of the
Employer paying the dividends, either (i) be credited to the Accounts in
accordance with Section 8.3 and invested as part of the Investment Fund, (ii) be
distributed immediately to the Participants in proportion with the Participants'
Stock Fund Account balance (iii) be distributed to the Participants within 90
days of the close of the Plan Year in which paid in proportion with the
Participants' Stock Fund Account balance or (iv) be used to make payments on the
Stock Obligation. If dividends on Stock allocated to a Participant's Account are
used to repay the Stock Obligation, Stock with a fair market value equal to the
dividends so used must be allocated to such Participant's Account in lieu of the
dividends. Dividends on Stock held in the Unallocated Stock Fund which are
received by the Trustee in the form of cash shall be allocated to Participants'
Investment Fund Accounts (pro rata based on the Participant's Account balance in
relation to all Participants' Account balances) and shall be applied as soon as
practicable to payments of principal and interest under the Stock Obligation
incurred with the purchase of the Stock.

SECTION 8.      ADJUSTMENTS TO ACCOUNTS.

        8.1     ALLOCATIONS

                (a)     ELIGIBILITY. Subject to the provisions of Section 5, as
of the last day of each Plan Year, the Employer's contributions for that year,
the shares of Stock that are released from the Unallocated Stock Fund during
that year, and the forfeitures arising under the Plan during that year shall be
allocated among the Accounts of Active Participants and the Accounts of
Participants who have terminated during the Plan Year due to Disability, death,
or Normal Retirement.

                (b)     ALLOCATION FORMULA. The portion of the Company's
contribution for any Plan Year that is not used to pay down a Stock Obligation,
the shares of Stock released from the suspense account during that year by
reason of Employer contributions, and forfeitures arising under the Plan during
that year shall be allocated to the eligible Participants in the proportion that
each Participant's 415 Compensation for that year bears to all Participants'
Compensation for that year.

                                      -13-
<PAGE>

        8.2     CHARGES TO ACCOUNTS When a Valuation Date occurs, any
distributions made to or on behalf of any Participant or Beneficiary since the
last preceding Valuation Date shall be charged to the proper Accounts maintained
for that Participant or Beneficiary.

        8.3     STOCK FUND ACCOUNT Subject to the provisions of Sections 5 and
8.1, as of the last day of each Plan Year, the Trustee shall credit to each
Participant's Stock Fund Account: (a) the Participant's allocable share of Stock
purchased by the Trustee or contributed by the Employer to the Trust Fund for
that year; (b) the Participant's allocable share of the Stock that is released
from the Unallocated Stock Fund for that year; (c) the Participant's allocable
share of any forfeitures of Stock arising under the Plan during that year; and
(d) any stock dividends declared and paid during that year on Stock credited to
the Participant's Stock Fund Account.

        If, in any Plan Year during which an outstanding Stock Obligation
exists, the Employer directs the Trustee to Sell or otherwise dispose of a
number of Shares of Stock in the Unallocated Stock Fund sufficient to repay, in
its entirety, the Stock Obligations, and following such repayment, there remains
Stock or other assets in the Unallocated Stock Fund, such Stock or other assets
shall be allocated as of the last day of the Plan Year in which the repayment
occurred as earnings of the Plan in accordance with Section 8.5.

        8.4     INVESTMENT FUND ACCOUNT. Subject to the provisions of Sections 5
and 8.1 as of the last day of each Plan Year, the Trustee shall credit to each
Participant's Investment Fund Account: (a) the Participant's allocable share of
any contribution for that year made by the Employer in cash or in property other
than Stock that is not used by the Trustee to purchase Employer Stock or to make
payments due under a Stock Obligation; (b) the Participant's allocable share of
any forfeitures from the Investment Fund Accounts of other Participants arising
under the Plan during that year; (c) any cash dividends paid during that year on
Stock credited to the Participant's Stock Fund Account, other than dividends
which are paid directly to the Participant and other than dividends which are
used to repay Stock Obligation; and (d) the share of the net income or loss of
the Trust Fund properly allocable to that Participant's Investment Fund Account,
as provided in Section 8.5.

        8.5     ADJUSTMENT TO VALUE OF TRUST FUND As of the last day of each
Plan Year, the Trustee shall determine: (i) the net worth of that portion of the
Trust Fund which consists of properties other than Stock (the "Investment
Fund"); and (ii) the increase or decrease in the net worth of the Investment
Fund since the last day of the preceding Plan Year. The net worth of the
Investment Fund shall be the fair market value of all properties held by the
Trustee under the Trust Agreement other than Stock, net of liabilities other
than liabilities to Participants and their beneficiaries. The Trustee shall
allocate to the Investment Fund Account of each Participant that percentage of
the increase or decrease in the net worth of the Investment Fund equal to the
ratio which the balances credited to the Participant's Investment Fund Account
bear to the total amount credited to all Participants' Investments Fund
Accounts. This allocation shall be made after application of Section 7-2, but
before application of Sections 8.1, 8.4 and 5.1.

        8.6     PARTICIPANT STATEMENTS Each Plan Year, the Trustee will provide
each Participant with a statement of his or her Account balances as of the last
day of the Plan Year.

SECTION 9.      VESTING OF PARTICIPANTS' INTERESTS.

        9.1     DEFERRED VESTING IN ACCOUNTS. To the extent that Section 3.1
requires that an Employee complete two Eligibility Years of service in order to
participate in the plan, a participant shall be fully vested in his Account upon
entry into the plan.

        9.2     COMPUTATION OF VESTING YEARS. For purposes of this Plan, a
"Vesting Year" means generally a Plan Year in which an Eligible Employee has at
least 1,000 Hours of Service, beginning with the first Plan Year in which the
Eligible Employee has completed an Hour of Service with the Employer, and

                                      -14-
<PAGE>

including Service with other Employers as provided in the definition of
"Service." Notwithstanding the above, an Eligible Employee who was employed with
the Bank in its pre-conversion mutual form (the "Mutual Bank") shall receive
credit for vesting purposes for each calendar year of continuous employment with
the Mutual Bank in which such Eligible Employee completed 1,000 Hours of Service
(such years shall also be referred to as "Vesting Years"). However, a
Participant's Vesting Years shall be computed subject to the following
conditions and qualifications:

                9.2-1   A Participant's Vesting Years shall not include any
        Service prior to the date on which an Eligible Employee attains age 18.

                9.2-2   To the extent applicable, a Participant's vested
        interest in his Account accumulated before five (5) consecutive Breaks
        in Service shall be determined without regard to any Service after such
        five consecutive Breaks in Service. Further, if a Participant has five
        (5) consecutive Breaks in Service before his interest in his Account has
        become vested to some extent, pre-Break years of Service shall not be
        required to be taken into account for purposes of determining his
        post-Break vested percentage.

                9.2-3   To the extent applicable, in the case of a Participant
        who has 5 or more consecutive 1-year Breaks in Service, the
        Participant's pre-Break Service will count in vesting of the
        Employer-derived post-break accrued benefit only if either:

                (i)     such Participant has any nonforfeitable interest in the
        accrued benefit attributable to Employer contributions at the time of
        separation from Service, or

                (ii)    upon returning to Service the number of consecutive
        1-year Breaks in Service is less than the number of years of Service.

                9.2-4   Notwithstanding any provision of the Plan to the
        contrary, effective January 1, 1998, calculation of service for
        determining Vesting Years with respect to qualified military service
        will be provided in accordance with Section 414(u) of the Code.

                9.2-5   To the extent applicable, if any amendment changes the
        vesting schedule, including an automatic change to or from a top-heavy
        vesting schedule, any Participant with three (3) or more Vesting Years
        may, by filing a written request with the Employer, elect to have his
        vested percentage computed under the vesting schedule in effect prior to
        the amendment. The election period must begin not later than the later
        of sixty (60) days after the amendment is adopted, the amendment becomes
        effective, or the Participant is issued written notice of the amendment
        by the Employer or the Committee.

        9.3     FULL VESTING UPON CERTAIN EVENTS.

                9.3-1   Notwithstanding Section 9.1, a Participant's interest in
        his Account shall fully vest on the Participant's Normal Retirement
        Date. The Participant's interest shall also fully vest in the event that
        his Service is terminated by Disability or by death.

                9.3-2   The Participant's interest in his Account shall also
        fully vest in the event of a "Change in Control" of the Bank or the
        Company. For these purposes, "Change in Control" shall mean a change in
        control of a nature that: (i) would be required to be reported in
        response to Item 5.01 of the current report on Form 8-K, as in effect on
        the date hereof, pursuant to Section 13 or 15(d) of the Securities
        Exchange Act of 1934 (the "Exchange Act"); or (ii) results in a Change
        in Control of the Bank or the Company within the meaning of the Home
        Owners Loan Act, as amended ("HOLA"), and applicable rules and
        regulations promulgated thereunder, as in effect at the time of the
        Change in Control; or (iii) without limitation such a Change in Control
        shall be deemed

                                      -15-
<PAGE>

        to have occurred at such time as (a) any "person" (as the term is used
        in Sections 13(d) and 14(d) of the Exchange Act) is or becomes the
        "beneficial owner"(as defined in Rule 13d-3 under the Exchange Act),
        directly or indirectly, of securities of the Company representing 25% or
        more of the combined voting power of Company's outstanding securities
        except for any securities purchased by the Bank's employee stock
        ownership plan or trust; or (b) individuals who constitute the Board on
        the date hereof (the "Incumbent Board") cease for any reason to
        constitute at least a majority thereof, PROVIDED that any person
        becoming a director subsequent to the date hereof whose election was
        approved by a vote of at least three-quarters of the directors
        comprising the Incumbent Board, or whose nomination for election by the
        Company's stockholders was approved by the same Nominating Committee
        serving under an Incumbent Board, shall be, for purposes of this clause
        (b), considered as though he were a member of the Incumbent Board; or
        (c) a plan of reorganization, merger, consolidation, sale of all or
        substantially all the assets of the Bank or the Company or similar
        transaction in which the Bank or Company is not the surviving
        institution occurs; or (d) a proxy statement soliciting proxies from
        stockholders of the Company, by someone other than the current
        management of the Company, seeking stockholder approval of a plan of
        reorganization, merger or consolidation of the Company or similar
        transaction with one or more corporations as a result of which the
        outstanding shares of the class of securities then subject to the Plan
        are to be exchanged for or converted into cash or property or securities
        not issued by the Company; or (e) a tender offer is made for 25% or more
        of the voting securities of the Company and the shareholders owning
        beneficially or of record 25% or more of the outstanding securities of
        the Company have tendered or offered to sell their shares pursuant to
        such tender offer and such tendered shares have been accepted by the
        tender offeror.

                9.3-3   Upon a Change in Control described in 9.3-2, the Plan
        shall be terminated and the Plan Administrator shall direct the Trustee
        to sell a sufficient amount of Stock from the Unallocated Stock Fund to
        repay any outstanding Stock Obligation in full. The proceeds of such
        sale shall be used to repay such Stock Obligation. After repayment of
        the Stock Obligation, all remaining shares in the Unallocated Stock Fund
        (or the proceeds thereof, if applicable) shall be deemed to be earnings
        and shall be allocated in accordance with the requirements of Section
        8.1.

        9.4     FULL VESTING UPON PLAN TERMINATION. Notwithstanding Section 9.1,
a Participant's interest in his Account shall fully vest upon termination of
this Plan or upon the permanent and complete discontinuance of contributions by
his Employer. In the event of a partial termination, the interest of each
affected Participant shall fully vest with respect to that part of the Plan
which is terminated.

        9.5     FORFEITURE, REPAYMENT, AND RESTORAL. If a Participant's Service
terminates before his interest in his Account is fully vested, that portion
which has not vested shall be forfeited if he either (i) receives a distribution
of his entire vested interest pursuant to Section 10.1, or (ii) incurs a
one-year Break in Service. If a Participant's Service terminates prior to having
any portion of his Account become vested, such Participant shall be deemed to
have received a distribution of his vested interest immediately upon his
termination of Service.

        If a Participant who has suffered a forfeiture of the nonvested portion
of his Account returns to Service before he has five (5) consecutive Breaks in
Service, the nonvested portion shall be restored, provided that, if the
Participant had received a distribution of his vested Account balance, the
amount distributed shall be repaid prior to such restoral. The Participant may
repay such amount at any time within five years after he has returned to
Service. The amount repaid shall be credited to his Account at the time it is
repaid; an additional amount equal to that portion of his Account which was
previously forfeited shall be restored to his Account at the same time from
other Employees' forfeitures and, if such forfeitures are insufficient, from a
special contribution by his Employer for that year. If the Participant did not
receive a distribution of his vested Account balance, any forfeiture restored
shall include earnings that would have been credited to the Account but for the
forfeiture. A Participant who was deemed to have received a

                                      -16-
<PAGE>

distribution of his vested interest in the Plan shall have his Account restored
as of the first day on which he performs an Hour of Service after his return.

        9.6     ACCOUNTING FOR FORFEITURES. If a portion of a Participant's
Account is forfeited, Stock allocated to said Participant's Account shall be
forfeited only after other assets are forfeited. If interests in more than one
class of Stock have been allocated to a Participant's Account, the Participant
must be treated as forfeiting the same proportion of each class of Stock. A
forfeiture shall be charged to the Participant's Account as of the first day of
the first Valuation Period in which the forfeiture becomes certain pursuant to
Section 9.5. Except as otherwise provided in that Section, a forfeiture shall be
added to the contributions of the terminated Participant's Employer which are to
be credited to other Participants pursuant to Section 4.1 as of the last day of
the Plan Year in which the forfeiture becomes certain.

        9.7     VESTING AND NONFORFEITABILITY. A Participant's interest in his
Account which has become vested shall be nonforfeitable for any reason.

SECTION 10.     PAYMENT OF BENEFITS.

        10.1    BENEFITS FOR PARTICIPANTS. For a Participant whose Service ends
for any reason, distribution will be made to or for the benefit of the
Participant or, in the case of the Participant's death, his Beneficiary, by
either, or a combination of the following methods:

                10.1-1  By payment in a lump sum, in accordance with Section
        10.2; or

                10.1-2  By payment in a series of substantially equal annual
        installments over a period not to exceed five (5) years, provided the
        maximum period over which the distribution of a Participant's Account
        may be made shall be extended by 1 year, up to five (5) additional
        years, for each $170,000 (or fraction thereof) by which such
        Participant's Account balance exceeds $850,000 (the aforementioned
        figures are subject to cost-of-living adjustments prescribed by the
        Secretary of the Treasury pursuant to Section 409(o)(2) of the Code).

        The Participant shall elect the manner in which his vested Account
        balance will be distributed to him. If a Participant so desires, he may
        direct how his benefits are to be paid to his Beneficiary. If a deceased
        Participant did not file a direction with the Committee, the
        Participant's benefits shall be distributed to his Beneficiary in a lump
        sum. Notwithstanding any provision to the contrary, if the value of a
        Participant's vested Account balance at the time of any distribution,
        does not equal or exceed $5,000, then such Participant's vested Account
        shall be distributed in a lump sum within 60 days after the end of the
        Plan Year in which employment terminates. If the value of a
        Participant's vested Account balance is, or has ever been, in excess of
        $5,000, then his benefits shall not be paid prior to the later of the
        time he has attained Normal Retirement or age 62 unless he elects an
        early payment date in a written election filed with the Committee. A
        Participant may modify such an election at any time, provided any new
        benefit payment date is at least 30 days after a modified election is
        delivered to the Committee. Failure of a Participant to consent to a
        distribution prior to the later of Normal Retirement or age 62 shall be
        deemed to be an election to defer commencement of payment of any benefit
        under this section.

        10.2    TIME FOR DISTRIBUTION.

                10.2-1  If the Participant and, if applicable, with the consent
        of the Participant's spouse, elects the distribution of the
        Participant's Account balance in the Plan, distribution shall commence
        as soon as practicable following his termination of Service, but no
        later than one year after the close of the Plan Year:

                                      -17-
<PAGE>

                (i)     in which the Participant separates from service by
        reason of attainment of Normal Retirement Age under the Plan,
        Disability, or death; or

                (ii)    which is the fifth Plan Year following the year in which
        the Participant resigns or is dismissed, unless he is reemployed before
        such date.

                10.2-2  Unless the Participant elects otherwise, the
        distribution of the balance of a Participant's Account shall commence
        not later than the 60th day after the latest of the close of the Plan
        Year in which -

                (i)     the Participant attains the age of 65;

                (ii)    occurs the tenth anniversary of the year in which the
        Participant commenced participation in the Plan; or

                (iii)   the Participant terminates his Service with the
        Employer.

                10.2-3  Notwithstanding anything to the contrary, (1) with
        respect to a 5-percent owner (as defined in Code Section 416),
        distribution of a Participant's Account shall commence (whether or not
        he remains in the employ of the Employer) not later than the April 1 of
        the calendar year next following the calendar year in which the
        Participant attains age 70 1/2, and (2) with respect to all other
        Participants, payment of a Participant's benefit will commence not later
        than April 1 of the calendar year following the calendar year in which
        the Participant attains age 70 1/2, or, if later, the year in which the
        Participant retires. A Participant's benefit from that portion of his
        Account committed to the Investment Fund shall be calculated on the
        basis of the most recent Valuation Date before the date of payment.

                10.2-4  Distribution of a Participant's Account balance after
        his death shall comply with the following requirements:

                (i)     If a Participant dies before his distributions have
        commenced, distribution of his Account to his Beneficiary shall commence
        not later than one year after the end of the Plan Year in which the
        Participant died; however, if the Participant's Beneficiary is his
        surviving Spouse, distributions may commence on the date on which the
        Participant would have attained age 70 1/2. In either case,
        distributions shall be completed within five years after they commence.

                (ii)    If the Participant dies after distribution has commenced
        pursuant to Section 10.1.2 but before his entire interest in the Plan
        has been distributed to him, then the remaining portion of that interest
        shall, in accordance with Section 401(a)(9) of the Code, be distributed
        at least as rapidly as under the method of distribution being used under
        Section 10.1.2 at the date of his death.

                (iii)   If a married Participant dies before his benefit
        payments begin, then unless he has specifically elected otherwise, the
        Committee shall cause the balance in his Account to be paid to his
        Spouse. No election by a married Participant of a different Beneficiary
        shall be valid unless the election is accompanied by the Spouse's
        written consent, which (i) must acknowledge the effect of the election,
        (ii) must explicitly provide either that the designated Beneficiary may
        not subsequently be changed by the Participant without the Spouse's
        further consent, or that it may be changed without such consent, and
        (iii) must be witnessed by the Committee, its representative, or a
        notary public. (This requirement shall not apply if the Participant
        establishes to the Committee's satisfaction that the Spouse may not be
        located.)

                10.2-5  All distributions under this section shall be determined
        and made in accordance with final and temporary regulations Sections
        1.401(a)(9)-1 through 1.401(a)(9)-9, as promulgated under

                                      -18-
<PAGE>

        Code Section 401(a)(9), including the minimum distribution incidental
        benefit requirements of Code Section 401(a)(9)(G) and Section
        1.401(a)(9)-2 of the proposed regulations. These provisions override any
        distribution options in the Plan inconsistent with Code Section
        401(a)(9).

        10.3    MARITAL STATUS. The Committee, the Plan, the Trustee, and the
Employers shall be fully protected and discharged from any liability to the
extent of any benefit payments made as a result of the Committee's good faith
and reasonable reliance upon information obtained from a Participant and his
Employer as to his marital status.

        10.4    DELAY IN BENEFIT DETERMINATION. If the Committee is unable to
determine the benefits payable to a Participant or Beneficiary on or before the
latest date prescribed for payment pursuant to Section 10.1 or 10.2, the
benefits shall in any event be paid within 60 days after they can first be
determined, with whatever makeup payments may be appropriate in view of the
delay.

        10.5    ACCOUNTING FOR BENEFIT PAYMENTS. Any benefit payment shall be
charged to the Participant's Account as of the first day of the Valuation Period
in which the payment is made.

        10.6    OPTIONS TO RECEIVE STOCK OR CASH. Unless ownership of virtually
all Stock is restricted to active Employees and qualified retirement plans for
the benefit of Employees pursuant to the certificates of incorporation or
by-laws of the Employers issuing Stock, a terminated Participant or the
Beneficiary of a deceased Participant may instruct the Committee to distribute
the Participant's entire vested interest in his Account in the form of Stock. In
that event, the Committee shall apply the Participant's vested interest in the
Investment Fund to purchase sufficient Stock from the Stock Fund or from any
owner of Stock to make the required distribution. In all other cases, the
Participant's vested interest in the Stock Fund shall be distributed in shares
of Stock, and his vested interest in the Investment Fund shall be distributed in
cash.

        Any Participant who receives Stock pursuant to Section 10.1, and any
person who has received Stock from the Plan or from such a Participant by reason
of the Participant's death or incompetence, by reason of divorce or separation
from the Participant, or by reason of a rollover contribution described in
Section 402(a)(5) of the Code, shall have the right to require the Employer
which issued the Stock to purchase the Stock for its current fair market value
(hereinafter referred to as the "put right"). The put right shall be exercisable
by written notice to the Committee during the first 60 days after the Stock is
distributed by the Plan, and, if not exercised in that period, during the first
60 days in the following Plan Year after the Committee has communicated to the
Participant its determination as to the Stock's current fair market value.
However, the put right shall not apply to the extent that the Stock, at the time
the put right would otherwise be exercisable, may be sold on an established
market in accordance with federal and state securities laws and regulations.
Similarly, the put option shall not apply with respect to the portion of a
Participant's Account which the Employee elected to have reinvested under Code
Section 401(a)(28)(B). If the put right is exercised, the Trustee may, if so
directed by the Committee in its sole discretion, assume the Employer's rights
and obligations with respect to purchasing the Stock. Notwithstanding anything
herein to the contrary, in the case of a plan established by a bank (as defined
in Code Section 581), the put option shall not apply if prohibited by a federal
or state law and Participants are entitled to elect their benefits be
distributed in cash.

        If a Participant elects to receive his distribution in the form of a
lump sum pursuant to Section 10.1.1 of the Plan, the Employer or the Trustee, as
the case may be, may elect to pay for the Stock in equal periodic installments,
not less frequently than annually, over a period beginning not later than 30
days after the exercise of the put right and not exceeding five years, with
adequate security and interest at a reasonable rate on the unpaid balance, all
such terms to be set forth in a promissory note delivered to the seller with
normal terms as to acceleration upon any uncured default.

        If a Participant elects to receive his distribution in the form of an
installment payment pursuant to Section 10.1-2 of the Plan, the Employer or the
Trustee, as the case may be, shall pay for the Stock

                                      -19-
<PAGE>

distributed in the installment distribution over a period which shall not exceed
30 days after the exercise of the put right.

        Nothing contained herein shall be deemed to obligate any Employer to
register any Stock under any federal or state securities law or to create or
maintain a public market to facilitate the transfer or disposition of any Stock.
The put right described herein may only be exercised by a person described in
the second preceding paragraph, and may not be transferred with any Stock to any
other person. As to all Stock purchased by the Plan in exchange for any Stock
Obligation, the put right shall be nonterminable. The put right for Stock
acquired through a Stock Obligation shall continue with respect to such Stock
after the Stock Obligation is repaid or the Plan ceases to be an employee stock
ownership plan.

        10.7    RESTRICTIONS ON DISPOSITION OF STOCK. Except in the case of
Stock which is traded on an established market, a Participant who receives Stock
pursuant to Section 10.1, and any person who has received Stock from the Plan or
from such a Participant by reason of the Participant's death or incompetence, by
reason of divorce or separation from the Participant, or by reason of a rollover
contribution described in Section 402(a)(5) of the Code, shall, prior to any
sale or other transfer of the Stock to any other person, first offer the Stock
to the issuing Employer and to the Plan at the greater of (i) its current fair
market value, or (ii) the purchase price offered in good faith by an independent
third party purchaser. This restriction shall apply to any transfer, whether
voluntary, involuntary, or by operation of law, and whether for consideration or
gratuitous. Either the Employer or the Trustee may accept the offer within 14
days after it is delivered. Any Stock distributed by the Plan shall bear a
conspicuous legend describing the right of first refusal under this Section
10.7, as well as any other restrictions upon the transfer of the Stock imposed
by federal and state securities laws and regulations.

        10.8    CONTINUING LOAN PROVISIONS; CREATIONS OF PROTECTIONS AND RIGHTS.
Except as otherwise provided in Sections 10.6 and 10.7 and this Section, no
shares of Employer Stock held or distributed by the Trustee may be subject to a
put, call or other option, or buy-sell arrangement. The provisions of this
Section shall continue to be applicable to such Stock even if the Plan ceases to
be an employee stock ownership plan under Section 4975(e)(7) of the Code.

        10.9    DIRECT ROLLOVER OF ELIGIBLE DISTRIBUTION. A Participant or
distributee may elect, at the time and in the manner prescribed by the Trustee
or the Committee, to have any portion of an eligible rollover distribution paid
directly to an eligible retirement plan specified by the Participant or
distributee in a direct rollover.

                10.9-1  An "eligible rollover" is any distribution that does not
        include: any distribution that is one of a series of substantially equal
        periodic payments (not less frequently than annually) made for the life
        (or life expectancy) of the distributee or the joint lives (or joint
        life expectancies) of the Participant and the Participant's Beneficiary,
        or for a specified period of ten years or more; any distribution to the
        extent such distribution is required under Code Section 401(a)(9); any
        hardship distribution described in Section 401(k)(2)(B)(i)(IV) of the
        Code; and the portion of any distribution that is not included in gross
        income (determined without regard to the exclusion for net unrealized
        appreciation with respect to employer securities). A portion of a
        distribution shall not fail to be an eligible rollover distribution
        merely because the portion consists of after-tax employee contributions
        which are not includible in gross income. However, such portion may be
        transferred only to an individual retirement account or annuity
        described in section 408(a) or (b) of the Code, or to a qualified
        defined contribution plan described in section 401(a) or 403(a) of the
        Code that agrees to separately accounting for the portion of such
        distribution which is includible in gross income and the portion of such
        distribution which is not so includible.

                10.9-2  An "eligible retirement plan" is an individual
        retirement account described in Code Section 408(a), an individual
        retirement annuity described in Code Section 408(b), an annuity plan
        described in Code Section 403(a), or a qualified trust described in Code
        Section 401(a), that accepts

                                      -20-
<PAGE>

        the distributee's eligible rollover distribution. In the case of
        distributions after December 31, 2001, an eligible retirement plan shall
        also include an annuity contract described in Section 403(b) of the Code
        and an eligible plan under Section 457(b) of the Code which is
        maintained by a state, or any agency or instrumentality of a state or
        political subdivision of a state and which agrees to separately account
        for amounts transferred into such plan from this Plan. In the case of an
        eligible rollover distribution to a surviving Spouse, an eligible
        retirement plan is an individual retirement account or individual
        retirement annuity.

                10.9-3  A "direct rollover" is a payment by the Plan to the
        eligible retirement plan specified by the distributee.

                10.9-4  The term "distributee" shall refer to a deceased
        Participant's Spouse or a Participant's former Spouse who is the
        alternate payee under a qualified domestic relations order, as defined
        in Code Section 414(p).

        10.10   WAIVER OF 30-DAY PERIOD AFTER NOTICE OF DISTRIBUTION. If a
distribution is one to which Sections 401(a)(11) and 417 of the Code do not
apply, such distribution may commence less than 30 days after the notice
required under Section 1.411(a)-11(c) of the Income Tax Regulations is given,
provided that:

                (i)     the Trustee or Committee, as applicable, clearly informs
        the Participant that the Participant has a right to a period of at least
        30 days after receiving the notice to consider the decision of whether
        or not to elect a distribution (and, if applicable, a particular
        option), and

                (ii)    the Participant, after receiving the notice,
        affirmatively elects a distribution.

SECTION 11.     RULES GOVERNING BENEFIT CLAIMS AND REVIEW OF APPEALS.

        11.1    CLAIM FOR BENEFITS. Any Participant or Beneficiary who qualifies
for the payment of benefits shall file a claim for his benefits with the
Committee on a form provided by the Committee. The claim, including any election
of an alternative benefit form, shall be filed at least 30 days before the date
on which the benefits are to begin. If a Participant or Beneficiary fails to
file a claim by the day before the date on which benefits become payable, he
shall be presumed to have filed a claim for payment for the Participant's
benefits in the standard form prescribed by Sections 10.1 or 10.2.

        11.2    NOTIFICATION BY COMMITTEE. Within 90 days after receiving a
claim for benefits (or within 180 days, if special circumstances require an
extension of time and written notice of the extension is given to the
Participant or Beneficiary within 90 days after receiving the claim for
benefits), the Committee shall notify the Participant or Beneficiary whether the
claim has been approved or denied. If the Committee denies a claim in any
respect, the Committee shall set forth in a written notice to the Participant or
Beneficiary:

                (i)     each specific reason for the denial;

                (ii)    specific references to the pertinent Plan provisions on
        which the denial is based;

                (iii)   a description of any additional material or information
        which could be submitted by the Participant or Beneficiary to support
        his claim, with an explanation of the relevance of such information; and

                (iv)    an explanation of the claims review procedures set forth
        in Section 11.3.

        11.3    CLAIMS REVIEW PROCEDURE. Within 60 days after a Participant or
Beneficiary receives notice from the Committee that his claim for benefits has
been denied in any respect, he may file with the

                                      -21-
<PAGE>

Committee a written notice of appeal setting forth his reasons for disputing the
Committee's determination. In connection with his appeal the Participant or
Beneficiary or his representative may inspect or purchase copies of pertinent
documents and records to the extent not inconsistent with other Participants'
and Beneficiaries' rights of privacy. Within 60 days after receiving a notice of
appeal from a prior determination (or within 120 days, if special circumstances
require an extension of time and written notice of the extension is given to the
Participant or Beneficiary and his representative within 60 days after receiving
the notice of appeal), the Committee shall furnish to the Participant or
Beneficiary and his representative, if any, a written statement of the
Committee's final decision with respect to his claim, including the reasons for
such decision and the particular Plan provisions upon which it is based.

SECTION 12.     THE COMMITTEE AND ITS FUNCTIONS.

        12.1    AUTHORITY OF COMMITTEE. The Committee shall be the "plan
administrator" within the meaning of ERISA and shall have exclusive
responsibility and authority to control and manage the operation and
administration of the Plan, including the interpretation and application of its
provisions, except to the extent such responsibility and authority are otherwise
specifically (i) allocated to the Bank, the Employers, or the Trustee under the
Plan and Trust Agreement, (ii) delegated in writing to other persons by the
Bank, the Employers, the Committee, or the Trustee, or (iii) allocated to other
parties by operation of law. The Committee shall have exclusive responsibility
regarding decisions concerning the payment of benefits under the Plan. The
Committee shall have no investment responsibility with respect to the Investment
Fund except to the extent, if any, specifically provided in the Trust Agreement.
In the discharge of its duties, the Committee may employ accountants, actuaries,
legal counsel, and other agents (who also may be employed by an Employer or the
Trustee in the same or some other capacity) and may pay their reasonable
expenses and compensation.

        12.2    IDENTITY OF COMMITTEE. The Committee shall consist of three or
more individuals selected by the Bank. Any individual, including a director,
trustee, shareholder, officer, or Employee of an Employer, shall be eligible to
serve as a member of the Committee. The Bank shall have the power to remove any
individual serving on the Committee at any time without cause upon 10 days
written notice, and any individual may resign from the Committee at any time
upon 10 days written notice to the Bank. The Bank shall notify the Trustee of
any change in membership of the Committee.

        12.3    DUTIES OF COMMITTEE. The Committee shall keep whatever records
may be necessary to implement the Plan and shall furnish whatever reports may be
required from time to time by the Bank. The Committee shall furnish to the
Trustee whatever information may be necessary to properly administer the Trust.
The Committee shall see to the filing with the appropriate government agencies
of all reports and returns required of the Plan under ERISA and other laws.

        Further, the Committee shall have exclusive responsibility and authority
with respect to the Plan's holdings of Stock and shall direct the Trustee in all
respects regarding the purchase, retention, sale, exchange, and pledge of Stock
and the creation and satisfaction of Stock Obligations. The Committee shall at
all times act consistently with the Bank's long-term intention that the Plan, as
an employee stock ownership plan, be invested primarily in Stock. Subject to the
direction of the board as to the application of Employer contributions to Stock
Obligations, and subject to the provisions of Sections 6.4 and 10.6 as to
Participants' rights under certain circumstances to have their Accounts invested
in Stock or in assets other than Stock, the Committee shall determine in its
sole discretion the extent to which assets of the Trust shall be used to repay
Stock Obligations, to purchase Stock, or to invest in other assets to be
selected by the Trustee or an investment manager. No provision of the Plan
relating to the allocation or vesting of any interests in the Stock Fund or the
Investment Fund shall restrict the Committee from changing any holdings of the
Trust, whether the changes involve an increase or a decrease in the Stock or
other assets credited to Participants' Accounts. In determining the proper
extent of the Trust's investment in Stock, the Committee shall be authorized to
employ investment counsel, legal counsel, appraisers, and other agents and to
pay their reasonable expenses and compensation.

                                      -22-
<PAGE>

        12.4    VALUATION OF STOCK. If the valuation of any Stock is not
established by reported trading on a generally recognized public market, the
valuation of such Stock shall be determined by an independent appraiser. For
purposes of the preceding sentence, the term "independent appraiser" means any
appraiser meeting requirements similar to the requirements of the regulations
prescribed under Section 170(a)(1) of the Code.

        12.5    COMPLIANCE WITH ERISA. The Committee shall perform all acts
necessary to comply with ERISA. Each individual member or employee of the
Committee shall discharge his duties in good faith and in accordance with the
applicable requirements of ERISA.

        12.6    ACTION BY COMMITTEE. All actions of the Committee shall be
governed by the affirmative vote of a number of members which is a majority of
the total number of members currently appointed, including vacancies.

        12.7    EXECUTION OF DOCUMENTS. Any instrument executed by the Committee
shall be signed by any member or employee of the Committee.

        12.8    ADOPTION OF RULES. The Committee shall adopt such rules and
regulations of uniform applicability as it deems necessary or appropriate for
the proper administration and interpretation of the Plan.

        12.9    RESPONSIBILITIES TO PARTICIPANTS. The Committee shall determine
which Employees qualify to enter the Plan. The Committee shall furnish to each
Eligible Employee whatever summary plan descriptions, summary annual reports,
and other notices and information may be required under ERISA. The Committee
also shall determine when a Participant or his Beneficiary qualifies for the
payment of benefits under the Plan. The Committee shall furnish to each such
Participant or Beneficiary whatever information is required under ERISA (or is
otherwise appropriate) to enable the Participant or Beneficiary to make whatever
elections may be available pursuant to Sections 6 and 10, and the Committee
shall provide for the payment of benefits in the proper form and amount from the
assets of the Trust Fund. The Committee may decide in its sole discretion to
permit modifications of elections and to defer or accelerate benefits to the
extent consistent with applicable law and the best interests of the individuals
concerned.

        12.10   ALTERNATIVE PAYEES IN EVENT OF INCAPACITY. If the Committee
finds at any time that an individual qualifying for benefits under this Plan is
a minor or is incompetent, the Committee may direct the benefits to be paid, in
the case of a minor, to his parents, his legal guardian, or a custodian for him
under the Uniform Gifts to Minors Act, or, in the case of an incompetent, to his
spouse, or his legal guardian, the payments to be used for the individual's
benefit. The Committee and the Trustee shall not be obligated to inquire as to
the actual use of the funds by the person receiving them under this Section
12.10, and any such payment shall completely discharge the obligations of the
Plan, the Trustee, the Committee, and the Employers to the extent of the
payment.

        12.11   INDEMNIFICATION BY EMPLOYERS. Except as separately agreed in
writing, the Committee, and any member or employee of the Committee, shall be
indemnified and held harmless by the Employer, jointly and severally, to the
fullest extent permitted by ERISA, and subject to and conditioned upon
compliance with 12 C.F.R. Section 545.121, to the extent applicable, against any
and all costs, damages, expenses, and liabilities reasonably incurred by or
imposed upon it or him in connection with any claim made against it or him or in
which it or he may be involved by reason of its or his being, or having been,
the Committee, or a member or employee of the Committee, to the extent such
amounts are not paid by insurance.

        12.12   NONPARTICIPATION BY INTERESTED MEMBER. Any member of the
Committee who also is a Participant in the Plan shall take no part in any
determination specifically relating to his own participation or benefits, unless
his abstention would leave the Committee incapable of acting on the matter.

                                      -23-
<PAGE>

SECTION 13.     ADOPTION, AMENDMENT, OR TERMINATION OF THE PLAN.

        13.1    ADOPTION OF PLAN BY OTHER EMPLOYERS. With the consent of the
Bank, any entity may become a participating Employer under the Plan by (i)
taking such action as shall be necessary to adopt the Plan, (ii) becoming a
party to the Trust Agreement establishing the Trust Fund, and (iii) executing
and delivering such instruments and taking such other action as may be necessary
or desirable to put the Plan into effect with respect to the entity's Employees.

        13.2    PLAN ADOPTION SUBJECT TO QUALIFICATION. Notwithstanding any
other provision of the Plan, the adoption of the Plan and the execution of the
Trust Agreement are conditioned upon their being determined initially by the
Internal Revenue Service to meet the qualification requirements of Section
401(a) of the Code, so that the Employers may deduct currently for federal
income tax purposes their contributions to the Trust and so that the
Participants may exclude the contributions from their gross income and recognize
income only when they receive benefits. In the event that this Plan is held by
the Internal Revenue Service not to qualify initially under Section 401(a), the
Plan may be amended retroactively to the earliest date permitted by U.S.
Treasury Regulations in order to secure qualification under Section 401(a). If
this Plan is held by the Internal Revenue Service not to qualify initially under
Section 401(a) either as originally adopted or as amended, each Employer's
contributions to the Trust under this Plan (including any earnings thereon)
shall be returned to it and this Plan shall be terminated. In the event that
this Plan is amended after its initial qualification and the Plan as amended is
held by the Internal Revenue Service not to qualify under Section 401(a), the
amendment may be modified retroactively to the earliest date permitted by U.S.
Treasury Regulations in order to secure approval of the amendment under Section
401(a).

        13.3    RIGHT TO AMEND OR TERMINATE. The Bank intends to continue this
Plan as a permanent program. However, each participating Employer separately
reserves the right to suspend, supersede, or terminate the Plan at any time and
for any reason, as it applies to that Employer's Employees, and the Bank
reserves the right to amend, suspend, supersede, merge, consolidate, or
terminate the Plan at any time and for any reason, as it applies to the
Employees of each Employer. No amendment, suspension, supersession, merger,
consolidation, or termination of the Plan shall (i) reduce any Participant's or
Beneficiary's proportionate interest in the Trust Fund, (ii) reduce or restrict,
either directly or indirectly, the benefit provided any Participant prior to the
amendment, or (iii) divert any portion of the Trust Fund to purposes other than
the exclusive benefit of the Participants and their Beneficiaries prior to the
satisfaction of all liabilities under the Plan. Moreover, there shall not be any
transfer of assets to a successor plan or merger or consolidation with another
plan unless, in the event of the termination of the successor plan or the
surviving plan immediately following such transfer, merger, or consolidation,
each participant or beneficiary would be entitled to a benefit equal to or
greater than the benefit he would have been entitled to if the plan in which he
was previously a participant or beneficiary had terminated immediately prior to
such transfer, merger, or consolidation. Following a termination of this Plan by
the Bank, the Trustee shall continue to administer the Trust and pay benefits in
accordance with the Plan as amended from time to time and the Committee's
instructions.

SECTION 14.     MISCELLANEOUS PROVISIONS.

        14.1    PLAN CREATES NO EMPLOYMENT RIGHTS. Nothing in this Plan shall be
interpreted as giving any Employee the right to be retained as an Employee by an
Employer, or as limiting or affecting the rights of an Employer to control its
Employees or to terminate the Service of any Employee at any time and for any
reason, subject to any applicable employment or collective bargaining
agreements.

        14.2    NONASSIGNABILITY OF BENEFITS. No assignment, pledge, or other
anticipation of benefits from the Plan will be permitted or recognized by the
Employer, the Committee, or the Trustee. Moreover, benefits from the Plan shall
not be subject to attachment, garnishment, or other legal process for debts or
liabilities of any Participant or Beneficiary, to the extent permitted by law.
This prohibition on assignment

                                      -24-
<PAGE>

or alienation shall apply to any judgment, decree, or order (including approval
of a property settlement agreement) which relates to the provision of child
support, alimony, or property rights to a present or former spouse, child or
other dependent of a Participant pursuant to a state domestic relations or
community property law, unless the judgment, decree, or order is determined by
the Committee to be a qualified domestic relations order within the meaning of
Section 414(p) of the Code, as more fully set forth in Section 14.12 hereof.

        14.3    LIMIT OF EMPLOYER LIABILITY. The liability of the Employer with
respect to Participants under this Plan shall be limited to making contributions
to the Trust from time to time, in accordance with Section 4.

        14.4    TREATMENT OF EXPENSES. All expenses incurred by the Committee
and the Trustee in connection with administering this Plan and Trust Fund shall
be paid by the Trustee from the Trust Fund to the extent the expenses have not
been paid or assumed by the Employer or by the Trustee. The Committee may
determine that, and shall inform the Trustee when, reasonable expenses may be
charged directly to the Account or Accounts of a Participant or group of
Participants to whom or for whose benefit such expenses are allocable, subject
to the guidelines set forth in Field Assistance Bulletin 2003-03, to the extent
not superseded, or any successor directive issued by the Department of Labor.

        14.5    NUMBER AND GENDER. Any use of the singular shall be interpreted
to include the plural, and the plural the singular. Any use of the masculine,
feminine, or neuter shall be interpreted to include the masculine, feminine, or
neuter, as the context shall require.

        14.6    NONDIVERSION OF ASSETS. Except as provided in Sections 5.2 and
14.12, under no circumstances shall any portion of the Trust Fund be diverted to
or used for any purpose other than the exclusive benefit of the Participants and
their Beneficiaries prior to the satisfaction of all liabilities under the Plan.

        14.7    SEPARABILITY OF PROVISIONS. If any provision of this Plan is
held to be invalid or unenforceable, the other provisions of the Plan shall not
be affected but shall be applied as if the invalid or unenforceable provision
had not been included in the Plan.

        14.8    SERVICE OF PROCESS. The agent for the service of process upon=
the Plan shall be the president of the Bank, or such other person as may be
designated from time to time by the Bank.

        14.9    GOVERNING STATE LAW. This Plan shall be interpreted in
accordance with the laws of the State of New York to the extent those laws are
applicable under the provisions of ERISA.

        14.10   EMPLOYER CONTRIBUTIONS CONDITIONED ON DEDUCTIBILITY. Employer
Contributions to the Plan are conditioned on deductibility under Code Section
404. In the event that the Internal Revenue Service shall determine that all or
any portion of an Employer Contribution is not deductible under that Section,
the nondeductible portion shall be returned to the Employer within one year of
the disallowance of the deduction.

        14.11   UNCLAIMED ACCOUNTS. Neither the Employer nor the Trustees shall
be under any obligation to search for, or ascertain the whereabouts of, any
Participant or Beneficiary. The Employer or the Trustees, by certified or
registered mail addressed to his last known address of record with the Employer,
shall notify any Participant or Beneficiary that he is entitled to a
distribution under this Plan, and the notice shall quote the provisions of this
Section. If the Participant or Beneficiary fails to claim his benefits or make
his whereabouts known in writing to the Employer or the Trustees within seven
(7) calendar years after the date of notification, the benefits of the
Participant or Beneficiary under the Plan will be disposed of as follows:

                                      -25-
<PAGE>

                (a)     If the whereabouts of the Participant is unknown but the
        whereabouts of the Participant's Beneficiary is known to the Trustees,
        distribution will be made to the Beneficiary.

                (b)     If the whereabouts of the Participant and his
        Beneficiary are unknown to the Trustees, the Plan will forfeit the
        benefit, provided that the benefit is subject to a claim for
        reinstatement if the Participant or Beneficiary make a claim for the
        forfeited benefit.

        Any payment made pursuant to the power herein conferred upon the
Trustees shall operate as a complete discharge of all obligations of the
Trustees, to the extent of the distributions so made.

        14.12   QUALIFIED DOMESTIC RELATIONS ORDER. Section 14.2 shall not apply
to a "qualified domestic relations order" defined in Code Section 414(p), and
such other domestic relations orders permitted to be so treated under the
provisions of the Retirement Equity Act of 1984. Further, to the extent provided
under a "qualified domestic relations order," a former Spouse of a Participant
shall be treated as the Spouse or surviving Spouse for all purposes under the
Plan.

In the case of any domestic relations order received by the Plan:

                (a)     The Employer or the Committee shall promptly notify the
        Participant and any other alternate payee of the receipt of such order
        and the Plan's procedures for determining the qualified status of
        domestic relations orders, and

                (b)     Within a reasonable period after receipt of such order,
        the Employer or the Committee shall determine whether such order is a
        qualified domestic relations order and notify the Participant and each
        alternate payee of such determination. The Employer or the Committee
        shall establish reasonable procedures to determine the qualified status
        of domestic relations orders and to administer distributions under such
        qualified orders.

        During any period in which the issue of whether a domestic relations
order is a qualified domestic relations order is being determined (by the
Employer or Committee, by a court of competent jurisdiction, or otherwise), the
Employer or the Committee shall segregate in a separate account in the Plan or
in an escrow account the amounts which would have been payable to the alternate
payee during such period if the order had been determined to be a qualified
domestic relations order. If within eighteen (18) months the order (or
modification thereof) is determined to be a qualified domestic relations order,
the Employer or the Committee shall pay the segregated amounts (plus any
interest thereon) to the person or persons entitled thereto. If within eighteen
(18) months it is determined that the order is not a qualified domestic
relations order, or the issue as to whether such order is a qualified domestic
relations order is not resolved, then the Employer or the Committee shall pay
the segregated amounts (plus any interest thereon) to the person or persons who
would have been entitled to such amounts if there had been no order. Any
determination that an order is a qualified domestic relations order which is
made after the close of the eighteen (18) month period shall be applied
prospectively only. The term "alternate payee" means any Spouse, former Spouse,
child or other dependent of a Participant who is recognized by a domestic
relations order as having a right to receive all, or a portion of, the benefit
payable under a Plan with respect to such Participant.

SECTION 15.     TOP-HEAVY PROVISIONS.

        15.1    TOP-HEAVY PLAN. This Plan is top-heavy if any of the following
conditions exist:

                (a)     If the top-heavy ratio for this Plan exceeds sixty
        percent (60%) and this Plan is not part of any required aggregation
        group or permissive aggregation group;

                (b)     If this Plan is a part of a required aggregation group
        (but is not part of a permissive aggregation group) and the aggregate
        top-heavy ratio for the group of Plans exceeds sixty percent (60%); or

                                      -26-
<PAGE>

                (c)     If this Plan is a part of a required aggregation group
        and part of a permissive aggregation group and the aggregate top-heavy
        ratio for the permissive aggregation group exceeds sixty percent (60%).

        15.2    SUPER TOP-HEAVY PLAN This Plan will be a super top-heavy Plan if
any of the following conditions exist:

                (a)     If the top-heavy ratio for this Plan exceeds ninety
        percent (90%) and this Plan is not part of any required aggregation
        group or permissive aggregation group.

                (b)     If this Plan is a part of a required aggregation group
        (but is not part of a permissive aggregation group) and the aggregate
        top-heavy ratio for the group of Plans exceeds ninety percent (90%), or

                (c)     If this Plan is a part of a required aggregation group
        and part of a permissive aggregation group and the aggregate top-heavy
        ratio for the permissive aggregation group exceeds ninety percent (90%).

        15.3    DEFINITIONS.

                In making this determination, the Committee shall use the
following definitions and principles:

                15.3-1  The "Determination Date," with respect to the first Plan
        Year of any plan, means the last day of that Plan Year, and with respect
        to each subsequent Plan Year, means the last day of the preceding Plan
        Year. If any other plan has a Determination Date which differs from this
        Plan's Determination Date, the top-heaviness of this Plan shall be
        determined on the basis of the other plan's Determination Date falling
        within the same calendar years as this Plan's Determination Date.

                15.3-2  A "Key Employee" means any employee or former employee
        (including any deceased employee) who at any time during the plan year
        that includes the determination date was an officer of the employer
        having annual compensation greater than $135,000 (as adjusted under
        section 416(i)(1) of the Code for plan years beginning after December
        31, 2002, a 5-percent owner of the employer, or a 1-percent owner of the
        employer having annual compensation of more than $150,000. For this
        purpose, annual compensation means compensation within the meaning of
        section 415(c)(3) of the Code. The determination of who is a key
        employee will be made in accordance with section 416(i)(1) of the Code
        and the applicable regulations and other guidance of general
        applicability issued thereunder.

                15.3-3  A "Non-key Employee" means an Employee who at any time
        during the five years ending on the top-heavy Determination Date for the
        Plan Year has received compensation from an Employer and who has never
        been a Key Employee, and the Beneficiary of any such Employee.

                15.3-4  A "required aggregation group" includes (a) each
        qualified Plan of the Employer in which at least one Key Employee
        participates in the Plan Year containing the Determination Date and (b)
        any other qualified Plan of the Employer which enables a Plan described
        in (a) to meet the requirements of Code Sections 401(a)(4) or 410. For
        purposes of the preceding sentence, a qualified Plan of the Employer
        includes a terminated Plan maintained by the Employer within the period
        ending on the Determination Date. In the case of a required aggregation
        group, each Plan in the group will be considered a top-heavy Plan if the
        required aggregation group is a top-heavy group. No Plan in the required
        aggregation group will be considered a top-heavy Plan if the required
        aggregation group is not a top-heavy group. All Employers aggregated
        under Code Sections 414(b),

                                      -27-
<PAGE>

        (c) or (m) or (o) (but only after the Code Section 414(o) regulations
        become effective) are considered a single Employer.

                15.3-5  A "permissive aggregation group" includes the required
        aggregation group of Plans plus any other qualified Plan(s) of the
        Employer that are not required to be aggregated but which, when
        considered as a group with the required aggregation group, satisfy the
        requirements of Code Sections 401(a)(4) and 410 and are comparable to
        the Plans in the required aggregation group. No Plan in the permissive
        aggregation group will be considered a top-heavy Plan if the permissive
        aggregation group is not a top-heavy group. Only a Plan that is part of
        the required aggregation group will be considered a top-heavy Plan if
        the permissive aggregation group is top-heavy.

        15.4    TOP-HEAVY RULES OF APPLICATION.

                For purposes of determining the value of Account balances and
the present value of accrued benefits the following provisions shall apply:

                15.4-1  The value of Account balances and the present value of
        accrued benefits will be determined as of the most recent Valuation Date
        that falls within or ends with the twelve (12) month period ending on
        the Determination Date.

                15.4-2  For purposes of testing whether this Plan is top-heavy,
        the present value of an individual's accrued benefits and an
        individual's Account balances is counted only once each year.

                15.4-3  The Account balances and accrued benefits of a
        Participant who is not presently a Key Employee but who was a Key
        Employee in a Plan Year beginning on or after January 1, 1984 will be
        disregarded.

                15.4-4  Employer contributions attributable to a salary
        reduction or similar arrangement will be taken into account. Employer
        matching contributions also shall be taken into account for purposes of
        satisfying the minimum contribution requirements of Section 416(c)(2) of
        the Code and the Plan.

                15.4-5  When aggregating Plans, the value of Account balances
        and accrued benefits will be calculated with reference to the
        Determination Dates that fall within the same calendar year.

                15.4-6  The present values of accrued benefits and the amounts
        of account balances of an employee as of the determination date shall be
        increased by the distributions made with respect to the employee under
        the plan and any plan aggregated with the plan under Section 416(g)(2)
        of the Code during the 1-year period ending on the determination date.
        The preceding sentence shall also apply to distributions under a
        terminated plan which, had it not been terminated, would have been
        aggregated with the plan under Section 416(g)(2)(A)(i) of the Code. In
        the case of a distribution made for a reason other than separation from
        service, death, or disability, this provision shall be applied by
        substituting "five (5) year period" for "one (1) year period."

                15.4-7  Accrued benefits and Account balances of an individual
        shall not be taken into account for purposes of determining the
        top-heavy ratios if the individual has performed no services for the
        Employer during the one (1) year period ending on the applicable
        Determination Date. Compensation for purposes of this subparagraph shall
        not include any payments made to an individual by the Employer pursuant
        to a qualified or non-qualified deferred compensation plan.

                15.4-8  The present value of the accrued benefits or the amount
        of the Account balances of any Employee participating in this Plan shall
        not include any rollover contributions or other transfers voluntarily
        initiated by the Employee except as described below. If this Plan
        transfers or rolls over

                                      -28-
<PAGE>

        funds to another Plan in a transaction voluntarily initiated by the
        Employee, then this Plan shall count the distribution for purposes of
        determining Account balances or the present value of accrued benefits. A
        transfer incident to a merger or consolidation of two or more Plans of
        the Employer (including Plans of related Employers treated as a single
        Employer under Code Section 414), or a transfer or rollover between
        Plans of the Employer, shall not be considered as voluntarily initiated
        by the Employee.

        15.5    MINIMUM CONTRIBUTIONS. For any Top-Heavy Year, each Employer
shall make a special contribution on behalf of each Participant to the extent
that the total allocations to his Account pursuant to Section 4 is less than the
lesser of:

                (i)     three percent of his 415 Compensation for that year, or

                (ii)    the highest ratio of such allocation to 415 Compensation
        received by any Key Employee for that year. For purposes of the special
        contribution of this Section 15.2, a Key Employee's 415 Compensation
        shall include amounts the Key Employee elected to defer under a
        qualified 401(k) arrangement. Such a special contribution shall be made
        on behalf of each Participant who is employed by an Employer on the last
        day of the Plan Year, regardless of the number of his Hours of Service,
        and shall be allocated to his Account.

        If the Employer maintains a qualified plan in addition to this Plan and
more than one such plan is determined to be Top-Heavy, a minimum contribution or
a minimum benefit shall be provided in one of such other plans, including a plan
that consists solely of a cash or deferred arrangement which meets the
requirements of Section 401(k)(12) of the Code and matching contributions with
respect to which the requirements of Section 401(m)(11) of the Code are met. If
the Employer has both a Top-Heavy defined benefit plan and a Top-Heavy defined
contribution plan and a minimum contribution is to be provided only in the
defined contribution plan, then the sum of the Employer contributions and
forfeitures allocated to the Account of each Non-key Employee shall be equal to
at least five percent (5%) of such Non-key Employee's 415 Compensation for that
year.

        15.6    MINIMUM VESTING. If in any Plan Year the eligibility provisions
under Section 3.1 require an Employee to have more than two Eligibility Years of
service in order to participate in the plan, then the following top-heavy
vesting provisions shall apply. For any Plan Year in which this Plan is
Top-Heavy, a Participant's vested interest in his Account shall be based on the
following "top-heavy table":

             Vesting Years                 Percentage of Interest Vested
             -------------                 -----------------------------
             Less than 2                                  0%
                   2                                     20%
                   3                                     40%
                   4                                     60%
                   5                                     80%
             6 or more                                  100%

        15.7    TOP-HEAVY PROVISIONS CONTROL IN TOP-HEAVY PLAN. In the event
this Plan becomes top-heavy and a conflict arises between the top-heavy
provisions herein set forth and the remaining provisions set forth in this Plan,
the top-heavy provisions shall control.

                                      -29-<PAGE>

                              EMPLOYMENT AGREEMENT

        This Agreement is made effective as of the ____ day of _____________,
2005 by and among Brooklyn Federal Savings Bank (the "Bank"), a federally
chartered stock savings bank, with its principal administrative office at 81
Court Street, Brooklyn, New York 11201, Brooklyn Federal Bancorp, Inc. (the
"Company"), a federal mid-tier stock holding company, with its principal
administrative office at 81 Court Street, Brooklyn, New York 11201, and
___________________ ("Executive").

        WHEREAS, Executive is currently employed as the President and Chief
Executive Officer of the Bank; and

        WHEREAS, the Bank has converted from the mutual to the stock form of
organization and has become a wholly-owned subsidiary of the Company, in
connection with the Bank's mutual holding company reorganization; and

        WHEREAS, the Bank desires to assure itself of the continued services of
Executive pursuant to the terms of this Agreement.

        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 President and Chief Executive Officer of the Bank. During said period,
Executive also agrees to serve, if elected, as an officer and director of any
subsidiary or affiliate of the Bank.

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 thirty-six (36)
full calendar months thereafter. Commencing on _____________, 200__ and
continuing on ______________ of each year thereafter (the "Anniversary Date"),
this Agreement shall renew for an additional year such that the remaining term
shall be three (3) years unless written notice of non-renewal ("Non-Renewal
Notice") is provided to Executive at least thirty (30) days and not more than
sixty (60) days prior to any such Anniversary Date, that this Agreement shall
terminate at the end of thirty-six (36) 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 comprehensive
performance evaluation and review of 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.

        (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 faithfully perform his duties hereunder
including activities and services related to the organization, operation and
management of the Bank.

<PAGE>

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 bi-weekly. During
the period of this Agreement, Executive's Base Salary shall be reviewed at least
annually; the first such review will be made no later than [January 31] of each
year during the term of this Agreement and shall be effective from the first day
of said month through the end of the calendar year. Such review shall be
conducted by a Committee designated by the Board, and the Board may increase,
but not decrease, 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.

        (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. Without limiting the generality of the foregoing provisions of this
Section 3(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 Executive under any such plan or
arrangement will be deemed to be in lieu of other compensation to which
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 in performing his
obligations under this Agreement and may provide such additional compensation in
such form and such amounts as the Board may from time to time determine.

4.      OUTSIDE ACTIVITIES

        Executive may serve as a member of the board of directors of business,
community and charitable organizations subject to the approval of the Board,
provided that in each case such service shall not materially interfere with the
performance of his duties under this Agreement or present any conflict of
interest. Such service to and participation in outside organizations shall be
presumed for these purposes to be for the benefit of the Bank, and the Bank
shall reimburse Executive his reasonable expenses associated therewith.

                                       2
<PAGE>

5.      WORKING FACILITIES AND EXPENSES

        Executive's principal place of employment shall be at the Bank's
principal executive offices. The Bank shall provide Executive, at his principal
place of employment, with a private office, stenographic services and other
support services and facilities suitable to his position with the Bank and
necessary or appropriate in connection with the performance of his duties under
this Agreement. The Bank shall provide Executive with an automobile suitable to
the position of President and Chief Executive Officer of the Bank, and such
automobile may be used by Executive in carrying out his duties under this
Agreement and for his personal use such as commuting between his residence and
his principal place of employment. The Bank shall reimburse Executive for the
cost of maintenance, use and servicing of such automobile. The Bank shall
reimburse Executive for his ordinary and necessary business expenses incurred in
connection with the performance of his duties under this Agreement, including,
without limitation, fees for memberships in such clubs and organizations that
Executive and the Board mutually agree are necessary and appropriate to further
the business of the Bank, and travel and reasonable entertainment expenses.
Reimbursement of such expenses shall be made upon presentation to the Bank of an
itemized account of the expenses in such form as the Bank may reasonably
require.

6.      PAYMENTS TO EXECUTIVE UPON AN EVENT OF TERMINATION

        The provisions of this Section 6 shall in all respects be subject to the
terms and conditions stated in Sections 9 and 17.

        (a) The provisions of this Section 6 shall apply upon the occurrence of
an Event of Termination (as herein defined) during Executive's term of
employment under this Agreement. 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)
                Disability or Retirement, as defined in Section 7 below, or (B)
                Termination for Cause as defined in Section 8 hereof; or

        (ii)    Executive's resignation from the Bank's employ, upon any

                (A) failure to elect or reelect or to appoint or reappoint
                    Executive as President and Chief Executive Officer,

                (B) 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,

                (C) liquidation or dissolution of the Bank or Company other than
                    liquidations or dissolutions that are caused by
                    reorganizations that do not affect the status of Executive,
                    or

                (D) material breach of this Agreement by the Bank.

                                       3
<PAGE>

Upon the occurrence of any event described in clauses (ii) (A), (B), (C)or (D),
above, Executive shall have the right to elect to terminate his employment under
this Agreement by resignation upon sixty (60) days prior written notice given
within a reasonable period of time not to exceed four calendar months after the
initial event giving rise to said right to elect. Notwithstanding the preceding
sentence, in the event of a continuing breach of this Agreement by the Bank,
Executive, after giving due notice within the prescribed time frame of an
initial event specified above, shall not waive any of his rights solely under
this Agreement and this Section 6 by virtue of the fact that Executive has
submitted his resignation but has remained in the employment of the Bank and is
engaged in good faith discussions to resolve any occurrence of an event
described in clauses (A), (B), (C) or (D) above.

        (iii)   Executive's involuntary termination by the Bank or voluntary
                resignation from the Bank's employ on the effective date of, or
                at any time following, a Change in Control during the term of
                this Agreement. For these purposes, a Change in Control of the
                Bank or the Company shall mean a change in control of a nature
                that: (i) would be required to be reported in response to Item
                5.01 of the current report on Form 8-K, as in effect on the date
                hereof, pursuant to Section 13 or 15(d) of the Securities
                Exchange Act of 1934 (the "Exchange Act"); or (ii) results in a
                Change in Control of the Bank or the Company within the meaning
                of the Home Owners' Loan Act, as amended, and applicable rules
                and regulations promulgated thereunder (collectively, the
                "HOLA") as in effect at the time of the Change in Control; or
                (iii) without limitation such a Change in Control shall be
                deemed to have occurred at such time as (a) any "person" (as the
                term is used in Sections 13(d) and 14(d) of the Exchange Act) is
                or becomes the "beneficial owner" (as defined in Rule 13d-3
                under the Exchange Act), directly or indirectly, of securities
                of the Company representing 25% or more of the combined voting
                power of Company's outstanding securities, except for any
                securities purchased by the Bank's employee stock ownership plan
                or trust; or (b) individuals who constitute the Board on the
                date hereof (the "Incumbent Board") cease for any reason to
                constitute at least a majority thereof, PROVIDED that any person
                becoming a director subsequent to the date hereof whose election
                was approved by a vote of at least three-quarters of the
                directors comprising the Incumbent Board, or whose nomination
                for election by the Company's stockholders was approved by the
                same Nominating Committee serving under an Incumbent Board,
                shall be, for purposes of this clause (b), considered as though
                he were a member of the Incumbent Board; or (c) a plan of
                reorganization, merger, consolidation, sale of all or
                substantially all the assets of the Bank or the Company or
                similar transaction in which the Bank or Company is not the
                surviving institution occurs or is effected; or (d) a proxy
                statement soliciting proxies from stockholders of the Company,
                by someone other than the current management of the Company is
                distributed, seeking stockholder approval of a plan of
                reorganization, merger or consolidation of the Company or
                similar transaction with one or more corporations as a result of
                which the outstanding shares of the class of securities then
                subject to the plan are to be exchanged for or converted into
                cash or property or securities not issued by the Company; or (e)
                a tender offer is made for 25% or more of the voting securities
                of the Company and the shareholders owning beneficially or of
                record 25% or more of the outstanding securities of the
                                       4
<PAGE>

                Company have tendered or offered to sell their shares pursuant
                to such tender offer and such tendered shares have been accepted
                by the tender offeror. Notwithstanding anything in this
                subsection to the contrary, a Change in Control shall not be
                deemed to have occurred upon the conversion of the Company's
                mutual holding company parent to stock form, or in connection
                with any reorganization used to effect such a conversion.

        (b) Upon the occurrence of an Event of Termination, as defined in
Section 6(a)(i), (ii) or (iii), on the Date of Termination, as defined in
Section 9(b), 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 sum equal to three (3) times the
sum of (i) Base Salary and (ii) the highest rate of bonus awarded to Executive
during the prior three years. At the election of Executive, which election is to
be made on an annual basis during the month of January, and which election is
irrevocable for the year in which made and upon the occurrence of an Event of
Termination, any payments shall be made in a lump sum, or paid bi-weekly during
the remaining term of this Agreement following Executive's termination. In the
event that no election is made, payment to Executive will be made on a bi-weekly
basis during the remaining term of this Agreement. Such payments shall not be
reduced in the event 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, dental and disability coverage substantially
identical to the coverage maintained by the Bank for Executive prior to his
termination. Such coverage shall continue for thirty-six (36) months from the
Date of Termination.

        (d) Upon the occurrence of an Event of Termination, Executive will
immediately vest in any outstanding unvested stock options or shares of
restricted stock of the Company that have been awarded to him.

        (e) Upon the occurrence of an Event of Termination, within 60 days (or
within such shorter period to the extent that information can be reasonably be
obtained) following his termination of employment with the Bank, a lump sum
payment in an amount equal to the present value of the Bank's contributions that
would have been made on his behalf under each of the Bank's (i) 401(k) Plan,
(ii) money purchase pension plan, and (iii) employee stock ownership plan (and
any other defined contribution plan maintained by the Bank) if he had continued
working for the Bank for a thirty-six (36) month period following his
termination earning the Base Salary that would have been achieved during the
remaining unexpired term of this Agreement (assuming, if a Change in Control has
occurred, that the annual Base Salary increases under Section 3(a) would apply
and, additionally, that such payment would continue for the remaining unexpired
term of this Agreement) and making the maximum amount of employee contributions
permitted, if any, under such plan or plans, where such present values are to be
determined using a discount rate of 6%.

        (f) Notwithstanding the preceding paragraphs of this Section, in the
event that the aggregate payments or benefits to be made or afforded to
Executive under said paragraphs (the "Termination Benefits") would be deemed to
include an "excess parachute payment" under Section 280G of the Code or any
successor thereto, then such Termination Benefits will be

                                       5
<PAGE>

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.

7.      TERMINATION UPON RETIREMENT, DISABILITY OR DEATH

        For purposes of this Agreement, termination by the Bank of Executive's
employment based on "Retirement" shall mean termination of Executive's
employment by the Board of Directors upon Executive's attainment of age 65, or
such later date as determined by the Board of Directors of the Bank. Upon
termination of Executive's employment because of Retirement, Executive shall be
entitled to all benefits under any retirement plan of the Bank and other plans
to which Executive is a party, but Executive shall not be entitled to the
Termination Benefits specified in Section 6(b) through 6(e) hereof.

        In the event Executive is unable to perform his duties under this
Agreement on a full-time basis for a period of six (6) consecutive months by
reason of illness or other physical or mental disability, the Bank may terminate
this Agreement, provided that the Bank shall continue to be obligated to pay
Executive his Base Salary for the remaining term of the Agreement, or one year,
whichever is the longer period of time, and provided further that any amounts
actually paid to Executive pursuant to any disability insurance or other similar
such program which the Bank has provided or may provide on behalf of its
employees or pursuant to any workman's or social security disability program
shall reduce the compensation to be paid to Executive pursuant to this
paragraph.

        In the event of Executive's death during the term of the Agreement, his
estate, legal representatives or named beneficiaries (as directed by Executive
in writing) shall be paid Executive's Base Salary as defined in Paragraph 3(a)
at the rate in effect at the time Executive's death for a period of one (1) year
from the date of Executive's death, and the Bank will continue to provide
medical, dental, family and other benefits normally provided for an Executive's
family for one (1) year after Executive's death.

8.      TERMINATION FOR CAUSE

        The term "Termination for Cause" shall mean termination because of
Executive's personal dishonesty, incompetence, willful misconduct, any breach of
fiduciary duty involving personal profit, intentional or negligent failure to
perform stated duties, willful violation of any law, rule, or regulation (other
than minor 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 institutions 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 Executive not in good faith and
without reasonable belief that 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 three-fourths 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),

                                       6
<PAGE>

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. Executive shall not have the right to receive compensation or other
benefits for any period after Termination for Cause. Any stock options granted
to Executive under any stock option plan of the Bank, the Company or any
subsidiary or affiliate thereof, shall become null and void effective upon
Executive's receipt of Notice of Termination for Cause pursuant to Section 9
hereof, and shall not be exercisable by Executive at any time subsequent to such
Termination for Cause.

9.      NOTICE

        (a) Any purported termination by the Bank or by Executive shall be
communicated by Notice of Termination to the other party hereto. 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.

        (b) "Date of Termination" shall mean (A) if Executive's employment is
terminated for Disability, thirty (30) days after a Notice of Termination is
given (provided that he shall not have returned to the performance of his duties
on a full-time basis during such thirty (30) day period), and (B) if his
employment is terminated for any other reason, the date specified in the Notice
of Termination (which, in the case of a Termination for Cause, shall not be less
than thirty (30) days from the date such Notice of Termination is given).

        (c) 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, except upon the voluntary
termination by Executive in which case the Date of Termination shall be the date
specified in the Notice, the Date of Termination shall be the date on which the
dispute is finally determined, either by mutual written agreement of the
parties, by a binding arbitration award, or by a final judgment, order or decree
of a court of competent jurisdiction (the time for appeal having expired and no
appeal having been perfected) and provided further that the Date of Termination
shall be extended by a notice of dispute only if such notice is given in good
faith and the party giving such notice pursues the resolution of such dispute
with reasonable diligence. Notwithstanding the pendency of any such dispute, the
Bank will continue to pay Executive his full compensation in effect when the
notice giving rise to the dispute was given (including, but not limited to, Base
Salary) and continue Executive as a participant in all compensation, benefit and
insurance plans in which he was participating when the notice of dispute was
given, until the dispute is finally resolved in accordance with this Agreement,
provided such dispute is resolved within the term of this Agreement. If such
dispute is not resolved within the term of the Agreement, the Bank shall not be
obligated, upon final resolution of such dispute, to pay Executive compensation
and other payments accruing beyond the term of the Agreement. Amounts paid under
this Section shall be offset against or reduce any other amounts due under this
Agreement.

                                       7
<PAGE>

10.     POST-TERMINATION OBLIGATIONS

        (a) All payments and benefits to Executive under this Agreement shall be
subject to Executive's compliance with paragraph (b) of this Section 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.

11.     NON-COMPETITION

        (a) Upon any termination of Executive's employment hereunder, other than
a termination, (whether voluntary or involuntary) in connection with a Change in
Control, as a result of which the Bank is paying Executive benefits under
Section 6 of this Agreement, Executive agrees not to compete with the Bank
and/or the Company for a period of one (1) year following such termination
within twenty-five (25) miles of any existing branch of the Bank or any
subsidiary of the Company or within twenty-five (25) miles of any office for
which the Bank, the Company or a Bank subsidiary of the Company has filed an
application for regulatory approval to establish an office, determined as of the
effective date of such termination, except as agreed to pursuant to a resolution
duly adopted by the Board. Executive agrees that during such period and within
said area, cities, towns and counties, Executive shall not work for or advise,
consult or otherwise serve with, directly or indirectly, any entity whose
business materially competes with the depository, lending or other business
activities of the Bank and/or the Company. The parties hereto, recognizing that
irreparable injury will result to the Bank and/or the Company, its business and
property in the event of Executive's breach of this Subsection 11(a) agree that
in the event of any such breach by Executive, the Bank and/or the Company will
be entitled, in addition to any other remedies and damages available, to an
injunction to restrain the violation hereof by Executive, Executive's partners,
agents, servants, employers, employees and all persons acting for or with
Executive. Executive represents and admits that Executive's experience and
capabilities are such that Executive can obtain employment in a business engaged
in other lines and/or of a different nature than the Bank and/or the Company,
and that the enforcement of a remedy by way of injunction will not prevent
Executive from earning a livelihood. Nothing herein will be construed as
prohibiting the Bank and/or the Company from pursuing any other remedies
available to the Bank and/or the Company for such breach or threatened breach,
including the recovery of damages from Executive.

        (b) 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 any 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

                                       8
<PAGE>

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 Executive
of the provisions of this Section, 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.

12.     SOURCE OF PAYMENTS

        (a) 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.

        (b) Notwithstanding any provision herein to the contrary, to the extent
that payments and benefits, as provided by this Agreement, are paid to or
received by Executive under an Employment Agreement with the Company, if any,
such compensation payments and benefits paid the Company will be subtracted from
any amounts due simultaneously to Executive under similar provisions of this
Agreement. Payments pursuant to this Agreement and a Company Employment
Agreement, if any, shall be allocated in proportion to the level of activity and
the time expended on such activities by Executive as determined by the Company
and the Bank on a quarterly basis.

13.     NO EFFECT ON EMPLOYEE BENEFITS PLANS OR PROGRAMS

        The termination of Executive's employment during the term of this
Agreement or thereafter, whether by the Company or by Executive, shall have no
effect on the vested rights of Executive under the Company's or the Bank's
qualified or non-qualified retirement, pension, savings, thrift, profit-sharing
or stock bonus plans, group life, health (including hospitalization, medical and
major medical), dental, accident and long term disability insurance plans or
other employee benefit plans or programs, or compensation plans or programs in
which Executive was a participant.

14.     REQUIRED REGULATORY PROVISIONS

        (a) The Bank may terminate Executive's employment at any time. 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 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 USC ss.1818(e)(3)) or 8(g) (12 USC ss.1818(g)) of the
Federal Deposit Insurance Act ("FDIA"), as amended by the Financial Institutions
Reform, Recovery and Enforcement Act of

                                       9
<PAGE>

1989, the Bank's obligations under this Agreement 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 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 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 USC ss.1818(e)) or 8(g) (12 USC ss.1818(g)) of FDIA, all
obligations of the Bank under this Agreement 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 USC
ss.1813(x)(1)) of FDIA, all obligations of the Bank under this Agreement 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 Agreement shall be
terminated, except to the extent determined that continuation of this Agreement
is necessary for the continued operation of the Bank, (i) by the Federal Deposit
Insurance Corporation ("FDIC"), at the time the FDIC enters into an agreement to
provide assistance to or on behalf of the Bank under the authority contained in
Section 13(c) (12 USC ss.1823(c)) of FDIA; or (ii) when the Bank is determined
by the 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) Notwithstanding anything herein contained to the contrary, any
payments to Executive by the Company, whether pursuant to this Agreement or
otherwise, are subject to and conditioned upon their compliance with Section
18(k) of FDIA, 12 U.S.C. Section 1828(k), and the regulations promulgated
thereunder in 12 C.F.R. Part 359.

15.     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.

16.     ENTIRE AGREEMENT; MODIFICATION AND WAIVER

        (a) This instrument contains the entire agreement of the parties
relating to the subject matter hereof, and supercedes in its entirety any and
all prior agreements, understandings or representations relating to the subject
matter hereof, except that the parties acknowledge that this Agreement shall not
impact any of the rights and obligations of the parties under any agreement or
plan entered into with or by the Company pursuant to which the Executive may
receive compensation or benefits except as set forth in Section 12(b) hereof. No
modifications of this Agreement shall be valid unless made in writing and signed
by the parties hereto.

                                       10
<PAGE>

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

        (c) 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.

17.     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.

18.     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.

19.     GOVERNING LAW

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

20.     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, one of whom shall be selected by the Bank, one of whom
shall be selected by Executive and the third of whom shall be selected by the
other two arbitrators. The panel shall sit in a location within fifty (50) miles
from the location of the Bank, in accordance with the rules of the Judicial
Mediation and Arbitration Systems (JAMS) then in effect. Judgment may be entered
on the arbitrators 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.

21.     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 Executive's favor.

                                       11
<PAGE>

22.     INDEMNIFICATION

        During the term of this Agreement and for a period of six (6) years
thereafter, the Bank 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 (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). If such action, suit or proceeding is brought against Executive in his
capacity as an officer or director of the Bank, however, such indemnification
shall not extend to matters as to which Executive is finally adjudged to be
liable for willful misconduct in the performance of his duties.

23.     SUCCESSOR TO THE ASSOCIATION

        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.

                                       12
<PAGE>

SIGNATURES

        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 Executive has signed this Agreement, on the day and date first
above written.

ATTEST:                            BROOKLYN FEDERAL SAVINGS BANK

____________________               By:_________________________________________
Secretary                             Name
                                      Title

ATTEST:                            BROOKLYN FEDERAL BANCORP, INC.

____________________               By:_________________________________________
Secretary                             Name
                                      Title

WITNESS:                           EXECUTIVE

____________________               By:_________________________________________
                                      Name
                                      President and Chief Executive Officer

                                       13

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